Letter to the Hon. Nancy Pelosi, Speaker of the House, and Kevin McCarthy, House Minority Leader - Meeks Leads Letter Calling for More Financial Relief for Local Restaurants Affected by COVID-19

Letter

Dear Speaker Pelosi and Minority Leader McCarthy,

Restaurants have been absolutely devastated across the country due to the coronavirus pandemic
and ensuing lockdowns and shelter-in-place orders. While we are strong supporters of the
Paycheck Protection Program (PPP) and the Economic Injury Disaster Loan (EIDL) Advance
Program, we believe more must be done to help local restaurants around the country.
Unsurprisingly, the booking site Open Table finds restaurant reservations are down a full 100%
across around the United States. According to survey data, over 38% of restaurants have
completely closed, while 77% have seen at least a 50% reduction in sales. The National
Restaurant Association projects losses in March and April will approach $100 billion
nationwide. Per a Harvard Business School survey, only 15% of restaurants state they could
survive a six-month closure.

Congress has already taken important steps. The direct stimulus payments, expanded
unemployment insurance, and small business loan and grant payments are essential life bridges
for keeping workers and businesses in the industry afloat.

Recent data shows that "Accommodation and Food Services" received only 8.9% of the first
batch PPP funds. Crucially, this category also includes Chains like Shake Shack, Ruth's Chris,
and other chains that received maximum sized loans indicating local restaurants received only a
tiny portion of the PPP pie. Though we undoubtedly understand that all sectors of the economy
have been hit by this economic crisis, local restaurants have borne a disproportionate amount of
the suffering, yet are not receiving their fare share of PPP funds.

Going forward, we believe more must be done to protect these important economic (and cultural)
institutions. We propose the following steps:
1. Extending the duration of the loans under the PPP for businesses in the "Accommodation and
Food Services" Sector. Given the unlikeliness of a complete return to normalcy because of social
distancing measures, extending the loan repayment time period will be essential to keeping local
restaurants afloat.
2. Allow a larger percentage of the money to be used for rent or other expenses. Many of the
places hit hardest by the coronavirus also have the highest average rents. Restaurants in
expensive cities will struggle to survive if they cannot allocate a higher portion of PPP funds to
their rents or mortgages.
3. Create a special mechanism whereby local restaurants without formal business banking
relationships or those who are in the informal sector of the economy can also access these loans.
Any aid should be conditioned on full back tax payments if they are owed.
4. An above-the-line tax deduction for restaurant gift cards. This will encourage consumers
around the nation to provide liquidity to restaurants.

Thank you for considering the inclusion of these crucial items in the next CARES package.