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Coronavirus relief package set to clear Monday, ending months of stalemate

Rescue measure emerges after hard-fought negotiations; bipartisan support seen after concessions from both sides

Lawmakers are on the cusp of sending a long-delayed $900 billion economic recovery and health care package to President Donald Trump’s desk, one that’s significantly downsized from prior Democratic ambitions but more than most Republicans prefer.

The coronavirus relief provisions were being added to a giant $1.4 trillion omnibus spending bill for fiscal 2021 that House lawmakers were set to vote on Monday. House leaders were structuring debate on the mega-package in two tranches to make the votes more palatable for members on both sides of the aisle, according to a source familiar with the plan.

The move to “divide the question,” as it’s known, would have lawmakers vote on one batch of bills related to “security” that are generally more up Republicans’ alley: a combination of the Defense, Homeland Security, Commerce-Justice-Science and Financial Services appropriations bills.

That measure would include $1.375 billion in border wall funding, for instance, according to a GOP summary, the same level as provided last year but much more than the zero dollars House Democrats support.

The other batch would consist of the eight remaining fiscal 2021 spending bills, the COVID-19 relief package and numerous other sidecar measures ranging from a clean energy package to water infrastructure legislation to a hard-fought deal to crack down on surprise out-of-network medical bills in emergency rooms and elsewhere.

The conservative Heritage Foundation was attempting to whip opposition among Republicans, and there were some urging President Donald Trump to veto the measure. But White House spokesman Ben Williamson said the president plans to sign it, and House Minority Leader Kevin McCarthy said he wasn’t expecting many GOP defections.

[Deal reached on $900B coronavirus relief package; votes likely Monday]

The coronavirus relief portion was the hardest nut to crack. Months of stalemate before the elections had led to hopes of a lame-duck thaw, but the Jan. 5 Georgia Senate runoffs and other backbiting threatened to leave the American people with no help for Christmas.

Finally this week, Democrats dropped their key demand for direct state and local aid, and Republicans dropped theirs: liability protections for businesses that get sued by workers, customers or others who blame them for getting sick.

And the final piece of the puzzle came late Saturday when Sen. Patrick J. Toomey, a Pennsylvania Republican, agreed not to try to prevent the Federal Reserve from ever restarting anything resembling the municipal bond market supports established earlier this year.

Details of the bill were provided as part of a Democratic summary and information from House Minority Whip Steve Scalise’s office and confirmed by staff and others familiar with the proposals.

Small businesses, museums, airlines

About a third of the aid bill would provide $325 billion in small-business relief, including $284 billion for another round of Paycheck Protection Program forgivable loans. And despite opposition from the Treasury, the bill would allow businesses to deduct expenses on their taxes for costs that were paid for by the federal government through the PPP, according to the GOP summary.

Other funding includes $20 billion for small-business disaster loans in low-income communities and $15 billion in grants to live entertainment venues, independent movie theaters, museums and other “cultural institutions.”

Another $12 billion would be set aside for financial institutions that lend mainly in lower-income and minority communities.

The bill would also direct $166 billion into another round of tax rebates, less generous for adults at up to $600 each but parents would get an extra $600 per child, up from $500 in the March aid law. Payment amounts would start phasing out at the same income thresholds as in March: $75,000 for individual filers and $150,000 for married couples filing jointly.

Federal supplemental unemployment benefits would be renewed for 10 weeks at $300 per week, from Dec. 26 through March 14. It also would extend two programs to help those who have exhausted their state benefits or who wouldn’t normally qualify for benefits, such as gig workers and the self-employed.

And certain jobless workers who had multiple jobs would get an additional $100 weekly boost in unemployment benefits. That boost is designed to offset the artificially low traditional benefit that doesn’t count self-employment income when calculating lost wages. All told, the jobless benefits would cost about $120 billion.

At a time when the coronavirus has been killing more than 3,000 Americans per day, the bill would pump about $32 billion into federal and state efforts to procure and distribute vaccines. Another $22 billion would go to states for virus testing and contact tracing.

For those at risk of becoming homeless, the bill would offer $25 billion in direct rental assistance, while extending a federal moratorium on evictions through Jan. 31.

The pandemic-battered transportation industry would get $45 billion, including $15 billion for airlines, $14 billion for mass transit, $10 billion for state highways and $1 billion for Amtrak.

‘Three-martini lunch’ break

Other industries were less fortunate. While details were not yet clear, there appeared to be no direct aid earmarked for independent restaurants, which have sought a $120 billion rescue fund.

But in a potential boost for upscale restaurants, bill writers sought to revive the “three-martini lunch” of a bygone era. The bill would restore 100 percent expensing of business meals for the next two years. That tax break had been cut back to 50 percent in 1993.

Other elements of the package include:

  • $82 billion to make schools and colleges safer for in-person learning, including $2.75 billion Republicans touted for private schools.
  • $10 billion for child care assistance, including to help day care providers with operating expenses.
  • Allowing lower-income child tax credit and earned income credit recipients to claim larger benefits for 2020.
  • Reimbursement of federal contractors for paid leave costs of those unable to work due to facility closures, such as national security facilities and national labs.
  • An expansion of the employee retention tax credit to help employers keep workers on the payroll during the pandemic.
  • $13 billion in increased food stamps and child nutrition benefits, as well as $13 billion for agricultural producers.
  • $7 billion to increase access to broadband in rural and underserved communities.

Reaching an aid agreement proved a far more arduous undertaking than the roughly $2 trillion relief package Congress easily passed in March. Months of off-and-on negotiations went nowhere, as each party accused the other of blocking needed relief.

Negotiators also had to accommodate a late push from the Trump administration and lawmakers of both parties who sought a second round of tax rebate checks.

And the length of expanded unemployment benefits had to be pared back from 16 weeks to 10 weeks — a move some Democrats criticized as an attempt to free up money for the tax rebates.

“There’s no reason why this urgent package could not have been signed into law multiple months ago,” said Senate Majority Leader Mitch McConnell, in blaming Democrats for insisting for months on trillions of additional dollars. 

Senate Minority Leader Charles E. Schumer, in turn, blamed Republicans for refusing to agree to meet the pent-up needs of people falling ill or becoming jobless.

For all the delay, the deal was sure to come as welcome news to families and businesses suffering from the pandemic and its economic effects. With more than 10 million workers jobless, another 885,000 people filed first-time unemployment claims last week, an uptick from the previous week’s tally.

Economists, including Federal Reserve Chairman Jerome Powell, have been urging Congress for months to pass a new aid package to avoid the prospect of a double-dip recession.

At roughly $900 billion, the new aid package is a far cry from the $3.4 trillion that House Democrats sought back in May. Senate Republicans had pushed for as little as about $519 billion last fall.

The final amount includes some money that’s repurposed from unspent funds, but all in all, the total dollar figure Congress devoted to pandemic relief this year would eventually add up to $3.4 trillion, assuming Trump signs the latest bill.

 “That is a historic figure matching a historic crisis,” Schumer said on the floor.

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Paul M. Krawzak, Niels Lesniewski, Lindsey McPherson, Jennifer Shutt and Doug Sword contributed to this report.

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