Tom Colicchio, the public face of the fight to save independent restaurants from the earliest days of the pandemic, took his rage to social media after Congress refused to approve another aid package to help his industry this month.
But the celebrity chef’s ire was not directed at any particular politician. Instead, responding to a tweet from the National Restaurant Association, he wrote: “Thanks for nothing, as an organization you have worked against funding for independent restaurants.”
Suddenly, a long-simmering dispute between the industry's largest advocacy group and the upstart grassroots organization Colicchio helped start, the Independent Restaurant Coalition (IRC), was there for all to see.
But the snipe was more than just fuel for inside-baseball gossip about the "Top Chef" judge's prickliness. Beltway insiders say it's strong evidence of the political infighting that may have undercut the resurrection of the Restaurant Revitalization Fund (RRF).
And though the parties have their differences, they both agree the failure will mean tens of thousands of restaurant closures in the days and months to come.
Chains vs. independents
The no-go on additional aid capped two years of strain between two groups that were ironically pushing for the same thing from Washington, D.C., at least by 2022. But chances of a tighter collaboration between the National Restaurant Association and the Independent Restaurant Coalition were hampered by a tug-of-war over which truly spoke for the mom-and-pop operators who suffered most during the pandemic, several people told Restaurant Business.
The association maintained that it has always been the voice of the whole industry and the entity recognized by Washington as the proxy for the business. (The association is also the majority owner of RB, but was not invited to preview or shape this story.)
The IRC has all but laughed at the assertion, blasting the larger group as the lapdog of big restaurant chains, not a champion of the small one-of-a-kinds who endear the industry to Americans.
“These are the neighborhood restaurants that never really had a dedicated voice in Washington,” Colicchio said during an IRC press call early this month. (He did not respond to requests to be interviewed for this story.) “That’s why we started the Independent Restaurant Coalition.”
Founding members said they needed to promote their interests as the pandemic took hold because the National Restaurant Association was doing nothing for the small operator.
Erika Polmar, IRC executive director, said independent restaurants had no forceful advocate until her group formed on March 18, 2020, with 18 chefs and restaurant owners gathering on a Zoom call in the pandemic’s earliest days.
“The biggest misstep is that independent restaurants and bars did not have a collaborated effort in the past,” Polmar said. “Had we been well-established before, this task would’ve been easier. This is a community of people that always stepped up quickly to help others.”
Polmar has hosted a farm dinner series in Oregon for nearly two decades and has long been known as an advocate for small farmers and others. She served as an IRC volunteer for the first several months of the group's life before being brought on as a paid staff member—its only one.
“This association is representing brewers and distillers and franchisees and independent restaurants and food trucks,” Polmar said of the National Restaurant Association. “I don’t know that there’s one organization that could ever speak for all those folks. We all have our own business models. Could one association speak for all those entities? I think that’d be pretty tough.”
Chef David Nayfeld of San Francisco serves on the IRC’s board and was on some of the group’s earliest planning calls.
“It became very clear to us very early on that, really, there was no one speaking on our behalf,” Nayfeld said. “I naively thought that the restaurant association spoke for all restaurants. But I would say what I’ve seen over the past two years has been contrary to that.
“I’m not saying they’re bad for that. I’m saying they’re a different group than we are. I don’t think they’re a bad organization.”
But IRC members are largely restaurant operators and chefs—not lobbyists. So, they had minimal experience in the political sphere.
Instead of hearing one clear ask from an industry representing more than 12 million voters, lawmakers were hit with differing assertions of what was needed to sustain the industry’s workforce, the private-sector’s second largest. The groups didn’t even agree at times on how much aid was needed.
No one knows how much the strife may have hurt the industry’s chances of getting a re-up of the RRF. In the chaotic days leading up to the federal spending package being finalized, congressmen and senators were getting requests and arguments from a slew of parties. Instead of hearing one voice from the industry, they often heard two.
Beltway veterans say the industry’s cause wasn’t helped by the IRC’s lack of lobbying prowess. When the initial drive to create the RRF was underway in 2021, forward progress was halted by the sort of setback that’s routine for a legislative measure of significance. Instead of finding a way around the roadblock, as a seasoned lobbyist would know to do, IRC’s leaders blasted the lawmakers responsible for the delays, some inside the discussions said.
It was a classic rookie mistake, said one of the two sources who separately recounted the situation to Restaurant Business. Both explained it’s a given in Washington that today’s enemy is tomorrow’s ally, so open personal attacks are rare and regarded as foolhardy.
The criticism indeed rankled the lawmakers. According to both of RB’s sources, Sean Kennedy, EVP of public affairs for the National Restaurant Association, had to personally smooth the lawmakers’ feathers and re-enlist support to get the RRF measure moving forward again.
The IRC denied any sort of contentious relationship with lawmakers during the process.
“It’s never been adversarial,” Polmar said. “The IRC has enjoyed the great privilege of educating our lawmakers on how our industry works. … We’ve developed a whole network of champions.”
The association, for its part, has not publicly spoken ill of the IRC or indicated a refusal to work with the group. The IRC said it is not currently working with the association, nor does it have plans to, with Polmar noting that her group is “a completely independent trade association.”
“We would much rather work with them,” Lance Trenary, CEO of Golden Corral and this year’s association chairman, said during an interview about his plans for the year. “I don’t quite understand why we can’t all be part of the same force. We are all so much stronger if we all raise our voice for the same thing.”
Plus, it’s inaccurate to say the groups aren’t working together, according to Kennedy. Many of the IRC’s members also belong to state restaurant associations, all of which are affiliated with the national group.
“We will continue to work with their members through our state partners,” Kennedy said. “As for their leadership, I don’t always understand or agree with their statements.”
How the rift started
Association officials declined to parse how the two groups ended up at odds. But a piecing together of the early comments and actions of both parties suggests they differed from the start on what help to seek from the federal government.
The association took more of a scattergun approach, pushing for aid in any form. That included supporting creation of the Paycheck Protection Program (PPP), an initiative that channeled low-interest and potentially forgivable loans to any operation with more than one location and fewer than 500 people on its payroll.
Reports emerged of larger operations like Ruth’s Chris and Potbelly qualifying for loans.
The NRA said its plan to help the industry had included measures right from the start that would help independents, including a pool of direct aid.
The IRC pushed hard for the creation of a Restaurant Fund that would specifically help independents. It asked for about $100 billion in direct aid, compared with the association’s ask of $224 billion in federal assistance for the industry as a whole.
The association also pushed for such broad-based forms of assistance as the Employee Retention Tax Credit, a tax cut of $50,000 per employee provided as an advance against an employer’s next income tax filing. The IRC stuck with its focus on independents and the creation of a fund specifically for that sector of the business.
By all accounts, both groups continued to hammer Congress and the White House for more restaurant aid, though with differing proposals on the amount and who’d share in the assistance.
They succeeded with the creation of the RRF in early 2021 by Congress and the Biden administration. The program channeled $28.6 billion in direct grants to restaurants with fewer than 20 branches. Instead of jointly celebrating the victory, the IRC claimed credit for the program.
“The RRF was born out of the Restaurants Act,” Polmar said. “And that came from a white paper, essentially, that IRC worked on, which was also supported by tons of research and was originally drafted to support independent restaurants and bars. I feel quite confident in saying we were quite instrumental in making that happen.”
She added: “The NRA has certainly done their share of advocacy. This isn’t a competition. It’s about getting support for independent restaurants and bars.”
The RRF proved a lifeline for restaurants that secured one of the grants, but it ran out of money within 20 days, leaving 177,000 applicants with nothing. Only about a third of the struggling restaurants that applied received funding. Separately but in parallel, the groups sought a reallocation from Congress but were thwarted when lawmakers failed to include a re-up in a last-minute allocation package.
Now, both groups are looking for a way of securing more aid money, though apparently via paths that do not cross.
It remains to be seen if the division will persist as other matters of key importance to the industry should arise in Congress or in statehouses.
What comes next?
One of Trenary’s priorities for his yearlong tenure as chairman is dispelling the notion that the association serves one sector over another. “That’s one thing that’s really important to me this year, that that message is well-defined and communicated throughout our industry,” he said. “We’re the voice of the whole industry.”
He stressed that assertions of a bias toward chains doesn’t match the facts. His four predecessors as chairman all run independent restaurants.
Trenary also pointed out that only 27% of the association’s extensive board of directors, a 60-plus-person advisory group recruited to reflect the membership, are chain operators.
The wild card could be the arrival of a new CEO of the association. Michelle Korsmo will move over from the Wine & Spirits Wholesalers of America to take the top staff position at the group on May 1.
Colicchio and the other leaders of the IRC are currently working with U.S. Rep. Earl Blumenauer, D-Ore., onthe inclusion of an independent relief package in any COVID aid measure that Congress may consider.
It’s unclear what other industry issues might draw the organization’s support. In the past, Colicchio has participated in events presented by Restaurant Opportunities Center, the union-affiliated group that’s pushed for such measures as a discontinuation of the tip credit and higher wages for restaurant employees.
Nayfeld said the IRC may focus on advocacy around immigration or farming or another “creative way” of getting money back in the hands of restaurants, though tax rebates or other measures.
“Our goal is now to fight for things that we believe will make independent restaurants stronger and more resilient and ultimately better businesses,” he said.
One thing is clear, though, at least according to the IRC: Independent restaurants will be louder advocates for themselves going forward.
The IRC has more than 120,000 “supporters,” including restaurant owners, employees and suppliers, who’ve worked since the pandemic began to push for aid, a spokesperson for the group said, adding that the IRC will not comment on its paid membership ranks.
Since the pandemic began, regional independent restaurant advocacy groups have formed in Idaho, Milwaukee, Oregon, Los Angeles, Massachusetts, New York and other areas.
“Through this pandemic, we’ve not let this crisis go to waste and we’re coming together,” said Katie Baker, executive director of FARE Idaho advocacy group.
“Independents are just that; we’re independent. But I have seen a real sense of community. … We figured out through the pandemic that we don’t need to work alone and we don’t need to be as independent as what we thought.”