The Restaurant Revitalization Fund is open for applications, but operators fear it’s not enough
Congress approved $28.6 billion in grant money for independent restaurants. It falls short of what advocates say is needed, but they still see reason for optimism.
Around 140,000 operators of small U.S. restaurants, bars, food trucks, and breweries logged on to the Restaurant Revitalization Fund (RRF) portal on April 30 to pre-register for $28.6 billion in federal grant money made available by the American Rescue Plan. Alex Raij was one of them. The co-owner of three neighborhood restaurants in Brooklyn and Manhattan—La Vara, Saint Julivert, and Txikito—was now anxiously awaiting the big day on May 3. That’s when the Small Business Administration (SBA) would begin accepting first-come, first-served applications for the aid, which was designated for a wider swath of industry establishments than had originally received assistance from two rounds of Paycheck Protection Program (PPP)—those who hadn’t qualified, or who didn’t apply before monies ran out, or whose banks were unprepared to assist them.
Raij had “talked to friends more prepared than me and watched a million webinars” on how to apply, she said. “But I used to sleep out for concert tickets and that’s what this feels like. It feels stressful.”
Amid the stress were glimmers of hope. JJ Johnson is the owner of New York’s FieldTrip, three fast-casual restaurants specializing in rice bowls made with heirloom grains and global ingredients, two of which potentially qualify for grants. “The economy of the restaurant industry has changed and there are not enough rice bowls you can sell to get back,” he said. “[RRF grants] allow everyone to start with a clean slate.”
“I used to sleep out for concert tickets and that’s what this feels like. It feels stressful.”
In the first 21 days that the program is open for business, the SBA is accepting applications only from women, veterans, and socially or economically disadvantaged owners before moving on to a broader pool of independent establishments, of which there are approximately 500,000 across the country. But the money, advocates are certain, falls short of what’s necessary to revive an industry that has staggered through over a year of Covid chaos.
In fact, the Independent Restaurant Coalition (IRC), which formed last March to help independent food and beverage businesses recoup some of their catastrophic revenue losses— partnering with the SBA to get this grant program piloted, operational, and “customer-centric”—had lobbied Congress to release $120 billion. The fractional amount given, though, “won’t be anywhere near enough to save restaurants,” said Los Angeles-based chef and IRC co-founder Caroline Styne in a press conference last week. “We have a long way to go and the need is deep. While this will help, we’re all very convinced that this money is going to run out pretty quickly.”
In the same press conference, SBA associate administrator Patrick Kelley said the Biden administration and the SBA were “focused like a laser” on the RRF and committed to having it distribute “the most amount of money to the most amount of businesses in the least amount of time.”
“We have a long way to go and the need is deep. While this will help, we’re all very convinced that this money is going to run out pretty quickly.”
Early on May 3, IRC’s executive director, Erika Polmar, who runs a farm dinner series in Oregon, had done a bit of math, dividing $28.6 billion by the 140,000 people who’d already pre-registered for the RRF and coming up with “something like $200,000 per applicant.” However, she was quick to point out, “What a restaurant in Oregon needs versus a restaurant in Florida that never fully closed are two very different things, so it’s hard to put a number down and say, this is the average, and figure out how quickly it will be exhausted.” As a result, the IRC was gearing up to “do the same thing we’ve been doing for the last 14 months: going back to congressional champions [like New York’s Senator Chuck Schumer] and encouraging our grassroots network to…ask [Congress] to refill the fund.” Ashley Kosiak, director of programs at the James Beard Foundation, which partnered with the IRC in pushing for the RRF, referred to the funds as a “tremendous and important start.”
In the first hour the RRF portal was live—featuring a Spanish language option in a first for the SBA, as well as assistance in eight other languages beyond English—Polmar had gotten calls from half a dozen panicked people stuck inside the system “saying, ‘Should I hit refresh or sit here and watch the screen—what should I do?’ Then 15 minutes later saying, ‘Ok, it’s all done,’” she said. Jason Wang, owner of Xi’an Famous Foods restaurants in New York, had hit these snags—multiple times, as he was applying for grants for over 12 restaurants. Still, he said the process had significantly improved since the first PPP applications were rolled out last year, calling it “pretty accessible” by comparison.
He said he was grateful for the opportunity to apply for more funding (he’d gotten both PPP and Economic Injury Disaster loans): “We’ve been running on a very low tank of gas all this time, but what matters is finding out if this is going to be the light at the end of the tunnel that gives me and many others comfort that we’re not digging ourselves into another hole,” he said. But he was also concerned about who would be left behind, not just because of insufficient funds but because a certain number of mom and pop shops “operate a good portion as cash businesses and even though a conservative person would say, ‘So what, that’s what you get when you don’t pay taxes,’ you’re losing value to society and shrinking the restaurant industry.”
Nevertheless, Wang, like others, was feeling cautiously optimistic that the industry was on track to regain some equilibrium, although he knew this assuredly meant not every restaurant was destined to survive. Polmar expressed confidence that the RRF grants would make a big difference at least to some struggling businesses. FieldTrip’s Johnson wondered if the “free” money would result in a sales tax hike, but enthused regardless, “I’ll take it.” La Vara’s Raij, who had managed to score a PPP loan in the “second round of the first round” last year that “for sure saved us,” hoped that an RRF grant would similarly prove to be what she called a “lifesaver.” While the PPP had given her “a little bit of a reprieve and I wouldn’t have been in business without it,” she said the RRF would “allow you to be able to imagine a little bit of a future. It doesn’t feel easy right now, but it feels fair and I have to believe in this because it’s my lifeline. I’m going into it thinking it’s going to be great.”