You Received Restaurant Revitalization
Fund Money – Now What?
by Ben Hancock, CPA
You applied for a Restaurant Revitalization Fund (RRF) grant and received your funding. Now what? While this is an exciting moment, you’re not quite to the finish line. There are specific requirements on how you can spend your funds and a few follow-up compliance items you’ll need to complete.
What Can You Spend the Funds On?
Eligible expenses must be business-related and include things like:
- Business payroll costs (including sick leave)
- Business utility payments
- Business maintenance expenses
- Business supplies (including protective equipment and cleaning materials)
- Business food and beverage expenses (including raw materials)
- Covered supplier costs
- Business operating expenses (insurance, fees, marketing, licenses, legal, POS equipment, etc.)
- Construction of outdoor seating
- Payments on any business mortgage obligation (both principal and interest) - this does not include any prepayment of principal or interest
- Business debt service (both principal and interest) - this does not include any prepayment of principal or interest
What Can’t You Spend the Funds On?
The Small Business Administration (SBA) has specifically commented that restaurants can’t use funds on business expansion. For example, you could renovate a damaged food truck. However, it wouldn’t be acceptable to purchase an additional food truck to add to your existing fleet. Similarly, a restaurant can expand their outdoor dining area, but can’t use the RRF money to help pay for construction of a new restaurant at a different location. Restaurants also can’t prepay principal or interest on debt.
When Do You Need to Spend the Funds?
The funds must be spent on expenses that were/are incurred between February 15, 2020 and March 11, 2023. If you have any unused funds at the end of the covered period, they will need to be returned. Keep in mind, if your business was to close permanently, the covered period automatically ends, and you are required to return all unused funds at that time.
Use of Funds Reporting Requirements
Recipients must track the use of RRF grant funds in order to self-report unaudited data detailing the use of distributed funds because the SBA reserves the right to request supplemental documentation needed to validate the funding.
If the RRF award proceeds are fully expended before 12/31/21, recipients will be asked to complete a Use of Funds Assessment to certify in the application portal that proceeds have been used on eligible expenses and provide a detailed expenditure report and certification for the required period.
If the RRF award proceeds are not fully expended award funds before 12/31/21, recipients will be required to complete annual reporting submissions until they fully expend the award funding, or the period of performance expires.
We Can Help
Receiving a grant from the RRF is incredibly exciting, but can come with many questions. Our team can help you work through how to appropriately spend your funds and ensure you’re in compliance with the program.
Call us at (360) 734-4280 or fill out the form below and we'll contact you to discuss your specific situation.
Ben Hancock, CPA
Ben Hancock joined Larson Gross in 2020. He specializes in financial statement audits, single audits and internal control risk assessments for nonprofit organizations and businesses across industries.