COVID-19 and Federal Update:
- Leader McConnell Announces Republican's Phase 4 Relief Plan--CARES 2 On Monday, Chairmen Grassley, Alexander, Collins, Rubio, Shelby, and Blunt, and Senators Cornyn and Romney will introduce each component of CARES 2/Phase 4 legislative text. Earlier this afternoon Leader McConnell laid out the solutions that they will focus on, including benefits for kids, jobs, and healthcare. Below are the highlights:
- Reopening-related funding package for schools and universities north of $100 billion. And there will be several other policies to help childcare providers, grant new flexibility to elementary and secondary schools, and more.
- Republicans want to send a second round of direct payments to American households.
- And Senator Collins and Senator Rubio have crafted a sequel to the Paycheck Protection Program. It would give the hardest-hit small businesses an opportunity to receive a second loan if they continue paying their workers.
- They also intend to continue some temporary federal supplement to unemployment insurance, while providing a fix for paying people more to remain out of the workforce.
- Lay out policies to incentivize retention, encourage rehiring of laid-off Americans, and help businesses obtain PPE, testing, and supplies to protect their employees and entice customers.
- Looking to the long term, the COVID-19 crisis has weakened the critical federal trust funds that Americans rely on. So, as Senator Romney will explain, the proposal includes a bipartisan bill, co-sponsored by Senate Democrats, to help a future Congress evaluate bipartisan proposals for protecting and strengthening the programs that Americans count on.
- CARES 2 will continue to treat the root causes of this medical crisis. More resources for hospitals and healthcare workers. More help to keep sprinting towards diagnostics, treatments, and vaccines. New policies to shield seniors from a spike in Medicare premiums.
- There is one more essential element that ties schools, jobs, and healthcare all together: Legal protections to prevent our historic recovery efforts from simply lining the pockets of trial lawyers. Senate R’s will work to make sure that nurses and doctors who provided throughout the response, are not swamped by a tidal wave of malpractice suits. And they will include language to ensure school districts, colleges, churches, nonprofits, and employers that obey official guidance do not have to delay reopening because they’re afraid they’ll spend 10 years in court.
Again, Senate Republicans view this proposal as opening of negotiations and changes are anticipated. Please let us know if you have any questions.
- HILL TAX BRIEFING: GOP Pandemic Aid Proposal Not Ready Yet Lawmakers are crunched for time to craft the next pandemic response package, as differences between Senate Republicans and the White House slowed a formal rollout, despite what Senate Majority Leader Mitch McConnell called, “an agreement in principle,” on the Senate floor late Thursday. The GOP relief package won’t come out until Monday, said Senate Finance Chairman Chuck Grassley (R-Iowa), who is helping to write part of it. The unemployment portion of the package remains unsettled, with both sides looking to provide a lesser version of the $600 per week subsidy included in the first CARES Act, due to concerns that out-of-work employees might be dissuaded from returning to jobs that would pay them less. One idea gaining traction among Senate Republicans: replacing 70% of prior wages, which is significantly less than the weekly $600 subsidy to state unemployment but still above default state unemployment payments. Democrats so far have insisted on a continuation at current levels of the emergency provision, which expires after July 31. Mnuchin and White House Chief of Staff Mark Meadows spent most of the week trying to put a White House stamp on the Senate Republican proposal, with little success. Yesterday began with a decision to drop President Donald Trump’s desired payroll tax holiday. Trump, who previously said he would reject any stimulus bill that didn’t include a payroll tax break, blamed Democrats for the GOP’s decision to skip it. House Speaker Nancy Pelosi (D-Calif.) and Senate Minority Leader Chuck Schumer (D-N.Y.), said no negotiations would begin without a fleshed-out proposal from Republicans.
- Direct Payments: Republicans are backing $1,200 checks for individuals who make up to $75,000 a year and $500 for their dependent children. Direct payments would inject money into the economy faster than a payroll tax cut, which would likely take weeks to carry out and provide a modest boost only to people with jobs, Mnuchin said.
- The proposal is expected to allow a $500 rebate per dependent for taxpayers who qualify for a payment, Colin Wilhelm reports. The prior round of payments only allowed the additional rebate for dependents aged 17 or under.
- Senate Passes Payment Bill: The Senate on Thursday unanimously passed a bill (S. 3841) intended to prevent the recovery payments authorized in the CARES Act from being garnished by private debt collectors.
- Industry-Focused Requests for Aid
- The negotiations process has spurred industry groups and lawmakers to call out for the addition of specific benefits. Here are some of the latest requests:
- Unclaimed Credits: Brian Johnson, executive director of The Recovery Coalition, backed bicameral legislation introduced by Sen. John Cornyn (R-Texas) and Rep. Jodey Arrington (R-Texas) that would let businesses immediately monetize unclaimed general business credits. The Recovery Coalition describes itself as a group of businesses and associations backing pro-growth tax policy.
- Next PPP Proposal: Senate Small Business Committee Chairman Marco Rubio (R-Fla.) said in a tweet that he would soon release plans for a second round of loans intended only for businesses that have less than 300 employees and have lost at least 50% of revenue. Read the full article at Bloomberg Government
- Senate Republicans to pitch second wave of small business loans Senate Republicans on Thursday are set to unveil plans to extend financial support to struggling small businesses that are facing new pressure as the coronavirus outbreak surges across the country. As part of an economic relief deal negotiated by GOP lawmakers and the White House, the plan is expected to allow certain employers that received Paycheck Protection Program loans to apply for a second round of aid if they can demonstrate a 50 percent revenue loss, according to policymakers involved in the talks. The government-backed loans, which Congress created in March to avert layoffs during the pandemic, can be forgiven if employers agree to maintain their payroll. Senate Small Business Chair Marco Rubio (R-Fla.), who has been crafting the plan, said on Twitter that he planned to present his proposal Thursday.
- A new wave of small business relief is just one aspect of a sweeping economic relief plan that Senate Republicans were expected to unveil Thursday. Lawmakers are looking to keep the PPP alive after it delivered more than half a trillion dollars in aid to 4.9 million borrowers. Other proposals that are expected to appear in the new small business aid proposal include a streamlined loan forgiveness process for the PPP loans. Lawmakers have also been discussing new types of government-backed loans that could provide longer-term capital to businesses hit by the pandemic. Rubio said on Twitter that his plan would be targeted at employers with 300 workers or less and those in low-income neighborhoods. He said it would also allow business expenses on personal protective equipment and other Covid-19 prevention measures to count toward the forgivable portion of the PPP loans.
- Earlier this week, Senate Majority Leader Mitch McConnell described it as a "targeted second round" of the PPP.
- In addition to navigating bipartisan negotiations to make the plan law, one hurdle lawmakers will face in crafting the plan is reticence on the part of lenders tasked with delivering the government-guaranteed loans. Banks have warned lawmakers about making the loan process more complicated than it already is and creating terms for new loans that would be unpalatable for lenders that are putting their own capital on the line to issue the government-guaranteed aid. A top priority for lenders is slashing the paperwork that borrowers will have to submit to have the smallest loans converted into grants. Read the full article at Politico
- White House, GOP Kill Payroll Tax Cut But Flounder Over Broader Coronavirus Bill Senate Republicans killed President Trump’s payroll tax cut proposal on Thursday but failed to reach agreement with the White House on a broader coronavirus relief bill. This set off a frantic scramble with competing paths forward, as administration officials floated a piecemeal approach but encountered pushback from both parties, and the entire effort appeared to teeter chaotically on the brink of failure. Senate Majority Leader Mitch McConnell (R-Ky.) had planned to roll out a $1 trillion GOP bill Thursday morning but that was canceled in a head-spinning series of events. Read More at The Washington Post
BUDGET AND APPROPRIATIONS NEWS
- GOP Set To Unveil Package 'Next Week' After $600 Weekly Unemployment Boost Expires Sen. Mitch McConnell will not unveil the GOP coronavirus relief bill Thursday, ABC News has learned. After a closed-door meeting, Sen. Deb Fischer, R-Neb, told reporters to expect the package on Monday, but others would only commit to "next week." McConnell's office had no comment. This means the bill will be unveiled after the $600 weekly unemployment benefit boost expires. The White House reluctantly dropped its bid to cut Social Security payroll taxes Thursday as Republicans unveil a $1 trillion COVID-19 rescue package, yielding to opposition to the idea among top Senate allies. Read More at ABC13
- Trump Cancels Jacksonville Portion Of Republican Convention Planned For August Due To COVID President Donald Trump announced Thursday he is canceling the Jacksonville portion of the Republican National Convention that had been planned next month because of the coronavirus pandemic, a major setback in his effort to energize his struggling bid for reelection. "The timing for this event is not right," Trump told reporters at the White House during his latest briefing on the virus. "There's nothing more important than keeping our people safe." Trump said that he would deliver remarks to formally accept his party's nomination for president but offered no details on where or when that would happen. The move was not only a significant blow to his campaign but also appeared to undermine the president's narrative that the country is ready to reopen for business. Read More at USA Today