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Bipartisan coronavirus relief talks stuck on liability waiver

Liability shield for employers still a work in progress; direct aid to households also a sticking point

Sen. Chris Coons, D-Del., is one of the key players in drafting compromise liability shield provisions.
Sen. Chris Coons, D-Del., is one of the key players in drafting compromise liability shield provisions. (Bill Clark/CQ Roll Call file photo)

A group of House and Senate lawmakers from both sides of the aisle has fleshed out details of their $908 billion coronavirus relief plan, except for the two thorniest issues: business liability protections and state and local aid.

A six-page summary of the group’s proposal circulated Wednesday morning said they had an “agreement in principle” to provide $160 billion in direct aid to states and localities and indemnify employers in some way from coronavirus-related lawsuits.

But that agreement didn’t solidify into finalized language Wednesday as negotiators had hoped.

“I don’t think it’s going to be tonight,” Sen. Mitt Romney, R-Utah, one of the group’s leaders, told CQ Roll Call on Wednesday evening.

Romney’s assessment suggested the group hit a snag on the liability protection language, which appears to be the last issue it needs to close out.

Sen. Joe Manchin III, D-W.Va., told reporters they had effectively reached agreement on state and local aid provisions Tuesday night, but the liability section was proving to be “a little bit tougher” to resolve.

The group wants to release details of state and local aid and liability protections together since congressional leaders have linked the two issues.

Wednesday’s summary fleshed out other sections of the one-page framework the group released last week on funding for small businesses, health care, rental assistance, education and more.

Sen. Chris Coons, D-Del., a lawyer, said Wednesday morning that the emerging liability language was likely to include a six-month moratorium on coronavirus-related lawsuits to give states time to come up with their own legislation providing for liability protections. For injuries that occurred in 2020, the group would provide businesses, universities and other institutions that could be targeted by lawsuits an “affirmative defense” they can use to counter excessive claims.

Republicans had proposed providing businesses blanket immunity except in cases of gross negligence, but Democrats said that was too narrow and would prevent most claims. The group appeared ready to compromise on the “affirmative defense,” which could give businesses that follow proper health and safety guidelines the ability to get lawsuits dismissed.

It wasn’t immediately clear if the “affirmative defense” proposal was the source of delay.

Some Democrats not directly involved in the group’s negotiations suggested Senate Majority Leader Mitch McConnell was preventing Republicans from compromising.

Senate Finance ranking member Ron Wyden, D-Ore., said McConnell was continuing his streak of trying to “gut” bipartisan efforts and then lay the blame on Democrats ahead of two Senate runoffs in Georgia on Jan. 5. Those races will determine who controls the Senate in the next Congress.

“He’d like to basically set himself up as a martyr where he can basically say, ‘The Democrats wouldn’t give me the liability waiver,’” Wyden said, referring to the liability protections as “basically a bailout for big multinational corporations.”

Tax rebates, unemployment benefits

The issue of direct aid to households is also gumming up the broader negotiations.

The bipartisan group’s package would offer $300 weekly federal supplements to state-based unemployment benefits for four months, but no one-time direct payments to households. A competing $916 billion proposal from Treasury Secretary Steven Mnuchin would provide tax rebates of up to $600 per person instead of added unemployment benefits.

Democrats want both, but Republicans say that costs too much. Some Democrats as well as Republicans say if only one makes it into the package, unemployment benefits are the way to go.

“Most of our members would rather have an extension of the plussed-up [unemployment insurance] benefit than having those checks, because at least those are going to people who don’t have jobs,” Senate Majority Whip John Thune, R-S.D., said.

Manchin said it “doesn’t make any sense” to provide direct payments instead of unemployment supplements.

“How can anybody say that ‘I’m going to send another check to people that already have a paycheck and job, and not send anything to the unemployed?’” he said.

Speaker Nancy Pelosi and Senate Minority Leader Charles E. Schumer called Mnuchin’s offer “progress” but said scaling back unemployment benefits was “unacceptable.”

They said Mnuchin’s proposal risks undermining the ongoing bipartisan talks, similar to their earlier reaction to McConnell’s offer to drop both liability provisions and state and local aid.

McConnell on Wednesday criticized the top Democrats for rejecting both approaches. “Two more brushoffs in about two hours — more deflection, more delay and more suffering for innocent Americans,” he said.

Sen. John Cornyn, R-Texas, suggested that ultimately the bipartisan group’s efforts, of which he is a part, will be overshadowed by the “Big Four” congressional leaders making the deal themselves as part of the massive year-end spending package taking shape.

But Pelosi signaled she’s giving the bipartisan group a lot of leeway to shape the deal. “I think that we’re close. That’s what they tell me, those who are negotiating,” she said.

Lawmakers are buying some extra time for negotiations. The House on Wednesday passed a one-week continuing resolution, which would stave off a partial government shutdown until at least Dec. 18. The 343-67 vote tees up Senate action as early as Thursday.

Bipartisan plan details

According to the plan’s summary, the bipartisan House and Senate group would renew an enhanced federal unemployment benefit that expired at the end of July at $300 per week — half of its original $600 amount — for 16 weeks. The benefit would start at the end of December and last into April 2021, according to the summary.

The group also proposes extending all pandemic unemployment insurance programs that expire at the end of December for 16 weeks. Those include benefits for gig workers who don’t qualify for state benefits and people who’ve exhausted their state allotments.

The plan would provide $1 billion for states to upgrade their unemployment systems for technology modernization and fraud prevention.

The largest component in the group’s proposal is $300 billion to renew the Paycheck Protection Program that provided forgivable loans for small businesses to supplement payroll and other fixed costs.

Only small businesses with 300 or fewer employees would be eligible for the second round of loans, compared to companies with 500 or fewer who had access to the first round. The businesses would also have to show they sustained a 30 percent revenue loss in any quarter of 2020 to qualify.

The proposal would set aside some of the loan funding for businesses with 10 or fewer employees and for small community lenders to issue loans to the small and minority-owned businesses in the networks. Funding would also be provided for independent live venue operators that have been shut down due to stay-at-home orders.

Small 501(c)(6) organizations with 150 or fewer employees that are not lobbying organizations, such as local chambers of commerce, economic development organizations and tourism offices, would become eligible for PPP, according to the summary.

The proposal would also clarify that business expenses paid with PPP loans are tax-deductible.

Other aspects of the group’s plan as outlined in the summary include:

  • $82 billion for education, including K-12 and colleges and universities and a flexible fund for governors, with eligibility for private schools.
  • $35 billion for health care providers, including $7 billion for rural providers.
  • $6 billion for vaccine development and distribution.
  • $9 billion for virus testing and contact tracing.
  • $25 billion in rental assistance to state, local and tribal governments and an eviction moratorium through January; payments would be geared towards lower-income households earning up to 50 percent of area median income.
  • An extension of student loan forbearance through April 30.
  • An extension of the Payroll Support Program for airlines that expired at the end of September, with funding through March 31.
  • Unspecified funding for public transit systems, Amtrak and the motorcoach and bus industry; last week’s framework chart set aside $45 billion total for transportation needs, including airline relief.
  • A 15 percent increase in Supplemental Nutrition Assistance Program benefits for four months
  • $13 billion for farmers, ranchers, growers and rural communities.
  • $10 billion for child care providers.
  • Allow the U.S. Postal Service to request a $10 billion forgivable loan from Treasury.
  • $6.25 billion for broadband connectivity grants.

Jessica Wehrman contributed to this report.

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