Travel agencies will be able to apply for new loan programs
and self-employed agents will be eligible for unemployment benefits under the
$2 trillion Coronavirus Aid, Relief, and Economic Security (Cares) Act agreed
upon by congressional leadership and the Trump administration.
While the bill hasn’t been approved by Congress or signed by
the president, as it stood on Wednesday, it includes new loan programs. Notably,
agencies can apply for Airline Economic Stabilization Loans.
And, there are unemployment benefits for the self-employed, which
is particularly relevant to the large segment of independent contractors
working as travel advisors.
The bill is expected to be approved and signed into law, but
changes could still be made, ASTA said.
ASTA president and CEO Zane Kerby called the coronavirus
pandemic ASTA’s biggest challenge to date.
“Over the past few weeks, we have worked hand in hand with
our 13,000 members to secure the maximum amount of relief for the travel agency
community in this package,” Kerby said in a statement. “The fact that agencies
are included in the airline assistance portion of the bill is a huge win and
means that Congress heeded our call to include our members in any targeted
travel industry relief.”
The Society identified four key provisions in the bill that
will benefit agencies.
First, travel agencies will be eligible for Airline Economic
Stabilization Loans. Under this provision, airlines, ticket agents (travel
agencies) and other related aviation businesses will be eligible for loans,
loan guarantees and other aid totaling $25 billion.
Second, a new Small Business Administration loan program -- the
Small Business Interruption Loans/Paycheck Protection Program -- is funded with
$349 billion. Under the program, businesses eligible for SBA loans -- for agencies, that means $22 million in annual
revenue or less or with 500 or fewer employees -- can apply for loans of up to
$10 million. Independent contractors and self-employed individuals are
eligible, ASTA said, and the loans do not have collateral or personal guarantee
requirements. The portion of the loans used to cover the business’ payroll,
mortgage, rent or utilities from Feb. 15 to June 30 can be forgiven.
ASTA has been asking for SBA loans with lesser or no
collateral requirements from the beginning, as service-oriented travel
agencies, especially those that are home-based, don’t have much collateral.
The third travel agency-eligible provision establishes
Economic Stabilization Loans for Severely Distressed Sectors, funded with $425
billion. The U.S. Treasury Department will be able to extend low- or
no-interest loans and loan guarantees to U.S. businesses with losses resulting
This provision does have a caveat, ASTA said: “This relief
is only open to a ‘business that has not otherwise received adequate economic
relief in the form of loans or loan guarantees provided under this Act,’ -- meaning the business could not also apply for
the new SBA program.
Finally, the Cares Act would extend unemployment benefits
for the unemployed for up to 39 weeks.
ASTA said that provision was one of its priorities, because
it includes the self-employed. In the agency community, that means some 40,000
ICs who typically wouldn’t be eligible for unemployment benefits can get relief.
Now, ASTA will turn to analyzing the full Cares Act for
other provisions that will impact members. It will also look into how the new
SBA loan program will work with existing Disaster Relief programs, and how funds
from the new program will be distributed.
A webinar for members is planned for Friday, March 27, at 3
p.m. At that time, ASTA will present its preliminary analysis of the CARES Act.
Kerby thanked ASTA members for their support. A record of
more than 28,000 messages were sent to legislators through the Society’s online
ASTA encouraged travel advisors to sign up for its Travel
Advisor Daily newsletter
to stay up to date. It is also holding
coronavirus update webinars
every Monday. While both have been filled to capacity thus far, the webinars
are recorded and available to anyone who can’t access them live.