Highlights of the omnibus funding bill

December 21, 2020

Congress Set to Vote on Aid, Spending Deal Lawmakers plan to file and pass a massive government funding and coronavirus relief bill today, after giving themselves 24 hours more to wrap up work. The House and Senate are set to vote today on a $1.4 trillion omnibus funding bill combined with a nearly $900 billion stimulus, and congressional leaders said they expect the legislation to pass both chambers. The White House said President Donald Trump would sign it. Lawmakers passed, and Trump signed, a one-day continuing resolution to move last night’s funding deadline to tonight. Negotiators still haven’t released the text, but they say they have an agreement and details of the measure have been reported.

Senate Majority Leader Mitch McConnell (R-Ky.), Speaker Nancy Pelosi (D-Calif.) and Senate Minority Leader Chuck Schumer (D-N.Y.) announced the accord yesterday. The deal followed more than a week of furious negotiations sparked by a group of Democratic and Republican senators who drew up their own compromise proposal and urged their leaders to act. The coronavirus section of the legislation is the second largest stimulus ever, Schumer said yesterday. A $900 billion measure would be smaller than April’s $1.76 billion CARES Act (Public Law 116-136) but larger than the $831 billion American Recovery and Reinvestment Act of 2009, according to Congressional Budget Office estimates.

Omnibus

The larger $2.3 trillion package includes $1.4 trillion in regular appropriations to keep the government operating through the end of fiscal 2021 on Sept. 30.

  • A last-minute deal kept $12.5 billion for Veterans Affairs health funding under the total spending budget cap.
  • $1.4 billion for border wall construction and related spending, short of Trump’s request for nearly $2 billion. His $5 billion request for fiscal 2019 led to the longest shutdown in the country’s history, but he hasn’t had a standoff with lawmakers over wall funding since he circumvented Congress by using military funds to build additional fencing
  • The combined bill also includes long-discussed legislation to protect patients with health insurance from “surprise” medical bills in most emergency situations, including air ambulance rides. Patients also wouldn’t have to pay bills received more than 90 days after a visit, and health plans and providers would have to provide patients with more information on their networks and costs.
  • The spending package also includes the long-standing Hyde amendment, which bars federal funds for most abortions, and the Helms amendment, which bars the use of foreign assistance funds for abortions. Congressional Democrats have said they want to remove the Hyde amendment from spending bills starting in fiscal 2022, when a Democrat will be in the White House. President-elect Joe Biden has said he also opposes the Hyde amendment.
  • The bill also calls for the U.S. to join other nations in phasing out hydrofluorocarbons used in air conditioning and refrigeration systems. While hydrofluorocarbons aren’t nearly as bad for the ozone layer as chlorofluorocarbons, the chemical they were designed to replace, they still have hundreds to thousands of times the heat-trapping power of carbon dioxide.
  • The legislation includes a reauthorization of the Water Resources Development Act that deals with water-related infrastructure.
  • The package also extends tax credits for renewable energy projects, including wind and solar production.

Coronavirus Stimulus

The new round of stimulus funding is the first COVID-19-related legislation that will pass Congress dating back to March. In May, the House passed the $3.4 trillion HEROES Act it had hoped would become the baseline of talks to come, but McConnell was unmoved, having instituted a “pause” in talks early that month. Subsequently, both chambers passed messaging bills. The House passed a $2.2 trillion version of the HEROES Act, with the Senate passing multiple “targeted” packages with a price tag of roughly $500 billion. Talks picked up in earnest when a bipartisan group of lawmakers proposed a $908 billion bill after Thanksgiving, serving as the basis in talks in recent weeks. Negotiations on the legislation set to pass came together after McConnell, Pelosi, Schumer and House Minority Leader Kevin McCarthy (R-Calif.) convened for hours of talks on Tuesday, setting the tone for Sunday’s announcement.

What Else is in the Spending Deal: The combination spending bill and coronavirus relief measure also includes funds for virus testing, tracing and vaccine development and distribution. It provides $13 billion for nutrition assistance.  The spending package includes the long-standing Hyde amendment, which bars federal funds for most abortions, and the Helms amendment, which bars the use of foreign assistance funds for abortions. Congressional Democrats have said they want to remove the Hyde amendment from spending bills starting in fiscal 2022, when a Democrat will be in the White House. President-elect Joe Biden has said he also opposes the Hyde amendment.

Nutrition

  • The stimulus deal reached as part of a year-end spending package includes $26 billion for farm aid and nutrition programs, according to a summary obtained by Bloomberg.
  • It would allot $13 billion to boost Supplemental Nutrition Assistance Program, or SNAP, benefits by 15% for six months—a Democratic demand
  • The bill would set aside $13 billion for direct payments, purchases, and loans to farmers and ranchers hurt by the coronavirus pandemic
  • Puerto Rico and other U.S. territories would receive $614 million for food aid
  • Extra funding would also go toward food banks, senior nutrition programs, and programs supporting new and beginning farmers, among others

Direct Payments

  • $166 billion in direct checks — Individuals making up to $75,000 a year will receive a payment of $600, while couples making up to $150,000 will receive $1,200, in addition to $600 per child. The deal also makes the stimulus checks more accessible to immigrant families.

Unemployment

  • $120 billion in extra unemployment help.  Federal unemployment insurance benefits will be extended for 10 weeks through mid-March, with each week supplemented by a $300 payment, similar to the extra $600 supplement that expired at the end of July.
  • Pandemic Emergency Unemployment Compensation, which provided up to 13 additional weeks of jobless benefits to those who had exhausted their regular state benefits, was extended as well.
  • Unlike stimulus payments and forgiven PPP loans, which aren’t subject to federal taxes, unemployment insurance recipients must pay income taxes on their jobless benefits. Many states don’t automatically withhold taxes when they distribute those payments, so recipients will owe those taxes when they file their tax returns next spring.

Paycheck Protection Program

  • The aid package includes $284 billion for the Paycheck Protection Program that was created in the CARES Act. That program’s loans to firms with fewer than 500 employees can be fully forgiven if companies keep people on their payroll.
  • The legislation clarifies that business owners can write-off expenses paid for with forgiven PPP loans, giving small companies a tax break that could amount to more than $100 billion. The legislation would override an IRS decision that says business can’t claim deductions on costs, such as rent and wages, paid for with tax-free PPP money.

Tax Credits

  • The legislation includes a priority for President Donald Trump: an expansion of the business meals deduction — a tax preference he narrowed just three years ago in his 2017 tax overhaul. Economists have said the change would do little to help struggling restaurants.
  • It also includes a renewal of the employee retention tax credit for businesses that keep workers on their payrolls. The break gives companies an additional incentive to keep people employed as many firms still face revenue downturns but have run out of PPP money or never qualified for it.
  • The package makes changes to the earned income tax credit and the child tax credit to make it available to people who lost wages or jobs during the pandemic, as well as an expanded Low Income Housing Tax Credit to boost construction of housing for low-wage families.
  • The legislation would make permanent an excise tax break for beer brewers, wine makers and distillers. In addition, other expiring tax credits, including some for mortgage interest premiums and tax credits to help businesses in low-income communities.

Housing

  • The measure contains $25 billion for emergency rental assistance, and it extends the CARES Act’s eviction moratorium until Jan. 31.
  • Other key funding provisions include funds for virus testing, tracing and vaccine development and distribution. It also has $82 billion for education funding, as well as $7 billion for broadband, $10 billion to support childcare providers and funds for the U.S. Postal Service. It provides $13 billion for nutrition assistance.

Transportation

  • $15 billion to reinstate payroll reimbursements to airlines that expired two months ago, according to two people familiar with the legislation. The legislation is similar to provisions in an earlier pandemic aid package that expired on Oct. 1, which barred layoffs and came with other restrictions.
  •  $1 billion for airline contractor payrolls
  • $10 billion for state highways
  • $2 billion for airports and airport concessionaires
  • $2 billion for the private motor coach, school bus, and ferry industries
  • $1 billion for Amtrak, as well as funds for the postal service.
  • Another $14 billion is targeted at transit agencies to keep services running for essential workers and others who use rail, bus, paratransit and other forms of mass transportation, according to one Democratic aide.

COVID Vaccine

  • $69 billion for vaccines, testing and tracing — The package includes $20 billion for the purchase of vaccines, nearly $9 billion for vaccine distribution and about $22 billion to help states with testing, tracing and Covid-19 mitigation programs.

Restoring Medicaid for the Marshallese

  • Tens of thousands of Marshall Islanders will be allowed to sign up for Medicaid, with the year-end agreement revising a drafting mistake in the 1996 welfare reform bill that barred the islanders from the program.

Education and Child care

  • Included in the $82 billion total for colleges and universities is more than $4 billion for a governors’ relief fund, more than $54 billion for public K-12 schools and nearly $23 billion for a higher education fund. Separately, the child care sector will receive about $10 billion in emergency cash.

Higher Education

  • The legislation includes a bipartisan agreement to forgive nearly $1.3 billion in federal loans to historically Black colleges and universities, deliver Pell grants to incarcerated students after a 26-year ban and simplify financial aid forms — the last of those three has been a long-time priority for the retiring Alexander.

Pay boost for troops 

  • The omnibus portion of the year-end package includes a 3 percent military pay raise.

Contractor relief

  • The package continues a CARES Act program that allows contractors to keep employees on the payroll even if federal facilities close.

Broadband

  • The agreement invests $7 billion to increase expand broadband access for students, families and unemployed workers, including $300 million for rural broadband and $250 million for telehealth.

 

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