Washington Snapshot: House Passed H.R. 7010 That Would Relax Restrictions on the Paycheck Protection Program


In This Week's Edition of Snapshot...


Congress IconNews from the Hill

  • Regarding the next coronavirus relief package: After the passage of the The Heroes Act, H.R. 6800 (116) by the House last week, Senate Majority Leader Mitch McConnell (R-KY) continues to take the position that it is too early to make a final judgment about how much or when a bill might pass the Senate and wants to assess the national pandemic response needs later in June. He told local news in Kentucky he “would like to measure how much the opening up of the economy begins to restore our economic situation.”
  • On Thursday, the House overwhelmingly passed H.R. 7010 (116) that would relax restrictions on the Paycheck Protection Program, the emergency government-backed loans designed to avoid mass layoffs at small businesses during the pandemic. The bi-partisan legislation gives businesses seeking full loan forgiveness more time to spend the money — 24 weeks instead of eight — and lower the minimum amount that must be spent on payroll to 60 percent instead of 75 percent. The vote will put pressure on the Senate to act when they return to Washington next week. Lawmakers are treating the issue with increasing urgency because businesses will soon enter the phase where they will apply for loan forgiveness.
  • The House held several hearings this past week related to COVID-19:
  • A group of House Ways and Means Committee Democrats sent a letter to Treasury Secretary Steve Mnuchin expressing concern about taxpayer confusion over stimulus payments delivered by prepaid debit cards. News reports in several states have indicated people receiving the cards have been confused and worried they are a scam, and in some cases, they’ve been thrown away. The IRS says about four million of the cards were being sent. Among other questions, the group asks for an explanation for selecting some taxpayers for the cards rather than paper checks. The payments are worth up to $1,200 per individual and $500 for each eligible dependent.
  • House Majority Leader Steny Hoyer (D-MD) announced Thursday that no more votes are expected in the House next week. An updated legislative calendar — in addition to more information about floor consideration for “must-pass measures” like fiscal 2021 appropriations bills — will be forthcoming.

Congressional Research Service

The nonpartisan CRS has concluded that Department of Education Secretary Betsy DeVos’ guidance from April that excludes undocumented students and other students ineligible for federal student aid from receiving emergency grants under the CARES Act, H.R. 748 (116) makes the department vulnerable to legal challenge. CRS concludes the guidelines reflect an “unpersuasive” interpretation of the law and is likely to be invalidated by a court. The memo obtained by Politico also says it is problematic that the Trump administration did not conduct a notice-and-comment rulemaking process. In a statement and a court filing over the Memorial Day weekend, the Department said it does not intend to enforce guidelines it has issued that say only those eligible for regular student aid can get emergency student grants created by the CARES Act.


Executive & Regulatory News IconExecutive & Regulatory Affairs

White House

On June 2, the White House Office of National Drug Control Policy (ONDCP) will host a call from 3 p.m. to 4 p.m. ET for rural stakeholders to provide a comprehensive overview of the policy changes, resources, and funding that have been made available to support rural communities impacted by substance use disorder during the COVID-19 public health emergency. To register, RSVP here.


The Federal Communications Commission

On May 21, the Federal Communications Commission announced it is partnering with the Institute of Museum and Library Services (IMLS) among its latest coronavirus relief actions about the $50 million in funding to IMLS from the CARES Act to help address the digital divide during the ongoing pandemic. The agencies will team up to raise awareness among libraries and Tribal organizations, which can use them to increase broadband access in their communities. This includes work to expand digital network access, purchase Internet accessible devices, and provide technical support services to their communities. The goal of these grant programs is to support responses to the coronavirus pandemic in ways that meet the immediate and future COVID-19 needs in communities. Grant proposals may include short- or medium-term solutions to address gaps in digital infrastructure. Applications are due June 12, 2020 with award announcements anticipated in August 2020.


Federal Deposit Insurance Corporation (FDIC)

The FDIC has developed new information that will make it easier for unbanked consumers to open a bank account online so they too may receive their Economic Impact Payments from the Internal Revenue Service (IRS) securely and quickly. FDIC’s webpage Receiving IRS Economic Impact Payments is aimed at helping consumers get the information they need to open a bank account and receive their funds electronically and safely.


Department of Labor

EmploymentRecovery.org is a CareerOneStop website providing critical unemployment and job search resources for those impacted by the pandemic that went live May 19. The website aims to help people meet their short-term needs such as collecting unemployment benefits or re-entering the workforce, as well as their longer-term goals such as adjusting career plans in light of the evolving job market during the pandemic. Helpful information for job seekers includes updates on the COVID-related enhancements to the federal-state Unemployment Insurance program, how to apply for SNAP food assistance, how to defer payments for mortgages and other loans, and links to other relevant job search tools including a search for virtual employment and a search for immediate jobs.


Department of Homeland Security

Federal Emergency Management Agency
FEMA publishes a brief weekly email called the "Mitigation Minute" that contains facts about grants and resources provided across the country to reduce or eliminate long-term risk to people and property from natural hazards and does not endorse any non-government organizations, entities or services. To subscribe to the Mitigation Minute, visit the Hazard Mitigation Assistance webpage and select "Subscribe to HMA communications.”


Treasury Department

Treasury Department and IRS regulators officially eliminated the need for a large swath of politically active tax-exempt organizations to file information on their top donors to the IRS. These rules affect groups organized under 501(c)(4) of the tax code which include political groups such as the National Rifle Association and AARP; labor unions; and ‘dark money’ groups that fly under the radar.


State Policy IconHappening in the States

National Council of Nonprofits

Exclusive from our Colleagues at the National Council of Nonprofits

Unemployment Insurance Claims Remains Concern for Self-Insured Nonprofits

State officials continue to act on unemployment insurance claims for employers that self-insure under their state systems, including some nonprofits and government employers. Under federal and state laws, certain employers may opt out of their state unemployment insurance pools and “reimburse” the system for actual costs of claims. Legislation passed in North Carolina adds the Tar Heel State to the list of states that hold nonprofits harmless by not requiring them to reimburse the state unemployment systems during the coronavirus crisis. However, these states may be penalized for providing additional assistance to nonprofits under the “breathtakingly cruel” Department of Labor guidance issued earlier this month that requires these self-insured nonprofits to pay 100 percent of the costs of benefits and seek repayment of 50 percent, as provided under the CARES Act. Pending legislation in Illinois attempts to also hold nonprofits harmless, but would charge nonprofits and government employers 50 percent of the claims and then have the organization request repayment back for the 50 percent just paid. This maneuver is in alignment with the double reimbursement requirement under the DOL guidance. As an alternative option, Massachusetts lawmakers are providing nonprofits a reprieve by providing a 120-day delay in payments in hopes all of these unjust practices get worked out. The bill is awaiting the Governor’s signature.

The broad nonprofit community is advocating for relief from crippling unemployment costs and National Council of Nonprofits is conducting a survey to identify the problems and solutions. If your organization and grantees are among the 100,000 or more nonprofits or governmental entities that has elected to self-insure under your state unemployment compensation system, help with the data gathering by taking this CONFIDENTIAL survey.

Government Grants and Contracts Reforms

Recognizing their dependence on charitable nonprofits to provide essential services, states continue to focus on streamlining government grants and contracts processes. Recently, the Governor of Maryland signed significant grants reforms that will closely align state rules with the federal OMB Uniform Guidance, including the mandates to pay nonprofits their indirect costs. The new law calls for nonprofit input and promulgation of new regulations consistent with the OMB Uniform Guidance to the greatest extent practicable. Nonprofits in New Jersey are promoting a bill that permits state agencies to waive any penalty in a contract or agreement if a nonprofit cannot fulfill the terms and conditions in the contract due to COVID-19 (e.g., not serve as many people as contemplated because of stay-at-home orders). It would permit nonprofits to request a modification of the terms and conditions of a contract or agreement due to COVID-19. The legislation is intended to address concerns by nonprofits of financial penalties if they are unable to meet contracted levels of service and other terms negotiated prior to the crisis. Read the NJ Center for Non-Profits statement in support.