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New COVID bill in Congress could be retailers’ ‘key to recovery’
New COVID bill in Congress could be retailers’‘key to recovery’
5 things retailers need from a COVID-19 recovery bill
When the coronavirus pandemic first hit the U.S. economy this spring, Congress and the White House quickly came together to provide assistance to the thousands of businesses and millions of workers affected. The scale and speed of the packages they created were truly historic.
Now, lawmakers are at work on another major piece of legislation that will help rebuild our nation’s robust economy and could be the key to recovery for retailers.
Tell Congress what retail needs
Join our grassroots campaign for COVID-19 relief here.
As Congress negotiates, NRF’s largest priority is the health and safety of retail workers and customers. We want businesses to remain open, jobs to come back and the economy to grow again, but the key to that happening is safety. That’s why we recently called on all retailers to require customers to wear face coverings or masks. And assisting businesses with the ongoing costs of making workplaces safe – from constant cleaning to testing employees – are the elements that must be included in the new bill.
It is vitally important to get it right on this new round of relief. The packages of the past few months provided an important bridge for some businesses that helped them get through the crisis. Many initiatives, notably the landmark Paycheck Protection Program, delivered timely relief to the smallest employers and helped avert a much deeper employment crisis. Others, such as the Main Street Lending Program, were too slow and poorly designed to deliver the urgently needed liquidity they were intended to provide to mid-size companies. As a result, some mid-size retailers have sought bankruptcy protection while others have found credit only under the harshest terms.
Many mid-size companies remain hamstrung from weeks of limited revenue, high costs of personal protective equipment and supplies, and limits on capacity in their stores. Simply adding more money to programs for small businesses would leave these employers without help.
That’s why NRF has asked Congress to ensure that the new stimulus bill provides help for all retailers. Here are our key requests:
Increase funding for loan and financial assistance programs that help retailers retain employees and remain solvent. The Paycheck Protection Program and Economic Injury Disaster Loan program for small businesses should be well-funded so retailers can continue to access them, and complex loan forgiveness paperwork should be simplified. NRF supports the Paycheck Protection Small Business Forgiveness Act, which would allow PPP loans under $150,000 to be forgiven upon completion of a one-page document.
Enact liability protection against unwarranted lawsuits. As an industry whose employees interact with the public every day, we support a targeted and limited safe harbor for companies that implement government-issued public health safety guidelines. Retailers have taken extraordinary measures to make their stores safe. But without liability protection, the threat of litigation will severely impact business operations, slow retailers’ recovery and negatively impact the economy overall.
Adopt tax relief to boost liquidity for retailers that have lost sales or face increased costs. The proposed Healthy Workplace Tax Credit would help cover the cost of measures taken to make stores safe such as personal protective equipment and employee testing. Congress should also allow businesses with 2020 operating losses to obtain an advance on refunds they would otherwise receive next year anyway, and should increase the size and flexibility of the Employee Retention Tax Credit. In addition, the tax treatment of charitable inventory donations should be improved – retailers currently get a larger tax break for destroying unsold merchandise than donating it.
Allow retailers to use loan and assistance programs to cover fixed costs. Much of the assistance has focused on employee payrolls, but retailers faced fixed costs such as rent and utilities while closed, and those costs continue amid reduced sales after reopening. Congress should allow funds provided by loan programs to be used for those costs and do the same with the Employee Retention Tax Credit.
Prioritize economic relief for individuals. The $600 in weekly federal unemployment benefits created under the CARES Act provided vital assistance. But when combined with state benefits, some individuals received more in unemployment than previously received in wages, creating a disincentive to return to work. Rather than extending the $600 benefit, NRF is urging a more targeted approach including return-to-work incentives, unemployment benefits that are proportional and account for state conditions, and expanded job training.
NRF’s largest priority is the health and safety of retail workers and customers.
Beyond those priorities, NRF supports the Small Business Comeback Act, which would create a recovery fund tailored for small businesses. In addition, the Pandemic Risk Insurance Act would encourage insurance companies to cover business interruption caused by a pandemic by providing a federal backstop.
What can retailers do? Sign up now for our “Five Ways Congress Can Support Retail” grassroots campaign to send messages to your members of Congress and make the voice of retail heard in the nation’s capital. Time is of the essence – this legislation will likely be passed by the time Congress begins its summer recess in early August. And retailers need help today.
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