Last week, Congress passed, and the President signed into law, interim relief legislation, the approximately $484 billion Paycheck Protection Program and Health Care Enhancement Act. The bill includes an additional approximately $322 billion for the Paycheck Protection Program (PPP), $60 billion for Economic Injury Disaster Loan (EIDL) program grants and loans, $75 billion for hospitals, and $25 billion for testing.
The Small Business Administration (SBA) began accepting PPP loan applications again on Monday and White House Press Secretary Kayleigh McEnany said the agency processed 450,000 loans totaling $48.5 billion in the first 24 hours. In the meantime, Treasury Secretary Mnuchin said that all PPP loans over $2 million will be audited before they are forgiven and that regulatory guidance implementing this procedure will be forthcoming. SBA also published new interim final rules for the PPP on requirements for promissory notes, authorizations, affiliation, and eligibility, additional criterion for seasonal employers, disbursements, and corporate groups and non-bank and non-insured depository institution lenders and updated PPP FAQs. Treasury published guidance on how to calculate maximum loan amounts by business type and SBA published a Procedural Notice providing guidance to approved lenders regarding the sale of participating interest in PPP loans.
On Monday, the President announced a strategy to expand COVID-19 testing. A Testing Blueprint describes the roles and responsibilities of the federal government, state, local, and tribal governments, and private sector and professional associations. A Testing Overview includes a three-stage process to expand testing.
Elsewhere, the President and federal agencies continue to take other steps to respond to the outbreak, including, but not limited to:
- President Trump signed an Executive Order invoking the Defense Production Act to designate meat and poultry processing plants critical infrastructure and compel them to remain open. The White House also published a fact sheet on the Order.
- The Federal Reserve announced an expansion of the scope and duration of the Municipal Liquidity Facility, which will offer up to $500 billion in lending to states and municipalities to help manage cash flow stresses caused by COVID-19. The Fed also announced it is expanding the scope and eligibility for the Main Street Lending Program by creating a third loan option with increased risk sharing by lenders for borrowers with greater leverage; lowering the minimum loan size for certain loans to $500,000; and expanding the pool of businesses eligible to borrow.
- The Treasury Department announced it has made $12.4 billion in initial payments to 93 air carriers and that it has determined that cargo air carriers that receive $50 million or less of payroll support and contractors that receive $37.5 million or less of payroll support will not be required to provide financial instruments as appropriate compensation for the financial assistance. The Department also published the application form for loans to businesses critical to maintaining national security, which may be submitted online beginning April 27 and are due by May 1.
- The US Postal Service said it revised its Hazardous, Restricted, and Perishable Mail regulations to support rapid deployment of COVID-19 diagnostic tests via mail during the public health emergency.
- The Department of Health and Human Services (HHS) launched a COVID-19 Uninsured Program Portal to allow health care providers who have conducted COVID-19 testing or provided treatment for uninsured individuals to submit claims for reimbursement.
- The Centers for Medicare and Medicaid Services (CMS) announced that it is reevaluating the amounts that will be paid under its Accelerated Payment Program and suspending its Advance Payment Program to Part B suppliers effective immediately in light of recent emergency relief to providers and suppliers.
- The Attorney General issued a memo on Balancing Public Safety with the Preservation of Civil Rights finding that the Department of Justice (DOJ) may have an obligation to address in federal court state or local ordinances that result in “an overbearing infringement of constitutional and statutory protections.”
A complete overview of both congressional and Administrative response efforts is available here and updated daily.
Senate Majority Leader Mitch McConnell (R-KY) confirmed this week that the Senate will return to Washington on May 4 as scheduled. House Democratic leadership initially made a similar statement, but on Tuesday announced that after consultation with Members and the Attending Physician, the House will extend its recess until further notice. The decision fuels continued uncertainty around the timing for Phase 4 coronavirus response legislation. Nonetheless, lawmakers continue to discuss priorities for upcoming legislation.
McConnell said this week that he will prioritize liability protections for frontline workers and reopening businesses and reiterated opposition to including infrastructure investment in COVID-19 stimulus legislation. This potentially puts him at odds with President Trump, who said again on Tuesday that he wants to pursue a major infrastructure package, but acknowledged many Republicans prefer a separate effort not tied to coronavirus relief. House and Senate Democrats continue to prioritize more funds for state and local governments and frontline workers.
- Federal Response Timeline
- New Congressional Research Service (CRS) Reports:
- Treasury and Federal Reserve Financial Assistance in Title IV of the CARES Act
- Small Business and COVID-19: Relief and Assistance Resources
- Tax Treatment of Net Operating Losses in the CARES Act
- The CARES Act: Tax Relief for Individuals and Businesses
- COVID-19 Related Loan Assistance for Agricultural Enterprises
- The Pandemic Response Accountability Committee: Organization and Duties
- Congressional Oversight Provisions in the Paycheck Protection Program and Health Care Enhancement Act
- Proposals for COVID-19 Congressional Advisory Commission: A Comparative Analysis
- Centers for Disease Control and Prevention (CDC)
- Johns Hopkins University Coronavirus Live Map
- KFF: State Data and Policy Actions to Address Coronavirus
Read more in McGuireWoods Consulting’s Emerging Technologies Washington Update.