The $1.9 trillion American Rescue Plan Act of 2021 signed by President Biden includes a number of federal programs that will funnel millions into Pennsylvania businesses but despite its expensive price, it doesn’t allot enough money to keep the state’s businesses impacted by COVID-19 open.
That’s the conclusion of business leaders who were expecting more from the bill.
The act authorizes $7.25 billion of additional funding for the Paycheck Protection Program (PPP) but does not extend the program past its March 31 end date. Any businesses that have yet to apply for either their first or second draw from the program will need to have their application approved by the end of the month and should stay in close contact with their banks, said Gene Barr, president and CEO at the PA Chamber of Business and Industry.
“Make sure you apply and watch the guidance to get the help you need,” said Barr. “I would just encourage people to stay on top of this and understand how you have to apply.”
The act provides billions to a number of grant programs, including $15 billion for the Economic Injury Disaster Loans program that benefits businesses in underserved areas; $15 billion for museums, theaters, concerts and other venues shuttered through COVID restrictions; and $29 billion in grants for restaurants through the Restaurant Revitalization Fund.
It allocates $10 billion for state governments to help leverage private capital and make low-interest loans to small businesses through the State Small Business Credit Initiative.
The rescue package also allots funds to state, county and city governments, of which Pennsylvania is expected to receive $7.3 billion; and local governments another $5.7 billion, according to a report by the Associated Press.
The $29 million for restaurants is a push in the right direction but it won’t be enough for Pennsylvania’s over 26,000 restaurants, said John Longstreet, president and CEO at the Pennsylvania Restaurant and Lodging Association.
The association is asking the state to allot a portion of its federal funding through the act to the state’s restaurant and hospitality industry. Such a move would go farther than the portion expected to arrive from the federal Restaurant Revitalization Fund, he said.
“We have been working with the Pennsylvania legislature to dedicate $1 billion of this state grant money to the hospitality industry,” he said. “Though the Restaurant Revitalization Fund hits the hardest hit segment, it doesn’t help the hotels and other attractions that are part of the tourism industry.”
Neither the act itself nor the Biden Administration have offer details on how direct COVID relief will be split nationally. Clarifying those questions will be a primary focus of the state’s business chambers as they look to communicate to their members how to best access the programs mentioned, said David Black, president and CEO of the Harrisburg Regional Chamber & CREDC.
One of the most frequent criticisms of the act has been how much of the funds are going directly to COVID-19 relief, which is estimated at around $825 billion.
“There’s $35 billion to support ACA premiums, without addressing any systemic failure in the ACA,” said Black. “There’s projects like a bridge connecting New York state and Canada, $500 million for arts, humanities, libraries and museums. As an advocate for responsible government, this is very concerning to me.”
Barr noted that a “free” addition to the act that he would have liked to have seen would have been some sort of liability reform. COVID-19 related legal safeguards for schools, health care and other businesses has been a hot point of debate in Pennsylvania after Gov. Tom Wolf vetoed legislation late last year that would have provided limited protection against COVID-related suits.
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