A bipartisan duo of representatives from Texas to the United States on July 20 introduced a bill proposing government grants worth four months of certain operating expenses to support small businesses affected by the COVID-19 response.
Unlike the canceled loans from the popular Paycheck Protection Program, House Resolution 7671, the Small Business Comeback Act, essentially treats its payments of up to $ 50 million as a giveaway. There is no interest or maturity date involved.
The bill sponsored by U.S. Representative Filemon Vela, D-Texas, and Lance Gooden, R-Texas, establishes a program intended to act as the 9/11 Victims Compensation Fund. A special administrator appointed by the Secretary of the Treasury would set up the system and distribute the funds quickly. The president would appoint and the Senate would approve an inspector general to keep an eye on the administrator, and congressional leaders would also appoint a five-member supervisory board to keep an eye on everything.
Businesses could claim the lesser of four months of operating expenses or $ 50 million, with the caveat that monthly payments can be adjusted “to account for increases or decreases in that claimant’s income relative to the. last month “. For example, if car accidents are on the rise and your body shop has higher sales, the government will give you a little check next month.
“Small businesses in the 34th District of Texas and across the country are struggling to keep their doors open,” Vela said in a July 20 statement. “This bill aims to fill the gaps in previous legislation by providing immediate relief in the form of grants to facilities in need. As the uncertainty of this public health crisis continues to grow, I remain committed to doing so. to ensure that businesses in my community and across the country have access to the resources they need to get through these tough times, the Small Business Comeback Act is helping make that happen. ”
Within six months of the end of a covered period, the company reports its operating costs and revenues to the Special Administrator and must repay any “excess recovery compensation” in what is called a “final compensation. “.
Businesses can spend the money on payroll, health benefits, insurance premiums, mortgage interest, rent, utilities, disaster loan payments, PPP loan payments, interest on any debt before March 1 – and federal, state and local taxes.
“This legislation will bring a massive victory to small businesses, workers and consumers across America. It enhances the framework used in the Paycheck Protection Program because it is designed to provide freedom and flexibility to businesses that have been harmed by mandatory shutdowns, ”Gooden said in a July 20 statement. “We wanted to reduce the restrictions on how they could use the money. We’re not helping anyone if we cover them with red tape and new regulations as they try to get back on their feet. With this bill, we can take an important step in helping our economy meet one of the greatest challenges it has faced in a century.
Companies must keep 90 percent of the workforce in place when they apply for the fund. They must also restore the salaries and benefits of at least 75% of their workforce by March 1, four months after the end of the national COVID-19 public health emergency. Companies must also continue to pay employees who have tested positive for COVID-19 or who have been exposed to COVID-19 at work.
Bodybuilders who apply for the fund will have access to the money quickly. The special administrator must approve, deny, or request more information on a request within 30 days and authorize effective payment within the remaining five days.
But it is possible that the applicant will receive 25-75% of the total amount even earlier to help them cope. The law requires the special administrator to make a decision on such interim compensation claims within 15 days, with the money cleared within five days.
Anyone requesting monthly payments greater than $ 1 million can receive 25% of that amount in advance. Anyone looking for more than $ 100,000 but less than $ 1 million per month can apply up to 50% sooner, and anyone hoping for grants averaging $ 100,000 or less per month can apply for up to 75%. money.
The bill does not set an upper limit on who can apply. However, he orders the Special Administrator to prioritize funding for small businesses, independent franchises, women-owned or minority-owned businesses, low-to-moderate income businesses or rural areas and businesses that are suffering. more than others because of COVID-19.
Over 100 local and national business associations – including automotive aftermarket players like the Society of Collision Repair Specialists, the Automotive Service Association, and the Auto Care Association – have come together as America’s Recovery Fund Coalition and have advocated for a federal COVID-19 business subsidy initiative. The coalition expressed its enthusiasm on July 20 for Vela and Gooden’s approach.
“We wholeheartedly endorse and support the legislation introduced by Representatives Vela and Gooden to establish the Small Business Comeback Act,” AFRC Research Director Trevor Hanger said in a statement. “In this bill, we finally have a vehicle for cultivating a sustainable economic recovery. By prioritizing the hardest hit businesses and with greater flexibility in how the money can be used, the Return Act will help fill in the gaps left by previous programs and give business owners the immediate relief and the certainty needed to keep their doors open. As repeated closures and cancellations of reopening plans continue to disrupt the economy, this legislation will provide the stability main streets across America desperately need. We thank Representatives Vela and Gooden and call on Congress to pass the Small Business Comeback Act now. The longer we wait, the more costly – and perilous – inaction becomes. “
Be heard: Contact details for the Congress are available here.
“PRESS RELEASE: THE VELA CONGRESS AND GOODEN UNVEIL LEGISLATION TO CREATE A RECOVERY FUND FOR AMERICAN SMALL ENTERPRISES”
The office of US Representative Filemon Vela, July 20, 2020
“LEGISLATION REQUESTS FEDERAL SUBSIDIES TO SUPPORT COMPANIES DAMAGED BY THE PANDEMIC”
United States Stimulus Fund Coalition, july 2020
Left to Right: U.S. Representatives Filemon Vela, D-Texas, and Lance Gooden, R-Texas. (Provided by the Congressional Pictoral Directory, Gooden office)