An interim COVID-19 relief bill was passed by the Senate yesterday and now heads to the House for a vote, which is expected to take place on Thursday.
According to CNN, the total price tag of the bill is approximately $484 billion, which is on top of the $2 trillion Coronavirus Aid, Relief, and Economic Security Act, a $192 billion relief measure and another $8.3 billion plan Congress approved last month.
The new bill would authorize the Small Business Administration’s Paycheck Protection Program to spend an additional $310 billion. The program, which operated for less than two weeks before running out of funds, authorized up to $349 billion in forgivable loans to small businesses to pay their employees during the COVID-19 crisis. The SBA said it had approved more than 1.66 million loans for more than $342 billion.
Of the $310 billion authorized for the Paycheck Protection Program, $60 billion will be set aside for smaller lending facilities, including “community financial institutions, small insured depository institutions and credit unions with assets less than $10 billion,” according to the bill. There also will be $10 billion in grants under the Emergency Economic Injury Disaster Loan program, $50 billion for disaster recovery loans and $2.1 billion for additional salaries and expenses for the Small Business Administration.
President Donald Trump has indicated he will sign the bill when it reaches his desk, tweeting:
“I urge the Senate and House to pass the Paycheck Protection Program and Health Care Enhancement Act with additional funding for PPP, Hospitals, and Testing. After I sign this Bill, we will begin discussions on the next Legislative Initiative with fiscal relief to State/Local Governments for lost revenues from COVID 19, much needed Infrastructure Investments for Bridges, Tunnels, Broadband, Tax Incentives for Restaurants, Entertainment, Sports, and Payroll Tax Cuts to increase Economic Growth.”
Last week, AAHOA President/CEO Cecil P. Staton called on Congress to take immediate action to provide additional funding to the Paycheck Protection Program.
“Hospitality is a signal industry. It was the first to feel the economic effects of COVID-19 as the virus caused the cancellation of thousands of events and meetings, and we know it will be the last to return because of barriers to travel. Hotel owners and their employees are among the hardest hit by the economic effects of this pandemic,” he said. “COVID-19 is placing American small businesses in such distress that the largest stimulus programs in the nation’s history ran out of money in less than two weeks. Congress must immediately authorize additional funding for this crucial capital lifeline and direct the Small Business Administration to permit lenders to continue submitting applications into a queue so that valuable time is not lost while we wait for Congress to act.”
According to Moody’s VP Rebecca Karnovitz, the Senate bill provides additional support to small businesses.
“The PPP will provide liquidity relief for businesses that are able to secure loans through the program,” she said. “Nonetheless, many small businesses that are currently closed or operating at reduced levels could still struggle to remain financially viable, even if lockdowns are progressively lifted over the coming weeks. A wave of small business bankruptcies would weigh on a recovery in employment and economic activity.”