SBA’s Restaurant Revitalization Fund Program Award Practices

This SBA OIG pandemic oversight report reviewed the U.S. Small Business Administration’s Restaurant Revitalization Fund application review and approval process. The objective of this review was to determine whether the controls SBA implemented to award RRF program funds in accordance with the Act and other applicable guidance were effective. 

SBA developed an implementation plan including a risk framework that was intended to reduce the risk of making improper payments and awarding Restaurant Revitalization Funds (RRF) to ineligible recipients. However, the plan did not include all program requirements and SBA did not always adhere to the plan or have sufficient controls to ensure program and statutory requirements were met by RRF applicants.

Beginning in May 2021, SBA received 278,300 RRF applications requesting $72.2 billion in relief payments. SBA approved approximately 101,000 applications and disbursed all $28.6 billion authorized for the program. After accounting for award amounts that we questioned for more than one eligibility requirement, we determined that SBA disbursed nearly $6.7 billion to applicants without sufficiently verifying they were eligible for award.

We made five recommendations for SBA to improve the use of data to reduce risks of making improper payments, and to review and recover funds awarded to applicants that did not meet eligibility requirements or received funds that exceeded statutory limits. SBA management agreed or partially agreed with all five recommendations.