After bumpy start, more agencies able to tap Cares Act money

|
After bumpy start, more agencies able to tap Cares Act money
Photo Credit: Tetiana Yurchenko/Shutterstock

While many travel agencies still await funding to help them make it through the coronavirus crisis, the number of agencies that have actually received funding is increasing. At the same time, ASTA is working to ensure the agency community is well served with any future federal aid packages.

According to an ASTA survey administered from May 1 to 8, 64.8% of nearly 600 respondents had applied for a Paycheck Protection Program (PPP) loan, and 56.2% had been approved, compared with 20.1% who had been approved as of April 20, in a previous survey. ASTA found 61.7% had applied for an Economic Injury Disaster Loan (EIDL), and 25.9% had been approved as of May 8, compared with 7.1% as of April 20. Seventy-six percent had applied for unemployment benefits in their state, and 33.4% had been approved, compared with 13.8% as of April 20.

"We're trying to get to 100% on all those numbers, obviously, but it's been encouraging that there has been some positive movement," said Eben Peck, ASTA's executive vice president of advocacy.

The PPP was introduced under the Coronavirus Aid, Relief and Economic Security (Cares) Act, the $2 trillion federal relief package signed into law in late March. It also established that unemployment benefits are available for the self-employed. Additionally, the Cares Act set aside some $25 billion for airlines and "ticket agents," or travel agencies, meant for the largest of agencies. (Peck said applications for those loans were due April 17 and that there has been little movement.) Agencies have also been able to apply for EIDL loans, which were available before the Cares Act, and for grants of up to $10,000 under that program.

Peck said he expects the number of agencies that receive funding to go up, especially those that have applied for the PPP and unemployment. 

The EIDL program has run out of funding and is not taking new applications, but the PPP benefited from an additional round of funding in April and still had about 40% of those monies as of last week. Many states were left scrambling to accept unemployment applications from the self-employed, but Peck said that the number of beneficiaries will likely improve.

Consortia member agencies have reported largely positive results with regard to funding.

Many of Signature Travel Network's members applied for PPP funding, and more than 90% have received it, president and CEO Alex Sharpe said. Of those who have applied for EIDL funding, most have gotten the grant money, and just a handful have received a loan. Signature has turned its attention to fully understanding the forgivable portion of the loan in order to advise its members.

A number of Ensemble Travel Group agencies had not received any PPP or EIDL funds by late April, but CEO David Harris said that has turned around, which he called "encouraging." But he said it's still uncertain what agencies will do once they reach the end of the eight-week forgiveness period tied to the PPP.

Travel Leaders Network president Roger Block said the network -- the "vast majority" of whom had received PPP funding -- had similar concerns about the program.

Congress is mulling further relief. House Democrats introduced a $3 trillion relief bill on May 12, but it reportedly faces steep opposition from Republicans.

Meanwhile, ASTA continues to lobby for travel agency relief in whatever packages might be introduced. 

The Society's asks include increasing funding for the PPP, extending it through Dec. 30, increasing loan forgiveness provisions to 12 weeks and increasing the loan terms to at least five years. ASTA is also asking for additional funding for ticket agent loans designed for the largest agencies.

With all industries vying for aid, Peck said, "It's a challenging environment to get your voice heard, but we're going to keep pushing."

Comments

From Our Partners

2020 Crystal Webinar
Crystal River Cruises: True Luxury on the Rivers of Europe
Register Now
Happy Tours
Happy Tours
Read More
2020 Uganda Webinar 2
Uganda’s Vast Horizons Await
Register Now

JDS Travel News JDS Viewpoints JDS Africa/MI