FPLG COVID-19 RESPONSE
[UPDATE: June 30, 2020]
The fifth major COVID-19 bill, the HEROES Act, passed by the House six weeks ago, remains trapped in the Senate without action so far. Any action on it will occur after the July 4th recess.
Otherwise, there was movement in early June by Congress to extend and fix some of the problems with the Payroll Protection Act (PPP). There was also last-minute action taken on June 30th to extend the program for new applicants until August 8th. Other confusion and uncertainty about the PPP remains.
When Congress returns, we may see action on a bipartisan push to extend the charitable deduction to all taxpayers as well as a solution to hardships created earlier under the CARES Act for those nonprofits who self-fund unemployment insurance.
[UPDATE: May 19, 2020]
By the end of the third week of April 2020, Congress passed and the White House signed into law the fourth in a series of special legislative efforts to respond to the COVID-19 crisis. This $484-billion spending package restarts the small-business loan program that quickly ran out of funds. It also provides more money for health-care providers and for virus testing.
A fifth bill, the HEROES Act, has been passed by the House on May 15, 2020. It now moves to the Senate where it will likely face strong resistance. We’ll keep track of, and update, this developing story.
[April 1, 2020]
To date, the federal response to COVID-19 has unrolled in three phases.
Phase 1, H.R. 6704, the Coronavirus Preparedness and Response Supplemental Appropriations Act [enacted March 6, 2020] is the necessary supplemental appropriations bill of $8.3 billion to start the process of a massive relief program.
Phase 2, H.R. 6201, the Families First Coronavirus Response Act, [enacted March 18, 2020] creates new workplace obligations for employers and gives expanded aid to individuals. It includes a complex set of temporary paid leave mandates and employer reimbursement provisions, along with funding for free coronavirus testing, food nutrition security, and an extension of unemployment benefits.
Phase 3, the The CARES Act (Coronavirus Aid, Relief, and Economic Security Act) [enacted March 27, 2020] authorized more than $2 trillion in spending to inject cash into the economy through individuals, businesses, and nonprofits. It includes:
- Mandated paid sick and family leave for employees and refundable payroll tax credits for employers
- Three loan programs for organizations
- Above-the-line deduction (universal, for all individual taxpayers) for charitable contributions made in 2020
- Employee retention refundable tax credit
- Expanded unemployment and enhanced funding for social support programs
As a result of intense lobbying, the nonprofit sector was included in the final bill. The Charitable Sector: COVID-19 Relief and Economic Stimulus Package (March 18, 2020) National Council of Nonprofits (with hundreds of organizations as signatories).
Speaker Nancy Pelosi has announced that her caucus is already working to draft a Phase 4 bill that, if passed, will significantly increase the amounts given to beleaguered states and local governments whose budgets are being crushed by the demands of the COVID-19 response. It also could include aid specifically designed to bolster the nonprofit sector. Nancy Pelosi Is Already Talking About the Next Stimulus Bill for Coronavirus Relief (March 30, 2020) Emily Cochrane, The New York Times; see also Bipartisan Bill Would Provide $60 Billion to Nonprofits (March 30, 2020) Dan Parks, Chronicle of Philanthropy.
REFERENCES & RESOURCES
Senate extends small business coronavirus relief program (June 30, 2020) Chip Somodevilla, CNBC
How To Help Small Businesses In The Next Round Of Government Stimulus (June 30, 2020) Brian Thompson, Forbes
Act Now to Protect Nonprofits from Government-Induced Cash-Flow Strain (June 29, 2020) Tim Delaney, National Council of Nonprofits
PAYCHECK PROTECTION PROGRAM LEGAL UPDATE FOR TAX-EXEMPT ORGANIZATIONS (June 26, 2020) L. Lloyd Mullings, Jr., Esq., Goodwin Procter LLP
PAYCHECK PROTECTION PROGRAM LOAN FORGIVENESS SIMPLIFIED (June 2020) BDO United States
Go Big or Go Home: Steps Congress Should Take Now (June 10, 2020) Patrick M. Rooney, The Nonprofit Quarterly
Statement to the Senate Finance Committee on Nonprofits and Unemployment Insurance (June 9, 2020), National Council of Nonprofits
UPDATE: Payroll Protection Program Flexibility Act (June 4, 2020 FPLG) | May L. Harris, Esq., M.A., For Purpose Law Group Blog
With Millions Of Jobs At Stake, State And Local Government Associations Call On Congress To Approve Aid (May 20, 2020)|, National Governors Association, Press Release
Financial Aid Expected for Struggling Nonprofits: The HEROES Act and Accessing PPP Loans (May 18, 2020) William Powers, Esq., & Anna Tang, Esq., Nossaman LLP
House Passes Stimulus Bill With Sweeping New Benefits for Nonprofits (May 15, 2020) Dan Parks, The Chronicle of Philanthropy
Klobuchar, Schatz, Wyden, Brown Introduce Legislation to Help Nonprofits Hire Workers During Pandemic (May 15, 2020) Senate Press Release
House Democrats Unveil $3 Trillion Pandemic Relief Proposal (May 12, 2020) Emily Cochrane & Nicholas Fandos, The New York Times
A bipartisan group of former health officials seeks to sell a $46.5 billion coronavirus plan to the White House (April 29, 2020) Lev Facher, Stat
Letter, 28 U.S. Senators to Congressional Leadership (April 27, 2020)
- Senate passes $484 billion bill that would expand small-business aid, boost money for hospitals and testing (April 21, 2020) Erica Werner & Seung Min Kim, The Washington Post
Senate passes $484 billion bill that would expand small-business aid, boost money for hospitals and testing (April 21, 2020) Erica Werner & Seung Min Kim, The Washington Post
Nonprofit Track Reforms to the CARES Act (April 7, 2020) National Council of Nonprofits
What Nonprofits Should Know About the $2.2 Trillion Federal Covid-19 Aid (March 31, 2020) Deborah S. Smolover et al, The Chronicle of Philanthropy
Key CARES Act Provisions (March 30, 2020) Mark Micali, The Nonprofit Alliance
Initial Analysis of the Coronavirus Aid, Relief, and Economic Security Act (CARES Act) (S. 748) (March 27, 2020) National Council of Nonprofit
- Update: The CARES Act and Nonprofits (March 27, 2020) Linda J. Rosenthal, J.D., For Purpose Law Group Blog
- Update on Families First Coronavirus Response Act (March 26, 2020) Wagenmaker & Oberly Blog
- Nonprofits Included in COVID-19 Tax Bill (March 19, 2020) Mark Hrynwa, The Nonprofit Times
- What the Families First Coronavirus Response Act Means to Nonprofits (March 19, 2020) National Council of Nonprofits