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COVID-19 Legislation Guide for CCDF Administrators

Published: May 28, 2020
Categories:
Program Administration

Funding Programs in Recent COVID-19 Legislation that Address Needs of Child Care Providers and Child Care Workers

The CARES Act (Coronavirus Aid, Relief, and Economic Security Act, Public Law 116-136) appropriated $3.5 billion for the Child Care and Development Fund (CCDF). In addition, the CARES Act and the Families First Coronavirus Response Act (FFCRA; Public Law 116-127) contain funding programs that, while not specific to child care, could address the needs of child care providers and child care workers. The following tables highlight these other funding programs for state child care lead agencies.

Table 1 shows funding programs that address the needs of child care providers/programs (both centers and family child care – the funding programs are broad enough to encompass both types of providers). Table 2 shows funding programs that address the needs of child care workers. These tables are meant to serve as a “menu” of existing funding programs. If a funding program is of interest, links are included in the “For more information” and “To apply” columns.

This guidance is based on the best available information as of April 28, 2020. Note that program guidance continues to change, some programs may experience a lapse of appropriations, and new or existing programs may receive additional funding.

Table 1. Funding Programs that Address Needs of Child Care Providers (Centers and Family Child Care)

Specific needs resulting from COVID-19

Who qualifies?

How much help will child care providers receive?

Mechanism

Program dates to know

Law

For more information

To apply

Help paying payroll, rent, mortgage interest, and/or utilities (Paycheck Protection Program)

Funds are limited, check SBA website regarding current availability

The following businesses may apply: any small business concern that meets SBA’s size standards (either the industry based size standard or the alternative size standard); any business, 501(c)(3) non-profit organization, 501(c)(19) veterans organization, or Tribal business concern (sec. 31(b)(2)(C) of the Small Business Act) with the greater of 500 employees or that meets the SBA industry size standard if more than 500; any business with a NAICS code that begins with 72 (Accommodations and Food Services) that has more than one physical location and employs less than 500 employees per location; and sole proprietors, independent contractors, and self-employed persons
(Check the program rules to see if affiliates need to be included).

The loan does not require collateral or a personal guarantee, does not require that applicants demonstrate they don’t have credit available elsewhere on reasonable terms, does not require a demonstrated ability to repay, and has no fees paid by the borrower.

Applicants can receive a forgivable loan up to 250 percent of average monthly payroll costs (up to $10 million for an individual borrower or up to $20 million for a single corporate group) for 8 weeks. When certain conditions are met (e.g., retaining employees, no large reductions in wages), all or a portion of the loan is forgivable (i.e., it acts like a grant). Any remaining portion of the loan not forgiven is automatically turned into a loan with an interest rate of no more than 1 percent and a maturity of 2 years. The first six months of payments are deferred.

Loan

Covered loan period: February 15 to June 30, 2020

Paycheck Protection Program (PPP): PL 116-136 Coronavirus Aid, Relief, and Economic Security (CARES) Act, Section 1102 and Section 1106 (forgiveness)

https://www.sba.gov/funding-programs/loans/coronavirus-relief-options...

The loan is serviced by authorized banks and lenders. To find lenders: https://www.sba.gov/paycheckprotection/find

Immediate help paying payroll, rent, mortgage payments, and/or cleaning supplies

Funds are limited, check SBA website regarding current availability

The following businesses with 500 or fewer employees: for-profit, faith-based organizations, sole proprietors, independent contractors, tribal businesses, and cooperatives; businesses with more than 500 employees that are small under SBA’s size standards; and nonprofits of any size.

Up to $10,000 loan advance to be disbursed within three days of a successful application, and does not have to be repaid. Maximum loan amount is $2 million (only the $10,000 advance does not have to be repaid).

Loan

Covered loan period: January 31 to December 31, 2020

Economic Injury Disaster Loan (EIDL) and EIDL Advance: PL 116-136 Coronavirus Aid, Relief, and Economic Security (CARES) Act, Section 1110

https://www.sba.gov/funding-programs/loans/coronavirus-relief-options/ec...

https://covid19relief.sba.gov/

Help paying employee wages (cannot be used if also receiving a loan from the Paycheck Protection Program, above)

Employers, including tax exempt organizations, whose operations have been fully or partially suspended as a result of a government order limiting commerce, travel, or group meetings due to COVID-19; employers, including tax-exempt organizations, who have experienced a greater than 50 percent reduction in quarterly gross receipts compared to gross receipts for the same quarter in 2019.

Public employers (federal, state, and local) are not eligible for the credit. Self-employed individuals are not eligible for a credit for their own self-employment earnings but may be eligible for wages paid to their employees.

50 percent of certain employee wages plus allocable health plan expenses, up to a maximum credit of $5,000 per employee, paid through a fully refundable employment tax credit (i.e., the tax credit paid to the employer may exceed taxes owed by the employer). Which employee wages are eligible depend on size of employer. Advance credits may be available.

Refundable tax credit

Applies to wages paid after March 12, 2020, and before January 1, 2021

Employee Retention Credit: PL 116-136 Coronavirus Aid, Relief, and Economic Security (CARES) Act, Section 2301

https://www.irs.gov/newsroom/faqs-employee-retention-credit-under-the...

Eligible employers can get immediate access to the credit by reducing employment tax deposits they are otherwise required to make or requesting an advance credit on IRS Form 7200, Advance of Employer Credits Due To COVID-19, if the deposits are not sufficient to cover the credit.

Employers should report total qualified wages and the related credits for each calendar quarter on their federal employment tax returns (beginning with the second quarter).

https://www.irs.gov/pub/irs-pdf/f7200.pdf

https://www.irs.gov/newsroom/covid-19-related-employee-retention-credits...

Help employees receive a percentage of unemployment compensation benefits (this is an employer-initiated action to avoid lay-offs)

This benefit for employees is initiated by the employer. The program helps employers avoid layoffs by cutting workers’ hours and providing them with reduced unemployment benefits to help make up for some of the employee's lost income. Under the CARES Act, the federal government will reimburse states that provide this program.

Amount of unemployment compensation varies by state. Currently, 27 states have this program (see https://oui.doleta.gov/unemploy/docs/stc_fact_sheet.pdf). The CARES Act provides grant funding for states to implement or improve administration, and to promote and enroll employers in this program. The CARES Act also increases weekly benefits for employees in Short-Time Compensation programs by $600 per week above the state-provided partial benefit. This amount is not pro-rated by the reduction in hours as long as workers are still part-time.

Unemployment compensation for employees

Federal funding ends December 31, 2020

Additional $600 expires July 31, 2020

Short-Time Compensation Programs: PL 116-136 Coronavirus Aid, Relief, and Economic Security (CARES) Act, Sections 2108, 2109, 2110

https://oui.doleta.gov/unemploy/docs/stc_fact_sheet.pdf

https://www.dol.gov/coronavirus/unemployment-insurance

https://wdr.doleta.gov/directives/corr_doc.cfm?DOCN=9622

https://www.careeronestop.org/LocalHelp/UnemploymentBenefits/unemploy...

For required paid sick leave and expanded family and medical leave

(Reimbursement through refundable tax credits)

Employers who may be eligible for the tax credits include businesses and tax-exempt organizations with fewer than 500 workers that are required to provide paid sick leave or family leave to their employees. Note however that businesses, including a religious or nonprofit organization, with fewer than 50 employees may be able to exempt themselves from the requirements to pay leave for reasons relating to school closure or unavailability of child care if compliance with the requirements would jeopardize the viability of the business.

Certain public employers (federal, state, and local) cannot receive the tax credits even if they are required to provide paid sick leave or family leave to their employees.

Eligible employees:

Eligible employees for expanded family and medical leave include employees described in (1) and (2) in the next column who have worked for the employer for any period of time; or employees described in (3) in the next column who have worked for the employer for at least 30 days. All employees are eligible for paid sick leave, regardless of length of service.

Tax credits are also available to employers with employees described in (3) in the next column. Self-employed individuals, including gig workers, are eligible for an equivalent credit.

Refundable employment tax credit (for self-employed individuals, comparable refundable income tax credit) for 100 percent of qualified leave wages plus allocable qualified health expenses. Paid leave amount varies by the reason the employee is unable to work or telework:

Paid Sick Leave:

(1) Subject to a government quarantine order related to COVID-19, advised by a health care provider to self-quarantine for reasons related to COVID-19, or experiences symptoms of COVID-19 and is seeking a diagnosis.
-- Benefit duration: Up to 80 hours for full-time employees, 2 weeks equivalent for part-time employees.
-- Benefit amount: Employee’s regular pay (or highest applicable minimum wage, if higher), up to $511/day and $5,110 in total.

(2) To care for the employee's child because their school or place of care is closed or child care provider is unavailable, or to care for an individual who is subject to a government quarantine order related to COVID-19 or has been advised by a health care provider to self-quarantine for reasons related to COVID-19.
-- Benefit duration: Up to 80 hours for full-time employees, 2 weeks equivalent for part-time employees.
-- Benefit amount: Two-thirds of the employee’s regular pay (or the highest applicable minimum wage), up to $200/day and $2,000 in total.
-- Note that employees unable to work or telework because their child’s school or place of care is closed or unavailable may be paid using both the 2 weeks in this provision and the 10 weeks in the following provision under paid family leave, for a total of 12 paid weeks. Otherwise, the first 10 days for which an employee takes leave may consist of unpaid leave.
 

Paid Family Leave
(3) To care for the employee’s child because their school or place of care is closed, or child care provider is unavailable.
-- Benefit duration: Up to 10 weeks of paid family leave.
-- Benefit amount: Not less than two-thirds of the employee’s regular pay (or applicable minimum wage, if higher), up to $200/day and $10,000 in total.

Payments from employers to workers, reimbursed with a refundable tax credit

Effective April 1 to December 31, 2020

Emergency Paid Sick Leave Act, Emergency Family and Medical Leave Expansion Act, Tax Credit for Paid Sick and Paid Family and Medical Leave: PL 116-127 Families First Coronavirus Response Act,

https://www.irs.gov/newsroom/covid-19-related-tax-credits-for-require...

https://www.dol.gov/agencies/whd/ffcra

https://www.dol.gov/agencies/whd/pandemic/ffcra-questions

Eligible employers can fund qualified leave wages immediately by reducing employment tax deposits they are otherwise required to make or by requesting an advance credit on IRS Form 7200, Advance of Employer Credits Due To COVID-19, if the deposits are not sufficient to cover the credit.

Employers should report total qualified wages and the related credits for each calendar quarter on their federal employment tax returns (beginning with the second quarter).

https://www.irs.gov/pub/irs-pdf/f7200.pdf

https://www.irs.gov/newsroom/covid-19-related-tax-credits-how-to-claim-t...

Help providing meals to children

School lunch programs, school breakfast programs, child and adult care food programs, and summer food service programs for children

To make it easier for providers to provide meals, the following changes are allowable by the state agency:
1) Waive certain program requirements under the National School Lunch Program, School Breakfast Program, Summer Food Service Program, and Child and Adult Care Food Program.
2) Allow non-congregate feeding (serve outside the school/care setting).
3) Adjust nutritional content as needed based on food supply chain disruption.

Waivers

N/A

Maintaining Essential Access to Lunch for Students (MEALS) Act: PL 116-127 Families First Coronavirus Response Act, Sec 2102

Child Nutrition Program: PL 116-127 Families First Coronavirus Response Act, Sec 2202

https://www.fns.usda.gov/disaster/pandemic/covid-19

Some nationwide waivers already applied; other waivers given on a state by state basis. See: https://www.fns.usda.gov/disaster/pandemic/covid-19 and https://www.fns.usda.gov/disaster/pandemic/covid-19/cn-waivers-flexib...

Assistance from states

N/A (States have discretion to use these funds to address necessary child care expenditures in responding to COVID-19, as long as the expenses were not accounted for in the most recently approved budget (i.e., was not on the "business as usual" budget prior to the COVID-19 crisis)).

$150 billion total allocated to states (for state’s allocation, see https://crsreports.congress.gov/product/pdf/R/R46298).

N/A

Expenditures must be incurred between March 1 and December 30, 2020

Coronavirus Relief Fund: PL 116-136 Coronavirus Aid, Relief, and Economic Security (CARES) Act, Title V

https://crsreports.congress.gov/product/pdf/R/R46298

N/A

 

Table 2. Funding Programs that Address Needs of Child Care Workers

Specific needs resulting from COVID-19

Who qualifies?

How much help will child care employees receive?

Program dates to know

Law

For more information

To apply

Help with cash relief

Individuals who file (or have filed) taxes in 2018 or 2019, eligible Social Security beneficiaries, recipients of Railroad Retirement, or veterans benefits, as well as individuals who do not make enough money to normally have to file a tax return. This includes those who have no income, as well as those whose income comes entirely from federal benefit programs, such as Supplemental Security Income benefits. No minimum income is needed for the payment.

$1,200 for singles and heads of households, $2,400 for married couples filing joint returns. The provision also provides $500 per qualifying child dependent under age 17. Rebates phase out at a 5 percent rate above adjusted gross incomes of $75,000 (single)/ $122,500 (head of household)/ $150,000 (joint).

Payments  continue through the 2020 tax season

Economic Impact Payments (stimulus checks): PL 116-136 Coronavirus Aid, Relief, and Economic Security (CARES) Act, Sections 2201

https://www.irs.gov/coronavirus/economic-impact-payment-information-c...

For individuals who have already or plan to file taxes (deadline extended to July 15, 2020), no additional action is needed. To check payment status, visit: https://www.irs.gov/coronavirus/get-my-payment

For individuals not required to file taxes, enter information here to receive the payment: https://www.irs.gov/coronavirus/non-filers-enter-payment-info-here

No action is necessary for recipients of Social Security benefits to receive their benefits, although additional action may be necessary for qualifying dependents.

Help with unemployment compensation (UC)

(With respect to self-employed individuals applying for PUA, participation in the Payroll Protection Program may affect eligibility for state-administered unemployment compensation or unemployment assistance programs, including the programs authorized by Title II, Subtitle A of the CARES Act or CARES Act Employee Retention Credits.)

Pandemic Unemployment Assistance (PUA): Individuals who are not eligible for regular UC or extended benefits under state or federal law or Pandemic Emergency Unemployment Compensation (PEUC), including those who have exhausted all rights to such benefits. Also includes self-employed workers (including gig workers), individuals lacking sufficient work history, individuals seeking part-time work. Must meet program’s eligibility requirements, including that the individual’s unemployment or partial unemployment is due to a COVID-19-related reason. Examples of those included are individuals scheduled to begin employment who don’t have a job or are unable to reach the job, individuals whose place of employment is closed, individuals who become sick from COVID-19, or individuals who cannot work because they must care for a family member who has COVID-19 or for children due to school closures

PEUC: Individuals who have received all entitlement to state UC.

FPUC: Individuals receiving benefits from many programs including state UC, PUA, and FPUC.

Benefit amount:

PUA and PEUC weekly benefit amount: Existing state amount (national weekly average is $385) for individuals with sufficient earnings to qualify for state amounts. Different amounts are available for other workers.

FPUC weekly benefit amount: An additional $600 for each week an individual receives other unemployment benefits.

Benefit duration:

PUA: A total of 39 weeks of benefits.

PEUC: 13 weeks of benefits.

PUA and PEUC programs ends December 31, 2020

FPUC expires for weeks of unemployment ending on or before July 31, 2020

Pandemic Unemployment Compensation Pandemic Unemployment Assistance (PUA): PL 116-136 Coronavirus Aid, Relief, and Economic Security (CARES) Act, Section 2102. See also CARES Act Section 2104 Federal Pandemic Unemployment Compensation (FPUC) and Section 2107 Pandemic Emergency Unemployment Compensation (PEUC)

https://www.dol.gov/coronavirus/unemployment-insurance

https://wdr.doleta.gov/directives/corr_doc.cfm?DOCN=3390

https://wdr.doleta.gov/directives/corr_doc.cfm?DOCN=9297

https://wdr.doleta.gov/directives/corr_doc.cfm?DOCN=4628

https://wdr.doleta.gov/directives/corr_doc.cfm?DOCN=8452

https://www.careeronestop.org/LocalHelp/UnemploymentBenefits/unemploy...

Paid leave for employees

Employers who may be eligible for the tax credits include businesses and tax-exempt organizations with fewer than 500 workers that are required to provide paid sick leave or family leave to their employees. Note however that businesses, including a religious or nonprofit organization, with fewer than 50 employees may be able to exempt themselves from the requirements to pay leave for reasons relating to school closure or unavailability of child care if compliance with the requirements would jeopardize the viability of the business.

Certain public employers (federal, state, and local) cannot receive the tax credits even if they are required to provide paid sick leave or family leave to their employees.

Eligible employees:

Eligible employees for expanded family and medical leave include employees described in (1) and (2) in the next column who have worked for the employer for any period of time; or employees described in (3) in the next column who have worked for the employer for at least 30 days. All employees are eligible for paid sick leave, regardless of length of service.

Tax credits are also available to employers with employees described in (3) in the next column. Self-employed individuals, including gig workers, are eligible for an equivalent credit.

Paid leave amount varies by the reason the employee is unable to work or telework:

Paid Sick Leave:

(1) Subject to a government quarantine order related to COVID-19, advised by a health care provider to self-quarantine for reasons related to COVID-19, or experiences symptoms of COVID-19 and is seeking a diagnosis.
-- Benefit duration: Up to 80 hours for full-time employees, 2 weeks equivalent for part-time employees.
-- Benefit amount: Employee’s regular pay (or highest applicable minimum wage, if higher), up to $511/day and $5,110 in total.

(2) To care for the employee's child because their school or place of care is closed or child care provider is unavailable, or to care for an individual who is subject to a government quarantine order related to COVID-19 or has been advised by a health care provider to self-quarantine for reasons related to COVID-19.
-- Benefit duration: Up to 80 hours for full-time employees, 2 weeks equivalent for part-time employees.
-- Benefit amount: Two-thirds of the employee’s regular pay (or the highest applicable minimum wage), up to $200/day and $2,000 in total.
-- Note that employees unable to work or telework because their child’s school or place of care is closed or unavailable may be paid using both the 2 weeks in this provision and the 10 weeks in the following provision under paid family leave, for a total of 12 paid weeks. Otherwise, the first 10 days for which an employee takes leave may consist of unpaid leave.
 

Paid Family Leave:
(3) To care for the employee’s child because their school or place of care is closed, or child care provider is unavailable.
-- Benefit duration: Up to 10 weeks of paid family leave.
-- Benefit amount: Not less than two-thirds of the employee’s regular pay (or applicable minimum wage, if higher), up to $200/day and $10,000 in total.

Effective April 1 to December 31, 2020

Emergency Family and Medical Leave Expansion Act, Emergency Paid Sick Leave Act: PL 116-127 Families First Coronavirus Response Act

https://www.irs.gov/newsroom/covid-19-related-tax-credits-for-require...

https://www.dol.gov/agencies/whd/ffcra

Employer is required to provide paid leave upon eligible employee’s request. https://www.dol.gov/agencies/whd/pandemic/ffcra-questions#16

Help child care employees who themselves are parents access additional food support for their own children

Children eligible for free or reduced price school meals (including those attending schools that participate in the Community Eligibility Provision) in participating states. This is in addition to meals that may continue to be provided by schools.

Operating the program is at the state’s discretion. States that choose to participate will provide the value of a free breakfast/lunch for five school days/week ( about $116/month per child in contiguous U.S.) for each eligible child on an EBT card to purchase food.

During school closure days in FY2020, if  schools in a state are closed for at least 5 consecutive days due to COVID 19

Pandemic EBT: PL 116-127 Families First Coronavirus Response Act, Sec 1101

https://www.fns.usda.gov/snap/state-guidance-coronavirus-pandemic-ebt...

Families who receive SNAP may automatically receive P-EBT benefits on their existing EBT card. Processes for non-SNAP families vary by state.

Relief for most student loan borrowers

Individuals (including child care employees) who have federal student loans held by the federal government.

The U.S. Department of Education will automatically suspend payments on most federal student loans from March 13 through September 30, 2020. No interest will accrue on covered loans during this time. 

All months of payment suspension will count as “qualifying payments” for borrowers working toward forgiveness under Public Service Loan Forgiveness, as long as they would have otherwise qualified, or income-driven repayment.

Effective March 13 to September 30, 2020

Coronavirus Aid, Relief, and Economic Security (CARES) Act, PL 116-136 Section 3513

https://studentaid.gov/announcements-events/coronavirus

No action is needed. To find out if this applies to your student loan, visit: https://studentaid.gov/announcements-events/coronavirus#borrower-ques...

 

Note: There are additional food/nutrition benefits, such as Special Supplemental Nutrition Program for Women, Infants, and Children (WIC) waivers, the Disaster Household Distributions, and the Emergency Food Assistance Program (TEFAP) that are good resources but likely not specific to the child care setting. All food/nutrition benefit information can be accessed at https://www.fns.usda.gov/disaster/pandemic/covid-19.

Last Reviewed: May 28, 2020