Direct aid for restaurants won’t occur until at least next month, according to a Small Business Administration official.
Patrick Kelley, associate administrator for the SBA’s Office of Capital Access, told a Senate committee Wednesday that the organization is targeting a phased April launch for the $28.6 billion Restaurant Revitalization Fund. The program is part of the $1.9 trillion American Rescue Plan, which passed March 11.
Kelley said the SBA is “focused like a laser” to get the fund rolled out.
“We get it,” Kelly told the committee. “We are working as fast as we can and around the clock to get the restaurant relief program up off the ground. And so the timeframe we’re trying to go for is in the next 30 days.”
As part of the grant program, Food and drink entities with 20 locations or fewer will qualify for grants up to $10 million per company and $5 million per physical location. The grants may cover such items as payroll (excluding employee compensation exceeding $100,000 per year), employee benefits and paid sick leave; mortgage, rent, and utilities; outdoor seating construction; supplies, PPE, and cleaning materials; food; operational expenses; and debt obligation to suppliers.
The fund earmarks $5 billion for applicants with revenue of $500,000 or less and $20 billion for “eligible entities of different sizes based on annual gross receipts.” During the first 21 days, the application process will prioritize restaurants owned by women, veterans, and socially and economically disadvantaged individuals.
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Kelley said the idea would be to start posting relevant information in the next seven to 10 days and give guidance on applications and supporting documentation. The process would then move to the prioritization phase, and then a broader rollout. The official said the process “would typically unfurl over 30 to 45 days.”
The SBA is in the process of building a technology platform that’s capable of deploying hundreds of thousands of grants. The good news, Kelley said, is that the fund isn’t a typical grant program. The fund functions more like a direct payment, which lends itself to moving faster and leveraging automated systems over manual reviews.
The organization wants to work with the Office of Budget and Management to scale the platform in a way that takes advantage of ecosystem partners like third-party POS vendors to access relevant sales data.
“By drafting off [POS vendors] as well as posting our own web application, we believe we can reach the broadest market segment fast,” Kelley said.
Countless restaurants aren't sure how much longer they can hold on without more funding. A recent survey of 400 NYC operators reported that nearly 50 percent don't believe their business will survive without the proper financial aid.