Congress is making some progress on a new COVID Relief Bill. If it advances, it would represent the first significant stimulus action since the CARES Act was passed in March of 2020. We don’t want to predict anything, as things are subject to change, however based on the progress we are seeing, we believe our clients should understand the provisions being proposed. Here is a link to the proposed Summary Framework of the Bipartisan Emergency COVID Relief Act of 2020 shared on December 9.
Here are some of the key items being proposed in the new bill:
Paycheck Protection Program: The bill would expand the PPP program to allow some businesses to receive an additional loan (eligibility would be limited to small businesses with 300 or fewer employees that have sustained a 30% revenue loss in any quarter of 2020). This bill would reverse the IRS decision and allow the deduction for expenses that result in PPP loan forgiveness. PPP forgivable expenses would be expanded to include supplier costs and investments in facility modifications and personal protective equipment (PPE) to operate safely. The PPP loan forgiveness process would be simplified for borrowers with PPP loans of $150,000 or less. New PPP funds would be dedicated for smaller borrowers and underserved communities. Funding would also be expanded for independent live venue operators affected by COVID-19 stay-at-home orders. Funding would be added for SBA loan products to increase guarantees on SBA 7(a) loans and reduce fees on 7(a) and 504 loans.
Unemployment Assistance: The bill would extend the pandemic unemployment insurance programs (created under the CARES Act) by 16 weeks. Those are set to expire in December and would, under the new relief package, now expire in April of 2021. The bill would also extend the federal supplement unemployment insurance benefits at half the former rate ($300 per week) from the end of December to April 2021.
Student Loan Extensions: The bill would extend federal student loan forbearance provisions through April 30, 2021 (currently set to expire on January 31, 2021).
Rental Assistance: The package would extend the eviction moratorium until January 31, 2021, which is a 1 month extension.
Liability Protections: The framework suggests that there is “Agreement in principle as the basis for good faith negotiations.” Providing liability protection for corporations has been a sticking in negotiations.
Stimulus checks were not included in the proposed package. The bipartisan agreement is still working its way through the legislative process and the provisions outlined above may not make the final bill, however we will provide an update as things progress.