In less than two weeks, the Restaurant Revitalization Fund attracted more applications than an all-you-can eat dinner special.
The Small Business Administration, the agency overseeing the $28.6 billion grant program for hard-hit foodservice businesses, reported on Wednesday that since RRF's May 3 launch, it received more than 266,000 applications, representing more than $65 billion in requested funds. Nearly half, or 147,000 applications, came directly from women, veterans, and socially and economically disadvantaged business owners, who requested $29 billion in relief funds. That will leave hundreds of thousands of other restaurant owners out of the money.
For its first 21 days of operation, the RRF program was open only to businesses owned and controlled by women, veterans, and socially and economically disadvantaged individuals. To date, $2.7 billion of relief funds have been dished out to 21,000 restaurants. The SBA estimates that RRF awards take approximately 14 days to be reviewed and validated.
It's unclear if there's willingness in Congress to authorize additional funding, though several lawmakers, including Representatives Earl Blumenauer (D-Ore.) and Brian Fitzpatrick (R-Pa.), along with Senators Kyrsten Sinema (D-Ariz.) and Roger Wicker (R-Miss.)--the primary sponsors of the bill that initialized RRF--called for the fund to get replenished. "We need to work swiftly in a bipartisan way to replenish this critical fund so that all local restaurants can access the relief required for a full recovery," said the lawmakers in a joint statement.
The program was created by the American Rescue Plan Act, which President Biden signed into law on March 11. Congress intended for the RRF to provide food and beverage businesses with grants equal to their pandemic-related revenue losses, up to $10 million per business and no more than $5 million per location.
The SBA is opting to keep its funding portal open because there's still money available to the smallest businesses. Ahead of the program's launch, SBA administrator Isabel Casillas Guzman announced she would apportion additional set-asides to improve equitable access among businesses. In addition to the $5 billion authorized by Congress for applicants with 2019 gross receipts of not more than $500,000, the SBA put $4 billion aside for applicants with 2019 gross receipts of $500,001 to $1.5 million. The agency also set aside $500 million for applicants with 2019 gross receipts of not more than $50,000. The SBA says that last set-aside is still open to eligible borrowers.
That's little comfort to the hundreds of thousands of businesses that never even had a shot at the program. "Right now, SBA has more than $36 billion in applications from small, struggling independent businesses that will not receive funding," Sean Kennedy, the National Restaurant Association's executive vice president for public affairs, said in a statement. What's more, he added, thousands of businesses eligible to apply within the first 21 days still don't know if their applications have been approved. The SBA was unable to say how many applicants had been notified to date. A spokesperson said the agency should have final data next week.
That the program would run out of cash within the priority window was a concern from the start, said Kennedy, who noted previously that through January, the U.S. restaurant industry had lost an estimated $250 billion, and more than 110,000 U.S. restaurants closed permanently. As such, he added: "We continue to urge policymakers in Washington--from the White House to Capitol Hill--to replenish the RRF to maximize relief for small independent and franchise restaurant operators."