Reed Helps Deliver a Big Boost for RI Small Businesses in COVID-19-Relief Agreement
WASHINGTON, DC – From restaurants and bars to Main Street shops, retailers, and theaters, small businesses are struggling due to COVID-19 and U.S. Senator Jack Reed (D-RI) says the new bipartisan COVID-relief package contains multiple initiatives to help small business stay afloat and keep their employees and customers safe. In addition to small business support, the far-reaching agreement also includes targeted assistance for health care providers, COVID-19 testing and vaccines, schools, unemployment insurance, and a variety of other programs.
“This overdue COVID-19 relief bill contains significant wins for Rhode Island families and small business,” said Senator Reed. “Small businesses have a big impact on our economy and this will provide targeted assistance, direct support, and tax relief that is essential to help small businesses survive and recover. We didn’t get everything Rhode Islanders want or need, but there is a lot in here to help businesses, their employees, customers, and suppliers. The bill will get money into the hands of folks who can spend it and should provide an economic boost at a critical time.”
Key Reed-backed provisions in the agreement that will help small businesses include:
Extending and improving the Paycheck Protection Program (PPP) to better serve small businesses: The bill includes $284.5 billion for Paycheck Protection Program loans, a $26.8 billion increase over the Republican proposal from early December. It also expands eligibility for so-called 501(c)(6) nonprofits, such as local chambers of commerce, local newspapers, TV, and radio broadcasters that were left out of the original program. Businesses that experienced “severe” revenue reductions can apply for a second loan. And it also allows PPP borrowers to claim tax deductions for covered business expenses. To date, Rhode Island small businesses have received over $1.46 billion in federal PPP funding.
Extending the EIDL lifeline: Provides $20 billion for targeted grants through the Economic Injury Disaster Loan (EIDL) program administered by the U.S. Small Business Administration (SBA). Small businesses may use these grants to help meet their financial obligations and operating expenses. To date, Rhode Island small businesses have received over $607 million in EIDL funds.
Delivering targeted assistance to small businesses in struggling industries: Includes $15 billion for the Save our Stages (SOS) Act, which Senator Reed cosponsored, to provide dedicated assistance for industries that rely on large gatherings, including restaurants, concert venues, and theaters.
Supporting the smallest, most vulnerable businesses: To help “very small” businesses and underserved communities, the bill includes $12 billion set aside for capital investments through community-based lenders like Community Development Financial Institutions (CDFIs) and Minority Depository Institutions (MDIs).
Providing debt relief for small businesses: Provides $5.5 billion for debt relief payments and enhancements for SBA lending programs.
Supporting underserved small businesses and nonprofits: Provides a $15 billion set-aside for lending through community financial institutions, including Community Development Financial Institutions and Minority Depository Institutions.
Putting more money in the pockets of customers and families: While the CARES Act included $1,200 in direct payments for people who met income requirements, the new law will provide $600 to each eligible person, and depending on a household’s circumstances, could mean $2,400 for a family of four. It also extends federal financing for work sharing and enhances unemployment insurance for out-of-work Americans by providing an additional $300 per week through March 14, 2021.
The legislation must be approved by both the U.S. House of Representatives and the U.S. Senate before being sent to the President’s desk to be signed into law.