(Editor’s note: The following message was sent by the American Society of Association Executives – ASAE. There is a critical call to action included. Please read through this closely. Please take a moment to click the link and send to your Senators. The best approach is to add a personal note during the introduction.)
Dear Members and Advocates:
We reported last week on a proposed Senate COVID-19 relief measure that would expand eligibility under the Paycheck Protection Program (PPP) to include all 501(c)(6) organizations with 300 or fewer employees.
We also highlighted bill’s vague lobbying restrictions that would be used to further determine eligibility. We are concerned small organizations that typically do not lobby much would be inappropriately labeled as lobbying organizations and that the restrictions could exclude most, if not all, organizations that lobby on a modest basis.
If a 501(c)(6) organization employs 300 or fewer people, it would only be eligible for a PPP loan if:
- “the organization does not receive more than 10 percent of its receipts from lobbying activities;” and/or
- “the lobbying activities of the organization do not comprise more than 10 percent of the total activities of the organization.”
Ten percent is a low threshold for any organization, but, unlike for 501(c)(6) organizations, these proposed restrictions would not apply to businesses and other nonprofits.
The lobbying provisions are so vague that we don’t know what exactly will be calculated to determine “receipts” or “lobbying activities.” These provisions would permit the Small Business Administration (SBA) to create its own definitions, criteria, metrics, etc., to examine “receipts” and “lobbying activities.” SBA could use pre-existing definitions or create its own, which could look beyond what is typically considered lobbying and receipts.
If given the opportunity, we expect SBA will make the application process as stringent as possible.
Bottom line: these provisions could exclude nonprofit associations, chambers of commerce and others from receiving critical financial relief when they need it most. For others, these proposed restrictions would create a significant administrative burden and subsequently delay relief.
Collectively, we must urge Congress to ensure 501(c)(6) organizations gain access to PPP funds and these unfair lobbying restrictions are made more inclusive or eliminated altogether.
SIAC Call to Action
ASAE staff remains in discussion with several key congressional offices regarding these restrictions, but we still need your help to maximize our community’s outreach.
- Adapt our template Tweetto urge SenatorsMitch McConnell, Marco Rubio and Susan Collins – and/oryour legislators – to support PPP expansion on inclusive, equitable terms.
- Write your legislators directly with ourautomated congressional appeal. The appeal is ready to send, but feel free to customize your message.
Champions in the House of Representatives
U.S. Congressman Greg Steube (R-Fla.), with a delegation of Representatives Darren Soto (D-Fla.), Neal Dunn (R-Fla.), Ross Spano (R-Fla.) and Brian Mast (R-Fla.), delivered a letter to Senator Marco Rubio that reiterates their support to include 501(c)(6) organizations in the PPP. As a reminder, these Members cosponsor the Local Chamber, Tourism, and 501(c)(6) Protection Act of 2020 (H.R. 6697), introduced in April, which would expand the PPP to our community.
Congressman Steube announced his letter on Twitter, and we encourage you to retweet thanks to Reps. Steube, Soto, Dunn, Spano and Mast. Take a look at ASAE’s thank you Tweet. ASAE helped create this letter and we are extremely grateful for Congressman Steube’s leadership.
Reminder: Complete ASAE’s Data Request Form
WE NEED DATA to further demonstrate to Congress why these unfair restrictions must be lifted, and that any PPP eligibility expansion should replicate terms provided to other eligible entities. We again respectfully ask for your time to support – please complete our data request form as soon as possible to help us unequivocally demonstrate our community’s need and help save imperiled organizations. While not exhaustive, the form is somewhat long out of necessity. We greatly appreciate your patience as you complete the form to the best of your knowledge. Thank you to the more than 475 organizations who have already completed the form.
Final Thought
While legislation remains fluid, if PPP expansion to 501(c)(6) organizations indeed passes into law, such entities will need to move fast to secure PPP loans and the financial relief they need. We encourage you to consider your options now so, if needed, you can expeditiously pursue PPP loan funds when the time comes.
On August 18, ASAE will host an education session with experts and leading voices in association law, finance and accounting to examine options and how to apply for a PPP loan. We will share final details and a registration link when they become available.
THANK YOU for your steadfast advocacy to help build support for the 501(c)(6) community.