Restaurateurs conferred with President Trump and key members of his administration for more than an hour yesterday on the industry’s particular needs during the COVID-19 crisis, including an extension of the two-month deadline on spending federal relief loans. But they also learned the hotelier-turned-politician has his own ideas on what will propel the business back to prosperity.
Trump repeatedly brought up a restoration of the full tax write-off for business travel and entertainment meals, an issue the industry has largely shelved during the pandemic. The deduction is currently capped at 50%, and the White House has called for restoring a 100% write-off.
“I think that’ll really have a big impact,” the president said in opening the meeting, a roundtable discussion that included industry representatives ranging from a two-restaurant independent operator to the CEO Of the company that runs Burger King, Popeyes Louisiana Kitchen and Tim Hortons.
The conversation was steered back time and again to the payment time frame set under the Paycheck Protection Program (PPP), the administration’s key initiative for helping small businesses survive the pandemic. Under the plan’s current rules, loans of up to $10 million will be forgiven if a restaurant or other borrower spends the funds within eight weeks of their receipt, with 75% of the money going toward payroll.
Yesterday’s visitors to the White House pointed out that most restaurants are still closed or operating at limited capacity, so they don’t need to rehire a staff yet. They pressed for extending the spending deadline severalfold so the money could actually be used for reopening.
They invariably asked that the deadline be extended to 24 weeks.
“What’s more important, that or deductibility?” the president asked, according to a transcript released by the White House.
“That,” responded Will Guidara, operator of Eleven Madison Place and other fine-dining restaurants in New York City. “Deductibility is amazing, but it’s almost like we need to build the house first. “
“Does anybody disagree with that? Because I think deductibility is the biggest thing you can possibly do,” said Trump.
The president joked that the industry participants must have met before their White House arrivals and agreed to press in unison for a 24-week deadline. Then he asked Secretary of the Treasury Steve Mnuchin how feasible a switch from two months to six months would be for the PPP.
“Steve, does that make sense from our standpoint? What do you think?” Trump asked.
“We’re working on a technical fix that we do have bipartisan support for it to extend it,” responded Mnuchin, an architect of the PPP. “I’m not sure it’s that long. But I’ve spoken to the [Congressional Small Business Administration] committee and there is bipartisan support, so we’re working on that.”
“We’re not asking for more money,” said Tim Love, chef-operator of the Lonesome Dove Western Bistro and other one-of-a-kind restaurants in Texas. “We’re just asking the opportunity to spend it the way that you want us to spend it, the way it was intended: to take care of our employees when we’re able to open up. That’s it.”
“That should be easy, Steve, honestly,” Trump said in response.
“Yeah, we’re—we’re working on it, Mr. President,” Mnuchin replied.
The chief executive said he was surprised the industry representatives were so focused and united on extending the PPP expenditure deadline. “I’m surprised that’s all they asked for,” Trump said during an impromptu press conference that followed the roundtable. “I think what they’re asking for is very reasonable, Steve. We’re going to have to go and get it approved.
“We’ve saved and we’ll continue to save the restaurant business,” Trump continued. “And ultimately we’ll be paid back many, many times, because they pay a lot of taxes, you know?”
Also participating in the roundtable were Tilman Fertitta, CEO of Landry’s and someone Trump acknowledged as a friend; Thomas Keller, chef-operator of The French Laundry and Per Se; Melvin Rodrigue, CEO of Galatoire’s in New Orleans and the current chairman of the National Restaurant Association; Marvin Irby, acting CEO of the National Restaurant Association; Jose Cil, CEO of Burger King and Popeyes parent Restaurant Brands International; Niren Chaudhary, CEO of Panera Bread; Sean Feeney, an operator of two Brooklyn independents; and James Bodenstedt, CEO of Muy Cos., a 765-unit restaurant franchisee.
Representing the White House, in addition to Trump and Mnuchin, were Vice President Mike Pence, Secretary of Labor Eugene Scalia, National Economic Council Director Larry Kudlow and Trump’s daughter Ivanka.