Since the pandemic hit, there’s been copious amounts of legislation passed in order to provide relief for business operators. With each piece of passed legislation, changes have piled on top of one another, muddling what operators need to know. An overwhelming sense of paralysis by analysis has become apparent and restaurant operators don’t even know where to begin.
During this week’s episode of The Tip Share, RASI Compliance Director, Brian Smith, breaks down available pandemic relief into bite-sized bits so operators can easily understand what’s available to them! Read on to learn more about The PPP, EPSL, ERTC, RRF, and the SVOG!
List of Grants Made Available in 2020 & 2021:
- 1st Draw/2nd Draw PPP (Paycheck Protection Program)
- EPSL (Emergency Paid Sick Leave)
- ERTC (Employee Retention Tax Credit)
- RRF (Restaurant Revitalization Fund)
- SVOG (Shuttered Venue Operators Grant)
Updates on The Paycheck Protection Program:
Loans of $150,000 or less account for 93% of outstanding PPP loans, according to the SBA.
The SBA launched a new application portal. This allows borrowers to apply for forgiveness directly with the agency instead of having to go through their lender.
Many smaller PPP lenders lack the technology and staff to develop efficient web-based loan forgiveness platforms to process applications. This will help smaller banks. Larger banks with their own forgiveness platform will more than likely not opt-in.
Emergency Paid Sick Leave Availability:
EPSL credits are still available to employers that choose to pay qualified paid sick leave wages. However, paying sick leave wages is not required. The American Rescue Plan Act of 2021 extended Emergency Paid Sick Leave through September 30, 2021.
Reasons for eligible leave now include the following:
- Obtaining or recovering from COVID-19 immunization
- Accompanying an “individual” to obtain immunization related to COVID-19
An “individual” is regarded as the following: An immediate family member, someone who regularly lives in the employee’s home, or a similar person with whom the employee has a relationship that creates an expectation that the employee would care for the person.
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A Brief History of The ERTC:
The ERTC was created by the CARES Act (Coronavirus Aid, Relief, and Economic Security Act) in 2021, initially, PPP recipients were not allowed to claim the ERTC, but that was changed by The Consolidated Appropriations Act of 2021.
The Consolidated Appropriations Act, of 2021 also extended the ERTC through June of 2021 and then again by The American Rescue Plan Act through the end of 2021, However, the Infrastructure Investment and Jobs Act could repeal that extension as a means to pay for a portion of the bill.
This change may not apply to any recovery start-up businesses.
In Quarter 3 and 4 of 2021 only, a recovery startup business is an employer that:
- Is not otherwise eligible because of gov’t partial shutdown or gross receipts reduction that
- Began carrying on a trade or business after Feb. 15, 2020
- With average annualized gross receipts of $1 million or less
Main differences between the 2020 and 2021 ERTC calculations:
All wages paid to be eligible for the ERTC business with 100 full-time employees or less in 2020 qualify; that number increased to 500 full-time employees in 2021.
- $10,000 wages/per employee for all of 2020/$10,000 wages per employee/per quarter in 2021
- Credit is 50% of eligible wages in 2020/credit is 70% of eligible wages in 2021
What operators should know about the Restaurant Revitalization Fund who received a grant:
The RRF covered period begins on February 15, 2020, and ends on March 11, 2023.
Not later than December 31, 2021, all recipients must report to the SBA how much of their RRF grant has been used against each eligible use category. If the recipient fully expends their funds prior to December 31, 2021, they will be asked to certify that proceeds have been used on eligible expenses. All Applicants that do not fully expend RRF grant funds prior to December 31, 2021, will be required to complete annual reporting submissions until they fully expend the grant funding, or the covered period expires.
Highlights of the Shuttered Venue Operators Grant Program:
The Shuttered Venue Operators Grants got off to a rocky start but got the kinks worked out slowly—the SVOG’s portal was opened late and shut down immediately for nearly 3 weeks of repairs and more testing before finally opening on April 26th of 2021.
The SBA stopped accepting applications for SVOG on August 20th, 2021.
The SVOG program awarded a little over $9 billion in grants to more than 11,300 businesses since it opened in late April.
The SBA has received more than 17,600 applications for the SVOG program, well over 14,000 were received in the first 60 days. Those applications represent $13.3 billion in requested funding, nearly $3 billion less than the total amount allotted to the program.
Only $9 billion of the $16.25 billion allotted to the SVOG have been awarded. This is why the SBA is planning to open the program for supplemental SVOGs for 50% of the original award amount, capped at a total of $10 million (initial and supplemental combined).
Additionally, to ensure no eligible venue is left behind, the SBA is currently accepting, by invitation, applications for reconsideration of award amounts and appeals. There were over 3,200 applications declined according to the SBA.
All SVOG information retained from Shuttered Venue Operators Grant Public Report as of August 23, 2021, published by the SBA and available at SBA.gov website under Funding Programs, or just search for SVOG.
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