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A draft copy of the large $2 trillion Senate coronavirus rescue package deal anticipated to be handed on Wednesday would bar companies receiving federal loans from stock buybacks for one yr after the mortgage is paid again.
The bill authorizes $25 billion in loans to passenger air carriers, $four billion to cargo air carriers, and $17 billion for “companies crucial to sustaining nationwide safety.” It additionally authorizes as much as $454 billion in loans to different eligible companies in any other case unable to obtain credit score.
The laws would additionally bar giant companies from paying dividends to shareholders for one yr after the mortgage is paid again, and from decreasing their employment ranges by 10% till the top of September. Midsized companies would be barred from paying dividends whereas the mortgage is excellent.
Along with loans, the laws additionally authorizes money grants to these within the airline business. It calls for $25 billion in grants for passenger airways, $four billion for cargo carriers and $three billion for contractors.
The grant circumstances name for a pause on dividends and buybacks via September 2021 and a pledge to “chorus from conducting involuntary furloughs or decreasing pay charges and advantages till September 30, 2020.”
Liberals and a few high-profile conservatives expressed help for circumstances on taxpayer help to companies hit by COVID-19. President Donald Trump, throughout a White Home information briefing final week, mentioned he supported such a provision. Sen. Elizabeth Warren, a former Democratic presidential candidate, contended that bailed-out companies ought to be barred from conducting buybacks completely.
The textual content of the laws must be finalized and voted on by the Senate, authorised by the Democratic-controlled Home of Representatives and signed by Trump earlier than changing into regulation.
The Senate is anticipated to take up the laws later Wednesday. The Home is unlikely to vote on the matter till Thursday.
— #’s Kayla Tausche contributed to this report.