This week, Senate Leader Mitch McConnell unveiled a framework for a fourth federal coronavirus package – the Health, Economic Assistance, Liability Protection and Schools Act (HEALS). As with everything in Washington, this is simply the beginning of the negotiations between Republicans and Democrats on the Hill. While the framework still has a long way to go before it becomes law, it is worth paying close attention.
Economic Impact Payments
This would be the second round of economic impacts payments to Americans. In the framework, the structure would be nearly identical to the first payment:
- $1,200 for single taxpayers earning $75,000 or below
- $2,400 for married taxpayers filing jointly earning $150,000 or below
- $500 for eligible dependents
In the CARES act, the federal government had a $600 per week payment to those unemployed. However, that benefit expired on July 25th. This proposal would provide a $200 per week benefit through September. Beginning in October, this would be replaced with a payment that replaces 70 percent of an individuals lost wages when combined with state unemployment insurance compensation, up to $500 per week. This section would also provide $2 billion to states to assist with upgrading their unemployment insurance systems to comply with the formula and any additional surges in unemployment.
Paycheck Protection Program
The HEALS act would appropriate an additional $190 billion to support a second round of loans to companies. These second PPP loans would only be permitted for companies under 300 employees and have experienced at least a 50 percent reduction in gross revenues. This second loan would allow companies to borrow 2.5 times monthly payroll expenses up to $2 million. The HEALS act would also expand eligibility for the program to 501C6 organizations.
The HEALS act would provide protections to businesses, non-profits, educational institutions, healthcare providers, and local governments against lawsuits brought against them related to COVID-19 exposure. Gross negligence would still be subject to legal claims.
State and Local
The HEALS act would grant flexibilities to state and local governments on spending CARES act funds. It would push back the deadline of spending those funds to 90 days after the end of a state or local governments 2021 fiscal year. It would also provide the flexibility to plug revenue shortfalls in fiscal year 2020 or 2021 but has a limit of 25 percent and cannot be used to replenish rainy day funds or pension benefits.
Coronavirus and Schools
The HEALS act would appropriate $306 billion in emergency aid for the coronavirus response efforts, including $105 billion to help students returning to school this fall.
Posted by: Joe Bost, Senior Vice President, Government Affairs @ 12:00:00 am