Forty-two percent of restaurants that didn’t receive Restaurant Revitalization Fund grants are in danger of filing for bankruptcy, according to a survey released by the Independent Restaurant Coalition.
Additionally, 28 percent of those same businesses have received or are anticipating getting an eviction notice compared to 10 percent among those that received Restaurant Revitalization Fund grants.
The survey pulled responses in January from almost 1,200 operators of independent restaurants and bars across all 50 states. About 22 percent of respondents came from the Northeast, 18 percent from the Midwest, 27 percent from the South, and 33 percent from the West.
“These businesses are filing for bankruptcy and receiving eviction notices after crying out for help for nearly two years,” “Erik Polmar, executive director of the Independent Restaurant Coalition, said in a statement. This isn’t surprising – the IRC hears these stories everyday.”
“Congress and the Biden Administration need to treat this like the crisis that it is and replenish the RRF,” he continued. “The nearly 200,000 restaurants and bars left behind in the first round of funding do not have much time left.”
The $28.6 billion Restaurant Revitalization Fund received north of 370,000 applications asking for $76 billion last year, but more than 177,000 restaurants and bars came away empty-handed.
Forty-one percent of respondents who didn’t receive Restaurant Revitalization Fund grants have taken out new personal loans to support their business, more than 25 percent have been forced to sell a personal asset, 30 percent have decreased staff, and 49 percent have been forced to lay off workers.
But for those that did receive funds, only 19 percent have taken out new personal loans, 10 percent have sold a personal asset, 21 percent have lowered staffing, and 33 percent have laid off employees.
The grave situation comes as the Omicron variant continues to ravage the country and impact restaurant sales. According to the survey, 46 percent of respondents said their operating hours were affected by more than 10 days in December, and 58 percent said their sales decreased by more than half during the same month.
Almost two-thirds said they need to purchase COVID tests, but nearly 65 percent have trouble finding them and 38 percent reported price increases in the tests.
In the face of the pandemic and ongoing labor shortage, 84 percent reported raising wages, 37 percent added paid sick leave and benefits, and 31 percent added paid vacation.
“This data makes clear what we’ve been saying all along: independent restaurant and bar owners left out of the Restaurant Revitalization Fund are taking on massive debts, laying off employees, and selling personal assets to stay in operation,” Polmar said. “The Omicron surge has pushed many restaurants to the brink, especially those still waiting for Restaurant Revitalization Fund grants.