Unemployed residents and struggling restaurants in Hawaii could soon share $67 million in federal coronavirus aid under a new state plan.
Details have yet to be shared publicly by the administration of Gov. David Ige, but $67 million in CARES Act aid received by the state has been allocated for a restaurant cash card program that provides financial support to unemployment claimants, according to an organization that has partnered with state agencies tracking Hawaii CARES funds.
Jill Tokuda, an official with the Hawaii Data Collaborative, told the House Select Committee on COVID-19 Economic and Financial Preparedness on Monday that the program could be rolled out in a week or two.
More information could not be obtained from the governor on Tuesday, but some local restaurant owners said such a program appears to be a creative initiative to help a badly hurt industry along with the unemployed.
“We’re dying,” Eddie Flores Jr., owner of the L&L Drive-Inn chain, said about Hawaii’s restaurant industry. “Anything that could help us would be great.”
Tom Jones, co-owner of three Gyotaku restaurants and Koromo Katsu &Bistro on Oahu, called the program a creative idea that would help two groups at once.
“It would help people on unemployment get food to feed their families, and in turn lift sales in restaurants to help restaurants keep the lights on and employees employed,” he said.
Jones, past chair of the Hawaii Restaurant Association, said half of all Hawaii restaurants aren’t open, and the “lucky” ones have sales that are down only 50% when a 10% to 20% decline puts most restaurants below a financial break-even level.
“We’re reeling,” he said.
Victor Lim, legislative liaison for the Hawaii Restaurant Association and a local McDonald’s franchisee, said the trade association supports the plan and hopes it is launched quickly.
“A program like this is really a win-win for our community,” he said. “Our restaurants are dying on the vine with this open-shut, open-shut (situation). Unemployed people also need assistance. People need to eat.”
Lim said there could be restrictions on how the restaurant cash cards could be used, but he believes people receiving unemployment benefits will use cash cards for basic food needs.
The U.S. Bureau of Labor Statistics earlier this month reported that Hawaii tied with New York for the third-worst unemployment rate in August at 12.5%, behind Nevada and Rhode Island at about 13%.
The Hawaii Department of Labor and Industrial Relations reported last week having paid $3.3 billion in unemployment benefits on 179,484 claims.
According to the most recent state data on businesses in Hawaii, there were 3,542 food service and drinking places statewide in 2018, representing 11% of all Hawaii business establishments with employees. This count does not include food service operations connected with hotels and other visitor accommodations.
According to an analysis by online business-rating platform Yelp, the restaurant industry had the biggest permanent closure rate nationally through July 10 since economic damage from the pandemic began in March.
Among all types of businesses, Hawaii’s rate of permanent business closures during the period was second-highest among states, the Yelp report said.
“Our economy has taken a licking in the chops,” Lim said. “We definitely could use a shot in the arm.”