Plan urges targeted relief fund, liability protections, payroll tax relief for workers and other measures
The National Restaurant Association urges a new targeted relief fund for operators with 20 or fewer units, liability protections, payroll tax relief for industry workers and other measures in its new “Blueprint for Restaurant Revival,” sent to Congress Wednesday.
The Washington, D.C.-based trade group called the blueprint a “comprehensive policy and legislative plan” for actions the federal government should take to stabilize the industry, which has been hit deeply by the coronavirus pandemic, and provide relief in the short-term and build a foundation for long-term rebuilding.
“In just the past two weeks, state and local government mandates have shut down almost 100,000 restaurants,” said Sean Kennedy, executive vice president of public affairs for the association, in a statement. In that period, coronavirus cases and hospitalizations surged in states ranging from California and Arizona to Texas and Florida and led local governments to pull back on reopening plans, which had begun in May.
In the first three months of the COVID-19 pandemic, which was declared in March, restaurant and foodservice sales likely fell more than $120 billion from the same period last year, the association had said, and the industry expected to sustain $240 billion in losses for the year. As of April 20, the association estimated more than 8 million of about 15.6 million foodservice industry workers had been laid off or furloughed.
“Despite losing more jobs and revenue than any other industry in this country, Congress has chosen not to advance a recovery package that is tailored for the unique challenges of a restaurant on the cusp of bankruptcy,” Kennedy said.
The association’s 10-page Blueprint focuses on areas where Congress could act to support restaurants of every size and operational model in communities across the country.
The association said federal lawmakers should:
- Offer short-term relief by creating a targeted Restaurant Recovery Fund. The NRA worked with Sen. Roger Wicker (R-Miss.) and Sen. Kyrsten Sinema (D-Ariz.) to establish a $120 billion fund to provide Treasury Department grants to businesses that operate 20 or fewer establishments.
Grants, capped at $10 million, could be used to cover costs ranging from payroll, benefits, mortgages, rent, supplies, protective equipment and cleaning materials. The association urged the U.S. House to endorse the Senate bill, 4012, also known as the “Real Economic Support That Acknowledges Unique Restaurant Assistance Needed to Survive Act,” or RESTAURANTS Act.
- Create a second round of Paycheck Protection Program, or PPP, funding and eligibility, which the association recommended be tied to a 20% reduction in gross receipts, and a streamlined forgiveness process.
- Make expenses paid with forgiven PPP loans tax deductible, which is not currently allowed under Internal Revenue Service rules.
- Provide a long-term loan program beyond the PPP to provide at least six months of expenses and allow for partial forgiveness.
- Expand the Employee Retention Tax Credit (ERTC) to help restaurants get support after a PPP loan has run out.
- Expand working capital through the Economic Injury Disaster Loan, or EIDL, program by replenishing funding and creating an EIDL advance grant for businesses with major revenue reductions.
- Address business interruption insurance claims for small businesses. “The refusal of coverage by insurers has proven devastating for some businesses and their employees,” the association said in its Blueprint. “Without federal support, pandemic insurance will be very expensive and difficult to find, putting it out of reach for most businesses.”
- Shield businesses from some liability. “Because the COVID-19 crisis is a global pandemic, and not caused or spread by any one type of business or employee, Congress should enact temporary and targeted liability protections,” the association said. “These protections should still allow for claims based on willful misconduct by bad actors as well as for violations of food, safety and workplace laws.”
- Ensure the stability of the food-supply chain by prioritizing food and agriculture employees for testing and receipt of a COVID-19 vaccine when one becomes available.
- Enact payroll tax relief for restaurant employees as essential workers.
In addition, the association said the government should help restaurants support communities by funding programs to feed at-risk populations and provide greater access to restaurant meals for low-income Americans.
“The restaurant industry is one of tenacity, innovation, and dedication to serving our community,” Kennedy said. “We are looking to Congress not only for support for our short-term survival, but to create a long-term framework that sustains our role as a key part of the food supply chain for the millions of families that rely on us for nourishment.”
The National Restaurant Association was founded in 1919 and includes about 1 million restaurant and foodservice outlets.
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