Starting today, Friday, April 30, 2021, business owners can begin registering for the SBA’s Restaurant Revitalization Fund program. The fund will distribute $28.6 billion to provide emergency assistance for eligible restaurants, bars, and other qualifying businesses. This funding includes:
- $5 billion for applicants with 2019 gross receipts of no more than $500,000.
- $4 billion for applicants with 2019 gross receipts of $500,001 to $1,500,000.
- $500 million for applications with 2019 gross receipts of not more than $50,000.
Through the Restaurant Revitalization Fund program, SBA may provide funding of up to $5,000,000 per location for eligible businesses. (This is not to exceed $10,000,000 total for the Applicant and any affiliated businesses.) The minimum award will be $1,000 and SBA has stated that applications for less than $1,000 will not be accepted.
Calculating Your Fund Amount
The SBA has provided three calculation methods to determine your funding amount:
- Businesses that were already in operation prior to or on January 1, 2019, should use Calculation 1.
- For entities who began operations partially through 2019, you may elect (at your own discretion) to use either calculation 2 or calculation 3.
- Lastly, applicants who began operations between January 1, 2020, and March 10, 2021 (or who are not yet open but have already incurred eligible expenses) should use Calculation 3.
Again, keep in mind that SBA may provide funding up to $5 million per location, not to exceed $10 million total for the applicant and any affiliated businesses. Further, the minimum award is $1,000, so if your calculated funding amount is less than $1,000 you will not be eligible to apply.
Calculation 1: For applicants in operation prior to or on January 1, 2019
Funding = 2019 gross receipts minus 2020 gross receipts minus PPP loan amounts
Calculation 2: For applicants that began operations partially through 2019
Funding = (Average 2019 monthly gross receipts x 12) minus 2020 gross receipts minus PPP loan amounts
Calculation 3: For applicants that began operations on or between January 1, 2020 and March 10, 2021 and applicants not yet opened but have incurred eligible expenses
Funding = Amount spent on eligible expenses between February 15, 2020 and March 11, 2021 minus 2020 gross receipts minus 2021 gross receipts (through March 11, 2021) minus PPP loan amounts
Top Tip: For the purposes of this program, SBA has clarified that gross receipts does not include:
- Amounts received from Paycheck Protection Program (PPP) loans (First Draw or Second Draw)
- Amounts received from Economic Injury Disaster Loans (EIDL)
- Advances on EIDL (EIDL Advance and Targeted EIDL Advance)
- State and local grants (via CARES Act or otherwise)
- SBA Section 1112 payments
According to SBA, awardees will not be required to repay funds received under the Restaurant Revitalization Program unless:
- The funds were used for purposes other than for authorized purposes,
- The funds were not used by March 11, 2023, or
- The awardee permanently closed before using all funds on authorized purposes.
Allowable Use Of Funds:
If awarded, Restaurant Revitalization Funds may be used for specific expenses including:
- Business payroll costs (including sick leave)
- Payments on any business mortgage obligation
- Business rent payments (note: this does not include prepayment of rent)
- Business debt service (both principal and interest; note: this does not include any prepayment of principal or interest)
- Construction of outdoor seating
- Business utility payments
- Business maintenance expenses
- Covered supplier costs
- Business supplies (including protective equipment and cleaning materials)
- Food and beverage expenses for the business (including raw materials)
- Business operating expenses
When To Apply
Now that you’re a Restaurant Revitalization Fund expert, it’s time to go apply! Applications are now open online under the following schedule:
Days 1 through 21
SBA will accept applications from all eligible applicants, but only process and fund applications from members of Priority Groups (see below).
During this period, SBA will fund applications where the applicant has self-certified that it meets the eligibility requirements for a small business owned by women, veterans, or socially and economically disadvantaged individuals.
Open to all applicants
Days 22 through funds exhaustion
SBA will accept applications from all eligible applicants and process applications in the order in which they are approved by SBA.
SBA has provided a priority period for businesses that are at least 51% owned by one or more individuals who are women, veterans, or socially/economically disadvantaged individuals. To apply during the priority period, applicants must self-certifiy on their application that they meet eligibility requirements.
According to SBA, socially disadvantaged individuals are defined as “those who have been subjected to racial or ethnic prejudice or cultural bias because of their identity as a member of a group without regard to their individual qualities.”
Additionally, SBA defines economically disadvantaged individuals as “those socially disadvantaged individuals whose ability to compete in the free enterprise system has been impaired due to diminished capital and credit opportunities as compared to others in the same business area who are not socially disadvantaged.”
We wish you luck on your Restaurant Revitalization Fund application! For more information, be sure to check out the SBA’s Sample Application, Program Guide (this should answer any more detailed questions you have!), and other resources. And don’t forget to follow us on Facebook, Twitter, and LinkedIn for even more business tips & news!