Courtesy of Floriana
Courtesy of Floriana

“I haven’t seen a penny from anyone yet,” says Jamie Branda, the owner of Floriana in Dupont Circle. “I literally don’t know a single owner in the industry who has received a penny either locally or federally.” 

It’s been a month since Mayor Muriel Bowserclosed D.C. restaurants and bars to on-premise consumption because of COVID-19, drastically reducing the hospitality industry’s earning potential and forcing mass layoffs. On Wednesday, April 15, Bowser extended the city’s stay-at-home order and public health emergency from April 24 to May 15. 

Early on in the crisis, it seemed like plenty of aid was available for restaurants and other small businesses, including the District’s $25 Million Small Business Recovery Microgrant Program, the Small Business Administration’s Economic Injury Disaster Loan (EIDL), and the $349 billion Paycheck Protection Program (PPP) included in the CARES Act Congress passed last month. 

But Branda’s concerns are common, at least anecdotally. Few restaurant owners report receiving any financial support to help them survive the economic impact of the pandemic, and some are still on the hook for rent payments, utilities, and other expenses. City Paper checked in with three local operators to find out what help they’ve applied for and how the waiting game is going. 

Floriana, a 41-year-old Italian restaurant, is still open for take-out and delivery orders. “We’ve jury-rigged our system where we can sustain for several months,” Branda says. “But that’s without my servers getting tips, that’s without my food runners, line cooks, and bussers.” While he has laid off some employees, staff convene virtually once a week to divvy up any tips from to-go food. “If someone is getting unemployment and their rent is caught up, they might say, ‘take me out of the pool for this week.’” 

Restaurants like Floriana need grants and loans because their insurers have declined to provide business interruption coverage during a global pandemic. A growing number of restaurant owners nationwide are filing lawsuits against their insurance companies, includingProper 21 in D.C.

“I don’t know if we’ll join any lawsuits,” Branda says. “We’re at a wait and see point. I understand insurance companies not wanting to take this big hit, but on the other hand their only business is to protect people with policies. The purpose of insurance is to sleep at night.”

Branda is banking on all three sources of aid to come through: PPP, an SBA EIDL loan, and the microgrant program administered through D.C.’s Office of the Deputy Mayor for Planning and Economic Development (DMPED). Applications for the city’s microgrant program closed on April 1. Small businesses, nonprofits, independent contractors, and self-employed workers submitted a total of 7,623 applications. 

“It took them nine days to send out a confirmation email,” Branda says. “I don’t think the city has any idea how to handle this. I don’t think they have the machinery or infrastructure in place to facilitate this program … We’re dealing with a 2020 problem trying to use 2002 answers.” 

The city hasn’t clearly explained how it will divide the $25 million pool among applicants. Some applicants thought it would be split evenly, giving each applicant less than $3,500. Floriana brings in twice that amount on a slow, rainy Sunday when brunch isn’t buzzing, according to Branda.

A DMPED spokesperson only says that awards of up to $25,000 will be made and that the funding will not be split evenly. The agency expects to decide who gets what by the end of April and disburse grant funding soon after. “There isn’t a business that hasn’t lost $25,000,” Branda says. “If that program was $250 million, there might be enough to help people a little bit.” 

The SBA EIDL loan Branda applied for promises up to $2 million in assistance, with a 3.75 percent interest rate and 30-year repayment schedule. The SBA included an option to apply for a completely forgivable advance payment of up to $10,000—$1,000 for every full-time or part-time employee. 

While the SBA was required by law to issue the advances within three days of a business applying for immediate relief, thePost reported that many applicants have waited weeks. 

Branda applied for the $10,000 advance on April 3 and hasn’t received any money. Neither hasTiffany MacIsaac, co-owner of Buttercream Bakeshop in Shaw. She applied on April 1 and hasn’t heard a word from the SBA.

MacIsaac applied for somewhere between $30,000 and $40,000 in grants and was optimistic she’d get at least $10,000 to cover one month’s rent. She’s tried to manage her expectations given how many businesses are in dire straits. “My business doesn’t deserve it any more than any other business,” she says. “We’re all grasping at straws to do the best we can.” 

As Washingtonians cancel parties, MacIsaac has had to issue refunds for whatever treats hosts ordered. When it comes to weddings, most couples have opted to postpone their celebrations instead of canceling them outright, but that still has an impact on Buttercream Bakeshop’s bottom line. As spring weddings become fall weddings, MacIsaac has had to turn down new bookings. “It’s displaced future revenue and makes me worried about when we come back to business,” MacIsaac says. Currently the shop is only selling six-inch cakes to try to cover rent. Her landlord, like many, hasn’t given the business a break. 

In addition to the $10,000 SBA EIDL advance she hasn’t received, MacIsaac didn’t get a grant from the James Beard Foundation Food and Beverage Industry Relief Fund. On its website, the foundation says it closed off applications within hours of launching “due to overwhelming response.” She’s still waiting to hear about D.C.’s microgrant program.

MacIsaac was primarily counting on the $349 billion Paycheck Protection Program designed to incentivize small businesses to keep workers employed. Loans associated with the program are capped at $10 million and issued through SBA-approved lenders. If 75 percent of the funds are used to keep staff on payroll for eight weeks at rates similar to before the pandemic, the loan will be forgiven. The other 25 percent can be used for costs like rent and utilities. 

Demand for the program was significantly higher than expected and banks were immediately inundated. On April 16, the SBA announced that the PPP had officially run out of money and was no longer accepting applications. The agency approved more than 1.6 million loans totaling more than $339 billion from more than 4,900 lending institutions. Congress is currently deadlocked on approving a $250 billion extension of the program. The head of the Consumer Bankers Association estimates that the program will need upward of $1 trillion to satisfy demand. 

“With respect to the PPP, if an applicant’s lender hadn’t submitted the applicant’s loan documentation to the SBA as of 10:00 a.m. Thursday, then the application will not be considered due to the lapse in appropriations,” saysJack Spirakes from the SBA’s Washington Metropolitan Area District Office.

MacIsaac says she submitted her application within minutes of it going live, but she got word Thursday afternoon from Eagle Bank that they were unable to secure PPP funding from the SBA. “I know they’re completely inundated, but my business is on the line,” she says.

The SBA said it can no longer accept new EIDL loans, including the $10,000 advances, for the same reason. EIDL applications submitted before Thursday will continue to be processed on a first-come, first served basis, according to Spirakes.

While small, independent restaurants are left wondering if they still have a shot at PPP, some larger, national restaurant chains are receiving funds, which adds to the frustration. They include Potbelly Corp. and Ruth’s Hospitality Group, both of which operate restaurants in D.C.

Sandra Basanti, who co-owns Pie Shop on H Street NE, got rare good news on Wednesday. She got her $10,000 EIDL Advance loan paperwork in early enough and it was accepted. She’s pleased, even though it took three weeks instead of three days to go through. The relief couldn’t have come fast enough. She’s down to 10 percent of her usual sales by doing carry-out and delivery. “Usually we have the two food trucks, catering, bar, and music venue for covering our costs.” 

Her PPP application also appears to be making progress. She received a notification that her lender needs more information to move forward, but knows there still isn’t any guarantee that she’ll receive any money if the program runs out of available funds by the time her application is complete. 

“PPP is the most important because I want to make sure I can maintain staff at a decent wage,” she says. “I have some employees who aren’t eligible for unemployment right now. I want to stay open to keep paying people. I don’t know how long we can go on for. With no end date in sight, it’s daunting.”

Like MacIsaac and Branda, Basanti is also waiting on the city’s microgrant program. “Doing the math, the high demand from the microgrant might be a pretty small bandage at this point, which we’ll take, but it’s not really a long-lasting benefit.” 

Basanti has been in business for more than 10 years. “We’ve been involved in the community in terms of supporting other local businesses, local schools, and local musicians,” she says. “But it’s not a one business thing. The entire industry needs to be bailed out of this or there’s not going to be any survivors. You can’t single out one business being more important than others.”