Biden's $1.9T stimulus includes $15B grant program for small businesses

Dive Brief:

President-elect Joe Biden provided details on his $1.9 trillion American Rescue Plan on Thursday. Financial assistance laid out in the program includes a $15 billion grant program to over 1 million of the hardest hit small businesses and a $35 billion investment toward local financing programs to offer low-interest loans to entrepreneurs.
His proposal also includes increasing the minimum wage to $15 per hour and ending the tipped minimum wage and sub-minimum wage for people with disabilities.
While the financial aspects of Biden's plan don't specifically target restaurants, it does appear to open the door to future relief. The Independent Restaurant Coalition said in an emailed statement that it is "encouraged by President-elect Biden’s repeated and outspoken support for direct aid to independent restaurants and bars, especially as we remain one of the only industries seeing shrinking employment and closed doors across the country."

Dive Insight:

Biden would also like to work with Congress to ensure that restaurants, bars and other businesses that have been hit hardest during the pandemic have support for recovery, including through the Community Credit Corporation at the U.S. Department of Agriculture, according to the proposal. Biden has previously expressed support for the restaurant industry and for providing the sector grants instead of loans.

The proposal also includes a plan to partner with restaurants to feed families in the U.S. and keep workers employed through the FEMA Empowering Essential Deliveries Act. This program would work with restaurants to get food to families and help bring laid-off restaurant workers back to work.

"It is clear President-elect Biden wants to take action to address the unique devastation the pandemic brought to America’s independent restaurant and bar community," IRC said in a statement. "President-elect Biden's plan opens the door for Congress to pass the bipartisan RESTAURANTS Act and ensure America's second largest employer gets the grants they need to fully reopen and secure 11 million jobs. Unsustainable debt, cold weather, and a surging pandemic have left many restaurants and bars out of options this winter. We are optimistic the new administration and Congress can quickly work together to protect local restaurants and bars from permanently closing with a new stimulus package."

This proposal comes at a time when restaurants are facing an increase in unemployment, with a second surge in coronavirus cases resulting in increased restrictions on indoor dining. In December, restaurant job losses jumped to over 372,000 in the industry, up from 17,000 in November.

But not all in the restaurant industry are happy with his proposals. The Restaurant Workers of America, a grassroots organization of tipped restaurant workers, condemned Biden’s proposal to end the tipped credit. The organization claims that 70% of restaurant workers prefer the tipping system and tipped wages over a flat rate, according to a statement emailed to Restaurant Dive.

"The thousands of restaurant workers who supported Joe Biden feel betrayed tonight, to see him endorse a policy that would be so harmful to our industry,"Joshua Chaisson, vice president of the RWA and a restaurant worker, said in a statement. "Countless restaurant workers — myself included — were displaced due to COVID. As the industry starts to recover, we need a President who understands that tipping and tip credits are essential for employees and employers."