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Federal Register/Vol. 87, No. 18/Thursday, January 27, 2022/Rules and Regulations 4381
<br /> significance") could be eligible for information from their subrecipients to of assistance and subrecipients when
<br /> direct assistance as beneficiaries. complete required reporting. working with impacted industries; for
<br /> Treasury Response:Definition of d. Aid to Impacted Industries further information,see section
<br /> Nonprofit.The final rule expands the Distinguishing Subrecipients versus
<br /> definition of nonprofits to mean The interim final rule allowed for Beneficiaries.
<br /> 501(c)(3) organizations and 501(c)(19) "aid to tourism,travel, and hospitality,
<br /> organizations.234 The 501(c)(3) and other impacted industries"that Designating an Impacted Industry
<br /> classification includes a wide range of responds to the negative economic Public Comment:Many commenters
<br /> organizations with varying charitable or impacts of the COVID-19 public health requested greater clarity on how to
<br /> public service-oriented goals (e.g., emergency. In designating other designate "other impacted industries"
<br /> housing,food assistance,job training). impacted industries,Treasury specified within their jurisdiction.Commenters
<br /> As discussed above,these nonprofit that recipients should consider the requested greater specificity as to the
<br /> organizations often experienced extent of the economic impact as metrics used to measure impact,with
<br /> hardship due to increased needs for compared to tourism,travel, and some suggesting metrics such as the
<br /> services combined with decreased hospitality" and"whether impacts were change in the size of an industry's
<br /> donations and other sources of funding. due to the COVID-19 pandemic,as workforce due to the pandemic,as well
<br /> In response to comments,Treasury has opposed to longer-term economic or as consideration of whether and why
<br /> expanded the definition of nonprofit to industrial trends unrelated to the employees are choosing to return to
<br /> include 501(c)(19) organizations,which pandemic. Treasury identified work at slower rates in certain
<br /> includes veterans' organizations,to declines in employment and revenue as industries. One commenter asked if this
<br /> provide recipients more flexibility and possible metrics to compare the meant nearly every industry was
<br /> in alignment with the definition of economic impact on a particular "disproportionately impacted." Some
<br /> nonprofit adopted by the CARES Act, industry relative to the tourism,travel, commenters encouraged Treasury to
<br /> wherein 501(c)(3)s and 501(c)(19)s were and hospitality industries. focus on industries most negatively
<br /> eligible for assistance.235 Treasury further provided that aid impacted by the pandemic,including
<br /> Public Comment:Reporting should be limited to businesses, disallowing across-the-board business
<br /> Requirements:One commenter asked attractions,business districts,and Tribal subsidies to businesses that were not
<br /> Treasury to clarify if nonprofits that development districts that were negatively impacted by the pandemic
<br /> receive direct assistance as beneficiaries operating prior to the pandemic and and saw revenue or profit growth. Other
<br /> are required to comply with guidelines affected by required closures and other commenters asked for flexibility for
<br /> and reporting requirements. efforts to contain the pandemic. recipients to determine impacted
<br /> Treasury Response:Reporting Examples of eligible aid include industries based on their local
<br /> Requirements:Nonprofits that receive assistance to implement COVID-19 knowledge of the economic landscape.
<br /> direct assistance as beneficiaries are not mitigation and infection prevention Treasury Response:The final rule
<br /> subrecipients under SLFRF and are measures,aid to support safe reopening maintains the interim final rule's
<br /> therefore not required to comply with of businesses in these industries,as well approach of allowing recipients to
<br /> SLFRF reporting requirements. as aid for a planned expansion or designate impacted industries outside
<br /> However,the recipient must comply upgrade of tourism,travel,and the travel,tourism,and hospitality
<br /> with SLFRF reporting requirements, hospitality facilities delayed due to the industries,and,in response to
<br /> which would require reporting pandemic.The interim final rule and comments,provides greater clarity as to
<br /> obligations and expenditures for Treasurys subsequent Compliance and how recipients may designate such
<br /> assistance to nonprofits. The recipient Reporting Guidance also required impacted industries.
<br /> may also choose to establish other forms governments to publicly report Sections 602(c)(1)(A)and 603(c)(1)(A)
<br /> of reporting or accountability as a part assistance provided to private-sector recognize that the tourism,travel, and
<br /> of the recipient's direct assistance businesses under this eligible use and hospitality industries are severely
<br /> program. maintain records of their assessments to negatively impacted by the pandemic.
<br /> A nonprofit entity that receives a facilitate transparency and Under the final rule,recipients may
<br /> transfer from a recipient is a accountability. provide eligible aid (described in further
<br /> subrecipient.Per the Uniform Guidance, Reorganization and Cross-References: detail herein)to the tourism,travel,and
<br /> subrecipients must adhere to the same As detailed above,Treasury has re- hospitality industries. Treasury
<br /> requirements as recipients.Therefore, a categorized some uses of funds in the considers Tribal development districts,
<br /> nonprofit subrecipient may only receive final rule to provide greater clarity.In which are commercial centers for Tribal
<br /> funds to carry out an eligible use of the interim final rule,aid to impacted hospitality,gaming,tourism, and
<br /> SLFRF funds and must comply with any industries to implement COVID-19 entertainment and can include Tribal
<br /> reporting and compliance requirements. mitigation and prevention strategies was enterprises, as part of the tourism,
<br /> Note that recipients are ultimately categorized under Aid to Impacted travel,and hospitality industries that
<br /> responsible for reporting information to Industries;the final rule addresses these have been severely hit by the pandemic.
<br /> Treasury and must collect any necessary hems under the section COVID-19 Mitigation and Prevention in Public Therefore, Treasury reaffirms that Tribal Health. Recipients should also be aware development districts are considered
<br /> 234§35.3 Definitions. f thedifference between beneficiaries impacted industries and recipients may
<br /> 235 Treasury considered expanding the definition of erence eween eneciaries provide eligible aid to them.
<br /> of nonprofit to include 501(c)(6)organizations,as
<br /> Congress later did in the Coronavirus Response and 236 Coronavirus State and Local Fiscal Recovery To identify other industries
<br /> Consolidated Appropriations Act of 2021,but Funds,86 FR at 26795. comparably impacted to the tourism,
<br /> ultimately decided to retain the original CARES Act 237 For a definition of"Tribal development travel,and hospitality industries,
<br /> definition.To the extent impacted by the pandemic, districts,"please see FAQ 2.9 at the following: recipients should undertake a two-step
<br /> 501(c)(6)organizations may be eligible to receive Coronavirus State and Local Fiscal Recovery Funds, process:Identifying an industry and
<br /> funds to support eligible uses that align with their Frequently Asked Questions,as of July 19,2021;
<br /> overall purpose(e.g.,tourism promotion in aid of https://home.treasury.gov/system/files/136/ determining whether that industry is
<br /> an impacted industry). SLFRPFAQ.pdf. comparably impacted.
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