March 8, 2021 — Derek Wolman, Chair of our Hospitality & Restaurant Law practice reports that over the weekend, the U.S. Senate passed the American Rescue Package, which includes $28.6 billion dedicated for restaurant relief to save restaurants, bars, and jobs. The Restaurant Relief Fund was enacted last month by Senate Majority Leader Chuck Schumer and the New York City Hospitality Alliance.
Below is a summary of the Restaurant Relief Fund that will be included in the American Rescue Package that the House of Representatives is expected to pass on Tuesday, before sending it to the President for his signature.
- The measure would provide $25 billion for a Restaurant Revitalization Fund to be administered by the SBA.
- Eligible recipients would include restaurants, bars, food trucks, and caterers, including businesses in airport terminals and tribally owned entities.
- Disqualified businesses include those run by the state or local governments, companies that manage more than 20 locations including affiliates, live venues seeking grants under the year-end Covid-19 relief package, and publicly traded companies.
- Grant amounts would cover the difference between an entity’s revenue in 2020 compared with 2019.
- Awards would be reduced by amounts received through the Paycheck Protection Program.
- Aggregate awards made to an entity and its affiliates can’t exceed $10 million and would be limited to $5 million per location.
- Expenses include payroll costs, mortgage and rent payments, supplies, normal food and beverage costs, and paid sick leave.
Grants can’t be used to pay fees exceeding of certain private funds with an ownership stake. Funds could be used through December 31, or a date set by the SBA that’s no later than two years after the measure’s enactment.
DHC’s Washington, D.C. office is continuing to work with Senate Majority Leader Chuck Schumer and Congress on the American Rescue Package and will continue to provide updates as the legislation moves forward.