Federal COVID-19 Relief, What’s in the McConnell Plan?

After months of inaction, and with the previously enacted federal moratorium on evictions expiring TODAY July 24, the U.S. Senate still has not taken action on the HEROES Act, which the House passed in May—nor have Senate Republicans put forward their own pandemic relief and recovery package!

Even worse, media reports and sources inside the Capitol indicate that the legislative package Senate Majority Leader Mitch McConnell is preparing to introduce falls far short in scale, scope, and priorities, offering an inadequate response to the unprecedented public health and economic crisis caused by COVID-19.

Although we don’t have the full bill, lots of the components are being leaked. Remember, we won’t know exactly until we see the legislation, but here are some of the items we expect based on leaks and press reports:

  • There will be some form of extension of Pandemic Unemployment Compensation, but not at the $600/week level. Secretary of the Treasury Steven Mnuchin has described it as providing 70% wage replacement for pre-COVID pay level.
  • There is no emergency rental assistance funding and no mention of a SNAP increase.
  • There is no additional state/local aid except for the education funding listed below. States/localities will have more flexibility in the use of the $150 billion already distributed to states (does not all have to be used to respond to the pandemic—can be used to replace falling revenues). Attached outline anticipates negotiation with the House will result in more state/local aid.
  • There will be another round of direct payments ($1,200) — don’t know details of implementation.
  • No payroll tax holiday. There is an increased business meals deduction, doubling from 50% to 100%, and new deductions for business purchases of personal protective equipment like masks, gloves, and hand sanitizer. And there’d be an expanded version of an employee retention tax credit for hard hit businesses enacted in March.
  • The package will include nearly $303 billion in supplemental funding with $235 billion under the purview of the Labor-HHS-Education Appropriations Subcommittee. The breakdown is as follows: $105 billion for education; $70 billion of that would go to K-12 schools, including $30 billion for schools that physically reopen and $10 billion for private schools. An additional $29 billion would be for colleges and universities, and $5 billion would be for a flexible fund that governors could distribute.
  • $26 billion for vaccine research, distribution, and use.
  • $25 billion more for hospitals and other health care providers, bringing the total since March to $200 billion.
  • $16 billion more for COVID-19 testing, plus $9 billion previously appropriated (total of $25B).
  • $15.5 billion for National Institutes of Health research.
  • $15 billion for child care.
  • $7.6 billion for community health centers.
  • $4.5 billion for mental health, suicide prevention and overdose response programs.
  • $1.3 billion for workplace training on social distancing procedures.
  • Paycheck Protection Program: The measure would provide for a second round of forgivable Small Business Administration loans, this time limited to firms with 300 or fewer workers — down from 500 in the original March law. And eligible businesses would need to demonstrate a 50 percent revenue reduction below a comparable period pre-pandemic. Loan amounts would be capped at smaller levels, but uses would be expanded to cover supplier costs, operating expenses, and any damage caused by recent riots in the wake of George Floyd’s death at the hands of Minneapolis police. Farmers and ranchers would also receive more generous terms.
  • Trust Act: Majority Leader Mitch McConnell has announced that the TRUST Act is included in the Republican coronavirus package. The Trust Act creates a closed-door process to fast track cuts to Social Security, allegedly as a way to manage the deficit. Read more about how the TRUST Act threatens Social Security.

Tell Senators Toomey and Casey to stand up to Mitch McConnell and stand up for the needs of Pennsylvanians! Send a letter using our letter writing campaign here: https://actionnetwork.org/letters/tell-your-senators-to-stand-up-for-pennsylvania/