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BPAA Federal Policy Update - May 26, 2021

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Latest on SBA Restaurant Revitalization Fund

 

  • Restaurant Revitalization Fund stopped accepting applications Monday The Restaurant Revitalization Fund (RRF) officially stopped accepting applications Monday, May 24, at 8 p.m. ET, the U.S. Small Business Administration (SBA) announced. The SBA revealed last week that the RRF had received applications seeking more than twice the $28.6 billion allocated by Congress to fund grants to restaurants, bars, and other eligible businesses hard-hit during the COVID-19 pandemic.
  • In a news release last Tuesday night, the SBA said that the RRF program has received more than 303,000 applications, requesting a total of nearly $70 billion, but that more than $220 million remained available from $500 million set aside for eating establishments that posted 2019 annual revenue of no more than $50,000.
  • Food and beverage providers that meet $50,000 revenue standard are encouraged to apply through SBA-recognized point-of-sale vendors or directly via the SBA online application portal, the agency said. Congress created the RRF to provide food and beverage providers with grants equal to their pandemic-related revenue loss, up to $10 million per business and no more than $5 million per physical location. The funds can be used for eligible expenses, such as payroll and rent. Read more here.

 

  • Hearings:
  • A Review of the SBA’s Grant Programs The Committee on Small Business Subcommittee on Oversight, Investigations, and Regulations will hold a remote hearing titled: “A Review of the SBA’s Grant Programs.” The hearing is scheduled to begin at 1:00 P.M. on Thursday, May 27, 2021 via the Zoom platform (information to be provided). See the hearing information here.
  • An Examination of the SBA’s Covid-19 Programs The Committee on Small Business will hold a remote hearing titled: “An Examination of the SBA’s Covid-19 Programs.” The hearing is scheduled to begin at 10:00 A.M. on Wednesday, May 26, 2021 via the Zoom platform (information to be provided). See the hearing information here.

 

  • Restaurants Appeal For More Aid by Politico: Restaurateurs spent most of last year successfully lobbying Congress to create a fund to aid restaurants battered by the pandemic. Now they’re mounting another lobbying campaign seeking more money, even as Congress turns its attention to President Joe Biden ’s infrastructure proposal and as Covid relief legislation recedes from the congressional agenda.
  • The Restaurant Revitalization Fund has received more than 300,000 applications for aid since it started accepting them earlier this month. The deadline to apply is May 24, the Small Business Administration, which administers the fund, announced on Thursday. Restaurant lobbyists say it’s already clear that the $28.6 billion in relief funds now available aren’t nearly enough. Erika Polmar, the Independent Restaurant Coalition’s executive director, said restaurants need as much as $160 billion.
  • While indoor dining restrictions are being rolled back and the weather in much of the country is increasingly hospitable to eating outdoors, many restaurants are deeply in debt and struggling with back rent that’s coming due, lobbyists said. “Two good months doesn’t make up for more than a year of being closed,” Polmar said. Restaurants are “turning their lights back on with a lot of debt, a lot of loss and a very uncertain future,” said Sean Kennedy, the National Restaurant Association's top lobbyist.
  • Restaurant lobbyists have already been pressing lawmakers to appropriate more money, but they’re preparing to make a renewed push once the fund stops accepting applications next week. Sens. Roger Wicker (R-Miss.) and Kyrsten Sinema (D-Ariz.) and Reps. Earl Blumenauer (D-Ore.) and Brian Fitzpatrick (R-Pa.), who worked on the original relief bill, are trying to determine how much more money is needed, according to Danielle Cohen, a Blumenauer spokesperson.

 

  • The SBA's Overly Popular Grant Program for Restaurants Is 86ed In less than two weeks, the Restaurant Revitalization Fund attracted more applications than an all-you-can eat dinner special. The Small Business Administration, the agency overseeing the $28.6 billion grant program for hard-hit foodservice businesses, reported on Wednesday that since RRF's May 3 launch, it received more than 266,000 applications, representing more than $65 billion in requested funds. Nearly half, or 147,000 applications, came directly from women, veterans, and socially and economically disadvantaged business owners, who requested $29 billion in relief funds. That will leave hundreds of thousands of other restaurant owners out of the money. 
  • For its first 21 days of operation, the RRF program was open only to businesses owned and controlled by women, veterans, and socially and economically disadvantaged individuals. To date, $2.7 billion of relief funds have been dished out to 21,000 restaurants. The SBA estimates that RRF awards take approximately 14 days to be reviewed and validated. Read more here.

 

  • SBA data confirms that the current Restaurant Revitalization Fund can’t meet demand According to the latest data from the Small Business Administration, they have already received 147,000 applications from priority groups (for the first 21 days, women, veterans, and people in socially and economically disadvantaged groups are being prioritized), requesting a total of $29 billion in funds. While initially President Biden estimated that about 100,000 businesses would be able to be helped in this first wave of funding, this group of 147,000 applicants has requested just over the initial $28.6 billion in the Restaurant Revitalization Fund. Overall, the SBA has received 266,000 applications representing over $65 billion in requested funds, more than twice the amount that is currently available. Read more here.

 

  • You’ve Applied: What To Do Next Below are helpful tips on what to do once your application has been submitted to SBA:
  • Retain all records submitted with the application, including a copy of the completed application.
  • Retain all records supporting the application that were not submitted, including:
  • Information supporting the date the business began making sales. SBA will be looking to establish the length of time the business has been open, so this documentation will be particularly important for any business opened in 2019 and later, due to RRF requirements.
  • How the grant amount was calculated, including relevant amounts subtracted from 2020 gross receipts.
  • Information demonstrating an assertion of priority for awarding the grant (certifying women-owned, veteran-owned, or owned by a socially and economically disadvantaged small business). The SBA can request documentation on your application or self-certifications, and plans to conduct random audits for some grant recipients. Retain all the records related to an eligible expense.
  • Information regarding the determination of “affiliates” or “affiliated businesses.”
  • Information supporting ownership shares for owners listed on the application as of the date of the application.
  • Plan how your grant funds will be spent on eligible expenses. The RRF grant is NOT an economic stimulus payment. Any payments made with grant funds that are not authorized by RRF rules may require the recipient to repay the funds or become subject to a federal fraud investigation.
  • Map out the covered period timeline: Feb. 15, 2020 to March 11, 2023, to ensure all planned eligible expenses fit within this time period.
  • Learn how RRF funds may be treated in upcoming tax filings. For example, a business that chooses to use RRF money for payroll in 2021 should not plan to also apply for employee retention tax credits (ERTC) in the same calendar quarter.
 

 

 
 
 

 

Unemployment & Labor

 

  • Ernst: It’s time for us to get Americans back to work and our country running again U.S. Senator Joni Ernst (R-Iowa), a senior member of the Senate Small Business Committee, today noted that—thanks to Operation Warp Speed—people are getting vaccinated, COVID-19 cases and hospitalizations are decreasing, and kids are going back to school. Ernst stated, however, that she continues to hear from employers having trouble getting folks back to work because of the enhanced federal unemployment dollars—and applauded Iowa Governor Kim Reynolds for curbing this program. Read the press release here.

 

  • White House Says Republicans Pulling Jobless Benefits Too Soon The White House pushed back against Republican governors curbing the extra jobless benefits for out-of-work Americans extended in President Joe Biden’s March pandemic-relief package. “There will come a day when we do not need these additional supports. There’s no question, these were designed to get us to the end of the pandemic. But we’re not there yet,” Cecilia Rouse, Chair of the Council of Economic Advisers, said at a Bloomberg conference Thursday. The April jobs report showed only 266,000 jobs were added to payrolls were added, compared to expectations for 1 million. Some economists and state governors blamed the $300 a week supplemental unemployment insurance payments for keeping workers at home. About 20 states have nixed the extra benefit, which the federal government offered until early September. Read More at Bloomberg

 

  • Senate Hearing Set for Biden OSHA Pick, Two Other DOL Nominees The Senate labor committee has scheduled a May 27 confirmation hearing for Doug Parker, the Biden administration’s nominee to lead the Occupational Safety and Health Administration, and two other Labor Department picks, according to an online notice Thursday. The Senate Health, Education, Labor, and Pensions Committee will also consider the nominations of Rajesh Nayak, for assistant secretary of labor for policy, and Taryn Mackenzie Williams, for assistant secretary of labor for disability employment policy. Read More at Bloomberg

 

  • Biden's hands likely tied on states' unemployment insurance cuts The governors of more than 20 states have elected to stop paying workers supplemental federal unemployment benefits — and there likely isn't much the Biden administration can do about it, one Labor Department official said Thursday. The agency isn't expected to issue a formal decision on the legality of intervening until later Thursday or early Friday, the official said. But so far, DOL staff has concluded that the administration has little practical or legal ability to continue providing expanded jobless benefits over the heads of governors. Nearly two dozen Republican governors in states including Arizona, Texas and Georgia have elected to stop providing federally supplemented unemployment insurance to jobless workers in their states in response to business complaints about a labor shortage, though experts are divided over whether and to what extent generous benefits are keeping workers on the sidelines. Read more at Politico.
 

 

 
 
 

 

Tax and Budget

 

  • Biden’s budget rollout pushed to May 28 President Joe Biden’s full budget request will be released on May 28, a day later than previously planned, the Office of Management and Budget said Wednesday That fiscal 2022 request is expected to expound upon the discretionary spending goals Biden outlined last month, as well as detail his requests for mandatory spending, a tax overhaul, infrastructure investment and job creation.

 

  • Biden’s Tax Math for $4 Trillion Runs Into Congress Scorekeepers The Biden administration’s $4 trillion economic agenda is at risk of getting tangled up in the calculations of Congress’s budget scorekeepers. Where the Treasury Department sees improved tax collection generating $700 billion in new revenue over a decade to help pay for programs, the Congressional Budget Office’s guidelines and own estimates may result in the legislative agency projecting nowhere near that. And while that gap may seem modest by the gargantuan numbers of Washington spending, it threatens a host of political difficulties, not least of which is making it harder for the White House to pass the plan without the support of Republicans. GOP lawmakers have said raising taxes and repealing parts of the 2017 tax overhaul are non-starters. Read More at Bloomberg

 

  • Democrats Weigh Weakening Biden Tax on Capital Gains for Estates The Biden administration’s proposal to dramatically expand the inheritance tax bill for wealthy Americans is running into some headwinds with Democrats on Capitol Hill, showcasing nervousness about the scope and size of elements of the White House’s ambitious tax plans. President Joe Biden’s sweeping expansion of social spending programs would be financed in part by tax hikes on the rich. A key element of that is ending “step-up in basis,” which allows heirs to use the market value of assets at the time of inheritance -- rather than the historical purchase price -- as the cost basis for capital gains. Instead of hitting heirs with a hefty tax payment at the time of the death of their benefactor, staff for House Ways and Means Chair Richard Neal have floated allowing the beneficiaries to defer the bill as long as they hang on to the asset, according to people familiar with the matter. Read More at Bloomberg
 

 

 
 
 

 

State and Local

 

  • Treasury Launches Coronavirus State and Local Fiscal Recovery Funds to Deliver $350 Billion – The Department of Treasury announced its about ready to deliver the $350 billion in emergency funding for state, local, territorial, and Tribal governments provided through the American Rescue Plan. They have released the Fact Sheet here.
  • Treasury also released details on the ways funds can be used to respond to acute pandemic-response needs, fill revenue shortfalls among state and local governments, and support the communities and populations hardest-hit by the COVID-19 crisis. Eligible state, territorial, metropolitan city, county, and Tribal governments will be able to access funding directly from the Treasury Department in the coming days. The law provides substantial flexibility for each jurisdiction to meet local needs. Within the categories of eligible uses listed, recipients have broad flexibility to decide how best to use this funding to meet the needs of their communities. Read more here on the funds and eligible uses.
 

 

 
 
 

 

Political Updates

 

  • Race For The House: The House passed a bill that would create a “commission to investigate the Jan. 6 attack on the Capitol” with 35 Republicans breaking from leadership and voting with the Democrats. The GOP members who sided with Democrats include a mix of representatives from safe Republican seats, like Rep. Tom Rice (SC-07) and members from competitive districts facing challenging reelection races like Rep. Maria Elvira Salazar (FL-27). Four of the nine Republicans who represent districts President Biden carried in 2020 did not vote for the commission. Read more at the Washington Post.

 

  • The NRCC said it raised $11.2 million in April and had $34 million cash on hand, “which party officials say is a 70% increase over the same point last cycle.” Read more at Fox News.

 

  • PA GOV: State Sen. Doug Mastriano (R) said “Trump asked him to run” for governor “and promised to campaign for him.” (AP) A senior Trump aide told The Philadelphia Inquirer that “Mastriano recently came up to see President Trump at Trump Tower and asked for the President’s support, but there has not been an endorsement.” Philadelphia Inquirer

 

  • KY SEN: 2020 candidate Charles Booker (D), who is “strongly considering” a bid against Sen. Rand Paul (R), announced Wednesday that he raised $500,000 “since forming an exploratory committee signaling his interest” in the race last month. Read more at AP

 

  • GA-10: Magazine publisher Marc McMain (R) announced a bid to replace Rep. Jody Hice (R), who is running for secretary of state. McMain is the owner of Town Values magazine and has likened his “outsider” business credentials to Trump's. Four other Republicans are also running in the safe red district so far. (Walton Tribune)

 

  • FL SEN: Though there was some speculation that Rep. Val Demings’ (D-10) expected entrance in the Senate race would deter Rep. Stephanie Murphy (D-07) from running, “sources familiar with Murphy’s decision-making say the Central Florida Democrat believes she has the same upsides as Demings—and more.” (Florida Politics)

 

  • 2024 CORNER: In an interview, Sen. Kirsten Gillibrand (D-NY) said that she wants to run for president again in the future. (Politico)
 
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