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Smaller $748 billion federal emergency aid package may pass

“Undoubtedly, depending on the course of this pandemic, we may have to do more,” Sen. Susan Collins, R-Me., said Monday at a news conference held by a group of bipartisan lawmakers.

Bloomberg News

Emergency federal aid for coronavirus vaccine distribution, schools, transit, airports, small business and the unemployed are contained in a $748 billion bipartisan congressional package unveiled Monday.

But the $160 billion that the group proposed in direct aid for state and local governments has been broken out of their original $908 billion package unveiled earlier this month and paired with temporary liability protections in a separate bill that faces an uncertain future.

That $160 billion would include an $8 billion carve-out for tribal governments with the remaining $152 billion distributed through the Coronavirus Relief Fund with one third based on each state’s proportion to the U.S. population and two thirds based on the proportion of each state’s revenue losses relative to the total revenue losses of all states nationwide. Each state is entitled to a minimum of $500 million.

Governors must distribute 40% of the state’s funding to local governments. There are no population thresholds so every county and municipality would be eligible for funding regardless of size.

Loss of that direct aid would be a setback for state and local governments that have seen the next proposed installment of federal aid continually shrink since enactment of the CARES Act in March.

On the positive side, there are important pieces that could be enacted this week, including a new installment of $25 billion in rental assistance to states and local governments and Native American tribes through the Coronavirus Relief Fund.

The cost of the package is reduced by reallocating $429 billion in unused Treasury direct loans and excess funds from Federal Reserve facilities authorized in March under the CARES Act.

The bipartisan group of congressional lawmakers who announced their new two-pronged proposal Monday said it was outlined in legislative language ready for a vote on the Senate and House floor.

“This is our consensus bill,” said Sen. Richard Durbin, D-Ill. “We all agree on it. It's ready to go."

Republican Sen. Susan Collins said that although the package is comprehensive, it does not cover everything and many of the measures only run until April. “Undoubtedly, depending on the course of this pandemic, we may have to do more,” she said. “But surely we can come together and provide this relief before we break for the Christmas holiday. The American people deserve no less.”

The $82 billion for schools and $45 billion for transportation that’s part of the larger $748 billion emergency aid bill could be paired with an omnibus 2021 spending package that could clear the House and Senate by this weekend.

The $1.4 trillion omnibus will cover federal government operations through the Sept. 30 end of the current fiscal year, clearing the way for state and local governments to receive their normal annual allocations for a wide range of federal programs.

The $82 billion for education includes $54 billion for an elementary and secondary school emergency relief fund; $7.5 billion to be distributed through the CARES Act Governors Emergency Education Relief Fund that includes a $2.5 billion set aside for private elementary and secondary schools; and $20 billion for a Higher Education Emergency Relief Fund.

The $45 billion in emergency aid for transportation includes $15 billion for transit agencies, $4 billion for airports with a special set aside for concessionaires, $1 billion for Amtrak, and $8 billion to support the motor coach and bus industry.

The Small Business Administration would get $300 billion to allow the hardest-hit small businesses to receive a second forgivable Paycheck Protection Program (PPP) loan.

Other parts of the emergency aid bill include $6.25 billion for State Broadband Deployment and Broadband Connectivity grants and $3 billion for an Emergency Educational Connectivity Fund to provide E-Rate support to educational and distance learning providers to provide hotspots, devices, and other connected devices.

And there’s much-needed funding for state and local governments to distribute COVID-19 vaccines. It includes $7 billion for testing and tracing, $3.42 billion for tracking systems and data modernization, and $2.58 billion for vaccine distribution.

An additional $35 billion would go to a health Provider Relief Fund and $3.15 billion for the Substance Abuse Prevention and Treatment Block Grant, the Community Mental Health Services Block Grant, tribal programs, peer recovery programs, and suicide prevention efforts.

The emergency aid includes a 16-week extension of federal supplemental unemployment insurance benefits expanded at $300 per week from the end of December into April.

There’s also a 15% increase in the individual monthly Supplemental Nutrition Assistance Program allocation for four months that could serve as pressure relief for hard-pressed local food banks and food pantries. In addition, there’s more funding for the Special Supplemental Nutrition Program for Women, Infants, and Children (WIC) and the Meals on Wheels program for senior citizens.