- Eighty-two percent of independent restaurants are concerned they may close permanently without a refill of the Restaurant Revitalization Fund, the Independent Restaurant Coalition shared in a virtual press conference Thursday.
- The IRC released this data a few hours before the House Committee on Small Businesses met to discuss budget reconciliation. The committee voted to advance $25 billion in investment for small businesses on Thursday, but didn't vote on a bill that would inject $60 billion into the fund.
- Financial pressure on independent restaurants has intensified since the RRF closed to new applicants in May. According to the IRC, hundreds of thousands of independent restaurants could shutter without new federal aid.
Erika Polmar, the executive director of the IRC, said in the virtual press conference that higher costs and lost revenues due to COVID-19 restrictions have caused "an extinction event for a large portion of this industry."
Surviving restaurants are struggling. An email survey carried out by the IRC found 85% of restaurant operators had received no money from the RRF. The fund, set up by Congress as part of the American Rescue Plan, was tasked with distributing $28.6 billion in grants to restaurants. Within three weeks, restaurant owners applied for more than $69 billion in aid, leaving more than $40 billion in grant requests unfulfilled as restaurants scramble to pay for expenses.
Rent data collected by Alignable shows 45% of restaurants couldn't pay August rent, a 5% increase over July. The extended pandemic crisis has also begun to impact the availability of credit for independent restaurants, the IRC claims. Eighteen percent of independent operators said their credit scores had fallen below 570, leaving many of them unable to take on new loans as new dining restrictions squeeze business.
"The situation is more urgent than at any point in the pandemic," Tyler Akin, a co-founder of the IRC and restaurant owner in Philadelphia, said during the virtual press conference.
The RRF gave priority to applications filed by restaurants operated by women, veterans and racial minorities, until judges issued injunctions on the disbursement of the funds. As a result, the Small Business Administration rescinded grant approval from nearly 3,000 restaurants, leaving operators in turmoil.
Congressional records show the bill to refill the RRF currently has 218 co-sponsors, a majority of the chamber, and was referred to the House Committee on Small Business in June. The House Small Business Committee has not said when, or if, they will discuss refilling the RRF as part of the reconciliation process.