IFA & Co-Signers Push the SBA To Expand the EIDL Program
The IFA, in partnership with a coalition of industry trade associations representing expansive segments of the U.S. hospitality industry, has issued a joint letter to SBA Administrator Isabella Guzman. The letter urges swift adoption of proposed improvements for the new Covid-19 Economic Injury Disaster Loan (EIDL) program, which provides economic relief to small businesses and nonprofit organizations currently experiencing a temporary loss of revenue amid the pandemic.
Co-signers include the American Hotel & Lodging Association; Asian American Hotel Owners Association; National Restaurant Association; International Health, Racquet & Sportsclub Association; and the Coalition of Franchisee Associations.
The letter requests the following key improvements to the EIDL program that will be crucial for franchise and small-business economic recovery:
- Increase the individual loan cap for small businesses to $2 million, a desperately needed increase from the current $500,000 cap.
- Ensure the EIDL affiliation rules mirror those of the Paycheck Protection Program (PPP) to allow multi-unit operators, particularly franchisees, to equitably access the program.
The Covid-19 pandemic has had a debilitating impact on the hospitality industry and small businesses in the U.S. Our data shows the following:
- Within the first 6 months of the outbreak, an estimated 32,700 franchised businesses had closed; 21,834 businesses were closed temporarily, and 10,875 were closed permanently.
- Before the pandemic, hotels in the U.S. employed more than 2.3 million people. In 2020, hotels lost more than 700,000 jobs and are expected to remain down 500,000 jobs in 2021. Hotels will lose $59 billion in business travel revenue alone this year, putting many at risk of closure.
- The restaurant and foodservice industry is still reeling from $300 billion in lost revenue, which has led to 1 million lost jobs and 90,000 restaurants closed permanently or long term.
- Fitness club closures in the U.S. totaled 22% since March 2020, resulting in nearly $30 billion in lost revenue. The industry lost 1.5 million jobs, amounting to nearly 50 percent of the entire workforce.
Matt Haller, IFA President and CEO released the following statement:
“The EIDL program is the last federal Covid-19 economic relief option that can save struggling small businesses from closure. As new Covid-19 variants emerge and we once again face an uncertain future, the franchise community desperately needs these proposed changes adopted by the SBA. We eagerly look forward to working with SBA Administrator Isabella Casillas Guzman and her team on future pandemic recovery initiatives.”
For additional information, contact Tom Shaw at email@example.com or 856-625-6640.
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