7 Major Coronavirus Developments — Federal Funds Little Help to RI Restaurants — April 13, 2020
Monday, April 13, 2020
Rhode Island restaurateurs are warning the federal stimulus may do little to help them.
The stimulus and specifically the Paycheck Protection Program was intended to provide short-term loans — that may be forgiven for companies if they keep their workers on the payroll.
The U.S. Department of Treasury writes, “The loan amounts will be forgiven as long as: The loan proceeds are used to cover payroll costs, and most mortgage interest, rent, and utility costs over the 8 week period after the loan is made; and Employee and compensation levels are maintained.”
GET THE LATEST BREAKING NEWS HERE -- SIGN UP FOR GOLOCAL FREE DAILY EBLAST“To qualify for PPP loan forgiveness, at least 75% of the funds have to be used for payroll, and both employee count and payroll levels need to be restored to pre-disaster levels. This creates two major problems for restaurants,” said Jordan Boslego, who owns Sydney — with locations in Providence and Portsmouth.
The Sydney cafes in Rhode Island have been a hit — “Sydney is where Australian inspiration meets local ingredients and a passion for quality. we are an all-day café distinguished by easygoing sophistication, finest-quality healthy ingredients, and cheerful service.”
WATCH: Former RI Director of Health Dr. Michael Fine on GoLocal LIVE at 12 PM on Monday
“It's highly unlikely that things will return back to normal quickly enough to justify returning to full operations within 8 weeks. Second, we are likely to face major problems recruiting and rehiring staff while the increased unemployment benefits are still in effect, if returning to work pays far less than remaining at home. Therefore, unless there are changes to the requirements, most restaurants are unlikely to qualify for forgiveness,” said Boslego.
Bob Burke of Pot au Feu writes in an email to GoLocal:
A man walks into a bar and says - I’ll have a beer.
They serve him caviar and champagne, a filet mignon, great Bordeaux and a Creme Brulee with Cognac.
When it’s time to pay - bartender says no charge.
He says, Great, I’ll have another beer.
People aren’t stupid or crazy - the same unfortunately cannot be said for politicians. American politics is full of examples of truly horrifying unintended consequences that have caused more harm than good. This is a perfect example of that happening. There can be no economic recovery without workers.
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