President Biden signed a new $1.9 trillion stimulus package titled The American Rescue Plan Act on March 11. The bill provides $1,400 direct payments to individuals making up to $75,000 annually, $350 billion in aid to state and local governments and $14 billion for vaccine distribution, among other things.
Of particular note to ag aviators, the new law includes $14 billion for the Payroll Support Program (PSP) to air carriers, including commercial general aviation operators. It also provides $8 billion in support to airports, $100 million of which is specified for non-primary airports. The law also provides $15 billion for additional Economic Injury Disaster Loan (EIDL) funding for small businesses and provisions to allow some aviation employers to receive up to 50% of the cost of base compensation and benefits for the 25% of its employees most susceptible to a furlough or layoff, not including senior executives.
In addition, the new law provides an additional $7.25 billion for the Paycheck Protection Program (PPP). It also expands PPP eligibility to include some not-for-profit associations. This stimulus package did not extend the PPP’s current application period, which is scheduled to close March 31. The Small Business Administration (SBA) is offering first draw and second draw PPP loans until March 31. The loan may be used for payroll costs, including benefits, and to pay interest on mortgages, rent and utilities. Loans will be fully forgiven if employees are kept on the payroll.
If you need more information about the PPP loan process, you should contact your SBA lender. If you are unsure of who your SBA lender is, check the SBA website. More information from the SBA may be found here. Although the application period was not extended in the latest stimulus package, the new law made it possible for more not-for-profits to be eligible for the PPP by creating a new category called “additional covered nonprofit entity.” Under this new category, those not-for-profits listed in Sec. 501(c) of the Internal Revenue Code other than 501(c)(3), 501(c)(4), 501(c)(6) or 501(c)(19) organizations can now qualify for PPP under certain conditions:
Additionally, 501(c)(3) organizations and veterans’ organizations are eligible if they employ no more than 500 employees per physical location. Larger 501(c)(6) organizations, domestic marketing organizations and other covered not-for-profit entities that employ not more than 300 employees per physical location are also eligible.
The organization must not receive more than 15% of receipts from lobbying activities.
- The lobbying activities must not comprise more than 15% of total organization activities.
- The organization’s cost of lobbying activities must not exceed $1 million during the most recent tax year that ended prior to Feb. 15, 2020.
- Finally, the organization must not employ more than 300 employees.
NAAA will continue to provide updates, as needed, on the status of these programs and their availability to the agricultural aviation industry.