Dive Brief:

• The National Restaurant Association sent a letter to the U.S. Small Business Administration on Thursday urging the agency to find funding for roughly 3,000 approved applicants whose approval for grants was revoked by the agency last week. The SBA rescinded these approvals, which were granted to operators prioritized during the program's first three weeks, after Texas and Tennessee judges issued injunctions on the disbursement of these funds.
• "We urge you to review all pandemic relief programs under your control for the prospect of any appropriate reprogramming of federal dollars to fulfill your prior commitments to them," Sean Kennedy, NRA's executive vice president of public affairs, wrote in the letter.
• The SBA didn't respond to a request for comment. In court filings last week, the agency said these operators would only receive funding once the SBA "completes processing all previously filed non-priority applications," during which time RRF funds could run dry. As of Monday, only $1.2 billion of RRF's $28.6 billion allotted funds remained. 

Dive Insight:

It's unclear what federal funding pots the SBA would be able to cherry pick from to give these once-prioritized applicants — comprised of women, veterans and socially and economically disadvantaged operators — the funding the grants they were approved for. 

The SBA said on Monday these applicants can still receive loans through the Economic Injury Diaster Loans (EIDL), Targeted Advance EIDL and Supplemental Targeted Advance EIDL programs. But these programs are offering loans, not grants, which is hardly an equivalent replacement.

Federal loans are now harder to come by, as well. The Paycheck Protection Program, which has been used as a stopgap by many restaurants during the wait for targeted federal relief, ran out of funds and stopped accepting loan applications for most lenders in May.

In late May, the NRA called on governors, mayors and state legislators to establish state-based restaurant grant funds after the RRF portal closed to help struggling operators who didn't receive approval. RRF received more than 362,000 applications totaling over $75 billion in requested funds — leaving more than $46 billion in grant requests outstanding. To fill this gap, lawmakers introduced a bill earlier this month to infuse $60 billion into RRF. The proposed legislation is endorsed by NRA, the Independent Restaurant Coalition and Republican and Democrat House and Senate lawmakers. 

In the meantime, restaurant-adjacent businesses continue to launch grant programs of their own to help keep operators afloat. Uber Eats announced Thursday that the company and nonprofit partner Local Initiatives Support Coalition has distributed $4.5 million in microgrants to 900 U.S. restaurants. More than 87% of these recipients are women or people of color.