Ruth’s Hospitality Group, the parent company of Ruth’s Chris Steak House, returned its $20 million Paycheck Protection Program loan from the Small Business Administration as the company faced consumer and political pressure.
Restaurant Business says new federal guidance suggest that big publicly traded companies will need to return the funds. On Thursday, the U.S. Treasury Department published new guidelines that suggested publicly traded companies would be ineligible for the funds in the future because they could not say “in good faith” that they couldn’t access capital through other sources, and publicly traded companies that received funds need to repay them by May 7.
Shake Shack and Kura Sushi USA, which both have outlets in Las Vegas, have already said they would return the funds. Ruth’s Chris, with a steakhouse at Harrah’s Las Vegas that has been closed since Gov. Steve Sisolak ordered nonessential businesses including casinos and dine-in restaurant to shutter on March 17 to prevent the spread of COVID-19, marks the third of eight publicly traded companies that received a Paycheck Protection Program loan that said it would return the funds.
Others that received the loan include Pizza Inn operator Rave Restaurant Group, which received more than $650,000. Restaurant operator Meritage Hospitality Group, based in Grand Rapids, Michigan, with 333 restaurants across 16 states, got $29 million. Nashville-based American restaurant chain J. Alexander’s received $15 million. Potbelly Sandwich Shop, which plans to open 10 locations in the Las Vegas area, landed $10 million. Miami-based Pollo Tropical owner Fiesta Restaurant Group received $10 million.
The federal government says that publicly traded companies will not be eligible to receive funding through the new program. Both the Senate and House voted on and approved an additional coronavirus relief package, which includes $310 billion more in funding for the Paycheck Protection Program. The program ran out of the initial $349 billion in funding on April 16. The bill is expected to be signed into law by President Donald Trump on Friday.
In Nevada, 8,674 businesses received $2.01 billion of the $349 billion available in the first round of funding.
• Ruth’s Chris to Return Its PPP Loans as Feds Update the Rules [Restaurant Business]
• Kura Sushi Returns $6 Million Federal Loan Meant for Small Businesses After Public Outcry [ELA]
• More Than 8,600 Small Businesses in Nevada Received SBA Payroll Protection Loans [ELV]
• All AM Intel [ELV]
• How Coronavirus Is Affecting Las Vegas Food and Restaurants [ELV]