The Bloomingtonian

Area restaurants feel financial impact of COVID-19 emergency; petition to use food and beverage tax to save local restaurants

By Marci Creps

Monday morning, Kurtis Cummings of Switchyard Brewing was watching CNN.

The prior evening, he’d made the difficult decision to furlough is staff. He adjusted the tap room’s hours and stopped offering up the business as a cowork space. While spring break week is normally quiet, COVID-19 fears were keeping all customers away.

While restaurants have tried to make changes to continue to operate during the COVID-19 situation, things are getting more difficult for many small businesses.

Around the country, states are choosing to close down restaurants and bars in an effort to stem the spread of the coronavirus. Watching the news, Cummings was expecting the worst before Indiana added itself to the list of states closing restaurants and bars.

“The writing is on the wall. We’re probably just going to have to close. And if that happens, the thing is, rent’s still due. The loans are still due to the bank. Payroll still has to be met at least for the previous pay period,” Cummings said.

Within the hour of talking about what was happening, Gov. Eric Holcomb announced the closure of bars and restaurants. It was a hit Cummings – and many other restaurant owners – were expecting.

But Cummings made one promise to his staff Sunday night. He would fight to keep the business alive. One way is through a change.org petition to ask that some of the funds from the Monroe County food and beverage tax be available to small, local businesses to help them through this financial crisis.

Cummings said there is about $6 million in the fund. He is asking local and state officials to consider using half of the money in the fund to offer loans to small businesses.

The idea came last week when Cummings participated in a conference call with the local chamber of commerce that included more than 45 business owners. The talk centered around concerns over COVID-19 and what businesses were doing.

He said Switchyard saw a 50 percent loss in sales last week and $6,000 in special event fees that needed to be refunded due to event cancellations. While some special event hosts are holding off getting a refund with the intent to reschedule, there are still losses that will be difficult for a small business like Switchyard to absorb.

At Crazy Horse, owner Ron Stanhouse said the restaurant’s foot traffic had been surprisingly good. He’d heard stories that other restaurants were empty. While he understands the move to close down restaurants, he worries about the long-term effect.

“While we want all of our friends and neighbors to be safe from virus concerns, we are just as concerned about the health of the Bloomington business community. A protracted downturn would harm all of us for years to come,” he said.

Prior to the governor’s announcement, Stanhouse said the business had been talking to staff and suppliers. With staff members without jobs and suppliers without customers, Stanhouse isn’t sure what to expect other than knowing it won’t be good.

“The economic ripple effect will be difficult for all of Bloomington, and I expect some businesses will fail with damage done up and down the supply chain,” he said.

Cummings hopes that by using the food and beverage tax that small businesses can find a way to survive. He’s modeled the plan after what other cities are doing and sees it as an opportunity for businesses to apply for a zero-interest loan so the money would be paid back for the future convention center’s use.

There would be rules so that only businesses affected by COVID-19 would be eligible. He also said businesses would need to depend on foot traffic, meaning people need to be able to prove that having customers physically in the store is necessary for survival. He also wants it to be open only to locally owned businesses that aren’t part of a corporation. He used the example of a locally owned restaurant that is part of a larger chain. While the business owner may be affected, there could be help from the corporate office that would not be available to a business such as Switchyard.

Cummings said the use of the food and beverage tax is possible as it is part of the code that it can be used for economic development purposes.

Cummings understands the need for an expanded convention center. He has seen large conventions move out of Bloomington because they’ve outgrown the space available here.

“I do think that this town could use a bigger convention center,” he said.

The timing of the closures due to COVID-19 couldn’t have come at a worst time. For many small businesses, there are naturally slow times in a college town. Many are used to the ebbs and flows that come with students. By shutting down businesses and the university, it will make it even more difficult for businesses.

“Without that even happening, what you’re seeing is we’re basically extending the summertime months by 120 days,” Cummings said.

Cummings has talked to county council members and said he knows city government has also been working on a solution for helping small businesses. Since the city and county both tout Bloomington as a great place to visit due to its local and unique businesses, Cummings is hoping that will turn into support for using the food and beverage tax to save that uniqueness.

Many restaurants are trying to find ways to still serve customers. At Switchyard, the taproom is open for carry-out sales only with both curbside pick-up or delivery. Many other restaurants are offering the same.

Likely, it won’t be enough, which is why Cummings is hoping to garner support for using the food and beverage tax. He feels that many small businesses often support local philanthropic causes. For Switchyard Brewing, the business has donated more than $20,000 to local causes.

“And so we’re asking is, ‘Hey. We’ve been there for you guys. We’ll always be there for you. We’re asking you to help us in return,” Cummings said.

HOW YOU CAN HELP

As of 11:30 p.m. Monday, the change.org petition to use the food and beverage tax has more than 3,600 signatures of the 5,000 Cummings is trying to reach. To sign the online petition, visit https://www.change.org/p/emergency-reallocation-of-the-monroe-county-food-beverage-tax-to-monroe-county-small-businesses.

Rate this post

Click on a star to rate it!

Average rating 5 / 5. Vote count: 13

No votes so far! Be the first to rate this post.

Liked it? Take a second to support The Bloomingtonian on Patreon!