SALEM — Over three-quarters of Oregon’s bars and restaurants are in danger of closing permanently without help from state government.
That’s the warning from a letter sent by the Independent Restaurant Alliance of Oregon, signed by hundreds of bar and restaurant owners, to state leaders Nov. 15.
The letter was written in response to the new “freeze” imposed by Gov. Brown that goes into effect Wednesday. Intended to check the uncontrolled spread of Covid, the governor’s order directs restaurants and bars to only offer takeout. Gyms, museums and other facilities must close.
Counties that are considered COVID-19 “hotspots” should expect the rules to stay in place for at least four weeks. Brown’s office said Friday that would apply to counties that continue to have more than 200 COVID-19 cases per 100,000 residents over two weeks, which includes Marion.
The letter asks for financial support for the struggling industry as well as breaks on leases and taxes.
“Right now, we need immediate financial assistance from the State of Oregon,” the letter said. “Without it our industry will perish.”
Signers of the letter include the owners of Salem-based restaurants and bars. They include Jonathan Jones, owner of Epilogue Kitchen and Cocktails; Tiffany Bulgin, manager of Isaac’s and IKE Box; Cecilia Ritter, the owner of Wild Pear Restaurant & Catering; Conrad Venti, owner of Venti’s Restaurants, Inc. Signers of the letter also include Diana Ramallo and Alena Stewart who operate Amadeus, Sweetsmith bakery and Alleycat bar, which all operate out of the same downtown location.
This is the second edict from the governor shutting down bars and restaurants for dine-in service since the pandemic struck the state in March.
As governors across the country issued similar orders, Congress responded with a relief package to help businesses, workers and local governments.
However, a second relief package has stalled in Congress. In issuing her most recent order, Brown acknowledged the economic pain it would cause and called on Congress to act.
The letter was directed to Brown, Senate President Peter Courtney and House Speaker Tina Kotek. It spelled potentially grim news for Oregon’s $9.7 billion restaurant economy that includes 10,456 eating and drinking establishments that employ nearly 9% of the state’s workforce.
When the state’s economy was reopened in the spring, restaurants and bars were allowed to offer dine-in service with reduced capacity, which cut into their profits and caused some to close, such as Salem Ale Works and Birdie’s Bistro.
Now, restaurants and bars “have no cash reserves and are saddled with crippling debt,” said the letter. During the initial stay-home order, the federal Paycheck Protection Program was available to businesses to help them keep workers employed. But now those funds have been exhausted, said the letter.
“Restaurants and bars cannot survive with to-go operations only,” said the letter. “A survey of independently owned restaurants indicates that the loss of indoor dining results in a revenue loss on average of 81.75% thus forcing closures and mass layoffs.”
Each time restaurants and bars close, they lose perishable inventory and have to pay workers to shutdown the businesses, the letter said. Following the governor’s initial stay-home order in March, closures resulted in losses on average of $40,000 per location, it said. Additionally, the closures have ripple effects on supply chains that harm bakers, fishers, butchers and farms, according to the letter.
The letter also restated a complaint from business groups that the governor’s order unfairly singles out restaurants and bars after they’ve largely followed pandemic precautions.
Following the stay-home order in March, the state’s unemployment rate soared to a record 14.2% in April, with most job losses in leisure and hospitality. The Oregon Employment Department was soon inundated with unemployment claims with unemployed workers, in many cases, waiting months for benefits.
On Friday, the department announced that it was preparing for a rise in claims. With support from the National Guard, it said it was in a better position to process them. In a statement, the department said it was developing an option for employers to submit employee information in bulk to help hasten the processing of claims.
“We are ready to take your claims and ensure you get your benefits as quickly as possible, whether through an existing benefit program or any new federal program that may get passed,” said the department’s acting director David Gerstenfeld, in a statement.
The department advised workers affected by the order who’ve returned to work to restart their claim online. Those unable to restart their claim should contact the department. The department is also administering a federal program designed to help workers affected by the pandemic and has created an “Eligibility Quiz” to determine what benefits workers are eligible for.
But the letter from the restaurants and bar owners raised alarms that the state’s unemployment system will again be overwhelmed. It called for workers unemployed because of the governor’s order to receive their benefits without delay and for the state to waive the waiting week before they are eligible.
The letter also asks the Legislature to pass laws before the year’s end allowing drinking establishments to sell to-go cocktails, extending the moratorium on commercial evictions and permitting businesses to default on leases without having their owner’s personal assets seized.
Additionally, the letter called for more access to testing and contact tracing to contain the virus’ spread.