Cooperative businesses should be eligible for any federal assistance in response to COVID-19

NCBA CLUSA is actively working with Congress to provide fair access to federal disaster assistance to all cooperative businesses.

NCBA CLUSA president and CEO Doug O’Brien sent letters to Congressional and federal agency leaders today to ensure that cooperative businesses are included as eligible entities in any federal assistance in response to the global outbreak of coronavirus, or COVID-19.

Last week, in near unanimous fashion, Congress passed and President Trump signed into law an emergency supplemental of funds to support a response to the potential spread of COVID-19 (P.L.116-123). The legislation provides additional funding to a number of federal agencies including the Department of State, Department of Health and Human Services, National Institutes of Health, and Centers for Disease Control and Prevention.

Importantly, this legislation also makes available an additional $7 billion in lending ability to the U.S. Small Business Administration. In response to disasters, the SBA is able to provide low-cost loans to affected businesses to address workforce reductions, supply chain management and other forms of “economic injury.”

Unfortunately, SBA does not recognize consumer or marketing cooperatives as eligible entities under the Administration’s Standard Operating Procedure. NCBA CLUSA is actively working with SBA and Congress on this issue to provide fair access to federal disaster assistance to all cooperative businesses.

“Despite competing in the market like all other types of businesses, cooperatives remain ineligible for many federal programs,” O’Brien said in the letter. “While I look forward to more in-depth discussions about the eligibility of cooperatives, at present, it is critical that you ensure cooperatives are explicitly listed as eligible entities for the federal assistance made available by Congress, including issues related to tax relief, small business loans and others.”

Congress and the Administration have indicated that while this emergency supplemental appropriations was an important step, it is likely not the only measure that will be taken at a federal level to help individuals, communities and businesses respond to the consequences of a COVID-19 outbreak.

Today’s letter was sent to Congressional leadership including Senate Majority Leader Mitch McConnell (R-KY), Senate Democratic Leader Chuck Schumer (D-NY), Speaker of the House Nancy Pelosi (D-CA), Republican Leader Kevin McCarthy (R-CA); leaders of the Congressional committees with jurisdiction over the tax code Chairman Chuck Grassley (R-IA), Ranking Member Ron Wyden (D-OR), Chairman Richard Neal (D-MA) and Ranking Member Kevin Brady (R-TX); Congressional Cooperative Business Caucus Co-chairs Reps. Mark Pocan (D-WI) and Jim Baird (R-IN); Joint Economic Committee Chair Senator Mike Lee (R-UT) and Vice Chair Don Beyer (D-VA); Office of Management and Budget Director Mick Mulvaney; and Treasury Secretary Steve Mnuchin.

NCBA CLUSA will continue to track government response to COVID-19 and provide resources to our members as they become available. For the latest information on COVID-19, including how to prevent illness, the most recent risk assessment and information related to travel advisories, visit the Centers for Disease Control and Prevention’s website.

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