Current State of Play on CARES ACT

Earlier today Senate Republicans released an almost 600 page updated version of the Coronavirus Aid, Relief, and Economic Security (CARES) Act. Several provisions in the new version are important improvements we have been advocating for over the last several days and weeks. The most important improvements to the bill for our industry, and most importantly our industry employees, include:

• Increased funds for distressed sectors, from $150 billion to $500 billion, of which the hospitality industry would have access to $425 billion in loans.
• The small business (SBA 7(a)) loans section allows for $350 billion in total loans with loans up to $10 million. The new language includes a provision that AHLA pushed for which allows hotels to receive financial assistance if the hotel employs not more than 500 employees per physical location.
• AHLA advocated for increased Unemployment Insurance benefits for our impacted employees, which will be immediately accessible for those eligible without the two-week waiting period and for up to 39 weeks.  
• AHLA supported tax relief measures including: 

• Delay of employer payroll tax (if not receiving SBA or stabilization funds from Treasury)
• Net operating loss (NOL) carryback 
• Qualified Improvement Property (QIP) fix 
• Increase in interest deductibility in 2019 and 2020 to 50% of interest expense (vs 30%)

• Section 4013 provides flexibility for banking and financial institutions to suspend requirements under U.S. Generally Accepted Accounting Principles for loan modifications related to the coronavirus pandemic.  AHLA continues to press for further administrative actions around loan flexibility and debt forbearance.

The full text can be found in these links – Part A and Part B and the summaries from Capitol Hill can be found in these links – CARES, Appropriations, HELP.     

We are continuing to hear that there is not bipartisan, bicameral agreement on this legislation. An expected procedural vote scheduled to begin at 3:00 pm has been postponed until 6 pm. House and Senate Leadership continue to negotiate on this package and expect to see the Senate take up this legislation in the coming hours with the goal of final passage by no later than Tuesday. Speaker Nancy Pelosi has indicated that she may introduce her own version of the bill if a broader agreement cannot be reached which would prolong the legislative process.   

AHLA is in constant communication with leaders in Congress and the Administration.  One area of focus is to increase the amount of funding available through the SBA loan program. 

As the this critical economic stimulus package works its way through the legislative process, I urge you to continue your outreach – it is critical that Members of Congress continue to hear from our industry leaders and employees! The talking points and Hotels ACT call to action we provided late yesterday have been included below. 

Thank you for your ongoing engagement. We will continue to keep you apprised of this fluid situation.