District restaurants are calling on Congress to save their small businesses by refilling the Restaurant Revitalization Fund (RFF) as part of the spending measure set for a vote Thursday.
On Wednesday, the Independent Restaurant Coalition held an event to call on Members of Congress to save their dying small businesses.
The event was held Sept. 29 at Tortilla Coast (400 First St. SE), a restaurant that is on the edges of the Capitol Grounds where Members of Congress prepared for a Thursday vote on a $1.3 trillion infrastructure package.
That bill currently does not include relief for neighborhood restaurants and bars. The coalition says if it isn’t included, many small eateries will go out of business.
Created by Congress in April 2021, the Restaurant Revitalization Fund (RFF) provided $28 billion in financial relief for eligible restaurants and related food and beverage service businesses, to be administered by the SBA. It quickly ran out of money, leaving 177,000 restaurants and bars unfunded.
Support for providing these restaurants and bars the relief they need is continuing to grow. 221 members of the House of Representatives have come out in support of the bill, including Rep. Alexandria Ocasio-Cortez (D-NY-14), as well as 40 members of the Senate. Reps. Earl Blumenauer (D-OR-3) and Brian Fitzpatrick (R-PA-1) and Sens. Roger Wicker (R-MS) and Kyrsten Sinema (D-AZ) introduced the legislation in both chambers of Congress, which provides $60 billion in additional funding for the RRF.
“The best news is that Speaker [Nancy] Pelosi just on Friday made that promise to me,” said Representative David Phillips (MN-D) at the event. Phillips co-sponsored the bill.
“‘We will get this done’,” Phillips recounted Pelosi as saying. “‘I don’t have the time, I don’t have the date, but I assure you that we have the commitment, we have the intention and we will get this over the finish line’.”
As with the infrastructure package, getting the Restaurant Revitalization Fund Replenishment Act to pass is an uphill battle. But restaurants say that effort is necessary to save their small businesses. After all, they argue, neighborhood bars and restaurants are critical to the infrastructure of their communities.
Blow After Blow
At one point, tex-mex restaurant Tortilla Coast (400 First St. SE) was so frequented by Capitol Hill patrons that a table at the restaurant became associated with discussions around the 2013 Iran Nuclear Agreement.
But facing what he characterized as a nearly 90 percent reduction in business due to the pandemic, Tortilla Coast owner and Chef Geoff Tracy faced closure of the restaurant in July 2020. He was saved, he said, by the first payment of PPP.
Then came Jan. 6, 2021. The restaurant was evacuated due to bomb threats at both party headquarters and then, the next day, found themselves cut off from their largest customer base by a 7-foot fence.
Chef Geoff Tracy was one of the lucky ones. A second round of PPP kept the lights on, and his landlord worked with him. But the RRF money is what’s keeping him afloat, Tracy said. He’s used the money to get 80 percent of his staff back to work. “It’s still a money loser right now,” he said. “But the fact that we are the receipient of RRF allows us to lose money and keep people employed.”
Restaurants are still not out of the woods, Tracy said. Business is still down about 75 percent from pre-pandemic. In August, Tortilla Coast was evacuated again when a man in a pick-up parked with what he said was a bomb outside the Library of Congress.
“It’s been blow after blow,” Tracy said. “It’s a very weird place to do business these days. It used to be an awesome place to do business.”
Convoluted Process
Tracy said he still isn’t sure exactly why they qualified over anyone else. “It’s one of the most convoluted things about the whole [program],” Tracy said of the selection process.The process of determining who got RFF money was frought with its own challenges.
During the first 21 days of the program, priority was given to eligible small businesses owned and controlled by women, veterans, and certain racial and cultural groups with limited financial resources. In May 2021, the owner of Jake’s Bar and Grill in Tennesee filed a lawsuit alleging that the priority portion of the program discriminated against him as a white man, effectively stopping SBA from making the payments to the very groups the program wanted to help first, and pushed everyone else to the front of the line.
Who Gets Funded?
Jill Tyler, Co-Owner of Tail Up Goat and Reveler’s Hour, said both of her businesses would have closed without PPP. She said while PPP was the life line, RFF was recovery; and after 18 months of holding on, recovery is critical.
But only one of her restaurants, Tail Up Goat, received RFF. Revler’s Hour, which opened Dec. 31, 2019, did not.
“I had to look at my other team about four weeks ago and tell them: it might be over. We were out of money,” Tyler said.
Reveler’s Hour was lucky. Investers stepped in to save the retaurant, but it added to the already considerable opening debt, which now includes rent deferrment, loans and credit cards. “There are winners and losers when it comes to RRF,” Tyler said. “We shouldn’t have one business get it and one business not,” she said.
Some businesses were told they would receive RRF funds, but they never materialized. Pizzeria Paradiso (2003 P St. NW) Chef and Owner Ruth Gresser said that she was told she qualified for an RRF disbursement, but she never got the money or any information about why. “We were promised money, we were approved and we were never funded,” she said.
She waited for the deposit. It was a month-and-a-half before Gresser found out that there wasn’t going to be any money. By then, the RFF fund was long depleted.
“That was particularly devestating: to be waiting for the money to hit the bank,” Gresser said, “and it never [did].”
What it Means if You Didn’t
Daisuke Utagawa said the funding is critical to restaurateurs and employess but also to culture.
“Obviously I need it, my partners need it –we all need it,” Utagawa said.
Utagawa is a partner in the Daikaya Group, which has three restaurants in the District,nincluding ramen bar Hatoba (300 Tingey St. SE), which opened in October 2019. Daikaya did not receive funding through RRF. He said that the loss of a restaurant is cultural loss.
Originally from Japan, Utagawa said the American restaurant industry has become an inspiration for other countries. “All that might be gone. I can’t put a number on what we’re going to lose culturally, but it’s got to count for something for America.”
Minnesota Representative Phillips agreed that restaurants are key to culture and to community. On Monday night, he and his daughter ate at Daikaya’s Bantam King (700 Fifth St. NW), when he had a chance to talk to Utagawa.
“I can tell you what he just didn’t. He told us he’s had a lot of sleepless nights lately. Multiply that times 170,000 just in this industry alone,” Phillips said. “Any one of us who has worked in a restaurant knows that it’s a community, and you’re taking care of your family when you get your paycheck.”
Threat of Furlough
But, as Chef Geoff noted, lately that goal has been continually impeded. Hill restaurants that have struggled through the pandemic and increased security after Jan. 6 now face an additional hurdle that could have twice the impact. If Congress fails to approve a spending measure by Thursday, federal workers would stop working –many only newly returned or returning to their offices. That will cut an already depleted customer base.
If additional RRF funding isn’t included in that bill, many Hill restaurants may not survive a federal furlough.
“It’s just another in a series of blows,” he said. “The closure of Capitol Hill would be just another bummer.”
Rep. Earl Blumenauer (D-OR) was the Original Sponsor of the Restaurant Revitalization Fund Replenishment Act. He pointed out that in discussion of the infrastructure bill, people are throwing numbers in the trillions. Saving neighborhood restaurants, critical to infrastructure, would only take 50 to 60 billion, he said.
“The neighborhood retaurant is the quintessential building block of a livable community,” he said. “For many people it’s their first job, it’s an opportunity for business to be established, particularly for women and minorities, and it’s an opportunity for people to come together.”
It only remains to be seen if Congress can come together at all. If they don’t agree on something Thursday, or if they can’t find the $50 to $60 billion to help out the restaurant industry, advocates say next time, there might no longer be a table for them to come to.
