Legislative Update with Jay Kruse
by Jay Kruse
Chief Advocacy Officer
8/12/2020

Good Morning!

 

Over the weekend, congressional negotiations on a new coronavirus rescue package collapsed. President Trump took matters into his own hands, taking executive action in response to the ongoing COVID-19 pandemic. A considerable $2 trillion funding gap between House Democrat and Senate Republican proposals stonewalled negotiations resulting in an all too familiar partisan gridlock in Washington.

 

Below is a quick rundown of President Trump's four executive actions aimed at providing Americans some additional financial relief. As you would expect, there are still some unanswered questions related to these actions, and we anticipate additional guidance to be released throughout the next few weeks.

 

Payroll Tax Executive Action: This executive action directs the Department of the Treasury to defer the withholding, deposit, and payment of certain employee payroll taxes on wages earned through the end of the year (Sept 1st – Dec 31st).  This action only applies to taxpayers making less than roughly $100,000 per year, but may also include individuals whose base pay is under this threshold but receive bonuses that push them over the $100,000 limit. Employees would need to repay the federal government once the tax holiday ends, without further congressional action to reimburse the funds. More details here.

 

Unemployment Insurance Executive Action: The CARES Act provided a $600 per week payment to unemployment beneficiaries to supplement their regular benefit. This supplemental payment expired on July 31, 2020. This executive action will redirect federal funds to provide a $400 supplemental payment to the unemployed, and it will be a 75/25 federal-state match. Only unemployment beneficiaries receiving more than $100 in benefits per week will be eligible for this $400 supplemental payment. More details here.

 

Student Loans Executive Action: The CARES Act provides a deferment of principal and interest payments on federal student loans held by the U.S. Department of Education through the end of September. This executive action directs the Secretary to extend this deferment of both principal and interest on these loans through the end of 2020. More details here.

 

Rental Assistance Executive Order: The CARES Act implemented a rental eviction moratorium of 120 days, which applied to tenants in government-sponsored housing.  The 120-day timeframe ended on July 24, 2020. This executive order directs the Department of the Treasury and the Department of Housing and Urban Development to identify any and all available federal funds that could be directed to provide temporary financial assistance to renters and homeowners who are struggling to meet rent and mortgage obligations. This executive order also directs these federal agencies to search for ways to help tenants and homeowners avoid eviction and foreclosures, which could include providing more funding to public housing agencies and property owners or implementing another eviction moratorium. More details here.

 

President Trump didn't address some of the major concerns that the congressional proposals have flagged, including another round of $1,200 stimulus checks, school funding to aid in reopening safely, additional state and local funding, food assistance, and maybe most importantly, there were no new liability protections for businesses to encourage reopening without the fear they could spend years in court tied up in COVID related litigation.

 

Also, while the President’s recent executive actions could bring legal challenges, any such challenge would likely be a hard sell to the American people, as it could potentially be viewed as a roadblock to much-needed support for those most affected by the ongoing pandemic. Further congressional action is not anticipated in the near term, with both the House and Senate home from Washington on recess for the next month. However, Congress was told to be ready to return for a vote in the event party leaders can find a workable compromise. We continue to engage our elected officials and appreciate the opportunity to take part in the process.

 

Have a great week, stay well, and don’t hesitate to contact me with any questions.

 

 

 

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