COVID-19 Federal Update 3-26-2020

March 26, 2020

Senate Passes Stimulus Package

Just after 11:30 pm last night, the U.S. Senate approved a historic $2 trillion rescue plan to respond to the economic and health crisis caused by the coronavirus pandemic.  The House plans to meet at 9 am on Friday to consider the stimulus package and expects to pass it by a voice vote, a process that would not require all members to return to Washington. House GOP leaders said they also support this strategy. However, any House member could demand a recorded, roll-call vote, which has potential to drag out the process.

The massive legislation passed on a 96-0 vote after days of intense negotiations between Senate Republicans and Democrats, who demanded changes to the bill introduced last week by Senate Majority Leader Mitch McConnell.

The package includes an unprecedented injection of loans, tax breaks and direct payments for major corporations and individual taxpayers to help the U.S. economy get through an abrupt shutdown as people avoid social interaction and businesses close to keep from spreading the coronavirus. More than 68,000 people in the U.S. have been infected with the deadly respiratory disease and some economists warn that unemployment could hit 30%.

The package provides for about $500 billion in loans and assistance for big companies, including struggling airlines, as well as states and cities. There is a separate pot of about $350 billion for small businesses. For individuals the package provides direct payments to lower- and middle-income Americans of $1,200 for each adult, as well as $500 for each child. Unemployment insurance would be vastly expanded. There also is money for hospitals, some of which are on the verge of being overwhelmed .

The size of the stimulus package is unprecedented, dwarfing the approximately $800 billion Obama stimulus that passed five months after the 2008 financial crash. Together with Federal Reserve actions, the legislation amounted to a $6 trillion stimulus, according to White House economic adviser Larry Kudlow, or about 30% of annual GDP.

Yet it may not be enough to prevent a big short-term hit to the economy and a dramatic rise in unemployment. Economists and lawmakers say they expect more stimulus will be needed. Congress is already discussing a next round.

House Speaker Nancy Pelosi praised the deal, which was worked out principally by Senate Democratic leader Chuck Schumer and Treasury Secretary Steven Mnuchin over several days of marathon negotiations.

The outbreak has touched directly on Congress, where three lawmakers have reported testing positive for the coronavirus and several others are in self-quarantine.

Passage in the Senate had been delayed for hours on Wednesday by objections from four GOP senators over expanded unemployment benefits for low wage workers.

The expectation of a Senate vote helped propel the S&P 500 Index to its biggest two-day advance since November 2008. But stocks receded from the day’s highs late in the afternoon as the Republican senators raised their objections and independent Senator Bernie Sanders countered with a threat to hold up the legislation.

The Senate blocked an amendment to modify the unemployment benefits provision that had been offered by Nebraska Republican Senator Ben Sasse before moving to pass the overall bill.

Another delay was happening behind the scenes. According to a Democratic aide, Republicans had left out of a draft agreed upon language that requires the Treasury and Federal Reserve to publish every seven days which companies and entities gain financing through loans from the $500 billion bailout fund.

Democrats had been demanding transparency on the loans and Schumer held up the bill until Republicans changed the text, the aide said.

Read a copy of the bill text here,

Summary of the bill from Senate Appropriations Committee Republicans here

Summary from Senate Appropriations Democrats here.

Senators will recess until April 20 after passing the $2 trillion package, but could come back for further votes with 24-hours notice, McConnell said on the Senate floor last night.


Winners and Losers in the Economic Stimulus


More aid for companies, strings attached

The plan would include about $500 billion in loans and assistance for larger companies, as well as states and cities, according to the latest drafts being circulated. But the aid comes with strings attached after pressure from Democrats.

Companies receiving a government loan would be subject to a ban on stock buybacks through the term of the loan plus one additional year. They also would have to limit executive bonuses and take steps to protect workers. The Treasury Department would have to disclose the terms of loans or other aid, and a new Treasury inspector general would oversee the lending program.

The bill is largely a win for the retail, hotel and restaurant industries that initially viewed lawmakers as favoring the airline industry. Trade groups representing those sectors lobbied Congress hard for loans, grants and unemployment assistance because their businesses have also suffered coronavirus-related revenue losses.

Airlines win loans, cash-for-equity bailouts

Struggling U.S. airlines would be eligible to receive federal loans and direct cash assistance if they are willing to give an option for an ownership stake to the government.

The program allocates $25 billion to passenger carriers and $3 billion to airline contractors providing ground staff such as caterers, while cargo haulers would see $4 billion.

The addition of direct cash relief — earmarked specifically for payrolls — was sought by airline and industry unions, which feared massive job losses if loans were the only option.

U.S. airlines probably will avoid applying for some $25 billion in loans under a federal aid package designed to help them survive the collapse in travel from the new coronavirus, according to JPMorgan Chase & Co.

The legislation doesn’t include emissions limits for airplanes that were sought by House Democrats, Senator Pat Toomey, a Pennsylvania Republican, said on a press call.

Other transportation winners include rail and transit operators. Amtrak would get $1.02 billion to cover coronavirus-related revenue losses and support state-funded routes. State and local transit agencies would get $25 billion for operating and capital expenses.


Small businesses wanted cash injections

The bill carves out more than $350 billion in aid for small businesses, much of which would be in loans through the Small Business Administration and banks, guaranteed by the federal government. The loans would be forgiven provided the businesses meet certain requirements, including limiting reductions in pay and layoffs, though with more flexibility for employers than the original Senate bill.

Industry advocates previously said loans weren’t enough, especially for the smallest outfits, although some expressed more optimism on Wednesday. An instant cash injection is the only way to save them from failing, according to the Small Business Majority.


Cash for citizens, gig workers

The package would provide direct payments to lower- and middle-income Americans of $1,200 for each adult, as well as $500 for each child.

Democrats were able to secure a change from a previous version that allows low-income taxpayers to get the full $1,200 payment. The initial plan would have given smaller checks, or in some cases, no money at all, to very-low income people.

Unemployment insurance payments were bolstered and recipients would be eligible to receive those funds for an average of four months, up from three in the prior GOP plan. It also would extend eligibility to the self-employed and workers in the gig economy such as drivers for Uber Technologies Inc.


Money for hospitals under health-care ‘Marshall Plan’

The legislation calls for $117 billion for hospitals and veterans’ health care, as well as $16 billion for personal protective equipment, ventilators and other medical supplies for federal and state response efforts. It also includes $11 billion for vaccines, therapeutics, diagnostics and other medical needs, and at least $250 million to improve the capacity of health-care facilities to respond to medical events, according to a summary by the Senate Appropriations Committee.

The bill would require insurers to cover tests for Covid-19. Labs would be required to post cash prices for the tests on public websites, and insurers would have to pay those prices or another privately negotiated rate. Any vaccines or other preventive services would have to be covered with no cost-sharing.

The measure would temporarily lift Medicare payment cuts and includes a 20% increase in Medicare payments to hospitals for treating Covid-19 patients.

The hospital industry supported the measure for providing emergency funds, boosting payments and suspending some funding cuts. But “more will need to be done to deal with the unprecedented challenge of this virus,” Rick Pollack, head of the American Hospital Association, said in a statement.


Mortgage relief for wide swath of borrowers

Many U.S. homeowners and businesses hit hard by coronavirus could get relief from making their monthly mortgage payments through the bill.

Borrowers with loans insured by government agencies such as the Federal Housing Administration and the Department of Veterans Affairs would be eligible for forbearance. Consumers whose mortgages are backed by Fannie Mae and Freddie Mac would also be eligible to skip payments.

U.S. regulators have already mandated forbearance to borrowers facing financial hardships due to coronavirus, in addition to suspending foreclosures and evictions through the end of April and in some cases longer.

Under the Senate bill, borrowers would be eligible for 60 days of forbearance if they can demonstrate virus-related financial stress. The relief can be extended for 30 days up to four times.

Mortgage servicers, who collect homeowners’ monthly payments, couldn’t demand documentation proving economic hardship. Instead, borrowers would just have to attest that they’re struggling, according to the text of the legislation.

Commercial borrowers with federally backed loans could potentially skip payments for at least 30 days with a possible extension of up to 60 additional days. Unlike individual consumers, businesses would have to document financial hardship and they would be barred from evicting tenants as long as they are missing mortgage payments.

Emergency aid for farmers included

The stimulus package includes up to $23.5 billion in farm aid. It would provide $9.5 billion in emergency funds for agriculture, including livestock producers and growers of specialty crops such as fruits and vegetables. And it would authorize $14 billion in new borrowing authority for the U.S. Agriculture Department’s Commodity Credit Corp., a Depression-era entity the Trump administration has used for its farm-bailout programs the past two years.

Agriculture groups including the American Farm Bureau Federation, the United Fresh Produce Association and livestock groups had sought aid in the stimulus package.


State and local governments get relief

A coronavirus relief fund with $150 billion would be created for states, cities and other local governments. Additional funds will be set aside for territories, tribal governments and other entities.

The package includes $400 million for the Election Assistance Commission to provide grants in response to the coronavirus outbreak. The funds could be used to expand voting by mail, early voting and online registration and bolster in-person voting, according to a Senate aide. The bill doesn’t create a national requirement for voting by mail, which Republicans objected to.


No aid for Trump properties

Democrats won language that would bar any business owned by President Donald Trump or his family from getting loans from Treasury. Businesses owned by members of Congress, heads of executive departments and Vice President Mike Pence also would be blocked from receiving aid under the stimulus program.


Oil industry, renewables both lose

A $3 billion provision in the original GOP bill to buy oil for the nation’s Strategic Petroleum Reserve was cut by negotiators. The funding for the emergency stockpiles had been requested by the Trump administration for the purchase of up to 77 million barrels of crude oil to support the domestic industry and boost reserves at cheap prices.

Democrats sought to add billions in funding for clean energy in exchange and in the end both were scuttled. But the issue could arise as Congress takes up additional coronavirus-related legislation in coming weeks.

The omission of expanded tax incentives for renewable energy and spending on green infrastructure is a blow to advocates of solar, wind and electric vehicles who worry that a buildup of new federal debt from stimulus spending will discourage green investment and lending in the future.

The measure disappointed renewable advocates, who are seeking more flexibility to claim existing credits as project timelines slip. Abigail Ross Hopper, head of the Solar Energy Industries Association, said that half of the industry’s jobs are at risk as a result of the pandemic.

Supporters of oil purchases said they still expected the acquisitions to take place. The Energy Department can use other agency funds and it can seek more money in future stimulus legislation.

Anne Bradbury, head of the American Exploration and Production Council that represents independent oil producers, said the group is “confident that DOE will be able to meet the president’s directive to purchase as much as $3 billion in U.S.-produced crude.”


Democrats Win Stimulus Oversight: Democratic lawmakers scored a key political victory in the bill by securing independent oversight of some $500 billion for distressed businesses, but the extra scrutiny may slow the flow of cash. The original proposal from McConnell would have given Treasury Secretary Steven Mnuchin nearly unchecked authority over the money. “I’ll be the oversight,” Trump said Tuesday, a statement met with mockery by Democrats.

Instead, Senate Republicans agreed to largely adopt a proposal from Speaker Nancy Pelosi (D-Calif.) for both an independent inspector general to monitor the flow of money and a five-member panel appointed by Congress to oversee the program. But implementation of the oversight is causing concern, particularly because Mnuchin’s department is already understaffed. Read more from Justin Sink and Saleha Mohsin.

Governors Say Stimulus Deal Falls Short: The biggest federal stimulus program in history doesn’t go far enough for state and localities facing unprecedented financial pressure brought on by the coronavirus pandemic, according to U.S. governors whose states have been hardest hit by the crisis. The bill sets aside nearly $275 billion in emergency funds for state and local governments including $100 billion for hospitals, $45 billion in disaster relief funds, and $25 billion for transit systems, according to the Senate Appropriations Committee. There is also an expected $150 billion virus fund for states.

“We still need more federal resources directly to the states that are on the front lines of this crisis,” Maryland Gov. Larry Hogan (R), who chairs the National Governors Association, said at a press conference yesterday. “We’re gonna come back and ask for additional funding for the states and local governments to help with this crisis in the next round of stimulus.” Read more from Fola Akinnibi.


Other Economic Efforts

Kudlow Says Jobless Claims to Show a Big Increase: White House chief economic adviser Larry Kudlow said a government report due today will show a “very large increase” in the number of Americans filing for unemployment benefits, without giving a specific number. “I’m not at liberty to say” whether the number is in the millions, Kudlow said yesterday in an interview with Fox News Channel. “But it’s going to be a very big increase — everybody in the market knows that.”

The median estimate of economists surveyed by Bloomberg shows initial jobless claims surged to a record 1.6 million last week, with projections running as high as 4 million, amid widespread business shutdowns aimed at preventing the coronavirus from spreading, Jordan Fabian reports.

Powell Will Make Rare TV Appearance Today: Federal Reserve Chairman Jerome Powell will make a rare televised interview appearance in a broadcast today, as the U.S. central bank deploys an unprecedented array of tools to prevent the health crisis from becoming a financial one. Powell will be interviewed on the NBC Today show — one of the country’s main morning television programs — at 7:05 a.m., according to an advisory released by the Fed. It will mark the Fed chief’s first public remarks since he held an unusual Sunday evening press briefing by teleconference on March 15. That was following a policy meeting that the central bank conducted days early in order to speed stimulus to the economy and financial system, Christopher Anstey reports.


Prevention & Treatment

U.S. Among Worst Hit Globally as Deaths Top 1,000: More than 1,000 people in the U.S. have died from the novel coronavirus, according to data compiled by Johns Hopkins University, making it one of the worst-affected countries in the global pandemic. The U.S. has the sixth-highest death toll among nations, the data shows. Italy has suffered the most fatalities from the virus worldwide, with more than 7,500 deaths as of today. China, Spain, Iran and France have also seen more than 1,000 deaths each. Globally, over 470,000 people have been infected while more than 21,000 have died. The U.S. has a total of about 69,000 confirmed cases.

The grim milestone comes after a sharp acceleration of infections prompted the World Health Organization to warn the U.S. could become the next center of the global outbreak. Patients in the U.S. have complained of not being able to access tests, while doctors say they’re already facing shortages of medical equipment and supplies. Read more from Rachel Chang.

Meanwhile, New Jersey is on track for the kind of viral surge New York is experiencing, the state’s health commissioner said. “Our trends are tracking our neighbors’,” Judy Persichilli said of New York’s coronavirus infection rate at a news conference yesterday in Trenton. New Jersey has 4,402 infections, up from 3,675 on Tuesday, Gov. Phil Murphy (D) announced at the conference. Deaths climbed to 62, he said. That’s up from 44, according to data posted on the state’s website, Elise Young reports.

Conflicting Emergency Decrees in U.S.: The limits of who has what emergency powers is being challenged by the pandemic as states restrict visitors and order residents to stay at home and as Trump mulls the lifting of precautions over the objections of governors. Authorities can demand quarantines and the closure of businesses, Lawrence Gostin, a Georgetown University public health professor, said. That would remain in force even if the president decides to urge the lifting of restrictions, as he suggested Tuesday he might do next month. The president “implies he has legal power to order back to work. Untrue,” Gostin said.

Trump’s assertion of powers he lacks is only one potential flashpoint exposed in the collision between the pandemic and the American political system. From the White House down to governors and mayors, officials are creating a patchwork of orders restricting commerce, travel, or public gatherings. Some of those laws being brought into play date to the early 20th century—long before air travel on a commercial scale, or the CDC. Read more from Todd Shields, Chris Dolmetsch, and Malathi Nayak.

Gottlieb Warns of Fast Re-Openings: The U.S. could see up to 100,000 Covid-19 cases in a matter of days, and limits on public movement shouldn’t be lifted by Easter as Trump has suggested, according to his former FDA commissioner, Scott Gottlieb. “There’s some difficult days ahead, but hopefully we won’t have the tragic consequence that Italy did,” Gottlieb, now a fellow with the American Enterprise Institute think tank, said in an online health forum sponsored by the Wall Street Journal. Gottlieb said he hoped the spread of the disease in the U.S. would more closely resemble that in South Korea or in Germany. Sara Hansard has more.

Virus Likely Curtailed China Drug Output, Raising Shortage Fears: Drug manufacturers in China may have cut production by almost 40% early this year as the novel coronavirus spread there, according to a U.S.-based group that supplies the basic tools for testing the quality of many medicines. China is the backbone of the world’s drug supply. Any disruption in the country’s output could result in shortages of medications that will be in high demand as the U.S. grapples with Covid-19. Read more from Anna Edney.

Trump to Have FEMA Direct Supplies Among States: The Trump administration is expected to soon direct how manufacturers will distribute crucial medical supplies — including protective gear and ventilators — to combat the outbreak, alleviating what U.S. governors have complained is a chaotic marketplace for the products. The Federal Emergency Management Agency will take charge of allocating the supplies nationwide, according to three people familiar with the matter, under a clause of the Defense Production Act. The law gives the government vast powers to direct industrial production in crises, but Trump has repeatedly said he’s reluctant to use it.

Governors, however, have complained publicly that they have found themselves in competition with one another and with the federal government to procure equipment including ventilators after Trump told them March 19 to try to obtain medical supplies on their own. Read more from Shira Stein.

Other News Stories

Remote Voting Options: It’s too late for the House to implement remote voting on the Senate’s stimulus legislation, but some members are still pushing for the option even as leaders explore alternative ways to pass bills without calling their members back to Washington. Both parties’ leaders are discussing the best way for the chamber to quickly pass the urgently needed legislation.

Meanwhile, House Rules Chairman Jim McGovern (D-Mass.) hasn’t yet closed the door on the possibility of House members one day being able to vote remotely. But he and ranking member Tom Cole (R-Okla.) agreed that is not happening this week. Read more from Billy House.

Paper Hearings Replace Public Ones: The Senate will set a new precedent today when it holds the first “paper” committee hearing to mitigate risks of large public gatherings amid rising coronavirus threats.

The Senate Armed Services Committee said it is canceling the public hearing it planned on the needs of the Army and instead will collect written materials from Army officers and make them public on its website, as well as statements from Chairman Jim Inhofe (R-Okla.) and others.

The committee said the plans for paper hearings are still being developed but call for senators’ questions and witness answers to be posted within a week of opening statements. Still, it said the panel’s plans may change to ensure the Pentagon is able to fulfill its duties, particularly those related to combating the coronavirus response. Read more from Nancy Ognanovich.

Vote-by-Mail Gains Momentum: While Sens. Amy Klobuchar (D-Minn.) and Ron Wyden (D-Ore.) push to expand vote-by-mail programs, a small group of companies argue for an alternative, one they claim will boost voter participation nationwide: mobile voting.

Jurisdictions in at least 15 states are planning to use mobile balloting in a limited capacity in 2020 to account for overseas voters and those with disabilities. Proponents of a digital electorate hope the coronavirus spurs adoption of their technology. The virus has provided an “opportunity,” says Bradley Tusk, chief executive officer of Tusk Holdings and a supporter of mobile voting: “People are being told by the government not to congregate, and that’s a pretty clear directive not to go vote .” Tusk, who says he hasn’t invested in any mobile voting companies, has spent “in the low seven figures” helping local governments cover the costs of adopting the systems.

Massachusetts Institute of Technology doctoral student Michael Specter describes Tusk’s position as a “false dichotomy” that ignores postal ballots. He and his colleagues say mobile voting technology is unproven and opens the door to cyber risks. Read more from Kartikay Mehrotra.

Pennsylvania, Ohio Back-Load Primaries: Democrats’ primary calendars got a little more back-loaded after Pennsylvania lawmakers voted to delay the state’s primary from April 28 to June 2 due to the pandemic. Ohio legislators separately passed a bill extending absentee voting by mail until April 28, though they didn’t reschedule an in-person voting day to replace its postponed March 17 primary. Pennsylvania joins Connecticut, Delaware, Indiana, Maryland, and Rhode Island, which all delayed primaries in April and May until June 2—when  Montana, New Jersey, New Mexico and South Dakota were already planning to hold primaries. Beckwith reports.

Biden Rejects April Debate: Joe Biden rejected any idea of an April debate with Sen. Bernie Sanders (I-Vt.), signaling yesterday that he views the Democratic nominating contest as essentially over. “I think we’ve had enough debate,” Biden said during a live streamed news conference. “I think we should get on with this.”

Sanders, however, responded later that he wanted a face-off because it would help inform Americans as they confront the coronavirus. “One of the things that I think the people want, especially in this unprecedented crisis in modern American history, is to hear the ideas of candidates as to how we got into this disaster,” Sanders said Wednesday evening on CNN. “So I think we need a good debate as to where we go, not only just now but in the future.” Read more from Ryan Teague Beckwith and Tyler Pager.

Trump Campaign Protests Virus Ad: The Trump campaign asked TV stations in swing states to pull an ad showing the president calling the coronavirus a “hoax” his allies say is misleading. The ad from Priorities USA shows the curve of U.S. cases mounting from Jan. 20 to March 22 while featuring audio of Trump downplaying the threat during that time. “The coronavirus,” Trump is shown as saying before a second clip plays, “this is their new hoax.” Trump’s campaign says that he was describing Democrats’ efforts to politicize the coronavirus pandemic, not calling the virus itself a hoax, Ryan Teague Beckwith reports.

Saudis Told to Not Unleash Oil: The Trump administration is calling on Saudi Arabia to dial back its plan to flood the oil market after a price war with Russia sent crude prices falling to their lowest levels in almost two decades. While its status as the world’s biggest producer means the U.S. is sheltered in part from the collapse, the White House wants Riyadh to hold back on a plan to supply a record 12.3 million barrels a day next month, people familiar with the situation said. It’s seeking the Saudis’ help in bringing oil prices back to where they were before the market cratered in early March, one of the people said. Read more from Glen Carey, Javier Blas, Nick Wadhams and Stephen Cunningham.

Today on the Hill

White House

  • 7:50 am – In-House Pool Call Time
  • 8:00 am – Trump participates in a G20 Leaders’ video teleconference
  • 5:00 pm – Members of the Coronavirus Task Force hold a press briefing
  • 9:00 pm – Interview: Hannity on Fox News


  • Leaves for recess and will return April 20th


  • Still in recess, House to meet Friday morning to consider Senate-passed stimulus measure


Additional legislation introduced Yesterday

S.3587 — 116th Congress (2019-2020)A bill to require the Secretary of Veterans Affairs to conduct a study on the accessibility of websites of the Department of Veterans Affairs to individuals with disabilities, and for other purposes.


Bills Passed Senate yesterday

H.R.3504 — 116th Congress (2019-2020)Ryan Kules Specially Adaptive Housing Improvement Act of 2019

H.R.4771 — 116th Congress (2019-2020)VA Tele-Hearing Modernization Act

S.3587 — 116th Congress (2019-2020)A bill to require the Secretary of Veterans Affairs to conduct a study on the accessibility of websites of the Department of Veterans Affairs to individuals with disabilities, and for other purposes.

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