Feds “Very Close” to $350 Billion More in CARES Act Funding!: COVID-19 Transportation Update – Monday, April 20, 2020
The White House and Congress are “This Close” to Funding Loans for Transportation Companies and Independent Contractors!
Treasury Secretary Steven Mnuchin and Congress are expected to approve measures to replenish funds for 2 key loan programs. As part of the CARES Act enacted last month, transportation companies and independent contractors were able to seek relief through the Paycheck Protection Program (“PPP”), which allocated $349 billion for low-interest, forgivable loans to help small businesses impacted by the COVID-19 crisis. The PPP loans were to provide small businesses with loans to pay eight weeks of salary, benefits and other eligible costs. Many transportation companies and independent contractors immediately filed for the PPP loans as soon as they became available. Small businesses filed as of April 3, 2020, and independent contractors were able to file as of April 10. But, in less than 2 weeks, the PPP loan funds were exhausted. At the same time the PPP loan funds were exhausted, the U.S. Small Business Administration (the “SBA”) program for the Economic Injury Disaster Loans (“EIDLs”) also ran out of money. The EIDL also included up to $10,000 as an advance/grant to the loan applicant.
- Under the most recent proposals being floated today, Congress will allocate an additional $50 billion for the EIDL program. Mnuchin disclosed that the legislative package he was discussing with Congress could include $300 billion in additional funds for PPP loans. This legislative package is separate from the fourth federal stimulus law that is separately being discussed. This is known as CARES 2.0, and may include direct relief and tax incentives.
For those transportation companies and independent contractors with an interest in applying for the PPP loans as the program is replenished, we have updated the resource guides to include the most recent information from the SBA:
- Updated the FAQs for PPP Loans based on the new SBA guidance for independent contractor-drivers can be found here.
- Updated Checklist and Worksheet/Calculator for PPP Loan applicants can be found here.
New Jersey Passes Law To Pay School Bus Contractors Sidelined by COVID-19!
On April 14, 2020, New Jersey school bus contractors received significant help when the State enacted a new law for school districts adapting to the COVID-19 lockdown. The new law allowed for school districts to submit plans to achieve 180 days of instruction for the 2019-20 school year, including adopting remote learning programs due to COVID-19. For school bus contractors, there was some welcome help in the new law. NJ Assembly bill A3904 (as amended by the Senate on April 13, 2020) included a last-minute addition that specifically requires school districts to make all reasonable efforts to renegotiate a contract in good faith...to meet the payroll and fixed costs obligations of the contracted service provider.” Transportation Practice Group staff at Windels Marx are representing several school bus operators in multiple states to renegotiate contracts with government entities or to seek compensation for school bus providers under existing agreements. If your school bus company needs help or representation on such matters, reach out directly to Matt Daus at email@example.com or 212-237-1106.