Red Rooster chef Marcus Samuelsson on coronavirus restaurant act

Small and independent restaurants in the U.S. face a challenging road ahead, even if Congress approves additional financial support during the coronavirus pandemic, restaurateur and celebrity chef Marcus Samuelsson told CNBC on Tuesday. 

Samuelsson, co-founder of Red Rooster in New York City’s Harlem neighborhood, specifically referenced the so-called RESTAURANTS Act from Rep. Earl Blumenauer, D-Ore. The legislation would provide $120 billion targeted toward independent restaurants in the U.S., offering grants to put toward payroll and other operating costs.

Samuelsson, born in Ethiopia and later adopted by a family in Sweden, was the guest chef for the Obama Administration’s first state dinner. Also known as a judge on Food Network’s “Chopped,” he’s behind several other restaurants in addition to the Red Rooster in Harlem.

“If we don’t get this bill passed, I don’t know what’s going to happen to independent restaurants, and our neighborhoods and our communities will look very, very different,” Samuelsson said on “Squawk Box.” “Even with this, it’s going to take an incredible task to build the restaurant industry back.”

The $120 billion relief bill passed the House last Thursday as part of the larger $2.2 trillion coronavirus stimulus legislation. The Democratic-led bill is not expected to be taken up in the Republican-controlled Senate. 

House Speaker Nancy Pelosi, D-Calif., and Treasury Secretary Steven Mnuchin are currently trying to negotiate a bipartisan relief package to lend support to the U.S. economy, which has been devastated by the Covid-19 crisis. 

It is unclear whether the so-called RESTAURANTS Act — or something similar that specifically targets small dining establishments — would make it into a bipartisan deal reached by Pelosi and Mnuchin, who is leading the talks for the Trump administration. However, a second round of the Paycheck Protection Program is believed to be a key pillar of any future coronavirus relief legislation. 

“It’s not so much about getting this bill passed in terms of, ‘we want another loan.’ We just want to go back to work. That’s all we want to do,” said Samuelsson.

People wear protective face masks outside Red Rooster restaurant in Harlem as the city continues Phase 4 of re-opening following restrictions imposed to slow the spread of coronavirus on August 25, 2020 in New York City.

Noam Galai | Getty Images

While acknowledging the difficulties on the horizon, Samuelsson said they would be magnified without targeted government relief.

“It is the most important thing that can happen for us as communities, as restaurant workers. It has to pass,” he stressed, noting between 11 million and 16 million people work at independent restaurants. “This is the difference whether 70% or 80% of those 16 million people are going to go on unemployment versus being able to hire back 60%, 70%.”

Restaurants have faced significant challenges during the pandemic, initially having to cope with forced closures designed to slow transmission of the coronavirus. But since reopening, restaurants have had to operate with tables outside and at lower capacity indoors, adding to the operating challenges in an already low-margin industry.

Samuelsson said he believes it is important to make the distinction between chain restaurants that have access to capital markets and the hundreds of thousands of small restaurants in the country. 

“Our worlds look vastly different than big-box restaurant. They really do,” he said. “When you think about neighborhoods, when you think about the heart and soul of not only New York City and San Francisco, places like that, but American cities, independent restaurant is what makes the heart and soul of those neighborhoods.”  

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