While the new $350 billion Paycheck Protection Program is aimed at businesses with 500 or fewer employees, language in the $2 trillion federal stimulus bill allows big restaurant and hotel chains to participate regardless of how many people they employ, the Wall Street Journal reported. Sean Kennedy, executive vice president for the National Restaurant Association, which lobbied for the restaurant-and-hotel exception, says that size shouldn’t matter. “The restaurant industry is uniquely affected by this pandemic,” he said. “It was the first industry shut down. We think we deserve a unique response from the federal government.” But John Lettieri, president of the Economic Innovation Group, a Washington, D.C., think tank, says big companies should rely more on their own resources or other federal stimulus programs. The small-business-loan program is “the only lifeline we’re offering to these classes of businesses,” he said. “It stretches the intent of statute beyond recognition to apply it to national entities.” Some smaller franchisees worry that the big firms could elbow them out for loans if the fund gets depleted. Trump administration officials have said that they would seek additional funding if the money runs out. Congressional support is likely, said an aide to Sen. Marco Rubio, the Florida Republican who chairs the Senate Committee on Small Business and Entrepreneurship. The loans are made by banks, credit unions and other lenders and have a 1% interest rate. They are designed to keep employees on the payrolls for eight weeks. If a borrower doesn’t lay off workers, the government plans to forgive the loan, including interest. Borrowers may also use the money for rent and utilities. The maximum loan is $10 million. In addition to the exemption for hotel and restaurant chains, a second exemption was granted for franchise owners in any line of business who employ more than 500 people, as long as no single outlet employs that many.
