Who put the Poison Pill in the PPP?

'The Big Guys Get Bailed Out': Restaurants Vie for Relief Funds

Buried deep in the 900-page stimulus package that Congress passed in March, a single paragraph has sparked an outcry from small restaurants as major chains and mom-and-pop places alike scramble to survive a devastating financial crisis.

The provision, in a section outlining which small businesses qualify for loans from the federal government, allowed big chains like Shake Shack, Potbelly and Ruth’s Chris Steak House to get tens of millions of dollars while many smaller restaurants walked away with nothing when the $349 billion fund was exhausted last week. On Monday, Congress and the White House were nearing a deal to replenish that fund with $300 billion in additional relief.

But a subsection of the legislation, under the heading “business concerns with more than 1 physical location,” states that certain types of businesses, including restaurant and hotel chains, with no more than 500 employees “per physical location” are also eligible.

Restaurant and hotel trade associations lobbied for that provision. On March 18, the National Restaurant Association sent a letter to Congress requesting a recovery fund specifically for its industry. But as drafts of the legislation started circulating, it became clear that Congress was not going to grant a restaurant-specific bailout.

So the group called members of Congress to advocate for a carve-out in the small-business program that would make all restaurants eligible for loans, regardless of size.

There was no one in the industry that was calling against this at that point — everybody was in support of this carve-out,” said Sean Kennedy, executive vice president for public affairs at the National Restaurant Association. “This pandemic is a tidal wave that is crashing against every restaurant, no matter how big, small or well funded it may be.”

Meanwhile, at lunches last month, Senate Republicans were asking one of the architects of the federal loan program, Sen. Marco Rubio of Florida, who heads the small-business committee, why the funding did not extend to larger companies. He responded that it was meant for small businesses, and that he was negotiating its parameters with the Democrats.

During those negotiations, Rubio and several colleagues from both parties, including Sen. Chuck Schumer of New York, the Democratic leader, agreed to expand the program to cover some hospitality establishments so more employers would have access to the loans.

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https://www.yahoo.com/news/big-guys-bailed-restaurants-vie-121754387.html