American Rescue Plan Act faces US Senate scrutiny this week

U.S. foodservice industry groups celebrated after the House of Representatives passed the American Rescue Plan Act – U.S. President Joe Biden’s proposed USD 1.9 trillion (EUR 1.6 trillion) COVID-19 relief plan – in the early morning hours of Sunday, 28 February.

The legislation includes a USD 25 billion (EUR 21 billion) restaurant grant program, as well as USD 3.6 billion (EUR 3 billion) to support the food supply chain, including food purchases and loans to small- and mid-sized processors, with a specific mention of seafood processing facilities. The bill also calls for the creation of a USD 15 billion (EUR 13 billion) grant program for small business owners, separate from the existing Paycheck Protection Program.

The bill will now be considered by the U.S. Senate, where hearings will begin on the package as soon as Wednesday, 3 March, according to Politico.

John Connelly, president of the National Fisheries Institute, the largest U.S. seafood trade group, said last month that bolstering the foodservice sector is a major priority for the seafood industry.

“We are so dependent on restaurants for sales and until those get going again, we’re not going to be robust as we can be,” he told SeafoodSource. “I realize lots of companies have made amazing shifts into retail and those companies have done a great job, but at the end of the day we need the restaurants and need to work through this next package to get them the support they need, because ultimately, if we help our customers, we’re helping ourselves.”

The Restaurant Revitalization Fund included in the legislation would award grants to restaurants and bars with demonstrated losses for eligible operating expenses such as payroll, mortgage, rent, and utilities.

“Congress is helping millions of people who rely on restaurants and bars for their livelihood feel a little more optimistic,” Independent Restaurant Coalition Executive Director Erika Polmar said in a press release. “Every week, more restaurants close and record numbers of unemployment claims are filed.”

The bill would provide aid to an industry that has seen 110,000 restaurants and bars close their doors since the start of the pandemic and nearly 2.5 million restaurant employees lose their jobs, according to the IRC.

Even with the vaccination rate rising in the United States, restaurants still face unprecedented financial uncertainty in the coming months. In January, consumer spending in restaurants remained well below pre-pandemic levels, according to a new National Restaurant Association survey. Seventy-seven percent of restaurant operators said their total dollar sales volume in January was lower than it was in January 2020.

Thirty-two percent of restaurant operators believe it will be 7 to 12 months before business conditions return to normal for their business, while 29 percent think it will be more than a year. An additional 10 percent of operators say business conditions will never return to normal for their restaurant, the survey found.

The House passage of the American Rescue Plan is “a huge win for struggling restaurants in every community,” National Restaurant Association Vice President of Public Affairs Sean Kennedy said in a press release.

However, the restaurant industry does not support a minimum wage increase, which is included in the House’s version of the American Rescue Plan. The plan’s inclusion of the Raise the Wage Act will “needlessly harm tipped servers and restaurants when they are most at risk of closing their doors for good,” Kennedy said.

“We need an agreement that supports the return of the restaurant jobs needed for local economies to recover from the pandemic, but that doesn’t penalize our workers or slow our rebuilding. We will continue to work with Congress to find this solution,” Kennedy said.

Photo courtesy of Stratos Brilakis/Shutterstock