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Lowenthal calls for 501(c)(5) organizations to be eligible for federal relief and recovery funds

Congressman Alan Lowenthal (CA-47), today, joined with 104 of his House colleagues in calling on House leadership to ensure that 501(c)(5) organizations, like labor unions, are made eligible to receive forgivable relief loans through the Paycheck Protection Program (PPP).

In a letter to House Speaker Nancy Pelosi and Minority Leader Kevin McCarthy, the Members point out that when Congress created the PPP last month as part of the CARES Act, 501(c)(5) organizations were excluded from participating in the program, which provides forgivable loans to small businesses and non-profits to retain their workforce and ensure they can weather the pandemic. This, despite large corporations, faith-based nonprofits, and other 501(c)(3) organizations being eligible.

The Members wrote, “The exclusion of labor unions is a serious impediment to achieving the main goal of the CARES Act—to help workers weather the economic effects of the crisis. In January 2020, the Bureau of Labor Statistics estimated that unions represented 14.6 million hard-working Americans. Now, staggering numbers of union members who work in critical industries have been thrown into financial insecurity as company after company has furloughed or laid off millions of workers.”

The letter also points out that compounding these layoffs, the severity of the coronavirus’ economic disruption has threatened the financial viability of many labor unions as their workers are laid off or furloughed causing dramatic declines in the union member dues that sustain their operations and staff.

The letter concludes by calling on House leadership to ensure labor unions can continue to do the critical work of representing and fighting for rights of workers.

“It is especially critical at this time that the organizations fighting for America’s workers have equal access to the recovery funds made possible by the CARES Act,” the Members wrote, “Unions and their members will be crucial actors in our economic recovery and we urge you to include them as eligible entities for federal support in programs like the PPP.”

Click here to read the full text of the letter, including a full list of signatories.

This article was released by the Office of Congressman Alan Lowenthal.