BOSTON (WHDH) – More than 100,000 bars and restaurants across the United States have closed since the start of the pandemic. Many others struggled to stay open and were promised government money to help them. But they never got that money! Hank Phillippi Ryan is investigating.
The door to the District 7 tavern has been closed since the start of the pandemic.
Inside, the bar is empty. The pool table is covered. The televisions and the jukebox are turned off.
“It’s been a struggle to keep the lights on,” says co-owner Arianne Waldron. “We are in debt. We are drowning. The Roxbury pub struggles to find the money to reopen.
“The bills are piling up in a very overwhelming way ”, Ariane says, “How are we going to get out of this?” “
Earlier this year, she and her business partner applied for a grant from the federal “Restaurant Revitalization Fund”.
The fund had $ 28 billion that Congress set aside to help businesses like Arianne’s that have been hit hard by COVID.
“It was like, okay, this was going to be our lifeline” said Ariane.
District 7 received an email from the Small Business Administration with good news: “Congratulations, award approved. ”
“We were delighted” said Ariane.
The email promised that a grant of $ 100,000 would be in the restaurant’s bank account in “3-7 business days.”
“This money was going to save us. This money would allow us to reopen, to allow us to rehire our workers, and to be able to provide for the needs of their families ”, said Ariane.
Arianne and her partner used the email – and the promise of that money – to get a bank loan.
They started repairs, bought employee uniforms and rehired their manager.
But two weeks later, they got another email that said:
“We regret to inform you that due to recent court decisions the US Small Business Administration will not be able to disburse your Restaurant Revitalization Fund award.”
“I immediately had a stomach ache” said Ariane.
We found that the same shocking notice had been sent to almost 3,000 bars and restaurants across the country. The money they had been promised was not coming!
“Their immediate reaction was terror, despair, grief, confusion, ”said Erika Polmar, co-founder and executive director of the Independent Restaurant Coalition.
What happened? When Congress established the fund, lawmakers prioritized applications from businesses owned by women, veterans, or those who are socially and economically disadvantaged.
But then some companies took federal action to challenge that. And the judges agreed with them.
“It’s especially devastating when you think you have the price and it’s taken away from you,” Erika says.
The Independent Restaurant Coalition has been inundated with calls from business owners who have also already spent the money they were promised.
“I spoke to people who were rightly hysterical. I had never in this role called crisis counselors on the phone with people, it was just as serious and it still is, ”says Erika.
The fund then had to reconsider all outstanding requests on a first come, first serve basis and quickly ran out of money!
We found that only 36% of businesses that applied for money were ultimately approved.
And now, over 100,000 restaurants and bars – including District 7 – are still waiting for help.
“That sudden hit of that rug under our feet really left us out,” says Arianne.
There are currently bills in Congress calling for more money to be given to restaurants and bars to stay afloat. Industry experts tell 7-Investigates that if something isn’t done soon, more businesses will close and more people will lose their jobs.
FOR MORE INFORMATION:
Coalition of independent restaurants and additional resources
National Association of Restaurateurs
Boston Black Hospitality Coalition
Here are links to some of the bills pending in Congress to replenish the fund and other laws to help restaurants, bars and other food and beverage businesses:
Restaurant Revitalization Fund Replenishment Act, 2021
Information from the Small Business Administration on the Restaurant Revitalization Fund
Companies that have received money from the fund
The Small Business Administration (SBA) recounts 7 surveys:
As of June 30, 2021, the RRF program has received over 278,000 eligible submitted applications representing over $ 72.2 billion in requested funds, and approximately 101,000 applicants have been approved for restaurants, bars and other businesses in restaurant type.
Underserved populations received approximately $ 18 billion in grants, including:
- Women-owned businesses ~ $ 7.5 billion
- Veteran-owned businesses ~ $ 1 billion
- Socially and economically disadvantaged businesses ~ $ 6.7 billion
- Businesses owned by representatives of multiple underserved populations ~ $ 2.8 billion
The remainder of the $ 28.6 billion was awarded to eligible applicants not identified as part of an underserved group.
Additional economic relief is available: The SBA still administers programs such as economic disaster loans [EIDL], Advanced Targeted EIDL Programs, and Additional Targeted Advanced EIDL Programs. SBA administrator Guzman has increased the maximum amount small businesses can borrow through the EIDL program.
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