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The money for small business loans approved by Congress is not enough for restaurants and food service companies in expensive cities, according to Christopher Pappas, founder and CEO of food supplier The Chef’s Warehouse.
The Coronavirus Aid, Relief, and Economic Security (CARES) Act has to be "much bigger," Pappas said Monday.
"I think what they passed was great, but it's not big enough," Pappas told FOX Business’ Maria Bartiromo. "It's going to have to be much, much bigger, especially for the culinary world."
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Pappas said businesses in high-tax, high-rent cities, such as Los Angeles, Miami and New York, are already skating on thin margins and shouldn't risk taking on any more debt.
"With a moving target … nobody really understands when restaurants will be back to full occupancy," he said. "They can't take the chance to take a loan and have more debt. It has to be a grant and it's going to have to be very long term."
A closed sign hangs in the window of a shop in Portsmouth, N.H., March 25. (AP Photo/Charles Krupa)
The CARES Act’s contribution to rent and utilities, Pappas said, just "isn’t enough money” for big-city business. Pappas believes SBA and the Department of Treasury will have to take another look at the Act and reevaluate, and give small businesses some time to get "back on their feet."
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Pappas argued the government also needs to look into food service, since the industry employs millions of people and is the "lifeblood" of food supply to restaurants.
"I think there's a lot of work to do," he said. "They've gone big and I think they're going to have to go bigger."