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BPAA Federal Policy Update - June 18, 2021

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Latest on Small Business Funding

  • Lawmakers push for $60B refill of the Restaurant Revitalization Fund Last week, sponsors of the Restaurants Act introduced a new bill to infuse $60 billion into the Restaurant Revitalization Fund. RRF closed on May 24, just three weeks after opening for applications. The fund received 362,000 applications during that time frame for a total of $75 billion in funds, far exceeding its allotment of $28.6 billion, the National Restaurant Association wrote in an email to Restaurant Dive. 
    • The Restaurant Revitalization Fund Replenishment Act of 2021 is endorsed by both NRA and the Independent Restaurant Coalition, as well as both Republican and Democrat House and Senate lawmakers.
    • Restaurants have hoped the RRF would be refilled since before the fund even opened, and this proposed legislation is a beacon of hope for operators that continue to struggle despite federal and local grants and Paycheck Protection Program loans. Since the start of the pandemic, the industry has lost more than $280 billion in sales and over 90,000 restaurants have closed permanently or long-term, according to NRA.
    • Read more at Restaurant Dive.

 

  • Judges Halt Race and Gender Priority for Restaurant Relief Grants Lawsuits brought by white business owners challenging a policy that prioritized applicants for pandemic relief grants on the basis of gender and race have thrown the federal government’s Restaurant Revitalization Fund into turmoil. Tens of thousands of applicants who expected an easier path through the $28.6 billion aid program are now stuck in limbo, and nearly 3,000 restaurant owners whose grants were approved have been told they can’t be paid. The money is running out fast: The program has distributed $27.5 billion to about 100,000 applicants, an agency official said on Monday. Read more at the NYT.
     
  • Small Business Restaurant Owners Reeling from Grant Rescindment Washington, D.C. (June 17, 2021) – Today, the National Restaurant Association sent a letter to the U.S. Small Business Administration (SBA) outlining the impact of their recent action to rescind 2,965 Restaurant Revitalization Fund (RRF) grant approvals. The affected owners, all part of the priority application group established as part of the grant program, were left reeling last week after the SBA announced that they would withdraw their grant approvals and reappropriate the funds to other applications. Read more here.

 

  • SBA opens Targeted EIDL Advance grant to all eligible small businesses The Small Business Administration is now urging all eligible small businesses to apply for its Economic Injury Disaster Loans and its Targeted EIDL Advance grant program. The move comes months after the agency began inviting small businesses who had previously been shortchanged by the grant program in March and April 2020 and gradually expanded that to all small businesses that had applied for grants through the end of the year. SBA Administrator Isabel Guzman had told the Business Journals recently the agency planned on opening up the program in early June. Read more here.

 

Unemployment & Labor

 

  • Some congressional Democrats who forcefully advocated for emergency unemployment benefits earlier this year are now signaling they’re willing to let a weekly supplement expire in early September. The shift in tone from Democratic lawmakers comes as 26 states, nearly all led by Republican governors, have moved to cut off the $300 benefit early, arguing it has discouraged many residents from seeking employment, particularly for jobs that end up paying less than the combined state and federal benefits.
    • Any effort to extend the benefit beyond its September expiration date would likely run into fierce political headwinds, not to mention an economy that’s struggling with both inflation and modest job growth.
    • House Budget Committee Chairman John Yarmuth (D-Ky.) said Wednesday that the politicization around the weekly supplement would make it difficult to renew.
      • “I wouldn’t be surprised if it doesn’t get extended. But we’ll see over the next couple of months what the job reports show,” he said.
    • On the Senate side, Finance Committee Chairman Ron Wyden (D-Ore.) also signaled the challenges to renewal.
      • “I’ve long said pandemic unemployment programs should be tied to economic conditions on the ground,” said Wyden, who has been a major advocate for the expanded benefits during the pandemic.
      • “If that had been done in the [COVID-19] rescue plan there wouldn’t be these concerns about the arbitrary September cut off. But the way the budgetary effects of these policies are scored is an obstacle,” he added. Read more at the Hill.

 

  • Biden Regulatory Playbook Revives More Active Government President Joe Biden laid out his first regulatory to-do list Friday, detailing his ambitions to dramatically expand the scope of the federal government’s involvement in education, healthcare, and the environment, among other areas. Tougher regulation to prevent discrimination in health care, boost wages for tipped workers, and provide relief for student loan borrowers is on the agenda that outlines each federal agency’s regulatory priorities for the coming months. The agenda includes agency plans to revise Trump-era rules on pollution, greenhouse gas emissions, and public lands. And it includes proposals that would strengthen protections for immigrants who arrived in the U.S. as children alter which asylum-seekers are allowed into the U.S. Read More at Bloomberg

 

  • OSHA issues a new Covid safety rule, but only for the health care industry, optional for other employers The Occupational Safety and Health Administration announced a rule on Thursday outlining steps that employers must take to protect workers from the risk of Covid-19, but it will apply only to the health care industry, not to other high-risk workplaces, as the Biden administration initially indicated. Mr. Walsh, whose department includes OSHA, said the administration was issuing optional guidance to employers outside health care that would focus on workplaces in the manufacturing, meat processing, grocery and retail industries. See the summary of changes posted June 10 on OSHA’s website here.

 

  • Pick for OSHA Head, Two Other DOL Nominees OK’d by Committee A Senate committee approved President Joe Biden‘s nominees for three U.S. Labor Department leadership roles, including occupational safety chief, advancing them to the full chamber, the panel announced Wednesday. The Senate Health, Education, Labor, and Pensions Committee voted 13-9 for Doug Parker to lead the Occupational Safety and Health Administration; 14-8 for Rajesh Nayak to run the department’s policy office; and 18-4 for Taryn Williams to head the Office of Disability Employment Policy. Read More at Bloomberg

 

Tax and Budget

 

  • The Hill – Centrists gain leverage over progressives in Senate infrastructure battle: Centrists have gained leverage in the Senate battle over an infrastructure package after 11 more senators backed a $974 billion infrastructure framework:
    • Twenty-one senators in all are supporting the proposal, which is much smaller than what the White House and liberals prefer—11 Republicans, 9 Democrats and an independent who caucuses with Democrats.
    • Liberals who were calling on fellow Democrats to “cut bait” only a few days ago now grudgingly acknowledge they will have to review the details of what the centrists will come up with before deciding their next move.
    • And centrist Democrats are touting the support of their 11 Republican colleagues for the five-year spending plan, arguing it is a strong indication that it can pick up 60 votes and pass the Senate outside the budget reconciliation process. Read more here and here.

 

  • Pelosi Confronts Loud, Ticking Clock as Senators Mull Biden Plan President Joe Biden’s quest to enact his $4 trillion economic agenda enters a turbulent new phase Monday as the U.S. House comes back into session and Democratic representatives ramp up pressure on the Senate to produce a bipartisan compromise or stop prolonging the effort. Addressing the demands of progressive Democrats to go it alone will be a major challenge for Speaker Nancy Pelosi and her top lieutenants in the coming weeks.  Read More at Bloomberg

 

  • On the topic of inflation and the spending… Fed chief brushes off fears of extended inflation: Federal Reserve Chairman Jerome Powell said Wednesday that the U.S. is on track for a strong rebound from the coronavirus pandemic even as the economy hits inflationary speed bumps on the path to full recovery.
    • Powell spoke to reporters after the Federal Open Market Committee (FOMC) — the Fed’s monetary policymaking arm — announced that it would hold its baseline interest rate range steady at 0 to 0.25 percent and continue to purchase $120 billion in Treasury and mortgage bonds each month During the press conference, Powell brushed off fears that the recent inflation surge would force the Fed to slam on the brakes with an interest rate hike sooner than expected. 
    • The Fed chief said that while price increases could continue to heat up, the unrepaired damage to the U.S. economy from a year of COVID-19 lockdowns made a dangerous inflation spiral unlikely.
      • “If we see inflation expectations or inflation moving up in a way that is really materially above what we would see as consistent with our goals and persistently so, we wouldn't hesitate to use our tools to address that,” Powell said. “We do not expect that, though. That is not our base case and in that we're joined by many other forecasters,” he added. I’ve got more here.
    • The background: The debate over inflation comes as President Biden and most congressional Democrats are looking to spend big on an infrastructure package, prompting opposition from Republicans, who argue that more stimulus will only drive prices higher
    • The U.S. is still down more than 7 million jobs from February 2020. Millions of Americans have still been unable to return to the workforce due to pandemic-related constraints, and many are fearful of returning to work with roughly 50 percent of U.S. adults not vaccinated against COVID-19.
    • Even so, higher than expected increases in several annual measures of inflation have deepened concerns among Republican lawmakers and fiscal hawks about the combination of monetary and fiscal stimulus
      • “Isn't it incumbent upon the president, the U.S. secretary of Treasury, and even us in the Congress to take inflationary risk seriously by pursuing responsible fiscal policies, not just expecting the Fed to clean up a mess after the fact?” asked Sen. Chuck Grassley (R-Iowa) of Treasury Secretary Janet Yellen during a Wednesday hearing before the Senate Finance Committee.

 

  • New Markets Tax Credit Report Details Job Creation Amid Pandemic The New Markets Tax Credit supported 272 projects with nearly $3 billion in funds last year, according to a new report from a coalition advocating for the credit’s expansion and permanence. The Treasury Department awards the tax credit to program applicants who then sell them to investors to finance lending and development in low-income areas. Congress extended the temporary tax credit under a December 2020 law, but it will still expire at the end of 2025. Read More at Bloomberg
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