SBA administrator separates PPP facts from myths
SBA Administrator Jovita Carranza on the Paycheck Protection Program, separating facts from myths.
The French Laundry, the posh California restaurant where Gov. Gavin Newsom was spotted dining with friends and lobbyists one month ago, received more than $2.4 million in taxpayer-funded loans through the Paycheck Protection Program, government filings show.
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The Michelin-star restaurant in the Bay Area received two loans, both approved on April 30, according to the latest data from the Small Business Administration (SBA). One loan, worth more than $2.24 million, was used to keep 163 employees on the payroll. The second, for $194,657, was used to retain five employees.
AT LEAST 4 MEMBERS OF CONGRESS BENEFITED PERSONALLY FROM PPP LOANS
The restaurant did not respond to a FOX Business request for comment.
Congress created the $670 billion rescue fund with the passage of the March CARE Act in order to staunch the economic pain of the coronavirus pandemic and help small businesses avert mass layoffs. The federal government will forgive the loans if at least 60% of the money goes toward maintaining payroll.
The French Laundry – which was opened by celebrity chef Thomas Keller in 1994 with the help of 60 investors – offers an exclusive outdoor culinary dining experience beginning at $450 per person, and features a white truffle and caviar dinner for $1,200 per person, according to online reservation services.
GAVIN NEWSOM'S CONTROVERSIAL FRENCH LAUNDRY MEAL BEGS QUESTION: HOW MUCH DID IT COST?
The restaurant was also the site of a recent controversy after photos emerged of Newsom, California's Democratic governor, attending a birthday party and sitting at a round table for 12 in a dining room enclosed on three sides and covered. Newsom, who has maintained that the event was outdoors, nonetheless drew flak for seemingly violating his own strict coronavirus lockdown rules.
According to ABC7 News, which first reported the story, the money the French Laundry received was 17 times more than what the average Bay Area restaurant received, prompting a backlash from other business owners.
"I'm angry, but what can I do about it?" Dennis Berkowitz, the former owner of San Mateo restaurant Vault 164, told ABC7. Berkowitz said he struggled to receive a $318,000 loan used to retain about 50 employees. But the loan was not enough to keep his business afloat, and he was forced to sell the restaurant in July, he said.
SAN FRANCISCO MAYOR ATTENDED FRENCH LAUNDRY PARTY NIGHT AFTER GAVIN NEWSOM
At the onset, the program was heavily criticized for granting aid to publicly traded companies that had other avenues for relief – even as small businesses languished. The SBA and Treasury Department, which jointly administered the program, scrambled to close the loopholes that allowed multimillion-dollar companies to tap the fund, including pledging to audit any loan worth more than $2 million.
Over the course of roughly four months, the PPP distributed about $525 billion in forgivable loans to 5.2 million companies, saving an estimated 50 million jobs, according to the SBA. The program was closed to new applicants at the end of July, although there's still roughly $38 billion remaining in the fund.
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Lawmakers have been trying to negotiate another round of emergency aid for months, to no avail. But congressional leaders appeared to near a $900 billion relief deal on Wednesday that would include additional funding for the PPP, as well as boosted unemployment benefits and funding for vaccine distribution, education and health care.
"We made major headway for hammering out a targeted relief package," Senate Majority Leader Mitch McConnell, R-Ky., said Wednesday.
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