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U.S. Senate Committee on Banking, Housing, and Urban Affairs

03/28/2020 | Press release | Distributed by Public on 03/28/2020 18:40

Crapo Urges Treasury, Fed to Provide Quick Guidance on Title IV of CARES Act

March 28, 2020

WASHINGTON, D.C. - U.S. Senator Mike Crapo (R-Idaho), Chairman of the U.S. Senate Committee on Banking, urged the U.S. Department of Treasury and the Federal Reserve to act quickly to provide guidance on Title IV of the Coronavirus Aid, Relief, and Economic Security (CARES) Act, which was signed into law on March 27, 2020. As Banking Committee Chairman, Crapo led negotiations on the provisions in Title IV and helped guide the CARES Act through the Senate, and wants to ensure quick, orderly implementation by the agencies.

'I commend Secretary Mnuchin and Treasury staff for the vital role they played in getting this legislation passed and signed into law, as well as Federal Reserve Chairman Powell and his team for the extraordinary actions the Fed has taken to stabilize the economy during this trying time,' said Crapo. 'Now, it is critical to quickly provide the greatest amount of information about how to access resources, who is eligible, where additional information can be obtained, and clarifying qualification of industries with specific characteristics that could otherwise unintentionally impede access.'

The letter stresses the importance of the Treasury Department and Federal Reserve acting quickly to issue guidance to the marketplace to ensure that businesses - including small and medium-sized businesses - States, municipalities, and Tribes understand what programs and facilities are available, the terms and conditions of those programs and facilities, and a point of contact or inquiry portal for them to discuss access to those programs and facilities. It also encourages them to prioritize 13(3) facilities that stabilize markets the FSOC has highlighted, such as mortgage servicing.

A copy of the letter is linked here and pasted below.

The Honorable Steven T. Mnuchin

Secretary

Department of the Treasury

1500 Pennsylvania Avenue NW

Washington, DC 20220

The Honorable Jerome H. Powell

Chairman

Board of Governors of the Federal Reserve System

20th Street and Constitution Avenue NW

Washington, DC 20551

Dear Secretary Mnuchin and Chairman Powell:

The Coronavirus Aid, Relief, and Economic Security (CARES) Act of 2020 allows the Treasury Department and the Federal Reserve to work with our financial system to get liquidity to eligible businesses, States, and municipalities affected by COVID-19 that need support during this crisis in order to stabilize the marketplace. Providing the greatest amount of publicly available information about how to access resources, who is eligible, where additional information can be obtained, and clarifying qualification of industries with specific characteristics that could otherwise unintentionally impede access is crucial. I urge the Treasury Department and Federal Reserve to work quickly to issue guidance to the marketplace to ensure that businesses, including small and medium-sized businesses, States, and municipalities understand what programs and facilities are available, the terms and conditions of those programs and facilities, and a point of contact or inquiry portal for them to discuss access and applicable conditions for those programs and facilities.

Areas that the Treasury and the Federal Reserve need to address quickly include:

(1) Issuing widely-available guidance and FAQs to the marketplace about how the 13(3) facilities will work; terms and conditions for eligible issuers, assets, and collateral; and a point of contact or inquiry portal.

(2) Issuing widely-available guidance and FAQs to the marketplace about how the direct loans will work; terms and conditions for eligible issuers, assets, and collateral; guidance on waivers; and a point of contact or inquiry portal.

(3) Prioritizing 13(3) facilities that stabilize markets that FSOC has highlighted, such as mortgage servicing, providing clear rules of the road on waivers and eligibility, and quickly determining how existing 13(3) facilities will be expanded or modified.

Providing the clarity outlined above, as well as any other necessary publicly-available information, and the Secretary exercising his waiver authority where needed, is imperative to ensuring the support provided to the Federal Reserve's 13(3) emergency lending programs and facilities is as effective as intended by Congress.

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