Congress Passes COVID-19 Stimulus Package

By Joel Miller posted 04-03-2020 16:34

  

Last Friday, Congress passed the Coronavirus Aid, Relief and Economic Security (CARES) Act into law. The CARES Act appropriates funding for a number of Americans and their families, small businesses, health care programs and education:


Executive Summary

  • $1,200 for every taxpayer making $75,000 per year or less ($150,000 for couples filing jointly): Taxpayers making between $75,000 and $99,000 per year (and couples over 150,000) will receive smaller direct payments, and those making more than $99,000 per year will not receive a payment. Families will also receive $500 per child.
  • A temporary universal charitable deduction of up to $300: This deduction is available for cash-only non-itemized tax filings. It is available to both individuals and businesses.
  • The CARES Act provides for $377 billion in small business loans: Small businesses can apply for Small Business Administration (SBA) 7(a) loans and tax breaks.
  • A $425 million emergency allocation for SAMHSA: Of that $425 million, $250 million will be allocated to community behavioral health organizations and an additional $50 million will be allocated for suicide prevention programs. $100 million will be allocated for SAMHSA programs generally.
  • $4.3 billion for the CDC: This will help prevent, prepare and respond to COVID-19 nationally and internationally. $1.5 billion is allocated for cooperative agreements between states, localities, territories, tribes and Indian health organizations for preparedness and response activities related to COVID-19. $500 million is also included for public health data surveillance and analytics infrastructure modernization.
  • $945 million for the National Institutes of Health: This will support research to expand on prior research plans, including developing a better understanding of the prevalence of COVID-19 and its transmission. The funding will also support novel approaches to diagnosing the disease and will help develop countermeasures for the prevention and treatment of COVID-19 at various stages.
  • $15.5 billion for the Supplemental Nutrition Assistance Program (SNAP): This will ensure all Americans receive the food they need.
  • $8.8 billion for Child Nutrition Programs: This will ensure children receive meals while school is not in session.
  • $850 million for the Byrne-Justice Assistance Grant Program (Byrne JAG): This will allow state and local police departments and jails to purchase personal protective equipment (PPE) and other medical items. This funding will also support overtime for officers on the front lines of the pandemic.
  • A $150 billion Coronavirus Relief Fund: This will help state and local governments cover expenditures related to COVID-19. Each state will receive at least $1.25 billion.
  • A $45 billion Disaster Relief Fund: This will provide for the immediate needs of state, local, tribal and territorial governments to protect citizens and help them recover from the overwhelming effects of COVID-19. Governments may be reimbursed for medical response, PPE, National Guard Deployment, logistics coordination, safety measures and community services.
  • $1.032 billion for the Indian Health Service: This will support critically needed resources for the tribal health system. These resources include expanded support for medical services, equipment, supplies, public health education, tribally owned and operated Indian health care facilities, investments for telehealth services, expanded funding for purchased or referred care, electronic health records improvement and expanded disease surveillance by tribal epidemiology centers.
  • $453 million for the Bureau of Indian Affairs (BIA): This will support aide to tribal governments, welfare assistance, social service programs, expanded public safety and emergency response and teleworking.
  • $100 billion for the Public Health and Social Services Emergency fund: This will provide direct aid to healthcare institutions dealing with the front line of the crisis.
  • $100 million for the Re-Connect program: This will help ensure Americans living in rural areas have access to broadband.
  • $1 billion for the Community Services Block Grant (CSBG): This will help communities address the consequences of increased unemployment and economic disruption.
  • $13.5 billion for elementary and secondary education: This will support formula-grants to States, which will distribute 90 percent of funds to local educational agencies for use in coronavirus response activities such as planning for and coordinating during long-term school closures and purchasing technology to support online learning.
  • $3 billion for state governors to allocate to local educational agencies: This will allow governors, at their discretion, to allocate emergency support grants to local educational agencies that state educational agencies deem to have been most severely impacted by the coronavirus.

The coronavirus pandemic is a continually evolving crisis. Congress may pass additional stimulus and relief packages. AMHCA will continue to monitor the situation and update the field as appropriate.


Key Provisions of the CARES Act

FINANCIAL RELIEF FOR INDIVIDUALS, SMALL BUSINESSES, NON-PROFITS, AND GOVERNMENTS

  1. Direct Cash Payments –Authorizes a one-time, $1,200 cash payment for individuals making $75,000 or less ($150,000 for couples filing jointly) and $500 per child. According to federal officials, Americans should expect to receive direct deposits or checks in about three weeks (about mid-April).
  2. Emergency Small Business Loans – Provides emergency no-interest loans up to $10 million for eligible small businesses including non-profits with 500 or fewer full-time employees. Notably, the final legislation does not include an earlier provision that would have disqualified non-profits that receive Medicaid payments.
  3. State and Local Coronavirus Expenditure Funds – $150 billion in funding is appropriated to assist states, tribes, and local governments to cover necessary expenditures incurred due to Covid-19 including costs that were not approved in budget decisions and costs occurring between March 1 – December 30, 2020.

The CARES Act represents more than $376 billion in relief for struggling small businesses, which falls into two main buckets: Access to Capital and Small Business Support.

Access to Capital

  • $349 billion for forgivable loans to small businesses to pay employees and keep them on the payroll. These loans are open to most businesses under 500 employees, non-profits, the self-employed, startups, and cooperatives.
  • $17 billion for debt relief for current and new SBA borrowers. SBA will pay the principal and interest for the next 6-months on SBA-backed loans. Today, that would help 320,000 small businesses and any new borrowers in the 7(a) or 504 programs.
  • $10 billion in immediate disaster grants. Using the current economic injury disaster loan program, SBA can provide up to $10,000 to applicants within 3 days of applicants self-certifying they are eligible.

Small Business Support (https://www.sba.gov/)

  • Requires SBA to provide additional language resources to ensure small business owners can access the resources they need as easily as possible.
  • $265 million in funding for resource partners, including Small Business Development Centers and Women’s Business Centers (WBC) to provide training and counseling to businesses impacted by Coronavirus.
  • A waiver of the WBC matching requirement to alleviate the need to fundraise during the emergency.
  • $10 million for Minority Business Development Agency grants to train and counsel minority-owned firms impacted by Coronavirus.
  • $675 million to provide SBA with the resources it needs to staff up and administer these new and enhanced programs.
  • Finally, this will increase the number of small businesses that qualify for streamlined bankruptcy process, by nearly tripling the debt cap to $7.5 million to help American small businesses that will need to reorganized due to the COVID-19 pandemic.

Paycheck Protection Program
https://home.treasury.gov/system/files/136/Paycheck-Protection-Program-Application-3-30-2020-v3.pdf

Who is eligible?

Small and medium sized businesses up to 500 employees, non-profits, independent contractors and the self-employed. This includes churches but only to cover payroll costs of an associated business, like a thrift store.

How are loans made?

The SBA’s network of 2,500 7(a) lenders will be used to process these loans. There is also authority to fast track additional lenders to process and disburse these loans to reach as many small businesses as quickly as possible.

Are these grants?

Yes and No. The amount of the loan forgiven at the end of the year will be determined by how many employees were retained on the company’s payroll, up to 100 percent for full retention. There are safeguards built in to protect against employers gaming the program, as well as recognizing some employers will be forced to do temporary furloughs but bring their employees back on.

What is covered?

This bill allows firms to get a loan to cover up to 2.5 months of payroll and any new EIDL loan balances incurred because of coronavirus but cannot exceed $10 million.

How long does the program last?

The program is open until June 30, 2020, as it is intended for immediate payroll relief to ensure businesses do not do mass layoffs during this crisis.

UNEMPLOYMENT INSURANCE/WORKFORCE DEVELOPMENT

  1. Creation of Pandemic Unemployment Assistance (PUA) – Individuals that are no longer receiving regular pay from their job, nor qualify for state unemployment assistance, can qualify for PUA. This includes those who are self-employed, gig workers, and those who have exhausted their state or federal benefits. PUA is retroactive to January 27, 2020 and provides 39 weeks of eligibility through the end of 2020.
  2. Creation of Pandemic Unemployment Compensation (PUC) – For those receiving state Unemployment Insurance or PUA, the Federal government will provide additional payments of $600 per week, beginning the week the bill is signed, and ending on or before July 31, 2020.
  3. Expansion of “Work Sharing” Programs – Employers can voluntarily make an agreement with their state(s) to reduce employee hours to prevent layoffs, but employees would still be eligible for partial state UC benefit, and the state would receive $100 million.
  4. Unemployment Compensation Support for Nonprofits Organizations and State, Tribal, and Local Governments – During the national emergency, the government would pay for 50% of reimbursement to workers who are furloughed or laid off, instead of these employers needing to pay 100% of the unemployment compensation.

Health Care Provisions

NUTRITION SUPPORTS

  1. Supplemental Nutrition Assistance Program (SNAP) – $15.51 billion to fund additional anticipated SNAP benefits authorized in the second coronavirus package.
  2. Child Nutrition Programs – $8.8 billion in additional funding for Child Nutrition Programs to support school flexibility to ensure children receive meals while school is not in session due to coronavirus.
  3. Other Nutrition Programs
    1. Food Distribution on Indian Reservations (FDIPR) - $100 million for increased needs for food.
    2. Puerto Rico & U.S. Territories - $200 million for food assistance.
    3. Emergency Food Assistance Program (TEFAP) - $450 million for food banks and commodity distribution.
    4. Assistance for Food Producers - $9.5 billion to assist agricultural producers and farmers for schools, restaurant, and farmers markets.

CHILD CARE AND SOCIAL SUPPORT SERVICES

  1. Child Care – $3.5 billion in funding for the Child Care Development Block Grant (CCDBG) to support and maintain critical operations through continued payments and assistance to child care providers due to decreased enrollment or closures related to coronavirus. Additionally, funding is authorized to meet emergency staffing needs and ensure first responders and health care workers can access child care while they respond to the pandemic. $750 million in funding for Head Start to meet emergency staffing needs.
  2. Child Welfare – $45 million in funding for Child Welfare Services under Title IV-B the Stephanie Tubbs Jones Child Welfare Services Program which provides grants to states and tribes to develop and expand services to protect and promote the welfare of all children.
  3. Low Income Energy Assistance Program (LIHEAP) – $900 million in funding to assist low-income homes in paying for heating and cooling energy costs.

HEALTH SERVICES AND EXTENDERS

  1. Expansion of Medicare Telehealth Flexibilities – Flexibilities are expanded in order to ensure beneficiaries receive treatment form their home via telehealth providers and reduce exposure to Covid-19. Temporarily allows Federally Qualified Health Centers and Rural Health Clinics to serve as a distant site for telehealth consultations and requires HHS to issue clarifying guidance encouraging the use of telecommunications systems, including remote patient monitoring. Temporarily eliminates requirements that limit telehealth expansion to situations where a physician has treated a patient within the last three years.
  2. State Access to Enhanced Medicaid FMAP – This bill amends section 6008 of H.R. 6201 to delay the application of premium requirements. This will ensure states and territories are not ineligible for the increase of the FMAP percentage by 6.2%.
  3. Extension of the Temporary Assistance for Needy Families (TANF) Program – This bill officially extends TANF and other related programs including the Health Profession Opportunity Grants (HPOG), Healthy Marriage and Responsible Fatherhood, and Tribal TANF programs through November 30, 2020.

HOUSING & HOMELESSNESS

  1. Housing and Rental Assistance
    1. Temporary Foreclosure and Rent Moratorium – Beginning on March 18, 2020, federally- backed mortgage loans may not pursue foreclosure for a 60-day period. A multi-family borrower may not evict or charge any other rental or late fees for at least 30 days after they renter receives a notice.
    2. Tenant-Based Rental Assistance - $1.25 billion is appropriated for public housing agencies to maintain normal operations and take other necessary actions during this period. $850 million will be available for section 8 programs, including Mainstream vouchers, specifically.
    3. Public Housing Agencies (PHAs) - $685 million is appropriated in operating assistance to make up for reduced tenant rate payments.
    4. Elderly Persons and Persons with Disabilities - $50 million is appropriated to support housing stability for low-income seniors, and $15 million to support reduced tenant payment from those who are disabled.
    5. Housing Opportunities for Persons with Aids (HOPWA) - $65 million is appropriated for local communities, states, and nonprofit organizations for projects that benefit low-income persons with HIV/AIDS.
    6. Native Americans - $300 million is appropriated for Native American programs, including the Indian Housing Block Grant.
  2. Homeless Assistance – $4 billion to support state and local governments in addressing the virus in homeless communities.

The coronavirus pandemic is a continually evolving crisis. Congress may pass additional stimulus and relief packages. AMHCA will continue to monitor the situation and update the field as appropriate.

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