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Shuttered Venue Operators Grant and Restaurant Revitalization Grant Updates

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Shuttered Venue Operators Grant and Restaurant Revitalization Grant Updates

Collin Gabriel May 19, 2021


Amber Faist (00:00):

Welcome Noah Brockman from, uh, the Oregon SBDC. Um, thank you so much for your time today. We’re going to be talking about the shuttered venue as well as restaurant revitalization, um, grants that are going to be kind of, or are already in process. Sounds like, um, if you could go ahead and give us a quick update and then, um, we’ll talk a little bit about some of the, the ins and outs.

Noah Brockman (00:26):

Yeah, so the Shuttered Venue Operator Grants program is open and they’re still accepting applications. Um, and again, this is a $15 billion, uh, America’s Rescue Plan Act program, um, um, appropriated by Congress. There’s so far they’ve received 12,000 applications. I think that’s as of, well, maybe today, May 13th. Um, the, uh, platform as people may have heard initially was fairly overwhelmed and they had to shut down initially they revamped it and, uh, reopened the following week. And, um, so I think it’s been relatively smooth from what I understand. Um, you know, I’ve, I’ve spoken with a few businesses who have gone through the process and they, um, you know, they’ve, they had some initial questions early on, and then once they got their applications in, um, right now they’re just waiting for SBA to review their application and update the status of the platform in their account and their SBA.

Noah Brockman (01:45):

Isn’t going to be, um, providing a lot of email contact or communication. You know, now we’re doing this, um, they just don’t have the capacity for that. So, um, as SBA reviews and, and, um, reviews applications to get to the next stage, uh, there’ll be, I guess, making that indication within the application platform for each applicant. So, so folks need to go log into their account and check it kind of on a regular basis to see what the status change will be. Um, today we got an update from the SBA S V O G program team, and, um, so they will be, um, releasing a new, uh, frequently asked questions guide for post application. So that’s something, um, we’ll be looking to check out and of course, download and save for all the questions we’ll have, um, as well as a larger FAQ coming out on, you know, if you’ve been decided as an, if, if for those folks who have been awarded, um, grants, they’ll have a whole tranche of new FAQ’s that will relate to their status and situation, um, you know, folks have already gone in and made their application.

Noah Brockman (03:16):

They, they really can’t go in and change things right now. It’s, it’s fairly locked up. So, um, that’s just kind of a, that just is what it is, I guess. Um, so, you know, we’ve heard from some folks who, uh, were kind of curious about, am I more of an SVO G grant material business, or am I a restaurant, right. Revitalization grant kind of business. And so we’ve had to navigate those conversations with people and, you know, sometimes where that, where you see that come up is like a banquet hall, you know, a place where there’s some kind of, um, entertainment and they also do, you know, food and beverages and dining and stuff. And so it really comes down to looking at each case separately and making a determination about, you know, what exactly is the, the, you know, the principal business activity here?

Noah Brockman (04:17):

Is it to be a live venue or is it to be, uh, like, um, a restaurant club with entertainment, selling food and beverages. So, you know, and for the ladder there, we end up referring people to check out the restaurant revitalization grant. Um, one more thing I’ll say about the SPOG is small. A couple of things there’ll be doing some press releases pretty soon, um, with stats, more stats and updates on the status of that program. And they will be offering a big webinar, very thorough webinar for, um, applicants that are approved for them to kind of get the next, um, traunch of information that they’ll need to go further through that process. So that’s what we have to look forward to.

Amber Faist (05:08):

Yeah. So, um, you know, are those FAQ is going to be made public?

Noah Brockman (05:13):

Oh, most definitely. They SP has been doing a really good job, um, providing access to program information and documents, um, up on there. Um, has the dog program portal or program landing page. Okay.

Amber Faist (05:34):

Um, great. So, uh, just to note that in our resources, we will drop the links for those FAQ’s. Um, we’ll also put the link in there for, um, the SBA webinars, should it be available? Um, and, and also, um, no, I just kind of want to, you know, just take a step back, I guess, and get ready. Cause you talked little bit about those principles, business activities. So, you know, for a business that, um, you know, sells, you know, uh, like food and beer and wine, and then they have like a stage in the back where they have live entertainment, um, would they, would they classify under an SPOG grant? Um, or would it be kind of more of a restaurant revitalization grant recipient?

Noah Brockman (06:24):

Yeah, so probably if, you know, if there a Tavern or a bar or a restaurant and they happen to have a stage that they use for bands or karaoke or whatever, I would just think of those as like entertainment to keep all the diners and, and, um, you know, patrons engaged and entertained as they go about their business. But the primary business activity there is, is restaurant bar Tavern. And so the business select that would, would want to look into the restaurant revitalization grant fund, which is kind of this other program. I know that we wanted to talk about,

Amber Faist (07:09):

Well, before we get over to the second grant, cause we’re talking about two here, um, just, uh, to kind of gain a little bit of insight. So with the shuttered venue, um, grant, so this grant is made available to, um, tribally owned museums. Um, but it is my understanding that is not available for, um, things like casinos and gaming. Um,

Noah Brockman (07:36):

It’s not, no, I looked that up. I thought it would be, it seemed like it would make sense, but no, it doesn’t mention anything about casinos or gaming, but absolutely tribal museums it’s, it’s actually stated there in the program information.

Amber Faist (07:55):

Yeah. And then you mentioned one other thing about the shuttered venue grant, um, that I wanted to call out specifically. So if there is a venue that has multiple locations, they can apply for the grant one time, but if they have multiple business formations for different locations, they will need to apply for each of those businesses individually.

Noah Brockman (08:18):

Yeah. So the program allows for up to five, um, affiliated entities to apply. So in that first case example that you just mentioned, it would be like one business owns four or five locations. So the benefit there for them, with how they would apply for this program is they would only have to apply one time. The, the latter example where you have four or five affiliated businesses, all owned by the same folks, but operating as, you know, four or five separate entities, LLC, one, two, three, and four and five, they would have to likely apply five times four or five times individually, each having a Sam, its own, um, registration, each having its own DUNS number. I mean, it’s, it’s a bit of work, but you know, I guess, um, you know, the payoff is this is a Mo this could be multimillion dollar grant. So certainly worth the time and effort, uh, in all ways.

Amber Faist (09:33):

Can you talk a little bit about the timeframe that this grant is kind of taking a look at? Is this from last year going into this year, like what’s the grant kind of covering?

Noah Brockman (09:46):

Um, so it would essentially cover business activities. So if they were in business as of February 29th, 2020, um, it would cover that timeframe on forward. So, um, let’s see if I can put the dates. I mean, that’s the start date, February 29th, 2020. So they have to be operational as of that date and be able to prove it with supporting documentation.

Amber Faist (10:21):

And then, um, can you just kind of talk a little bit more around, I, you know, that that would be the start date. So how was that calculate- How was that grant calculated?

Noah Brockman (10:30):

Okay. So, um, at a minimum they have to show a 20% revenue loss to qualify. It’s a maximum $10 million loan and it’s calculated, um, it’s 45% of gross revenue. So if they, yeah, so they would, what they would do is look at, let’s say, 2019 gross revenue and multiply that by 45% and they would take that number. So if it was a million dollars in gross revenue in 2019, the grant amount would be $450,000 for a business that let’s say, um, wasn’t operational for the entire 12 months of 2019. They would, um, just say, you know, what is the average 2019 month of revenue? And I think multiply that by six and then the usage of the grant funds and really covered the same kinds of things that are covered by the EIDL on operational expenses, payroll, rent, utilities, mortgage principal and interest payments. This is not to go out and buy a new, real estate, or buy a bunch of new equipment, um, and can cover a state and local taxes, fees, cover existing debt, service administration, uh, existing leases, insurance. Um, so, and then they have essentially from expenses, you know, uh, expenses between the timeframe of, um, what is it March 1st, 2020 all the way forward into December 31st, 2021. So that’s the timeframe in which to use the funds and they got to use it up by the end of the year, December 31, 2021 this year, use it or lose it, basically. They don’t use it. They’ve got to give it back.

Amber Faist (12:43):

Is that, so I’ve heard you refer to it as a loan and a grant. So are they kind of, uh,

Noah Brockman (12:50):

Thank you for keeping me honest. This is absolutely a grant. This is not a loan. You don’t have to repay it unless, they don’t use up all their funds if they don’t use up all the funds. As I say, by the end of this calendar year, they would have to give that back.

Amber Faist (13:06):

Okay. This is the Shuttered Venue Grant that we’re talking about. And, you know, um, I just, I know that because this is released at the same time as the Restaurant Revitalization, um, program that we like there is a distinction here, but is it, um, you know, in a similar way you have the similar timeframes? Is it the similar like uses for the Restaurant Revitalization Grant? Um, I’d like to call the commonalities before we start talking about the differences.

Noah Brockman (13:37):

Okay. Um, pretty similar. I mean, they’re both maximum $10 million grants. I think the uses are the same, except that on the restaurant front they, it also covers like food and beverage costs, ingredient costs, on the restaurant side, right? That’s the restaurant grant and that stuff isn’t relevant for shuttered venues. Um, there’s, this is getting a little down in the weeds, but so they both have some priority periods in terms of who can apply on the Shuttered Venue Operator Grant. The first two. Well, the first prior priority is folks who businesses that had a 90 that showed a 90% loss. Um, and I, I think it’s 2020. Um, the second group would be the 75% gross revenue loss. And then the third would be at least a 25%, um, earned revenue loss from April through December, 2020. So, um, I mean, like I said, there’s also some priority groups that are designated for the restaurant revitalization grant fund. Um, and I can talk about that now, or we can come back to that. It’s up to you.

Amber Faist (15:19):

Um, let’s uh, let’s, let’s just go ahead and dive in. Um, if you want to talk about, um, you know, maybe a little bit about the restaurant revitalization program, I keep calling it a program, but, um, maybe give us a few details, a few updates

Noah Brockman (15:37):

The SBA restaurant revitalization fund, it’s a grant program, the Biden’s America’s Rescue Plan Act – ARPA, um, congressional appropriation for the program, I believe is 28.6 billion. Um, it covers, uh, this time period, um, where restaurants may have been affected from as early as February 15, 2020, extending outward into March 11th, 2023. Um, this is also a maximum $10 million grant up to like total, total, right? So the maximum any entity group can take with this grant is 10 million. And if they have multiple locations, they could max out per location at 5 million, but only up to 10 million total. Um, the, uh, the calculation for this grant, pretty simple, we like simple simple’s good. Um, so they would take their 2019 revenue subtract the revenue they had in 2020, which we would suspect would be less than the prior year. And then they would subtract out any PPP loans they got. So 2019 revenue minus 2020 revenue minus PPP loans. And then for those businesses, not in business all of 2019, they would, um, essentially take their average 2019 revenue multiply that by 12. So average monthly revenue from 2019, multiply by 12, and then again, subtract 2020 revenue and subtract PPP. Eligibility – so this is, you know, restaurants, food carts, uh, caterers salons in, or saloons, rather not salons saloons, um, taverns bars, coffee shops, brew pubs, um, tasting rooms, tap rooms.

Noah Brockman (17:55):

Um, but there is some, some interesting things there with the, the, like, let’s say the Oh, and bakeries. So for the bakeries brew pubs, tasting rooms, tap rooms, um, they have to demonstrate at least 33% of onsite sales and consumption for that for the, for them to qualify for this program. So, you know, because they’re also likely, um, you know, maybe wholesaling and maybe selling into retail. So because this is the Restaurant Revitalization Fund, um, I think that will kind of helps keep them in the bounds of the intent of the program. Um, so the use of funds it’s, uh, you know, it’s operational expenses, so payroll rent, mortgage principal, and interest payments, utilities, maintenance, um, PPE, food and beverage cost of goods supplies. And I did mention that there’s some priority periods. So the first 21 day priority period, um, uh, puts the priority on applicants from businesses owned by women, veterans and socially and economically disadvantaged business owners.

Noah Brockman (19:24):

So that means, but that’s not to say that everyone else who doesn’t meet those, those, uh, those qualifications can’t apply, they can absolutely apply, um, and get into the queue. But for the first 21 days, women, veteran owned and socially economically disadvantaged business owners will those applications will flow. Once they’re completed, they’ll flow through the portal for SBA approval while the other ones will kind of wait in the queue until after the 21 days pass, um, Congress wanted of this program to be really simple, to apply. So they didn’t require like the registration and the DUNS number like they did for SVOG. So they really wanted to keep it simple. And I think they’ve done a pretty good job of that.

Amber Faist (20:19):

You, um, do you know when that 21 day period is, is ending?

Noah Brockman (20:28):

Um, I’d have to check. It seems like we’re in week two now. So my guess is sometime next week. That’s a great question.

Amber Faist (20:41):

Again, we’ll probably link it in the resources tab,

Noah Brockman (20:46):

Some updates from us SBA on this program that, that I could throw in here that are kind of interesting in terms of, you know, number of applications and that kind of thing. There was a lot of concern that the money would go really fast and, you know, 28.6 billion is nothing to sniff at. So hopefully it’ll be around for a little while

Amber Faist (21:09):

I think we can go into some numbers and then we’ll end with questions at that.

Noah Brockman (21:13):

Okay. All right. So some updates from SBA. So this week they sent out a press release and it looked like from what they were indicating, there were 266,000 applications, um, received 700, I’m sorry. 76,000 of those were from women owned businesses, 6,000 were from veteran owned businesses and 42,000 were for socially and economically disadvantaged business owners. Um, and thus, uh, so that’s according to my notes, 147,000 applications from women, uh, veterans and socially and economically disadvantaged business owners. Um, it looks like they’ve awarded about $2 billion of the funds. And, um, Oh, actually, so as of, uh, May 12th, they had approved 21, they have approved were awarded 21,000 awards worth 2.7 billion. So that’s, uh, that’s about 10%.

Amber Faist (22:41):

So your feeling is that we’ll have a little bit more time with this. Um, it’s not all kind of like, it was, I think with the first round of the PPP where there was like a mad dash and then all of the money was gone and a lot of people left feeling kind of left out of that.

Noah Brockman (22:59):

Yeah. And, and, you know, there’s, um, like I said, everyone can apply and get into the queue. Um, so there’s absolutely no reason to wait to apply. Um, in fact, everyone, if, if they’re going to, they should just get on it. Um, it’s a pretty quick application and they’re there two, um, point of sale, um, platforms that business owners, uh, oftentimes have in the restaurants where they can apply directly. I think it’s it’s Square and Clover and then there’s, um, Toast and Aloha, I think it is, or kind of partially providing some kind of, um, access. I don’t think they’re doing the full application, but so that’s something to check out if the business has a point of sale, um, merchant processing platform that they use to see if, if their platform is fully plugged into SBA for this.

Amber Faist (24:05):

So just want to acknowledge that, you know, these are, these are two very large programs and they may be pretty confusing. Um, the, the point is, is that these funds are, are here and available to really help businesses get back on track and, um, ONAC as well as I know, um, Noah’s team, the Capital Access Team with the Oregon SBDC. They’re really here to help navigate through this. And, um, Noah, if, if anybody wants to get in contact with you, has any questions. Um, can you share a little bit about how they would, how they would reach you or someone from your team?

Noah Brockman (24:40):

Yeah, so we have, um, so there are CAT regional advisors across the state six regions across the state. Um, they, if they, if they want to, they can go to our website at, um, So, and, uh, go to the top right section of the page where it says start, and you can, um, pull down the map of the six regions, plugin information about your business, and that sends us a request to, for assistance, and then we’ll follow up and, um, having an initial conversation. And then usually, you know, if it turns out that, um, the business wants to work with us, we’ll just have them register as a new SPDC It’s an online registration free to do. It takes about five minutes, get some in our system and then that way we can work together.

Amber Faist (25:45):

Great. Um, and then again, you know, um, own is here as a resource as well. So if you have, um, you know, some quick questions or just want to get somebody on the phone, um, you can feel free to reach ONAC at (503) 894-4525. And that phone number can also be found on our website. Oh, and Um, thanks so much, Noah. I really appreciate you spending some time this afternoon and, um, helping get the word out about these grant programs. I know that, um, funding has been a real big need, uh, in these last months and even years. So, um, just really appreciate your expertise and knowledge,

Noah Brockman (26:26):

Happy to help it takes a village.

Amber Faist (26:29):

All right. Thanks. Okay.