Waiting for mass vaccines, California cafe will 'have to hang on'

[December 31, 2020]  By Ann Saphir

SAN FRANCISCO (Reuters) - The months leading up to widespread COVID-19 vaccinations will be difficult for Farley's East, a cafe in Oakland, and other small businesses in California slammed by new state restrictions to fight record numbers of cases, pushing back any prospects for office workers returning to downtown buildings.

With vaccine shipments reaching local hospitals this month and a new round of government aid on offer in a $892 billion relief package signed into law Sunday, co-owner Chris Hillyard says he's more hopeful than he has been in a while.

"It felt like a 100 years, being in this lockdown," Hillyard said. "I am not looking forward to the winter, but I'm also feeling like we are going to get through this, at this point."

The pandemic has hit California hard. Early and long-lasting stay-at-home orders may have saved lives in the state, which has had fewer deaths per capita than all but 10 other states. Still, the current surge is filling hospital beds and straining resources.

The state's economy is reeling as well, its 8.2% unemployment rate the nation's sixth-highest. In November, California had 21.4% fewer restaurant employees than it had a year earlier, a loss of 315,600 jobs in the sector, far more than in any other state.

Farley's shut for about six weeks at the start of the crisis, then reopened and rehired 15 of its 40 staff in late April thanks to a government grant that covered payroll until mid-summer.

After the grant was spent, Hillyard and his wife Amy kept things going with funding from Washington-based charity World Central Kitchen, which contracts with more than 100 Oakland restaurants to fix meals that are distributed to people in the community.

In recent weeks, Farley's built a brisk holiday season business in gift boxes of coffees, teas and books. But the season ends soon, and World Central Kitchen plans to wind down its Oakland operations next month, after injecting about $22.5 million into the community through its meals program.

Marin Hillyard, 14, prepares a meal-to-go at Farley's East in Oakland, California, U.S. April 16, 2020. The cafe temporarily closed during the shelter-in-place but returned first to sell meals-to-go and later reopened its cafe on April 29, 2020 with the help of the paycheck protection program, part of the $2.3 trillion economic relief package passed by Congress in late March. Picture taken April 16, 2020. REUTERS/Nathan Frandino/File Photo

Oakland's downtown remains nearly empty of the workers who were once Farley's main customers and sales are about 30% of pre-crisis levels, Hillyard says.

That's not enough to pay the bills, especially with colder, rainier months ahead and the promise of extended stay-at-home orders likely to keep even more customers away.

The pandemic relief package, with $284 billion in funds for small businesses, provides a reprieve.

Hillyard is already talking with his lender about tapping into that newly replenished paycheck protection program again. The forgivable loans are designed to cover about two months of payroll, plus overhead, for small businesses.

Though he still expects to lose money in coming months, the program "will probably help us - and probably a lot of other restaurants - to survive," Hillyard says.

He will use banked savings to cover losses until spring, when he hopes more people will be out and about as vaccines become more common.

Until then, Hillyard says, "we are just going to have to hang on."

(Reporting by Ann Saphir; Editing by David Gregorio)

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