The American Rescue Plan

Support for Small Businesses and Nonprofits

The American Rescue Plan (ARP) is, to my mind, one of the most significant pieces of legislation for working families in the modern history of this country. From $1.3 billion in direct aid to state and local governments; checks for individuals; and, critical investments in housing, health care, and education; this new law addresses the very real needs of Vermonters. I will be working hard in the coming weeks and months to ensure this relief gets to all who need it, in every corner of our state.

Importantly, this law includes significant assistance for our small businesses. In Vermont, 96% of businesses are classified as small businesses, employing over 155,000 Vermonters in good paying jobs. Businesses in Vermont and throughout our country continue to struggle and many have been forced to change their operations or shut their doors completely during this crisis.

This week, I met with some of our small businesses to discuss their experiences during the pandemic, the new assistance that is available through the ARP, and what they need going forward to sustain their operations and strengthen our local economies. It is clear that these businesses, and many, many more throughout our state, are facing serious economic challenges. We must ensure they know how to access the many federal programs that have been put in place to help them, and we must listen to their needs to provide the support that will help them thrive long after this crisis is over. Thank you to all of the small business leaders who participated in this discussion and to each and every Vermonter who joined the conversation. If you missed the live event, you can watch our discussion now to hear directly from these Vermont small business owners.

The ARP expands programs like the Paycheck Protection Program, provides more funding for the Economic Injury Disaster Loan and the Shuttered Venue Operators Grant programs, and creates a new direct relief grant program for restaurants. While the ARP is a major step forward, we have an enormous amount of work to do to protect our small businesses. Please know that I will continue to fight for the support our small businesses need.

Read on to learn about the additional assistance that is now available to small businesses as well as many nonprofit organizations through the ARP. If your business needs any help with federal programs, or if you have questions about how this legislation impacts you and your family, please do not hesitate to contact my office by phone at 802-862-0697 or 1-800-339-9834, or on our website.

$15 Billion for Targeted Economic Injury Disaster Loan Advance Grants (EIDG)

Economic Injury Disaster Loan Grants (EIDG)

The CARES Act, the federal stimulus law enacted in March of 2020, funded the Economic Injury Disaster Loan (EIDL) program to provide immediate relief to help small businesses and nonprofits with operating costs. This program provides advance grants of up to $10,000 for businesses that apply for a loan, and the grant does not need to be repaid. Unfortunately, many small businesses that applied for an EIDL did not receive the full grant, or did not receive a grant at all. This new federal stimulus law, the ARP, adds $15 billion in new funding for targeted EIDL grants (EIDG) to provide up to $10,000 to businesses who previously did not receive their full grant amount. This funding is specifically being offered to hard-hit, underserved small businesses. 

• Eligible applicants do not need to take action. The U.S. Small Business Administration (SBA) is reaching out to those who qualify.
• To find more information, visit: https://www.sba.gov/document/support-faq-regarding-targeted-eidl-advance. 

Economic Injury Disaster Loans (EIDL)

Eligible businesses, including agricultural businesses, and private nonprofit organizations can still apply for an EIDL of up to $500,000.

• To find more information, visit: https://www.sba.gov/funding-programs/loans/covid-19-relief-options/covid-19-economic-injury-disaster-loan.
• To apply for a EIDL, visit: https://covid19relief.sba.gov/#/.
• If you need assistance, you can find your local SBA office and resource partners at: https://www.sba.gov/local-assistance/find. You may also call 1-800-659-2955. 

SBA has also announced extended deferment periods for all disaster loans, including the EIDL program, until 2022. 

• All SBA disaster loans made in calendar year 2020 will have a first payment due date extended from 12 months to 24 months from the date of the note. 
• All SBA disaster loans made in calendar year 2021 will have a first payment due date extended from 12 months to 18 months from the date of the note. 

$7.25 Billion for the Paycheck Protection Program (PPP)

The CARES Act created the Paycheck Protection Program, a forgivable loan program to help businesses maintain their existing workforce and pay for other expenses like rent, mortgage interest, and utilities during the pandemic. The federal appropriations bill passed in December 2020 allowed businesses that had at least a 25% revenue loss to apply for a second PPP loan. The ARP provides an additional $7.25 billion for the PPP program and extends the application deadline to May 31, 2021. The eligibility for the program is also expanded to include additional nonprofits such as 501(c)(5) labor and agricultural organizations, and digital news services. 

• If you have not received a PPP loan before, find more information and apply here: https://www.sba.gov/funding-programs/loans/covid-19-relief-options/paycheck-protection-program/first-draw-ppp-loan.
• If you have previously received a PPP loan, find more information and apply for a “second draw” loan here: https://www.sba.gov/funding-programs/loans/covid-19-relief-options/paycheck-protection-program/second-draw-ppp-loan.
• Find a list of participating lenders by state here: https://www.sba.gov/PaycheckProtection/find. 
• For the most up-to-date guidance on the PPP program, visit: https://www.sba.gov/document/support-faq-ppp-borrowers-lenders.
• For assistance with your application, contact the Vermont Small Business Development Center at 802-728-9101 or 800-464-7232, or fill out this form: https://www.vtsbdc.org/register/.

$28.6 Billion in Direct Relief for Restaurants

Nationally, the restaurant industry has been among the hardest hit during the pandemic—and it is no exception in Vermont. The ARP provides $28.6 billion in direct relief to restaurants through a new grant program, the Restaurant Revitalization Fund Grants program. $5 billion of this allocation is set aside specifically for small establishments with gross annual receipts of less than $500,000. Grants can be used for payroll costs, rent and utility payments, mortgage interest, supplies, and paid sick leave. The Small Business Administration is currently developing the program. Eligibility and application information will be made available soon.

For updates on this program, visit the SBA COVID-Relief Options site here: https://www.sba.gov/funding-programs/loans/covid-19-relief-options.

$1.2 Billion for the Shuttered Venue Operators Grant Program (SVOG)

The December 2020 federal appropriations bill created the Shuttered Venue Operators Grant (SVOG) program to help operators — live venues, independent movie theatres, concert halls and cultural institutions — cover payroll costs, rent, utilities, and other expenses. Given that the initial $15 billion allocated for the SVOG program is estimated to be insufficient to cover all eligible applicants, the ARP provides an additional $1.25 billion for the program. Applicants can access both the SVOG and PPP programs to receive assistance. The application for the SVOG program opened this week, on April 8.

• Apply here: https://www.svograntportal.sba.gov/s/.
• Find more information here: https://www.sba.gov/funding-programs/loans/covid-19-relief-options/shuttered-venue-operators-grant.

Vermont Sole Proprietor Stabilization Grant Program

In 2020, the State of Vermont established the Sole Proprietor Stabilization Program using $1.5 million of Community Development Block Grant (CDBG) program funds provided through the CARES Act. The first round of grants were awarded to sole proprietors in August of 2020. A second round of grants has just launched using $1.6 million of CDBG funds to provide grants between $1,500 and $10,000 to qualifying sole proprietors on a first come, first served basis. The application is open now through May 26. 

• For more information and to apply visit: https://www.vermont-cdbg-cv.com/.
• If you are located in the following counties your grant will be administered by the Two Rivers – Ottauquechee Regional Commission and you can submit questions to CDGB-CV@trorc.org: Windsor, Orange, Caledonia, Essex, Orleans, Franklin, Grand Isle, and Chittenden.
• If you are located in the following counties your grant will be administered by the Brattleboro Development Credit Corporation and you can submit questions to CDGB-CV@brattleborodevelopment.com: Windham, Bennington, Rutland, Addison, Washington, and Lamoille.

Refundable Tax Credits

Paid Sick Leave Credit

The ARP provides an extension and expansion of the paid sick and FMLA leave tax credits created in the Families First Coronavirus Response Act of 2020. It provides payroll tax credits for employers who voluntarily provide paid leave to their employees through the end of September 2021. It also expands eligibility to state and local governments that provide this benefit. 

Find more information here: https://www.irs.gov/newsroom/covid-19-related-tax-credits-for-required-paid-leave-provided-by-small-and-midsize-businesses-faqs.

Employee Retention Tax Credit

The ARP extends and expands the Employee Retention Tax Credit (ERTC) through December 31, 2021. The ERTC, originally enacted in the CARES Act, helps struggling businesses retain and rehire workers. The bill expands the ERTC to allow certain severely distressed businesses to claim the credit for a greater share of wages paid to employees. It also expands the credit to cover newly formed businesses to help spur hiring and speed the recovery of local economies.

Find more information here: https://www.irs.gov/newsroom/irs-provides-guidance-for-employers-claiming-the-employee-retention-credit-for-first-two-quarters-of-2021.

Tax Treatment of Certain SBA Programs

The ARP provides for the tax-free treatment of Targeted EIDL Advances and Restaurant Revitalization Grants. It also clarifies that any otherwise-allowable deductions continue to be deductible notwithstanding the tax-free treatment of grant proceeds.

Find more information about tax relief for businesses here: https://www.irs.gov/coronavirus/coronavirus-tax-relief-for-businesses-and-tax-exempt-entities.

You can find additional help by contacting the following organizations and agencies:

• Vermont District Office of the SBA holds weekly webinars on various aspects of federal assistance programs. Sign up for their newsletter to receive updates on the PPP and Shuttered Venue Operators programs: https://www.sba.gov/offices/district/vt/montpelier.
• Vermont Small Business Development Center (VtSBDC) provides free support for grant applications, including the new Shuttered Venue Operators Grant program: https://www.vtsbdc.org/.
• Vermont SCORE can assist with EIDL applications. Call 802-764-5899 or email: champlain.valley@scorevolunteer.org. Visit their website: https://vermont.score.org//.
• The Center for Women and Enterprise can assist women-owned businesses: https://www.cweonline.org/About-CWE/CWE-Vermont.
• Vermont Agency of Commerce & Community Development has launched a COVID-19 Resource Recovery Center: https://accd.vermont.gov/about-us/disaster-planning/covid-19-guidance-vermont-businesses.
• Vermont Department of Labor has resources and updates here: https://labor.vermont.gov/covid19.