The Small Business Administration’s (SBA) Restaurant Revitalization Fund (RRF)—a relief program for restaurants and other food service businesses impacted by the pandemic—went live for applications on May 3, 2021.
During the first two days of the program, the SBA reported that it received 186,200 applications from restaurants, bars and other eligible businesses, and is strongly urging interested, eligible businesses to apply as soon as possible.
Funds are available for restaurants, of course, but also many other businesses in the food service industry. Food stands, trucks and carts can apply, as well as bars, saloons, lounges and taverns, and catering companies.
In addition, the program is available to snack and nonalcoholic beverage bars, as well as “licensed facilities or premises of a beverage alcohol producer where the public may taste, sample, or purchase products,” according to the SBA. For some restaurant-like businesses, on-site sales to the public must comprise at least 33% of gross receipts. These include bakeries; inns; wineries and distilleries; breweries and/or microbreweries; and brewpubs, tasting rooms and taprooms.
All eligible food and beverage providers may apply to the RRF, but for the first 21 days, the SBA will prioritize applications owned by women, veterans, and socially and economically disadvantaged individuals. During the first two days of the application window, 97,600 of the 186,200 applications received by the SBA were reported to be businesses owned by women (46,400); veterans (4,200); socially and economically disadvantaged individuals (30,800); or some combination of the three (16,200).
After the first 21 days of the application window, the SBA will fund all eligible applications on a first-come, first-served basis.
Under the American Rescue Plan Act, the RRF received a total of $28.6 billion in direct relief funds for restaurants and other similar establishments that have suffered economic hardship and substantial operational losses because of the COVID-19 pandemic.
The dollar amount an eligible business can receive under the RRF will equal its decrease in gross revenues during 2020 compared to gross revenues in 2019—less the amount of any Paycheck Protection Program (PPP) loans received. Other funding amounts that must be excluded from 2020 gross receipts include:
- SBA Section 1112 debt relief,
- SBA Economic Injury Disaster Loans,
- SBA advances (targeted and otherwise), and
- Local small business grants.
Overall, the RFF may provide a qualifying establishment with funding equal to its pandemic-related revenue loss up to $10 million per business and not more than $5 million per physical location. Recipients must use funds for allowable expenses, such as payroll and rent, by March 11, 2023.
A timely, properly completed application is critical to acquiring this funding. An applicant business must submit documentation of its 2020 and 2019 gross receipts, as well as at least one of the following:
- A federal tax return,
- A point of sale report, or
- Externally or internally prepared financial statements.
Applicants will also need to disclose the amount of any PPP loans received.
To get started, applicants may register for an account at restaurants.sba.gov. The SBA advises applicants to first download a sample version of the application here. Our firm can help you gather and submit any necessary documentation and navigate the application process.
If you have questions about the RRF or how to apply, leave a comment below or reach out to me directly, I’m happy to help!