Goalpost moved again on key programs in $3 Trillion, 1,800+ page bill 

A draft of the fourth coronavirus relief package bill is circulating in the House. Crafted by the Democrats and dubbed The Heroes Act, the sprawling bill weighs in at over 1,800 pages and $3 trillion in new funding (roughly the same amount as in the previous three phases combined). The draft includes several provisions impacting the banking industry, but it remains to be seen how dramatically the bill will need to change in order to receive support from enough Republicans to eventually become law. The final version may look very different. 

Banking-related highlights of the current draft are below: 

  • PPP changes: 
    • Funding – specifies allocations of guarantees to community financial institutions, nonprofits and eligible recipients of 10 employees or less, amongst others 
    • Covered period extended from 8 weeks beginning from origination to 24 weeks 
    • Both interest and principal amounts deferred for up to one year rather than deferral of only principal for 6 months 
    • Allow payroll tax deferral for PPP recipients 
    • Other program changes and clarifications 
  • Mortgage Assistance/Foreclosure Prevention 
    • Extended, expanded eviction moratorium and foreclosure moratorium in the CARES Act to include all renters and homeowners 
      • Definition of “covered mortgage” expanded to all portfolio loans except HELOCs and reverse mortgages 
      • Automatic enactment of 60-day forbearance 
      • Automatic 120-day renewal of forbearance 
      • Borrowers can request another 180-day renewal for a maximum 360-day forbearance 
    • Specifies loan modifications and loss mitigation that should be available to homeowners when forbearance ends (no lump sums due) 
  • SAFE Banking provision: 
    • Allows cannabis-related legitimate businesses to access banking services and products 
    • Requirement for federal banking agencies to issue guidance regarding hemp within 90 days of enactment 
  • Updates to retirement and pension plan regulations, including: 
    • Waiver of required minimum distributions for 2019 
    • Waiver of 60-day rule in case of rollover of otherwise required minimum distributions in 2019 and 2020 
  • Ag provisions: 
    • Establishes a direct dairy donation program to prevent dumped milk 
    • Provides cash flow assistance to certain small and mid-sized diaries 
    • Authorizes an USDA recourse loan program for dairy processors, packagers, merchants, marketers, wholesalers, and distributors 
    • Provides emergency assistance to support livestock producers who are forced to euthanize market-ready livestock due to local processing plan disruptions because of COVID-19 
    • $228 million in additional support plus $16.5 billion for direct payments to agricultural producers 
    • Additional aid to individuals: 
    • Extends the $600/week unemployment benefit through Jan. 31, 2021. 
    • Extension of several Families First Coronavirus Response Act provisions, such as unemployment compensation and interest-free loans to states. 
    • Expands CARES Act Economic Impact Payments (EIPs) to make all dependents eligible for the $500 qualifying child amount 
    • Protects 2020 EIPs against garnishment 
    • Provides an additional $1,200 refundable tax credit to each family member, similar to the CARES Act EIPs. 
      • Details: The credit is $1,200 for a single taxpayer ($2,400 for joint filers), in addition to $1,200 per dependent up to a maximum of 3 dependents. The credit phases out starting at $75,000 of modified adjusted gross income ($112,500 for head of household filers and $150,000 for joint filers) at a rate of $5 per $100 of income. 
  • New, expanded, or extended payroll tax credits for paid sick and family leave 
  • Requires OSHA to issue an emergency temporary standard (ETS) within 7 days of enactment to protect health care and other workers at occupational risk of exposure to COVID-19 which requires employers to develop and implement a comprehensive infectious disease exposure control plan. 
  • Extends or expands FMLA and Emergency Paid Sick Leave Act benefits for employees 
  • Requirements for states and jurisdictions to establish contingency plans that enable voting in federal elections during a state of emergency, public health emergency, or national emergency and to update such plans at least every five years. 

In addition to the provisions above, the bill includes $500 billion in aid for state governments, $375 billion for local governments, and $20 billion each for Tribal governments and Territories. 

Related to public health, the draft bill would require the Secretary of the Department of Health and Human Services to update the COVID-19 strategic testing plan required under the Paycheck Protection Program and Health Care Enhancement Act ("Phase 3.5”) by June 15, 2020 to include specific plans and benchmarks with clear timelines, among other requirements.