Congress Approves New $484 Billion COVID-19 Relief Bill, More Funding for PPP

April 27, 2020

A fourth “interim” bipartisan relief package, the Paycheck Protection Program and Health Care Enhancement Act (H.R. 266), totaling $484 billion, is on its way to the President’s desk for signature. Yesterday, the House easily passed the measure, which would put over $300 billion into the depleted Paycheck Protection Program (PPP), support hospitals, and expand testing in the states. The Senate passed the legislation earlier in the week.

The focal point of the bill is the over $300 billion in new funding to aid struggling small businesses.  However, some believe that even this new round of funding will dry up quickly.

The bill includes:

• $320 billion in new funds for PPP
• Within that pool, $60 billion will go to community lenders and credit unions
• $60 billion for the Small Business Administration (SBA) Economic Injury Disaster Loan program, with $10 billion carved out for SBA Economic Injury Disaster Loan Emergency Advance, which provides a $10,000 advance as part of the larger loan that does not have to be repaid.

• $75 billion in grants to hospitals stretched by the surge of COVID-19 patients

• $25 billion to boost coronavirus testing. Of that $11 billion is set aside for states to scale up COVID-19 test capacity, trace contacts, and support employer testing.

The testing provisions require states to have plans for how they will use the resources for testing and mitigation, and the Administration is required to put together a strategic plan for providing assistance to States for testing.

The measure will not be the last one Congress passes to respond to COVID-19. Disagreements between Democrats and Republicans over next steps are also likely to continue. Democrats are already pushing for more funding for states to make up for shrinking revenue and heavy public pension obligations. Other items that could be considered in a subsequent package include infrastructure, broadband access, tax incentives for restaurants and other hard hit sectors of the economy.