On March 10, 2021, Congress passed HR1319 opens in a new window, a $1.9 trillion coronavirus relief package known as the “American Rescue Plan of 2021.” President Biden signed the bill into law on March 11th. The Plan expands federal assistance to renters, homeowners, small business owners, the unemployed, and others. Included in the Plan are several provisions that are expected to impact the real estate industry.
HR1319 provides $40 billion in rental and mortgage assistance, including $21.55 billion for emergency rental assistance, $5 billion for emergency housing vouchers, $750 million for tribal housing assistance, and $100 million for rural housing. The American Rescue Plan is the first coronavirus relief stimulus package to also address losses suffered by state, local and tribal governments due to Covid-19, with $350 billion allocated to pandemic-related budget deficits. An additional $10 billion is also set aside to assist local governments with infrastructure capital projects.
HR 1319 adds another $7.25 billion to the Paycheck Protection Program (PPP), a loan program intended to help businesses retain employees during the pandemic. The Plan also allocates an additional $28.6 billion to the Restaurant Revitalization Fund (to be administered by the Small Business Administration). Restaurants that are eligible to receive aid can apply for grants up to $10 million for multiple-restaurant groups and $5 million for individual eateries. Restaurant and small business owners are also eligible for long-term, low-interest rate loans through a $15 billion Emergency Injury Disaster Loan (EIDL) program.
The HR1319 legislation extends major unemployment insurance programs created by the Coronavirus Aid, Relief, and Economic Security (CARES) Act, such as the Pandemic Unemployment Assistance (PUA), Pandemic Emergency Unemployment Compensation (PEUC), and Federal Pandemic Unemployment Compensation (FPUC) programs, all of which were set to expire on March 14 but have now been extended through Sept. 6, 2021.
WHAT ABOUT LANDLORDS?
Among the business sectors most negatively affected by the Covid-19 pandemic are landlords, who are not allocated any direct coronavirus relief aid from HR1319. The Biden administration announced on March 29 an extension of the existing federal eviction moratorium to June 30, 2021, which places an additional financial burden on property owners who have not received rent payments from their tenants. However, federal rental assistance is expected to reach residential landlords via tenants paying their rent -- and restaurant grants and loans should benefit commercial landlords as well. Multi- and single-family residential landlords are also expected to benefit from the Plan’s extended unemployment benefits as well as the $1,400 stimulus payments which will likely be used to pay for household necessities, including rent.