Senate majority leader announces approximately $900 billion deal on emergency relief package

Source: By Jeff Stein and Mike DeBonis, Washington Post • Posted: Monday, December 21, 2020

Senate Minority Leader Charles E. Schumer (D-N.Y.) on Capitol Hill on Tuesday.

Senate leadership announced a bipartisan deal on an approximately $900 billion economic relief package late Sunday afternoon that would deliver emergency aid to a faltering economy and a nation besieged by surging coronavirus cases.

After months of contentious negotiations and seemingly intractable partisan gridlock, both Senate Majority Leader Mitch McConnell (R-Ky.) and Senate Minority Leader Charles E. Schumer (D-N.Y.) took to the Senate floor to say that a deal had been finalized and could be quickly approved.

The emerging stimulus package was expected to direct hundreds of billion in aid to jobless Americans, ailing businesses, and a host of other critical economic needs that have grown as the pandemic ravages the country and batters the economy.

“More help is on the way. Moments ago, in consultation with our committees, the four leaders of the Senate and House finalized an agreement. It would be another major rescue package for the American people,” McConnell said. “As our citizens continue battling this coronavirus pandemic this holiday season, they will not be fighting alone.”

Schumer then took to the floor, while calling the aid package insufficient, also heralded it as a critical measure to “give the new president a boost, a head start, as he prepared to right our ailing economy.”

The House on Sunday night prepared to approve a one-day extension of government funding to allow the final bill text on the relief package to be written. The stop-gap measure would then have to be approved by the Senate and signed by President Trump to prevent a government shutdown after midnight.

Lawmakers had already finalized key economic relief measures, including stimulus checks up to $600 per person. The size of that benefit would be reduced for people who earned more than $75,000 in 2019, similar to the last round of stimulus checks, according to two people who spoke on the condition of anonymity to share details of private deliberations. The stimulus checks would provide $600 per adult and child, meaning a family of four would receive $2,400 up to a certain income.

Congress would also extend federal unemployment benefits of up to $300 per week, which could start as early as Dec. 27.

While there’s broad agreement on stimulus checks and unemployment insurance, they caution nothing is final until the bill text is released.

The income criteria for the stimulus checks is expected to reflect that of the first round of stimulus payments sent by the Treasury Department earlier this year. The size of the payment would diminish for those who earned more than $75,000 in the 2019 tax year, and disappear altogether for those who earned more than $99,000.

Adult dependents are not expected to qualify for the stimulus payments, people familiar with the negotiations said, despite a push from congressional Democrats. The deal would include stimulus payments for families in which one of the parents is not a citizen.

The deal over extending federal jobless benefits for millions of unemployed Americans at a level of $300 per week would cover up to 11 weeks of unemployment, at least through March 14, aides familiar with the negotiations said. An unemployment benefits program for contract and gig workers, which is also set to expire at the end of the year, would be extended for 11 weeks for those workers as well.

Negotiators also agreed to extend the deadline for states and cities to use unspent money approved for them by the Cares Act, two people familiar with internal deliberations said. States and cities have until the end of the year to spend billions of dollars before it expires and has to be returned to the federal government. The deal would instead extend that deadline for a full year.

Republicans have successfully opposed Democrats in their demands for hundreds of billions of dollars in state and local aid. Many local governments are experiencing steep declines in tax revenue and have been warning of layoffs. Extending the deadline for using leftover funding from the Cares Act, however, allows Democratic lawmakers to say they still provided some relief to ailing municipalities.

The agreement will also extend for one month a moratorium on evictions that is set to expire at the end of the year, two people with knowledge of the matter said. The moratorium will be extended through January, at which point Democrats believe the incoming Biden administration can extend it again if necessary. The legislation will also provide approximately $25 billion in emergency assistance to renters, the people said, although it remained unclear how that money would be disbursed.

Lawmakers had also appeared to resolve a nettlesome dispute over whether businesses that received Paycheck Protection Program loans, and had them forgiven, will be allowed to deduct the costs covered by those loans on their federal tax returns. Sen. John Thune (R-S.D.), the No. 2 ranking Republican senator, said the costs would be deductible under the final agreement.

Even if leaders are able to resolve all remaining sticking points on Sunday, it may take more time for congressional staff members to draft those agreements into legislative text and prepare the massive bill for votes in the House and Senate. Lawmakers had also not yet released text of the agreement between senior Democrats and Sen. Patrick J. Toomey (R-Pa.) over the central bank, which was a sticking point on Saturday.

The emerging legislative package is expected to also devote as much as $330 billion in small-business aid and allocate tens of billions of dollars to an array of other critical needs, such as transportation agencies, distressed renters and hungry people.

A compromise proposal reached earlier this month by Sens. Mitt Romney (R-Utah) and Joe Manchin III (D-W.Va.), among other centrist lawmakers, would have provided 16 weeks in unemployment benefits instead of the 11 weeks under the current agreement.

The push for an approximately $900 billion relief plan gained new momentum Saturday night as lawmakers resolved a dispute over a Republican plan to rein in the Federal Reserve.

As part of his proposal, Toomey wanted the Fed’s lending programs for businesses and local governments to be cut off at the end of the year, and ensure that no similar programs could be propped up down the line.

While Toomey and Republican leadership held firm for much of Saturday, Democrats chastised the plan, saying it stretched far beyond specific programs propped up under the Cares Act. They also argued the GOP was undermining the Fed’s ability to fight future crises, and with it, the incoming Biden administration.

At 12:18 a.m. on Sunday, President Trump tweeted that Congress needs to give “more money in direct payments.” The Washington Post reported last week that White House aides talked Trump out of issuing a public statement demanding stimulus checks as big as $2,000 out of fear he would sink the delicate negotiations.

Congressional lawmakers appeared ready to ignore the president’s demands. People close to negotiations said they did not expect the White House to oppose the package over Trump’s push for larger stimulus payments, although Trump has repeatedly scrambled congressional negotiations with last-minute demands.

Lawmakers have agreed in principle to new stimulus payments. Sens. Bernie Sanders (I-Vt.) and Josh Hawley (R-Mo.), as well as Trump, have made a push for more generous stimulus checks, but those efforts are unlikely to prove successful.

Rachel Siegel contributed to this report.