California restaurants demand reimbursement of state and local fees
California restaurants and bars hit by indoor dining restrictions continue to pay state and local fees for liquor license, health license and tourist evaluations.
Now, independent restaurants are asking for reimbursements totaling tens of millions of dollars. Claims were filed Monday in the largest counties in California: Orange, Los Angeles, San Diego, Sacramento and Monterey County.
Restaurateurs say they shouldn’t pay the costs in full when the state restricts restaurant operations.
âRestaurant owners are forced to pay these government fees just to operate, but the same government entities that collected these fees have forced these businesses to shut down or significantly restrict their operations due to the pandemic,â Brian Kabateck, the lawyer representing the restaurants, said in a statement.
“We just want the government to reimburse these fees to restaurants that have obeyed the law and closed,” he said.
Kabateck said more claims will be filed in the coming days in San Francisco, Fresno and Placer counties. The state has 45 days to respond. He said filing these claims “is the first step before pursuing a class action.”
In a statement sent to Nation’s Restasurant News, the administration of California Gov. Gavin Newsom said it was “deeply sympathetic to the difficulties facing restaurants” across the state.
“Initially, the state provided various forms of regulatory relief to restaurants, such as allowing the sale and delivery of take-out alcohol, granted fee relief by deferring the annual renewal fee for 30 days without penalty,” and swiftly approving temporary catering authorizations that allow for an expanded footprint for licensed alcoholic beverage control (ABC) businesses, giving them more room to serve customers while allowing for social distancing, âsaid the governor’s office. “ABC has maintained an open line of communication with the industry throughout and continues to do so in order to hear industry concerns and ideas as we respond to the pandemic while fueling our economic recovery.”
At the end of August, Newsom presented a safer path for restaurants to follow when reopening food service.
Under the Blueprint for a more secure economy, counties must meet certain COVID-19 reduction milestones before restrictions are relaxed. The framework is based on the average number of new coronavirus cases per 100,000 people per day, as well as the average positivity rate. The new guidelines make it difficult for larger, more populated counties to move quickly from one level to the next.
Los Angeles County remains in the “widely used” level, which limits restaurants to alfresco dining only.
Restaurants, especially independent full-service restaurants with limited off-site capacity, say indoor capacity restrictions below 50% make it impossible to realize a profit.
Kabateck said it was offensive for state and local authorities to charge fees for licenses and permits that restaurants cannot use in counties where indoor dining is still not allowed like Los Angeles.
Restaurants making complaints include 33 Taps, a sports bar on Sunset Boulevard in Los Angeles; Cowboy Star in San Diego County and Pizzeria Ortica in Orange County, which is now closed.
“Even when the restrictions are lifted, the devastating impact on the restaurant industry will last for years to come,” Jot Condie, president and CEO of the California Restaurant Association, said in a statement. âThe restaurants have not received any form of relief. Easing fees would allow establishments to stay open and keep vulnerable workers in employment. “
Before the pandemic, 1.4 million Californians worked in restaurants, according to the CRA. Since March, the association indicates that 900,000 to 1 million of these workers have been made redundant or put on leave. In a CRA survey at the end of August, 63% of restaurant owners said they had not received any rent relief.
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Update, October 27, 2020: This story has been edited to include a statement by California Governor Gavin Newsom.