Texas Restaurant Association Warns of ‘Wave of Closures' Without Federal Aid

The Lemmon Avenue location of El Fenix recently joined the list of shuttered Dallas restaurants

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Many restaurants in Texas have struggled to stay afloat during the pandemic, with 14% estimated to have closed permanently, and industry groups worry that number could grow without an emergency infusion of financial support.

After more than 60 years in business, the Lemmon Avenue location of El Fenix, near Dallas Love Field recently joined the list of shuttered Dallas restaurants.

"Given current conditions, unfortunately we have made the difficult decision to not renew our lease," Mike Karns, founder and CEO of the Local Favorite Restaurants group of which El Fenix is a part, said in a written statement.

It's a decision hundreds of restaurants — and bars — have been forced to make as they confront empty seats and dwindling revenue.

The industry benefitted from the Paycheck Protection Program, but that program provided support for only eight weeks out of the last six months of the crisis, said Kelsey Erickson Streufert, vice president of government relations and advocacy for the Texas Restaurant Association.

Streufert said survey data show that about 50% of restaurant operators do not think they can continue to keep their doors open for another six months without additional relief from Congress.

"We know that Speaker Pelosi and the White House continue to negotiate to try to reach a COVID-19 relief bill, but frankly with every day that passes the chances that deal comes together becomes smaller," she said.

The situation has improved since March. The Texas Restaurant Association estimates about 200,000 industry workers are currently displaced, down from 700,000.

State regulatory waivers, such as allowing alcohol to-go sales, have helped restaurants add a little bit more revenue.

And Gov. Greg Abbott's announcement in September that restaurants in most counties could open at 75% capacity helped to boost consumer confidence in restaurant safety even if, for about 37% of operators, the new limits were not feasible because of spacing requirements, Steufert said.

What restaurants really need now, Streufert said, is more financial support to help owners reinvest in their businesses in new ways, such as changing floorplans or putting up partitions.

"If Congress is able to come together and pass a relief bill that does help industries like ours, we'll see many more restaurants be able to rebound and survive," she said. "If we don't see that relief, I think you will see a wave of closures, particularly in the winter months when it becomes more difficult to eat outside."

In the meantime, restaurateurs hope people continue to support them with curbside pickup, dining in or in other ways.

"It makes all the difference in the world," Streufert said. "... We are doing everything we can to advocate for our industry and the hundreds of thousands of families in Texas who rely on it, but the thing that's immediately within our control is where we spend our money, where we spend our time."

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