President Biden called the newly launched Restaurant Revitalization Fund "badly needed" Wednesday as he continues to tout the implementation of the American Rescue Plan. The application process for the $28.6 billion in funding for restaurants, bars and other small food and beverage businesses hit hard by the coronavirus pandemic launched Monday.
"Restaurants are more than a major driver in our economy, they're woven into the fabric of our communities," Mr. Biden said. "And so for many families restaurants are the gateway to opportunity, a key part of the American story."
The restaurant industry has been disproportionately affected by the COVID-19 pandemic. Nearly half of workers in the industry lost their jobs in the first few months of the pandemic. And while the United States continues to recover, the industry remains down 1.8 million jobs from February of last year.
"We're opening the doors of this program so that restaurants all over the country can open their doors again," Mr. Biden said. The president said the U.S. is relying on restaurants to play a big role in the economic recovery. "We want our economy to recover in a way that deals everyone in. And our restaurants need a seat at the table," he said.
In the first two days of the newly launched program, 186,200 restaurants, bars and other businesses applied for relief, according to data released by the administration. The applications included businesses from all 50 states, the District of Columbia and five U.S. territories. Such businesses would be able to use the money for expenses like payroll and rent.
Mr. Biden said some have argued the federal stimulus American Rescue Plan was not needed, but the many applications already submitted for the fund show it was "badly needed." According to the Independent Restaurant Coalition, which advocated for the funds, nearly 1 in 3 restaurants and bars applied for money in the first 48 hours.
While all small businesses are able to apply, the Small Business Administration is prioritizing businesses owned and controlled by women, veterans and other socially or economically disadvantaged individuals for the first 21 days of the program. In the first two days, 97,600 applications from such business owners were submitted according to the White House.
After the first 21 days, all eligible applications will be funded on a first-come, first-serve basis. Applicants can apply for grants equal to their pandemic-related losses, with up to $10 million per business group and $5 million per location.
As part of the Restaurant Revitalization Fund, the administration is also prioritizing relief for the smallest restaurants and bars. $9.5 billion has been set aside from the fund for bars and restaurants including $4 billion for applications for businesses whose revenues were between $500,000 and $1.5 million in 2019, $5 billion for those businesses whose receipts did not surpass $500,000 in 2019, and $500 million for businesses who brought in no more than $50,000 in the year before the pandemic.
Of the applications received in the first two days of the program, roughly a third, or 61,700, came from businesses with less than $500,000 in annual revenue before the pandemic, representing some of the smallest businesses in the country.
The White House said Wednesday that funds for recipients who applied this week are slated to start going out on average about 14 days from the time an application is submitted. Press Secretary Jen Psaki called it a "very rapid turn around."
Mr. Biden had earlier Wednesday visited the Washington, D.C. restaurant Taqueria Las Gemelas for lunch. Due to COVID-19, the business went from 55 employees to seven. It is now a recipient of the Restaurant Revitalization Fund pilot program. Funds for the pilot program are expected to be delivered Friday.
The visit comes as the bipartisan Paycheck Protection Program, which has been operating for more than a year, has exhausted all funds. That program was extended in March through the end of May. The Small Business Administration will continue to fund approved applications.
The Restaurant Revitalization Fund as part of the American Rescue Plan, which passed relying on deficit spending. The Biden administration is pushingwhich would rely on proposed tax hikes targeting major corporations and the wealthiest Americans.