COVID-19 Business Continuity Bulletin
April 23, 2020
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Coats Rose is monitoring the CARES Act and all related regulations and guidance to provide clients with swift and comprehensive advice on the stimulus.
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Paycheck Protection Program (PPP)
: As the initial round of funding for the PPP program became fully depleted within weeks of the opening of the SBA program, the U.S. Senate approved over $300 billion in additional funding for the PPP program; the U.S. House of Representatives is expected to vote on the legislation this week. The legislation would set aside $30 billion for community banks and small lenders, and would allocate another $30 billion to medium-sized lenders. The Small Business Administration (SBA) has published updated PPP guidance, including updated Frequently Asked Questions, a summary of the applicable affiliation rules for purposes of determining eligibility, and an Interim Final Rule exempting otherwise qualified faith-based organizations from the affiliation rules, where the application of the affiliation rules would substantially burden those applicants’ exercise of religion.
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Federal Reserve Provides Details on Main Street Lending Program:
Under a new Main Street Lending Program, lenders can originate new Main Street loans or increase the size of existing loans to small and mid-size businesses with up to 10,000 employees or revenues of less than $2.5 billion. The minimum loan amount is $1 million, and will have a four-year term with principal and interest payments deferred for one year. The Federal Reserve will support this program by purchasing up to $600 billion of unsecured loans made by lenders. Lenders will be able to sell 95% of each Main Street loan to the Federal Reserve. Additional program guidelines will be released in future weeks.
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Federal Reserve Establishes Municipal Liquidity Facility
: The facility will purchase up to $500 billion of short term notes directly from U.S. states and the District of Columbia, certain counties with a population of at least two million residents, and municipalities with a population of at least one million residents. Eligible state-level issuers may then use the proceeds to support smaller counties and cities. Eligible uses of proceeds include managing the cash flow impact of extended income tax filing deadlines; addressing potential reductions of revenues or increases in expenses related to the pandemic; and making payments of principal and interest on debt obligations. The program will end on September 30, 2020 unless extended.
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Federal banking regulators issue revised joint statement discussing loan modifications
: To encourage FDIC-supervised financial institutions to work with borrowers affected by COVID-19, regulators have advised such institutions that COVID-19 related loan modifications generally do not need to be categorized as troubled debt restructurings (TDRs). The statement provides creditors with flexibility to provide short-term loan modifications in response to borrowers who were current prior to the crisis, including modifications such as payment deferrals, fee waivers and extensions of repayment terms. Financial institutions do not need to designate loans with deferrals granted due to COVID-19 as past due during the period of the deferral. The interagency statement is available
here
and an FAQ for financial institutions is published
here.
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U.S. Senate Passes Fourth Stimulus Bill
: The Senate approved a $484 billion COVID-19 stimulus package and the U.S. House of Representatives is expected to vote on the bill later this week. The Paycheck Protection Program and Health Care Enhancement Act includes an additional $310 billion to fund Paycheck Protection Program loans, an additional $60 billion for SBA disaster loans, $75 billion for hospitals and $25 billion for expanded testing.
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U.S. Department of Labor Continues to Update Guidance on Families First Act
: The Department of Labor’s Wage and Hour Division (WHD) issued temporary regulations and published a webinar, workplace posters intended to fulfill certain employer notice requirements, and an updated FAQ regarding the paid leave provisions of the Families First Coronavirus Response Act (FFCRA).
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IRS Permits Partnerships to Amend Returns
: The IRS issued Rev. Proc. 2020-23 allowing partnerships to file amended tax returns for 2018 and 2019 to permit businesses to take advantage of certain retroactive tax benefits provided for in the CARES stimulus package, including the provision retroactively allowing qualified improvement property to qualify for 100% bonus depreciation.
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Additional Opportunity Zone Regulations Released:
The U.S. Department of the Treasury released technical corrections to the final regulations governing the Opportunity Zone Program. The amendments are applicable as of January 13, 2020.
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IRS Extends Deadline to Make Opportunity Zone Investments and Take Other Time Sensitive Actions:
The IRS extended the 180-day deadline for taxpayers to invest capital gains in qualified opportunity funds to July 15, 2020 for taxpayers whose deadline otherwise would have fallen between April 1 and July 15. All taxpayers with deadlines that fall within that time may automatically postpone the investment deadline and do not need to contact the IRS, file any extension forms or submit other documentation to receive this relief. The deadline extension applies to certain other time-sensitive actions, such as compliance with the 45-day identification period and 180-day exchange period in section 1031 exchanges.
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Louisiana Courts Update
: The Louisiana Supreme Court issued updated orders temporarily continuing all jury trials, both civil and criminal, until June 30, 2020. All other civil proceedings, other than certain family and emergency matters, are continued until May 4, 2020. All filings which were or are due to the Supreme Court between March 12, 2020 through May 1, 2020 will be considered timely if filed by May 4, 2020. A list of court orders and announcements issued by each civil district court, court of appeal, and the Louisiana Supreme Court is available at the
Supreme Court’s website
.
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Louisiana Land Records Update
: Louisiana land records offices are either currently closed to the public or have limited their hours of operations in response to the public health emergency. A list of each parish clerk of court’s emergency hours and whether electronic recording is available at a particular parish is published at the Louisiana Clerks of Court Association website, last updated April 20, 2020.
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Remote Notarization Extended through April 30
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Governor Jon Bel Edwards issued Proclamation Number 41 JBE 2020, which extends certain prior proclamations providing for temporary changes during the emergency, including authorizing remote notarization and permitting shareholder meetings that otherwise would be conducted in person to be held remotely.
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Moratorium on Insurance Policy Cancellations/Non-Renewals for Louisiana Policyholders:
Louisiana Commissioner of Insurance Jim Donelon recently issued Emergency Rule 40 to provide Louisiana policyholders with a moratorium on policy cancellations, non-reinstatements and non-renewals by insurance companies and premium finance companies resulting from non-payment of premiums. This rule applies to any and all kinds of insurance, including, but not limited to, health, life, property, vehicle, liability, workers’ compensation, title, crop, marine, etc.; provided, that the policy must have been in effect on March 12, 2020. The rule further provides that no policy can be canceled or non-renewed because of a claim that is filed during the COVID-19 emergency. FEMA has also extended deadlines for payment of national flood insurance program renewal premiums.
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Louisiana Begins Paying Additional Unemployment Benefits
: The Louisiana Workforce Commission began paying additional unemployment benefits authorized under the CARES stimulus package to Louisiana residents on April 13, 2020. The additional $600 per week benefits set to expire by July 31, 2020.
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Kelly Longwell
504.299.3075
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Ben Guider, III
504.299.3084
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Christopher Wootten
504.299.3073
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Molly Stanga
504.299.3081
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Laura Carroll
504.299.3086
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Sarah Yednock
504.299.4006
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Elizabeth Haecker
Ryan
504.299.3085
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Affordable Housing and Community Development
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From site selection to the closing table, Coats Rose attorneys provide in-depth knowledge and experience regarding the legal issues faced by developers, lenders, owners and operators of public and private commercial real estate.
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Coats Rose, P.C.
is a transactional and litigation law firm focused on development: the development of real estate, affordable housing, special purpose districts, business and private wealth. We provide legal counsel to businesses, governmental entities corporate and high-net worth clients across the U.S. and internationally. For over 30 years, the firm has leveraged its vast legal experience to fulfill clients’ needs spanning real estate law, affordable housing and community development, public finance, construction/surety law, commercial litigation, government relations, intellectual property, mergers and acquisitions, securities law, tax, wealth transfer planning and wealth preservation planning.
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