We’re now many months into the COVID-19 pandemic and the fate of the U.S. economy remains largely uncertain, with unemployment remaining in double digits and many businesses still struggling to survive. The federal government is expected to formulate a new stimulus bill in the coming weeks to help get the economy back on track. To this end, Senate Majority Leader Mitch McConnell has indicated that the GOP will propose a new $1 trillion-plus stimulus bill, which he has described as “a starting place” for negotiation, in the next several days. Meanwhile, the House proposed a $3 trillion stimulus bill (called the “Heroes Act”) in May 2020. Treasury Secretary Steve Mnuchin and Speaker of the House Nancy Pelosi both have said that they want agreement on the legislation by the end of next week, although McConnell seemed to think that would be unlikely.
The precise details of the ultimate stimulus bill remain to be seen, but the legislation is expected to touch on the following elements:
The Trump administration originally asked for two direct payments to qualifying individuals and families in March 2020, although we’ve so far only seen one such payment. This new stimulus bill may provide another direct payment, although the structure may be different. The first set of stimulus checks went (in varying amounts) to people earning less than $99,000 per year, with the full $1,200 going to anyone earning less than $75,000. The new round of direct checks may be concentrated even more in lower earners, with McConnell being quoted as in favor of a $40,000 threshold.
This is likely to be more limited than the original program, and may be applied only to those businesses that have been the hardest hit by the crisis. One potential limit would be to businesses with under 300 employees that can demonstrate significant revenue declines.
Money for Schools
The bill is expected to include $105 billion for education.
Money for Testing, Vaccines and Health Care Providers
With the United States behind in testing capabilities and support for health care, this is likely to be in the stimulus bill.
Other areas that may be covered by the stimulus bill include unemployment insurance (since the $600 federal unemployment enhancement expires on July 31, 2020); a payroll tax cut, as promoted by the Trump administration; liability protections for businesses, schools, health care providers and workers and non-profits; and tax incentives for hiring and retaining workers and for re-opened businesses for PPE and retrofitting.
We will provide updates on the status of the federal government’s consideration of additional stimulus legislation, so please stay tuned to our alerts. If you have any questions about federal programs providing support to individuals and businesses in light of the COVID-19 pandemic, please reach out to Cary Zimmerman at email@example.com or 216.735.7275.