GOP Lawmakers Unveil Virus Aid Plan, Setting Up Negotiations With Democrats

Chris Gaetano
Published Date:
Jul 28, 2020
Republican senators have introduced their version of the latest round of coronavirus aid, setting up negotiations with House Democrats, which passed their own, very different, bill months ago.

Though touted as the singular Health, Economic Assistance, Liability, and Schools (HEALS) Act , the proposal comes in the form of several separate bills that theoretically could be approved or denied piecemeal.

The many features of the proposal include:

Making it so that the federal unemployment insurance supplement is limited to 70 percent of someone's previous income, as opposed to the flat $600 supplement that was in the CARES Act. State governments will have two months to figure out how exactly they will calculate this and, until then, the benefit will be a flat $200;

* A second round of direct $1,200 payments, structured in pretty much the same way as the previous round (e.g., a tapering off for those of $75,000 annual income or more, an extra $500 per child, $6,000 household limit, etc.); 

* $105 billion in aid to schools; two-thirds of which will go only to schools that institute reopening plans, with the remainder going to schools generally; 

* The ability for student borrowers, once they resume payments in October, to pay only 10 percent of their gross adjusted income (with lesser benefits for higher-income borrowers);

* Broad liability protections against pandemic-related lawsuits. Individuals or entities would  be found liable for virus exposure only if they did not make "reasonable efforts in light of all the circumstances to comply with the applicable government standards and guidance in effect at the time of the actual, alleged, feared, or potential for exposure to the coronavirus"; if they engaged in "gross negligence or willful misconduct" in causing "an actual exposure to coronavirus"; and if "the actual exposure caused the personal injury of the plaintiff." This liability shield extends from Dec. 1, 2019 to Oct. 1, 2024.

* Further extending the life of the Paycheck Protection Program (PPP) and topping it up with an additional $257 billion ($100 billion for general loans, $57 billion for recovery sector loans, and $100 billion for small business investment companies);

$16 billion for testing, contact tracing, surveillance, containment and mitigation;

Excepting restaurant meals paid for or incurred before Jan. 1, 2021, from the general rules on expensing meals;

Increasing the employee retention tax credit from 50 percent to 65 percent and upping the annual limit of $10,000 to $30,000 annually and no more than $10,000 in any fiscal quarter. It also expands the pool of eligible employers for this credit;

Increasing the size of the work opportunity tax credit from 40 to 50 percent of qualified wages in the case of those hiring workers who had previously been unemployed due to COVID-19;

* A new employment tax credit equal to the sum of pandemic-related protection expenses, workplace reconfiguration expenses, and workplace technology expenses;

* Establishment of "rescue committees" for federal government trusts such as Social Security;

Restricting government purchases of personal protective equipment to products made in the United States, paired with a 30 percent investment tax credit for those who invest in the production of personal protective equipment in the United States.

* $1.75 billion for the construction of a new FBI headquarters.

The Republican plan is only a starting bid, as the Republicans must now engage in negotiations with Congressional Democrats. Their own HEROES Act, which passed the House in May, contains significant differences from the GOP's package. The New York Times noted that Democrats want to extend the flat $600 supplemental unemployment benefit through January; OSHA standards for virus protection rather than a broad liability shield; $1 trillion in aid for state and local governments; and unconditional aid to schools rather than making it contingent on reopening.

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