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Congress nears passage on third Coronavirus response legislation

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Congress nears passage on third Coronavirus response legislation

In response to the COVID-19 pandemic, the US Congress has debated and passed multiple pieces of legislation meant to address the immediate and urgent needs of citizens, first responders and healthcare professionals, employers and others. As the pandemic stretches into its second week of widespread school and non-essential business closures, the Senate unanimously passed a third package estimated to cost approximately $2 trillion—the largest federal spending package in American history.

The third Coronavirus response package passed the Senate by a vote of 96-0 late at night on March 25 and seeks to address multiple issues, industries, and needs. Provisions included in the bill would send checks to more than 150 million American households, set up loan programs for large and small businesses and nonprofits, increase funding for unemployment insurance programs, boost spending on hospitals, and more.

The bill, described in more detail below, has several provisions that are essential for afterschool providers, including:

  • The State Education Stabilization Fund can be used to support afterschool and summer learning programs and their providers
  • The additional funding for childcare can be used by afterschool providers/staff that are continuing to stay open to serve their existing students and/or the children of health care providers and other essential staff
  • It makes it clear that non-profits are eligible for all the resources targeted to small businesses.
  • Makes changes to the charitable deduction for tax year 2020 to encourage support of nonprofit organizations

After passage of the first two relief packages, Congress turned to the many varied needs of multiple sectors of the country’s economy, including education, welfare, health, and family services. The legislation, the Coronavirus Aid, Relief, and Economic Security Act (The CARES Act), also known as the Third COVID-19 Supplemental Relief bill, achieved bipartisan support after six days of nonstop negotiations, and now heads to the House of Representatives on Friday where Leadership will try to pass it by voice vote. President Trump has stated he will sign the bill once it passes both chambers.    

Supporters of afterschool have sent more than 10,000 messages and calls to members of Congress so far this month making the case for additional investments to support afterschool programs that have closed, as well as support for programs that are open and serving children of essential employees, and to ensure that out of school learning opportunities are accessible for students this summer and next fall to help address learning loss. National afterschool providers, intermediaries and supporters have also come together to call on Congress to support the field. While more support is needed, thanks to the outreach by the afterschool field Congress did include afterschool and summer learning among the activities that can be funded through new education grants.

The following provisions of the legislation are of particular interest to youth serving organizations and the afterschool and summer learning field:

Education

The law establishes a State Education Stabilization Fund funded at $30.75 billion with funds mostly split between Emergency Relief funds for Higher Education ($14.25 billion) and Elementary and Secondary School ($13.5 Billion). The stabilization fund also provides about 10 percent ($3 billion) that can be allocated at governors’ discretion for grants to local districts that the State Education Agency deems most impacted by COVID-19 to continue educational support and ongoing district operations

Within the Elementary and Secondary School Relief Fund,

  • $13.5 billion of this amount is set aside for K-12 education allocated to states based on Title I formula in the most recent fiscal year
  • State Education Agencies must distribute at least 90 percent of funds to school districts based on Title I formula (with up to 0.5% that may be used for state administration)
  • Local educational agencies (LEAs)can work with partner organizations to address community needs
  • Use of funds includes anything already in ESSA (which includes 21st CCLC), IDEA, Perkins-CTE, and the McKinney Vento Homeless Youth Act
  • Specific activities for this funding called out to address the pandemic include:
    • Planning and implementing activities during the summer and afterschool
    • Planning and coordinating meals
    • Online learning and other educational services
    • Purchasing technology
    • Mental health support
  • Includes an expectation that recipients of funds such as LEAs/school districts shall to the greatest extent practicable, continue to pay their employees and contractors
  • States must continue maintenance of effort; however, the secretary may waive the MOE requirement for states that experienced a "precipitous decline" in financial resources

Also separate from the state education grants is $100 million in funds for Safe Schools and Citizenship Education through Project SERV which provides education-related services—including counseling and referral to mental health services as needed—to LEAs.

Child Care

The Child Care Development Block Grant (CCDBG) is appropriated an additional $3.5 billion in grants to states for immediate assistance to child care providers to prevent them from going out of business and to otherwise support child care for families, including for healthcare workers, first responders, and others playing critical roles during this crisis.

Head Start is appropriated an additional $750 million for grants to all Head Start programs to help them respond to coronavirus related needs of children and families, including making up for lost learning time.

Community Services

  • Community Services Block Grant: $1 billion in direct funding to local community-based organizations to provide a wide-range of social services and emergency assistance for those who need it most

School Nutrition and Food Insecurity

  • Supplemental Nutrition Assistance Program (SNAP): $15.5 billion
  • Child Nutrition Programs (total): $8.8 billion (ensures children receive meals while school is not in session)

AmeriCorps and VISTA

The bill included provisions related to the Corporation for National and Community Service (CNCS) that provides participants serving in the National Service Corps programs (including AmeriCorps and VISTA) with the educational award they were due to receive before their duties had been suspended or placed on hold during the COVID-19 declaration of disaster. The bill also extend the age limits and the terms of service to allow individuals serving in national service programs to continue participating in programs after the COVID-19 declaration of disaster ends.

Nonprofit Organizations and Small Businesses

With regard to nonprofits including nonprofit afterschool and youth serving organizations and small for-profit afterschool providers, the legislation includes the following (more in-depth summary here):

  • A Charitable Giving Incentive, a new above-the-line deduction (universal or non-itemizer deduction that applies to all taxpayers) for total charitable contributions of up to $300. The incentive applies to contributions made in 2020 and would be claimed on tax forms next year. The bill also lifts the existing cap on annual contributions for those who itemize, raising it from 60 percent of adjusted gross income to 100 percent.

 

  • The Paycheck Protection Program increases the government guarantee of loans made for the Payment Protection Program under section 7(a) of the Small Business Act to 100 percent through December 31, 2020. The bill also provides the authority for the U.S. Small Business Administration (SBA) to make loans under the Paycheck Protection Program and defines eligibility for loans as a small business, 501(c)(3) nonprofit, a 501(c)(19) veteran’s organization, or Tribal business concern described in section 31(b)(2)(C) of the Small Business Act with not more than 500 employees, or the applicable size standard for the industry as provided by SBA, if higher. The bill applies current SBA affiliation rules to eligible nonprofits. Includes sole-proprietors, independent contractors, and other self-employed individuals as eligible for loans. 

 

  • Allows businesses with more than one physical location that employs no more than 500 employees per physical location in certain industries to be eligible and is below a gross annual receipts threshold in certain industries to be eligible. Defines the covered loan period as beginning on February 15, 2020 and ending on June 30, 2020. Establishes the maximum 7(a) loan amount to $10 million through December 31, 2020 and provides a formula by which the loan amount is tied to payroll costs incurred by the business to determine the size of the loan. 

 

  • Specifies allowable uses of the loan include payroll support, such as employee salaries, paid sick or medical leave, insurance premiums, and mortgage, rent, and utility payments. Provides delegated authority, which is the ability for lenders to make determinations on borrower eligibility and creditworthiness without going through all of SBA’s channels, to all current 7(a) lenders who make these loans to small businesses, and provides that same authority to lenders who join the program and make these loans.

 

  • Treasury will endeavor to implement a special 13(3) facility through the Federal Reserve targeted specifically at nonprofit organizations and businesses between 500 and 10,000 employees, subject to additional loan criteria and obligations on the recipient, such as: (1) The funds received must be used to retain at least 90 percent of the recipient’s workforce, with full compensation and benefits, through September 30, 2020; (2) The recipient will not outsource or offshore jobs for the term of the loan plus an additional two years; (3) The recipient will not abrogate existing collective bargaining agreements for the term of the loan plus an additional two years; and (4) The recipient must remain neutral in any union organizing effort for the term of the loan.  

 

  • Emergency Unemployment Relief for Governmental Entities and Nonprofit Organizations - this section of the bill 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.

 

Next Steps

While the bill has to pass the House before becoming law, and will not address all of the challenges of the afterschool field as it responds to the pandemic, the funding opportunities and flexibility included in the bill will help local and state level afterschool advocates as they work to serve their communities children, youth and families.  Guidance from federal agencies will be important once the bill is passed to help ensure quick and effective implementation of the law.

In the meantime, friends of afterschool can continue to reach out to Congress about the important role afterschool programs are playing.

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BY: Erik Peterson      11/21/23

Summer is ending! What is the status of appropriations for STEM education on Capitol Hill?

As is the case each August, Congress has left Washington D.C., for several weeks. The month’s slower pace gives STEM, education and afterschool advocates an opportunity to digest what happened in the frantic days before the recess and assess what remains to be done in 2023. The annual...

BY: Anita Krishnamurthi      08/28/23

Back to school means back to D.C. for Congress. What’s ahead in September?

The slower pace of August in Washington, D.C., is nearing its end. The imminent return of the U.S. Congress to Capitol Hill and the people’s business suggests the need for revisiting what lawmakers did before the August recess and what faces them in September. As students and teachers go back...

BY: Erik Peterson      08/25/23

Senate appropriators propose level funding for 21st CCLC in FY 2024

The Senate Appropriations Committee released and marked up their Labor, Health, and Human Services, Education and Related Agencies (LHHS) bill on July 27, 2023. The bill proposes $224.4 billion in total funding for Fiscal Year 2024. The Nita M Lowey 21st Century Community Learning Center Initiative...

BY: Erik Peterson      07/31/23

House Appropriators mark-up FY 2024 Education spending bill

This week, the House of Representatives Appropriations Committee pushed the FY 2024 appropriations process forward by holding multiple subcommittee mark-ups. On Friday, July 14, the Labor, Health and Human Services, Education (LHHS-ED) and Related Agencies Appropriations Subcommittee marked up its...

BY: Erik Peterson      07/14/23

Congress passes deal to raise debt limit and constrain spending

UPDATE: June 2, 2023: Late on the night of June 1, the U.S. Senate passed the Fiscal Responsibility Act by a vote of 63-36, about 24 hours after the House passed the bill with a bipartisan vote of 314-117. The President is expected to sign the bill into law today. On May 31, the House passed the...

BY: Erik Peterson      06/01/23

March madness = Budget & appropriations process kickoff!

This year, early March means the release of the president’s budget proposal for the upcoming fiscal year and the beginning of the FY 2024 appropriations process in Congress. Here's what we know so far about how this year’s process may roll out in the coming year.  On or...

BY: Erik Peterson      03/01/23

STEM education update: Good news and looking ahead

In the final weeks of 2022, Congress passed a $1.7 trillion spending bill to fund every agency through the end of fiscal year (FY) 2023. The bill was the product of weeks of negotiations and defense spending, supporting the CHIPS and Science Act and some policy issues attached to the bill took...

BY: Anita Krishnamurthi      02/23/23

Mammoth spending bill includes support for afterschool, summer, mentoring, and more

In December, the 117th Congress approved a $1.7 trillion bill that included a $40 million increase for the Nita M. Lowey 21st Century Community Learning Centers (21st CCLC) initiative and additional increases across the US Department of Education important to afterschool programs, public schools,...

BY: Erik Peterson      01/23/23