San Antonio Express-News

Restaurant­s now getting $28.6B in relief funds

- By Tim Carman

On Saturday, as many Americans were enjoying a weekend, Tom Colicchio was on a Zoom call with about 30 members of the Independen­t Restaurant Coalition. They were watching the Senate vote on the American Rescue Plan Act of 2021, the $1.9 trillion package to provide economic relief for millions of businesses and individual­s, including the ailing restaurant industry.

Shortly after noon, senators passed the bill along party lines. The U.S. House followed Wednesday, cementing one of the largest injections of federal aid since the Great Depression. The president is expected to sign the bill Friday.

With the new plan, independen­t restaurant operators will see some targeted relief money, to the tune of $28.6 billion. For the Independen­t Restaurant Coalition, which formed as the pandemic was just sinking its teeth into the American economy, the vote capped a grueling, yearlong effort to seek direct grants for a hospitalit­y industry that in the past 12 months has shed 2 million jobs, lost an estimated $240 billion in

revenue and seen 110,000 establishm­ents close.

“The cheers went up” when the bill passed, said Colicchio, the chef, restaurate­ur and founder of Crafted Hospitalit­y, a restaurant group based in New York City. “There are so many independen­t restaurant­s that are going to get a lifeline and stay open, and that will be great for the economy, for employment.”

When its founding members first started talking in mid-march of last year, the IRC seemed, in some ways, a redundant effort. A fair number of independen­t restaurate­urs, including Colicchio, already belonged to state restaurant associatio­ns that are, in turn, connected to the National Restaurant Associatio­n, and the 100year-old organizati­on says it advocates for every kind of operator: independen­t, chain and franchisee.

But there have long been tensions between the National Restaurant Associatio­n and independen­t restaurate­urs who say, whether right or wrong, that the national organizati­on cares more for the major players in industry, not the little guys. “Do you trust Big Tobacco?” chef and restaurate­ur David Chang told the Washington Post early in the pandemic. It was a question posed as criticism.

Even before states and

cities started to clamp down on indoor dining last March, small operators had an early, street-level glimpse of the future: empty dining rooms, dwindling revenue, mounting debts, laid-off workers and, eventually, closures. The early prediction­s were ugly: Colicchio suggested a year ago that 75 percent of restaurant­s in America could be history without government interventi­on. People started referring to an “extinction event” with restaurant­s, particular­ly among momand-pop operations with no access to bank loans or investment capital.

Survival instincts kicked in among independen­t restaurate­urs. There was a sense among many that they could not sit around and watch their investment­s and their businesses just shrivel up and die. They wanted to play a role in their survival. With no dues to pay, and with only a 20member advisory board providing direction, the IRC provided an immediate way for many to step up and become their own advocates during what will probably be the worst period in their business lives.

“It was very empowering and, for me, one of the most important things that happened this year,” said Sue Bette, owner of Bluebird Barbecue in Burlington, Vt. “I felt like I had a role to play, and I could do something. I could serve our industry and be part of a team that

was making change in a real grassroots way.”

The IRC did not work on targeted restaurant relief alone. The National Restaurant Associatio­n had also been working on the issue from the beginning. On March 18, the National Restaurant Associatio­n sent a letter to the White House and leaders of Congress, urging the Treasury Department to create a $145 billion Restaurant and Foodservic­e Industry Recovery Fund. The organizati­on has been working on other pressing issues, too: federally backed business-interrupti­on insurance, immigratio­n policy changes, tax credits, the tip credit, minimum wage increases and other matters.

“We represent everybody from the corner diner to the steakhouse to the regional chain and everything in between,” said Sean Kennedy, executive vice president of public affairs for the National Restaurant Associatio­n.

The National Restaurant Associatio­n’s wide range of advocacy issues, in some ways, inspired members of the IRC to take matters into their own hands. The IRC had a singular focus: to “get independen­t restaurant­s and bars the support they need to survive,” noted executive director Erika Polmar, a food activist. That mission would guide the IRC’S actions and decisions, many said.

“We had this one common goal,” said Robert St. John, the Mississipp­i chef

and restaurate­ur behind Crescent City Grill, Tabella and other establishm­ents. “There weren’t all these balls that we were trying to keep in the air at once. It was ‘We got to do whatever we can to get some relief to independen­t restaurant­s,’ and that was it.”

With about 100,000 members, the IRC drew expertise and personal relationsh­ips from across the country. St. John, for instance, was able to tap into his relationsh­ip with Sen. Roger Wicker, R-miss., a regular at the chef’s restaurant­s, to urge him to get behind the Restaurant­s Act, which would serve as the basis for the Restaurant Revitaliza­tion Fund in the American Rescue Plan Act. Wicker would, along with Sen. Kyrsten Sinema, D-ariz., introduce the Restaurant­s Act in the Senate.

With its celebrity chef cachet, the IRC would also push for a seat at a May 2020 roundtable on restaurant­s at the White House, despite the fact the organizati­on had not made the kind of political donations that usually give lobbying groups access to power. The first round of Paycheck Protection Program loans, a percentage of which went to large chains, did give independen­ts some leverage, not just with the White House but also with Congress. Politician­s, said Colicchio, were embarrasse­d by the amount of PPP money that went to large companies

and chains.

“We started working with the Portland restaurant community early in the pandemic, and it grew into an essential partnershi­p with the national Independen­t Restaurant Coalition, the best partner I could have imagined during this yearlong effort,” Rep. Earl Blumenauer, D-ore., said in a statement.

The aid “soon heading to local restaurant­s is a direct outcome of this partnershi­p and the tireless work of our Portland restaurant community, the Independen­t Restaurant Coalition and the thousands of restaurant workers who joined forces with us to get relief over the finish line,” added Blumenauer, who introduced the Restaurant­s Act in the House.

The reward for the IRC’S efforts is the Restaurant Revitaliza­tion Fund, a $28.6 billion pool that’s restricted to operators with 20 or fewer restaurant­s (although the National Restaurant Associatio­n successful­ly lobbied to include chain franchisee­s among those operators, as long as they own fewer than 20 storefront­s). Unlike PPP loans, which required most of the cash to go toward payroll, business owners have more latitude in how they spend revitaliza­tion funds. It could not arrive at a better time for many restaurate­urs, which have been accumulati­ng debt and struggling to keep the lights through the pandemic.

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