Senate approves more funding for PPP, but Maryland restaurant owners say program misses the mark

Phil Han closed down half of his Baltimore businesses: Bon Fresco, an Inner Harbor eatery that caters to the downtown lunch crowd, and two stalls in the Broadway Market. Only Dooby’s, which opened in 2013, and Noona’s remain, both with limited hours.

Though he’s been negotiating reduced rent with landlords and applying for various grants and government aid, Han isn’t sure how long it will be before he has to shut down permanently.


“If we don’t see any aid coming in, it’s really a waiting game,” Han said.

While the coronavirus has hammered the national economy, restaurant owners and advocates say the virus has hit their industry harder than any other sector. About 40% of U.S. restaurants are closed — including about 4,500 businesses in Maryland, with 150,000 workers laid off, according to a recent survey from the National Restaurant Association.


The $2 trillion coronavirus aid package passed by Congress included a $349 billion loan program designed to help small businesses keep paying employees, but all of that money is already gone and only 9% of approved loans went to hotels and restaurants, according to the Small Business Association. On Tuesday, the U.S. Senate passed an additional $310 billion of funding for the Paycheck Protection Program.

But few restaurant owners, the restaurant association survey says, think the loan program can work for them.

“We are the fabric of every community. We make up every little city across the state of Maryland,” said Brian Bolter, a former news anchor who closed down his four restaurants in Annapolis and Ocean City to comply with Gov. Larry Hogan’s executive order. And yet, he said, “there’s very little help.”

Bolter has joined a group called the Independent Restaurant Coalition in urging lawmakers to change the terms of the loan to allow restaurant owners to spend the money after they are legally allowed to reopen.

As currently written the loans offered through the program need to be spent before June 30, said Marshall Weston, president and CEO at the Restaurant Association of Maryland. He thinks restaurants need more time, perhaps through the end of the year, to spend the money since it’s not clear they’ll even be allowed to reopen by the summer.

“I don’t think that anyone can say with confidence that restaurants are going to be able to fully reopen anytime soon,” he said. “The June 30th deadline does not work for our industry.”

Instead, he said, employees should be brought back slowly as restaurants ramp up business.

That reasoning is part of why Bolter opted not to apply for loans through the federal program. It wouldn’t make sense to bring back laid off employees right away, since the businesses are closed and the 95 staffers who typically work during the busy season may remain concerned about contracting coronavirus on the job.

“It forces them back to the workplace,” Han said of his workers.

Han called it a “Catch-22.” Many of the 60 workers he laid off at his restaurants receive more money through unemployment, with an extra $600 per week from the federal government, than he would be able to pay them.

That’s a sentiment shared across the industry.

“Most owners feel very uncomfortable with that scenario,” Weston said.


Still, Han opted to apply for the federal loan. He hasn’t gotten any money from the program and doesn’t know a restaurateur who has, aside from big chains like Ruth’s Chris Steak House and Potbelly Sandwich Shop. Both received millions.

In Annapolis, Bolter gave up a brief attempt at carryout after realizing he was spending more money to stay open than he was making in sales. With no revenue coming in, he and his wife are pouring their savings into the business.

“We are just watching the drip, drip, drip of our bank accounts,” he said.

Questions remain about what dining out will look like once the pandemic is over. Will dining rooms be half full, tables spaced out six feet apart? After such a dire recession, who will be able to afford to eat out?

“I don’t think anyone believes that restaurants are going to magically become packed and full," Weston said.

While at home with his wife, two young sons and dog, Han has wondered how to reconfigure places like Bon Fresco should workers stop coming into offices.

He’s already made changes at Noona’s. Open just one day a week, the pizzeria sells CSA boxes and lasagnas to the surrounding Bolton Hill community under quarantine.

“When we reopen we want to be prepared for a different landscape,” he said.

Recommended on Baltimore Sun