The US Congress is preparing to send President Joe Biden an enormous $1.9 trillion economic stimulus and COVID-19 relief package that policymakers hope will set the stage for a recovery from the devastating coronavirus pandemic in the United States.
The bill provides direct payments to individual US citizens, tax credits for families with children, and hundreds of billions in bailouts for state and local governments, pension funds, small businesses, public schools, and healthcare providers.
US Treasury Secretary Janet Yellen said on Monday the bill should help the US return to “full employment” next year.
“We have a K-shaped recovery going on, in which high-income people are doing much better than those at the bottom of the economic ladder – low-wage workers and minorities,” Yellen said in an interview on the MSNBC news outlet.
House of Representatives Speaker Nancy Pelosi told reporters at the Capitol on Monday the House would likely vote on the bill on Wednesday.
Here are highlights of what is in the COVID-19 relief bill passed by the Senate on March 6 and now awaiting final passage by the US House of Representatives.
$1,400 direct payments
The bill provides for an estimated $225bn in one-time, direct payments of up to $1,400 for middle and lower-income Americans. Eligibility was narrowed for the cheques to limit them for individual taxpayers making $80,000 a year or less.
Payments would start to be distributed by the US Treasury to an estimated 160 million US citizens within a matter of days after the bill becomes law.
The bill continues federal pandemic unemployment aid of $300 a week paid on top of state jobless benefits. It avoids the expiration of those benefits on March 14 and extends them through September 6. Biden’s initial proposal had been to increase federal unemployment aid to $400 a week from the present $300 a week, but that was cut back on concern it would make it harder for businesses to hire back laid-off workers.
Aid to state and local governments
The bill includes $350bn for fiscal aid to states and cities and tribal governments to cover extra costs and revenue shortfalls incurred during the pandemic. The revised Senate bill seeks to limit how the funds are used, prohibits bailouts of public pension funds and assures smaller states will get their fair share of the funding.
The bill provides $130bn in funding for primary and secondary public schools across the next three years to begin to reopen and recover from shutdowns that have caused US students to lose up to a year of their education.
Child poverty reductions
The bill seeks to reduce child poverty, which had worsened during the pandemic, by expanding the federal child tax credit. The credit is available for taxpayers earning up to $200,000 a year who have a child living in their household for at least half the year. The bill increases the child tax credit to $3,000 from $2,000 and allows it to be paid by the IRS in cash during the second half of the year.
No minimum wage increase
The bill does not include an increase in the federal minimum wage of $7.25 an hour last set in 2009. The minimum wage varies from state to state but must at least equal the federal standard. The US House of Representatives had approved an increase in the federal minimum wage to $15 an hour, but the provision lacked sufficient support in the Senate to overcome procedural hurdles and was removed.
Health insurance subsidies
The bill includes subsidies for health insurance for people who have lost jobs. Under existing US law, those who lose their jobs can remain on their company’s health plan for up to 18 months. The COVID-19 relief bill would provide those people a 100-percent monthly subsidy through the end of September. It also expands the availability of health insurance plans on government-mandated exchanges under the Affordable Care Act.
Vaccines, testing and tracing
The legislation includes $14bn for distribution and supplies of vaccines as the Biden administration pushes to get every US adult vaccinated by the end of May. It also includes $8.5bn for rural healthcare providers, $45bn in rental and mortgage assistance and extends a federal moratorium on evictions through September, and $30bn for public transit agencies.
The legislation also provides continuing funding for the federal government’s Paycheck Protection Program, which gives subsidies to small businesses that pledge to keep employees on their payroll.