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Ritzy Restaurant Where CA Gov. Newsom Was Caught Dining Received Millions In COVID-19 Relief Funds: Report
Signage for the French Laundry restaurant in Yountville, Napa Valley, California, operated by chef Thomas Keller and known for being one of the few restaurants in the United States to earn three Michelin stars, November 26, 2016.
Smith Collection/Gado/Getty Images

The posh Napa Valley restaurant that hosted a dinner party last month that landed California Democratic Governor Gavin Newsom in hot water reportedly received millions in COVID-19 relief funds.

KGO News’ investigative unit, the I-Team, reports, “Yountville’s highly acclaimed French Laundry received multiple loans through the Paycheck Protection Program, totaling more than $2.4 million, according to an ABC7 analysis of newly-released data from the Small Business Administration.”

The loans were disbursed by SBA-certified lenders earlier this year to provide a direct incentive for small businesses to keep their employees on the payroll during the pandemic-induced recession.

After photos emerged showing Gov. Newsom dining at the French Laundry with a large group on Nov. 6, he was accused of hypocrisy for failing to comply with various health guidelines his administration pushed on the rest of the state. The incident has accelerated an ongoing recall campaign against the governor.

The I-Team reports:

The French Laundry received two loans that were both approved on April 30, 2020. According to the SBA, the first loan was for more than $2.2 million to retain 163 employees. The second loan was for $194,656 to retain five employees.

ABC7’s analysis found the company received 17 times more than what the average Bay Area restaurant received. …

The I-Team analyzed thousands of California loans released by the SBA that show wealthier, big businesses are often getting access to loans before small mom and pop owners. Out of all the approved loans in California, 91 percent of larger restaurants with 300 or more employees got their loan approved in April versus only 52 percent of smaller restaurants with 100 or fewer employees.

Several small businesses across the country that desperately needed financial support struggled to obtain PPP loans. According to the Los Angeles Times, the program stopped taking applications in August after directing $68.6 billion to 623,000 California companies.

The I-Team spoke with Laurie Aaronson, a financial consultant serving hundreds of restaurants across the Bay Area. She has spent most of the year helping her clients navigate through a PPP application process often described as intimidating and confusing by smaller, family-owned operations.

“Clearly those who had established banking relationships with banks that chose to participate at least in the early stages…those who had access to financial advisors, accounts, and attorneys to make sense of the application received the loans,” she said.

As the I-Team notes, “At the French Laundry, you can reserve an exclusive outdoor culinary dining experience starting at $450 per person or a White Truffle and Caviar dinner for $1,200 per person, according to reservation services online.”

ABC7 said the outlet reached out to the French Laundry for comment “multiple times” but has not yet heard back.

Recipients of PPP loans are eligible for forgiveness if they use at least 60% of the funding to keep workers on the payroll. Those that do not meet that requirement must repay the loan(s) at a fixed 1% annual percentage rate.

Related: Millions In COVID-19 Relief Loans Went To Companies Partially Owned By California Democratic Gov. Newsom

Related: Photos Emerge Of Gov. Gavin Newsom At Ritzy Restaurant Allegedly Failing To Comply With Health Guidelines

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