It has been over two months since Congress passed the CARES Act, but one of the primary corporate support programs in the law for small and mid-sized businesses — the Main Street Program (MSP) — has not yet started to make loans.
The Federal Reserve has promised to “operationalize” the MSP soon, but in the meantime, American Car Rental Association (ACRA) members continue to struggle with the economic consequences of the pandemic.
ACRA is working with lawmakers to help its car rental constituents on a variety of levels.
Main Street Program
ACRA members interested in signing this letter to the Federal Reserve Board chairman and the Secretary of the Department of the Treasury should email the following information to Greg Scott by COB on Wednesday, June 10: (1) the name of the person signing for the company; (2) the company’s name; (3) the company’s headquarters city and state; and, (4) and number of current employees.
PPP Flexibility Act of 2020
Congress passed and on June 6, President Trump signed the “PPP Flexibility Act of 2020” into law. As the name implies, the new law providers borrowers under the Paycheck Protection Program with additional flexibility in terms of the use of PPP loan proceeds and loan forgiveness.
A key provision of the bill raises the non-payroll portion of a forgivable covered loan amount from the current 25% up to 40%. The bill also extends the covered period during which a loan recipient may use such funds for certain expenses while remaining eligible for forgiveness.
Check with your accountant or legal counsel on details, and access a brief summary of the law’s provisions provided by the Congressional Research Service.
Stimulus 4.0 or CARES 2.0
Despite the fact that the House passed the $3 trillion “HEROES Act” as a follow-up to the CARES Act, the White House and Senate Republicans have been in no hurry to negotiate with the House on a CARES 2.0 bill.
ACRA continues to focus on four policy priorities with respect to the implementation of the CARES Act and a potential CARES 2.0:
- Restoring Liquidity: The ACRA member letter in this newsletter and the CARES Act Main Street Program is ACRA’s primary focus in this area right now.
- Airport Issues: working on two fronts: (1) ACRA members are working individually with airports on rent relief and/or abatement; and, (2) ACRA is working with other airport concessionaires (food and retail) to seek federal grants to airports to make up for reduced MAG payments from all concessionaires, including car rentals.
- Liability Protection: ACRA is working with the U.S. Chamber of Commerce’s Institute for Legal Reform on federal legislation to prohibit frivolous lawsuits associated with the pandemic.
- Travel Tax Credit: ACRA is working with the U.S. Travel Association and other stakeholders on a federal tax credit or travel voucher to boost travel in general and car rentals specifically in the future.