El Granero restaurant, located in Miami Lakes, opened its doors to the public in November 2019. Now, the business is struggling to keep paying its expenses.
The reason: it’s not eligible for the federal Paycheck Protection Program because it opened too recently, according to the owner, Carlos Romero. There are criteria small businesses must meet before receiving a loan. In this case, the restaurant has not yet filed a qualifying tax return, which is why it is ineligible.
Romero does not know how much longer the place will be able to stay open without financial assistance.
“Since we are a business that just opened, we have many expenses,” Romero said. “Our plan was to pay taxes these months, but the pandemic arrived. Now, we have not contributed to the state [so] we cannot apply for the Paycheck Protection Program loan.”
The COVID-19 outbreak had its most dramatic effect when on-premises dining was prohibited. Then on March 27, President Donald Trump signed into law the CARES Act, which contained $376 billion in relief for American workers and small businesses. Now, questions remain about whether new businesses are eligible to receive that financial help.
“In the case of this business. . . everything stopped,” said Joseph Duarte, El Granero’s accountant. “One of the things that was more difficult is that the platform. . . did not allow explanations or waivers and automatically made the business ineligible.”
The Paycheck Protection Program is administered by the federal Small Business Administration, which provides financial relief to small businesses if they meet the program’s requirements — like filling out 2019 taxes.
“One of the characteristics of the Paycheck Protection Program is that it is much better than other loans because it starts as a loan, but if it is used to pay employees, then it would give the business forgiveness of that debt,” Duarte said.
There is a great deal of uncertainty about what is going to happen to restaurants. Though they have been allowed to open dining rooms, numbers of patrons are limited. The most vulnerable businesses and workers during this crisis are retail trades (10 percent) and food services (6 percent), which represent nearly 26 million American workers, according to Pew Research Center.
“Until now, we have only had to cut the hours of our employees,” Romero said. “We have not lowered their salary, but payroll has been complicated since the restaurant does not receive the same earnings,” Romero said.
Employees of El Granero agree that this is a critical situation and with no financial assistance for a small business like this, the future is unknown.
“We are still working, our shift hours have been reduced, and we hope this situation settles down a little bit,” said Mariela Vasquez, a restaurant employee. “But we know that the owners are doing the best they can to keep the restaurant open.
Despite the uncertainty of this crisis, restaurant owners claim the best way to deal with the problem is to have plans to help keep their business open.
“So far we are trying to find options to apply to any other programs which can help us during this crisis,” Romero said.