Bars shut down across Texas on June 26 after Gov.+ Greg Abbott ordered certain restrictions back into place in a last-minute effort to flatten the skyrocketing surge in positive COVID-19 cases. Establishments that receive more that 51 percent of gross receipts from the sale of alcoholic beverages shut down for a second time, while restaurant operational capacity is back down to 50 percent.
This means trouble for many small businesses that rely on in-person service to thrive, and while curbside service is certainly an option, in many cases it still doesn’t cover the bills. Owners have expressed concern that many establishments will have to close their doors if communities can’t get the spread of the virus under control within the next few months.
At Kraken Lounge in Brownsville’s downtown, owner Dannie Alvarado closed shop for 2 1/2 months and opted to re-open under Abbott’s original plan. “For two months I made zero money. When we opened, it was slower than usual, but even that little burst of cash was helping me pay something,” said Alvarado.
Kraken served pizza curbside for a limited time, but Alvarado explained that bills to operate the oven, lights, and air conditioning outweigh the sales, leaving him in a tricky situation. “I am scared about this virus. But, I can’t just close. I have to suck it up — this is my life. I can’t just throw it all away. These are tough decisions. I’m going to wait for the green light,” he said.
The bar is holding a fundraiser to cover costs, viewable on its Facebook page.
Not all businesses have been able to take advantage of the loan assistance options available — the uncertainty carried with the pandemic means that owners might not be able to shoulder the risk carried with a $50,000 Small Business Administration (SBA) loan, for example, if they won’t be able to keep up with payments when the time comes. All of that depends on the spread of the virus.
Michael Limas, co-owner of Las Ramblas at Market Square, is also chairman of the Economic Development Board for Brownsville. He explained how the board dedicated around $400,000 for COVID-19 assistance and helped facilitate SBA loans, providing information to those who need it.
Limas suggested that bar owners facing economic hardship caused by the shutdowns get on social media and check the pages of the board, the Brownsville Chamber of Commerce, SBA, and ask for assistance finding resources.
Under SBA’s guidelines, a portion of the PPP loans are forgivable if they’re used within the time frame and requirements outlined by the agency. This is a problem where businesses can’t be open. “Accessibility to funding is phenomenal If you’re a construction company and need PPP, you’re considered essential, you can continue building those homes,” said Limas.
“But if you’re in the hospitality industry, there’s nothing for employees to do. The benefit of the PPP is that a portion is forgivable, so it essentially becomes a grant, but you have to use the funding. And if not, it’s a loan. You have to pay it back.”
Every situation is different. On the bright side, the owner said the newly issued restrictions are much clearer than last time and will enable spaces like Las Ramblas to offer sustainable curbside options to customers.
And while some bars might be able to make the stretch until re-opening, others may not have landlords that are willing to provide forbearance or rent assistance. Las Ramblas is looking at options to potentially re-open in early fall, but that depends on how the city, county, state, and federal governments are able to respond to a growing crisis.
At Half Moon Saloon, Rea De Camp, daughter of the late George Ramirez — the man responsible for founding the Latin Jazz Festival — was forced to close when the pandemic hit. “With no money coming in, there certainly wasn’t enough money to open it back up once we were allowed to open it back up,” said De Camp.
The owner is based out of state and is looking to sell Half Moon. “I feel like a bar needs to have a local owner,” she said of the decision, but emphasized that stress on local business is deterring potential buyers from stepping up to take over the establishment.
“Really, it saddens me for the staff, because they’ve shown so much love and compassion and selflessness through all of this for months — my father went into the hospital last July. I feel like this is not the reward I wanted to give them, to have to let them go in the middle of a pandemic.”
Asked what residents can do to help, the owner said she wants to see Brownsville rally to support its local businesses through steady and active participation in curbside services.