The National Restaurant Association (NRA) sent a letter to the White House proposing several steps the administration and congress should take to provide relief for the foodservice industry in the wake of the coronavirus (COVID-19).
The proposal came just one day after President Donald Trump met with restaurant leaders, including presidents and chief executive officers of Domino’s, Yum! Brands, McDonald’s, and Wendy’s, to discuss the industry’s response to the outbreak.
The letter, dated March 18, outlined the economic headwinds leading some companies to shut down operations and lay off workers.
“Economically, we are anticipating sales to decline by $225 billion during the next three months, which will prompt the loss of between five and seven million jobs,” said Sean Kennedy, executive vice president of public affairs at the NRA. “The restaurant industry is one of low margins, tight cash flow, and a workforce that depends on us for their livelihood. Without aggressive and immediate action from the federal government, many restaurants that are a staple of local communities will simply never resume service.”
Kennedy proposed three separate categories of protection for industry restaurants and workers: directed/targeted financial relief, loans/insurance options for impacted small businesses, and tax measures.
Directed relief should include a $145 billion restaurant and foodservice industry recovery fund, established by the Department of Treasury, to help cover operations and pay employees, Kennedy said. Other proposed measures include a $35 billion community development block grant for disaster relief for hard-hit regions and assistance in allowing businesses to defer mortgage, lease, and loan obligations.
Loans and insurance protections for small businesses outlined by the NRA include $100 billion in federally backed business interruption insurance and a new federal loan program to backstop lost revenue for companies that keep workers on payroll and support sick leave requirements. The group also called for $130 million in disaster unemployment assistance.
Tax measures proposed by the group include fixing the Qualified Improvement Property (QIP) technical correction, assistance in allowing businesses to defer or delay tax obligations, tax credits for business that retain employees, and a temporary 2% reduction in employee shares of Social Security payroll taxes.
“Taken together, these proposals will ensure that restaurants have increased liquidity and access to necessary financing to help them survive the dramatic loss in profits caused by the coronavirus,” Kennedy said.
He added that the NRA will submit further proposals in the coming days as the situation continues to unfold.