SBA Announces New Application Details and Guidelines for $ 28.6 Billion Restaurant Revitalization Fund | Lowndes


On Saturday, April 17, 2021, the Small Business Administration (SBA) provided an update on the Restaurant Revitalization Fund (RRF) grant application. While there is no official launch date for the app, the SBA has said that prior to the application and over the next two weeks, the SBA will be implementing a seven-day pilot program for the RRF application portal in order to solve any technical problem before the public. launch.

We are closely monitoring the SBA website and social media sources for information on the app launch date. Below is a detailed summary of recently published information regarding the RRF grant application.

As stated in our previous articleThe American Rescue Plan Act established the RRF grant to provide funding to help restaurants and other establishments in the hospitality industry stay afloat during the pandemic. This grant program will provide funding equal to the affected entity’s pandemic-related loss of revenue up to $ 10 million per business group ($ 5 million cap per business location). Grant recipients are not required to repay funds if they are used for eligible expenses (see below) and the fund is exhausted by March 11, 2023.

Applicants will apply through the SBA Online Application Portal or SBA Recognized Restaurant Partners with SBA Form 3172 (see a sample). Registration with, DUNS or CAGE is no longer required.

In addition to the SBA 3172 form request, here are the following documents required for the grant application:

A. IRS Form 4506-T; and

B. Documentation of gross receipts – any the following documents indicating the gross revenue and, where applicable, the eligible expenditure:

  • Business income tax returns (IRS form 1120 or 1120-S)
  • IRS Form 1040 Schedule C; IRS Form 1040 Schedule F
  • Bank statements from January 1, 2019 to
  • Financial statements prepared externally or internally, such as income statements or income statements
  • Point of sale reports, including IRS Form 1099-K (i.e. transactions involving a payment settlement entity)
  • * For partnerships – IRS Form 1065, including K-1
  • * Brewery / Bakery / Tasting room / Taproom / Brewery / Cellar / Distillery:
  • Documentation that on-site sales to the public represent at least 33.00% of gross revenue for 2019, which may include Tax and Trade Bureau (TTB) 5130.9 or TTB forms. For companies that opened in 2020, the applicant’s original business model should have considered at least 33.00% of gross revenue in on-site sales to the public.
  • * Hostels:
  • Documents proving that on-site food and beverage sales to the public represent at least 33.00% of gross revenue for 2019. For companies that opened in 2020, the applicant’s original business model should have considered at least 33, 00% of gross revenue from on-site sales to the Public.

The SBA has not announced when the app will be open to the public. Once the portal is available, all eligible entities can apply, regardless of company size or ownership status. The SBA is approaching a 14-day processing time for requests. It should be noted, however, that during the first 21 days of the application cycle, the SBA will only fund and prioritize “priority groups”.

Priority groups are small businesses owned by at least 51% of women, ex-combatants or socially / economically disadvantaged individuals. Socially disadvantaged people are defined as “those who have been subjected to racial or ethnic or cultural prejudice because of their identity as a member of a group without regard to their individual qualities”. Economically disadvantaged people are defined as “socially disadvantaged people whose ability to compete in the free enterprise system has been weakened due to diminished capital and credit opportunities relative to other people in the same industry. ‘activities which are not socially disadvantaged’. Applicants must self-certify on the application that they meet one of the “priority group” eligibility requirements.

The grant will be calculated as follows:

1. Calculation 1: for candidates in activity before or on January 1, 2019:

  • 2019 gross revenue minus 2020 gross revenue minus PPP loan amounts

2. Calculation 2: for candidates who started their activities partially until 2019:

  • (2019 Average Monthly Gross Revenue x 12) minus 2020 gross revenue minus PPP loan amounts

3. Calculation 3: for applicants who started their activities between January 1, 2020 and March 10, 2021 and applicants who have not yet opened but have incurred eligible expenses:

  • Amount spent on eligible expenses between February 15, 2020 and March 11, 2021 minus 2020 gross receipts minus PPP loan amounts

For entities that started their activities partially until 2019, you can choose (at your own discretion) to use calculation 2 or calculation 3.

The SBA can provide funding of up to $ 5 million per location, not to exceed $ 10 million in total for the applicant and affiliated companies. The minimum reward is $ 1,000.

For this program, the SBA has stated that “gross receipts” will not include Paycheck Protection Program (PPP) loans received from the first or second draw, amounts received from economic disaster loans ( EIDL), advances on EIDL, state or local. grants under the CARES Act or otherwise, or any SBA Section 1112 payment.

Once received, institutions must use grant funds for the following expenses to avoid reimbursement:

  • Company salary costs (including sick leave)
  • Payments on any commercial mortgage bond (principal and interest payments allowed)
  • Professional rent payments (excluding rental prepayments)
  • Any commercial debt service (pre-payment excluded, but principal and interest payments are allowed)
  • Commercial utility payments
  • Business maintenance costs
  • Outdoor seating construction
  • Professional supplies (including protective equipment and cleaning materials)
  • Company food and beverage costs
  • Supplier costs covered
  • Business operating expenses

As long as the grant funds are used for the above-mentioned categories no later than March 11, 2023, the grant recipient will not be required to repay the grant amounts.

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