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BPAA Federal Policy Update - March 12, 2021

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COVID-19 Relief Updates 

  • Congress Passes, President Signs 5th Relief Bill, Impacts On Proprietors On March 10, 2021, Congress passed President Biden’s $1.9 trillion stimulus bill for Americans and small businesses that continue to face challenges with COVID-19. The President signed it a day after. The package is the fifth bill Congress has passed in response to the COVID-19 pandemic. Below is an overview of some key provisions for bowling proprietors, including the Restaurant Revitalization Fund, increased funding for PPP, tax incentives and $1,400 direct payments to individuals. Notably, the bill does not include Democrats’ hotly contested proposal to raise the U.S. minimum wage to $15 per hour. Here are some of the highlights of the small business aid in the package: 
    • Restaurant Revitalization Fund: The measure would provide $28.6 billion for a Restaurant Revitalization Fund to be administered by the Small Business Administration (SBA).  
      • Eligible recipients would include restaurants, bars, food trucks, caterers, “or other similar places of business in which the public or patrons assemble for the primary purpose of being served food or drink.”  
      • BPAA’s Government Affairs Committee has been engaged with the members of Congress that drafted this legislation and have intended for bowling proprietors to be eligible for these grants. Our key focus is to engage with SBA as they implement the grant program to ensure bowling proprietors that have restaurants and bars are deemed eligible. SBA will begin to implement this language once the relief bill is signed into law. 
      • Disqualified businesses would include those run by state or local governments, companies that manage more than 20 locations including affiliates, live venues seeking funding under the shuttered venues grant program, and publicly traded companies.  
      • Grant amounts would cover the difference between an entity’s revenue in 2020 compared with 2019. Awards would be reduced by amounts received through the Paycheck Protection Program. Aggregate awards made to an entity and its affiliates couldn’t exceed $10 million and would be limited to $5 million per location.  
      • Eligible expenses generally would include payroll costs, mortgage and rent payments, supplies, normal food and beverage costs, and paid sick leave.  
      • Initial Period: For 60 days following the measure’s enactment, $5 billion would be set aside for eligible entities with gross revenue of $500,000 or less in 2019. The SBA would also have to prioritize awards for small businesses owned by women, veterans, and socially or economically disadvantaged individuals during an initial 21-day award period.  
      • After Initial Period: After 60 days, $23.6 billion would be set aside for SBA to make grants available to any eligible entity regardless of annual gross receipts on a first-come, first-served basis.  
      • Grant Period: Funds could be used through Dec. 31, or a date set by the SBA that’s no later than two years after the measure’s enactment.  
    • Paycheck Protection Program:  The fifth package of relief would increase funding and expand eligibility for the program. It increases the program’s lending authority by $7.25 billion, to $813.7 billion, and appropriate the same amount for SBA to guarantee additional loans.  
    • Loan Forgiveness: The measure would expand PPP loan forgiveness to include payments made for premiums on behalf of individuals who qualify for COBRA health insurance continuation coverage. The change would apply to loan forgiveness applications received following the measure’s enactment.  
    • Economic Injury Disaster Loan (EIDL) program: Additional funding also would be made available for advance payments to eligible entities under the SBA’s Economic Injury Disaster Loan (EIDL) program. The measure would provide $15 billion for additional advance payments on a staggered schedule, as follows:  
      • $10 billion: Within 14 days of enactment, the SBA would have to start processing applications for covered entities that didn’t receive their full eligible advance payments under the year-end relief package. Those entities include recipients with 300 or fewer employees and economic losses of at least 30% over eight weeks compared with a similar period before the pandemic.  
      • $5 billion: Starting 28 days after enactment, the agency would begin processing applications for new supplemental payments of $5,000 to covered entities with 10 or fewer employees that had economic losses of more than 50% during the covered period. Starting 42 days after enactment, the SBA would begin processing applications for supplemental payments to entities with 10 or fewer employees that didn’t previously qualify.  


Labor & Minimum Wage Updates 

  • Labor Provisions in COVID Relief package Naturally, Congress’ $1.9 trillion COVID relief package included many measures that focus on labor and employment. Here are the highlights from bill: 
    • Minimum Wage Not Included: On March 1, Democrats backed off a plan to amend the COVID relief bill designed to push businesses toward raising worker wages after the Senate parliamentarian ruled that a proposed increase to the minimum would violate budget reconciliation rules. As such, Democrats were unable to muster even 50 votes the $15 minimum wage proposal in the COVID relief package. To get to 50 votes for a minimum wage hike in the future, President Biden will need to satisfy Senators such as Joe Manchin (D-WV), Jon Tester (D-MT), Kyrsten Sinema (D-AZ) and Angus King (I-ME).  
    • Workplace Safety: The measure would provide $200 million for the Labor Department ($100 million to OSHA) to carry out worker protection activities related to the Covid-19 pandemic. 
    • Direct Payments: The bill would provide another round of direct payments of as much as $1,400 for an individual, $2,800 for joint filers, and $1,400 for each qualifying dependent. 
    • Unemployment Extensions: The measure would modify and extend several pandemic-related unemployment benefits created under the CARES Act. It would extend the extra $300 Federal Pandemic Unemployment Compensation through Sept. 6. The bill would extend through Sept. 6 other CARES Act jobless benefits slated to expire on March 14, with changes that would include: 
      • Increasing the duration of Pandemic Unemployment Assistance (PUA) benefits to as long as 79 weeks, from 50 weeks, for individuals who don’t qualify for regular benefits. The program provides additional weeks of federally-funded unemployment benefits to eligible individuals who became unemployed as a result of the pandemic and are either self-employed, do not have sufficient work history to be eligible for a claim, or have exhausted other forms of unemployment insurance benefits. 
      • Extending to 53 weeks, from 24 weeks, benefits under the Pandemic Emergency Unemployment Compensation program for those who’ve exhausted regular benefits. 
      • The first $10,200 of unemployment benefits received would be excluded from certain taxpayers’ adjusted gross income beginning in 2020. The provision would apply to taxpayers with income that’s less than $150,000. 


Tax Updates 

  • Tax Provisions in COVID Relief package Congress’ COVID relief package also included many measures that focus on tax credits, but in a last-minute modification, House Democrats snuck in a few increases that target the wealthy. Here are the highlights from the bill: 
    • Tax Increases: Using the fifth COVID-19 relief package, congressional Democrats got an early start on their tax-increase agenda. House Democrats tucked a trio of little-noticed tax hikes on the wealthy and big corporations into their coronavirus relief package that together are worth $60 billion. One takes away deductions for publicly traded companies that pay top employees more than $1 million. Another provision cracks down on how multinational corporations do their taxes. A third targets how owners of unincorporated businesses account for their losses. 
      • If Democrats had exceeded their $1.9 trillion budget cap for the plan, the tax increases would not have worked. So, the increases they picked were both marginally met the procedural requirements and arcane enough to fly under the radar. However, this won’t be the last time the 117th Congress will see tax-increasing proposals come forward in major legislation. Read more about this at Politico. 
    • Employee Retention Credit: The measure would extend through Dec. 31, 2021, an employee retention credit established by the CARES Act. It had been expanded and extended to July 1. 
      • The measure also would expand eligibility for the credit to new startups that were established after Feb. 15, 2020, and companies if their revenue declined by 90% compared to the same calendar quarter of the previous year. The credit would be capped at $50,000 per calendar quarter for startups. 
    • Earned Income Tax Credit: The measure would expand the earned income tax credit for taxpayers without children for 2021 by increasing the credit percentage and phase out thresholds.  
    • Paid Leave Credits: The bill would extend through Sept. 30 tax credits for employer-provided paid sick and family leave, which were established under the Families First Coronavirus Response Act. The value of the credits would be increased to match an employer’s share of contributions to defined benefit plans and registered apprenticeship programs. The measure also would: 
      • Increase the wages covered by the paid family leave credit to $12,000 per worker, from $10,000. 
      • Cover as many as 60 days of paid family leave for self-employed individuals, instead of 50 
      • Expand the paid leave credits, including for self-employed individuals, to cover Covid-19 vaccinations or wait times for test results or diagnoses. 
      • Bar employers from receiving credits if their paid leave favors highly compensated employees, full-time workers, or employees based on tenure. 
    • Small Business Grants Exclusion: Advance funds provided through the Small Business Administration’s Economic Injury Disaster Loan program and restaurant grants created by the bill would be excluded from gross income for tax purposes. 


Political Updates 

  • The Celebs Are At It Again: This week, Matthew McConaughey confirmed he has eyes on Texas’ governor’s mansion. Meanwhile, President Trump touted retired NFL player Herschel Walker (R) for Senate over two other allies—former Sen. Kelly Loeffler (R) and former Rep. Doug Collins (R)—who both have political experience. Trump described a hypothetical Walker candidacy as “unstoppable, just like he was when he played for the Georgia Bulldogs.”  
  • Iowa District 2: The House Administration Committee tabled Rep. Mariannette Miller-Meeks’ (R) motion to dismiss former state Sen. Rita Hart’s (D) petition to overturn the results. 
  • Missouri Senate: State Attorney General Eric Schmitt (R) is expected to declare his candidacy soon. He'd be the first prominent Republican to officially announce a bid. 
  • Louisiana District 05: Trump endorsed University of Louisiana Monroe administrator Julia Letlow (R) in the special election to replace her late husband, Rep.-elect Luke Letlow (R). 
  • House Majority Forward “is launching a $1.4 million ad blitz this week to bolster nine vulnerable House Democrats who backed the” pandemic relief package.” 
    • The ads will support Democratic Reps. Cindy Axne (IA-03), Lauren Underwood (IL-14), Andy Kim (NJ-03), Antonio Delgado (NY-19), Matt Cartwright (PA-08), Lizzie Fletcher (TX-07), Vicente González (TX-15), Elaine Luria (VA-02), and Ron Kind (WI-03). More in Politico
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