With aid to Connecticut restaurants stalled by legal battle, Blumenthal says replenishing fund will make problem moot

Marna Evilia, owner of Sans Souci restaurant in Meriden, has been checking her email every day, waiting to hear whether federal Restaurant Revitalization Fund assistance is on its way. But disbursement of the $28.6 billion allocated for the pandemic assistance program has been stalled by legal challenges.

The fund was established as part of the American Rescue Plan and received $75 billion in funding requests nationwide before applications were shut down.

Restaurants that are owned by women, veterans and members of underserved communities were given preference and the funds were quickly exhausted. After three legal challenges objecting to the preferences, the grants have been frozen. The Small Business Administration reports that nationwide, 2,965 restaurateurs who were told they would get money have been put on hold.

But at Evilia’s restaurant Friday, Sen. Richard Blumenthal said a legal fix was in the works — replenishment of the Restaurant Revitalization Fund.

“I’m pretty optimistic. We have strong bipartisan support. The question is one of timing. I’d like to see it move quickly but we have a lot going on with the infrastructure,” Blumenthal said at a news conference at Sans Souci.

“Maybe we can move it through Congress fast because we’re replenishing an existing program. We need to raise a ruckus and push relentlessly.”

A bipartisan bill was introduced on June 10 to add $60 billion more to the fund. The Restaurant Revitalization Fund Replenishment Act of 2021 was co-sponsored by Sens. Kyrsten Sinema (D-Arizona) and Roger Wicker (R-Mississippi) and Reps. Earl Blumenauer (D-Oregon) and Brian Fitzpatrick (R- Pennsylvania).

Blumenthal said he thinks replenishing the fund will make those court actions moot and would rescind the preferences because the fund will have enough to cover all applications. Nonetheless, he added, the lawsuits “are an obstacle because they slow everything down.”

Evilia said the funding is badly needed because restaurateurs are “basically playing catch up” on deferred debts and expenses. She added that the financial relief is necessary because “I’m really not going to see a full return (to pre-pandemic revenues) until next year.”

Blumenthal said that the welcoming atmosphere of restaurants is deceiving.

“People think running a restaurant is like having a party every night,” he said. “Well, there’s a harsh economic reality behind all the good times and good humor.”

According to the National Restaurant Association, pandemic shutdowns cost the nation’s dining industry $290 billion in revenue and led to the closure of 90,000 restaurants and the loss of 1.5 million jobs.

In Connecticut, almost 80,000 of the state’s 160,000-member restaurant industry workforce lost their jobs at the height of the  coronavirus pandemic, and revenues in the $9 billion a year industry were down by about $2 million, according to Scott Dolch, executive director of Connecticut Restaurant Association. In all, more than 600 state restaurants closed, Dolch said.

Gradually, unemployment numbers are decreasing as many eateries reopen. But restaurateurs nationwide have reported that they are having trouble hiring enough staff to open at full capacity.

This further challenges an industry whose average profit margin is 4 to 6%, Dolch said.

“Everyone thinks things are fine now. That’s not the true reality,” he said.

Susan Dunne can be reached at sdunne@courant.com.