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Our attorneys stay on top of changes in legislation, agency regulations, case law, and industry trends—then craft timely legal alerts to keep clients up to date on legal developments important to their business.

September 8, 2020

COVID-19: Anticipated RESTAURANTS Act of 2020 Will Establish a $120 Billion Fund for Assistance

Employing approximately 10-percent of the US workforce, the food and beverage industry has been decimated by COVID-19. Millions of jobs have been lost, and countless restaurants and bars have been forced to suspend or limit their operations or close down entirely. In addition, those who provide services integral to the food and beverage industry—including farmers, fishermen, suppliers, distributors, and truckers—have been negatively impacted by the economic downturn. But help may be on the way.

Congress recently proposed a relief package for restaurants distressed by COVID-19. The Real Economic Support That Acknowledges Unique Restaurant Assistance Needed to Survive Act of 2020 (RESTAURANTS Act) would establish a $120 billion fund to be administered by the US Department of the Treasury for structured relief to food service or drinking establishments through December 31.

If the RESTAURANTS Act is signed into law, businesses eligible for a grant under the fund would include restaurants, food stands, food trucks, food carts, caterers, saloons, inns, taverns, bars, lounges, and other similar places of business in which the public or patrons assemble for the primary purpose of being served food or drink that, as of March 13, were not:

a) Part of a chain or franchise with more than 20 locations doing business under the same name, regardless of the type of ownership of the locations

b) Publicly traded, including a subsidiary or affiliate thereof

c) Part of a state or local government facility other than an airport

For the covered period (February 15 to December 31, 2020), eligible businesses may receive a grant to be used for the following, in the event the RESTAURANTS Act is passed and becomes law:

  • Payroll costs
  • Payments of principal or interest on any mortgage obligation
  • Rent payments, including rent under a lease agreement
  • Utilities
  • Maintenance, including construction to accommodate outdoor seating
  • Supplies, including protective equipment and cleaning materials
  • Food and beverage
  • Debt obligations to suppliers that were incurred before the covered period
  • Any other expenses that the Department of the Treasury determines to be essential to maintaining the eligible entity

Barclay Damon LLP’s Hotels, Hospitality & Food Service Team is available to help you better understand the pending legislation and can partner with attorneys in any of the following firm practice areas to further assist with additional issues impacting the food and beverage and leisure industries:

  • Commercial Litigation
  • Corporate
  • Financial Intuitions & Lending
  • Labor & Employment
  • Land Use & Zoning
  • Insurance Coverage & Regulation
  • Intellectual Property Litigation
  • Real Property Tax & Condemnation
  • Real Estate
  • Restructuring, Bankruptcy & Creditors’ Rights
  • Regulatory

Barclay Damon LLP will continue to keep you informed on the status of the proposed RESTAURANTS Act and similar federal and state programs that may benefit you in this unprecedented time.

If you have any questions regarding the content of this alert, please contact Scott Rogoff, Hotels, Hospitality & Food Service Team leader, at srogoff@barclaydamon.com; John Gaughan, partner, at jgaughan@barclaydamon.com; or another member of the firm’s Hotels, Hospitality & Food Service Team.

We also have a specific team of Barclay Damon attorneys who are actively working on assessing regulatory, legislative, and other governmental updates related to COVID-19 and who are prepared to assist clients. Please contact Yvonne Hennessey, COVID-19 Response Team leader, at yhennessey@barclaydamon.com or any member of the COVID-19 Response Team at COVID-19ResponseTeam@barclaydamon.com.

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