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The $1.9 Trillion American Rescue Plan – What’s in it for Small Businesses? Program Specifically for Restaurants


On Thursday, President Joe Biden signed the COVID stimulus bill – also known as the American Rescue Plan – into law. While much focus is on the $1,400 direct payments, there are some specific spending measures tailored for small business.

The $1.9 Trillion American Rescue Plan includes three programs specifically for small businesses. Those 3 programs total $55 Billion.

The three programs are:

  1. A new $25 Billion program specifically for restaurants
  2. $15 billion to re-fund the Economic Injury Disaster Loan Program.
  3. $15 billion to state and local governments, earmarked for small businesses.

Additionally, the provision that would have raised the national minimum wage to $15 has been dropped from the bill.

There are additional monies which may have a trickle-down effect that aids small businesses. Those additional monies are part of a $350 billion package of financial relief for states, cities and schools.



American Rescue Plan – What’s in it for Small Business?

Let’s look at the specifics of the American Rescue Plan that impact small businesses. Programs will be administered through the Small Business Administration.

$25 Billion for Restaurant Program

This program will award grants up to $10 million per entity. If a restaurant is a chain, the program can grant $5 million per physical location. The grants can apply to no more than 20 locations for the same entity.

There’s a basic formula that will be used in grant applications. Subtract the 2020 revenue from the 2019 revenue.

Priority for these grants will be given to restaurants owned by women, veterans and socially/economically disadvantaged owners.

$15 Billion for Economic Injury Disaster Loan Advance program

This is the same as the program which began in March 2020. The monies refund the program, but there are new stipulations to the grant awards.

In the original program, the applicant business would have fewer than 300 employees and a 35% reduction in revenue. Those requirements continue, and businesses that fit those requirements may still apply.

In the new program, the SBA is directed to direct its focus to awarding grants to businesses with 10 or fewer employees, a 50% revenue loss, and/or location in a low-income area (according to census statistics).

$15 Billion for State and Local Governments

These monies are earmarked for small businesses. The language in the American Rescue Plan allows state and local governments to use the funds to award low-interest loans to existing small businesses and to small business start-ups.

Can you get a piece of the money? Research the possibilities via your state and local government.

The Shuttered Venue vs. PPP Dilemma

The PPP reopened on January 19 and ends March 31. The Shuttered Venue grant applications haven’t opened … yet.

Here’s the dilemma – A business can’t apply for both grants at the same time, according to the guidelines of the Shuttered Venue Operators grants.

What should you do? We don’t have an answer for that one. Your best option is to monitor the SBA website.

Trickle Down Programs in the American Rescue Plan

Although these monies are specifically earmarked for small businesses, they could help with their operations.

Here’s a quick review of monies that will benefit small business owners and their employees, who are hoping for help with child care and health insurance.

  1. $25 Billion to assist child-care providers in financial distress. This program could remove a key barrier that prevents employees from returning to a physical workplace – finding child care.
  2. $5.5 Billion for Education programs – These monies break down into $1.25 billion for summer enrichment programs, $1.25 billion for after-school programs, and $3 billion for education technology (to enhance online learning). Again, these monies may help employees and employers with child care challenges.
  3. Paid Leave – The existing Covid relief program provided funding for emergency paid leave for workers who didn’t have that benefit with their job. The $1.9 Trillion American Rescue Plan will extend that benefit through the end of September.
  4. Extended COBRA coverage – COBRA coverage would be extended through the end of September for those who have lost jobs.

Image: Depositphotos






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