UPDATED: CARES Act: House and Senate Comparison for Small Businesses

03/27/2020 12:16 PM | ACRAsphere Blog Team

UPDATE: The bill has now been passed by the House and signed by President Trump. The programs detailed below and in this post will now be available to small businesses.

The House of Representatives is working to pass the Coronavirus Aid, Relief, and Economic Security Act, or the CARES Act, which previously

passed the Senate on Wednesday. The bill is expected to be signed by President Trump quickly once passed by the House.

The House Committee on Small Business has provided a helpful guide to assist small business owners and employees alike understand the provisions of the bill, including how the House version differs from the Senate. The overview of the guide:

American small businesses are facing an unprecedented economic disruption due to the novel coronavirus (COVID-19) outbreak, with reports of small businesses experiencing major difficulties. Due to the nature of this economic disruption, the existing disaster recovery programs for small businesses are insufficient. The CARES Act represents more than $376 billion in relief for struggling small businesses, which falls into two main buckets: Access to Capital and Small Business Support.

Access to Capital

  • $349 billion for forgivable loans to small businesses to pay employees and keep them on the payroll.
    • These loans are open to most businesses under 500 employees, non-profits, the selfemployed, startups, and cooperatives.
  • $17 billion for debt relief for current and new SBA borrowers. SBA will pay the principal and interest for the next 6-months on SBA-backed loans.
    • Today, that would help 320,000 small businesses and any new borrowers in the 7(a) or 504 programs.
  • $10 billion in immediate disaster grants. Using the current economic injury disaster loan program, SBA can provide up to $10,000 to applicants within 3 days of applicants selfcertifying they are eligible.

Small Business Support

  • Requires SBA to provide additional language resources to ensure small business owners can access the resources they need as easily as possible.
  • $265 million in funding for resource partners, including Small Business Development Centers and Women’s Business Centers to provide training and counseling to businesses impacted by Coronavirus.
  • A waiver of the WBC matching requirement to alleviate the need to fundraise during the emergency.
  • $10 million for Minority Business Development Agency grants to train and counsel minority-owned firms impacted by Coronavirus.
  • $675 million to provide SBA with the resources it needs to staff up and administer these new and enhanced programs.
  • Finally, this will increase the number of small businesses that qualify for streamlined bankruptcy process, by nearly tripling the debt cap to $7.5 million to help American small businesses that will need to reorganized due to the COVID-19 pandemic.

The guide goes on to break down the specific provisions of the bill applicable to small businesses:

  • Paycheck Protection Program - Section 1102
  • Entrepreneurial Development - Section 1103 
  • State Trade Expansion Program (STEP) Support – Section 1104
  • Women’s Business Center Matching Waiver – Section 1105
  • Loan Forgiveness – Section 1106
  • Direct Appropriations – Section 1107
  • Minority Business Development Agency – Section 1108
  • Emergency Economic Injury Grants – Section 1110

  • Increasing Access to SBA Through Multiple Language Support – Section 1111

  • 6-months of Principal and Interest Relief - Section 1112

  • Small Business Bankruptcy Enhancement – Section 1113

Each section outlined above includes a clarification on how the House and Senate versions of the bill differ in regards to small business provisions. Because members of both chambers worked closely together to craft this legislation, differences between the two versions are small. The primary difference identified by Chairwoman Nydia Velasquez (D-NY) concerns the Emergency Economic Injury Grants:

We worked closely with our Senate counterpart to ensure their package included this grant program, which was funded at $10 billion. It will provide up to 1 million small businesses with emergency relief. While not as high as the House package, now that the program is in place, we can push for additional resources in the future.

We have included the basics of the programs both above and in the post on the Senate passage of the bill, and please review the House Committee on Small Business guide for specifics on the differences between the two versions of the bill. The Committee Republicans have also put together a helpful summary and FAQ of the CARES Act which can be found here.

We will continue to provide updates to the ACRAsphere and social media as the legislation progresses.



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