Section 1 Short title
This Act may be cited as the “Assistance for Businesses and Local Economies Act” or the “ABLE Act of 2020”.
Assistance for Businesses and Local Economies Act
A BILL
To establish the Emergency Social Insurance Program in the Social Security Administration and Small Business Administration in order to address the injury concerns of certain small businesses and idle workers disproportionally affected by the COVID-19 crisis.
Sec. 2 Establishment and coordination of the emergency social insurance program
In general— The Administrator of the Social Security Administration and the Administrator of the Small Business Administration, under the direction of the Secretary of Labor and the Secretary of the Treasury, respectively, in consultation with the Commissioner of the Internal Revenue Service, shall establish a joint program to efficiently coordinate and deliver direct payments to affected small businesses and affected idle workers during the COVID-19 crisis.
Establishment— The Emergency Social Insurance Program shall be a dual approach for direct government assistance to meet full salary need of lost wages faced by affected idle workers and to meet full maintenance need of output losses faced by affected small businesses in order to stabilize and shelter the economy from COVID-19.
Coordination— The Social Security Administration and the Department of Labor shall collaborate with States to increase and maximize unemployment insurance benefits for affected idle workers through existing State agency mechanisms. The Small Business Administration and the Department of the Treasury (with the Internal Revenue Service) shall be responsible for establishing and managing a $500 billion fund for direct economic injury grants for qualifying small businesses, with IRS assisting in verification and oversight of awards’ amounts and uses.
Definitions— In this Act:
SSA; SSA Administrator; SBA; SBA Administrator; IRS; IRS Commissioner— The terms “SSA” and “SSA Administrator” mean the Social Security Administration and the Administrator thereof, the terms “SBA” and “SBA Administrator” mean the Small Business Administration and the Administrator thereof, the terms “IRS” and “IRS Commissioner” mean the Internal Revenue Service and the Commissioner thereof, respectively.
COVID-19 crisis— The term “COVID-19 crisis” means the period that begins upon the date of the enactment of this Act and ends on the date of the termination by the Federal Emergency Management Agency of the emergency declared on March 13, 2020, by the President under the Robert T. Stafford Disaster Relief and Emergency Assistance Act (42 U.S.C. 4121 et seq.) relating to the Coronavirus Disease 2019 (COVID–19) pandemic.
Affected idle worker— The term “affected idle worker” means an individual who, as a result of COVID-19—
has no rights to regular compensation with respect to a week under State law or any other State unemployment compensation law or to compensation under any other Federal law;
is not receiving any State or private paid leave with respect to such week; and
can attest that—
the individual is not able or available to work due to COVID-19 with respect to such week;
the individual would be able and available to work during such week, if not for COVID-19; because
the individual has a current diagnosis of COVID-19;
the individual is under quarantine (including self-imposed quarantine), at the instruction of a health care provider, employer, or a local, State, or Federal official, in order to prevent the spread of COVID-19;
the individual is unable to engage in self-employment and had past net earnings from self-employment (as defined in section 1402(a) of the Internal Revenue Code of 1986) of not less than $2500 during the 6-month period ending on the date of enactment of this Act;
the individual had a contract or other offer of employment suspended or rescinded due to COVID-19;
the individual is engaged in caregiving (without compensation) for an individual who has a current diagnosis of COVID-19 or is under quarantine; or
the individual is engaged in caregiving (without compensation), because of the COVID-19-related closing of a school or other care facility or care program, for a child or other individual unable to provide self-care.
Affected small business— The term “affected small business” means—
a small business concern (as defined under section 3 of the Small Business Act (15 U.S.C. 636));
a family farm;
an independent contractor; and
any other affected additional covered entity, under section 5 of this Act, to which the Small Business Administration determines grants would promote full employment and financial stability during the COVID-19 crisis.
Affected small business concern— The term “affected small business concern” means a small business concern that has experienced, as a result of COVID-19—
supply chain disruptions, including changes in—
quantity and lead time, including the number of shipments and components and delays in shipments;
quality, including shortages in supply for quality control reasons; and
technology, including a compromised payment network;
staffing challenges;
a decrease in profits, sales, or customers; or
a closure.
Sec. 3 Enhancement of emergency COVID-19 unemployment compensation for affected idle workers
In general— The Administrator of the Social Security Administration (referred to as the “SSA Administrator” in this section), in consultation with the Secretary of Labor, shall assist States to offer expanded unemployment insurance for workers reporting as idle or unemployed, as a result of the public health emergency declared because of COVID-19.
Idle defined— The term “idle” means a worker facing substantial economic uncertainty and hardship due the COVID-19 and its social distancing, including but not limited to—
food service industry workers and hospitality workers;
domestic workers and tipped workers;
gig economy workers, freelancers, and other self-employed individuals; and
independent contractors.
Federal-State agreements— Any State which desires to do so may enter into and participate in an agreement under this section with the Secretary of Labor (hereinafter this section referred to as the “Secretary”). Any State which is a party to an agreement under this section may, upon providing 30 days’ written notice to the Secretary, terminate such agreement.
Provisions of agreement—
In general— Any agreement under this section shall provide the following:
Emergency covid-19 unemployment compensation— The State agency of the State will make payments of regular compensation to individuals in amounts and to the extent that they would be determined if that State law of the State were applied, with respect to any week for which the individual is (disregarding this section) otherwise entitled under the State law to receive regular compensation, as if such State law had been modified in a manner such that the amount of regular compensation (including dependents’ allowances) payable for any week shall be equal to meet 100 percent salary—
the amount determined under the State law (before the application of this paragraph), plus additional amount caps (referred to as “Emergency COVID-19 Unemployment Compensation” in this section), including—
up to an additional $5,000 per month for all affected idle workers of such affected small businesses (described in section 3 of this Act);
up to an additional $4,000 per month for all affected idle tipped workers, certain domestic workers, and independent contractors; and
up to an additional $3,000 per month for all other affected and eligible self-employed individuals, such as gig economy workers and freelancers.
Emergency covid-19 short-time compensation— In the case of a State that provides under the State law for the payment of short-time compensation under a short-time compensation program (as defined in section 3306(v) of the Internal Revenue Code of 1986), the State agency of the State will make payments of compensation to employees participating in such program in amounts and to the extent that they would be determined under such program if the State law of the State were applied with respect to any week for which the individual is (disregarding this section) otherwise eligible under the program under the State law to receive such compensation, as if such State law had been modified in a manner such that the amount of compensation payable for any week shall be equal to the amount determined under the State law (before the application of this paragraph) plus half the eligible amount of the caps in subparagraph (A) in this section (d).
Allowable methods of payment— Any Emergency COVID-19 Unemployment Compensation or Emergency COVID-19 Short-Time Compensation provided for in the accordance with paragraph (1) shall be payable either—
as an amount which is paid at the same time and in the same manner as any compensation otherwise payable for the week involved; or
at the option of the State, by payments which are made separately from, but on the same weekly basis as, any compensation otherwise payable.
Nonreduction rule— Any agreement under this section shall not apply (or shall cease to apply) with respect to a State upon a determination by the Secretary that the method governing computation of regular compensation under the State law of that State has been modified in a manner such that the maximum benefit entitlement and the average weekly benefit amount of regular compensation (or short-time compensation in the case of a State described in subsection (d)(1)(B) which will be payable during the period of the agreement (determined disregarding any Emergency COVID-19 Unemployment Compensation or Emergency COVID-19 Short-time Compensation) will be less than the maximum benefit entitlement and the average weekly benefit amount of regular compensation (or short-time compensation) which would otherwise have been payable during such period under the State law, as in effect on January 1, 2020.
Payments to States—
In general—
Full reimbursement— There shall be paid to each State which has entered into an agreement under this section an amount equal to 100 percent of—
the total amount of Emergency COVID-19 Unemployment Compensation paid to individuals by the State pursuant to such agreement;
the total amount of Emergency COVID-19 Short-Time Compensation paid to individuals. By the State pursuant to such agreement; and
any additional administrative expenses incurred by the State by reason of such agreement (as determined by the Secretary).
Terms of payments— Sums payable to any State by reason of such State’s having an agreement under this section shall be payable, either in advance or by way of reimbursement (as determined by the Secretary), in such amounts as the Secretary Estimates that State will be entitled to receive under this section for each calendar month, reduced or increased, as the case may be, by any amount by which the Secretary finds that his estimates for any prior calendar month were greater or less than the amount which should have been paid to the State. Such estimates may be made on the basis of such statistical, sampling, or other method as may be agreed upon by the Secretary and the State agency of the State involved.
Certifications— The Secretary shall from time to time certify to the Secretary of the Treasury for payment to each State the sums payable to such State under this section.
Appropriation— There are appropriated from the general fund of the Treasury, without fiscal year limitation, such sums as may be necessary for purposes of this subsection.
Applicability—
In general— An agreement entered into under this section shall apply to weeks of unemployment—
beginning on or after March 1, 2020; and
ending on or before January 1, 2021.
Duration of benefit payments— An individual who becomes entitled to such agreement will receive payments from a State or Agency for not more than 25 weeks.
Transition rule for individuals remaining entitled to regular compensation as of april 30, 2021— In the case of any individual who, as of the date specified in paragraph (1)(B), has not yet exhausted all rights to regular compensation under the State law of a State with respect to a benefit year that began before such date (or short-time compensation in the case of State described in subsection (d)(1)(B) Emergency COVID-19 Unemployment Compensation or Emergency COVID-19 Short-Time Compensation provided for in the accordance with paragraph (1) shall be payable to such individual for any week beginning on or after such date for which the individual is otherwise eligible for regular compensation (or short-time compensation) with respect to such benefit year.
Termination— Notwithstanding any other provision of this subsection, no Emergency COVID-19 Unemployment Compensation or Emergency COVID-19 Short-Time Compensation shall be payable for any week beginning after April 30, 2021, but Congress has the option to end this program earlier or extend it as well.
Fraud and overpayments—
In general— If an individual knowingly has made, or caused to be made by another, a false statement or representation of a material fact, or knowingly has failed, or caused another to fail, to disclose a material fact, and as a result of such false statement or representation of such nondisclosure such individual has received an amount of Emergency COVID-19 Unemployment Compensation or Emergency COVID-19 Short-Time Compensation to which such individual was not entitled, such individual—
shall be ineligible for further Emergency COVID-19 Unemployment Compensation or Emergency COVID-19 Short-Time Compensation in accordance with provisions of the applicable State unemployment compensation law relating to fraud in connection with a claim for unemployment compensation; and
shall be subject to prosecution under section 1001 of title 18, United States Code.
Repayment— In the case of individuals who have received amounts of Emergency COVID-19 Unemployment Compensation or Emergency COVID-19 Short-Time Compensation to which they were not entitled, the State shall require such individuals to repay the amounts of such Emergency COVID-19 Unemployment Compensation or Emergency COVID-19 Short-Time Compensation to the State agency, expect that the State agency may waive such repayment if it determines that—
the payment of such Emergency COVID-19 Unemployment Compensation or Emergency COVID-19 Short-Time Compensation was without fault on the part of any such individual; and
such repayment would be contrary to equity and good conscience.
Recovery by state agency—
In general— The State agency may recover the amount to be repaid, or any part thereof, by deductions from any Emergency COVID-19 Unemployment Compensation or Emergency COVID-19 Short-Time Compensation payable to such individual or from any unemployment payable to such individual under any State or Federal unemployment compensation law administered by the State agency or under any other State or Federal law administered by the State agency which provides for the payment of any assistance or allowance with respect to any week of unemployment, during the 3-year period after the date such individuals received the payment of the Emergency COVID-19 Unemployment Compensation or Emergency COVID-19 Short-Time Compensation to which they were not entitled, in accordance with the same procedures as apply to the recovery of overpayments of regular unemployment benefits paid by the State.
Opportunity for hearing— No repayment shall be required, and no deduction shall be made, until a determination has been made, notice thereof and an opportunity for a fair hearing has been given to the individual, and the determination has become final.
Review— Any determination by a State agency under this section shall be subject to review in the same manner and to the same extent as determinations under the State unemployment compensation law, and only in that manner and to that extent.
Application to other unemployment benefits—
In general— Each agreement under this section shall include provisions to provide that the purposes of the preceding provisions of this section shall be applied with respect to unemployment benefits described in section (i)(3) to the same extent and in the same manner as if those benefits were regular compensation.
Eligibility and termination rules— Emergency COVID-19 Unemployment Compensation—
shall not be payable, pursuant to this subsection, with respect to any unemployment benefits described in subsection (i)(3) for any week beginning on or after the date specified in subsection (g)(1)(B), except in the case of an individual who was eligible to receive Emergency COVID-19 Unemployment Compensation in connection with any regular compensation or any other unemployment benefits described in subsection (i)(3) for any period of unemployment ending before such date; and
shall in no event be payable for any week beginning after date specified in subsection (g)(3).
Treatment of emergency COVID-19 unemployment compensation and emergency COVID-19 short-Time compensation payments— An Emergency COVID-19 Unemployment Compensation and Emergency COVID-19 Short-Time Compensation payment shall not be regarded as income and shall not be regarded as a resource for the money of receipt and the following 9 months, for purposes of determining the eligibility of the recipient (or the recipient’s spouse or family) for benefits or assistance, or the amount or extent of benefits or assistance, under any Federal program or under any State or local program financed in whole or in part with Federal funds.
Definitions— For purposes of this section—
the terms “compensation”, “regular compensation”, “benefit year”, “State”, “State agency”, “State law”, and “week” have the respective meanings given such terms under section 205 of the Federal-State Extended Unemployment Compensation Act of 1970 (26 U.S.C. 3304);
the term “maximum benefit entitlement” means the amount of regular compensation payable to an individual with respect to the individual’s benefit year; and
any reference to unemployment benefits described in this paragraph shall be considered to refer to—
extended compensation (as defined by section 205 of the Federal-State Extended Unemployment Compensation Act of 1970); and
unemployment compensation (as defined by section 85(b) of the Internal Revenue Code of 1986) provided under any program administered by a State under an agreement with the Secretary.
Sec. 4 Emergency direct compensation for affected additional covered entities
In general— The Administrator of the Small Business Administration in consultation with the Secretary of the Treasury and the Commissioner of the Internal Revenue Service, shall provide grants to additional covered entities that have suffered a substantial economic injury (as defined in section 7(b)(2) of the Small Business Act (15 U.S.C. 636(b)(2))), directly or indirectly, as a result of the public health emergency declared because of COVID-19.
Additional covered entity defined— The term “additional covered entity” means—
a business concern that employs not more than 500 employees per physical location of the business concern and that is assigned a North American Industry Classification System code beginning with 71; 72; 44; 45;
a small business concern (as defined under section 3 of the Small Business Act (15 U.S.C. 632)); and
if such person was in operation on or before January 31, 2020—
an individual who operates under a sole proprietorship or as an independent contractor;
a cooperative that employs not more than 500 employees per physical location of the cooperative;
an ESOP (as defined in section 3(q)(6) of the Small Business Act (15 U.S.C. 632(q)(6))) that employs not more than 500 employees per physical location of the ESOP;
an organization serving veterans or members of the Armed Forces (as defined in section 501(c)(19) of the Internal Revenue Code of 1986, that is exempt from taxation under subsection (a) of such sections);
a private nonprofit organization that employs not more than 500 employees per physical location of the organization; or
a start-up small business concern that employs not more than 500 employees per physical location of the concern.
Priority— The SBA Administrator shall consider prioritizing certain small businesses in initial rounds of grantmaking such as—
a small business concern that employs not more than 100 employees per physical location;
a minority-owned small business concern, a woman-owned small business concern, or a veteran-owned small business concern;
a small business concern where the owner’s pay is equal to or less than 25 times the average worker pay; or
a small business concern that has not fired or laid off its employees yet, reduced the salaries or wages of its employees, or changed any labor contracts, such as collective bargaining rights, for its employees in the interim, unless exceptions provided within subsection (o)(5) are met.
Self-Reporting in application— The SBA Administrator, in coordination with the IRS Commissioner, shall consider the necessary maintenance costs, as established in subsection (l), self-reported by qualifying additional covered entities, to determine the sufficient amount of grants. An eligible recipient seeking such a grant under this section shall submit documentation to the SBA and IRS that include—
documentation verifying the number of full-time equivalent employees on payroll and pay rates for the periods described in subsection (d), including—
payroll tax filings reported to the Internal Revenue Service; and
State income, payroll, and unemployment insurance filings;
documentation, including cancelled checks, payment receipts, transcripts of accounts, or other documents verifying payments on covered mortgage obligations, payments on covered lease obligations, and covered utility payments;
a certification from a representative of the eligible recipient authorized to make such certifications that—
the documentation presented is true and correct; and
the amount for which the grant is requested was used to retain employees, make interest payments on a covered mortgage obligation, make payments on a covered rent obligation, or make covered utility payments; and
any other documentation the SBA Administrator determines necessary.
Additional processes— The SBA Administrator shall also be able to use the existing direct loan application process administered under section 7(b) of the Small Business Act (15 U.S.C. 636(b)) to disburse grant funds, to the greatest extent possible, within 7 days after receiving an application from an additional covered entity.
Verification of eligibility— Before disbursing amounts under this subsection, the SBA Administrator shall verify that the applicant is an additional covered entity.
Verification of amount— After disbursing amounts under this subsection, the SBA Administrator, in consultation with the IRS commissioner, shall verify that the requested amount for grants from an additional covered entity did not exceed necessary maintenance costs, not later than 1 year after the end date or termination of this Act.
Overpayment— Excess compensation in the form of any overpayment of grants, as examined and determined by the IRS and SBA in post-award reviews, shall be automatically considered as zero-interest loans to be paid and returned to the United States Government.
Exemption from affiliation rules— For purposes of this section, the SBA Administrator shall suspend the application of the affiliation rules of the Small Business Administration during the period beginning on January 31, 2020, and ending on September 30, 2021, expect that individual affiliates may not exceed the current small business size standard for the industry in which the affiliate operates, and any group of affiliates may not receive more than 3 times the maximum allowable grant amount under subsection (j).
Amount of grants— The amount of a grant provided under this section shall not be more than $100,000. The SBA Administrator shall have the discretion to increase this cap for certain qualifying additional covered entities to ensure meeting 100 percent necessary maintenance costs.
Automatic multiple payments— Additional covered entities that receive their first grant will automatically be considered for and delivered another grant at the same level for at least the next four months, unless self-opted out or determined by the SBA Administrator.
Use of funds only for necessary maintenance costs— An additional covered entity that receives grants under this section may use the grant funds for necessary maintenance costs to address the direct effects of the COVID-19 pandemic, including—
payroll support, including paid sick, medical, or family leave and costs related to the continuation of health care benefits;
maintaining payroll to retain employees during business disruptions or substantial slowdowns;
meeting increased costs to obtain materials unavailable from the original source of the additional covered entity due to interrupted supply chains;
making payments under a lease or mortgage loan, or a contract for utility services, related to a place of operation of the additional covered entity;
repaying obligations that cannot be met due to revenue losses; and
other expenses, as deemed appropriate by the Administrator.
Eligibility for additional assistance— An additional covered entity that receives grants under this section may also apply for a zero-interest loan under subsection (a) or (b) of section 6 of the Small Business Act (15 U.S.C. 636).
Taxability— Grant amounts, canceled indebtedness, and other awards under this section shall be excluded from gross income for purposes of the Internal Revenue Code of 1986.
Limits on amount of grants—
Reduction based on reduction in number of employees—
In general— The amount of grants under this section shall be substantially reduced, but not increased, by multiplying the amount described in subsection (j) by the quotient obtained by dividing—
the average number of full-time equivalent employees per month employed by the eligible recipient during the covered period; by
the average number of full-time equivalent employees per month employed by the eligible recipient during the period beginning on February 15, 2019, and ending on June 30, 2019;
if the eligible recipient was not in operation before June 30, 2019, the average number of full-time equivalent employees per month employed by the eligible recipient during the period beginning on January 1, 2020, and ending on February 29, 2020; or
in the case of an eligible recipient that is a seasonal employer, as determined by the SBA Administrator, the average number of full-time equivalent employees per month employed by the eligible recipient during the beginning on February 15, 2019, and ending on June 30, 2019.
Calculation of average number of employees— For purposes of subparagraph (A), the average number of full-time equivalent employees shall be determined by calculating the average number of full-time equivalent employees for each pay period falling with a month.
Reduction relating to salary and wages—
In general— The amount of grants under this section shall be reduced by the amount of any reduction in total salary or wages of any employee described in subparagraph (B) during the covered period that is in excess of 25 percent of the total salary or wages of the employee during the most recent full quarter during which the employee was employed before the covered period.
Employees described— An employee described in this subparagraph is any employee who did not receive, during any single pay period during 2019, wages or salary at an annualized rate of pay in an amount more than $100,000.
Exception for tipped workers— An eligible recipient with tipped employees described in section 3(m)(2)(A) of the Fair Labor Standards Act of 1938 (29 U.S.C. 203(m)(2)(A)) may receive forgiveness for additional wages paid to those employees.
Ineligibility and exclusion from future consideration of funds— The SBA Administrator shall consider immediately stopping and excluding any future grants for additional covered entities that fire their employees during the payment period.
Exception for re-hires—
In general— In a circumstance described in paragraph (4), the amount of grants under this section shall be determined without regard to a reduction in the number of full-time equivalent employees of an eligible recipient or a reduction in the salary of 1 or more employees of the eligible recipient, as applicable, during the period beginning on February 15, 2020, and ending on April 1, 2020.
Circumstances— A circumstance described in this subparagraph is a circumstance—
in which—
during the period beginning on February 15, 2020, and ending on April 1, 2020, there is a reduction, as compared to February 15, 2020, in the number of full-time equivalent employees of an eligible recipient; and
not later than June 30, 2020, the eligible employer has eliminated the reduction in the number of full-time equivalent employees;
in which—
during the period beginning on February 15, 2020, and ending in April 1, 2020, there is a reduction, as compared to February 15, 2020, in the salary or wages of 1 or more employees of the eligible recipient; and
not later than June 30, 2020, the eligible employer has eliminated the reduction in the salary or wages of such employees; or
in which the events described in clauses (i) and (ii) occur.
Procedures— The SBA Administrator shall establish procedures, in coordination with the SSA Administrator and IRS Commissioner, to verify and document the compliance of an additional covered entity that receives grants under this section with the requirements under this section in order to prevent waste, fraud, and abuse of such grant funds.
Regulations— Not later than 30 days after the date of enactment of this Act, the SBA Administrator, in consultation with the IRS Commissioner, shall issue guidance and regulations implementing this section.
Report— Not later than March 31, 2022, the SBA Administrator shall submit to Congress a report that includes—
the number of grants made under this section, disaggregated by the number of grants made per 10,000 amount;
the average amount of a grant award;
an analysis of the program established under this section and recommendations for improvement;
the average time from receipt of an application to approval of grant under this section; and
the average time from approval of grant to disbursement of grant funds.
Authorizations of appropriations— There is authorization to be appropriated $500,000,000,000 of the SBA Administrator to carry out this section. Congress shall consider increasing funds at the request of the SBA Administrator.
Termination— The authority to carry out grants under this subsection shall terminate on April 30, 2021.