As the full Senate is tied up with the second Trump impeachment trial, House committees are fleshing out details of the $1.9 trillion American Rescue Plan proposed by President Biden. Those details range from bolstering the Affordable Care Act to detailing the amount of aid to individual states, counties and cities, as well further direct stimulus payments, money for school reopening, relief for restaurants and transportation funding.
The action, which could result in votes this week, is consistent with having a relief package on Biden’s desk by mid-March, but not meeting Biden’s test of broad bipartisan support.
Affordable Care Act
The House Ways and Means Committee seeks to expand eligibility for fully subsidized health insurance plans to people making up to 150 percent of the federal poverty rate and limit the cost of health insurance for all Americans to no more than 8.5 percent of their income. People receiving jobless benefits also would be eligible for subsidized health insurance for a year. The House Energy and Commerce Committee wants to add incentives to states that haven’t already expanded their Medicaid eligibility. These would be the first enhancements of the ACA since its adoption during the Obama presidency.
Direct Stimulus Payments
In one of the most closely scrutinized provisions, the Ways and Means Committee proposal provides for $1,400 stimulus checks. Combined with the $600 checks Congress approved at the end of 2020, this would add up to the $2,000 amount Biden promised. Following debate over income thresholds, the House proposal offers a much steeper decline in payment amounts to households above certain income thresholds – $1,400 payments would dwindle to zero at incomes of $100,000 for individuals and $200,000 for households. The new thresholds would reduce the cost from $464 billion to $422 billion.
The Ways and Means proposal would extend until August 29 the weekly $300 weekly federal unemployment checks Congress approved in December set to expire in March. Jobless benefits also would be bumped up to $400 per week.
The House Transportation and Infrastructure Committee’s bill includes $30 billion for transit — $10 billion more than what Biden requested. The bill also calls for $8 billion through September 2024 for airports, including nearly $6.5 billion for primary airports and cargo terminals for costs including cleaning, janitorial service, personnel and debt service; $100 million for general aviation and commercial service airports that are not considered primary airports; and $800 million for airport concessions, with the bulk going to smaller concessionaires. The money will be awarded to airports that agree to maintain at least 90 percent of their concessionaire employees through September 30, 2021.
Restaurant and Small Business Relief
The pandemic-battered restaurant industry would get $25 billion in federal aid. Biden’s initial aid proposal didn’t include any direct funding specifically targeted to restaurants, but this provision, sponsored by Oregon Congressman Earl Blumenauer, was a late addition to the fast-moving package. The proposed grant program would target independent restaurants and those with no more than 20 locations. The money could be used to pay for worker salaries and benefits, mortgage, rent, utilities, supplies, food and more. The Small Business panel would allocate $15 billion in Economic Injury Disaster Loan advances for the smallest businesses suffering financial losses from the pandemic.
Child Care Tax Credits
The Ways and Means package would significantly expand three existing tax credits for 2021 – two for defraying the cost of children and another for lower-income childless workers, at a cost of $143.5 billion. Child tax credits would go from $2,000 per child to $3,000 and to $3,600 for children under 6 years of age. They would be made fully refundable for lower-income workers who don’t have enough tax liability to benefit from the full credit in current law. Those changes are the most expensive of the three credit expansions, at $109.5 billion.
Separate tax credits for child and dependent care expenses would be recast as more of a middle-class benefit, by increasing the income threshold to receive the full credit to $125,000 instead of the current $15,000, though it also would become fully refundable. And the maximum credit would jump from 35 percent of expenses up to $3,000 per dependent — capped at $6,000 — to 50 percent of expenses worth up to $16,000 for two or more dependents. The 50 percent credit would slide down to 20 percent after $125,000 and then start phasing out completely after $400,000. The measure would also nearly triple the maximum earned income tax credit for childless adults, to $1,500 a year, while reducing the minimum age to claim the credit from 25 to 19 and increasing the income amounts above which the credit starts to phase down.
Draft legislation released by the House Education and Labor Committee, provides $128.6 billion to help K-12 schools safely reopen, a major priority of Biden’s first 100 days. The funding would shore up personal protective equipment, COVID-19 testing and school ventilation systems, as well as allow for smaller class sizes to facilitate social distancing. It also would require that 20 percent of the funding is used to address accumulated learning loss during months of virtual schooling.
The House Education and Labor Committee’s proposal includes a transition of the federal minimum wage to $15 per hour by 2025, including youth workers, tipped workers and workers with disabilities. Workers also would be aided through $150 million to the Labor Department to implement COVID-19 worker protection programs, including $75 million for the Occupational Safety and Health Administration. The plan that more than doubles the federal minimum wage over five years would increase federal deficits by $54 billion over a decade, the Congressional Budget Office said Monday. Biden said Friday he expects this measure to encounter a procedural challenge in the Senate under budget reconciliation rules. Senator Bernie Sanders, chair of the Senate Budget Committee, disagrees.
Funding for State, Local and Tribal Governments
The House Committee on Government Oversight and Reform has outlined how $350 billion in state and local funding that Biden proposed would be disbursed:
Sixty percent of the funds would go to states and 40 percent to local governments, which of every size would receive dedicated allotments. Funds are available until expended, awarded directly from Treasury within 60 days of enactment, and subject to eligible uses including to replace revenue lost, delayed or decreased as a result of the pandemic.
- States and the District of Columbia: $195.3 billion
- $25.5 billion equally divided – every state receives at least $500 million
- $169 billion based on the state share of total unemployed workers
- The District of Columbia would be made whole after being treated as a territory in previous coronavirus funding Acts
- Local governments: $130.2 billion divided evenly between cities and counties.
- $65.1 billion to cities using a modified Community Development Block Grant formula
- $45.57 billion for municipalities with populations of at least 50,000
- $19.53 billion for municipalities with populations of less than 50,000
- $65.1 billion to counties based on population
- Territories: $4.5 billion
- $2.25 billion divided equally and $2.25 billion based on population
- Tribes: $20 billion to federally recognized tribal governments.
- $1 billion divided equally among tribes
- $19 billion divided as determined by the Secretary of the Treasury
Spreadsheets shared by the committee detailed how much individual states and cities would receive directly. In round numbers, Oregon would receive $314 million, Portland $201 million, Eugene $33 million, Salem $30 million, Medford $17 million and Beaverton $16 million.