Restaurant Revitalization Fund

Cynthia D. Stelzer, Esq.

May 2021

Commercial landlords whose restaurant and bar tenants have not paid rent should make sure their tenants are aware of the $28.6 billion Restaurant Revitalization Fund.  Under this Federally funded program, the U.S. Small Business Administration (“SBA”) is awarding funding to restaurants, bars and other places of business that serve food or drink.  The purpose of the funding is to provide support to eligible companies that suffered revenue losses related to the COVID-19 pandemic.  Applications should be submitted immediately, as the Restaurant Revitalization Fund will stop accepting applications on Monday, May 24th at 8 pm.

For more information about the Restaurant Revitalization Fund, see https://www.sba.gov/funding-programs/loans/covid-19-relief-options/restaurant-revitalization-fund.

Calculation of Funding Amount

SBA may provide funding of up to $5,000,000 per location (not to exceed $10,000,000 total for the applicant) for applicants who meet eligibility requirements.  There are four distinct calculations to determine how much funds an applicant will receive from SBA.  It depends on when the applicant was operating its business: (1) applicants that were in operation prior to January 1, 2019; (2) applicants making sales partially through 2019; (3) applicants that began operations on or between January 1, 2020 and March 10, 2021 (including applicants that have not yet opened for sales but as March 11, 2021 have incurred eligible expenses); and (4) applicants that operate multiple locations.

Eligible Entities

Eligible entities are businesses that are not permanently closed and include businesses where the public assembles for the primary purpose of being served food or drink.  Some examples of eligible entities include: restaurants, food stands/trucks, caterers, bars, snack bars, bakeries, tasting/taprooms, breweries, wineries or inns.  In order for bakeries, tasting/taprooms, breweries, wineries to be eligible, these businesses must provide documentation that shows their on-site sales to the public comprised at least 33% of gross receipts in 2019.  In order for inns to be eligible, these businesses must provide documentation that on-site sales of food and beverage to the public encompassed at least 33% of gross receipts in 2019.

Eligible Uses of Funds

Businesses must use the funds for specific expenses:

  • Payroll costs, including health care
  • Payments made on any business mortgage obligation
  • Rent payments
  • Business debt service
  • Utility payments such as electricity, gas, water, telephone or internet access
  • Maintenance expenses such as maintenance on walls, floors, decks, furniture, fixtures and equipment (“FF&E”)
  • Construction of outdoor seating
  • Business supplied and cleaning products
  • Food and beverage expenses including raw materials for beer, wine and spirits

Expenses are eligible if they were incurred between February 15, 2020 through March 11, 2023.

How to Apply

There are three ways to apply for the Restaurant Revitalization fund:

  • Through a recognized SBA Restaurant Partner*
  • Through the SBA at restaurants.sba.gov
  • Telephonically at (844) 279-8898

* The SBA developed partnerships with recognized technology companies that provide software, hardware and payment services to the restaurant industry to ensure wide and equitable distribution of relief.  These companies are referred to as “Restaurant Partners.”

Please contact Cynthia Stelzer with any questions regarding this alert at cynthia.stelzer@kts-law.com or 800-574-5587.

Kimball, Tirey & St. John LLP is a full service real estate law firm representing residential and commercial property owners and managers. This article is for general information purposes only. While KTS provides clients with information on legislative changes, our courtesy notifications are not meant to be exhaustive and do not take the place of legislative services or membership in trade associations. Our legal alerts are provided on selected topics and should not be relied upon as a complete report of all new changes of local, state, and federal laws affecting property owners and managers. Laws may have changed since this article was published.  Before acting, be sure to receive legal advice from our office. For contact information, please visit our website:  www.kts-law.com.  For past Legal Alerts, Questions & Answers and Legal Articles, please consult the resource section of our website.

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