On Sunday, nearly a week after Congress passed the new stimulus bill, President Trump signed the $900 billion package into law. The new bill allows individuals on Pandemic Unemployment Assistance (PUA) or traditional unemployment insurance to receive benefits through March 13, 2021, and provides them with an additional $300 per week in federal unemployment assistance. California’s EDD has begun making program changes for the new law, but has said it cannot implement them until the federal Department of Labor provides guidelines to state. Payments due under the law will be retroactive to the week beginning December 27 for eligible claimants.
The bill will also provide a one-time direct payment of $600 to individuals earning up to $75,000 and heads of household earning up to $112,500, and $1,200 for couples making up to $150,000, as well as an extra $600 per eligible child dependent. The payment amount will be phased out for those with higher incomes. The Treasury Department will begin distributing the payments before the end of the year and estimates it can deliver between 5 and 7 million checks per week.
The relief bill also provides an additional $284 billion for Paycheck Protection Program (PPP) loans and allows certain eligible businesses to receive a “second-draw” loan of up to $2 million. To qualify for second-draw PPP loans, businesses, independent contractors and other self-employed persons must have 300 or fewer employees, have used or will use the full amount of their first PPP loan, and be able to demonstrate at least a 25 percent reduction in gross receipts in any quarter of 2020 compared to the same quarter in 2019.
Beginning today, the California Office of the Small Business Advocate is accepting applications for its Small Business COVID-19 Relief Grant program. The amount of grant funding ranges from $5,000 to $25,000. Any sole proprietor, independent contractor or business entity that has yearly gross revenue of less than $2.5 million can apply provided: They have been operating since at least June 1, 2019; they are currently operating or have a plan to reopen; they have been impacted by COVID-19 and the health and safety restrictions such as business interruptions or business closures incurred as a result of the COVID-19 pandemic. Eligible applicants will be scored based on various factors, and not everyone who applies and meets the criteria is guaranteed a grant.
California’s new unemployment claims fell 23 percent last week from the previous week. However, California’s unemployment remains significantly higher than the national average; despite California being home to roughly a tenth of the national labor pool, Californians comprised nearly a fifth of last week’s new unemployment claims. And California’s economic rebound over the summer was the seventh weakest in the nation.
Sources: CNN, CNBC, Forbes, Official State of California Government Website, The Mercury News, The Orange County Register, California Employment Development Department, California Association of Realtors®