Bipartisan Bill Would Reimburse NJ Eateries for 'False Openings'

NEW JERSEY - A bipartisan piece of legislation to reimburse restaurants, bars and caterers that spent money on supplies in preparation for indoor dining’s return only to have that authorization rescinded was introduced in the Senate Tuesday.

The bill would reimburse restaurants, bars and caterers that spent money on supplies in preparation for indoor dining’s return only to have that authorization rescinded was introduced by Senate President Steve Sweeney, Sen. Vin Gopal, and Sen. Anthony Bucco, the sponsors of the bill.

The funds for reimbursement would come by appropriating $30 million to the Economic Development Authority from federal block grants allocated to the state from the CARES Act. The EDA would then provide direct financial support, by way of loans or grants, according to the bill.

“Many restaurant owners had already spent money they didn’t have, often on personal credit cards, to buy food, obtain PPE for staff, and renovate their dining rooms to serve customers safely,” said Senator Bucco. “They incurred unnecessary losses through no fault of their own, in compliance with the governor’s orders, and deserve to be compensated through the $2 billion in federal financial aid that remains unspent by the State.”

Restaurants were set to reopen for indoor dining on July 2, but the authorization to return to business was later reversed by Gov. Phil Murphy.

"We had planned to loosen restrictions this week," Murphy said during a COVID-19 briefing last month. "However, after COVID-19 spikes in other states driven by, in part, the return of indoor dining, we have decided to postpone indoor dining indefinitely."

At the time, Murphy said he expected the delay to be a matter of weeks.

"We have enormous sympathy but the alternative here is worse and unacceptable,” he said.

After the delay, many restaurant owners said that they were out thousands of dollars due to the change.

“This false start severely affected the food establishments that hired additional staff and spent money on equipment in anticipation of reopening,” Sweeney said. “These businesses are among the hardest hurt by the pandemic and they are at risk of permanently going out of business. This will help reimburse the restaurants, bars and catering businesses that have followed the rules to protect the public’s health but are now paying the price.”

President of the NJ Restaurant and Hospitality Association Marilou Halvorsen said that restaurants have been devastated by the pandemic.

"In an industry known for its tight profit margins and reliance on steady, consistent business, the shutdown has already led to several of our members closing their doors. For many owners already in a precarious position, this false start on indoor dining after they had paid for food, had their restaurants cleaned and hired employees has placed their livelihood in even greater jeopardy," she said.

Gopal said that often these small businesses that serve as anchors in their communities, support economic activity and contribute to the quality of life.

"They support our communities without fail time and time again," he said. "Now we will extend a hand to lift them up at this critical time."

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