Restaurant Where Newsom Was Caught Eating During COVID Got 17x More PPP Funding than Other Bay Area Restaurants
The swanky Napa Valley restaurant where California Gov. Gavin Newsom was caught dining while ordering the rest of the state to be locked down received more than $2 million in Payroll Protection Program loans, according to a new report.
KGO-TV said its analysis of data from the Small Business Administration showed that the French Laundry received two loans.
Both loans were approved on April 30. One loan was for more than $2.2 million to retain 163 employees. A $194,656 loan was also approved to retain five employees.
KGO-TV said that the total for the elite restaurant was 17 times higher than what an average Bay Area restaurant was allowed.
The report noted that dinners at the French Laundry can cost up to $1,200 per person.
The restaurant’s owners did not return calls seeking comment.
“That’s a lot of money. But, what can I do about it?” said Dennis Berkowitz, who sold his business in July after a $318,000 loan to retain 50 employees was not enough to keeps his San Mateo restaurant, Vault 164, going.
“I’ve had a 40-year run in the restaurant business, so I consider myself fortunate,” he said. “I really feel bad for the next generation of restaurateurs because they’re screwed.”
KGO said its analysis showed that size mattered in PPP loans. The station said 91 percent of restaurants with 300 or more employees had their loans OK’d, but only 52 percent of restaurants with 100 or fewer employees had loans approved.
A separate KGO-TV report said that eight companies owned in part by Newsom received almost $3 million from the Paycheck Protection Program.
The report noted that although Newsom placed his ownership interests in the Plumpjack Group into a blind trust, he remains publicly listed as the group’s founder. His sister, Hilary Newsom, is listed as president.
The report said Villa Encinal Partners Limited Partnership, which it linked to the PlumpJack winery in Napa, received a loan for $918,720 on April 14. The report said the SBA data said 14 employees were retained through the funding.
“It’s unexpected for a 14 employee organization to get nearly $1 million,” said Sean Moulton, a senior policy analyst with Project on Government Oversight. “The purpose behind this program was to save entry-level jobs, people going in and working on that paycheck. That was what we put this out there for, to stop unemployment.”
Erin Burke, who owns the Millbrae Pancake House, told KGO that something seems off because, under terms of its PPP loan, the restaurant received $431,400 and retained 53 employees.
“That seems unfair because there are small family businesses like ours that need that money,” Burke told the station.
An official with the San Francisco Chamber of Commerce told KGO that most businesses felt they did not get enough through the PPP process.
“I think it’s heartbreaking,” Jay Cheng, the chamber’s public policy director, told the station. “We see huge discrepancies between small business and the kind of loans they got and their ability to get loans and larger companies that are well-resourced and well-staffed and had strong relationships with their banks.”
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