US Congress Passes and President Signs Stimulus Package in Response to COVID-19

What optics and photonics companies need to know: key provisions, dates, and legislative text
27 March 2020

SPIE, the international society for optics and photonics, is continuing to track relevant legislation related to the U.S. response to the COVID-19 pandemic, including the developing economic crisis created by the virus. Below is an outline of the three-phased congressional approach to addressing these issues, including the most recent Phase 3 legislation that was passed by the U.S. Congress and signed into law by the President on 27 March 2020.

Phase 1: Key Provisions

→ $8.3 billion total appropriated

→ $20 million for the Small Business Administration’s "Disaster Loans Program Account"

    • Coronavirus was deemed to be a disaster and the cost of direct loans are to be made available under ‘‘Disaster Loans Program Account’’ in any fiscal year to make economic injury disaster loans

→ $2.2 billion for CDC–Wide Activities and Program Support

→ $836,000,000 for National Institute of Allergy and Infectious Diseases within the National Institutes of Health (NIH)

→ 3.1 billion for the “Public Health and Social Services Emergency Fund’’ to fund development, manufacturing and purchase of vaccines and medical supplies

    • Funds may be used to develop and demonstrate innovations and enhancements to manufacturing platforms to support such capabilities

→ Additional funding provided for international disaster assistance and global health programs

Status: Became law on 6 March 2020

Read the full text

Phase 2: Key Provisions

→ Emergency Family and Medical Leave Expansion Act (E-FMLA)

    • Establishes a 12-week emergency paid leave benefits program to provide payments to employees taking leave due to the need to take care of son or daughter under 18 years old

    • Applies to companies with fewer than 500 employees

    • Employee must have worked for the employer for at least 30 days

    • First 10 days may be unpaid leave, after this time period two-thirds of employee’s regular rate of pay required up to $200 a day and up to $10,000 total

    • Provide job protection to employee requiring restoration of position following emergency leave consistent with traditional FMLA rights and obligations

       - Exempts employers with 25 or less employees under certain qualifying circumstances

→ Emergency Paid Sick Leave Act (E-PSLA)

    • Companies with under 500 employees required to provide sick leave up to 80 hours for qualified full-time employees and time equal to the number of hours they work on average over a two-week period for part-time employees

    • Rates vary based on:

       - $200 a day and $2,000 total if leave is to (a) care for an individual subject to a federal, state or local quarantine or isolation; (b) care for a child whose school/place of care is closed or whose care provider is unavailable; or (c) deal with a "substantially similar condition”

       - $511 a day and $5,110 total if leave because employee (a) is subject to a state, local or federal quarantine; (b) has been advised by a health care provider to self-quarantine; or (c) is experiencing symptoms of COVID-19 and seeking a medical diagnosis

    • No “30-day on payroll” requirement to access paid sick leave

    • Penalties for failure to pay required sick leave will be treated as a failure to pay minimum wages in violation of the Fair Labor Standards Act

→ Applying to both E-FMLA and E-PSLA:

    • Gives the Department of Labor authority to exempt small businesses with less than 50 employees if compliance would jeopardize the viability of their business

    • 100% of paid leave provided by employers will be reimbursed by the federal government via tax credit

    • Provisions go into effect on 2 April 2020

       - Benefits provided before the effective date of April 2 would not be available for tax credit reimbursement

    • Laws are in effect through 31 December 2020

→ Other Provisions in Phase 2 bill:

    • Expands unemployment benefits and provides grants to states for processing and paying claims

    • Establish requirements for providing coronavirus diagnostic testing at no cost to consumers

    • Temporarily increase the Medicaid federal medical assistance percentage (FMAP)

Status: Became law on 18 March 2020

Read the full text

Phase 3: Key Provisions

→ $2.2 trillion stimulus package

→ $504 billion in Corporate Loans and Grants

    • $17 billion for companies deemed critical to national security

    • $425 billion for other businesses, cities, and states, allocated through funding mechanisms set up by the Federal Reserve

    • $17 billion for firms essential to national security

    • $25 billion in grants for the passenger airlines

    • $25 billion in loans for passenger airlines

→ $377 billion in Aid for Small Businesses

    • $349 billion towards Zero-interest “interruption loans” for firms with fewer than 500 employees

       - Loans that could be forgiven if the firms follow certain conditions, such as not laying off their workers

       - Maximum loan is capped at $10 million

       - Loans convert to grants if used for covering employee salaries, rent, paid leave, utility payments, health insurance premiums, or other necessities or worker protections

       - Nonprofits can also apply for these funds

    • $10 billion for SBA Disaster Loans due to economic injury

→ Business tax cuts, deferral

    • The amount companies could deduct off their interest increases to 50 percent (previously 30%)v

    • Greater ability to deduct losses against taxable income

    • Delays the payroll taxes typically paid by employers on wages

    • The 6.2 percent tax on wages businesses normally pay would instead have to be paid over the following two years, with the first half due Dec. 31, 2021, and the second half due at the end of 2022

→ Funding at Science Agencies:

    • Department of Energy (Office of Science) – $99.5 million

       - To support operations of the national laboratory scientific user facilities, including support research and development efforts related to coronavirus

    • National Institute for Standards and Technology (NIST)

       - Manufacturing Extension Partnership (MEP) – $50 million to be distributed among the 51 MEP centers. The bill also waives the statutory cost-match requirements for all FY2020 funding

       - National Institute of Standards and Technology – $6 million to support continuity of operations

    • National Oceanic and Atmospheric Administration (NOAA)

       - $20 million to support continuity of mission-critical operations

    • National Science Foundation (NSF) – $76 Million

       - RAPID Grants – $75 million to support NSF’s ongoing RAPID grant response to coronavirus

       - Grant Administration – $1 million to assist in the administration of RAPID grants

    • National Aeronautics and Space Administration (NASA) – $60 Million

       - Safety, Security, and Mission Support – $60 million to support NASA with resources for operational adjustments associated with mission delays

    • Department of Defense (DoD) Industrial Base $2.45 billion

       - $1.45 billion for the Defense Working Capital Funds as the Defense Logistics Agency and military services work to mitigate the impact of COVID-19 on production lines, supply chain, military depots, and labs

       - $1 billion for the Defense Production Act to increase access to materials necessary for national security and pandemic recovery

→  Other Provisions in Phase 3 bill:

    • $1,200 per adult and $500 per child for individual taxpayers earning under $75,000 annually (or $150,000 for a couple filing jointly) with benefits phased out above that amount

    • Increases unemployment insurance benefits

    • $175 billion towards hospitals, expanded health-care spending

    • $150 billion to state and local governments, including $8 billion for tribal governments

Status: Became law on 27 March 2020

Read the full text

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