WILMINGTON – As the leader of the U.S. Small Business Administration toured downtown Wilmington this week, Delaware’s two U.S. senators confirmed that they are backing a bipartisan bill to replenish the agency’s depleted Restaurant Revitalization Fund (RRF) with $60 billion in new funding.
Spokespeople for both Sens. Chris Coons and Tom Carper confirmed that they would support the Restaurant Revitalization Fund Replenishment Act of 2021 sponsored by Sen. Krysten Sinema (D-Ariz.), which aims to add $60 billion to the fund that doles out grants to restaurants that have seen sales impacted by the pandemic. The original $28.6 billion allocation was exhausted in days, leaving nearly two-thirds of applicants without any aid.
Restaurant industry lobbyists were targeting the senators as among those to add their support to the bill that has only 14 cosponsors. Spokespeople for the senators explained that Sinema’s office is only adding cosponsors in bipartisan pairs though, with many Democrats reportedly awaiting Republican partners to come to the table.
“The senator was a strong supporter of the original RESTAURANTS Act. Right now, it’s unclear about [the Replenishment Act’s] prospects of passage, however, it’s something the Senate Small Business Committee and the administration are in contact about,” said Brendan Mackie, state press secretary for Coons’ office.
The prospect of additional RRF funding comes shortly after U.S. Small Business Administrator Isabel Casillas Guzman talked with local restaurateurs in Wilmington about their interactions with her agency.
“We could never have survived without the aid of the SBA,” said Alisa Morkides, owner and founder of the local Brew HaHa! coffee shop chain who met with Guzman at her Delaware Avenue shop. “There was no money coming in. I had nothing … We really did not know if we’d survive the pandemic. It was touch-and-go for a while.”
Morkides and her husband borrowed their personal savings to make the company’s payroll in the early days and even ended up selling their house and moving in with her mother and stepfather as a personal sacrifice after being forced to furlough staff.
“I think it taught me that I want to sleep at night and that I can survive on very little,” she said.
Seeking aid, Brew Haha! tapped into the SBA’s Paycheck Protection Program (PPP) and the RRF, obtaining millions to help stabilize their operation. Morkides noted that sales dropped nearly 70% at some points last year, and the company finished the year at a loss of $1.2 million. The company has been able to reopen nine of its 10 locations – it’s permanently closed one on Market Street in Wilmington – and rehire about 90 employees, down about 25% from pre-pandemic days.
“Having these funds from the SBA allows us to power through this time and gives us hope and optimism that we can emerge even better and stronger,” she said, noting sales are picking back up.
Meanwhile on Market Street, Rob Snowberger, co-owner of Stitch House Brewery, echoed Morkides’ experience, noting that they obtained PPP loans, RRF grants and an Economic Injury Disaster Loan (EIDL) to help keep the business afloat. Between state and federal low-interest loans, Snowberger said the brewery’s debt load has increased about 250%, but it’s helped keep their doors open.
Stitch House had a favorable experience with the RRF as its point-of-sale system, Toast, integrated with the SBA’s application to streamline the process, he said. With Snowberger and co-owner Dan Sheridan qualifying for the RRF’s priority review for underrepresented applicants, including minorities and military veterans, they were initially approved for grants for Stitch House and another restaurant they own, Locale BBQ Post in Trolley Square.
Following federal lawsuits over the priority review period in Tennessee and Texas, the SBA did not allocate the grant for the barbecue restaurant though. The partners are waiting to see whether the additional RRF funds could assist them, just like more than 475 other restaurants in Delaware that applied but weren’t funded.
“I think the SBA did a great job and ultimately it’s Congress that needs to come up with the money,” Snowberger said.
For now, Stitch House is ramping operations back up and still searching for additional staff like most restaurants today as the industry faces an unexpected labor shortage. The brewery is approaching its pre-pandemic sales trend, but in very different ways than two years ago.
“The business has changed. We’ve completely lost the business lunch crowd; it’s gone,” Snowberger said of the scene downtown where major office employers have been cautious about returning thousands of workers. “The regulars who are living downtown are actually supporting us. That’s what’s really impressive. Even though our market has fundamentally changed, it seems that the revitalization and the apartment leasing have kept things afloat.”
Stitch House has found it can still draw a crowd with live music, especially when the weather is good and patrons can sit outside in the expanded parklet seating, Snowberger said. They’ve also seen a bump in business from promotions aimed at youth sports tournaments that are hosted at the Chase Field House.
“I would love to grow into a massive distribution, but right now we’re very happy that we’re able to serve the downtown community and be the local beer,” he said.
