Yesterday, Congress passed a long-overdue stimulus package. The $900 billion package will provide billions in rental assistance, extend the eviction moratorium and supplement state unemployment programs with continued Pandemic Unemployment Assistance. It also allows for a second round of forgivable small business loans under the Paycheck Protection Program and supports additional lending to low-income communities and communities of color.
Jesse Van Tol, CEO of the National Community Reinvestment Coalition, made the following statement on the economic support provisions of the package:
“This package represents a down payment for a just recovery that will prevent evictions, protect small businesses and provide additional direct payments to millions of families facing continued financial distress as a result of this global pandemic and economic crisis. The package also provides additional funding for Community Development Financial Institutions (CDFIs) and Minority Depository Institutions (MDIs), lenders who can put capital to work in low-income communities and communities of color when and where they need it most.
“Unfortunately, the package did not provide much-needed aid to state and local governments whose revenues have been sharply reduced by the ongoing crisis and failed to extend the student loan payment suspension. While the stimulus and budget package provided an increase in housing counseling funds for 2021, the final deal did not include one-time supplemental counseling funds included in prior proposals and necessary to help prevent delinquencies, defaults, foreclosures and evictions in the coming months.
“While this package contains some of the short-term relief that American families and businesses have been waiting for, much more is needed to put us on track for a just recovery. We look to the incoming Congress and administration of President-Elect Biden to move forward with a comprehensive recovery effort. A just recovery must include proactive efforts to bring credit and capital to communities that have long been ignored by modernizing the Community Reinvestment Act. We need a national homeownership strategy that sets ambitious goals to raise the Black and Latino homeownership rates. And we need to reverse the deregulatory agenda of the Trump Administration that gives too many financial institutions a free pass to avoid investing in communities and the ability to push abusive financial products with little oversight.”
Key provisions of the stimulus package:
- $25 billion in rental assistance for low- and moderate-income (LMI) renters, those who are at risk of experiencing homelessness or housing instability or who have lost their jobs as a result of the pandemic. Priority will be given to very low-income renters and those who have faced unemployment for more than 90 days.
- Extends the Center for Disease Control eviction moratorium until January 31, 2021. The current moratorium, designed to reduce infection rates and keep people in their homes during the worst months of the pandemic was set to expire at the end of the year. While the one month extension ensures that the moratorium does not lapse, it means that another extension will likely be needed to prevent an eviction crisis this winter.
- Provides additional support to community development lenders. Support will include $3 billion to the CDFI Fund to support grants and other financial institutions to CDFIs responding to the pandemic, and $9 billion in low-cost, long-term capital investments to CDFIs and MDIs to maintain or expand lending in LMI communities of color.
- Second-round Paycheck Protection Program funding for small businesses impacted by the pandemic. The package provides additional payroll support for small businesses with 300 employees or less and a 25% reduction in revenue from the prior year.
- Extend federal Pandemic Unemployment Assistance through April 2021, giving Americans facing continued joblessness an additional $300 per week.
- Provide a second round of $600 stimulus checks for adults and children.
- $57.5 million in housing counseling assistance, a $4.5 million increase over 2020, but far short of the supplemental $100 million included in the House-passed stimulus from earlier this year.