$28.6 Billion Restaurant Revitalization Fund Grant Program as Part of the American Rescue Plan

THE RESTAURANT REVITALIZATION FUND is a Grant Program, administered by the Small Busines Association, that must be spent on eligible expenses by no later than March 11, 2023. No Lenders will be involved. The new legislation mandated that this grant money will have no Federal Tax Implications for recipients. The Small Business Association is expected to announce the opening of the Restaurant Revitalization Fund Program soon, but the SBA is NOT accepting applications at this time. All Eligible Applicants are Strongly Encouraged to submit their RRF Applications the first day the Program Opens

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WHO IS ELIGIBLE? Eligible businesses include foodservice and drinking establishments that are not part of an affiliated restaurant group with more than 20 locations and are not publicly traded. The following are included: A restaurant, food stand, food truck, food cart, caterer, saloon, inn, tavern, bar, lounge, brewpub, tasting room, taproom, licensed facility or premise of a beverage alcohol producer where the public may taste, sample, or purchase products, or other similar place of business in which the public or patrons assemble for the primary purpose of being served food or drink. Non-profit organizations are not eligible.

TARGETED GROUPS FOR FUNDING PRIORITIZATION DURING THE FIRST 21 DAYS: The Small Business Association will prioritize awarding funds during the first 21 days to small businesses at least 51 percent owned and controlled by individuals who are women, veterans, and/or socially and economically disadvantaged individuals. Applicants in one of these categories that are operating under an approved plan of reorganization under either a Chapter 11, 12, or 13 bankruptcy and do not have a trustee exercising day-to-day control are eligible for funding under this program.

  • Applicants must self-certify on the application that they meet eligibility requirements for a small business concern owned by women, small business concern owned by veterans, or small business concern owned by socially and economically disadvantaged individuals as defined in the Appendix: Definitions in the SBA Restaurant Revitalization Fund Program Guide.
  • SBA will consider an applicant to be eligible for priority in awarding funds if the Applicant is a small business that is at least 51 percent owned by one or more individuals who are women, veterans, or socially and economically disadvantaged and if the management and daily business operations of the applicant are controlled by one or more women, veterans, or socially and economically disadvantaged individual.

For example:  An Applicant has five owners who each own 20 percent. Two owners are veterans, and one owner is a socially and economically disadvantaged individual. SBA will consider this Applicant to meet the requirement that at least 51 percent of the applicant is owned by a priority group. If an individual meets the requirements of more than one priority group category, that individual is only counted once.

HOW MUCH CAN THE GRANTS BE FOR?  A maximum grant of $10 million per restaurant group or $5 million per physical location.

HOW TO APPLY?  There Are 3 Ways to Apply for a RRF Grant:

  1. Through a recognized SBA Restaurant Partner – POS and Other Industry Technology Partners
  2. Through SBA directly at restaurants.sba.gov
  3. By phone at (844) 279-8898

IMPORTANT RESOURCES TO HELP YOU UNDERSTAND AND PREPARE FOR SUBMITTING A RRF GRANT APPLICATION:

For help in preparing your RRF Application, you can access the following SBA Assistance:
Call center support: 1-844-279-8898 (Hours: Monday-Friday 8am-8pm ET)
OR
Reach Out to Your local SBA District Office

HOW CAN THE GRANT FUNDS BE SPENT?
During the covered period of February 15, 2020 – March 11, 2023, an eligible entity that receives a grant may use the grant funds for the following expenses incurred as a direct result of, or during, the COVID–19 pandemic.

  1. Business payroll costs, including sick leave and costs related to the continuation of group health care, life, disability, vision, or dental benefits during periods of paid sick, medical, or family leave, and group health care, life, disability, vision, or dental insurance premiums;
  2. Payments on any business mortgage obligation (both principal and interest; note: this does not include any prepayment of principal on a mortgage obligation);
  3. Business rent payments, including rent under a lease agreement (note: this does not include any prepayment of rent);
  4. Business debt service (both principal and interest; note: this does not include any pre-payment of principal or interest);
  5. Business utility payments for the distribution of electricity, gas, water, telephone, or internet access, or any other utility that is used in the ordinary course of business for which service began before March 11, 2021.
  6. Business maintenance expenses including maintenance on walls, floors, deck surfaces, furniture, fixtures, and equipment;
  7. Construction of outdoor seating;
  8. Business supplies, including protective equipment and cleaning materials;
  9. Business food and beverage expenses, including raw materials for beer, wine, or spirits;
  10. Covered supplier costs, which is an expenditure made by the eligible entity to a supplier of goods for the supply of goods that:
    • Are essential to the operations of the entity at the time at which the expenditure is made; and
    • Is made pursuant to a contract, order, or purchase order in effect at any time before the receipt of Restaurant Revitalization funds; or
    • With respect to perishable goods, a contract, order, or purchase order in effect before or at any time during the covered period;
  11. Business operating expenses, which is defined as business expenses incurred through normal business operations that are necessary and mandatory for the business (e.g. rent, equipment, supplies, inventory, accounting, training, legal, marketing, insurance, licenses, fees). Business operating expenses do not include expenses that occur outside of a company’s day-to-day activities.

Note: Past-due expenses are eligible if they were incurred beginning on February 15, 2020 and ending on March 11, 2023.

HOW ARE GRANTS CALCULATED?  There are different Calculations for Restaurants open all of 2019, part of 2019, opened in 2020, and for restaurants that have not opened yet.

Calculation 1: for applicants in operation prior to or on January 1, 2019:

  • 2019 gross receipts minus 2020 gross receipts minus PPP loan amounts

Calculation 2: for applicants that began operations partially through 2019:

  • (Average 2019 monthly gross receipts x 12) minus 2020 gross receipts minus PPP loan amounts

Calculation 3: for applicants that began operations on or between January 1, 2020 and March 10, 2021 and applicants not yet opened but have incurred eligible expenses:

  • Amount spent on eligible expenses between February 15, 2020 and March 11, 2021 minus 2020 and 2021 (through March 11, 2021) gross receipts minus PPP loan amount

For those entities who began operations partially through 2019, you may elect (at your own discretion) to use either calculation 2 or calculation 3.

Our experts are here to help you navigate the Restaurant Revitalization Fund, CARES Act, PPP, ERTC and more. Book your free consult here.