Jarrett Walsh bought The Tasting Room just weeks before Gov. Larry Hogan ordered restaurants to switch to take-out and delivery only due to the COVID-19 pandemic. So he did.

Then in April, he closed. The takeout model didn’t generate enough income at the time to keep his restaurant sustainable.

But now, as the state nears its first stages of reopening, Walsh opened his doors again, despite still having confusion with some of the state’s relief programs.

“I’m in a special situation, which is I just bought a restaurant on March 2, so I have pretty extreme amounts of loans to repay,” Walsh said. “… That was the main thing, we have to figure out a way to make a little bit of money to be perfectly honest.”

Many Frederick restaurants have see-sawed between being open for carryout and being closed altogether since the state of emergency began on March 15. Between an uncertain timeline for reopening the state, confusing grant guidelines and reductions in staff, restaurants across the county have been unsure about whether or not to continue their carryout and delivery services.

Hootch & Banter on Market Street closed when restaurants were ordered to close on March 16. But last Thursday they opened back up for carryout for the first time.

Cherie Salem, co-owner of the restaurant, said she and her husband made the decision to close to keep their staff safe. Now, with most of them on unemployment, they decided to reopen Thursday through Sunday each week with a limited amount of staff.

“We can’t stay closed for an extended period of time,” Salem said. “We had to do something.”

Similarly, Shuckin’ Shack on Market Street closed for the first two weeks after the governor’s order. Wade Newman, co-owner, said at the time he didn’t know how long the order would last, and wanted to make sure his employees were all safe.

“Nobody knew what to expect and obviously you worry about your employees, is probably the most important thing with what’s going to happen there,” Newman said. “So, just wanted to figure out what was going to happen and then go from there.”

By April, Shuckin’ Shack opened back up on the weekends. That also made it easier to order inventory, Newman said. Since Shuckin’ Shack primarily serves fresh seafood, they didn’t want to risk getting deliveries every day that could go to waste.

However, he hasn’t had much trouble getting inventory in, which other restaurants said has been strenuous, as food supply chains struggle.

All his employees have gone on unemployment, and Newman is primarily working with just his business partner to run the restaurant. He applied for the Paycheck Protection Program but hasn’t heard back.

Walsh, on the other hand, received his Paycheck Protection Program assistance on May 1. But with most of his employees already on unemployment, he’s not sure how to use it.

“That was great,” he said. “But the incredibly murky rules and guidelines on how you’re supposed to use that money has created an enormous problem.”

The PPP, offered by the Small Business Administration, allows businesses to take the assistance as a grant if they spend 75 percent of it on payroll and 25 percent of it on rent and utilities within an eight-week span.

But Walsh only has 10 employees working right now — the maximum he can have in the restaurant with social distancing guidelines in place.

While he can extend re-employment offers to his employees, if they choose to turn them down, he has to document their refusal to return back to work and send it to the Department of Labor, Licensing and Regulation, which could lead to them losing their unemployment benefits.

“I have to maintain the same number of employees as before, which is basically impossible, because I can’t have as many people in the restaurant,” Walsh said. “So I have to basically invite them to be rehired, and if they decline, then I need that in writing, and that then counts toward the number, but then they get kicked off unemployment, so that’s not so nice.”

The SBA stated in an FAQ on its website that employees who are offered to be rehired but dismiss the offer will count toward the company’s total number of employees, but they must get it in writing.

So Walsh is in a difficult spot.

“So either I take it as a loan and use that loan to repay other loans and do that whole mess of a thing, or I try to get it as a grant, and take people off unemployment to potentially have them be put back on unemployment after eight weeks because I don’t know if we’re going to be open to full capacity,” he said.

Business, he said, hasn’t been as great as it was when the restaurant originally did takeout in the last couple of weeks of March.

Newman said Shuckin’ Shack’s business is OK on the weekends. He’s unsure what the next month or two could look like for the restaurant as the state begins to reopen. Restaurants are encouraged to limit their seating, but that’s difficult to maintain with a restaurant like Shuckin Shack that is already small and has a long and narrow corridor of seating throughout most of its restaurant.

“So at that point, then you have to think about your staff and you kind of got to weigh the numbers there,” Newman said. “So for us, we’re just going to wait and see what they do come out with.”

Walsh, too, is nervous about half-opening, which could lead to him not needing as much staff. He doesn’t want to rehire his staff just to have to lay them off again a few weeks later.

“I’m just hoping for some clarity and some guidance on this PPP money and hoping to get some clarity on when we can open back up, but I understand that’s very hard to do,” Walsh said. “I hope nobody gets sick.”

Follow Erika Riley on Twitter: @ej_riley

(51) comments

caspiansails

More the needless interjection of Jan into the entire mess. By no standards is Frederick County a true hot spot. Exclude nursing home infections and fatalities and what do you have? Not saying they are not relevant but they are not affected by openings at all as they remain closed to the public which is not good at all for the residents who have not been able to visit in person with a family member for months. Even I can figure out how to do that safely.

bosco

Can anyone explain how opening restaurants and small businesses, with restrictions such as masks, is any different than allowing corporate Walmart and Home Depot to stay open? The first goal was not to burden the health care system. Now it seems to have morphed into if you want to reopen you're a racist Republican and if you are for continuing lockdown you are a Democrat.

Hollowed Ground

Ignorance abounds. What no one mentions is time. At WM and HD you can zip in, get what you need, and zip out. Sit down restaurants by their very nature require lingering. Not good. Time increases concentrations and defeats masks. Highest risk are the servers who have to be among fool diners without masks. Could not pay me enough to risk my health and life to serve lousy food to fools. Let them all serve themselves.

elymus43

The best restaurants will survive. Some will raise their prices, and that will hurt them.

bosco

A little more distance between tables and a smaller crowd might make for a more pleasant dining experience. The noise level would certainly be reduced. One of the reasons we don't go out to eat at peak times is that we want to converse during the meal, not shout to be heard.[ninja]

Piedmontgardener

Everyone has to work together to patch a model that works, somewhat. I feel terrible for Walsh, he's in the worst position imaginable, having paid top dollar for something that he cannot possible run for the foreseeable future. People are not going to run back into restaurants or bars, no matter how the WSJ and the President wave their arms. Fine dining may not return until there is a cure or we have no active cases. That's terrible, but it is my conclusion. This like any other major natural disaster, it just doesn't come with physical property damage.

vodalone

The industry which has been mostly affected by this is the restaurant and retail industry locally. For many going back to work, juice ain't worth the squeeze. $430 + $600 / week on UI = $1030 / week x 52 = $53,560 plus stimulus payment of $1200 per person. For a household with two full time working adults that's $109,520 / year including stimulus payment (not including stimulus payment for children). Not too shabby, and you avoid potentially getting sick at work. I don't blame many wanting to stay home with that kind of cash. However, not all of us like to rely on others and some want to control our own destiny.

thump1202

The extra $600/wk is only good for 4 months, not for life as you seem to believe, so you'll have to adjust your math.

vodalone

It's actually good for 6 months and is very likely to be extended beyond that with upcoming legislation.

steelersfan2005

its only good for 4 months and wont be extended. Unemployment is only for 26 weeks.

jagman

No, it was set up for 4 months total.

That's the only reason I didn't object to it. I knew it had a time limit.

vodalone

Jagman, steelersfan. Page 3, bullet 1 clearly states 26 weeks. That's 6 months.

https://oui.doleta.gov/unemploy/docs/factsheet/UI_Program_FactSheet.pdf

jagman

That's for standard unemployment insurance. Been that time frame for a long time.

We're talking about the $600 juice the fed is throwing in under CARES. That has a limit of four months.

vodalone

Jagman. That fact sheet is from the federal CARES Act Department of Labor site. You can check for yourself. If you have been paying attention to legislation currently in Congress federal benefits are likely to be

extended.

jagman

I could be you picked the fact sheet from the CARES act site. However, it's just the same fact sheet that describes the general unemployment benefits.

I am aware they are "considering" some sort of additional unemployment benefits. It remains to be seen if that will happen.

wran

I am all for reopening and letting people make their own decisions. But, can they be trusted to make right decisions. I just read a report stating 2/3 of American adults are obeise, and the percentage is increasing. Also, 20 % of youth are obeise and the percent is increasing. Health consequences of obeisity are well known, but not heeded.

jagman

We can never expect people to make wise decisions. Most people make poor decisions. However, in a free society (which is what we had, sort of, before this fiasco) we understand that.

It is impossible to make everything "safe" for everyone all the time. freedom come at a price.

Or, as the old saying goes: "freedom is fraught with peril".

MrSniper

We can’t have things both ways. Either we fully fund social safety nets & raise revenue, or we keep taxes low & when disasters happen people will more or less be on their own. Generations of irresponsible politicians have led the people to believe we could have both...if nothing happens. Something always happens. People need to grow up, look at the big picture. This thing is relatively minor in the scale of things...it could definitely be much worse. Let’s not wait until that happens. There is an election coming in November. Contemplate that when you place your votes.

Greg F

There is a balance, and it can be a LOT better than we have it now. We can stop paying obscene amounts to CEOs, tax reasonably as we had in some decades past when most things worked well and did not entirely benefit the wealthiest among us go get wealthier, fund education and research so we can grow up smart enough (if so desired) to find a career vs job that we can make reasonable money to live off of and understand the world around us, and have things improve through that research. CEOs, banks, Wall Street, and Fossil Fuel industries have lived high on the hog for long enough. Politicians need term limits set and strict no-lobbying rules need to be put in place to keep them the he11 out of things after being out and from lobbyists getting into politics like they are now. News organizations need to be held to some better standards than peddling hate and fake everything. Republicans are pandering that the health care system is more expensive now, but killed the one chance we had with ACA to actually do something. Unfortunately they wanted profits for their masters and killed it. So...there you go...vote in that monster again...get more of the same BS, ignorance, corruption, profiteering, nepotism, or get practically anyone else in there. It literally cannot get worse.

newspostreader

This virus isn't going away. It's now part of our life and we have to figure out how to move on and live while taking necessary steps to try to limit it's spread. Stores and restaurants need to reopen before they all go out of business. Florida has reopened restaurants with special distancing requirements, why can't we? I know this is an unpopular opinion, but each person can decide what is best for them. If they're concerned about being infected, then stay at home. At some point we have to trust each individual to take necessary actions to try to protect themselves or we're going to be in this same shutdown situation a year from now.

Jleftwich

I don't profess to know all there is about operating a restaurant. I do know they operate on a razor thin margin under normal conditions. And they have a model in place that relies on a certain capacity or certain amount of foot traffic.

So, while the gov't may ease restrictions, a restaurant may not reopen for seating at a limited capacity; it would not make financial sense. Owners have probably figured out how to make money based on the carry-out model (and obviously the normal, no restrictions model). But there is no real way to know about the in-between: 25 percent or 50 percent capacity.

Like you said, the virus is still with us. We're flattening the curve, but the goal there had been to buy time and not overburden the health care system.

Can we go back to work? Ease restrictions? Yes, but that requires everyone behaving themselves and continuing social distancing and wearing masks for a while. As we have seen, that is tough. Complacency sets in.

msmith6276

I don't think they are coming even close to breaking even under the takeout model - just trying to staunch the bleeding. The margins are in the single digits under full operations.

As to reopening this places - I read data from Open Table that after reopening in GA that dining was still down 80-90%.

We all saw the Mother's day fiasco in Colorado but sadly a lot of places are not going to be able to hold on until we get to 100% capacity (and who knows if we will ever get there before a vaccine widely available).

I urge people to Google "Erin Bromage blog post" - no political agenda - just science.

MD1756

More people eating at home would allow for more people to save money to have for emergencies.

MrSniper

This may end up being a footnote in history like 1918 H1N1 or it may turn out like you implied. We don’t know what we don’t know. Responsible public heath officials are being cautious, as they should. Restaurants & bars are particularly risky places to open. We have already sunk a considerable cost into the precautions we have taken. It would be foolhardy to waste the sacrifices already made in an effort to return to a normal that may never exist again. We are a few weeks behind where some other countries are in their recovery. It would behoove us to look to them as examples of what has & hasn’t worked. We’ve come so far, prudence will be the virtue that pays dividends in lives saved as well as economically.

Greg F

1918 wasn't a footnote to those who went through it and knew about it before this pandemic came along. It was less than that to the guy who ignored the warnings and dismantled the pandemic response team and funding well ahead of this one's arrival.

Greg F

Anyone that is less than a few years old is not likely to survive. It can take that long to get your bearings, a solid reputation and client base, and capital to survive. Most don't make it a year, even with the best ideas. I've tried to support those that are local the most and am trying to shake off the chains that are doing well enough they could do without me for now.

Street92

It's a bad flu, that's all. You catch -- and you probably already have -- you have less than 1/10 of 1 percent of dying.

MrSniper

No. You are lying or you don’t know what you’re talking about. Flu is less than .1% mortality. Covid 19 is 3-4%. A significant factor more. Get educated or get quiet.

jagman

You've bought into the model of comparing deaths with "confirmed" cases. Bad model. Bad math.

You also don't account for the now known fact the death numbers have been juiced by the government. Perhaps as much as 25%.

So yes, it is a bad flu. Clearly more contagious than normal flu but not nearly as deadly as initially predicted (again, bad modeling).

vodalone

3-4% mortality is nowhere near a final number as there is not enough testing to determine that. Based on studies of larger groups who have been in close proximity to each other (Diamond Princess cruise ship, USS Theodore Roosevelt, case studies in NY and CA) the mortality rate is well below 1%. Chill with the fear mongering okay.

Greg F

Street, there is no excuse for such a pathetic statement. Please...I beg you if you think you are right, go stand at a checkout at any major store for the day or a week and see how you do after that. I know you're not supposed to bash people or call them ignorant, but wow...that...is....IGNORANT!!! I think jumping off a cliff is safe...can you please go try it and prove it's true?

steelersfan2005

It isn't a flu at all, but a virus.

MD1756

Many people have repeated this mantra of if you don't like the risk, stay home. People should have the expectation of not being adversely impacted by others no matter where they are (at home or out in the public). For people who live alone (such as myself), we have no choice but to go out and about our business. Are you willing to give me money to pay for the extra cost of delivering food, etc? In any event, there are tasks (i.e., doctor's visits, dentists visits, etc. that cannot be done by someone else). People have shown themselves to be untrustworthy time and again when it comes to their negative impact on others (not just negative health impact, but monetary, quality of life, etc.) and that's not going to change now. Many people also seem to have the belief they can do what they want regardless of their consequences, which to me seems to be selfish.

tammybennett7

I agree with you 100%! Like you said, if a person is concerned about becoming infected, stay at home! Our businesses need to reopen in order to try and survive!

steelersfan2005

you wouldn't even need to reopen if you took the PPP Loan until the end of June Just pay your employee's 40 hours a week to sit at home. It is basically free money as long as you use 75% of it for payroll purposes.

sevenstones1000

The employees, who have gotten themselves settled on Unemployment benefits (no small feat in this environment, worst since the Great Depression) will have to come off Unemployment and then reapply all over again.

I wouldn’t do it.

steelersfan2005

If the establishment accepts the PPP loan to pay their employees, then the employee must return to work, if the said employee refuses to return, just to stay on unemployment, he risks losing his unemployment due to fraud. You cannot refuse work just to stay on unemployment.

Greg F

That covers the payroll, not the fixed expenses. Open for takeout...anyone who wants to work is doing so voluntarily knowing the risks. Anyone who eats from an open restaurant these days also assumes some risks. I'll take out hot food, but nothing that's sat cold like deli meats and isn't heated to safe temperatures enough to kill the germs...below 40F or above 140F...that's the safe zone...except I'd still want it to be heated since below 40F only keeps the germs from reproducing rapidly instead of actually killing them.

steelersfan2005

it does cover fixed expenses such as your mortgage interest, Rent and utilities. The PPP loan is to be used to cover 75% of your payroll expenses, and 25% of your non payroll expenses thru June 30th.

Greg F

That leaves 25% of your payroll and 75% of your fixed expenses not covered by your math. June 30th is coming fast, and business will never be enough to cover this missing butts-in-seats ratios they need to survive.

jimmycarlblack

No, you and Greg F. are misinterpreting PPP. If you receive PPP money, it will equal 2.5 times your monthly payroll. Of that total amount, at least 75% must be spent on your payroll, and up to 25% spent on rent and utilities, in order to have the loan forgiven. It is NOT 75% of your payroll and 25% of non-payroll expenses. I am a small business owner and the recipient of a PPP loan.

francesca_easa

Thinking out loud here, but is it possible to use the PPP and keep your staff on the payroll, and schedule them every 3rd day to work? That way you keep and don't need to report to MD Unemployment that they refused work. They get paid as if they worked their regular schedules, while working less. And you don't need to worry about having too many people working closely together. What people forget is that once these extended benefits end in July, there will be more competition for jobs. Better to have a job now, then be looking for one later.

DomoB

Yes that’s possible. I know of businesses that took their whole staff off of unemployment because they were approved for the PPP loan. The staff are not working but they are officially “employed” and getting paid what they would have been if they were employed. That’s basically what the money was meant for to relieve the state from the financial burden of all the unemployment claims. At the end of 8 weeks when the money runs out and they’re still not open all of them will file for unemployment again.

francesca_easa

Sounds like a reasonable solution.

sevenstones1000

Do you know how difficult it is to file for Unemployment?

MrSniper

Tell us all, how difficult is it to file for unemployment? As I recall from my own experience, I made a phone call, was scheduled for a over the phone hearing, then had to report in every week. Shockingly easy for me (back then in 2003 & 2006). I imagine the systems are overwhelmed with those filing. The case could be made that this is a consequence of underfunding our social safety nets for years. Think about that next time you vote to give the “job creator” class another tax break.

Greg F

Sniper....that was 2003...2006....there are tens of thousands now trying to use a broken system that is painfully understaffed and weeks behind. Many who filed do not yet have those checks coming in. There are plenty of stories on this in many MD sources...and I saw FNP post one not long ago on how bad it is.

Greg F

PPP doesn't cover the rest of the bills. How would you like them to pay those? Many, like Tasting Room, just were purchased so have a mountain of bills due over and above payroll with no income.

steelersfan2005

Actually it does. It covers Rent, Mortgage Interest, and Utilities as well as your payroll expenses. its the 75/25 rule. 75% Payroll, 25% non Payroll.

Greg F

Not enough to cover it all...and many didn't get it...and won't in time even if they re-apply. PPP funds ran out after 2 weeks...new funds...good luck with that in the meantime.

steelersfan2005

they passed a 2nd PPP package, and funds are still there for the grabbing.

Welcome to the discussion.

Keep it clean. No vulgar, racist, sexist or sexually-oriented language.
Engage ideas. This forum is for the exchange of ideas, not personal attacks or ad hominem criticisms.
TURN OFF CAPS LOCK.
Be civil. Don't threaten. Don't lie. Don't bait. Don't degrade others.
No trolling. Stay on topic.
No spamming. This is not the place to sell miracle cures.
No deceptive names. Apparently misleading usernames are not allowed.
Say it once. No repetitive posts, please.
Help us. Use the 'Report' link for abusive posts.

Thank you for reading!

Already a member?

Login Now
Click Here!

Currently a News-Post subscriber?

Activate your membership at no additional charge.
Click Here!

Need more information?

Learn about the benefits of membership.
Click Here!

Ready to join?

Choose the membership plan that fits your needs.
Click Here!