National Restaurant Association Throws Small, Independent Operators Under the Bus

As the fight to include the RESTAURANTS Act into the Federal COVID relief got down to the nitty gritty and GOP Senators refused to agree to grants for small restaurants, one of the most active voices in the fight, the National Restaurant Association (NRA), seemed to take their foot of the gas pedal. While the Independent Restaurant Coalition and countless organizations around the country were pleading for the grant program contained in the RESTAURANTS Act, the National Restaurant Association apparently agreed to forego grants and accept an expanded PPP program that’s a poor fit for most independent operators. And while the changes in PPP are helpful, they’re a far cry short of what we need. This statement from the Restaurant Association makes it clear they cut a deal that helps large chains at the expense of the small restaurants around the country desperate for relief:

National Restaurant Association Statement on the Pandemic Relief Bill

Today, Congress unveiled a $900 billion plan that will significantly help restaurants of all types during this critical period. The plan includes a second round of access to the Paycheck Protection Program (PPP), with unique provisions aimed to assist the restaurant industry.

From the beginning of the pandemic, the National Restaurant Association has partnered with you and hundreds of thousands of restaurant advocates to press Congress and the Trump Administration for both long-term and short-term economic support for the restaurant industry. Thanks to your efforts, this important legislation is finally moving forward.

Key restaurant specific components of the plan:

Enhanced PPP Loan Limits: The Paycheck Protection Program provides businesses with forgivable loans based on 2.5 times monthly payroll costs. Restaurants, however, would be allowed to seek forgivable loans based on 3.5 times monthly payroll costs.

Enhanced Access to PPP Program: Companies that employ 300 or more employees at all locations are deemed ineligible for the Paycheck Protection Program. Given the fact that many mid-sized and larger restaurant groups are on the verge of bankruptcy, the bipartisan plan allows restaurant groups to qualify for PPP as long as they do not employ more than 300 employees per location.

We also scored a big win with language in the bill that allows businesses to claim tax deductions for business expenses paid with PPP loans.

Restaurants will benefit from other provisions in the bill sought by the National Restaurant Association, including enhancement of the Employee Retention Tax Credit, extension of the Work Opportunity Tax Credit, and restoration of the tax deduction for business meals. You can read our full analysis of the bill here.

Our work is not finished. While this legislation represents an important down-payment on a restaurant recovery, many challenging months lie ahead. We will continue to work with you to push the new Congress in 2021 to pass comprehensive relief that will ensure all restaurants can weather this crisis long-term.

Not a single mention of the RESTAURANTS Act – just a vague call for more help. This may explain why Broadway theaters, museums, and other venues got a $15 billion grant fund and restaurants got screwed. It’s one thing when our elected officials turn their backs on us, but when your own advocates stick the knife in your back the wound is deeper and pain lasts longer.

ESRTA was extremely disappointed, to say the least, to find that the RESTAURANTS Act did not get included and the NRA didn’t put up much of a fight for the majority of the industry. We will however continue to make our case to the new Congress and White House to provide the relief that is desperately needed by small independent operators.