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Following House passage earlier in the night, the Senate has also passed the Phase 4 coronavirus relief and fiscal year 2021 funding omnibus package. The president is expected to sign the measure.

The package includes several NAFCU-sought provisions related to member business lending and credit union flexibilities:

CARES Act credit union relief:

• extends NAFCU-sought flexibility to suspend the requirements for financial institutions to classify certain loan modifications as troubled debt restructurings (TDRs) to Jan. 1, 2022, or 60 days after the coronavirus national emergency is terminated (whichever is earliest);
• extends flexibility provided to the NCUA to enhance credit unions' use of the Central Liquidity Facility (CLF) through Dec. 31, 2021; and
• further extends the optional, temporary relief from the current expected credit loss (CECL) standard. While credit unions' mandatory effective date for CECL isn't until 2023, some credit unions have adopted the standard early and this provision provides optional relief.

Paycheck protection program (PPP):

• provides $284.5 billion to reopen and strengthen the PPP;
• creates a process for the hardest hit small businesses to receive a second PPP loan, capped at $2 million, if the business has less than 300 employees and can demonstrate a revenue reduction of 25 percent;
• sets aside $15 billion for small, community-based lenders, including credit unions with less than $10 million in assets;
• sets aside $35 billion for first-time borrowers, with $15 billion of that reserved for businesses with 10 or fewer employees or loans less than $250,000 in low-income areas;
• sets aside $25 billion for second-draw PPP borrowers that meet the criteria in the previous bullet;
• includes NAFCU-sought language to simplify the forgiveness process for loans under $150,000 and to provide protections for lenders;
• expands the eligible list of expenses; and
• repeals the CARES Act provision that required PPP borrowers to deduct from their forgivable amount economic injury disaster loan (EIDL) advances, which NAFCU had raised concerns about.

EIDL advance program:

• provides $20 billion to restart and extend the EIDL advance grant for small businesses in low-income communities; and
• creates a process for grantees that received less than the $10,000 maximum to reapply for the difference between their initial grant and the maximum amount.

Credit union programs:

• provides $3 billion in emergency funding for the Treasury's Community Development Financial Institutions (CDFI) Fund and $270 million for the fund's FY2021 appropriation; and
• appropriates $1.5 million to the NCUA's Community Development Revolving Loan Fund (CDRLF) for FY2021.

NAFCU sent congressional leaders a letter Monday ahead of the votes to offer support for these provisions and also highlight some areas that credit unions would like additional relief on in future efforts.

Stay tuned to NAFCU Today as the association's award-winning advocacy team develops resources for credit unions on these new provisions.