Steve Richer, Washington Correspondent

In an amazing bipartisan vote of 96-0 (four Senators being isolated due to two with the Covid-19 virus and two for observation), the United States Senate approved a massive, over 800 page bill with $2.2 trillion in new funding to address major issues caused by the novel coronavirus pandemic.

The House is certain to vote on this legislation on Friday morning by either voice vote (to provide the option of not requiring all members to be in Washington) or, if necessary due to some objections from recalcitrant members, by a recorded vote. President Donald Trump has announced that he will immediately sign the bill.

The passage of this bill, the CARES (Coronavirus Aid, Relief, and Economic Security) Act, S. 3548, follows almost a week of highly partisan rhetoric and posturing between the political parties and their advocates that each side was not seeing the urgency of the situation, only cared about certain special interests, or was loading the bill with irrelevant “goodies” unrelated to the pandemic. Ironically, this was all happening while both sides were strenuously and effectively engaged in serious negotiations led by Senate Majority Leader Mitch McConnell of Kentucky, Senate Minority Leader Chuck Schumer of New York, Treasury Secretary Steven Mnuchin, and Congressman Mark Meadows of North Carolina, White House Chief of Staff-designate.

The bill was subject to intensive lobbying from numerous sectors of the national economy, including the travel industry, which sought relief for major industry elements, such as the airlines and hotels, small businesses which comprise most of the industry, and the industry’s employees, many of whose jobs were in precarious situations.

It is clear today that the lobbying efforts have paid off! Much credit goes to the leadership of the travel industry, including our own association for standing together with one consistent voice. US Travel and its president, Roger Dow, did yeoman’s work by getting a White House meeting with President Donald Trump, Vice President Mike Pence, and Commerce Secretary Wilbur Ross just before the legislative wheels started grinding.

So what is the good news for international inbound operators and our industry associates?

Here are some of the elements contained in the CARES Act.

  • $500 billion in loan funds for business. $377 billion will be loans and loan forgiveness for small travel business, including 33,000 hotels with 1,000 or less employees. Based on a discussion yesterday with the Small Business Administration and its Economic Injury Disaster program, small businesses are likely to be able to borrow up to $2 million for normal expenses at 3.75 per cent per annum, not payable for one year initially, for up to thirty years. Normal expenses can include payroll, leases, overhead, etc. Non-profits can secure loans at 2.75 per cent.
  • $50 billion to stabilize the airlines. $25 billion of this is available in the form of loans; the other $25 will be grants. Another $8 billion is included for cargo carriers.
  • $454 billion in federally backed financial assistance for impacted businesses. The Treasury Department and Federal Reserve will provide loans and loan guarantees to assist small businesses and governmental entities funded through the crises to keep employees and stay afloat. This includes travel industry businesses and destination marketing organizations.
  • Tax deferrals. The bill allows temporary tax liability relief, new Employee Retention Tax Credits, accelerated renovation tax write offs, and a carryback on Net Operating Loss (NOL) Deductions.
  • $347 billion employee retention fund. This provision allows employees to be furloughed, be paid full salary and benefits by the federal government for up to four months and be part of any company’s existing staff when things return to normal.
  • Enhanced unemployment benefits. Federal unemployment benefits of $600 per week for up to four months will be added to state unemployment benefits to those who have been laid off, rather than furloughed.
  • Direct payments. Based on current income, individuals will receive one time payments of $1200 plus $500 for each child. The amount is reduced for incomes over $75,000 and stops for incomes over $99,000.
  • Special appropriations. Travel attractions, such as the Smithsonian Institute and Kennedy Center, will receive extra funding in the bill.
  • $10 billion for airports. Special funding is included for airport operations.

This comprehensive legislation also addresses other major indirect issues of interest to the travel industry, including funding for the operation of hospitals and expanded medical care and the continuation of operations of local government which is offering its own tax deferrals.

This is only an initial analysis, so IITA members should look forward to more information, including how to apply and receive funding described here. SBA, for example, wants its applications on line and is minimizing some normal business proofs to accelerate distribution of funds by using “self certification”.

This summary was gathered from reports issued since midnight, including a travel industry focused one issued by US Travel. It is exciting to know that all four IITA priorities were addressed in this legislation–tax deferrals and adjustments, low interest loans, grants, and, most importantly, support for employees.

IITA members are encouraged to call the offices of members of Congress, main switchboard is 202-224-3121, just ask for a specific Senator or Representative by name and state. When you reach them, please thank them for their support of the CARES Act. If you are calling today on the House side, ask your representative to support it on Friday.

Finally, if you want to thank the sponsors of the Senate version. S. 3548, of the CARES Act, here are the chief sponsors–Senators Mitch McConnell of Kentucky, Lamar Alexander of Tennessee, Mike Crapo of Idaho, Chuck Grassley, of Iowa, Marco Rubio of Florida, Richard Shelby of Alabama, and Roger Wicker of Mississippi. It would be especially meaningful if you are from one of these states!

Have a safe and healthy day… and stay socially isolated, if possible.