U.S. House Democrats Pass New Coronavirus Relief Plan
This week, U.S. House Democrats passed a new $3 trillion stimulus package in response to the coronavirus health pandemic.
The bill, H.R. 6800, known as the “Health and Economic Recovery Omnibus Emergency Solutions (HEROES) Act,” would provide nearly $1 trillion in funding for state, local and tribal governments that includes additional funding for virus testing.
The plan also calls for: a second round of economic impact stimulus payments of up to $1,200; and an extension of the $600 per week federal unemployment benefit payments.
Notably, the HEROES Act does not include liability protection for essential businesses.
Senate Majority Leader Mitch McConnell (R-KY) and many other GOP lawmakers have insisted that any new relief package should include certain protections for essential businesses that are open during the pandemic.
Among its Paycheck Protection Program (PPP) proposals, the HEROES Act would:
— Extend the covered period and related loan terms from June 30 to December 31, 2020;
— Extend the 8-week period to 24 weeks for purposes of using PPP loan proceeds for purposes of loan forgiveness;
— Eliminates the 75/25 rule on use of loan proceeds, which requires at least 75-percent of a loan be used for payroll costs; and
— Creates a safe harbor for borrowers who cannot rehire their employees in the prescribed timeframe. Notably, the legislation would also allow all nonprofits regardless of size to take advantage of PPP loans.
— The HEROES Act “enhances” the Employee Retention Tax Credit (ERTC) to encourage more employers to keep their employees on payroll and clarifies the interaction between the ERTC and PPP loans “to ensure borrowers can take advantage of both types of assistance.”
While the HEROES Act does not provide additional funding for the PPP (though it does provide $10 billion for Economic Injury Disaster Loan grants), it would provide certain funding carve outs based on size for the smallest of businesses eligible to receive PPP loans.
All in all, the proposed PPP changes seem likely to garner bipartisan support and largely appear to be well-positioned for inclusion in the next COVID-19 package that may ultimately be enacted.
It also includes $1.5 billion in new LIHEAP funding and $10 billion in SNAP benefits to states in response to an increased number of applicants and higher costs while increasing the minimum SNAP benefit from $16 to $30 per month and waive all work requirements for receiving SNAP benefits for the next two years.
It would grant a waiver to allow SNAP beneficiaries to buy hot and prepared foods from authorized retail stores. It would also provide $.45 cpg ethanol and advanced biofuels tax credit produced between January 1 and May 1, 2020.
Of major concern to PMAA is a proposed addition to the Fair Debt Collection Practices Act (FDCPA) called “Restrictions on collections of consumer debt during a national disaster or emergency.”
Anyone that is owed or collects on consumer debts would be subject to the FDCPA’s emergency restrictions (unless the debt arose post pandemic) and would be barred from collecting on their own debts.
Typically, the FDCPA only applies to third-party debt collectors that buy debt or delinquent accounts. This controversial issue is unlikely to get any traction but is something that PMAA will continue to monitor.
The HEROs Act represents the start to negotiations with Senate Republicans, some of whom have called the HEROES Act a “liberal wish list.”
Many Republicans are not fond of the thought of voting on another relief package and instead would like to focus on properly implementing the relief bills that have already passed Congress over the past couple of months.
PMAA expects a fierce and lengthy debate to ensue over the next couple of weeks as the two sides negotiate a deal.
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NewsClip:
AP: Democrats Push New $3 Trillion COVID-19 Relief Bill Thru U.S. House
