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Michigan Credit Union League

(U.S. Senate’s Phase 4 Stimulus Proposal Consisting of 10 separate bills, thus far)

MCUL Priorities Absent from the Senate proposal

MCUL has written and held virtual meetings with our congressional delegation advocating to have the following legislation and issues included in the Senate Phase 4 bill:

  • S. 3630, Senator Jack Reed’s bill that would establish a $75 billion housing assistance fund
  • Funding for CFDI at $1 billion, as provided by the HEROES Act
  • Modernization of E-Commerce Laws to include S.3533/H.R. 6364, to better effectuate electronic and remote notarizations and S. 4159, that would modernize the E-SIGN Act to reflect advances in technology and remove barriers that some face to receiving important document electronically


MCUL Summary

Committee on Finance

American Workers, Families, and Employers Assistance Act

Section 101 (Improvements to Federal Pandemic Unemployment Compensation to better match lost wages)- Would continue supplemental payments of $200 per week for weeks of unemployment through September. Starting in October, this payment would be replaced with a payment (up to $500) that, when combined with the state UI payment, would replace 70 percent of lost wages. Also requires states, beginning 30 days after enactment, to notify recipients of unemployment insurance and employers about state law regarding return to work and suitable work requirements.

Section 102 (Supplemental emergency unemployment relief for governmental entities and nonprofit organizations)- The CARES Act provides payment to states to reimburse nonprofits, government agencies, and Indian tribes for half of the costs they incur through December 31, 2020 to pay unemployment benefits. This provision increases the percentage from 50 to 75 percent.

Sections 201 & 202 (Additional 2020 recovery rebates for individuals and modifications to recovery rebates made under the CARES Act)- Similar to the direct payments provided by the CARES Act, under the Senate proposal, Americans will receive direct payments from the Treasury up to $1,200 per individual/$2,400 married couple, as well as $500 per dependent which is extended to dependents of any age.  The payments phase-out completely once the income of single filers exceed $99,000, the income of head of household filers with one child exceed $146,500, or the income of joint filers with no children exceed $198,000.

Section 211 (Enhanced employee hiring and retention payroll tax credit)- The CARES Act provided an employee retention tax credit (ERTC) in the form of a refundable payroll tax credit equal to 50 percent of certain wages paid by employers to employees during the COVID-19 crisis. This section increases the applicable percentage of qualified wages reimbursed through the credit to 65 percent.

Under the CARES Act, employers are eligible for the ERTC if their (1) operations were fully or partially suspended due to a COVID-19-related shut-down order, or (2) gross receipts declined by more than 50 percent when compared to the same quarter in the prior year. This section lowers the amount of the reduction in gross receipts required to qualify as an eligible employer from a 50- percent decline to a 25-percent decline compared to the same calendar quarter in the previous year.

The credit is based on the amount of qualified wages paid by the employer. The CARES Act limited the amount of qualified wages taken into account per employee to $10,000 for the year. This section increases the limitation on qualified wages taken into account per employee to $10,000 per quarter (limited to $30,000 for the calendar year).

Under the CARES Act, for employers with greater than 100 full-time employees, the credit is based only on the portion of an employee’s wages that compensate the employee for not performing services. For employers with 100 full-time employees or less, the credit is based on all wages paid to an employee. This provision increases the 100-employee threshold to 500 employees.

The section enhances coordination between the credit and the Paycheck Protection Program by allowing employers to be eligible for both programs, but with limitations to prevent overlapping benefits. It also clarifies that group health plan expenses are considered qualified wages even when no other wages are paid to the employee, consistent with IRS guidance.

This section is generally effective as of the beginning of the calendar quarter during which the provision is enacted. However, the provisions that modify the treatment of health plan expenses and the definition of gross receipts for tax-exempt organizations apply retroactively as if included in Section 2301 of the CARES Act.

Section 212 (Temporary expansion of work opportunity tax credit)- The work opportunity tax credit (WOTC) provides an elective tax credit to employers hiring individuals who are in one or more of ten targeted groups. Generally, the maximum credit per employee is $2,400 (40 percent of the first $6,000 of qualified first-year wages), but special rules apply for certain targeted groups. To claim the credit, an employer must obtain certification of the employee’s eligibility from the appropriate State workforce agency.

This section adds a new WOTC targeted group, 2020 qualified COVID-19 unemployment recipients. A 2020 qualified COVID-19 unemployment recipient is an individual who is certified by the designated local agency as having received (or approved to receive) unemployment 5 compensation under State or Federal law for the week of or immediately preceding the hiring date and who begins work after the date of enactment and prior to January 1, 2021.

The section also increases the credit amount applicable to the new targeted group to 50 percent of the first $10,000 of qualified first-year wages.

Section 213 (Safe and healthy workplace tax credit)- This section establishes a refundable payroll tax credit equal to 50 percent of an employer’s “qualified employee protection expenses,” such as testing for COVID-19, protective personal equipment, cleaning supplies, “qualified workplace reconfiguration expenses,” including modifications to workspaces for the purpose of protecting employees and customers from the spread of COVID-19, and “qualified workplace technology expenses,” including contactless point of-sale systems and other technology to track employee interactions with customers. Qualified workplace reconfiguration expenses and qualified workplace technology expenses must have a primary purpose of preventing the spread of COVID-19 among other requirements.

An employer’s qualified employee protection expenses, qualified workplace reconfiguration expenses, and qualified workplace technology expenses are limited based on the employer’s average number of employees. In each calendar quarter, qualified expenses cannot exceed a cap based on the average number of employees. The cap is equal to $1,000 for each of the first 500 employees, plus $750 for each employee between 500 and 1000, plus $500 for each employee that exceeds 1,000.

The credit also permits self-employed individuals, including sole proprietors, independent contractors, and farmers, to claim a refundable credit against income taxes for the same types of COVID-19 related expenses. Self-employed individuals are treated as if they are an employer with a single employee for purposes of the credit.

The credit applies to amounts paid or incurred for qualified employee protection expenses after March 12, 2020 and before January 1, 2021.

Section 223 (Employee certification as to eligibility for increased CARES Act loan limits from employer plan)- The CARES Act permits eligible retirement plans to rely on an employee’s self-certification that the employee qualifies to receive a coronavirus-related distribution. This section clarifies that plans may also rely on an employee’s self-certification that the employee meets the requirements for the increased limits on retirement plan loans. The provision applies retroactively as if included in Section 2202 of the CARES Act.

Section 305 (Temporary carryover for health and dependent care flexible spending arrangements)- This section allows Flexible Spending Account (FSA)/Dependent Care Flexible Spending Account (DCFSA) unused 2020 contribution amounts to be rolled over into the 2021 plan year, recognizing care forgone in 2020 and promoting wellness in 2021.

Committee on the Judiciary

The Safeguarding America’s Frontline Employees To Offer Work Opportunities Required To Kickstart The Economy (SAFE TO WORK) Act

The bill establishes liability protections for businesses.   Under the bill, businesses, nonprofits, healthcare providers, and schools would be protected for 5 years, dating back to December 1, 2019 and lasting through October 1, 2024. Would require plaintiffs, in federal court, to “prove by clear and convincing evidence that-  (1) in engaging in the businesses, services, activities, or accommodations, the individual or entity was not making reasonable efforts in light of all the circumstances to comply with the applicable government standards and guidance in effect at the time of the actual, alleged, feared, or potential for exposure to coronavirus; (2) the individual or entity engaged in gross negligence or willful misconduct that caused an actual exposure to coronavirus; and (3) the actual exposure to coronavirus caused 12 the personal injury of the plaintiff.

Committee on Small Business

Continuing Small Business Recovery and Paycheck Protection Program Act

(PPP & SBA 7(a) Provisions)


Section 101 (PPP-Additional Eligible Expenses)- This section would make the following expenses allowable and forgivable uses for Paycheck Protection Program funds:

  • Covered operations expenditures. Payment for any software, cloud computing, and other human resources and accounting needs.
  • Property damage costs. Costs related to property damage due to public disturbances that occurred during 2020 that are not covered by insurance.
  • Covered supplier costs. Expenditures to a supplier pursuant to a contract for goods in effect prior to February 15, 2020 that are essential to the recipient’s current operations.
  • Covered worker protection expenditure. Personal protective equipment and adaptive investments to help a loan recipient comply with federal health and safety guidelines related to COVID-19 during the period between March 1, 2020, and December 31, 2020.

Section 102 (PPP-Lender Safe Harbor) This section would provide that no enforcement action could be taken against a lender who in good faith relied on a certification or documentation submitted by a borrower of a covered loan.

Section 103 (PPP-Selection of Covered Period for Forgiveness) This section allows the borrower to elect a covered period ending at the point of the borrower’s choosing between 8 weeks after origination and December 31, 2020.

Section 104 (PPP-Simplified Application) This section creates a simplified application process such that:

  • For loans under $150,000. Borrowers are not required to submit to the lender documentation required by section 1106(e) of the CARES Act, but must attest to a good faith effort to comply with Paycheck Protection Program loan requirements, retain relevant records for three years, and may complete and submit demographic information. The Administrator may review and audit these loans to ensure against fraud.
  • For loans between $150,000 and $2 million. Borrowers are not required to submit to the lender documentation required by section 1106(e) of the CARES Act, but must complete the certification required by that section, retain relevant        records and worksheets for three years, and may complete and submit demographic information. After lenders review the application for completeness, they must submit the application to the Administrator. The Administrator may review and audit these loans for fraud.
  • The SBA must submit to the Senate and House Small Business Committees a report 30 days after enactment detailing their review and audit plan to mitigate risk of fraud and provide monthly reviews and audit updates thereafter.

Section 106 (Paycheck Protection Program Second Draw Loans) This section creates a second loan from the Paycheck Protection Program for eligible businesses and businesses qualifying originally under

  •  Provides $190 billion of committed and appropriated funds to support PPP and PPP Second Draw Loans.
  •  Defines eligibility for PPP Second Draw loans as small businesses that meet the applicable SBA revenue size standard, have no more than 300 employees, and demonstrate at least a 50 percent reduction in gross revenues.
  •  Includes a $25 billion set-aside for entities with 10 or fewer employees and a $10 billion set aside for loans made by community lenders.
  •  The maximum loan size would equal 2.5 times average total monthly payroll costs, up to $2 million. Businesses that received a PPP loan may not receive another PPP loan that aggregates to more than $10 million.
  •  The 60/40 cost allocation for payroll and non-payroll costs to receive full PPP forgiveness continues to apply.

Section 107 (Continued Access to the Paycheck Protection Program)- This section reduces the maximum amount borrowers may receive under the first round of Paycheck Protection Program funding from $10 million to $2 million.

Section 108 (Increased Ability for Paycheck Protection Program Borrowers to Request an Increased in Loan Amount due to Updated Regulations)- This section allows borrowers whose loan calculations have increased due to changes in interim final rules to work with lenders to alter their loan value regardless of whether the loan has been fully disbursed or if Form 1502 has already been submitted.

Section 112 (Changes to the 7(a) Loan Guaranty Program for Recovery Sector Business Concerns)- This section improves the terms of 7(a) loans for seasonal businesses and businesses located in small business low-income census tracts.

  • Authorizes $100 billion in long-term, low-cost loans to recovery sector businesses, which include seasonal businesses and businesses located in low-income census tracts that meet the applicable SBA revenue size standard, have no more than 500 employees, and demonstrate at least a 50 percent reduction in gross revenues.
  • Loan amounts would be available at up to twice the borrower’s annual revenues, not to exceed $10 million. The loan would have a 100% SBA guarantee and maturity of up to 20 years with a one percent fixed interest rate to the borrower.
  • Waives the SBA’s credit elsewhere test and allows the borrower to defer loan and interest payments for the first 2 years.
  • Allowable loan uses include working capital, acquisition of fixed assets, and refinancing existing indebtedness.

Section 115 (Effective Date; Applicability)- Amendments made by this bill shall apply to Paycheck Protection Program loans as if included in the CARES Act.

Section 116 (Bankruptcy Provisions)- This section would establish a special procedure in the bankruptcy process if the Administrator determines certain small business debtors are eligible for Paycheck Protection Program loans.

Section 117 (Conflicts of Interest)- This section would require the President, Vice President, the head of an Executive department, or a Member of Congress as well as their spouse, child, son-in law, or daughter-in-law to disclose this status when receiving Paycheck Protection Program, Paycheck Protection Program Second Draw, and Recovery Sector loans.

Section 131 (Commitment Authority and Appropriations)-

  • Direct Appropriations. Would rescind $100 billion in previously appropriated funds from the CARES Act and the Paycheck Protection Program and Health Care Enhancement Act and appropriate $190 billion in funds for the Paycheck Protection Program and Second Draw Loans.
Committee on Appropriations

Labor, Health and Human Services, Education and Related Agencies Committee Proposal

The proposal funds a wide range of grands and programs under the jurisdiction of the Department of Labor, Department of Health and Human Services, Department of Education, and other agencies.  This includes:

  • $105 billion help get students back to school and provide for the continued learning of all students in elementary and secondary education and higher
  • $15 billion for childcare
  • $16 billion for testing, contract tracing and surveillance
  • and more than $40 billion for vaccines and Covid-19 research

Coronavirus Response Additional Supplemental Appropriations Act

The bill seeks to appropriate funds to various departments, agencies and programs.  Nothing seen that’s specific to credit unions.

Introduced by Senator Mitt Romney (R-UT)

Time to Rescue United States’ Trusts (TRUST) Act

The legislation would establish so called “rescue committees” to study necessary changes to the Social Security and Medicare Trust Funds to ensure they are actuarially solvent for 75 years.  

Introduced by Senator Lamar Alexander (R-TN), Chair of the Senate Health and Education Committee

Safely Back to School and Back to Work Act

Generally, the bill would allow student loan borrowers with no income to continue to defer their monthly payment, give parents more choices of schools for their children and to increase availability of child care for working parents.

Introduced by Senator Tim Scott (R-SC) and Senator Lamar Alexander (R-TN)

School Choice Now Act

The bill would:

  • Provide one-time, emergency appropriations funding for scholarship-granting organizations in each state.
    • Scholarship-granting organizations would be authorized to use the one-time funding to provide families with direct educational assistance, including private school tuition and home-schooling expenses
    • Parents could choose the academic instruction that works best for their child
  • Provide permanent dollar-for-dollar federal tax credits for contributions to scholarship-granting organizations, capped at $5 billion per year
  • Allow states to create their own tax credit scholarship program that works for the unique needs of students in their state
  • Prohibit federal control of education to ensure that all education providers may be able to participate without fear of federal control
Introduced by Senator Lindsey Graham (R-SC)

Restoring Critical Supply Chains and Intellectual Property Act

The bill deals with shifting the production of personal protection equipment (PPE) from China to the United States and requires the government to boost its supplies of PPP in the national stockpile.

Introduced by Senator Tim Scott (R-SC)
Supporting America’s Restaurant Workers Act

The bill would increase the tax deduction for business meals from 50% to 100%.

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