The Small Business Administration has published details about the Restaurant Revitalization Grants (RRG) program. RRG became public law on March 11th, as part of the American Rescue Plan Act. The program appropriated $28.6 billion for the SBA to issue grants.
The program will award between $1,000 and $5 million to each eligible restaurant location, up to two locations per restaurant owner, while funds are available. Eligible eateries include restaurants, food stands, food trucks, food carts, caterers, and other places in which the public assembles to consume food.
Bakeries, brewpubs, tasting rooms, taprooms, breweries and the like are eligible if they can provide documentation that at least 33% of their gross receipts in 2019 were for on-site sales.
How are the grants computed? It’s actually pretty simple. Subtract 2020 gross receipts from 2019 gross receipts and deduct any Paycheck Protection Program (PPP) loans received. That’s the potential amount of the grant, limited to $5 million per physical location. In general, the more your revenue dropped in 2020 as compared to 2019, the more your restaurant will be eligible for.
There are alternative calculations for restaurants that were only partially open in 2019 or that began operations in 2020 by March 10th.
Funds can be used for payroll, mortgages, rent, employee benefits, utilities, supplies, food and beverages and other costs of doing business. Funds must be used by March 11, 2023.
The program is only available to restaurants that are open. The program does not apply to publicly traded companies, though franchises are eligible.
Applications will be opening soon at restaurants.sba.gov.
