The United States Congress has reached an agreement on a fourth coronavirus economic relief package, which aims to send additional help to small businesses and hospitals struggling amid closures, as well as to expand support for the tests. The package was approved by the Senate Tuesday night and then goes to the House for a vote. President Donald Trump has offered public support, indicating that he will sign it.
US $ 310,000 million for additional loans from the Paycheck Protection Program
The original $ 349 billion allocated for Small Business Paycheck Protection Program (PPP) loans sold out in less than two weeks due to high demand and was criticized because restaurant chains they were able to access the funds. Some say it would have been sold out even earlier if there hadn’t been so many glitches with the Small Business Administration’s loan processing system. This will free government hardship grants money for low income families you never pay back for anything Lawmakers have now agreed to add another $ 310 billion to the fund. It is not yet clear how quickly that second tranche of money would be available. Once the law is passed, it will likely take an additional day before the SBA can reopen the program, according to a banking industry source. It’s also unclear how long it will take before that extra money runs out. There is a large backlog of applications in the process by companies that have already applied for it. The expectation is that it could be sold out in less than 10 days.
$ 60 billion for small lenders and community banks
The new agreement reserves $ 30 billion of additional funds from the Paycheck Protection Program for loans made by federally insured lenders with assets between $ 10 billion and $ 50 billion. And it would set aside another $ 30 billion for loans from community finance institutions and federally insured small banks and credit unions with assets below $ 10 billion.
$ 10 billion for economic damage disaster loan grants
The deal would increase funding by $ 10 billion for economic damage disaster loan grants. Like the Paycheck Protection Program loans, the seed funding for these grants quickly dried up. The promise had been that small business owners could get essentially up to $ 10,000 within three days of applying directly from the SBA website. Money from the Economic Injury Disaster Loan does not have to be repaid if it is used to maintain payroll, cover paid sick leave and pay other debt obligations. But if a small business owner obtains both a grant and a forgivable Paycheck Protection Program loan, the forgiveness of the latter loan would be reduced by the amount of the grant. But nearly every small business owner CNN Business spoke to in recent weeks said they had applied for a disaster loan early, but many had yet to receive money from it, and in some cases, had not even received confirmation. That their requests had been received.
Hospitals get more money
Hospitals and healthcare providers would get an additional $ 75 billion to reimburse them for coronavirus-related expenses, such as buying additional personal protective equipment and expanding the number of beds they have. It would also go to compensate hospitals and providers for the loss of income, mainly due to the suspension of surgeries and elective procedures. This has hit hospitals hard from a financial point of view, forcing some to lay off workers or cut employee wages and hours. The third stimulus package, approved in late March, created a US $ 100 billion funds for these purposes, which hospitals called a “good first step,” implying that more would be needed in a future bill. The initial $ 30 billion allocations from that fund has angered some hospitals because it was distributed based on Medicare payments, not based on the number of coronavirus patients.
More money for testing
The bill would provide an additional $ 25 billion to expand coronavirus testing capacity, which many states and public health experts say is still lacking in the United States. The bill would give $ 11 billion to states, localities, territories and tribes to develop, purchase, administer and analyze tests, as well as to expand laboratory capacity, perform contact tracing and support employer testing. Trump and the governors have argued over the adequacy and accountability of the tests in recent days. The president maintains that the federal government cannot take care of testing in local communities. Governors, on the other hand, say they lack supplies to run the tests. The bill requires states, localities, territories, and tribes to submit plans for how resources will be used to test and facilitate community coronavirus mitigation policies. The package would also send the US $ 1 billion to the Centres for Disease Control and Prevention (CDC) for surveillance, expansion of laboratory capacity, search for contracts and other needs, and the US $ 1.8 billion to the National Institutes of Health for developing, improve and implement tests.
Another $ 1 billion would go to the Biomedical Advanced Research and Development Authority for coronavirus testing and supplies. In addition, the legislation would provide up to US $ 1 billion to cover the costs of testing for the uninsured and would award US $ 825 million to community health centers and rural health clinics, which often have to treat the uninsured. The Trump administration refused to reopen federal exchanges for the Affordable Care Act for the Uninsured, instead of saying the federal government would cover the costs of hospitals testing and treating the uninsured through a separate fund of $ 100 billion. This fourth package added another $ 75 billion to that pool of money.
Help for state and local governments or food stamp recipients
Democratic lawmakers wanted to provide an additional $ 150 billion for state and local governments, which also suffer big drops in revenue and higher spending on public health. Several have already started laying off workers and have warned of big budget cuts ahead. The third aid package, approved in late March, established a $ 150 billion fund for state and local governments to cover expenses related to fighting the coronavirus outbreak. Democrats also pushed for a 15% increase in the maximum benefit for food stamp recipients. While previous aid packages provided some additional funding for federal nutrition assistance, they did not increase the limit on the monthly amount that the nation’s approximately 37 million food stamp participants receive. Food stamp enrolment is expected to rise as millions of Americans lose their jobs as businesses close their doors to slow the spread of the coronavirus.