Today, Congress unveiled a $900 billion relief bill to provide short-term economic relief to the country in the face of the coronavirus pandemic. The plan includes several items that will benefit restaurants, bars and hotels, most importantly a second round of access to the Paycheck Protection Program (PPP), with unique provisions aimed to assist the hospitality industry, which continues to endure unparalleled job and revenue losses.
“This bill will help the North Carolina hospitality industry with much needed capital that will create more time for us to work with Congress to engineer the additional programs to save our beloved community restaurants, bars and hotels,” said Lynn Minges, President & CEO of NCRLA. “From the early days of the pandemic when North Carolina restaurants and bars were shut down and travel was restricted, the North Carolina Restaurant & Lodging Association has worked with the National Restaurant Association, American Hotel & Lodging Association and other partners to press Congress and the Trump Administration for both long-term and short-term economic support,”
The plan announced today targets restaurant, bar and hotel relief with provisions including:
- Enhanced PPP Loan Size: The PPP provides a business with a forgivable loan based on 2.5 times its monthly payroll costs. Restaurants and hotels, however, can seek forgivable loans based on 3.5 times monthly payroll costs.
- Enhanced Access to PPP: Companies that employ a total of 300 or more employees at all locations (combined) are deemed ineligible for the PPP. Today’s bipartisan plan reflects the reality that many mid-sized and larger restaurant, hotel and hospitality groups are on the verge of bankruptcy and allows them to qualify for PPP as long as they do not employ more than 300 employees at each physical location.
- One-year extension for Troubled Debt Restructuring (TDR) relief (Section 4013 of the CARES Act). This will allow for banks to continue to work with borrowers to gain additional forbearance and debt relief through the end of 2021.
Other provisions in the bill that will benefit restaurants, bars and hotels include the deductibility of business expenses paid with PPP loans, enhancement of the Employee Retention Tax Credit (ERTC), extension of the augmented Work Opportunity Tax Credit (WOTC), and increased tax deduction for business meals.
“The past nine months have been the most challenging ever for the hospitality industry,” said Minges. “We are proud of the many partners and friends who came together across our state to push for this stimulus package. We recognize that today’s bi-partisan stimulus package was a hard-fought battle in Congress, and we are appreciative to members of our NC Congressional delegation for their unwavering support for our industry. We see this as a ‘down payment’ on the relief we ultimately will need to make NC restaurants and hotels whole, and we look forward to working together in the new year to address those needs.”
About NCRLA
Established in 1947, the North Carolina Restaurant and Lodging Association serves to advance and protect the interests of more than 20,000 businesses who employ 11 percent of the state’s workforce and generate more than $27.3 billion in sales annually. The association provides access to the resources and support restaurant and lodging professionals need to lead thriving businesses, while serving as conscientious, contributing members of an unparalleled industry. To learn more information about NCRLA or its membership opportunities and cost-saving benefits, please visit www.ncrla.org.
