WASHINGTON–The huge $2-trillion coronavirus relief and economic stimulus package has passed the Senate on a 96-0 vote, with credit unions generally expressing support, although NAFCU said some provisions in the legislation will "prove difficult for some credit unions to implement." The House is expected to vote on the legislation on Friday, with House Speaker Nancy Pelosi saying she is already focused on follow-up legislation.
At least three Republican senators had earlier indicated they were not yet prepared to vote in favor of the bill, primarily raising objections around unemployment benefits, before agreeing to vote in favor
In the Democratically controlled House, meanwhile, which some had expected might be a hurdle in getting the Coronavirus Aid, Relief and Economic Security Act (CARES Act, S.3548) passed, Pelosi has expressed support and urged other Democrats to “see the good” in the bill.
"It was a trickle-down, corporate bill. It is now a bubble-up, workers bill and we're very proud of that. (We) stand ready because the urgency is very clear," Pelosi told reporters.
The Senate bill includes $250 billion for direct payments to individuals, $350 billion in small business loans, $250 billion in unemployment insurance benefits, and $500 billion in loans for distressed companies. There is also $130-billion for hospitals and $150 billion for state and local governments that have been hit hard by the coronavirus.
NAFCU Response
“NAFCU has been hard at work on Capitol Hill amid the COVID-19 pandemic advocating on behalf of credit unions and their members, and we appreciate the Administration and Congress taking action in response to our advocacy efforts,” said NAFCU President and CEO Dan Berger. “Today's Senate passage of the CARES Act includes many victories for credit unions that will provide needed flexibility and relief as the industry proactively works to help our local communities recover economically.
“However, there is no doubt that other provisions in this legislation will prove difficult for some credit unions to implement, but credit unions will continue to do what they do best: serve their members," Berger continued. "NAFCU is proud to stand alongside credit unions as they help their 120 million members get through this uncertain time. To this end, NAFCU will continue to advocate for important relief measures that will help credit unions overcome the impact of COVID-19.”
CUNA Expresses Support
“The credit union priorities addressed in this bill are a direct result of tireless advocacy over the last few days and weeks on behalf of CUNA and the Leagues, and we look forward to continued engagement demonstrating how credit unions continue to be there for their members and communities,” said CUNA President/CEO Jim Nussle in a statement. “The concerns addressed in this bill will help enhance consumer access to safe and affordable financial services through a local credit union.”
CUNA said the provisions of importance to credit unions in the bill include:
- Making credit unions eligible to participate in the paycheck protection program, which would allow for 100% federally guaranteed loans to small businesses that maintain their payroll
- Reestablishing the Transaction Account Guarantee Program, in which the government guarantees certain noninterest-bearing transaction accounts
- Including credit unions in troubled debt restructuring, allowing credit unions to further modify existing loans
- Expanding NCUA’s Central Liquidity Facility, which serves as a liquidity lender to credit unions experiencing unusual or unexpected liquidity shortfalls
- Including credit unions in a current expected credit loss (CECL) delay for those entities currently required to comply with CECL
Also on Capitol Hill
Meanwhile, in other activities on Capitol Hill, CUNA said:
- It and other financial trade organizations called on the Treasury’s Financial Crimes Enforcement Network (FinCEN) for a 90-day extension on all Bank Secrecy Act (BSA) reporting requirements so that credit unions and other financial institutions can follow public health guidelines by working remotely
- Other organizations joined with CUNA to request clear and consistent guidance from the Small Business Administration (SBA) on how it intends to operate the expanded 7(a) loan program due to the pandemic.
- Additional comments were filed with NCUA regarding the proposed rule on bank-credit union combination transactions. Certain aspects of the ruling are not statutorily required, which CUNA raised as potentially problematic. CUNA Deputy Chief Advocacy Officer & Senior Counsel Elizabeth Eurgubian stated in the letter that codifying and centralizing the existing requirements will aid credit unions pursuing such transactions.