Do you have clients in the restaurant industry? How about caterers, bakeries? Or maybe you have winery, brewery or distiller clients? Bars or taverns? If so, an important question you need to answer is whether or not you have already helped your clients apply for the Restaurant Revitalization Fund (RRF) grants. And an even more important question to ask is if you have clients that are eligible for a grant from this program who have 2019 gross receipts of not more than $50,000.
Here is what is happening.
The RRF is facing the same fate as the PPP which ran out of money earlier this month well before the May 31st deadline.
RRF grant applications were first accepted on May 3, 2021 and more than 266,000 applications have been submitted, totaling $65 billion in requested grants. However, the RRF was only funded with $28.6 billion.
There are two factors that will impact who will receive funding.
In establishing the RRF, priority groups were defined as businesses with at least 51% ownership by individuals who are women, veterans or socially and economically disadvantaged. Although grant applications opened to all eligible businesses on May 3rd, the SBA limited processing of applications to priority groups for the first 21 days.
With more than 147,000 applications received from the priority groups totaling $29 billion, it appears that not even all priority group applications will be funded.
As of this writing, the SBA is still accepting applications for the RRF. Why? The answer is set-asides. In establishing the RRF, money was set aside for businesses meeting certain criteria.
- $5 billion is set aside for applicants with 2019 gross receipts of not more than $500,000
- An additional $4 billion is set-aside for applicants with 2019 gross receipts from $500,001 to $1,500,000
- An additional $500 million is set-aside for applicants with 2019 gross receipts of not more than $50,000
Funds set aside for businesses meeting the first two types of criteria have been exhausted. However, there is still potential funding available for businesses with 2019 gross receipts of not more than $50,000.