American Rescue Plan Act Signed Into Law
The American Rescue Plan Act (ARPA) was passed by both houses of Congress and signed into law by President Biden last week. The bill provides $1.9 trillion in funding for programs that will affect nearly every aspect of the American economy.
ARPA authorizes the expenditure of billions to expand or extend existing coronavirus relief and stimulus measures passed in 2020 as part of the three packages previously aimed at pandemic relief (FFCRA, CARES Act, and December 2020 stimulus bill). ARPA also provides funding for new initiatives and programs relating to the pandemic itself and ongoing recovery efforts for the country.
Taylor English is providing detailed reports on many aspects of ARPA that are likely to affect our clients, including the Restaurant Revitalization Fund, Paycheck Protection Program updates, FFCRA tax credits and changes to unemployment.
In addition, here is a summary of many of the major programs to be funded by ARPA:
- Unemployment: ARPA extends until early September the $300/week pandemic unemployment benefit. It also grants tax-free status for many individuals for up to $10,200 unemployment assistance received in 2020.
- Individual Stimulus Check: eligible Americans will receive up to $1,400.
- New PPP and EIDL Funding: ARPA authorizes $7 billion in new funding for PPP loans, and expanded eligibility for non-profits to receive such funds. The law also dedicates $15 billion for targeted Economic Injury Disaster Loans designed to help very small businesses.
- Restaurant Relief and Shuttered Venue Operator Grants: the new law devotes $28.6 billion to create a new grant (not loan) program for restaurant owners affected by the pandemic. ARPA also allocates $1.25 billion for a similar existing grant program for operators of live performance venues hit by the pandemic.
- Tax Credits: ARPA extends the availability of employer FFCRA tax credits for voluntarily offering paid leave associated with illness or childcare problems related to the pandemic. The bill also enhances certain individual and family tax credits including the Earned Income Tax Credit and Child Tax Credit.
- Testing and Vaccinations: one of the signature new pieces of ARPA is the allocation of nearly $63 billion for national programs to improve manufacture and delivery of vaccines and testing, contact tracing, provision of PPE to front line workers, and similar measures designed to control the spread of the virus. There is also $7.66 billion to support the public health workforce’s efforts. $2 billion goes to the federal IT budget, which is connected with vaccine development and distribution, remote delivery of service to the public, the promised national vaccinations website, and other pandemic matters.
- Schools: K-12 schools will receive $125 billion in reopening assistance, and higher education institutions receive nearly $40 billion (including restoring or maintaining jobs at those institutions). An additional $39 billion applies to childcare programs. Additional funding is allocated for education-related measures such as broadband investment for schools, library re-opening, and other items.
- Economic Development Agency: ARPA designates $3 billion to assist local economies in rebuilding tourism, travel, and outdoor recreation.
- State and Local Governments: a high priority item for Democrats throughout the pandemic has been funding for state and local governments. ARPA provides fiscal aid of $350 billion to fight the pandemic, offset revenue losses, pay essential workers, and support economic recovery. In addition, ARPA provides $10 billion for Critical Infrastructure Projects to help those governments with capital improvement projects relating to the pandemic.
ARPA also provides money for dozens of other programs, including assistance to renters for rent and utilities, assistance to homeowners with their mortgages (many of which will come out of forbearance in the coming months) and utilities, continued relief from student loan payments, payroll support for the airlines, nutrition support via existing programs such as SNAP and WIC, expansion of veterans’ health benefits, health insurance premium subsidies for ACA marketplace health policies, and more.
As the programs under ARPA unfold, companies eligible for funding or tax benefits, or subject to any requirements, may wish to speak with counsel about how to take advantage of (or comply with) ARPA’s thousands of provisions.