Restaurant where Gavin Newsom attended controversial dinner party received millions in COVID relief funds

Restaurant where Gavin Newsom attended controversial dinner party received millions in COVID relief funds
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The French Laundry, the posh Napa Valley restaurant that hosted a dinner party attended by California Democratic Governor Gavin Newsom last month, landing him in hot water, has reportedly received millions in COVID-19 relief funds.

KGO News reported, “Yountville’s highly acclaimed French Laundry received multiple loans through the Paycheck Protection Program, totaling more than $2.4 million, according to an ABC7 analysis of newly-released data from the Small Business Administration.”

The loans were distributed by SBA-certified lenders earlier this year to provide a direct incentive for small businesses to keep their employees on payroll, amid the pandemic-induced recession. 

Newsom was accused of hypocrisy last month after photos emerged of him dining with a large group on November 6. Newsom, whose administration has pushed various health guidelines across the state, was berated across social media, which has accelerated an ongoing recall campaign against the governor.

The I-Team reports:

The French Laundry received two loans that were both approved on April 30, 2020. According to the SBA, the first loan was for more than $2.2 million to retain 163 employees. The second loan was for $194,656 to retain five employees.

ABC7’s analysis found the company received 17 times more than what the average Bay Area restaurant received. …

The I-Team analyzed thousands of California loans released by the SBA that show wealthier, big businesses are often getting access to loans before small mom and pop owners. Out of all the approved loans in California, 91 percent of larger restaurants with 300 or more employees got their loan approved in April versus only 52 percent of smaller restaurants with 100 or fewer employees.

Small businesses across the country that desperately needed financial aid struggled to obtain PPP loans. According to the Los Angeles Times, the program stopped accepting further applications after directing $68.6 billion to 623,000 California businesses. 

Speaking with Laurie Aaronson, a consultant serving hundreds of restaurants across the Bay Area, the I-Team reported that she had spent most of the year helping clients navigate through PPP application processes, which is often described as intimidating and confusing by smaller, family-owned operations.

“Clearly those who had established banking relationships with banks that chose to participate at least in the early stages… those who had access to financial advisors, accounts, and attorneys to make sense of the application received the loans,” she said.

The I-Team noted, “At the French Laundry, you can reserve an exclusive outdoor culinary dining experience starting at $450 per person or a White Truffle and Caviar dinner for $1,200 per person, according to reservation services online.”

ABC7 said the outlet reached out to the French Laundry for comment “multiple times” but had yet to receive a response. 

PPP loan recipients are eligible for forgiveness if they use at least 60% of the funding to keep employees on the payroll. Those that do not meet that requirement must repay the loan(s) at a fixed annual rate of one per cent.

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