Catersource is part of the Informa Connect Division of Informa PLC

This site is operated by a business or businesses owned by Informa PLC and all copyright resides with them. Informa PLC's registered office is 5 Howick Place, London SW1P 1WG. Registered in England and Wales. Number 8860726.

RESTAURANTS Act of 2021 Reintroduced

The $120 billion RESTAURANTS Act of 2021 has been reintroduced to Congress as a bipartisan, bicameral effort from Sens. Roger Wicker (R-Miss.) and Kyrsten Sinema (D-Ariz.), and Reps. Earl Blumenauer (D-Ore.) and Brian Fitzpatrick (R-Pa.).

According to Nation's Restaurant News*, the reupped legislation is modeled after the bill introduced last Congressional session (and passed by the House in October) and would create a $120 billion fund to provide relief for foodservice businesses with less than 20 units. Business operators would be able to apply for grants up to $10 million to cover expenses incurred during the pandemic, retroactive to Feb. 15, 2020, and would end eight months after being passed into law, according to the Independent Restaurant Coalition.

The reintroduced bill includes some changes from the last version and unifies previous bills from the Senate and House under a common language. One of the changes includes clarification of who is eligible for relief, which now includes franchise owners.

Here is what we know so far about the 2021 version of the RESTAURANTS Act legislation that was originally proposed by Rep. Earl Blumenauer (D-Or.) during the last Congressional session and passed by the House in October:

  • The $25 billion round of funding would be divided into government-funded grants with a maximum of $10 million per restaurant group or $5 million per individual restaurant location.
  • Eligible businesses include foodservice and drinking establishments like restaurants, bars, caterers, breweries, taprooms, and tasting rooms that are not part of an affiliated restaurant group with more than 20 locations. Participants cannot be publicly traded and there are limits on private equity firms. Participants also cannot currently be an applicant for the Shuttered Venues Operators grant program.

Just this week, prominent Hudson Valley caterer Michael Bonura was able to participate in a call with senior staff at Senate Majority Leader Chuck Schumer’s office, regarding the current status of the 2021 Unified RESTAURANTS Act. During the discussion relating to how foodservice entities would qualify for support from this bill, it was noted that the current proposal is that the funding would be offset not only by EIDL loans and PPP 1 funding, but also offset by the more recent PPP 2 funding as well.

While the RESTAURANTS Act does offer some hope for the hospitality industry, some of the language is problematic.

According to Leading Caterers of America President Carl Sacks: "We strongly believe that this PPP 2 offset makes little sense, since that funding was approved for 2021, whereas the Restaurants Act is designed to provide compensation for the 2020 losses. To that end, we’d strongly recommend that any and all caterers reach out to their congressional representatives, and encourage them to support modification of this bill to limit the PPP offsets to the first PPP draw last year."

The specific language in the markup of the bill that caterers are objecting to reads:

Section 6003 SUPPORT FOR RESTAURANTS 7 D ii

For purposes of this paragraph, the pandemic-related revenue losses for an eligible entity shall be reduced by any amounts received from a covered loan made under paragraph (36) or (37) of section 7(a) of the Small Business Act (15 U.S.C. 636(a)) in 2020 or 2021. 

"This sentence refers to the PPP Loans. We are proposing, and encourage you to request, that they delete 'or 2021,'" Sacks said. 

Read the full Restaurants Act here.

 

*The publication, Nation's Restaurant News is owned and operated by Informa Connect, Catersource’s parent company. 

 

Catersource

Catersource includes an annual conference, tradeshow and magazine, online presence, e-newsletters, the Art of Catering Food conference, and Leading Caterers of America Executive Summit. Click here for conference information. Click here to sign up for any of our free e-news products or the quarterly issue of Catersource magazine.