Congressional leaders said Wednesday that they are nearing agreement on a roughly $900 billion economic relief package that would include a second round of stimulus checks and could be completed by the end of this week.
The package emerging is expected to include hundreds of billions of dollars in aid for ailing small businesses and jobless Americans; tens of billions of dollars in aid for other critical needs, such as vaccine distribution and schools; and a one-time check of between $600 and $700 for millions of Americans below a certain income threshold.
The relief bill probably will be coupled with several other major efforts—from legislation to fund federal agencies to a bipartisan effort to rein in surprise medical billing—that lawmakers could then pass into law in a matter of days.
Lawmakers are racing to pass a deal in part because of widespread signs of economic deterioration in the face of the resurgent pandemic, as well as the imminent expiration of several critical federal aid programs by the end of the year. Nearly 8 million Americans have fallen into poverty since this summer, according to a new report, in part because emergency benefit programs expired. More Americans are filing for unemployment benefits, and the pace of hiring has slowed.
To avoid a shutdown of the federal government, Congress must pass a new spending bill by midnight Friday. Aides said lawmakers could pass another short-term extension of government funding to buy negotiators more time to strike a deal.
Tensions over the new package flared in the final stages of negotiations, with Sens. Bernie Sanders, I-Vt., and Joe Manchin, D-W.Va., engaging in what aides described as a heated exchange during an internal conference call Wednesday afternoon. Sanders pushed for the package to include bigger aid checks. Manchin has said unemployment benefits are more essential, and he helped lead a bipartisan compromise Sanders has derided as insufficient. Because lawmakers are trying to move the bill quickly, Sanders’s opposition could be enough to blow the whole deal up, infuriating members who are trying to rush the deal into law.
But it is these changing political dynamics that have opened the door for a potential agreement. Congressional Democrats had sought a much larger stimulus package before the election. Many, however, have now softened their position after President-elect Joe Biden’s victory, which could help secure some immediate relief. Leadership negotiations were revived by bipartisan legislation released this week, led by a team including Manchin and Sens. Mark Warner, D-Va., and Mitt Romney, R-Utah. The final bill is expected to closely mirror their initial proposal.
As the bills took shape, House Speaker Nancy Pelosi, D-Calif., hosted hours of meetings on Tuesday with the three other most senior congressional leaders—Senate Majority Leader Mitch McConnell, R-Ky., Senate Minority Leader Chuck Schumer, D-N.Y., and House Minority Leader Kevin McCarthy, R-Calif. Negotiators have described those talks as productive.
“The stimulus package is encouraging. It looks like it’s very, very close,” Biden said in Wilmington, Del., on Wednesday. “It’s a down payment. An important down payment that’s going to have to be done. . . . It’s very important to get done.”
House Majority Leader Steny Hoyer, D-Md., told reporters Wednesday afternoon that he is hoping for a deal “later today or early tomorrow morning.”
Even if negotiators reach a deal Wednesday, clearing it through Congress by the Friday midnight deadline could be a heavy lift. The House could vote as soon as Thursday, waiving its usual three-day rule for the review of legislation. The Senate would then have to secure unanimous consent among its 100 members to skip procedural hurdles and move to a final vote before the deadline. An objection from Sanders or any other senator could cause a brief government shutdown unless lawmakers agree to another short-term funding bill.
The emerging stimulus package is expected to include a new round of funding for the Paycheck Protection Program, which faced criticism for giving government aid to large corporations, as well as targeted relief for other ailing business sectors. It will also include $300 per week in supplemental federal benefits for more than 10 million jobless Americans, according to Sen. John Thune, R-S.D., the number two-ranking Republican senator.
Democrats also secured $25 billion to establish a new program to provide emergency rental assistance, funding that could be used to cover past and future rent payments, as well as other related expenses, Schumer told Senate Democrats on a video call Wednesday, according to a Democratic official familiar with his remarks.
Some key parts of the bill have shifted in the past few days. The initial $908 billion bipartisan proposal, released this week by the group of moderates, would have not authorized another round of stimulus checks. Negotiators had tried to keep the bill’s cost below $1 trillion to maintain Republican support for the effort. The bill would have included money for state and local governments.
But state and local relief funding appeared to fall out of the deal Wednesday because lawmakers were unable to reach a compromise on coronavirus-related liability protections for corporations.
Slashing aid for states and cities from the emerging deal would free up close to $160 billion in funds that could be reapportioned for the direct payments. Using this pool of money, lawmakers have attempted to finance stimulus checks that are roughly half the size of the $1,200 checks approved in March, or $600 per person. Discussions were ongoing on Capitol Hill about the exact size of the payments. Some of the $160 billion could also be used to expand funding for vaccine distribution, people involved in the discussions said.
The potential inclusion of stimulus checks came after a push from Sanders and Sen. Josh Hawley, R-Mo., who threatened the government spending legislation to ensure a vote on a second round of stimulus checks. President Donald Trump has also pushed for another round of stimulus checks to be included in the final package, as have some left-leaning lawmakers in the House. Treasury Secretary Steven Mnuchin had proposed including $600 stimulus checks in the package last week, but Democrats opposed the measure then because the White House wanted to slash unemployment aid as well.
“I would say that that’s progress. It’s not where I would like it to be,” Hawley told reporters of the bill under development Wednesday.
Sanders also praised the inclusion of $600 checks as a “good start,” but he added: “I’m going to continue to fight for more.”
The addition of the stimulus checks is expected to come in part by reducing the amount of unemployment aid. Congressional leadership has told other lawmakers that they are planning on reducing the number of unemployment benefits by one month from the bipartisan plan, according to two people who spoke on the condition of anonymity to share private remarks. That could mean that the extended benefits would expire at the end of March. Such a timeline could force the incoming Biden administration to move more quickly in its effort to pass a massive stimulus bill early next year. Sen. Ron Wyden, D-Ore., the ranking Democrat on the Senate Finance Committee, panned the cut to unemployment benefits as “robbing Peter to pay Paul.”
Thune also suggested to reporters that lawmakers want to prevent people from receiving a combination of federal unemployment benefits and a direct payment, calling that a potential “double benefit.”
Failure to approve new aid for state and local governments could also come at a perilous time for municipalities across the country. One person familiar with negotiations said the agreement would include “other avenues to deliver aid” to states, cities, territories, and tribes, but the person did not provide specifics. Two other aides said lawmakers have discussed approving $90 billion for the Federal Emergency Management Agency that could then be distributed to states and cities. Thune said many GOP lawmakers would oppose that provision if “it’s simply a way of disguising money for state and local governments.”
The legislative push was expected to include other priorities unrelated to the relief package. Along with the $900 billion legislation, lawmakers are expected to approve $1.4 trillion to fund the federal agencies; tens of billions of dollars in extensions to expiring tax provisions; numerous trade provisions; and a bipartisan energy bill written by Manchin and Sen. Lisa Murkowski, R-Alaska, among other potential measures.
The bipartisan compromise on medical billing that lawmakers are working to include in the bill has been in development for more than a year, pitting insurance companies against private equity firms and doctors’ groups in an expensive public relations and lobbying battle. The legislation requires providers and insurers to negotiate directly, working with independent arbitrators to settle disputes. That approach, favored by the doctors and their financial backers, was chosen instead of a system of “benchmarking” prices to the rates insurers pay to providers already in their networks.