COVID-19 STIMULUS PACKAGES SUMMARY
–updated May 18, 2020
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The Coronavirus Aid, Relief, and Economic Security Act (CARES) is a bill that responds to the COVID-19 outbreak, and its impact on the economy, public health, state and local governments, individuals, and businesses. The bill was presented to the President on March 27th, 2020 and signed into law that day, becoming P.L. 116-136. Click HERE to view the final bill. This is commonly known as “Phase 3” of the Coronavirus relief legislation.
At the heart of the bill, the CARES Act provides FY 2020 supplemental appropriations for federal agencies to respond to the COVID-19 outbreak. The supplemental appropriations are designated as emergency spending, which is exempt from discretionary spending limits. The bill temporarily expands unemployment benefits, provides tax rebates to American citizens, suspends payments and interest to student loans. A substantial part of the deals with the funding of “…various loans, grants, and other forms of assistance for businesses, industries, states, local governments, and hospitals”.
Health Sciences was a key aspect of the CARES Act, as this bill attempts to address the issues surrounding COVID-19. The Centers for Disease Control (CDC) was appropriated a total of $4.3 billion for CDC-Wide Activities and Program Support. The Food and Drug Administration was appropriated $80 Million for salaries and expenses to respond to COVID-19. A total of $909.4 million was appropriated to National Institutes of Health (NIH) in the CARES Act. $706 million for the National Institute of Allergy and Infectious Diseases (NIAID); $103.4 million for the National Heart, Lung, and Blood Institute (NHLBI); $60 million for the National Institute of Biomedical Imaging and Bioengineering (NIBIB); $36 million for the National Center for Advancing Translational Sciences (NCATS); $30 million for the Office of the Director (OD); and $10 million for the National Library of Medicine (NLM).
Nonprofit organizations are also addressed in this bill, which is of special interest to many of our advocates who are leaders in their organizations. The issues that the CARES Act addresses with regards to nonprofits are employee retention credit, deferral of payroll taxes, SBA Loans and loan forgiveness. Eligibility guidelines, application deadlines and amounts allocated for these nonprofits are based on the size of the organization…Individual nonprofits, Small nonprofits (fewer than 500 employees), and Large nonprofits (More than 500 employees).
The CARES Act is the largest economic relief bill in U.S. History, with a total of $2.2 trillion being allocated to support individuals, business, and organizations. A bill of this complexity and magnitude demands a certain level of understanding. Independent Sector, a coalition organization that works on federal policy issues that affect nonprofits; Washington Council Ernst & Young, a DC-based lobbying firm; and Sheppard Mullin, a highly regarded law firm with a nonprofit practice, created an online resource to help 501c (3) organizations navigate the enormity that is the CARES Act. The resource includes information tailored to self-employed individuals, small nonprofits and large nonprofits, and frequently asked questions on the bill. Click HERE for Independent Sector’s CARES Act Nonprofit Resource page.
Previous Relief Packages
Prior to the CARES Act, there were two key pieces of legislation that were coronavirus relief supplemental packages, referred to as “Phase 1” and “Phase 2”. “Phase 1” is the Coronavirus Preparedness and Response Supplemental Appropriations Act of 2020…H.R. 6074 introduced by House Appropriations Committee Chairwoman Nita Lowey. The bill was presented to President Trump and signed into law on March 6, 2020. Click HERE to view the final bill. This bill provides $8.3 billion in emergency funding, with a large bulk of the money appropriated going to the U.S. Department of Health and Human Services with the primary objective to research COVID-19 and to develop a vaccine. The Office of the Secretary-Public Health and Social Services Emergency Fund received $3.1 billion, the Centers for Disease Control received $2.2 billion, the National Institutes of Health, specifically the National Institute of Allergy and Infection Diseases received $836 million, and the Food and Drug Administration received $61 million. The Small Business Administration and the U.S. Department of State also received funding in this bill.
“Phase 2” is the Families First Coronavirus Response Act…H.R. 6201, also sponsored by House Appropriations Committee Chairwoman Nita Lowey. The bill was presented to President Trump and signed into law on March 13, 2020. Click HERE to view the final bill. In response to COVID-19, this bill provided $100 billion for paid sick leave, tax credits, free COVID-19 testing; expanding food assistance and unemployment benefits; and increasing Medicaid funding. The Department of Health and Human Services received a total of $1.3 billion for Aging and Disability Services, Indian Health Services, and the Public Health and Social Services Emergency Fund; $1 billion for the U.S. Department of Labor to supplement the states for unemployment insurance; the U.S. Department of Agriculture received a total $900 million for WIC and Commodity Assistance Programs; $82 million for the U.S. Department of Defense, specifically the Defense Health Program; $60 million for the U.S Department of Veterans Affairs; and $15 million for the U.S. Department of Treasury. Other monies allocated will be granted as needed.
“Phase 3.5” was passed by the Senate by unanimous consent on Tuesday, April 21st. Phase 3.5 totals $484 billion, and it being appropriated to fund the Paycheck Protection Program (PPP) through the Small Business Administration, economic injury disaster loans and emergency grants under the CARES Act, additional support for hospitals, and provider recovery and testing. The funding breakdown is: 1) PPP-$320 billion ($60 billion of which is set aside for small lenders and community financial institutions), 2) Hospitals-$75 billion, 3) Economic Injury Disaster Loans and Emergency Grants-$50 billion, and 4) COVID-19 Testing-$25 billion.
Also included in Phase 3.5, are appropriations for health science agencies. A total of $1.8 billion has been appropriated to the National Institutes of Health (NIH). It was divided among the Office of the Director-$1 billion, the National Institute of Biomedical Imaging and Bioengineering-$500 million, and the National Cancer Institute-$306 million; $1 billion has been appropriated to the Centers for Disease Control (CDC) for “…surveillance, epidemiology, laboratory capacity expansion, contact tracing, public health data…”, etc.; and $22 million to the Food and Drug Administration “…to support activities associated with diagnostic, serological, antigen, and other tests, and related administrative activities.”
The primary reason for a Phase 3.5 was the need for more funding in the PPP after the money allocated in the CARES Act ran out within two weeks of passage. On Thursday, April 23rd, the House voted on and overwhelmingly passed Phase 3.5 (388 Yeas/5 Nays/1 Present). President Trump signed the bill into law on April 24, 2020.
Phase 4” legislation is now being proposed for an equally sized (possibly larger) stimulus package as the initial CARES Act stimulus package passed in late-March. This next package was to address funding to state and local governments, election security, infrastructure, hazard pay for essential workers (doctors, nurses, grocery store clerks, etc.), funding for the U.S. Postal Service, and other items to be determined. Reps. DeGette (D-CO) and Upton (R-MI) have also sent a “Dear Colleague” letter to their fellow House members, urging congressional leaders to support $26 billion in funding for medical and scientific research in this next package. Although Democratic leadership in the House and Senate are pushing for a new stimulus package, some Members of Congress are concerned about such spending and its effects on the national debt. Also, there are some Members, primarily Republican Members of the Senate, who want to increase funding for some programs, and decrease funding for others, in order for a package to gain Republican support and passage in the Senate. On April 28th, Senator Majority Leader McConnell stated that infrastructure will not be part of a Phase 4.0 relief package, despite the insistence of the White House. Leader McConnell stated that there is “…an equal interest in doing an infrastructure bill…”, however, “We don’t have an equal interest in borrowing money from future generations to pay for it. In other words, its unrelated to the coronavirus pandemic.”
On Monday, May 4th, Speaker Pelosi, on a phone call with Democratic Members, expressed her desire to push forward on CARES 2.0. They are looking to obtain at least $1 trillion to fund State and Local Governments and further supporting safety net programs. House Democrats are hoping to have a finalized package at the end of this week, and the bill on the floor to vote on, by next week. Many House members, believe that they will not get everything they want in this CARES 2.0 bill, but are using it as leverage for any Senate relief package that may be introduced. However, with the House not in session due to the coronavirus, it is unlikely will meet next week, and are unsure when they will be back. Republicans are staying firm in opposition to the Democratic-proposed bill, unless concessions are made, such as liability protections for businesses, and a Trump Administration-supported payroll tax cut. House and Senate Republicans are also concerned with the cost of the proposed bill. House Minority Leader Kevin McCarthy stated on Monday, that in addition to the cost of the bill, he is concerned with the implementation of the bill.
“HEROES Act-Phase 4”
On Tuesday, May 12th, Speaker Pelosi announced further legislation to address the COVID-19 pandemic. H.R. 6800, the “Health and Economic Recovery Omnibus Emergency Solutions Act”, or the “HEROES Act” was sponsored by House Committee Appropriations Chairwoman Nita Lowey (D-NY 17th). Click HERE to view the bill as introduced. The 1,815 page bill calls for $3 trillion to be appropriated to address several issues relating to COVID-19 relief. Although it is expected to pass in the House, the bill, that Senator Majority Leader McConnell strongly described as an ”…1800-page seasonal catalog of left wing oddities” is considered dead on arrival in the Senate. If passed, this would be the largest relief package in history.
Health sciences are an important part of the bill, although not as substantial as the CARES Act. In this bill, the National Institutes of Health (NIH) would receive $4.745 billion “…to expand COVID-19-related research on the NIH campus and at academic institutions across the country and to support the shutdown and startup costs of biomedical research laboratories nationwide.” The CDC would be appropriated $2.1 billion to support federal, state, and local public health agencies. The U.S. Department of Health and Human Services’ Assistant Secretary for Preparedness and Response would receive a total of $4.575 billion to respond to the COVID-19, with $3.5 billion for the Biomedical Advanced Research and Development Authority (BARDA) for therapeutics and vaccines; $500 million for BARDA to support U.S.-based next generation manufacturing facilities; $500 million for BARDA to promote innovation in antibacterial research and development; and $75 million for the Office of the Inspector General. The Public Health and Social Services Emergency Fund would be appropriated $175 billion to reimburse for health care related expenses or lost revenue attributable to COVID-19, as well as support testing and contact tracing to effectively monitor and suppress COVID-19, including: $100 billion in grants for hospital and health care providers to be reimbursed health care related expenses or lost revenue directly attributable to the public health emergency resulting from COVID-19; and $75 billion for testing, contact tracing, and other activities necessary to effectively monitor and suppress COVID-19. On Friday, May 15th, the House voted on and passed the HEROES Act (299 Yeas/199 Nays/24 NV). Unlike the previous relief packages, the HEROES Act was voted along partisan lines.