Summary Details

15

BPAA Federal Policy Update - December 14, 2020

posted on

COVID-19 Relief & Budget Update

 

  • Bipartisan group unveils two-part $908 billion coronavirus package: A bipartisan group of lawmakers on Monday unveiled its $908 billion coronavirus relief package as Congress faces a time crunch to pass more aid.  
    • The proposal is split into two bills: 
      • One $748 billion piece includes another round of Paycheck Protection Program assistance for small businesses, support for unemployment benefits, and more money for schools, vaccine distribution and other widely agreed-upon items. 
      • The second $160 billion piece ties together the two most controversial elements of the coronavirus negotiations: more money for state and local governments and protections for businesses from coronavirus-related lawsuits. 
    • Splitting off the two issues could make it easier to convince congressional leaders to take up a smaller coronavirus deal and either pass it or add it to a must-pass government funding deal, with a deadline of Friday.
    • Paycheck Protection Program & Small Business Support
      • $300 billion to Small Business Administration
      • Funding to allow to allow the hardest-hit small businesses to receive a second forgivable Paycheck Protection Program (PPP) loan.
      • Eligibility would be limited to small businesses with 300 or fewer employees that have sustained a 30 percent revenue loss in any quarter of 2020.
      • Small 501(c)(6) organizations that are not lobbying organizations and that have 150 employees or fewer, such as local chambers of commerce, economic development organizations, and tourism offices, would become eligible for PPP.
      • Forgivable expenses are expanded to include supplier costs and investments in facility modifications and personal protective equipment to operate safely.
      • Business expenses paid for with the proceeds of PPP loans are tax deductible, consistent with Congressional intent in the CARES Act.
      • Loan forgiveness process is simplified for borrowers with PPP loans of $150,000 or less.
      • Set-asides are included to ensure that smaller borrowers and underserved communities get the help they need, such as: for small businesses with 10 or fewer employees; for loans made by small community lenders, including Community Development Financial Institutions (CDFIs), credit unions, small community banks, Minority Depository Institutions (MDIs), and farm service lenders; and for the Minority Business Development Agency.
      • Funding for independent live venue operators, including eligible independent movie theatres and museums, affected by COVID-19 stay-at-home orders.
      • Extension of Section 1112 of the CARES Act, which provides payment of principal, interest, and associated fees on qualifying Small Business Administration (SBA) 7(a), 504 and microloans.
      • Funding for SBA loan products to increase guarantees on SBA 7(a) loans and reduce fees on 7(a) and 504 loans; provide loan subsidies for 7(a) loans; and provide Economic Injury Disaster Loan grant advances.
      • Includes re-purposing of $138 billion in unspent allocations to be reinvested in the PPP program

 

  • Omnibus Deal Near, Could be Filed Tomorrow House lawmakers plan to file 12-part omnibus spending legislation as soon as tomorrow, according to a person familiar with the plan. These appropriations bills are needed to keep the government open after current funding runs out Dec. 18.
    • Speaker Nancy Pelosi (D-Calif.) and Senate Majority Leader Mitch McConnell (R-Ky.) are both aiming to combine the omnibus funding measure and a coronavirus aid package into one bill.

 

  • The Untapped Pandemic Aid Funds in Transition Limbo The U.S. government’s central economic response to the coronavirus, the $2.2 trillion Coronavirus Aid, Relief, and Economic Security (“Cares”) Act enacted in March, included $500 billion in financing to avert a crippling credit crunch. Much of that funding remains untapped, and what happens to it going forward is a point of contention between the outgoing Trump administration and the incoming Biden one. Read More at Bloomberg

 

  • Jumping the line for a vaccine will be pretty easy After the first round of coronavirus vaccines is administered, state and local officials largely will not be able to ensure that the rest of the process puts high-risk people first.
    • Between the lines: Experts have spent months debating the ins and outs of a complex prioritization system for these vaccines, all in the hopes of saving as many lives as possible. But the actual process will likely rely heavily on the honor system.
    • The big picture: It’ll be relatively easy to ensure that the highest-priority groups — health care workers and nursing-home residents — are the ones who actually receive the first vaccine doses, because hospitals and long-term care facilities can just go through their staff and resident rosters to figure out who should be offered a vaccine.
      • “Right now we’re very much focused on getting it to the hospitals and the nursing homes, and they’ll be what we call a closed point of distribution,” said Bryan Mroz, Acting Assistant Secretary of the Maryland Department of Health.
      • But after that, enforcement gets harder. Experts have said the next round of doses should be focused on people who are most at risk to catch or spread the virus, or for serious illness. That would include many service workers and people with underlying health conditions. Read more at Axios.


Election & Transition Update

 

  • Biden Wins Electoral College to Cement Victory and Rebuff Trump Joe Biden officially clinched the presidency after the Electoral College confirmed his victory Monday, capping a tumultuous period sparked by Donald Trump’s refusal to acknowledge he lost with the help of Republicans willing to support his unsubstantiated claims.
    • Some Senate Republicans who had refused to recognize Biden’s overwhelming victory quickly started acknowledging that Trump lost and Biden will be inaugurated as the 46th president on Jan. 20.
    • The 55 votes from California electors put Biden over the 270 needed to win. Electors in all 50 U.S. states and the District of Columbia cast their ballots for president and vice president in time-honored constitutional ceremonies that took on new importance after Trump insisted without evidence that the election was “rigged.” Congress will officially count the electoral votes on Jan. 6. But many Republicans haven’t publicly acknowledged Biden’s certified victory and the court rulings rejecting challenges to the results, saying Trump had a right to let the process play out. And now it has.
    • Republican Senator John Cornyn of Texas said it would be a “bad mistake” to object to electors in Congress, calling any such move “futile and unnecessary.” “I believe that we’ll see the page turning on January 20th,” he said. “We’ll have a peaceful transition. Asked whether Biden is the president-elect, Republican Senator Shelley Moore Capito of West Virginia told reporters, “it certainly looks that way, and I think it’s time to turn the page and being a new administration.”
    • Republican Senator Chuck Grassley of Iowa said he doesn’t have to acknowledge that Biden has won, saying “the Constitution does that.” Story from Bloomberg Government.

 

  • Progressives frustrated with representation as Biden Cabinet takes shape: Some progressives are getting increasingly frustrated with the how President-elect Joe Biden’s potential Cabinet is shaping up, venting that the incoming administration does not properly reflect the role progressives played helping Biden get to the White House.
    • Liberal groups and lawmakers bristled at Rep. Marcia Fudge (D-Ohio) getting passed over for Agriculture secretary in favor of Tom Vilsack, who held the role in the Obama administration. 
    • And there is growing concern the Biden team will pass over Rep. Deb Haaland (D-N.M.), a progressive favorite, for Interior secretary.
    • While Biden’s choices so far have largely succeeded in not upsetting the Democratic base, there is bubbling skepticism among progressive groups that Biden will commit to including picks for top Cabinet positions that will represent their views.
    • “I think the Biden people have been a little bit less concerned about satisfying progressives. I think they’re a little more concerned about not alienating progressives,” said one Democratic strategist close to the transition. The Hill’s Brett Samuels and Alex Gangitano explain here.

 

  • How Biden aims to Covid-proof his administration Small and infrequent public events. Repeated testing of staff, reporters and the president-elect. Aides debating policies and Cabinet picks without ever meeting face-to-face. Preparations for a pared-down, mostly virtual inauguration. Joe Biden’s team has meticulously carried the virus safety practices of his campaign over to the transition. And his staff plans to take that approach to the White House on move-in day — intent on setting a good example for the country and avoiding the dangerous and embarrassing outbreaks of Covid-19 that have infected dozens in President Donald Trump’s inner circle, most recently sickening his personal lawyer, Rudy Giuliani. “It’s a dynamic situation with the pandemic, but I think you’ll see the exact same adherence to and commitment to the science of keeping the team safe that you saw during the campaign and transition, you’ll see that as we enter the physical space,” said Yohannes Abraham, the executive director of the transition. The grim reality of the country's recent surge of cases is shaping Biden’s plans for the first days of his administration and how he plans to run his White House. The team only plans to have a skeleton staff working on campus at first, with most continuing to work remotely from home. They also plan to have the building — which has seen numerous virus outbreaks among staffers and top officials this year— meticulously sanitized. Read more at Politico.

 

Tax Policy Update

  • Tax Relief Not a Big Part of Virus Aid Plan A $908 billion framework introduced by a bipartisan group of eight senators would expand on some of the key components of March’s CARES Act, providing a second round of Paycheck Protection Program small business loans and a temporary unemployment benefit supplement. But one place the proposal differs from March’s massive relief package (Public Law 116-136) is that it relies much less heavily on tax relief. The CARES Act included a number of tax changes designed to help businesses and individuals, including a fix to the 2017 tax law’s “retail glitch” and temporary changes to the tax treatment of losses and business interest. In contrast, the new proposal doesn’t have much tax in it, with the notable exception of language that would allow businesses that received PPP loans to deduct business expenses that ended up being covered by that loan or grant money. Read More at Bloomberg

 

  • Several Tax Provisions Set To Expire At End Of 2020 During a busy and historic year — with a global pandemic, disruptions to the economy, and postponements of normal tax deadlines — practitioners may have missed that many tax provisions are scheduled to expire at the end of the year. And while the annual expiration of tax provisions has become common, in most years Congress by December has at least considered legislation to extend some or all of them. This year is different, with no hint that Congress is prepared to take up extender legislation in the last few days of the year. While many of the expiring provisions provide targeted incentives or do not affect many taxpayers, some affect many individuals or businesses, including the work opportunity credit; the exclusion from gross income of discharge of indebtedness on a principal residence; the 7.5% adjusted-gross-income (AGI) floor for medical expense deductions; and the deduction for qualified tuition and related expenses. Read More at The Tax Advisor

 

Labor & OSHA Update

  • Unemployment Assistance In Bipartisan Bill A bipartisan group of lawmakers on Monday unveiled its $908 billion coronavirus relief package as Congress faces a time crunch to pass more aid.  One $748 billion piece includes another round of Paycheck Protection Program assistance for small businesses, support for unemployment benefits, and more money for schools, vaccine distribution and other widely agreed-upon items. The breakdown is:
    • Extension of all pandemic unemployment insurance programs by 16 weeks, including PUA and PEUC, from their expiration at the end of December;
    • Ensure beneficiaries of Railroad Retirement Board received the same benefits as other workers;
    • Federal supplemental unemployment insurance benefits expanded by $300 per week for 16 weeks, from the end of December into April 2021;
    • $1 billion for state systems for technology modernization and fraud prevention
    • Small administrative adjustments, e.g. to certification requirements and overpayment standards.

 

  • Stimulus checks should take back seat to jobless aid, economists say A bipartisan push to include stimulus checks in the next COVID-19 relief package is raising concerns among economists that other forms of relief considered more effective may be left out. Direct payments in the form of $600 or $1,200 checks are undoubtedly popular with most Americans, economists say, but targeted funds for unemployed workers would do more for the economy since those households are less likely to put the money into savings. “They’re a decent stimulus. They’re far from the best stimulus out there,” said Marc Goldwein, head of policy at the Committee for a Responsible Federal Budget. Read more at The Hill.

 

  • U.S. Jobless Claims Jump to Three-Month High Amid New Shutdowns Applications for U.S. unemployment benefits surged last week, topping estimates with the highest level since September, suggesting that widening business shutdowns to curb the pandemic are spurring fresh job losses. Initial jobless claims in regular state programs rose by 137,000 to 853,000 in the week ended Dec. 5, Labor Department data showed Thursday. On an unadjusted basis, the figure increased by almost 229,000. The prior week included Thanksgiving, and data tend to be volatile around holidays. Continuing claims, which reflect Americans on ongoing unemployment benefits, jumped by 230,000 to 5.76 million in the week ended Nov. 28. It was the first increase since August. The claims reading topped all but one estimate in a Bloomberg survey of economists that had called for 725,000 initial claims and 5.21 million continuing claims, on an adjusted basis. Read More at Bloomberg
| Categories: Federal Policy | Tags: | View Count: (578) | Return