Fresh Round of PPP Provides Necessary Shot in the Arm for Struggling Restaurants FOR IMMEDIATE RELEASE – December 22, 2020
Washington, DC – Last night, Congress passed a $900 billion relief bill to provide short-term economic relief to the country in the face of the coronavirus pandemic. The plan includes several items that will benefit restaurants, most importantly a second round of access to the Paycheck Protection Program (PPP), with unique provisions aimed to assist the restaurant industry, which continues to endure unparalleled job and revenue losses.
"This fresh round of PPP is a necessary shot in the arm for the restaurant industry, and that goes especially for the small, independent restaurants that are more likely to be facing imminent closure,” said Sonia Riggs, President and CEO of the Colorado Restaurant Association and incoming President of the Council of State Restaurant Associations (CSRA). “Without question, it will keep some restaurants from closing in the next couple of months, and give them resources to scratch through a very bleak winter. With restaurants in so many states facing tightening capacity restrictions and indoor dining closures, it was imperative that the industry receive substantial cash help before the end of 2020 - they can’t afford to wait another pay period, let alone until a new Administration, to receive relief. This gives many of them a bridge to survive to early next year.”
It was critical that restaurants receive meaningful cash relief before the end of 2020 if they were to have a chance at survival. The CSRA, a collective of Restaurant Associations from all 50 states plus Puerto Rico and Washington, D.C., is grateful to Congress for striking a deal, applauds the National Restaurant Association for working tirelessly to get this relief passed, and thanks State Restaurant Associations across the country for reaching out to their U.S. elected officials to press them to act as quickly as possible.
The plan passed last night targets restaurant relief with provisions including:
Enhanced PPP Loan Size: The PPP provides a business with a forgivable loan based on 2.5 times its monthly payroll costs. Restaurants, however, can seek forgivable loans based on 3.5 times monthly payroll costs.
Enhanced Access to PPP: Companies that employ a total of 300 or more employees at all locations (combined) are deemed ineligible for the PPP. Today’s bipartisan plan reflects the reality that many mid-sized and larger restaurant groups are on the verge of bankruptcy and allows restaurants to qualify for PPP as long as they do not employ more than 300 employees at each physical location.
Other provisions in the bill that will benefit restaurants include the deductibility of business expenses paid with PPP loans, enhancement of the Employee Retention Tax Credit (ERTC), extension of the augmented Work Opportunity Tax Credit (WOTC), and increased tax deduction for business meals.
While this development will give restaurants a chance at eking out a couple more months during a very grim winter, this cannot be the end of relief for the restaurant industry. Restaurants need to see more substantial relief from Washington as the Biden Administration takes power, and needs to continue to receive support as the vaccine allows recovery to begin. The CSRA and State Restaurant Associations look forward to working with the National Restaurant Association to push for more help at the federal level for this critical industry.
Restaurants have historically employed 10 percent of the U.S. workforce, and accounted for 4 percent of the country’s GDP. The COVID-19 crisis has been the most devastating challenge to this industry in living memory. According to the National Restaurant Association, the industry is on track to lose $240 billion this year, and has shed nearly 30 percent of its jobs. The National Restaurant Association also estimates that nearly 1 in 6 restaurants had closed nationwide by mid-September - and that was before many states began further reducing indoor dining or shutting down indoor dining completely.
The pandemic has been particularly difficult for independent, full-service restaurants, and this new round of relief will help extend the lives of many of the restaurants that make our communities feel like home. If we want those restaurants to survive this pandemic, we need to continue to see meaningful relief come out of Washington.
# # # # #
About the Council of State Restaurant Associations The Council of State Restaurant Associations’ mission is to foster and promote the best interests of state restaurant associations and their members by providing a network among restaurant association executives that supports the industry, member associations, and the public interest. Learn more at www.staterestaurantassociations.org
Press Contact: Laura Shunk, VP Communication, Colorado Restaurant Association firstname.lastname@example.org 347-429-0420 cell
Council of State Restaurant Associations 2055 L Street, NW Washington, DC 20036 202-973-5377 | email@example.com