FREE MEMBERSHIP Includes » ABL Advisor eNews + iData Blasts | JOIN NOW ABLAdvisor Gray ABLAdvisor Blue
Skip Navigation LinksHome / News / Read News


Senate Approves Additional Measures to Help Small Businesses

April 22, 2020, 09:05 AM
Filed Under: Economy

The U.S. Senate passed the Paycheck Protection Program and Health Care Enhancement Act, also known as the “COVID-19 3.5” relief package. The $484 billion package, which was originally designed to only be a $250 billion stopgap measure, is the second largest of the four coronavirus response bills Congress has passed so far.

The package includes $320 billion to replenish the Small Business Administration’s (SBA) Paycheck Protection Program (PPP), a loan initiative aimed at helping small businesses weather the economic fallout from the COVID-19 response. Lawmakers had allocated $349 billion to PPP as part of the $2 trillion CARES Act, but the program ran out of money less than 3 weeks after it was authorized. Of this amount, $60 billion would be set aside for smaller lending institutions such as credit unions and other community-based real financial institutions, with the goal of reaching underbanked businesses.

The package would also appropriate an additional $50 billion for SBA’s Disaster Loans Program Account and $10 billion for Emergency Economic Injury Disaster grants, while increasing the authorization level for the emergency economic grants from $10 billion to $20 billion. SBA would also receive more than $2 billion to cover salaries and expenses for federal employees.

Additional funding is also earmarked for hospitals and to enhance COVID-19 testing.

The interim relief package would provide an additional $75 billion to support local hospitals and health care providers by providing reimbursements for COVID-19 related expenses, lost revenue and public health services for uninsured Americans who have been infected by COVID-19. This new wave of funding is in addition to the $100 billion allocated under the CARES Act and will be distributed under the Public Health and Social Services Emergency Fund,

The U.S. Department of Health and Human Services (HHS) is in the process of developing formulas for additional targeted distributions to health care entities hit hard by the COVID-19  outbreak, namely rural providers, and important for counties – providers who predominately serve the Medicaid population.

The interim package would provide $25 billion for “necessary expenses to research, develop, validate, manufacture, purchase, administer and expand capacity for COVID–19 tests” to help effectively monitor and suppress the COVID-19 pandemic. Of the total amount allocated, the package would provide:

  • $11 billion in direct funding for states, localities and territories to scale up the administration’s COVID-19 testing, laboratory capacity, contact tracing and support employer testing
  • $225 million in direct funds to rural health clinics through grants and other mechanisms
  • Up to $1 billion to cover the cost of testing for the uninsured

Under this provision, the legislation also directs that these funds be allocated within 30 days of the bill’s enactment, and that $2 billion of the $11 billion for state and local funding be distributed using the Public Health Emergency Preparedness (PHEP) Fiscal Year (FY) 2019 grant formula under the Centers for Disease Control and Prevention (CDC). Of the remaining funds, $4.25 billion would be distributed using a formula based on COVID-19 cases and $750 million would be provided directly to tribes and tribal organizations.

Now that the package has passed the Senate, the House will vote on the bill this coming Thursday, April 23, where it is expected to pass.

Comments From Our Members

You must be an ABL Advisor member to post comments. Login or Join Now.