By Kathy Bazan, BRC Small Business Consultant
The Restaurant Revitalization Fund (RRF) is the largest targeted financial relief program focused on the restaurant industry in the history of the United States.
Is this a grant (free money), a forgivable loan, or a loan?
The RRF is a grant which you do not pay back. The Paycheck Protection Program (PPP) is a forgivable loan while the Economic Injury Disaster Loan (EIDL) is a loan which you pay back.
If you win an RRF grant, you can spend the money wherever it may be needed such as any operating expenses or debt repayment.
How is the amount of the grant calculated?
Your grant amount is the difference between your 2019 and 2020 gross sales minus any PPP loans you received. Know how much your gross sales decreased when you compare the 2020 calendar year compared to 2019.
What are the tax consequences?
If you win this grant, you will not need to include the amount in your 2021 gross income AND you can still deduct from your taxes any eligible expenses you paid from your grant.
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Since the SBA has not announced when they will accept applications, it is wise to check the website twice each day to get your application in as soon as possible. (Best guess is that the portal may accept applications for the first time between April 23 and April 30 and then operate until the SBA allocates all of the $28.6 billion in the fund.)
Businesses eligible to apply include:
- Restaurants, bistros, coffee bars, food stands
- Snack and nonalcoholic beverage bars
- Mobile food businesses (food trucks and food carts)
- Drinking establishments (bars, saloons, lounges, taverns)
- At the licensed facilities or premises of a beverage alcohol producer where the public may taste, sample, or
- Onsite sales to the public comprise at least 33% of gross receipts for the following businesses:
- Brewpubs, breweries and/or microbreweries, taprooms
- Wine tasting rooms
- Wineries and distilleries
How are the grants allocated?
- $500 million in grants is reserved for applicants who had 2019 gross receipts of no more than $50,000 in purchased products.
- $5 billion is reserved for applicants with 2019 gross receipts up to $500.000.
- $4 billion in grants is reserved for applicants whose 2019 gross receipts ranged from $500,001 to $1,500,000.
Where can you get help with your application?
- Kathy Bazan, Business Recovery Center Small Business Consultant firstname.lastname@example.org or (503) 692-0780. By appointment only. Open Monday-Friday 8 AM-5 PM. All consultations are at no cost to you and are confidential.
- SBA Call Center 1-(844) 279-8898 is open from 5 AM to 5 PM PST Monday-Friday to answer questions. To climb the phone tree quickly to talk to a real, live person, hit “6” when it connects. Si hablas espanol, presiona 8. If you need one of the other 51 languages, hit option 9 in the phone tree.