President Joseph R. Biden, Jr. on March 11 signed the $1.9 trillion American Rescue Plan Act into law. The relief package includes the creation of the $28.6 billion Restaurant Revitalization Fund (RRF), a key pandemic recovery tool for the industry.

The bill’s final passage came exactly a year after the first restaurants were ordered to close due to the spread of Covid-19. The National Restaurant Association sent a plan to Congress urging the creation of an industry-specific relief program. Since then, foodservice sales have fallen $255 billion and 110,000 restaurants have closed. 

The RRF will create a new federal program for restaurant owners with 20 or fewer locations. Operators can apply for tax-free grants of up to $5 million per location, or up to $10 million for operations with multiple locations. The grant amount is determined by subtracting 2020 sales from 2019 revenue.

Funds from the grants can be spent on a wider range of expenses than previous relief programs, including mortgages or rent, utilities, supplies, food and beverage inventory, payroll and operational expenses. What’s more, $5 billion dollars of the fund will be set aside for restaurants with gross receipts under $500,000 and, for the first three weeks of the application period, the Small Business Administration will prioritize awarding grants for women-, veteran-, or socially and economically disadvantaged-owned businesses.

“These grants will inject a much-needed stimulus along the supply chain to begin to balance the economic damage done while restaurants have been struggling,” said Tom Bené, president/CEO of the National Restaurant Association in a statement. “We are still a long way from full recovery and it’s likely more grant money will be needed to get us there, but today the industry has hope for the future.”