With some counties in Washington State moving back phases and the restaurant crowd starting out a bit skittish for the summer, the American Rescue Plan Act has established a Restaurant Revitalization Fund (RRF). The RRF can provide up to $5MM per physical location and up to $10MM total for pandemic-related revenue losses. The RRF is a forgivable loan so long as it is used for eligible expenses no later than March 11, 2023.
If you’re a restaurant, food truck, bar, tavern, brewpub, distillery with onsite sales to the public, a winery with onsite sales to the public, or similar you might qualify for the RRF.
The application is a bit complicated and involves a lot of math, so ask your CPA or bookkeeper for help. Basically, you will need to show that:
- You have paid taxes;
- Know your gross revenue and have access to all tax statements and P&L records; and
- Had onsite sales to the public.
You can review a real application here: SBA Form 3172. You can also apply through POS vendors directly such as through Square or Toast. In other words, if you have Square, you can use the Square portal to apply for the RRF.
Calculations for the loan amount range as follows:
- 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 gross receipts minus 2021 gross receipts (through March 11, 2021) minus PPP loan amounts
REGISTRATION ON THE SBA PORTAL OPENS TOMORROW, APRIL 30, 2021 AT 9 AM EASTERN TIME. APPLICATIONS OPEN MONDAY MAY 3, 2021 AT 12 PM EASTERN TIME.
You can get priority status if you are a woman or veteran-owned business or are socially or economically disadvantaged (racial, ethnic, or cultural bias).
IF you receive RRF funds, you can use them for:
- Business payroll costs (including sick leave)
- Payments on any business mortgage obligation
- Business rent payments (note: this does not include prepayment of rent)
- Business debt service (both principal and interest; note: this does not include any prepayment of principal or interest)
- Business utility payments
- Business maintenance expenses
- Construction of outdoor seating
- Business supplies (including protective equipment and cleaning materials)
- Business food and beverage expenses (including raw materials)
- Covered supplier costs
- Business operating expenses
Additional information about the RRF can be found on the SBA website at Restaurant Revitalization Fund (sba.gov) or contact a Gravis Law, PLLC attorney for additional information and/or help with the application.