On Wednesday, May 13, House Speaker Nancy Pelosi and fellow Democrats in the House of Representatives released their proposal for the next stimulus bill. The bill, titled Health and Economic Recovery Omnibus Emergency Solutions Act, otherwise known as the HEROES Act, is only the first step in the negotiation process around the next COVID-19 stimulus bill. This bill has not yet been negotiated with the Senate, with Republican leadership, or with the administration. We anticipate several weeks of negotiations ahead, with each entity having different and sometimes opposing priorities.
There is no guarantee that anything in this first proposal will make it into the next stimulus bill. That said, it is important to understand what is in the HEROES Act, because it will lay the groundwork for negotiations with the House. The House is expected to vote on this bill as early as Friday. After that, we anticipate negotiations will commence with Senate and administration leaders.
The HEROES Act focuses on a couple of key areas: Financial relief for states and local government, financial relief for individuals and families, increased testing and health care access, and a new Pandemic Premium Pay (also known as hazard pay or essential worker pay).
The Alliance for Strong Families and Communities, in partnership with our network, has been advocating heavily for nonprofit financial relief and critical funds for our communities to fill gaps that were not covered by the CARES Act.
After our strategic action sent network almost 5,500 letters to elected officials, we are thrilled that many of the priorities we have advocated for have been included in this first step.
Read our full summary and highlights below:
- Lifts the Employee Cap on the SBA Paycheck Protection Program (PPP) and Sets Aside Funds for Nonprofits – Creates a new set aside of funds, setting aside 25% of all funds specifically for nonprofits. Of that 25%, "not more than half" can go to nonprofits with more than 500 employees. There doesn't appear to be a cap on number of employees for nonprofits. It also extends the covered period for PPP loans to Dec 31, 2020. They could be stretched over 24 weeks instead of the eight weeks originally passed in the CARES Act. Business and organizations that receive PPP loans would be allowed to defer payroll tax payments. Coordination between the PPP and employee retention tax credit would be improved so that groups could use both.
- Main Street Loan Program – The Federal Reserve to would set up a low-cost loan option tailored to unique needs of nonprofits, including the ability to defer payments. This does allow loan forgiveness for nonprofits that serve low-income communities. We believe that nonprofits with more than 500 employees should be eligible for the program, even if they have received a PPP loan. However, if an organization has received or does receive a PPP loan in the future, it is not eligible for loan forgiveness
- Establishes a new Pandemic Premium Pay Program – $200 billion for essential workers on the frontlines of the pandemic. Each eligible worker would receive a pay raise equal to $13 per hour performed from Jan. 27, 2020 until 60 days after the final day of the public health emergency. Employees earning less than $200,000 per year can collect up to $10,000 in essential worker pay, while employees earning more than $200,000 per year can collect up to $5,000. An array of frontline human services professionals would be eligible including those working in child maltreatment, domestic violence, home care, behavioral health, therapeutic settings, residential care, housing, food bank, shelter services, education, and cleaning services. Organizations would apply for these grants to through the Treasury, based on the number of employees on the frontlines and other criteria. These funds would be passed through employers and into employee paychecks.
The Alliance has prepared a comprehensive summary of all key provisions for human service organizations. We are still analyzing legislation and will plan to update this with more detail and new interpretations over the coming days. For a more detailed summary, read the House of Representatives' section-by-section document.
Finally, the Alliance is excited to share this op-ed coauthored by Alliance President and CEO Susan Dreyfus and John MacIntosh of SeaChange Capital Partners, which was published this week in The Chronicle of Philanthropy. It advocates for financial relief for midsize and large nonprofits. Don't forget to share it with your networks and on social media using the hashtag #Relief4Charities.
Stay tuned for more advocacy opportunities in the next few days, to help ensure we keep key provisions in the final negotiation.