Congress Close to a Deal on New Stimulus Package - Here's What to Expect


After months of back and forth between the Democratic-controlled House of Representatives and the GOP-held Senate, we may finally have an answer on when we might see another coronavirus relief stimulus package amid a struggling economy that has seen more than 30 million people out of work since May.

On Wednesday, Senate GOP leaders, including the chair of the Appropriations Committee Sens. Richard Shelby, (R-AL), the chair of the Health, Education, Labor and Pensions Committee Lamar Alexander (R-TN), and the chair of the Rules Committee Roy Blunt (R-Mo) said they had reached a "fundamental agreement" with the White House on how to proceed with another coronavirus stimulus relief bill.

There's still debate on what will be included in the bill itself as the legislation remains fluid. However, Senate Majority Leader Mitch McConnell (R-Ky) has previously stated that he wanted to keep the bill's price tag at around $1 trillion, even as other Republicans denounce the massive spending bills amid a soaring national debt.

The new proposal completely discards the $3.4 trillion HEROES Act passed by the House in April which contained several items derided by Republicans as a Democratic pie-in-the-sky wishlist. Among the items proposed by Democrats were a $4,000 'vacation tax credit', a $2,000 monthly family check among other items that had little hope of getting through the GOP-controlled Senate.

Senator Roy Blunt told reporters that the Republican plan is not one bill, but rather a "handful of bills now."

"So we'll have one appropriations bill, we'll have several authorization bills that explain in more detail how that appropriated money will be spent, and obviously there will be a bill that will talk about any money that is distributed in direct payments or any other way," he said.

However, Democratic leaders appear unimpressed with what they've seen of the Republican plan, calling it an "unserious" proposal unlikely to pass.

"What we have seen so far falls very short of the challenge that we face in order to defeat the virus, and in order to open our schools and open our economy," House Speaker Nancy Pelosi, D-Calif., said Thursday. "We have to act. And what they're proposing falls far short."

Stimulus Checks

First the good news: Treasury Secretary Steven Mnuchin said Wednesday the White House has made an agreement with congressional leaders to provide Americans with another round of direct payments - however, it's still unclear who would be eligible to receive the checks or how much they might be.

When Mnuchin was asked whether they'd reached an agreement on how much the checks might be, the Treasury Secretary demurred, saying "I'm not going to get into specifics right now, but there is an agreement."

Earlier this year, Congress approved the CARES Act, which contained a one-time $1,200 payment for all Americans who made under $70,000 in 2019.

Unemployment Insurance Extension

With around 1.4 million people filing for first-time unemployment benefits last week, the issue of extending unemployment insurance benefits - including the $600-a-week federal payment for jobless Americans that's due to end by the end of the month - has become one of the more controversial aspects of any new relief legislation.

Republicans have been open to the idea of a short-term extension, as the number of coronavirus cases continues to surge in many states, however the White House does not appear to welcome the idea.

"We're really looking at trying to make sure that we have a comprehensive bill that deals with the issues," President Trump's Chief of Staff Mark Meadows told NBC News. "Any short-term extensions would defy the history of Congress, which would indicate that it would just be met with another short-term extension."

Instead, Trump has floated the idea of a payroll tax cut, which has been a top priority for his administration, something top Republicans have already dismissed from any future stimulus package.

"We really are not in a position to talk any specifics," Meadows said. "We're going let Leader McConnell talk about that after he actually has a more thorough conversation with his senators."

Payroll Tax Cut

Despite President Trump's insistence that any new coronavirus relief bill must contain a payroll tax cut, GOP leaders said Wednesday it won't be included in the new relief bill.

Testing

Another point of contention between House Democrats and the Senate GOP and White House is the amount of money that will be dedicated to testing for COVID-19. The Republican proposal currently contains $16 billion for testing, with another $9 billion in previously appropriated funds. The combination of funds is a compromise with the White House, who wanted to zero out the funding for testing and Senate Republicans, who wanted $25 billion.

The funding will be directed toward testing in schools, day care centers, nursing homes and senior centers.

"I think it's helpful to get down to what we were really talking about — a sense of the pre-eminent federal responsibility would be on the testing front and more clearly defining the $9 billion that had been set aside earlier that would absolutely be testing money, along with $16 billion that we add to that," Blunt told reporters.

Schools

Up to $70 billion of the new stimulus relief bill would be directed toward K-12 education for all schools on a per-capita basis. Half of the funds would be directed toward covering costs for schools that have reopened, while $30 billion would be given to colleges and universities. Another $5 billion would be given to governors for them to distribute as they see fit.

"We've agreed on the school front on ways to get people back to school and encourage them to go back to ... school, as much as possible," Blunt said. "We'll have some money that will be distributed to all districts and other money distributed [to] districts that get back to school in a more traditional sense."

Senate Majority Leader Mitch McConnell said Tuesday that Republicans are prepared to spend $105 billion so that schools can safely reopen. Democrats have called for more than $400 billion in school funding.

Photo: Getty Images


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