COVID-19 Update

COVID-19 UPDATE: Senate Passes Over $470 Billion In Additional Economic Relief

We continue our efforts to keep you informed of key legal developments relating to COVID-19. Today, our update focuses on the over $470 billion in additional economic relief passed by the Senate for small businesses, hospitals and COVID-19-related testing. The House is expected to vote on the bill as early as Thursday, and the President is expected to sign it soon thereafter.

SBA LOANS: $370 BILLION

$310 Billion More for Paycheck Protection Program. The legislation increases the authorized funding for several programs established under the Coronavirus Aid, Relief, and Economic Security Act (“CARES Act”). Most notably, the legislation increases the amount of money authorized for the Small Business Administration (“SBA”)’s Paycheck Protection Program (“PPP”) by $310 billion, increasing the total amount available under the PPP to $659 billion.

Specific funds are authorized for non-traditional lenders and community development banks. Of the $310 billion:

• $30 billion is set aside for loans made by Insured Depository Institutions and Credit Unions that have assets between $10 billion and $50 billion; and
• An additional $30 billion is set aside for loans made by Community Financial Institutions, Small Insured Depository Institutions, and Credit Unions with assets of less than $10 billion.

$60 Billion for the Economic Disaster Funds. The legislation also appropriates an additional:

• $10 billion for Emergency Economic Injury Disaster Grants; and
• $50 billion for the Disaster Loans Program.

We understand that the amount sought under loan applications will far exceed even this expanded loan authority of $310 billion. Therefore, loan applications should be turned in very quickly and be diligently pursued.

We also are speaking with financial institutions interested in issuing PPP loans to minority-owned and women-owned businesses, including those with whom they do not currently have an existing banking relationship. Please reach out to us for more information.

HOSPITALS AND TESTING: $100 BILLION

The legislation also appropriates $100 billion to the Department of Health and Human Services (“HHS”) for allocating funds to hospitals and testing. Details include:

• $75 billion for reimbursement to hospitals and healthcare providers to support the need for COVID-19 related expenses and lost revenue. This funding is in addition to the $100 billion provided in the CARES Act.
• $25 billion for necessary expenses to research, develop, validate, manufacture, purchase, administer, and expand capacity for COVID-19 tests. Specific allocations include:
  • $11 billion for states, localities, territories, and tribes to develop, purchase, administer, process, and analyze COVID-19 tests, scale-up laboratory capacity, trace contacts, and support employer testing;
  • $1 billion provided to Centers for Disease Control and Prevention for surveillance, epidemiology, laboratory capacity expansion, contact tracing, public health data surveillance and analytics infrastructure modernization;
  • $1.8 billion provided to the National Institutes of Health to develop, validate, improve, and implement testing and associated technologies; to accelerate research, development, and implementation of point-of-care and other rapid testing; and for partnerships with governmental and non-governmental entities to research, develop, and implement the activities;
  • $1 billion for the Biomedical Advanced Research and Development Authority for advanced research, development, manufacturing, production, and purchase of diagnostic, serologic, or other COVID-19 tests or related supplies;
  • $22 million for the Food and Drug Administration to support activities associated with diagnostic, serological, antigen, and other tests, and related activities;
  • $825 million for Community Health Centers and rural health clinics; and
  • Up to $1 billion may be used to cover costs of testing for the uninsured.

The funding also includes $6 million for HHS’ Office of Inspector General for oversight activities. States, localities, territories, and tribes are required to provide plans on how resources will be used for testing and easing COVID-19 community mitigation policies.

We will continue to send periodic updates on topics that may be helpful to your businesses. If you have a particular issue that you’d like us to address or if you’d like to be removed from the distribution list, please let us know. For our previous updates, please see HERE.

Feel free to contact us with any questions.

Sincerely,
Gery Chico, Jon Leach, and Alpita Shah

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