The House of Representatives passed President Joe Biden’s $1.9 trillion COVID relief bill Wednesday, which will now head to the president’s desk for signature. 

The passage comes almost two months after Biden first announced the plan. The legislation, otherwise known as the American Rescue Plan, includes the Restaurant Revitalization Fund, or $28.6 billion in direct grants for small and independent restaurants. 

“This is a story about people who came together that decided that we’re going to  help each other and the entire industry,” said Tom Colicchio, owner of Craft Hospitality and co-founder of the Independent Restaurant Coalition, in a statement. “The Independent Restaurant Coalition did not exist a year ago…when you think about doing what we did in a year, [This bill] is unprecedented. Every single person on this call. Every single member of the IRC. I love these people. I would go to war with them.”

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.

For restaurants established prior to 2019, the grant will equal 2019 revenues minus 2020 revenues. For concepts that opened in 2019, the grant will equal the average of 2019 monthly revenues times 12, minus 2020 revenues. Restaurants that opened in 2020 will be eligible to receive funding equal to eligible expenses. 

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.

Restaurants that receive grants may use the funds for expenses from February 15, 2020, through December 31. The period may be extended two years from enactment if conditions warrant. The money can be used in conjunction with any government disaster loans and employee tax retention tax credits that a company has received since the beginning of the pandemic. If a restaurant received a Paycheck Protection Program loan, the amount of that loan will be subtracted from the eligible grant total received from the Restaurant Revitalization Fund. 

The Small Business Administration will take time to set up rules for the fund, after which applications will be made available. Restaurants must certify that current economic conditions make the grant request necessary, that funds will be used appropriately, and that they will only apply for and receive one grant. Any unused grant money must be returned to the federal government. 

“Today Congress spoke with one voice in support of the restaurant industry,” said Sean Kennedy, the National Restaurant Association’s executive vice president of public affairs, in a statement. “The Restaurant Revitalization Fund will keep doors open in restaurants large and small in every community. We thank the leadership of Speaker Nancy Pelosi and Majority Leader Chuck Schumer in guiding this legislation, and the bipartisan efforts of Sens. Roger Wicker and Kyrsten Sinema and Reps. Earl Blumenauer and Brian Fitzpatrick. Their work in refining the RESTAURANTS Act on behalf of all restaurants gives chefs, owners, and employees around the country new hope.”

The Restaurant Revitalization Fund is derived from the RESTAURANTS Act, a $120 billion fund proposed last year. In the fall, the House of Representatives passed a $2.2 trillion stimulus package that included the multi-billion dollar fund. However, the bill received no attention in what was then a Republican-controlled Senate. 

The American Rescue Plan also includes $1,400 checks that phase out between incomes of $75,000 and $80,000, a weekly unemployment boost of $300 through early September, $350 billion for state and local governments, $130 billion to reopen K-12 schools, expansion of the child tax credit of up to $3,600 per child, and more than $75 billion for COVID testing and vaccine rollout. The bill also adds $7.25 billion in funding for the Paycheck Protection Program. Since its rollout last year, the program has disbursed roughly $678.7 billion, with about $120 billion left in the latest round of funding. The program is set to expire at the end of March.

The legislation underwent a process called budget reconciliation, which allowed Democrats to approve the bill without needing votes from any Republican lawmaker. Indeed, The COVID legislation was passed without GOP support in both the House and the Senate. 

In the initial stages, the American Rescue Plan included a $15 minimum wage increase in phases. However, the Senate parliamentarian said the provision must be removed because it doesn’t fit with budget reconciliation rules, which state that all parts of the bill must affect the budget in some way. The deletion made the legislation easier to pass as a handful of Democrats weren’t in favor of the hike—key votes that were needed to pass the overall bill. 

Legal, Story