Restaurant Revitalization Fund application portal closes
The SBA recently announced that the RRF grant portal will be closing the application portal on July 14th. Until that date, applicants can access the site to get an update on their requests but cannot file new funding applications given that the program ran well short of demand within days of opening in early May 2021.
As originally created by Congress, the RRF included a “Priority 1” group of applicants consisting of women, veteran, and/or economically-disadvantaged owners that would receive priority review and funding. As anticipated, requests from this group (147,000 applications totaling $29B), outstripped total funding for the program ($28.6B). This meant that other applicants would not receive any funds, regardless of their financial need.
As funding commended in late May, a series of federal court injunctions disrupted this funding flow, and as a result, thousands of “Priority 1” applicants learned that their grants were being rescinded. As a result of this change, the final funding of the RRF included the following:
- Priority 1 grants totaled $18B (prior to injunctions)
- Women-owned businesses totaled $7.5B
- Veteran-owned businesses totaled $1B
- Socially and economically-disadvantaged owned businesses totaled $6.7B
- Multiple underserved populations totaled $2.8B
- Not identified with underserved group totaled $10.6
- Average grant award was $283,000.
It is not currently known when/if additional funding will be made available. There is pending legislation that would add up to $60B to the funding pool, but it could take months before this might become law.
Paycheck Protection Program
Now that millions of small business owners are seeking forgiveness for their small-balance PPP loans, many are having to repay small portions of the loans due to changes in approval guidelines for the program by the SBA that post-dated the funding of the loans but were deemed to be retroactive.
As a result, some amounts approved are not eligible for forgiveness, typically in the range of a few thousand dollars. Sole proprietors were particularly impacted by these changes (over time there were numerous generations of FAQ updates).
Lenders have also been informed by the agency that any amounts not forgiven must be repaid by the borrower.
The SBA recently announced that the agency will establish a new portal that will allow
borrowers to apply directly to the agency for forgiveness. At this time it is not known how the these discrepancies will be addressed, especially given these loans have no collateral or guarantees.
Economic Injury Disaster Loan
When the COVID EIDL and the first advance programs were established in March 2020, they were administered by the Office of Disaster Assistance. To address some issues that have caused delays in the EIDL application process, within the past 10 days the SBA has announced that soon the program will transition to the Office of Capital Access, which has been managing the PPP, 7(a), and 504 loan programs. This office also managed the RRF, which relied heavily on technology to speed approvals and disbursements.
It is anticipated that the new management team will be in place by mid-to-late July.
Rebuild VA! Program to Reopen
The Governor has announced that the Commonwealth will receive roughly $353 million from the latest round of COVID relief funds approved earlier this year by the federal government.
The current plan is to use the funds in the following ways:
• $250 million for the RebuildVA! Program
• $50 million for the Virginia Tourism Corporation
• $53 million for the Industrial Revitalization Fund and the Virginia Main Street Fund
The Governor also indicated that the RebuildVA! Program will be available to awardees that received less than allocated or received no money due to funding shortfalls, and/or to new applicants. No additional details are available at this time so stay tuned for more information as it becomes available. This could be good news.
