Big restaurant chains take $30M in coronavirus loans meant for small businesses

Large restaurant chains have gobbled up $30 million in federal loans meant to shore up small businesses during the coronavirus crisis. The companies behind Potbelly Sandwich Shop and Ruth’s Chris Steak House each got sizable loans under the feds’ Paycheck Protection Program, the $349 billion small-business aid package that ran out of money Thursday. Florida-based steakhouse operator Ruth’s Hospitality Group inked deals April 7 for $20 million in loans administered by the US Small Business Administration under the $2.2 trillion coronavirus stimulus bill passed last month, records show. And Chicago-based Potbelly Corporation got a $10 million loan from the program on April 10, the company said in a regulatory filing. Both firms said they received the money through JPMorgan Chase Bank.

The so-called PPP loans were aimed at helping companies with up to 500 employees cover payroll and overhead costs. But lawmakers expanded eligibility for restaurants so that companies could apply as long as they had no more than 500 workers at any single location. That apparently paved the way for Ruth’s and Potbelly — which employ about 5,700 and 6,000 people, respectively — to dip into the limited pot of money.

Government watchdogs reportedly cried foul at the fact that such big restaurant firms got through the loan pipeline while many small businesses were left waiting for Congress to approve more money for the program. “What a slap in the face to the untold thousands of legitimate small businesses that will not survive this crisis, many because they couldn’t get the help they were promised from the president soon enough, if at all,” Derek Martin of the watchdog group Accountable.US told Politico, which earlier reported on the Potbelly and Ruth’s loans. “Like many other restaurants, Potbelly applied for the PPP,” Potbelly’s chief people officer, Matt Revord, said in a statement. “Every penny will be used to financially support the employees in our shops. Congress specifically qualified restaurants for the PPP loan program because restaurant workers are vital to our economy.” Ruth’s didn’t respond to requests for comment on Friday.

https://nypost.com/2020/04/17/potbellys-ruths-chris-snag-coronavirus-loans-meant-for-small-business/

As usual the Congressional Lawmakers created this mess. Wonder what if anything they get out of this.

>>8862128

Shake Shack to return $10 million meant for small businesses during pandemic

Burger giant Shake Shack plans to return $10 million it received from a government loan program meant to protect small businesses during the coronavirus crisis. The New York-based fast food chain was one of several large restaurant companies that got a multi-million-dollar loan through the Trump administration’s $349 billion Paycheck Protection Program aimed at helping struggling small firms pay workers amid the pandemic. Many merchants were left waiting for a lifeline when the program ran out of money last week. Shake Shack decided to return its loan because it found a way to raise money through a public stock transaction instead, CEO Randy Garutti and chairman Danny Meyer said Sunday. They urged Congress to put more money into the program and prioritize businesses with limited access to outside funds. “It’s inexcusable to leave restaurants out because no one told them to get in line by the time the funding dried up. That unfairly pits restaurants against restaurants,” Garutti and Meyer said in a LinkedIn post. “This industry rises and falls together.”

More than a dozen big publicly traded firms like Shake Shack — which has 189 US restaurants and nearly 8,000 employees — got PPP loans, even though the program was targeted at businesses with up to 500 workers, according to Bloomberg News. Others included coal-mining company Hallador Energy, cruise operator Lindblad Expeditions and the firms behind Potbelly Sandwich Shop and Ruth’s Chris Steak House, the news agency reported Sunday.

Shake Shack decided to apply for a PPP loan because chains were eligible for funding if each location had fewer than 500 workers, Meyer and Garutti said. Union Square Hospitality Group, Meyer’s restaurant conglomerate that helped start Shake Shack, also sought money after closing its eateries and laying off more than 2,000 people, they said.

“The ‘PPP’ came with no user manual and it was extremely confusing,” Garutti and Meyer wrote. “The best chance of keeping our teams working, off the unemployment line and hiring back our furloughed and laid off employees, would be to apply now and hope things would be clarified in time.” House Speaker Nancy Pelosi said Sunday that Congress was “very close” to reaching a deal for more small-business loan money. Republican lawmakers have been pushing for an additional $251 billion for the program.

https://nypost.com/2020/04/20/shake-shack-to-return-10-million-coronavirus-small-business-loan/

'It's going to backfire': Fauci says anti-quarantine protesters could prolong shutdown

Dr. Anthony Fauci, one of the leading experts in the White House's response to the coronavirus, warned demonstrations happening across the country protesting the quarantine orders will prolong the shutdown period. Residents in at least 20 states have taken to the streets to protest their governor's stay-at-home orders, arguing that the country should start to reopen and recover from the virus. More than 21 million people have lost their jobs in the last four weeks.

Fauci, the director of the National Institute of Allergy and Infectious Diseases, was asked about the dangers of these protests during an appearance on ABC's Good Morning America on Monday. “I think the message is that, clearly, this is something that is hurting from the standpoint of economics, from the standpoint of things that have nothing to do with the virus,” Fauci said. “But unless we get the virus under control, the real recovery, economically, is not gonna happen.” “If you jump the gun and go into a situation where you have a big spike, you’re gonna set yourself back,” he continued. “So as painful as it is to go by the careful guidelines of gradually phasing into a reopening, it’s going to backfire. That’s the problem.”

President Trump has espoused a very different tone when addressing the lockdown protests. Last Friday, he urged that people of Michigan, Minnesota, and Virginia "liberate" themselves and reopen their economies in social media posts. He was later asked about it during a White House press briefing, where he said that some of the governors had implemented restrictions that were "too tough" but stopped short of saying the government leaders should revoke the orders.

Democratic Michigan Gov. Gretchen Whitmer said she was considering extending social distancing guidelines in response to Michigan residents who protested her stay-at-home restrictions on Wednesday. Trump claimed that the protesters were being responsible in how they were demonstrating. “These are people expressing their views,” he explained. “I see where they are, and I see the way they’re working. They seem to be very responsible people to me, but they’ve been treated a little bit rough.”

https://www.washingtonexaminer.com/news/its-going-to-backfire-fauci-says-anti-quarantine-protesters-could-prolong-shutdown