WASHINGTON, D.C. (KELO) — The Senate has pushed forward a $483 billion deal to fill up the Small Business Association’s Paycheck Protection Program, increase testing and provide relief to hospitals.
The bill was passed in the Senate on Tuesday, it heads to the U.S. House of Representatives on Thursday and then to President Donald Trump’s desk, where it will likely be signed into law.
What does it mean for you?
The primary goal of this bill is: To fill up the PPP after it ran out of money last week.
The PPP provides a loan to businesses with fewer than 500 employees to keep workers on the payroll. The SBA will forgive the loans if all employees are kept on the payroll for eight weeks and the loan is used for payroll, rent, mortgage interest or utilities.
As of April 16, more than 11,000 PPP loans were approved by the SBA for businesses in South Dakota. Those loans totaled more than $1.3 billion for local businesses.
According to data released by the SBA, of the loans already approved industries like construction, professional, and manufacturing are taking the most advantage of the program.
This bill will add $331 billion to the program. That, plus the return of some loans from big businesses like Shake Shack will allow the SBA to begin accepting new applicants, once the bill gets approved, through lenders.
$60 billion will specifically be set aside for small banks, which will support rural efforts to get the PPP loans.
The bill also includes $50 billion in funding for the SBA’s Economic Injury Disaster Loans and $10 billion for grants. This loan advance will provide up to $10,000 of relief for small businesses.
The ag community
Ag producers and agriculture enterprises will now be eligible for the SBA’s EIDL program. That wasn’t clarified in the original bill, but Sen. Mike Rounds (R-SD) said he pushed for it and is glad it is now clarified.
Producers are struggling, especially those in the pork industry after Smithfield Foods Sioux Falls plant was shut down due to a COVID-19 outbreak.
Democrats got one of their requests in the deal. $25 billion will go to boost testing for coronavirus. Something needed as states decide when to re-open economies.
Parts of that package will go to states and Indian Health Service to build up testing programs. The state funding will be based on the number of cases in each state. In addition, the CDC and other federal agencies will receive funding to research a national testing strategy and other options.
Hospitals and health care providers
While they may seem like the busiest of places right now, hospitals and healthcare systems are facing a financial challenge as they cancel lucrative elective procedures to focus on COVID-19 and save in-demand personal protective equipment.
In South Dakota, this has led to furloughs at Avera and Monument Health.
$75 billion will be given to health care providers to help with lost revenue. It’s unclear if that will be enough for the two South Dakota systems to bring back workers.
Gov. Kristi Noem and the South Dakota budget
This deal will not help much for Gov. Kristi Noem (R-SD) as she faces a likely massive budget shortfall for South Dakota. The state relies heavily on sales taxes to fund the government, and with business revenue down, Noem anticipates so will tax revenue.
“Those states that are run responsibly, that use low taxes… are going to be hit the hardest,” Noem said.
The numbers haven’t been released yet from the State of South Dakota showing just how short the state will be.
State and local government funding could be included in future bills or “phase 4,” which is expected in the coming months. Democrats had pushed for state and local funding in this bill, but it didn’t pass. Trump has said he is open to it in the future.
“I’m hopeful that they’ll give us some language that will do that,” Noem said.
Noem said the state’s Congressional delegation have been good advocates for this issue.
This was another push by Democrats: funding for internet connectivity, roads and bridges. The White House has signaled it will be included in the next negotiations.
South Dakota’s senators both support the program. The bill was passed by voice vote, and not a roll call requiring Senators to be in Washington.
The House is expected to do a roll-call vote on Thursday. Rep. Dusty Johnson (R-SD) is already back in Washington. He posted a video on social media asking for South Dakotans input.
Read the full bill