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New $120bn hospitality fund could help US bars
New legislation that provides a US$120 billion fund to support struggling bars and restaurants has been passed by the US House of Representatives and is now awaiting approval from the Senate.
The Restaurants Act has passed the House of Representatives and will be heard before the Senate
The Real Economic Support That Acknowledges Unique Restaurant Assistance Needed To Survive (Restaurants) Act aims to establish a US$120 billion fund to support bars, restaurants and other service venues affected by the coronavirus pandemic.
Specifically, the programme is targeted at smaller venues that are not publicly traded or part of a chain with 20 or more locations.
Under the act, the Restaurant Revitalization Fund would be set up by the US Treasury, which would provide structured relief to drinking and food service establishments until 31 December 2020.
Grants awarded through the act would prioritise “marginalised and underrepresented communities”, with a focus on women- and minority-owned businesses. The fund will also only be available to businesses with annual revenues of less than US$1.5 million.
The funds are to be used to support payroll costs, rent payments, utilities, maintenance costs, supplies, food and drink, and any other “essential” expenses.
The act, which was initially sponsored by Democratic representative Earl Blumenauer, has so far received 209 co-sponsors as it passed through the House of Representatives. The bill must now gain the approval of the Senate before it can be signed into law by president Donald Trump.
The progress of the bill has been welcomed by the Wine & Spirits Wholesalers of America (WSWA).
Michelle Korsmo, president and CEO of WSWA, said: “America’s wine and spirits wholesalers are witnessing firsthand the daily struggles of their restaurant partners as they work around the clock to stay in business – if they’re even permitted to open their doors – making the Restaurants Act a good first step in providing relief to an industry in crisis.
“There is no doubt that the road to recovery for the hospitality sector is a long one. It could take years for our on-premise partners to reach the economic stability they maintained prior to sweeping closures and limitations to operations due to Covid-19 – if they are able to survive the pandemic at all.
“While we applaud this effort, we encourage Congress to fully reinstate the business meals expense deduction to help establishments survive in the long term, especially for a hospitality industry in crisis and for which such activity is a daily part of doing business.”