(The Center Square) – Lawmakers in Virginia have included additional help for businesses in their budget bill, but not to the extent requested by some in the business community.
A budget review, which passed by the General Assembly on Monday and was signed into law by Gov. Ralph Northam on Tuesday, allocated more than $ 3 billion in federal COVID-19 relief money provided through the plan to American rescue. It included $ 353 million for small businesses and $ 862 million for the Unemployment Insurance Trust Fund, but members of the business community have expressed concern that it is not fully meeting the needs. companies in difficulty.
Money for Small Businesses includes $ 250 million for the Rebuild VA Economic Stimulus Fund, which provides grants to small businesses that have been affected by the COVID-19 pandemic and subsequent economic restrictions. It also recognizes the companies hardest hit by industry-specific funding, including $ 50 million for travel and hospitality and $ 53 million for the Industrial Revitalization Fund and the Virginia Main Street program.
Robert Melvin, director of government affairs for the Virginia Restaurant, Lodging & Travel Association, told The Center Square his association was happy with the new aid and the travel and hospitality fund. However, he criticized a provision in the law – restaurants whose paycheck protection program loans have been canceled will not be eligible to receive industry-specific funding.
P3 loans were made by the federal government to maintain the payroll, not to recoup losses caused by the pandemic, Melvin said. While he thanked lawmakers for recognizing the impact of the pandemic on businesses, he said businesses were still struggling and these restaurants should not be excluded from industry-specific funds. He said many restaurants are still struggling to find workers and are facing issues with rising costs of goods.
The bill also downplayed the economic damage businesses would have suffered as a result of the dilapidated unemployment insurance trust fund. The program is primarily funded by corporate payroll taxes, and the state’s funding formula automatically increases these taxes when the money falls too low. The $ 862 million will prevent a tax hike for the immediate future, but may not completely fix the fund.
To make sure businesses don’t face future tax increases, Melvin said the fund should be reviewed at the next regular session.
Some Republican lawmakers attempted to include enough funds to fully offset losses from the legislation, but Democratic leaders did not include it in the final money bill.
The legislation, House Bill 7001, was passed by the House of Delegates 78-20 and the Senate 23-16.