The program could quickly run out of money.
The program will provide grants of up to $10 million to restaurants, bars, food trucks and other eateries.
“The question on the minds of many is what happens when applications outpace the available funds,” the president and CEO of the National Restaurant Association, Tom Bené, said this week.
Earlier Wednesday — Cinco de Mayo — Biden made an unannounced visit to a taqueria in Washington that had been awarded money from a pilot version of the restaurant fund, as well as from the Payment Protection Program — the federal government’s signature program for providing businesses with pandemic-related aid over the past year. He said he ordered tacos and enchiladas.
Severely impacted by the economic crisis unleashed by the pandemic and restrictions on businesses to mitigate the spread of the virus, restaurants have over the past year become primary beneficiaries of government grants and loans to businesses.
Accommodation and food services businesses were the No. 1 industry benefiting from the latest round of funding from the Payment Protection Program — receiving 17%, or $40 billion, of the loans, according to the U.S. Small Business Administration. They have received billions more from separate federal aid programs for small businesses.
The Small Business Administration, which administers the Payment Protection Program and the new restaurant fund, said Tuesday that the Payment Protection Program had finally run out of money — four weeks earlier than expected — as the government transitions to more targeted programs.
The same could happen with the restaurant fund, according to the National Restaurant Association’s chief lobbyist, Sean Kennedy.
Kennedy told grassroots supporters in an email that the “the total number of applicants is going to exceed expectations – and may quickly exhaust the $28.6 billion in federal funding.”
The White House on Wednesday touted the 97,600 applications it said came from businesses controlled by women, veterans, socially and economically disadvantaged individuals, as well as 61,700 more from businesses making less than $500,000 annually before the pandemic — “representing some of the smallest restaurants and bars in America.”
Those applicants will be prioritized for the first three weeks of the program.
The businesses can use the grants for expenses like payroll and rent.
The average turnaround time “from submission to funding” will be up to two weeks, White House press secretary Jen Psaki said Wednesday.
Psaki said Biden was “open” to working with Congress to provide even more funding for restaurants in the future.
“There has already been a large interest in this program,” Psaki said. “And there are great needs across the country from these small businesses, from these restaurants that are in communities across the country.”