The window is closing for a $28.6 billion pot of money offered by the federal government to prop up restaurants and bars as they recover from the COVID-19 pandemic.

Federal officials estimate that just over 101,000 restaurants received aid from the Restaurant Revitalization Fund, while another 278,000 had asked for what would have amounted to a combined $72.2 billion from the Biden administration. – more than twice the amount of funding available for the program.

But less than half of the New Jersey pandemic-hit bars and restaurants that asked for monetary aid under a federal COVID-19 relief program actually got any help, a problem plaguing the program nationwide.

Figures published by the U.S. Small Business Administration, which oversees this $28.6 billion pot of funds known as the Restaurant Revitalization Fund, showed that 3,086 businesses were approved, out of 7,792 eateries that applied for funding.

All told, their payments totaled nearly $924 million, and the Biden administration would have needed $2.26 billion to grant every request in the state.

A letter sent to those restaurant owners shut out of federal funding said they could not be approved for government aid because of “overwhelming demand,” and that they would have to wait for further appropriations from Congress. Access to the online platform will be cut off on July 14, according to the federal Small Business Administration, which oversees the program.

“For 100,000 restaurants, the R.R.F. has made their future clear and stable, but for the more than 200,000 operators shut out of funding, receiving this letter today only heightens their fear and anger,” reads a recent statement from Sean Kennedy, a spokesperson for the National Restaurant Association, a trade group.

A variety of such proposals are floating in Congress that would tack on more federal aid for restaurant relief.

The COVID-19 pandemic devastated bars and restaurants, with government-mandated restrictions keeping them shut down entirely, save for take-out and delivery. They were able to eventually reopen in New Jersey for outdoor dining only, and then reduced capacity for indoor dining beginning in the fall of 2020.

As among the first to close in this pandemic and likely the last to reopen, many are still struggling to survive.
– SBA Administrator Isabel Guzman.

For an industry that depends on packed rooms in order for an establishment to do well, the closures and restrictions were particularly devastating.

“As among the first to close in this pandemic and likely the last to reopen, many are still struggling to survive,” reads a July 6 statement from SBA Administrator Isabel Guzman.

Of particular confusion and controversy was the SBA’s decision to pull back grant awards given to 2,965 women- and minority-owned businesses, after a federal court said the agency’s 21-day prioritization of those applicants was considered racial discrimination.

“The acceptance letter they received from the SBA represented a commitment to provide not only federal funding but also a needed bit of hope that they would survive to serve their community,” Kennedy said in a separate statement. “The announcement that their grants will be awarded to others has left them confused, frustrated, and afraid they will have to close their doors for good.”

State efforts have been rolled out by the Murphy administration over the past 15 months to support COVID-hit restaurants.

Gov. Phil Murphy in late June approved $20 million of COVID-relief grants for bars and restaurants and $10 million for the “Sustain and Serve NJ” program – which effectively pays restaurants to prepare meals for some of the state’s most in-need residents – out of a $235 million round of state funding.

The state agency is in the midst of an $85 million round of grant funding to help businesses stay afloat. And the state budget Murphy approved last month includes $135 million of direct business relief.

Murphy estimated that his administration has given out more than $600 million in grants, low-interest loans and other forms of assistance since the COVID-19 closures first went into effect in March 2020.

Under another federal program, the Paycheck Protection Program, the SBA approved 157,405 forgivable loans totaling $17.3 billion in 2020, and in 2021 approved 134,362 loans totaling roughly $8 billion.

Many restaurants have found themselves struggling to kick off their COVID-19 recovery and the start of the summer season, with many workers previously in the industry refusing to apply for open jobs.

Editor’s Note: This article was updated on July 7, 2021 at 1:35 p.m. EST to add the total payments from the U.S. Small Business Administration to restaurants.