“We are trying to make sure that we preserve our economy, that we preserve workers and their families and their abilities to pay their bills.”
“We need to get the information out to the small businesses, to the workers, and to all businesses. We are here to help keep them open, to keep the paychecks flowing, to keep our economy moving.”
WASHINGTON – U.S. Senator Ben Cardin (D-Md.), Ranking Member of the Senate Small Business and Entrepreneurship Committee and a senior member of the Senate Finance Committee, spoke from the floor of the U.S. Senate on Wednesday, prior to unanimous passage of the COVID-19 stimulus package, to highlight how this latest package will help inject capital into the hands of the American people and help keep them employed by supporting small businesses during this difficult time.
“The people in this nation are hurting. We know that. They are very concerned about their own health. They’re worried that they may be carrying the virus and they might take it home to their elderly parent who could come down with the virus. They are worried about how long this social distancing, communicating from home and staying at home is going to be required in order to control the spread of the virus. They’re worried about their economic circumstances and whether they’re going to get a paycheck.
“I am pleased that today we have an agreement with our leaders to move forward on the third stimulus package to deal with this COVID-19 crisis.
PRIORITIES: PUBLIC HEALTH AND WORKERS
“I first want to express my appreciation to our leadership. I have been in daily, almost hourly, communication with Senator Schumer. I know how hard he has worked to make sure that this package really responds to the medical emergency that we have before us. He wanted to know that it helps ensure workers are protected and that this bill provides the help for state and local governments. It does provide the much-needed attention to these particular issues. We also have accountability on any of the moneys that are going to be distributed, particularly to our largest companies in this country. For all of this, I want to express my appreciation.
“I am very pleased that our first priority, our very first priority, is to deal with the public health challenge before us. This includes what is happening in my state of Maryland and what is happening in every state in our nation. In our state, I am pleased that it is ‘Team Maryland.’ Our congressional delegation is working very closely with Governor Hogan and his cabinet. We are working very closely with our county executives and our mayors and our private sector to do everything we can to protect the public health of the people of our state. We have done what we can locally to make sure testing is available so we can better understand the dimensions of this problem. The governor has taken extraordinary steps in order to increase our medical capacity in the likelihood that we are going to see a significant increase number of those people that have the coronavirus (COVID-19).
“We need to stay at home unless it is an urgent reason for us to be outside of home. I am frequently asked by my friends, ‘why don’t we do as much as we can in the United States Senate remotely?’ I think we should, including voting. We need to distance ourselves and minimize social contact in order to prevent the spike of this virus, which would test our medical capacity.
SUPPORT FOR MARYLAND HOSPITALS
“I was pleased that the third supplemental, the agreement that’s been reached that we will vote on hopefully today, that it does have a surge in our medical capacity – a Marshall plan to deal with our health care needs. I could go through many of the specifics. I think some have already gone through but I particularly appreciate the fact we have $100 billion for our hospitals and health care facilities, including clinics in this bill. I am pleased that there is a 20% increase in Medicare hospital reimbursement rates. I want to thank Senator Grassley and Senator Wyden for including in that provision a unique clause for the Maryland hospitals so that they can qualify for this. Maryland has, as I think some of you know, an all-payer rate structure. We had to make sure these provisions would apply in Maryland. I thank these senators for their attention to that detail.
“There also is money in this package for our hospitals for preparedness, which I think is extremely important. There is a separate appropriations line for our community health centers and our federally-qualified health clinics, which are critical. These facilities are being stressed, as the needs are increasing and as the cost of treatment is increasing.
“We also need to replenish the national stockpile. We know there are serious concerns about protective gear. We know that ventilators and respirators are in short supply. We have to make sure we have adequate replacement of what is being taken out of our national stockpile and available now to deal with the surge that is coming, so that our health care workers have the protective gear that they need and our patients have the medical facilities and the respirators that they need.
“We also have plussed up the work on the development of a vaccine. I am pleased that the National Institutes of Health (NIH) is getting the money that they need in order to do this work. We know that we’re not going to have a vaccine in time this year, but we want to make sure we get it as soon as possible. It is on a fast track and these funds will help us develop that vaccine for the future needs of controlling this type of a virus.
“In the meantime, we’re also putting resources into therapeutic drugs, drugs that can help people that are sick today. Those drugs are not yet available, but we want to make sure we do everything we can to make them available as soon as possible.
FEMA/AID TO STATE AND LOCAL GOVTS
“The Federal Emergency Management Agency (FEMA) has been bumped up substantially in this bill – for good reason. This was a major improvement to this legislation. Our state and local governments are on the front lines of providing public health needs. We need to provide them the federal resources they need. We have appropriations to help FEMA and direct help to our local governments. We see that our state and local public health officers are getting extra money and it comes with federal reporting so we know exactly what the status is in each of our communities. All that is important for our Marshall plan to get this disease under control.
SMALL BUSINESS PRIORITIES
“I wanted to take this time to talk about small business. I recognize that we have got to get our economy back on track. What is the best way to do that? To get this virus controlled. When the time is right, we want to get people back to work, and to buy and participate in our economy. These are the best things we can do. But this package also recognizes that unless we help businesses and workers today, we’re not going to be prepared for our economy when we are able to rebound.
“My role as the senior Democrat on the Small Business Committee, working with Senator Rubio, the chairman of that committee, was to make sure we had a robust provision to preserve the growth engine and innovation engine of our economy, and that is small businesses.
“There’s more job growth for small companies. There’s more innovation in small companies. We need to preserve the ability of small companies to get through this time. And quite frankly, they don’t have the same deep pockets that large companies have. They don’t have the same availability of credit that large companies have. They don’t have the same banking arrangements that large companies have. They don’t have the same flexibility that large companies have. We have to provide special attention to small businesses and this package does that in a very, very robust way.
“First, I already mentioned Senator Rubio. I thank him for his leadership. The two of us were working together well before this week. And that’s why we were probably further along on helping small businesses than the other parts of this package dealing with the various economic areas. Senator Shaheen was a valuable member of our team. I’ve worked with Senator Shaheen on small business issues for a long time. She was a key player in putting together the package that we have. I also want to acknowledge Senator Collins. It was the four of us that were meeting regularly, communicating regularly and we recommend this package that we will shortly be voting on as it relates to small business.
“I would also like to acknowledge members of my own staff that have worked literally 24/7. I’ve talked to them at various times during the night and day. It’s been very stressful for all of us. Our staffs get no rest whatsoever. So, to Sean Moore and the entire staff on the Democratic side of Small Business Committee, thank you on behalf of America’s small businesses and workers, and on behalf of our country.
“To Ron Storhaug, who has been doing a lot of these provisions in regards to the tax issues and many others, I thank him for all of his work. To Lauren Jee, who has not only helped us put together the small business package, but she’s been available to help Maryland health providers and patients to try to get to where we are today. All their work is reflected in the bill that we will be voting on later.
“I know also on the Republican side there’s been dedicated staff who have done equal work to make sure that we have a bill that we can present today.
SMALL BUSINESS GRANTS
“Let me go over, if I might, some of the provisions that we have in here for small businesses. We have three new programs to help small businesses in our community. They will have different titles, but every one of them provides grant help to small businesses.
“I am going to repeat. You might hear this is a loan. No, these are going to be funds that go to small businesses that do not have to be repaid. These are grant funds. Why? Because a small business owner can’t incur more debt today when they have no idea how they are going survive in the future. We have got to provide immediate help. It has to be substantial. And it has to be in such a way that they know that they’re not encumbering their future. We’ve got to get that message out: This is going to be immediate help to help America’s small business.
“One program provides $350 billion of relief to small companies under 500 employees. Three hundred and fifty billion. It is triggered by going to your financial institution and getting what is known as a 7(a) loan. Let me caution you. It’s going to be forgiven if you follow the rules here. But you go to a bank, a financial institution. You do a 7(a) loan that is 100% guaranteed by the government so the bank has no risk factor. There are no payments due for a year. Even getting into this loan, there are no obligations for cash outlays on behalf of the borrower. The fees have been waived. So this is a cost-free opportunity to get the cash you need to keep your small business open. That’s the purpose of this new program under the Small Business Administration (SBA).
“What would be the amount of the loan/grant? You take your average monthly payroll before the coronavirus was here and multiply it by 2.5. Basically, what you are getting is two months of payroll for your workers, plus an extra 25%.
“What can you use this for? Well, you can use the two months for payroll. Pay your workers. Keep them employed. It saves you the cost of rehiring if you had to furlough or lay off workers. You can keep them employed. You can use the extra funds to cover their expenses that you have on their health care or other expenses. You can use the extra 25% for rents or mortgage payments or utility bills. So, it gives you a cash to conduct your business for the next two months. It gives you the ability to keep afloat so that you are ready to rebound when the economy rebounds.
“Who is eligible? Companies under 500, yes, but we went beyond the traditional 7(a) eligibility. We are also allowing nonprofits to get into this program so that they will also be able to stay afloat, because we know the important work that nonprofits do for our community. We gave some relaxation to the 500 rule for locations for restaurants or hotels that have multiple locations.
“This is a program that’s aimed at keeping businesses open and ready for when we get through this coronavirus. Then, this amount of money that you borrowed is totally forgiven. Totally forgiven if you maintain your workforce to the pre-coronavirus level or bring back your workforce to the pre-coronavirus level during the stated period of time of this bill. If you keep your work force or bring back your work force, the government’s going to help you maintain your ability and make sure your workers get paid and their benefits are maintained. It works very well with the other provisions that are in other parts of this bill, such as the unemployment insurance benefits.
“Yes, if you furlough workers, you can collect unemployment benefits at basically full salary for the next four months. That is also available to small businesses. But we want you to also know that you can keep your employees employed, there, ready for the business to rebound, as we hope it will shortly. That’s just one program. We have other programs available.
“We have a new program which is labeled as a grant, a $10 billion grant program for emergency cash availability for small businesses. There are businesses that have a hard time going to a bank and getting a commercial loan. There are many small businesses that need cash today. They can’t wait for that process to work its way through to get that check from the Small Business Administration through one of their financial institutions. It’s going to take a little bit longer for them to be able to get that done. We had emergency disaster relief loans in the first supplemental. We made it clear that small businesses qualify for emergency disaster relief loans if they have been adversely impacted by the coronavirus. These are direct loans coming out of the SBA. These are not loans from financial institutions. We included that in the first supplemental.
“What we have now is that we allow you to make that application and, with that application, if you need to get cash immediately, the SBA can write you a check for up to $10,000. We want that done within three days. We want that money out in days, not weeks. We hear that all the time from small businesses. We need help now. I was pleased to work on this program. I filed legislation on it. This is a need out there today and will be available to small business owners.
EXISTING SBA LOAN FORGIVENESS
“(1) You can get this basic two-month help from the federal government to pay your payroll and related expenses. (2) You can get a $10,000 immediate cash advancement on that through applying for disaster relief loan and showing a need at this stage. There is a third program for the many small businesses today that have existing loans under the Small Business Administration. These are 7(a) loans or 504 loans. 7(a) is the traditional loan. 504 are larger loans. What this bill does is provide $17 billion of relief so those who had existing loans do not need to make any payments on those loans. They are forgiven for the next six months.
“I particularly want to acknowledge Senator Coons’ work on this. This is a bill that we have been working on and is only reasonable to relief. We are asking others to relieve debt. Let us do it for our small businesses under the 7(a) and 504 programs.
CONTRACT WORKER PROTECTION
“There are many provisions here that help our small businesses. I want to tell you that there are others in addition to those three that I just mentioned. I am pleased that we do have contract protection in this bill. Let me explain what that means. This applies to all businesses, not just small businesses. But small businesses are particularly impacted by it. For example, if you can’t perform that government contract because you can’t get access to the facility because it’s shuttered as a result of the coronavirus. This bill allows you to make sure you have adequate funds available to pay your workers so that those individuals who should have been working at the federal facility will get paid during this period of time.
“We also provide money for the minority business development centers that are in our communities. Why? Because we have to get the message out to small businesses about these new tools, how they can access banks to get the 7(a) loans that are forgiven — that are actually grants. How they can apply to the SBA for disaster relief loans and get a cash advance. How they can get relief from the current 7(a) and 504 loans. So, we give money to these institutions, these entrepreneur service groups, so they can help women businesses and minority businesses get access. I must tell you, we also have put a clear intent that we expect financial institutions to make loans to all sized small businesses in all communities so that all communities can benefit from this legislation. We have increased the size of express loans under this.
“I want to compliment the work of other working groups, particularly on the tax provisions. I was very pleased to work with Senator Wyden. The two of us worked on what is known as a retention credit. I also want to acknowledge Senator Warner who was very instrumental in getting that provision adopted.
“There is a whole range of tools in here to keep small businesses operating and paying their workers so they don’t have to reinvent their employees after this crisis is over. They can keep qualified people. They get the paychecks and our economy is ready to get back into shape.
“There are many other provisions in this bill, including the cash payments under the IRS — $1,200 per taxpayer — that will help. When you put this all together, this is a robust package to hold our economy so that it can perform when it is ready to take off again, without the dire consequences of people not having income in order to pay their bills.
“Through these small business provisions, small business owners can keep their businesses intact. Through unemployment insurance, those that are laid off or furloughed would get their salaries. Through the IRS checks, people will have some cash. Through some of these other programs, we are providing relief, like delaying the time and paying the employer’s share of the FICA taxes. You put that all together and there is much help out there to keep our economy going during this crisis, with particular focus on the workers and on small business.
“The last point I should point out, the self-employed, the gig economy are fully covered under the small business provisions. They are fully covered under the UI provisions. We are trying to make sure that we preserve our economy, that we preserve workers and their families and their abilities to pay their bills. I think when you take a look at this whole package, the challenge will be to get the information out to these businesses and to these workers, so they know what’s in this package and they can act now.
“Quite frankly, people are desperate. Companies are desperate. When malls are closed, as they are in Maryland, and you are operating a small business in that mall, you have no business at all. You don’t know how you are going to make your next payroll. You have to make decisions today. That is why it’s important we vote on this bill today and get it to the president as soon as possible. We need to get the information out to the small businesses, to the workers, and to all businesses. We are here to help keep them open, to keep the paychecks flowing, to keep our economy moving. We are in this together. We are going to get through this period. Our economy is going to come back, but we want you to know to take advantage of these tools so that we can minimize the adverse impact of the coronavirus.”