The recently passed American Rescue Plan Act (ARPA) established a $28.6 billion Restaurant Revitalization Fund (RRF) with the Small Business Administration (SBA). The RRF will provide funding for eligible entities equal to their pandemic-related revenue loss up to $10 million per business, capped at no more than $5 million per physical location. The pandemic-related revenue loss is calculated as 2019 gross receipts less 2020 gross receipts less any PPP loan proceeds received. Recipients are not required to repay the funds from the RRF provided they are used for eligible uses no later than March 11, 2023.
Eligible entities include:
- Food stands, food trucks and food carts
- Bars, saloons, lounges and taverns
- Snack and nonalcoholic beverage bars
- Bakeries, brewpubs, tasting rooms, taprooms, breweries, microbreweries, wineries and distilleries at which on-site sales to the public comprise at least 33% of the gross receipts
- Inns at which on-site sales of food and beverages to the public comprise at least 33% of gross receipts
- Licensed facilities or premises of a beverage alcohol producer where the public may taste, sample or purchase products
All eligible establishments should register on April 30 and then apply when the application portal opens on May 3. Time is of the essence as applications will be processed on a first-in, first-out basis. However, please note that for the first 21 days the SBA will prioritize reviewing applications from small businesses owned by:
- Veterans, and
- Socially and economically disadvantaged individuals.
Register and apply through the SBA website here.
Eligible Uses of Funds
According to the SBA’s Restaurant Revitalization Funding Guide as of April 26, 2021, found here, RRF recipients may use funds for the following expenses during the covered period beginning on February 15, 2020 and ending on March 11, 2023:
- 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;
- Payments on any business mortgage obligation (both principal and interest; note: this does not include any prepayment of principal on a mortgage obligation);
- Business rent payments, including rent under a lease agreement (note: this does not include any prepayment of rent);
- Business debt service (both principal and interest; note: this does not include any prepayment of principal or interest);
- 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;
- Business maintenance expenses including maintenance on walls, floors, deck surfaces, furniture, fixtures, and equipment;
- Construction of outdoor seating;
- Business supplies, including protective equipment and cleaning materials;
- Business food and beverage expenses, including raw materials for beer, wine, or spirits;
- 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;
- 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.
Use of Funds Validation
By December 31, 2021, the applicant must report on how they used their RRF funds. If funds are not fully expended by that date, an annual report will be necessary until the funds are used in full.
Gross Receipts Documentation
Any of the following documents demonstrating gross receipts and, if applicable, eligible expenses may be submitted:
- Business tax returns (IRS Form 1120 or IRS Form 1120S);
- IRS Form 1040 Schedule C;
- For a partnership: IRS Form 1065 (including K-1s);
- Bank statements;
- Externally or internally prepared financial statements such as Income Statements or Profit and Loss Statements;
- Point of sale report(s), including IRS Form 1099-K
Get Help Filing a Restaurant Revitalization Application
To help support applicants throughout the process, SBA will offer support through a call center hotline at 844-279-8898. Please contact your DunlapSLK team member with any questions you may have.