WASHINGTON–As the Paycheck Protection Program (PPP) winds down, the federal government is preparing to open two new industry-specific small-business relief programs.
The Small Business Administration said it hopes to start taking applications by the end of this week for a $16 billion grant fund for live-event businesses like theaters and music clubs. The program, the Shuttered Venue Operators Grant, was supposed to begin nearly two weeks ago, but its application system malfunctioned and collapsed, stymieing thousands of desperate businesses that have been waiting months for the promised aid, noted the New York Times.
The agency has also recently posted additional details on its forthcoming Restaurant Revitalization Fund, a $28.6 billion support program for bars, restaurants and food trucks whose sales were devastated by the shutdowns that states imposed in response to the pandemic. The fund was created as part of last month’s $1.9 trillion economic support package.
Within the next two weeks, it will begin a seven-day test intended to help the agency avoid the kind of technical fiasco that plagued the venue program, the Times stated, noting the agency has not announced a specific start date for either grant program.
Grants Of Up to $10 Million
Both programs offer recipients grants of up to $10 million to replace a portion of their lost sales. But both programs — which will distribute money on a first-come-first-served basis, subject to some priority rules — are expected to run out of money quickly. The money in the restaurant fund, in particular, falls far short of its needs, agency officials acknowledged to the Times.
“Everyone should apply on Day 1,” Patrick Kelley, the head of the agency’s Office of Capital Access, told attendees at a webinar last week organized by the Independent Restaurant Coalition, the Times reported. Lawmakers projected at least $120 billion in demand for the restaurant fund, Kelley said, but provided money for less than a quarter of that amount.
The law creating the restaurant fund required a 21-day exclusive period for businesses that are majority-owned by women, veterans or socially disadvantaged individuals. The SBA said that group includes those who are Black and Hispanic, as well as Native Americans, Asian-Pacific Americans and South Asian Americans.
Funds to be Exhausted
That period alone will almost certainly exhaust the restaurant fund. Applicants will be asked to self-certify their eligibility for the priority period, the Small Business Administration said, the Times added.
The report further noted participants in the fund’s seven-day pilot period will be picked randomly from current Paycheck Protection Program borrowers who meet the priority period criteria, the agency said. They will help test the system but will not receive grant money until the application system opens publicly.