Robert Gehrke: If Utah has pandemic relief money to spend, here’s where it should go

(Francisco Kjolseth | The Salt Lake Tribune) Robert Gehrke.

A little over a year ago, Ali Sabbah opened the third location of his popular Mazza restaurant, the largest of the three, in Sandy.

It took a few months to build up business there, and Sabbah said he had just turned a corner when COVID hit in March and he had to close all of his restaurants.

In September, he tried to reopen the Sandy location, but he had to close again when one of his cooks tested positive.

“I got to thinking, I can’t be doing this every time someone has symptoms,” he told me Friday, so he went back to just doing takeout orders, but it wasn’t feasible to stay open for five to 10 orders a night. He closed again, for good.

Now Sabbah has just one location left — his smallest restaurant in the 1500 East and 1500 South neighborhood. Where he used to have 80 employees, he’s now down to 10. He is fortunate, he told me, to have had three restaurants at one time and feels for those who are trying desperately to hang on to one.

And he is frustrated that there isn’t more help for businesses like his.

(Danny Chan La | Tribune file photo) Mazza Restaurant on 921 E. 900 South.

His story is unfortunately common. Since the pandemic broke out, 452 Utah restaurants have closed, Melva Sine, president of the Utah Restaurant Association, told me, and more than 16,000 industry workers have lost their jobs. Revenues this year are expected to be a few billion dollars below where they were last year.

Congress has been an abject failure, putting petty partisan squabbles before the suffering of millions of Americans.

But there may be a window for Utah to do more to lend a hand to sectors of the state economy, like restaurants, that have been devastated by the pandemic and the government’s public health orders.

Utah received $935 million in emergency funding through the federal CARES Act, funds that, as my colleague Bethany Rodgers wrote this week, expire at the end of the year. With that deadline fast-approaching, Utah still has more than $307 million yet to be spent.

What that means is either we’re going to see a massive spending spree in the coming days, or the state will have to return the funds to the federal treasury.

Many of those large pots of unspent money have been budgeted to important programs — for example, $4 million for at-risk housing and another $8.5 million of unspent funds out of $20 million budgeted for residential housing assistance.

But before Utah launches into a spending frenzy, it’s worth considering whether some of it can be reallocated to sectors that have yet to see any substantial recovery.

That goes well beyond restaurants.

Dave Morriss, president of the Utah Hospitality Association, said bars appear to have been “surgically targeted,” especially by the governor’s latest health orders banning sales after 10 p.m.

Many bars have already closed for good and others are barely hanging on. Morriss owns four Utah bars and said on the average night he is bringing in about a quarter of what he was a year ago.

He said he would have been better off financially if he had just closed down in March and stayed closed, “but I can’t do that to my employees. So we’ve taken it on the chin, we’ve drained our savings.”

Statewide, employment in the leisure and hospitality sector has fallen by more than 14% since last year, easily the hardest-hit sector of Utah’s labor market. More than 22,000 jobs have been shed.

Likewise, the arts and culture sector in the state lost 32,000 jobs, according to Crystal Young-Otterstrom, executive director of the Utah Cultural Alliance.

Utah has put considerable resources into the arts, she said, the third most of any state in the nation and, on a per capita basis, likely No. 1.

“I really thought this might be the death of this industry,” she said, “but that investment the state made has saved us.”

But, as I wrote back in September, there are live music venues, comedy clubs and private theaters that are still dark, dreaming of reopening someday, and hoping to hang on.

(Trent Nelson | Tribune file photo) The marquee at The State Room in Salt Lake City on Tuesday, April 21, 2020.

I’m not suggesting that the areas where the state is planning to spend the CARES Act money aren’t worthwhile. Many of them, like the housing programs I mentioned, absolutely are. But the state has been sitting on more than $300 million since the spring and during that span some needs have become more acute, others less so. Some parts of the economy have recovered, others continue to suffer.

But the reality is that most of the harm these businesses have endured is a direct result of government mandates — shutdowns, capacity limits, serving restrictions — that preserved public health. So it makes sense that we (the public) step in and mitigate as much of that harm as possible.

Before rushing into use-it-or-lose-it mode, the state should take another look at our priorities and see if we can’t add some of that money to the grant programs like Shop Utah designed to mitigate the harm.

Even if money is diverted to these struggling businesses, it would be, without a doubt, a temporary solution. Ultimately Congress has to do its job and throw a lifeline, not just to businesses on the brink, but ordinary Americans who will be losing benefits after the first of the year.

On that point, Sabbah put it better than I could.

“What I expect from our governor and our members of Congress,” he told me, “is to actually push for something on the federal level, instead of toeing the line … and not really creating a comprehensive help package. To me, it is very cruel and heartless and shows extreme callousness for those who are living in your state.”