U.S. Congressman Courtney Voices Concerns
On May 4, U.S. Congressman Courtney joined local chambers for a virtual forum with updates on federal coronavirus response. Concerns raised by chamber members will be given voice by Rep. Courtney as legislators negotiate the next phase in the federal assistance programs.
The Chamber of Commerce of Eastern CT, Greater Mystic Chamber of Commerce, and Norwich Area Chamber of Commerce invited members to participate in Monday’s video conference with the Congressman. He reviewed the series of legislative measures enacted to assist businesses and individuals, and he explained that the rapid response created a number of issues that require legislative remedy currently under discussion.
Member questions centered on the eight-week window for Paycheck Protection Program (PPP) loans, tax implications of those forgivable loans, and access to Personal Protective Equipment for healthcare facilities and reopening businesses.
“The input the we have gotten from people has really made an impact in terms of trying to get better public policy out there,” said Rep. Courtney.
The Current Legislative Scene
Responding to high demand for PPP loans initially approved March 27, legislation at the end of April allocated an additional $310 billion in new lending. As of May 2, 2.2 million new loans were made to small businesses for a total of $175 billion, with $135 billion in remaining to disburse. Rep. Courtney explained that funds are still moving fast and there is talk of additional funds being appropriated. The average size of the new loans is $79,000, and large, publicly traded companies, not intended to benefit from this program, are being given until May 7 to return the loans.
Economic Injury Disaster Loans (EIDL) received $50 billion in new lending authority and $10 billion additional funds for Economic Injury Disaster Grants. EIDL expanded to include agricultural businesses in recent action. SBA will open applications for those businesses.
Regarding unemployment compensation, Connecticut began disbursing the $600 weekly benefit to claimants. The self-employed are able to apply for benefits under Pandemic Unemployment Assistance. The process requires denial of benefits through Department of Labor’s filectui.com system first, followed by a PUA application, which will be available later this week.
Regarding employers, Rep. Courtney clarified the state will not penalize employers with higher premiums in the future based on claims made during the crisis. He also addressed employers’ ability to call employees back to work, which is explained in the CT DOL FAQs. Those with COVID or exposure are eligible to continue on unemployment. Those with other health issues or concerns about the suitability of the environment can appeal on a case-by-case basis.
Concerns with Existing Programs
PPP loans require maintaining payroll for the eight weeks following the issuance of the loans. Nonessential businesses and entertainment venues unable to open under state restrictions are poorly positioned to meet this requirement. Rep. Courtney said this was a concern in initial talks and will be revisited in new legislation currently in discussion: “You’re not alone in raising this issue and this district is not the only district in America that’s hearing this complaint about the eight-week window.”
Additionally, the program’s loan forgiveness provision opens businesses to taxes on the funds as income. Rep. Courtney said he will be pushing for legislation to remove the tax implications, similar to exemptions granted for mortgage forgiveness in the economic crisis in the 2000s.
Personal Protective Equipment is a serious concern as hospitals remain inadequately stocked and businesses evaluate reopening.
“In terms of PPE, this has been the most frustrating challenge and it’s one that we must fix if we are really going to safely reopen the economy in so many settings,” said Rep. Courtney. The state and private entities are competing for resources, but he reports some progress in Connecticut in getting the sought-after equipment. He sees collaboration with seven neighboring states to obtain resources as a smart move over relying on federal stockpiles.
Steps to Reopening the economy
The CARES 3.5 Act allocates $25 billion toward setting up testing programs, a critical step in safely reopening the economy with confidence from businesses and consumers. State public health departments will receive the funds for implementation, which he expects to be guided by a national strategy still being developed. It’s anticipated by some experts that a greater investment will be necessary.
Input from chambers and their members can be essential to creating a testing program for communities and employers. “If we don’t do it comprehensively, frankly, we are just putting the whole country and our communities back at risk,” he said.