June 8

Finally, Legislation To Help Independent Restaurants

Independent restaurants across the nation need help from our government — here is a breakdown of a few policies being fought for in congress right now.

From acts of selfless community service, all the way to the massive contributions in the overall economy, the Restaurant Industry has more than proven its importance in the United States. Right now, our industry is at risk and needs help from our government to get through this pandemic. While the CARES Act intended to help small businesses, the SBA and PPP loans just don’t work for our unique industry and aid cannot come as a one-size-fits-all solution. Independent restaurants — which make up a total of 7 out of 10 restaurants nationally — have been left to fend for themselves as they play their part in flattening the curve of COVID-19.

Luckily, there’s finally some meaningful representation in congress to fight for independent restaurants. Here is a breakdown of a couple policies that work to help independent restaurants survive the pandemic.

The PPP Flexibility Act
Last Friday, June 5th, Trump signed the PPP Flexibility Act into law, which creates important changes to the original PPP in order to help small businesses qualify for loan forgiveness. The PPPFA is bipartisan legislation presented by representative Dean Philips (D-MN) and representative Chip Roy (R-TX) and was passed with an almost unanimous vote (417-1) by house representatives on May 27th. Last Wednesday, June 3rd, the PPPFA bill was approved by the Senate and sent to Trump to finalize the bill.

Under the amended act, the original 8 week period in which businesses have to spend their loan money is extended to 24 weeks. It also allows more flexibility on how the money is currently allocated to qualify for forgiveness. The change requires 60% of funds be used toward payroll and 40% toward interest on mortgage, rent and utilities — a decent adjustment from the previous 75/25 requirement. The PPPFA extends the two year repayment plan to five years, and offers businesses with PPP loans a payroll tax deferment. Borrowers also have more flexibility to meet the rehiring requirements. The June 30th deadline to rehire staff is extended to December 31st, and the bill adds more exceptions for businesses that are unable to hire back their full staff — including the inability to resume the same volume of business as before February 15, 2020.

While the policy changes presented by the PPP Flexibility Act will go a long way toward helping independent restaurants who have been able to get these loans, some are fighting for more aid that specifically helps independent restaurants in the form of grants rather than loans. Which brings us to the next policy floating around congress.

Oregon Democratic Representative Earl Blumenauer has introduced The Real Economic Support That Acknowledges Unique Restaurant Assistance Needed To Survive Act (RESTAURANTS Act for short — thank god, because even typing that out was painful). In a white paper that proposes his legislation, Bluemenauer recognizes, “Restaurants are the beating heart of a community but the COVID-19 pandemic is putting their survival in jeopardy.” He acknowledges the unique situation of Independent Restaurants and that they need help to make it to the other side of this pandemic.

The RESTAURANTS Act creates a $120 billion grant program to aid independent restaurants through the end of 2020. Directly from Bluemenauer’s white paper, the Department of Treasury would administer grants to food and beverage businesses that, “are not publicly traded or part of a chain with 20 or more locations doing business under the same name” — creating relief specifically for independent restaurants and restaurant groups. The grants would, “cover the difference between revenues from 2019 and projected revenues through 2020, with a maximum grant of $10 million.” Restaurants who receive grant money would not have to pay it back and funds would be available through the end of 2020. There are a few requirements to what the money could be used for and also how much a restaurant would be given if they also received a PPP loan and/or EIDL loan. To read all that is being proposed, you can read the full copy of the white paper here.

The RESTAURANTS Act has gained support from the Independent Restaurant Coalition (IRC) which has been fighting for an Independent Restaurant Stabilization Fund and has become a strong voice in representing Independent Restaurants at the national level. While this Act has been proposed and is gaining support, it might be awhile before we hear more on the progress of a stabilization fund. To help fight for an Independent Restaurant Stabilization fund you can visit the IRC’s website, where they have created an easy way to contact your state representatives asking that they support the Restaurant Stabilization Fund. I also recommend signing up for their newsletter — the IRC does a great job at keeping their readers informed on how they are working at a national level to represent independent restaurants across the country.

About the author


Ashley McNally likes to cook, loves to bake, and is always dreaming of her next meal. With over 13 years of experience working in various roles within a restaurant — McNally has made a home in hospitality.


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