Pollo Tropical, which employs Florida congresswoman’s husband, gets small biz loan

This story has been updated to reflect additional information.

The publicly-traded parent company of Miami restaurant chain Pollo Tropical — which employs the husband of Democratic Rep. Debbie Mucarsel-Powell as an executive — received two taxpayer-funded loans totaling $15 million intended for small businesses affected by the coronavirus pandemic.

Fiesta Restaurant Group Inc., with more than 10,000 employees, was granted a $10 million Paycheck Protection Program loan on April 8, money that does not have to be paid back if it is used to keep employees on the job, according to a Securities and Exchange Commission filing. A second, $5 million loan was granted on April 17.

In a corporate filing Thursday evening, Fiesta said it is “currently reviewing” the money to determine whether it’s appropriate to keep it in light of new Treasury Department guidelines released Thursday that will prevent most publicly-owned large companies from receiving loans.

Mucarsel-Powell, a Miami congresswoman who supported two bills that sent a combined $659 billion to the coronavirus relief program known as PPP, has said she’s opposed to large, publicly-traded companies — like Fiesta — receiving the government money.

A separate, $500 billion pot of money has been set aside for large corporations affected by the coronavirus.

On Thursday, Mucarsel-Powell’s staff tried to cast the law as flawed because it allows big businesses to compete for the small-business-loans, something they said Republicans put in the emergency-relief bill.

“Congresswoman Mucarsel-Powell disagrees with the language that Republicans insisted be included in the law that allows larger companies to receive aid intended for smaller businesses,” Mucarsel-Powell chief of staff Carlos Paz said in a statement.

Republicans criticized Mucarsel-Powell on Tuesday, with a Republican National Committee spokeswoman saying the congresswoman was allowing her husband’s company to “swindle” money from the government fund. Mucarsel-Powell is running for re-election in November and will likely face Republican Miami-Dade Mayor Carlos Gimenez.

There’s no indication Powell played a role in Fiesta’s PPP loan application.

Robert Powell, Mucarsel-Powell’s husband, works as a vice president for legal at Fiesta Group, according to his LinkedIn profile. Florida Politics first reported on Powell’s Fiesta work, which began in August 2018.

It’s not the first time that family members for Mucarsel-Powell and Gimenez have been the subject of political attacks.

Powell previously worked as general counsel for companies owned at least in part by Igor Kolomoisky, a wealthy Ukrainian businessman accused of contract killings and embezzlement, work that Republicans also attacked during Mucarsel-Powell’s 2018 campaign against then-Rep. Carlos Curbelo.

Democrats have attacked Gimenez for his family’s work, including his son’s lobbying on behalf of Donald Trump’s efforts to take private control of a county-owned golf course in Key Biscayne in 2014.

Powell did not respond to a request for comments.

Fiesta Restaurant Group, which is based in Dallas and also owns the Texas-based chain Taco Cabana, said in its Thursday filing it will use the loans, if it keeps them, “solely for payroll costs and related benefits for the period, including recently implemented salary increases for hourly shift associates.”

The filing also indicated that the base salary of Fiesta executives has been reduced by 20-35% beginning April 24 and the board of directors will not accept retainer fees for the next fiscal quarter.

“The company expects to use a portion of the proceeds available as a result of the board of directors and executive reductions to fund programs benefiting the Pollo Tropical and Taco Cabana restaurant team members,” the filing said.

Pollo Tropical restaurants throughout South Florida remain open for drive-thru and carryout orders.

The PPP loans were intended to go to businesses that employ fewer than 500 people, but a loophole in the initial version of the legislation allows companies with different locations like restaurant chains that each employ fewer than 500 people to apply for the loan. At least two beneficiaries of that loophole, the burger chain Shake Shack and Ruth’s Chris Steakhouse, announced they will return their PPP loans.

A full list of PPP recipients has not been made public, but publicly-traded companies were required to report the loans on corporate filings. The Associated Press identified 94 publicly traded companies that received PPP loans, including Fiesta and the Hyatt Regency Coral Gables.

Fiesta applied for its PPP loan through JP Morgan Chase Bank, which helped nearly all of its private and commercial banking clients who applied for a PPP loan get one. But only one out of every 15 retail banking customers who sought loans with Chase were successful, according to The New York Times.

Florida Republican Sen. Marco Rubio, who helped craft the PPP program as chairman of the Senate Small Business Committee, said the Treasury Department will issue new guidance clarifying that a public company like Fiesta with a market value of $189 million will not be eligible for the program.

“Today, Treasury will clarify that it’s unlikely a public company with substantial market value & access to capital markets will be able to make required #PPP certification in good faith,” Rubio tweeted Thursday. “They have until 7 May to repay a #PPPloan without penalty.”

Paz said Mucarsel-Powell expects all companies to follow the new Treasury Department guidelines: “With reports today that the Trump administration will now offer new guidance to limit larger businesses’ access to this relief fund, guidance she has advocated for, she expects all companies to follow the letter and spirit of the law.”

Florida Republican Sen. Rick Scott has proposed a number of changes to the PPP program, including a requirement that banks process applications on a first-come, first-served basis and requiring applicants to show that business has dried up due to the ongoing pandemic.

“You know what small businesses didn’t get a loan under the PPP? Your local coffee shop, florist, hairdresser or mom-and-pop hardware store,” Scott wrote in a Fox News op-ed. “After the well-connected businesses with long-standing financial relationships with the banks got their forgivable loans, the program ran out of money.”