After months of negotiations, Congress finally passed a $900 billion stimulus package, bringing much needed aide to millions of Americans.
The nearly 6,000 page bill contains additional relief to small businesses, individuals and provides limited state and local government assistance.
Thanks to the US Chamber of Commerce and Representative Mike Garcia (R-CA 25), here is a top-line summary that we believe will be of interest to our members.
501(c)6 organizations are now eligible to apply
for the Paycheck Protect Program (PPP)
From the US Chamber of Commerce:
501(c)(6) organizations are eligible to receive a PPP loan provided:
- They are not a professional sports league or organized for the purpose of promoting or participating in a political campaign (Note: this will not impact chambers of commerce or trade associations);
- They do not employ more than 300 employees;
- They do not receive more than 15% of their receipts from lobbying activities;
- Lobbying activities do not compromise more than 15% of the organization’s total activities; and
- The cost of the lobbying activities of the organization did not exceed $1,000,000 during the most recent tax year that ended prior to February 15, 2020.
If an organization fails any of these tests they are NOT eligible to receive a PPP loan.
Similar rules apply to Destination Marketing Organizations.
Lobbying activities are not defined in the section. The Small Business Administration may provide a definition or guidance. Congressional staff have used information available in the 990 tax form when discussing the impact of the 15% lobbying activities limitation. Specifically, staff have compared the lobbying expenses reported on schedule C, Part III-B, Line 2 with the total expenses reported for the year (Page 1, line 18). (Note that these lines may be different if you are using a 990 form vs. 990EZ.)
Absent further guidance, organizations may wish to analyze their most recent 990 to determine whether they may be eligible to apply for a PPP loan and may wish to proceed with their lender if they believe they do qualify.
The bill also expands allowable uses for PPP funds and simplifies the loan process. We will be providing separate information on the other PPP changes.
Loans are now only $2million instead of the original $10million.
You can visit the Small Business Administration website when the loans become available to see where to apply: https://www.sba.gov/.
Other important highlights
From Representative Mike Garcia (R-CA 25):
- Provides $284.5 billion to reopen and strengthen the Paycheck Protection Program (PPP) for first- and second-time borrowers.
- Allows small businesses to receive a second PPP loan if the business has less than 300 employees and can demonstrate a revenue reduction of 25 percent.
- Increases the PPP loan amount for Restaurants and Hotels from 2.5x payroll to 3.5x, providing an extra month’s worth of payroll support
- Codifies rules for faith-based organizations and churches to ensure they keep their eligibility.
- Expands PPP eligibility to include 501c6s, destination marketing organizations (DMOs), housing cooperatives, newspapers, broadcasters, and radio stations.
- Simplifies the PPP loan forgiveness application for loans under $150,000.
- Allows employers to deduct PPP related business expenses and expands list of eligible expenses to include:
- Software, cloud computing, and other human resources and accounting needs
- Covered supplier costs
- Repeals a provision from the CARES Act requiring PPP recipients to deduct their EIDL advance from their PPP loan forgiveness amount.
- Extends the repayment period of deferred payroll taxes through December 31, 2021. Penalties and interest on deferred unpaid tax liability will not accrue until January 1, 2022.
- Supplies $2 billion to enhance the SBA’s existing government guarantee loan programs, increases the 7(a) loan guarantee to 90 percent, extends the $1 million loan limit for SBA Express Loans, and establishes a 504 Express Loan Program.
Families, Students, and Workers
- $600 stimulus checks per individual/child ($1200 per married couple).
- Capped at $75,000 gross adjusted income per individual ($150,000 for married couples)
- Must have a valid social security number to qualify
- Eligibility for stimulus checks will be determined using 2019 tax information
- $10 billion for the Child Care and Development Block Grant Program (CCDBG)
- This funding will be used to:
- Provide relief from copayments and tuition payments for families and to help reduce the child care provider’s costs for families
- Assist child care providers with fixed costs and operating expenses and assure facilities can stay open or reopen
- Provide child care assistance to health care sector employees, emergency responders, sanitation workers, or other essential workers.
- Stabilize the child care sector against increased operating expenses.
- This funding will be used to:
- $82 billion for the Education Stabilization Fund
- 5% allocated to the Governor’s Emergency Education Relief Fund for Governors to make emergency grants to education entities
- $2.75B will be reserved for private schools to help cover costs due to the pandemic
- 67% in the Elementary and Secondary Schools Emergency Fund (K-12)
- 28% in the Higher Education Emergency Relief Fund
- Unemployed individuals receive an additional $300/week from Dec. 26, 2020 to March 14, 2021.
- Extends and phases out Pandemic Unemployment Assistance (PUA) for self-employed and gig workers to March 14 through April 5, 2021 and averts another PUA “cliff” by allowing PUA recipients as of March 14 to stay on three more weeks before their benefits end.
- Extends and phases out Pandemic Emergency Unemployment Compensation (PEUC), which provides additional weeks when state unemployment runs out, to March 14 through April 5, 2021.
- Extends many CARES Act provisions to March 14, 2021, including interest-free loans to states, flexible staffing, and relief for non-profits and state and local government.
- Extends the tax credit through March 2021 for employers that continue to offer paid sick and family leave to their employees.
- Clarifies that personal protective equipment and other supplies used for the prevention of the spread of COVID-19 are treated as eligible expenses for purposes of the educator expense deduction.
- Increases SNAP benefits by 15% for six months, but does not expand eligibility, and requires the Secretary to issue a report on redemption rate and unexpended balances.
- Takes steps towards ending surprise medical bills
- Allows for independent arbitration and dispute resolution between the insurer and provider, leaving the patient out of the process
- Billed charges and government payer rates cannot be considered during arbitration.
- No threshold for arbitration.
- No government rate-setting.
- Includes good-government guardrails to encourage in-network agreements and prevent abuse and overuse of the arbitration process.
- Many of our physicians expected to see payment reductions in 2021. We prevent at least 2/3 of these cuts from going through by establishing:
- A three-year delay of a new add-on code that reduces reimbursement to specialty providers.
- A $3 billion across the board increase in physician payments in 2021.
- Three additional months of Medicare sequester relief.
- Ways to allow more providers to access Alternative Payment Model bonuses, giving physicians added incentives to provide high-quality and cost-efficient care.
- An additional $20 billion distribution from the Provider Relief Fund to help doctors who have had to reduce services.
- Three-year extensions of Medicare, Medicaid, and Public Health programs.
- Community Health Centers;
- Teaching Health Centers;
- Diabetes Programs;
- Eliminating DSH reductions through 2023.
- Helping save rural hospitals by letting them become a new Rural Emergency Hospital, which gives them the Medicare funding and flexibility to offer health care services their community needs.
- More specifically, the policy creates a new, voluntary Medicare payment designation that allows struggling Critical Access Hospitals (CAH) or small, rural hospitals with less than 50 beds to convert to a Rural Emergency Hospital (REH).
- This would preserve beneficiary access to emergency medical care in rural areas that would otherwise be left with nothing if their CAH or rural hospital closed.
- Reforming in a comprehensive way how Rural Health Clinics (RHCs) are paid.
- Allowing RHCs and Federally Qualified Health Centers (FQHCs) to furnish and bill for hospice attending physician services when RHC and FQHC patients become terminally ill and elect the hospice benefit.
- Expanding access to mental health service through utilizing telehealth which improves beneficiary access, particularly in areas low on mental health professionals.
- Allowing for Physician Assistants to directly bill Medicare, expanding beneficiaries access to care providers in areas lacking health providers.
- Fixing payment for oxygen and oxygen equipment that allows for increased affordability and access to those supplies in rural areas.
Vaccine Development and Deployment
- Nearly $20 billion for the production of vaccines and therapeutics, covering the cost for everyone who needs it.
- $8.75 billion for distribution of vaccines. This includes cold chain, advance freezers, and supporting state efforts.
- $3 billion for the national stockpile.
Transportation and Infrastructure
- $45 billion in transportation assistance.
- $15 billion for passenger air carriers to retain employees;
- $2 billion for airports;
- $2 billion for grants, loans, and loan guarantees to transportation services providers, including the motorcoach, over-the-road bus industry, and private school bus operators;
- $10 billion for state departments of transportation.
- Includes the bipartisan, bicameral Water Resources Development Act (WRDA) of 2020.
State and Local Government Assistance
- This bill ensures that failed Cities and States do not receive direct taxpayer funding.
- Extends the time period, from December 30, 2020 to December 31, 2021, in which State and local recipients of the existing U.S. Treasury distributed CARES Act Sec. 5001 Coronavirus Relief Funds (CRF) can make eligible pandemic expenses. This allows more of the already distributed $150 billion in CARES Act funds to be utilized.
- Under the CARES Act, Congress funded the Exchange Stabilization Fund (ESF) to stabilize our financial markets and provide a backstop that allowed the Fed to create targeted, temporary lending facilities for creditworthy borrowers. These temporary lending facilities did their job and are set to expire at the end of the year.
- $1.9 billion for the rip-and-replace program for communications providers with 10,000,000 subscribers or less to replace equipment in their communications networks that poses a national security threat.
- $300 million for broadband deployment program to support broadband infrastructure deployment to unserved areas, prioritizing unserved areas and rural areas.
- $250 million to the FCC to carry out the temporary telehealth pilot program authorized under the CARES Act.
- Establishes a $1 billion program at NTIA to support broadband infrastructure deployment, telehealth, and broadband adoption activities for federally recognized tribal nations.
We hope you find this information helpful. If you have any questions, please contact email@example.com.
In your corner,
Founding CEO, BizFed