Government Affairs Update: Phase IV COVID-19 Relief Bill Passed, Signed into Law
On December 21, Congress passed a roughly $900 billion coronavirus stimulus package, a $1.4 trillion spending package to fund government programs through fiscal year 2021, and a host of other miscellaneous provisions. Although he initially opposed the $900 billion dollar stimulus bill, President Trump eventually signed it on December 27.
CLDA’s Government Affairs team has been pushing three legislative priorities on Capitol Hill since the passage of the CARES Act earlier this year. We worked regularly with Congressional staff to line up co-sponsors of bills they introduced in support of our priorities in both the House and the Senate in order to fix problems with the Paycheck Protection Program (PPP) and keep it as an economic lifeline for our members.
Priority One: Addressing deductibility of business expenses paid for with PPP loan money
The year-end stimulus law included a provision clarifying that eligible business expenses may be deducted even if paid for with PPP loan funds that are forgiven. This reverses earlier rulings from the Treasury Department that would have disallowed the deduction of business expenses paid with forgiven PPP funds.
The year-end stimulus law included a provision clarifying that eligible business expenses may be deducted even if paid for with PPP loan funds that are forgiven. This reverses earlier rulings from the Treasury Department that would have disallowed the deduction of business expenses paid with forgiven PPP funds.
Priority Two: Allowing for a second draw of PPP loans
The new stimulus law provides for a second PPP loan, which is now available for small businesses and non-profits with 300 or fewer employees that can demonstrate a loss of 25% of gross receipts in any quarter during 2020 when compared to the same quarter in 2019 (totaling 2.5 times the average monthly payroll up to $2 million).
The new stimulus law provides for a second PPP loan, which is now available for small businesses and non-profits with 300 or fewer employees that can demonstrate a loss of 25% of gross receipts in any quarter during 2020 when compared to the same quarter in 2019 (totaling 2.5 times the average monthly payroll up to $2 million).
Priority Three: Keeping the PPP adequately funded and available to all CLDA members who need it
The new law extends and expands the PPP for small businesses by providing an additional $284 billion for forgivable loans.
The new law extends and expands the PPP for small businesses by providing an additional $284 billion for forgivable loans.
Early in 2020, CLDA organized a coalition of 29 other organizations to fix, improve, and fully fund the PPP. We have since been coordinating and strategizing regularly with other organizations who put together their own groups. Our combined advocacy and coalition-building efforts culminated in a coalition letter with more than 600 signatory organizations, representing millions of small businesses and tens of millions of American workers delivered to Congressional offices. You can read the letter here.
CLDA has been at the forefront of the effort to push through a fix to the PPP deductibility problem, along with our other top priorities. We are happy to see success in these efforts. We will continue to make sure that the PPP is there for as long as our members need it.
