Five Important COVID-19 Stimulus Law Provisions

Americans have waited with bated breath for months in hopes that Congress could reach an agreement on additional, much needed COVID-19 stimulus legislation. Thankfully, we appear to almost be there.

Here are some of the proposed provisions that will impact millions of Americans and hopefully keep people fed and help the economy. 

1. Extension of Pandemic Emergency Unemployment Insurance:

One of the hallmarks of the CARES Act, the original COVID relief bill passed back in March, was the additional federal unemployment insurance that provided those who lost their jobs with $600 a week on top of the amount they were also receiving from the state. That number later became $300 after President Trump reinstated the bonus following the expiration of that original provision of the CARES Act.

Those additional $300 checks were set to expire on December 31^st, meaning many unemployed workers would receive their final federal pandemic unemployment insurance check on December 26^th.

Thankfully, this new bill will extend eligibility for these additional $300 unemployment insurance checks all the way to April 19^th, 2021. The bill provides that it is up to the state to determine an individual’s eligibility to receive additional federal unemployment insurance.

2. Provider Relief Fund Clarifications

This new bill issues a number of important clarifications regarding revenue and reimbursement calculations for those who received emergency funds through the Provider Relief Fund. This fund was designed primarily to push additional funding out to healthcare providers during the pandemic, however, due to vagueness in the original provisions that established the fund, many providers who received funds were left wondering how they were to perform a number of important calculations required to determine lost revenues and eligible expense reimbursement.

Calculating lost revenue

The new bill provides that when calculating lost revenues in order to determine that amount of reimbursement from the Provider Relief Fund that the provider is eligible for, a provider may, “calculate lost revenues that are attributable to coronavirus by any reasonable method, including a method that calculates the difference between the budgeted and actual revenue of the eligible health care provider on a monthly, quarterly, or annual basis.”

This should give providers a tremendous amount of flexibility when calculating their coronavirus-related losses thereby allowing them to recoup an appropriate amount of funding based upon their unique situations.

Reimbursement for staffing

The bill states that “expenses eligible for reimbursement . . . shall include staffing expenses.” Admittedly, this provision likely remains over-vague considering “staffing expenses” could conceivably mean any amount expended on staff as opposed to simply salaries or hourly wages. Perhaps we will receive more guidance on this specific provision in the future.

Finally, the bill provides that a qualified representative (CFO or otherwise) must provide an attestation of any lost revenues for which they received reimbursement for through the Fund no later than 90 days after receiving that amount.

3. Back to work childcare grants

This bill should provide a huge lift for working families who need to ascertain proper child care in order to get back to work. Section 3101 provides specifically enumerated childcare grants for eligible childcare providers.

The bill calls for the establishment of childcare stabilization grants that will provide assistance in paying for costs and increased operating expenses and to “re-enroll children in an environment that supports the health and safety of children and staff.”

These grants will be administered through the states. The federal government will award the grants to the lead agency of each state. That agency will in turn distribute those grants to sub-applicants who apply and meet the appropriate qualifications. The bill calls for the disbursement of these grants to take place no later than 30 days after the date of enactment of the Act so we should see some of these funds start to get distributed on the state level before the end of January.

The amounts of the grants will be based upon the childcare provider’s average operating expenses as well as any additional amount the state determines is necessary to account for increased costs associated with operating during the pandemic. The states, in addition to being responsible for determining which childcare providers will be eligible to receive the grants, will be required to ensure that each applicant who receives a grant meets a set of certain assurances. Those assurances are as follows:

• not artificially suppress revenue, enrollment, or attendance for the purposes of receiving subgrant funding;
• provide the necessary documentation to the lead agency;
• implement all applicable State, Tribal, and local health and safety requirements and, if applicable, enhanced protocols for child care services and related to COVID–19 or another health or safety condition, and, to the extent possible, implement policies in line with guidance from the Centers for Disease Control and Prevention; and
• to the extent possible, provide relief from copayments and tuition payments for the families enrolled in the provider’s programs that are struggling to make either type of payments.  

Childcare providers will be permitted to utilize grant funds on some of the following:

1. Sanitization and cleaning expenses
2. Recruiting, retaining, and compensating child care staff
3. Operating costs including payroll, employee benefits, premiums, mortgages or rents,
4. Equipment necessary to provide childcare services in a matter that is safe
5. Replacing materials that are no longer safe due to COVID-19
6. Making facility changes in order to bring a facility into compliance with health and safety protocols in light of COVID-19
7. Equipment necessary to serve children during non-traditional hours
8. Modifications to childcare services such as reduced class sizes, heightened safety measures, and accommodations for children who have not had access to childcare
9. Providing mental health services
10. Any other activity related to the child care program of the childcare provider
11. Expenses incurred before the childcare provider received the grant

With any luck, this wave of funding for childcare providers will give working parents the peace of mind they need to get back to work while knowing that their children are safe and being cared for.

4. Rental assistance

The ability to pay rent became a concern for many individuals over the course of the pandemic once it became clear that they would only receive the singular $1200 stimulus check. Many states/localities instituted rent or eviction moratoriums but many of those protections have since expired. Thankfully, this bill will do much to assist renters as it makes $25 billion available to eligible grantees between 2021 and 2022.

The bill requires that the funds be disbursed to states and localities no later than 15 days after the enactment of the Act which means that these funds should bring relief almost immediately. Each state should receive a minimum of $200 million.

Renters can spend the funds on “rent, rental arrears, utilities and home energy costs, utilities and home energy arrears, and other expenses related to housing for a period not to exceed 18 months.” The ability to pay arrears, or money that should have been paid earlier, should relieve much anxiety for those renters who have missed payments over the course of the previous few months.

In order for a household to be eligible for this rental assistance it must meet the following requirements:

(i) that 1 or more individuals within the household has qualified for unemployment benefits or has experienced a reduction in household income, incurred significant costs, or experienced other financial hardship due to or during the novel coronavirus disease (COVID–19) outbreak;

(ii) that 1 or more individuals within the household can demonstrate a risk of experiencing homelessness or housing instability, which may include—

• (I) a past due utility, home energy, or rent notice or eviction notice;
• (II) unsafe or unhealthy living conditions; or
• (III) any other evidence of such risk, as determined by the eligible grantee involved; and

(iii) the household has a household income that is not more than 80 percent of the area median income for the household.

The bill also goes out of its way to prioritize this rental assistance for the hardest-hit families. Grantees will be required to prioritize providing assistance to eligible households with combined incomes that do not exceed 50% of the area median household income.

The bill would also allow landlords as well as utility companies to apply directly to cities and states on behalf of their renters (provided the renters cosign). This should help get more of this relief money into the hands of those who need it because oftentimes those who are eligible for this sort of assistance are not aware of how to access it.

5. Extension of eviction moratorium

The bill will also extend the Center for Disease Control and Prevention’s eviction moratorium that it imposed under section 361 of the Public Health Service Act back in September. The order was set to expire on December 31^st. This bill will extend that order up to January 31^st, 2021.

All of this assistance is obviously welcomed news for those in need. Experts from the National Low Income Housing Center warn, however, that upwards of $100 million in housing assistance is likely needed and thousands of families still remain at risk of eviction within the next month and a half.

Americans will breathe a collective sigh of relief following the enactment of this important stimulus legislation, especially considering the fears that there would be no stimulus at all before Congress headed into their Winter Recess. While the COVID-19 vaccine begins to make its way across the country there is still little doubt that additional stimulus will be needed. Stay tuned to this blog for important updates on future stimulus negotiations.