501(c)6 Provision in Play for Next COVID Relief Bill

Advocacy News
August 3, 2020
By Mark Valentini, Director of Legislative Affairs

With the introduction of the HEALS Act on July 27, the Republicans have presented a $1.5 trillion counter-offer to House Democrats’ $3 trillion HEROES Act.

Several PHCC policy priorities are part of a final package. Those priorities include:

  • Extension of the Paycheck Protection Program (PPP) through December 2020;
  • Reversal of IRS guidance from April 30 prohibiting the deduction of any business expenses paid with PPP funds; and
  • Inclusion of 501(c)6 organizations for participation in the PPP.

The HEALS Act also proposes a liability shield to protect businesses from COVID-19 litigation through 2024 or when the pandemic is officially over, whichever comes last. This provision was not included in the HEROES Act and is opposed by House Democrats. Senate Republicans have drawn a red line on the liability protections and insist a bill cannot pass without it. The language would protect businesses that have applied federal, state, or local guidelines regarding the protection of employees through provision of personal protective equipment (PPE) and policies that mandate social distancing and other hygeine practices. Businesses deemed to have been negligent in protecting employees would not be protected. PHCC supports this provision.

The 501(c)6 provision will apply to organizations of 300 or less employees, whose federal lobbying expenses do not exceed 10% of revenue. Any payroll calculations for loan forgiveness must exclude salaries of employees that are federally-registered lobbyists. PHCC supports this provision and is advocating vigorously for its inclusion in a final package.

As of press time, Senate and House leadership have failed to agree on a final comprehensive COVID relief package, with White House staff acting as mediators to reconcile their differences, primarily over unemployment benefits that expire July 31, aid to state and local governments, and a liability shield for businesses, schools, and hospitals. In the meantime, the U.S. economy has contracted by 33% and unemployment claims continue to come in at an average of almost 1.5 million claims per week. Unless these differences can be resolved quickly, it is likely a continuing resolution will be passed before Congress adjourns for a month-long recess beginning August 7 that will extend key provisions until Congress reconvenes in September to finalize a comprehensive deal.

Director of Legislative Affairs
, PHCC-National Association
Mark Valentini is the Director of Legislative Affairs for PHCC—National Association. A seasoned professional with more than 20 years of experience on Capitol Hill and with several national trade associations, Valentini applies his expertise in public policy, workforce and training, and insurance and tax matters to advocate on behalf of all PHCC members.

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