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This fact brief was originally published as an experiment to test the concepts behind fact briefs.
Readers should be aware that while there is still a lot of useful information in fact briefs like this one, not all of them reflect Gigafact's current methods and standards for fact briefs. If you come across any that you feel are out of date, don't hesitate to contact us at support@gigafact.org.
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FACT BRIEF

Is a $500 billion loan program in the March coronavirus relief package projected to cost taxpayers nothing?

By Austin Tannenbaum
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YES

In its April 2020 assessment of the deficit impact of the $2.2 trillion coronavirus relief package, the Congressional Budget Office estimated that one component, $500 billion of loan guarantees for big businesses, would not have a "net effect" on the budget. The CBO is a non-partisan agency that makes cost estimates for proposed legislation. It noted that the program was similar in structure to loan guarantees offered during the 2008-2009 financial crisis, which actually made a profit for the government.

Democrats had criticized the provision as a "slush fund" that lacked transparency, as neither borrowers nor sums borrowed would be disclosed for six months. Under the approved program, a special inspector will oversee the loans, all of which must be publicly disclosed. The program also includes a ban on stock buybacks extending one year past any loan's repayment.

This fact brief is responsive to conversations such as this one.
Sources
Congressional Budget Office: Letter summarizing CARES Act fiscal impact, April 27 (pp. 20-21)
Politico: Dems seize on 'slush fund' to oppose Republican rescue package
Brookings: Explaining the new Fed-Treasury emergency fund
US News: Financial crisis bailouts have earned taxpayers billions
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Gigafact
Between 2020 and 2022, under close editorial supervision, Gigafact contracted a group of freelance writers and editors to test the concepts for fact briefs and provide inputs to our software development process. We call this effort Gigafact Foundry. Over the course of these two years, Gigafact Foundry writers published over 1500 fact briefs in response to claims they found online. Their important work forms the basis of Gigafact formats and editorial guidelines, and is available to the public on Gigafact.org. Readers should be aware that while there is still a lot of relevant information to be found, not all fact briefs produced by Gigafact Foundry reflect Gigafact's current methods and standards for fact briefs. If you come across any that you feel are out of date and need to be looked at with fresh eyes, don't hesitate to contact us at support@gigafact.org.
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About fact briefs published on Gigafact
Fact briefs are short, credibly sourced summaries that offer “yes/no” answers in response to claims found online. They rely on publicly available, often primary source data and documents. Fact briefs are created by contributors to Gigafact —a nonprofit project looking to expand participation in fact-checking and protect the democratic process. See all fact briefs here.