Lawmakers Work to Get Economic Aid Flowing
The federal government is scrambling to deliver economic help to the American economy under difficult circumstances. A key step is getting the Small Business Administration’s (SBA) Paycheck Protection Program (PPP) up and running. SBA posted its interim final rule to govern the program last Thursday. There have been some glitches, but the SBA began granting loans last Friday, and banks are continuing to work this week to process additional loan applications. Information on the SBA’s loan programs and application information is located here.
The new rule increases the interest rate on loans from 0.5% to 1%, which should encourage banks to take part in the program. PPP is a key part of the “Phase III” recovery bill that NAIOP supported. It will offer $349 billion in forgivable loans so small businesses that are being harmed by the coronavirus pandemic can pay employees and cover rent.
NAIOP is also working to shape the ways in which future aid might be delivered in a “Phase IV” relief bill. The association joined other real estate groups in signing a letter last week that urges the creation of a federal COVID-19 recovery fund that provides tailored federal assistance to affected business and individuals in a streamlined manner, while also ensuring transparency and oversight. The fund would be modeled after the September 11 Victims Compensation Fund legislation, and it would compensate employees for wages they lost while unable to work because of COVID-19. It would also support the recovery of businesses through solvency assistance, among other important relief initiatives.
Elsewhere, House Speaker Nancy Pelosi last week unveiled a new committee on coronavirus. She said it will allow lawmakers to oversee all aspects of the federal response, especially spending. Under the terms of the $2.2 trillion “Phase III” bill, the federal government will start making deposits of up to $1,200 per person into taxpayer accounts later this month. Individuals who don’t have direct deposit will wait longer for their checks, the Associated Press reported.
Meanwhile, President Donald Trump stated that a “Phase IV” bill should focus on infrastructure and could invest as much as $2 trillion. Democrats have indicated infrastructure, aid to state and local governments, and a reinstatement of the state and local tax (SALT) deduction are potential items on their agenda. Congress is scheduled to return to Washington, D.C. on April 20.