COVID-19 Update | Friday, April 24
April 24, 2020
- There remains disagreement over what the next legislative step will be in response to the COVID-19 pandemic. Democrats continue to want to push forward with large packages while most Republicans want to evaluate the effectiveness of the funding to date. Conversations continue about a stimulus-like package but what it will end up including remains unclear.
- Elevate believes that there will be a stimulus-like package, but timing and content will be driven by external factors such as the economy, infection and recovery rates etc. Most Republicans have expressed concern at continued spending and increasing the Federal debt. Early today, Senate Majority Leader Mitch McConnell signaled that the trend of legislating federal spending by unanimous consent to respond to the COVID-19 pandemic is over, indicating that further spending will have to come via the regular legislative process. This will slow down additional packages.
- Democrats still would like to see, and are continuing to work toward, a broad legislative measure for the May/June timeframe that would include significant infrastructure funding.
- The Congressional Budget Office (CBO) released their “Current Projections of Output, Employment, and Interest Rates and a Preliminary Look at Federal Deficits for 2020 and 2021.” CBO projects real GDP to decline by about 12 percent during the second quarter, equivalent to a decline at an annual rate of 40 percent for that quarter, while the unemployment rate is expected to average close to 14 percent during the second quarter and the federal budget deficit is projected to be $3.7 trillion. This information likely will be utilized by both parties to advance their positions going forward. The report can be found here.
- The White House has signaled that a broad infrastructure package may not be viable to enact this year; however, the Administration has indicated support for, at minimum, building out and funding 5G cellular technology and broadband access.
- President Trump signed the $484 billion H.R.266 – Paycheck Protection Program and Health Care Enhancement Act today.
- The Paycheck Protection Program (PPP) will restart processing payments on Monday following the passage of the law, which provides an additional $320 billion for the program after it had reached its previous cap of $350 billion late last week.
- The Office of the US Trade Representative (USTR) is expected to notify Congress in the coming days that it expects to implement the US-Mexico-Canada Trade Agreement on July 1. An entry into force at a midyear point has been a point of contention between the Administration and business leaders due to concerns about major supply chain disruptions.
- USTR also issued further tariff exemptions for 108 items from Chinese import tariffs under section 301. These items include many medical-related goods in addition to other products. The exclusions will apply retroactively to September 24, 2018 and until August 7, 2020. The full list can be found here.
- The Federal Aviation Administration (FAA) has selected 115 air traffic control towers that are being considered for hours reductions due to reduced flight volumes related to COVID-19 shutdowns. The cuts span from only one hour to up to 16-hour reductions in operating schedules.
- The Trump Administration is now allowing government-owned public hospitals and small casinos to seek new small business loans. Rural providers, in addition to small casinos, have struggled immensely after being restricted from the initial loan programs (such as the PPP), but the Small Business Administration (SBA) clarified on Friday that the groups are now eligible after advocacy efforts from industry groups.
- The National Park Service (NPS) announced $7.7 million in grants for the preservation of Historically Black Colleges and Universities. NPS awarded the grants to 18 projects in 12 states. A full list can be found here.
- The Association of Flight Attendants has asked the Federal Government to mandate airline crew members and passengers to wear masks at airports and on planes.
- General aviation pilots are asking for regulatory relief from the FAA. The FAA is reportedly working on a Special Federal Aviation Regulation and pilots and lawmakers are pushing for exemptions and extensions on a host of different requirements, including paperwork inspections and re-examination flights, in light of the pandemic.
- The Federal Trade Commission (FTC) today announced it has sent 10 letters warning multi-level marketing companies (MLMs) to remove and address false claims that they or their participants are making about their products’ ability to treat or prevent coronavirus disease. More information can be found here.
- The Internal Revenue Service (IRS) and Department of the Treasury have delivered Economic Impact Payments to 88 million Americans so far, totaling $158 billion in the first three weeks of the program.
- Federal Register Notices
- The General Services Administration (GSA) is suspending certain provisions related to relocation travel for employees relocating during the pandemic. The full notice can be found here.
- The Secretaries of Defense and Homeland Security have extended National Guard support for certain states at a full federal cost share. The full notice can be found here.
- The Federal Reserve has updated their Frequently Asked Questions on the Commercial Paper Funding Facility (CPFF), which can be found here.
- The trucking industry continues to combat a myriad of inconsistent state decisions on interstate operations. In particular, the industry is facing issues with Department of Motor Vehicle (DMV) closures, training center closures, rest stop closures, and other logistical hurdles.
- The FAA plans to continue issuing guidance on how air travelers and workers should protect themselves from COVID-19. Airlines have provided options already, including mandatory personal protective equipment, fewer in-person checks, airport testing, and plane capacity limits well below current levels. Airline executives, amid calls for protective gear from employee union groups, have acknowledged that changes need to be made. The FAA has not given any indication of its plans.
- Small airlines, fueling stations, and flight schools, have signaled that more relief will be needed to shoulder the burden of dramatically reduced air travel.
- Norwegian Cruise Line has announced that it is extending its suspension of embarkations to June 30th, intending to restart operations on July 1st. Several other cruise lines owned by Norwegian and Carnival have made similar announcements.
- 2020 was the first year that Amtrak expected to break even on its operations. Due to the pandemic, Amtrak has suffered a 95 percent decrease in ridership, which will lead to a projected $700 million shortfall for the year. Six of Amtrak’s lines have stopped running all together.