Working from home? Switch to the DIGITAL edition of Stage Directions. CLICK HERE to signup now!
Generic selectors
Exact matches only
Search in title
Search in content
Search in posts
Search in pages

Urge Senate and Congress to Revise the HEALS Act Proposal and Include FULL Support for the Arts in the Next Coronavirus Relief Package

Stage Directions • Industry News • July 29, 2020

Here’s information on the current coronavirus relief package and ways in which it could better support the nonprofit arts sector. We encourage you to review the provisions of the relief package and write to your congressional representatives, urging them to address the needs of the Performing Arts communities.

[Ed. Note: This breakdown of the HEALS Act was done by OPERA America] U.S. Senate Republican leadership released the Health, Economic Assistance, Liability Protection, and Schools (HEALS) Act on July 27 as a marker to begin negotiations on the next COVID-19 pandemic relief package. The $1 trillion proposed package was designed to follow-up on the $2 trillion Coronavirus Aid, Relief, and Economic Security (CARES) Act, enacted in March 2020, to help support governments, businesses, communities, and families negatively impacted by our nation’s the country’s public health response to the pandemic, including lockdowns and reductions in various services. U.S. Senate Republican leadership has indicated that this will likely be the last pandemic relief package to be considered beyond regular appropriations (spending bills) that are passed by Congress each fiscal year.

It is important for everyone in the overall arts sector to work together to ensure that the arts  receives the support it needs to address its challenges during this pandemic and to bounce back to further strengthen the U.S. global economy and the specific communities and families they serve. Leaders on both sides of the political aisle have indicated their desire to agree on a relief package by the end of the first week in August.

Below are key provisions of the HEALS Act and additional information:

Emergency Appropriations (funding): Provides $306 billion in emergency appropriations, including $105 billion for education, with $70 billion for K-12 schools, $29 billion for higher education institutions, and an additional $5 billion for governors to distribute to either K-12 schools or higher education institutions.

Second Round of Stimulus Payments: Provides another round of direct stimulus payments to American households identical to the payments provided under the CARES Act, specifically $1,200 for single taxpayers and heads of household and $2,400 for those married filing jointly. Like the CARES Act, the payment would phase out at 5% per dollar of qualified income above $75,000 for singles, $112,000 for heads of household, and $150,000 for joint taxpayers.

Restructured Federal Pandemic Unemployment Compensation: The CARES Act provides for $600 per week in federal unemployment compensation in addition to the state unemployment compensation through July 25. The HEALS Act decreases that benefit to $200 per week through September 2020. Starting October 2020, the payment would be replaced with an overall payment that is up to 70% of a recipient’s lost wages (capped at $500 per week).

Paycheck Protection Program (PPP) Expansion: Rescinds $100 billion from the Program in the CARES Act and provides another $90 billion to support new and “second draw” loans designed for eligible small businesses and nonprofit organizations with fewer than 300 employees that have experienced at least a 50 percent reduction in lost revenues. Eligible entities would be able to secure a new or “second draw” loan equal to 2.5 times the total monthly payroll costs up to $2 million. New loans are forgivable if at least 60% of the loan is used to cover payroll costs. “Second draw” loans would be eligible for loan forgiveness equal to the sum of payroll costs, covered mortgage, rent, utility payments, covered operations expenditures, covered property damage costs, covered supplier costs, and covered worker protection expenditures before January 1, 2021. The proposed package provides eligibility for self-employed individuals, sole proprietors, independent contractors, and seasonal employers. It provides up to $100 billion for the Small Business Administration to provide low-cost, long-term loans (20 years of maturity with 1% interest rate) to “recovery sector businesses,” defined as seasonal businesses and businesses located in low-income census tracts. Eligible entities can borrow up to twice the borrower’s annual revenue up to $10 million. Eligible entities must have fewer than 500 employees and experience at least a 50% decline in lost revenue.

Increased Employee Retention Tax Credit (ERTC): Increases the refundable payroll tax credit from 50% to 65% on certain wages paid by employers to employees during the pandemic. Expands eligibility to entities with 500 employees or less. Eligible entities would also be able to claim both PPP and ERTC, but it contains provisions to prohibit double-dipping of both benefits for the same payroll costs. The proposal increases the amount of wages that can be claimed from $10,000 per year to $30,000 per year, limited to $10,000 per quarter.

Work Opportunity Tax Credit (WOTC) Expansion: Temporarily expands the work opportunity tax credit (WOTC) to employers hiring individuals defined as 2020 qualified COVID-19 unemployment recipients. The credit would be expanded from $2,400 (40% of the first $6,000 of qualified first-year wages) to $5,000 (50% percent of the first $10,000 of qualified first-year wages).

New Refundable Payroll Tax Credit for Coronavirus Expenses: Establishes a new refundable payroll tax credit equal to 50% of an employer’s qualified employee protection expenses, including coronavirus testing, cleaning supplies, and protective protection equipment. The maximum amounts to $1,000 for each of the first 500 employees, $750 for each employee between 500 and 1,000 employees, and $500 for each employee over 1,000 employees.

Liability Protection: Provides liability protection for businesses, schools, universities, and hospitals from coronavirus-related lawsuits through October 1, 2024, if they make reasonable effort to comply with public health guidelines and do not engage in gross negligence.

Aid to State and Local Governments: Provides NO funding for state and local governments to address current and future budget shortfalls. However, the bill provides increased flexibility for state and local governments to use existing $150 billion in funding under the CARES Act to address budget shortfalls only from the 2019 fiscal year. States must provide at least 25% of their funding to local governments for states to use their funding to address budget shortfalls.

WHAT IS MISSING?

  • The HEALS Act does not contain provisions from the UNIVERSAL GIVING PANDEMIC RESPONSE ACT (S4032/HR7324). These bipartisan bills would expand the current above-the-line deduction for charitable giving created under the CARES Act, lifting the $300 cap on the universal charitable deduction to $4,000 for individuals and $8,000 for couples.
  • SAVE OUR STAGES ACT: Establishes a $10 billion Small Business Administration grant program to provide 6 months of financial support to commercial and nonprofit performing arts venues, agents, and producers.
  • RESTART ACT: Establishes a loan program to help small and mid-sized businesses through the rest of the year, providing funding for 6 months of payroll, benefits, and fixed operating expenses. A share of the loan will be forgiven based on the revenue losses suffered by the business in 2020 with the remainder to be repaid over 7 years. No interest payments are due in the first year, and no principal payments are due for the first 2 years.

MAJOR CONGRESSIONAL ASKS

  • Urge Congress to expand and recapitalize the Paycheck Protection Program (PPP) resources, provide new opportunities for those that have exhausted initial PPP funds, and ensure eligibility for nonprofits of all sizes to support the arts workforce and its service to communities.
  • Urge Congress to ensure that tax credits take the form of refundable payroll tax credits to support full nonprofit eligibility, and that tax credits are compatible with access to PPP funding and other forms of federal relief.
  • Urge Congress to immediately expand the duration of Federal Pandemic Unemployment Compensation and improve guidelines for Pandemic Unemployment Assistance to better support musicians and other gig economy workers with mixed W-2 and 1099 income sources. Urge Congress to increase the federal unemployment insurance reimbursement for self-funded nonprofits to 100% of costs.
  • Urge Congress to incentivize new and increased charitable giving by including an expanded Universal Charitable Deduction in the next relief package
  • Urge Congress to include federal funding that will support the arts sector and its service to communities, support a complete education for all students through federal education funding and distance learning resources, provide relief administered through state and local governments, and adopt an emergency broadband benefit to support more equitable participation in artistic, educational, and cultural activity taking place online

Please take a few minutes to send a communication to your U.S. Representatives and Senators to urge them to address the needs of the arts sector and especially the opera community. You can tailor the existing message in the alert to lean in with your personal voice and to tell your story how the pandemic has impacted your livelihood.

PLEASE ACT TODAY AND SPREAD THE WORD! WE NEED YOUR VOICE!

WRITE TO YOUR MEMBERS OF CONGRESS

CURRENT ACTION ALERT

Thank you to all for your ongoing advocacy on behalf of the performing arts.

The Latest News and Gear in Your Inbox - Sign Up Today!