Support Growing for 501(c)(6) Inclusion in Paycheck Protection Program

Although another round of COVID-relief passed Congress without addressing 501(c)(6) associations, there are signs that many legislators are aware of the need to expand eligibility to these groups.

Another round of COVID-19 relief legislation passed through Congress without addressing the needs of revenue-distressed 501(c)(6) associations, but there are encouraging signs that the message from ASAE [PDF] and others is being heard on Capitol Hill.

After 501(c)(6) associations were left out of the Paycheck Protection Program (PPP) created by Congress in the CARES Act several weeks ago, ASAE and thousands of other associations have blanketed Capitol Hill with requests for emergency assistance for the nation’s association community, which is working hard to meet the needs of essential industries and professions while sapping their own diminishing resources for basic operations.

The latest $484 billion pandemic relief bill, which passed the House on April 23, provides another $321 billion for the PPP to keep small businesses and other eligible entities afloat during the ongoing economic downturn, but it does not expand eligibility for the loans to other types of organizations like associations.

ASAE’s recent conversations with congressional offices suggest many legislators are aware of the critical need for assistance for the 501(c)(6) community. A bipartisan sign-on letter [PDF] led by Reps. Chris Pappas (D-NH) and Brian Fitzpatrick (R-PA) and signed by 60 other House members urges House leadership to make local chambers of commerce and other 501(c)(6) associations eligible for assistance through the PPP.

“Unfortunately, just like the small businesses they serve, many local chambers are now experiencing their own financial challenges,” the Pappas-Fitzpatrick letter said. “If these organizations are unable to survive, the path to recovery for our hard-hit Main Street economy will be even more difficult.”

A similar bipartisan letter is in the works on the Senate side. In a separate April 20 letter [PDF] to Senate leadership, Sen. Catherine Cortez Masto (D-NV) has urged Senate leaders to expand eligibility for the PPP to include other types of nonprofit groups, including 501(c)(6)s and 501(c)(4)s.

“I am deeply concerned that without access to any relief, many of these nonprofits, which are often professional organizations, small business associations, tourism and hospitality leagues, local chambers of commerce and social welfare groups, may be forced to shut down operations and payroll,” Cortez Masto said.

With the latest relief package headed for President Trump’s signature this week, ASAE and other associations are targeting the next pandemic measure, already dubbed CARES 2, to finally address the financial distress that associations are under.

“Congress has worked swiftly—through multiple rounds of legislation now—to provide significant relief to individuals, small businesses, and industries impacted by this unprecedented pandemic crisis,” said ASAE President and CEO Susan Robertson, CAE. “Unfortunately, most associations still can’t access this aid and continue to struggle for their very survival. It’s past time for legislative action to address the needs of America’s associations that do so much for the workforce, for the economy, and for society’s betterment. We need relief, specifically for 501(c)(6) associations, through the Paycheck Protection Program, and we need it as quickly as possible.”

(Kameleon007/iStock/Getty Images Plus)

Chris Vest, CAE

By Chris Vest, CAE

Chris Vest, CAE is vice president, corporate communications and public relations at ASAE. MORE

Got an article tip for us? Contact us and let us know!