Michigan to allow indoor dining at 25 percent capacity as COVID eases

Jan. 28, 2021: Michigan restaurants still likely to struggle after reopening amid COVID

Michigan’s indoor dining industry will be able to resume serving customers Feb. 1, although capacity will be capped at 25 percent — with a limit of 100 people —  and doors will have to close at 10 p.m.

The news was greeted with relief by the struggling industry, though with concern that tight capacity restrictions may make it difficult for some establishments to turn a profit.  

Gov. Gretchen Whitmer on Friday announced the end of the nearly two-month “pause” that banned indoor dining amid broader COVID restrictions on schools, workplaces and sporting events during a surge in cases.

The new order, from Robert Gordon, director of the Michigan Department of Health and Human Services, lasts three weeks. Whitmer did not rule out that new restrictions could be enacted if the state’s coronavirus case counts climb as officials worry about a new, more transmissible variant that has been found among three people in Ann Arbor.

“It is our hope and intention and it is totally within our capability to do this safely and then be in a position to actually expand” to greater customer capacity, Whitmer said. “That's the goal. That goal is dependent on our ability to keep the spread of the virus down. We have shown we're capable of it. We've shown we know how to do it.”

The reopening covers bars that serve food and restaurants; nightclubs will still be closed for now, officials said.

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Reopening is “good, if overdue news,” Justin Winslow, president and CEO of the Michigan Restaurant & Lodging Association, said in a statement.

But other operators and some state lawmakers decried the 25 percent capacity limits, arguing that restaurants have borne the brunt of restrictions even as coronavirus cases have dwindled.

“Gov. Whitmer makes clear with her actions today that she does not care about family businesses,” said Senate Majority Leader Mike Shirkey, R-Clarklake.

“Granting restaurant owners an arbitrary and meager percentage of operating capacity will not help them bring their businesses back from the brink of failure,” he added. “If the governor thinks 25 percent is adequate, perhaps Gov. Whitmer should only receive 25 percent of her salary.”

He and other leaders in the Republican-controlled Legislature have threatened to withhold approval for Whitmer appointments and other measures unless she compromises on COVID-19 restrictions. 

Reopening is “good, if overdue news,” Justin Winslow, president and CEO of the Michigan Restaurant & Lodging Association, said in a statement. 

State health officials ordered the ban because indoor dining is considered less safe during the pandemic because of how the coronavirus spreads: through close-contact between people, typically indoors, and among people from multiple households.

Those same fears prompted state officials to warn people not to hold big holiday gatherings and many complied.

Whitmer: ‘The pause has saved lives’ 

Gordon ordered the first three-week “pause” to start Nov. 18, as the second wave of the coronavirus pandemic was hitting Michigan hard. It was extended twice as Michigan hospitals filled with COVID-19 patients; more than 3,200 people died of the disease in December alone, the second worst month for COVID-19 deaths after April.

But since November, case counts have plummeted and the state’s rate per 100,000 people is among the lowest in the country, as is the percent of COVID-19 tests that are coming back positive — on Thursday, the state reported just 4.9 percent of over 50,000 tests were positive, the lowest rate since Oct. 21. A lower positive rate indicates more control of community spread of the virus. 

And for the first time in three months, the number of patients being treated for confirmed or suspected COVID-19 fell below 2,000 Thursday; it peaked at 4,326 on Nov. 26.

Whitmer attributed that stark — and welcome — change to the pause and the restrictions. Without it, a state health official said this week, deaths could have hit 250 a day in December rather than the 150 it did reach.

“The pause to save lives worked,” Whitmer said. “Our actions saved our hospitals from getting overwhelmed. Our actions have saved lives.”

Even with the pause, over 14,000 people in Michigan have died of COVID-19 since March and more than 544,000 have been infected with the coronavirus.

Building tensions as industry wanes  

As the rate of new cases fell rapidly, the dining industry was dismayed by the state’s first and then second extensions of the ban on indoor dining in December and earlier in January. 

Tension over the restrictions mounted late last year, with the MRLA in November suing Gordon, while some restaurant owners opened in violation of state regulations. As of Tuesday, the Michigan Liquor Control Commission has suspended the licenses of 37 establishments. 

More recently, Whitmer has received bipartisan pressure to reopen restaurants over the past week as the Jan. 31 expiration of the restrictions approached. A group of owners, led by Saddleback BBQ in Lansing, signed a letter urging reopening while also thanking her for addressing statewide COVID-19 safety concerns. On Thursday, the Ottawa County Board of Commissioners sent its third request to Whitmer to allow the indoor-dining restrictions to lapse, with Chairman Roger Bergman writing, that restaurants are "stretched to or beyond the breaking point."

The restaurant industry has made several proposals to the state to avoid closing altogether. Among them were reduced capacity and a curfew to control the hours that establishments — and in particular, bars — would be open. 

With indoor dining closed, many owners continued to try to find ways to keep serving customers. Some added igloos or tents to increase outdoor dining capacity, while others boosted temporary heat sources to try to attract patrons despite winter temperatures.

The state’s leisure and hospitality industry lost about 60,000 jobs in December from a month earlier as the restrictions took effect, dropping to 229,000, according to the Michigan Department of Technology Management and Budget. A year earlier, an estimated 434,000 people were employed in the industry.

Since the pandemic began, an estimated 1 in 6 of the 17,000 restaurants in Michigan has closed.

Michigan is currently one of 10 states with full or partial shutdowns of indoor dining, but the unemployment rate here, 6.9 percent, is higher than neighboring states including Ohio, Indiana and Wisconsin, which allow indoor dining and whose unemployment rates are below 6 percent. Illinois also has a ban on indoor dining; its unemployment rate is 6.9 percent.

Enough to make ends meet? 

Michigan’s restaurant operators say they’ll need the coming week to prepare for opening Feb. 1. Many operators — particularly those offering full-service dining, which accounts for 40 percent to 50 percent of the state’s restaurants — will have to weigh the start-up costs of reopening at 25 percent capacity versus the potential revenue, said Steve Loftis, owner of Harbor Restaurants in Grand Haven.

Paying staff to clean, ordering perishables and stocking menu items and liquor can cost tens of thousands of dollars.

“At 25 percent, it’s going to be a very difficult challenge to run enough revenue and cover expenses to make it worthwhile opening,” Loftis said. He said he hasn’t made a decision on the timing for opening his five-restaurant group, which includes fine dining at Snug Harbor.

Still, Loftis said, the industry appreciates that the ban on indoor dining will be lifted and it is hopeful that it will remain open.  Next, he said, restaurateurs and bar owners hope to see a plan from the state for criteria that would allow increased customer capacity. 

Winslow said he’s hoping for more steps from the governor that, he said, would restore confidence in the dining industry. That includes prioritizing vaccinations for the broader hospitality industry and establishing clear metrics for phased reopening to 100-percent capacity of indoor dining. 

“The hospitality industry and its sizable workforce has suffered far worse than its peers from this pandemic,” Winslow said. “... [It] also stands to gain the most from a proficient and expedited vaccination schedule.”

Grand Rapids Chamber President and CEO Rick Baker joined other business advocates in calling for clarity on further reopening.

“The pause has had a devastating impact on this industry and its workforce, putting many workers on unemployment and small businesses on the edge of bankruptcy with an uncertain future,” he said in a statement.