CARES Act Summary

Posted By: Aaron Greenfield Member Outreach ,


The Coronavirus Aid, Relief, and Economic Security (CARES) Act, which has passed both the Senate and the House, includes important provisions to mitigate the sharp economic decline.  The CARES Act contains a number of provisions that will have significant impact on the apartment industry:

  1. Housing
  • Allows owners of properties that have a federally backed multifamily mortgage loan to seek forbearance because of a financial hardship during the COVID–19 emergency for up to 90 days. However, this provision of the law prohibits issuing a notice to vacate, initiating an eviction filing, or assessing fees, penalties or other charges on residents for nonpayment or late payment of rent during the forbearance period. Additionally, a multifamily borrower that receives forbearance under this section may not issue a notice to vacate until after the expiration of the forbearance period or require a renter to vacate until 30 days after the notice to vacate has been issued.


  • Creates a temporary eviction moratorium for 120 days beginning on the date of enactment which applies to covered dwellings[1]in covered properties. This provision is separate and apart from the forbearance requirements. The mandate prohibits issuing a notice to vacate, initiating an eviction filing, or assessing fees or penalties on residents for nonpayment of rent. Additionally, rental housing providers covered under this section may not issue a notice to vacate until after the expiration of the moratorium or require a renter to vacate until 30 days after the notice to vacate has been issued.
    • The moratorium applies to: rental housing providers whose properties are insured, guaranteed, supplemented, protected, or assisted in any way by HUD, the Federal Housing Administration, Fannie Mae, or Freddie Mac; or **participate in the Section 202 Supportive Housing for the Elderly Program; the Section 811 Housing for Persons with Disabilities Program; Housing Opportunities for Persons With AIDS (HOPWA) Program; McKinney-Vento Homelessness Assistance Programs; Section 236 properties; Section 221(d)(3) below market and reduced interest rate program (BMIR); the Section 8 Housing Choice Voucher (HCV) Program; Section 8 project-based housing; HOME grantees; rural housing assistance programs; and Low Income Housing Tax Credit (LIHTC) properties (**references in the law to rental housing providers of covered properties who must comply with the requirements of the Violence Against Women Act of 1994).
    • Note: You should communicate to residents that for covered properties, the 120-day suspension of evictions in no way removes a resident's responsibility to pay rent or comply with the terms of the lease agreement.


  • Provides the HUD Secretary with discretion to waive program requirements to encourage more participation in the agency’s housing programs.


  • $5 billion to the Community Development Block Grant (CDBG) program to enable nearly 1,240 states, counties and cities to rapidly respond to COVID-19 and the economic and housing impacts caused by it. 
    • Of the amounts provided, $2 billion will be allocated to states and local governments that received an allocation under the fiscal year 2020 CDBG formula;
    • $1 billion will go directly to states to support a coordinated response across entitlement and non-entitlement communities; and
    • $2 billion will be allocated to states and local governments based on the prevalence and risk of COVID-19 and related economic and housing disruption.


  • $1 billion to allow the continuation of housing assistance contracts with participating rental housing providers for over 1.2 million Project-Based Rental Assistance (PBRA) households and gives the HUD Secretary discretion to waive program requirements to encourage more participation in the program.


  • $1.25 billion in Tenant-Based Rental Assistance (TBRA) until expended. Specifically, these funds would be used to provide additional funding for Public Housing Agencies (PHAs) to maintain normal operations during the period significantly impacted by coronavirus. Of these amounts:
    • $850 million would be available for both administrative expenses and other expenses of PHAs for their Section 8 programs.
    • $400 million would be used for adjustments in the calendar year 2020 Section 8 renewal funding allocations for agencies that experience a significant increase in voucher per-unit costs.
    • Note: The Secretary will be afforded broad waiver authority for dealing with circumstances related to coronavirus but must notify the public of the use of such waiver authority.


  • $65 million for housing for the elderly (Section 202) and persons with disabilities (Section 811) for rental assistance for the more than 114,000 affordable households for the elderly and over 30,000 affordable households for low-income persons with disabilities.
    • Of these funds, $10 million would be used for service coordinators and existing service grants for residents of Section 202 assisted housing projects.


  • $65 million for rental assistance and to expand operational and administrative flexibilities for housing and supportive service providers under the Housing Opportunities for Persons With AIDS (HOPWA) Program. 


  • 5 million for special fair housing enforcement grants, education and outreach.


  • $14.250 billion will be available for higher education emergency relief for institutions. Funds may be used to defray expenses for institutions of higher education, including housing.


  • Allows the United States Department of Veterans Affairs (VA) to enhance housing initiatives for homeless veterans, including temporarily eliminating funding limits for programs providing direct support services to homeless veterans.
  1. Tax


  • Provides eligible businesses with a 5-year carryback of net operating losses (NOLs) for 2018, 2019 and 2020.


  • Suspends the limits on excess business losses to ensure the real estate partnerships can take advantage of the NOL carryback provision.


  • Increases the limitation on deductible business interest from 30 percent to 50 percent of earnings before interest, taxes, depreciation and amortization (EBITDA) for 2019 and 2020.


  • Provides a deferral of employer share of Social Security payroll taxes (6.2 percent) from date of enactment until the end of 2020; deferred amount must be repaid in 2020 (50 percent) and 2021.


  • Excludes from income the cancellation of debt related to new, emergency small business loans.


  • Creates a new retention tax credit for employers to encourage businesses to keep workers on payroll during the crisis.
  • Small Business
  • Expands the Small Business Administration’s Standard 7(a) Loan, Express Loan and Economic Injury Disaster Loan (EIDL) Program.


  • Allows employers with fewer than 500 employees, or who fit within the SBA’s size standards for the rental housing industry, as well as Section 501(c)(3)s, Section 501(c)(19)s and Tribal businesses with fewer than 500 employees, to apply for up to $10 million in 7(a) financing for rent, mortgage, utility and payroll obligations.


  • Provides an opportunity for 7(a) loan forgiveness if an employer is able to document that the business has not reduced the number of employees or their salary and wages.


  • Creates an employee retention tax credit that will refund up to 50 percent of what businesses spend on employee wages, up to $5,000 per employer, if the business can certify they suffered financially, compared to their positioning in the previous year.


  • Increases the maximum allowable assistance within the SBA Express Loan program from $350,000 to $1,000,000 for eligible businesses.


  • Allows applicants for the EIDL Program to request for a $10,000 advance to be delivered within three days.


  • Prohibits borrowers from comingling multiple SBA loan types.



[1] Covered dwelling” is defined as any dwelling which (a) is occupied by a tenant pursuant to (i) a residential lease, or (ii) without a lease or with a lease terminable under state law, and (b) is on or in a “covered property.”  “Covered property” means any property that (a) participates in (i) a covered housing program (as defined in section 41411(a) of the Violence Against Women Act of 1994 (codified at 34 U.S.C. 12391(a))) or (ii) the rural housing voucher program under section 542 of the Housing Act of 1949 (codified at 42 U.S.C. 1490r), or (b) has a (i) federally-backed mortgage loan, or (ii) federally-backed multifamily mortgage loan.