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COVID-19 Update | Thursday, July 23

July 23, 2020

Congress

The House and Senate are both in session.

General Congress

  • Negotiations on the next COVID-19 package continue to progress slowly. Portions of the potential Republican proposal are emerging, but no official policy provisions outside the $105B for schools we reported on yesterday have been released. Bipartisan negotiations among Congressional leaders are expected to begin in earnest next week, though House Speaker Nancy Pelosi (D-CA) met with Senate Minority Leader Chuck Schumer (D-NY), Treasury Secretary Steven Mnuchin and White House Chief of Staff Mark Meadows earlier this week.
    • Senate Republicans and White House officials discussed extending the $600 per week unemployment benefits, which are expiring at the end of this week. However, White House Chief of Staff Mark Meadows said that the Administration is opposed to renewing the unemployment benefits.
      • It is expected that Congress will extend the unemployment benefits in some fashion, but with the benefits being significantly reduced from $600 each week.
    • Additionally, Senate Majority Leader Mitch McConnell (R-KY) has not said whether the payroll tax cut will be included in the next relief package, despite comments from other Republican leadership stating it would not be included.
  • Though legislative text was originally expected to be released as early as today, that timeline has slipped to Monday. According to a document attributed to Senate Republicans outlining the Senate Republican and White House agreement, the following has emerged in terms of what might be in the package, but the authenticity of the document has not been verified and therefore everything remains subject to change:
    • $302.8B topline from the Appropriations Committee
    • Additional direct payments to Americans with more limited criteria than under the CARES Act
    • Additional Paycheck Protection Program (PPP) funding for businesses with under 300 employees or that meet Small Business Administration (SBA) size standards and can show revenue loss of at least 50%, a more streamlined forgiveness process for loans under $150,000 and an intermediate loan forgiveness process for loans under $1M
      • The loans will be calculated similarly but with a smaller cap
    • Tax provisions including:
      • Enhanced employee retention tax credit
      • Tax deductions for employer purchases of testing, personal protective equipment (PPE), and certain other supplies
      • Increasing the business meal deduction from 50% to 100%
    • Liability protections including:
      • Exclusive federal cause of action that applies to litigation against any business, non-profit, school, medical provider, or medical professions arising from COVID-19
      • Cases can be brought in state or federal court, but this cause of action is the only standard of liability that applies either way
      • Defendants have the right to remove any case filed in state court to the federal district court in that area
      • To prevail, plaintiffs must show that the defendant was grossly negligent or engaged in willful misconduct and violated relevant state/local public health guidelines in place at the time the incident occurred
        • There is a cap on damage awards
    • State and local relief including:
      • Currently no additional funds provided, though Republicans expect additional funds to be added during negotiations with Democrats
      • State/local governments can use CARES Act money to make up lost revenues
        • 15% of state CARES Act funds must be given to local governments (there is still 45% suggested in the Treasury Department guidance, but the 15% will be legally enforceable)
      • The date for using the money is extended from December 30, 2020 to 90 days after the end of the fiscal year (FY)
        • No funds can be used for pensions or retirement benefits
      • No funds can be used to replenish a state or local emergency (rainy day) fund
      • States must maintain their own budgeted spending levels meaning federal funds cannot be used to replace state spending
      • States may not impose any restrictions on the use of CARES Act money by their local governments other than those set in the CARES Act and associated Treasury Department guidance

Senate

  • The Senate passed S. 4049, the National Defense Authorization Act (NDAA) for FY 2021 in an 86-14 vote.
    • In addition to the amendments considered this week under an agreement before the July 4 recess, the Senate was set to include 40 bipartisan amendments by unanimous consent. However, Sen. Mitt Romney (R-UT) objected to the unanimous consent request when his amendment, which would have blocked troop reductions in Germany, was not included.
  • Sens. Ted Cruz (R-TX) and John Cornyn (R-TX) introduced The Ensuring Public Safety’s Access to Airwaves Act, S. 4234. This legislation would require the Commerce Department to identify government-held airwaves that could be reallocated to the private sector and would safeguard the T-Band.
  • Sens. Thom Tillis (R-NC), Lindsey Graham (R-SC), Susan Collins (R-ME), Lisa Murkowski (R-AK), Cory Gardner (R-CO), Martha McSally (R-AZ) and Richard Burr (R-NC) sent a letter to Senate Majority Leader Mitch McConnell (R-KY) asking for the clean energy sector to be prioritized for assistance in the next COVID-19 package.
  • Sens. Lindsey Graham (R-SC), Shelley Moore Capito (R-WV) and Mike Rounds (R-SD) introduced the U.S. MADE Act of 2020, which requires the Department of Defense to give preference in procurement to U.S.-made textile products and other items. Additionally, the bill requires PPE acquisition requirements for the Strategic National Stockpile and establishes a 30% investment tax credit for PPE manufacturing projects. A press release on the legislation can be found here.
  • Foreign Relations Chairman Jim Risch (R-ID) and Sens. Todd Young (R-IN), Cory Gardner (R-CO) and Mitt Romney (R-UT) introduced the Strengthening Trade, Regional Alliances, Technology and Economic and Geopolitical Initiative Concerning China (STRATREGIC) Act. The bill would create a strategy for how the United States should compete with China, on issues including technology innovation. A press release on the legislation can be found here and bill text can be found here.
  • Members of the Senate Commerce, Science, and Transportation Committee will receive an unclassified briefing on the July 15 Twitter hack which targeted many verified accounts, including 2020 Democratic Presidential Candidate Joe Biden.
  • The Senate Commerce, Science and Transportation Subcommittee on Security will host a hearing titled “The China Challenge: Realignment of U.S. Economic Policies to Build Resiliency and Competitiveness,” on July 30. The witnesses for the hearing will be:
    • The Honorable Nazak Nikakhtar, Assistant Secretary for Industry and Analysis, International Trade Administration, U.S. Department of Commerce
    • Dr. Rush Doshi, Director of the Chinese Strategy Initiative, The Brookings Institution
    • Mr. Michael Wessel, Commissioner, U.S.-China Economic and Security Review Commission

House

  • The House began considering the 132 amendments to the first appropriations minibus, H.R.7608, which includes the Agriculture-Food and Drug Administration-Rural Development, Interior-Environment, Military Construction-Veterans Affairs and State-Foreign Operations measures. Some of the amendments include:
    • The doubling of funding for lead drinking water pipeline replacements to $1B by Rep. Rashida Tlaib (D-MI)
    • Prevention of funds to be used to implement the Trump Administration’s revisions to the National Environmental Policy Act (NEPA) by Rep. Debbie Dingell (D-MI)
    • A measure that would prevent the federal government from entering into any contract or agreement with Trump-affiliated businesses by Rep. Steve Cohen (D-TN)
    • An amendment to bar the leasing of oil and gas fields in the Arctic National Wildlife Refuge by Rep. Jared Huffman (D-CA)
  • The amendment deadline for the second appropriations minibus, H.R.7617, was today. 214 amendments have been offered to date. As a reminder, H.R. 7617 includes the Defense, Commerce-Justice-Science, Energy and Water Development, Financial Services and General Government, Homeland Security, Labor-Health and Human Services-Education, and Transportation, Housing, and Urban Development measures.
    • The House Rules Committee will meet on the minibus on Monday, setting the legislation up for floor consideration later next week.
  • The Congressional Hispanic Caucus (CHC) announced its support for the House Homeland Security FY 2021 appropriations bill in a Dear Colleague letter.
    • As we reported yesterday, the Congressional Progressive Caucus released a statement calling on House leadership to pull the House FY 2021 Homeland Security appropriations bill from floor consideration amid concerns over law enforcement and protestors.
  • Judiciary Committee Ranking Member Jim Jordan (R-OH) wrote a letter on Wednesday to Chairman Jerry Nadler (D-NY) in which he urged the invitation of Twitter CEO Jack Dorsey to participate in a July 27 Subcommittee on Antitrust, Commercial, and Administrative Law hearing that will feature the CEOs of Google, Apple, Facebook and Amazon.

Administration

  • As we reported yesterday, the Environmental Protection Agency (EPA) proposed setting a fuel efficiency standard for aircraft engines, which would bring the U.S. in line with standards set by the International Civil Aviation Organization (ICAO) in 2017. The proposed rule would allow the EPA to certify engines made by Boeing or other U.S. aircraft makers as compliant with ICAO standards. The technical analysis conducted by the EPA noted that this rule would not lead to a reduction of greenhouse gases.
  • The Department of Labor reported that unemployment claims rose to 1.4M last week, which ended fifteen straight weeks of declines in new unemployment applications.
  • President Donald Trump announced that the Republican National Convention would no longer take place in-person in Jacksonville, Florida. Trump said he would still deliver a campaign speech in a different form, but there would not be a “big crowded convention.”
  • Employees of Immigration and Customs Enforcement (ICE), CBP, and TSA have sued the Trump Administration, claiming that they did not receive the hazard pay they were entitled to for potentially being exposed to COVID-19 while on the job.
    • As a reminder, we have previously reported that many TSA agents have contracted COVID-19 and that the TSA has urged the Administration to strongly encourage more face covering usage in airports.
  • The FCC launched the first auction of the 3.5 GHz band. 271 applicants, including AT&T, Cox, Shenandoah Cable TV, Cable One, USSC, Verizon, and Windstream, won the right to bid.
  • The Internal Revenue Service (IRS), reported that they have recovered 70% (more than $1B), from inaccurate stimulus payments that were sent out since the CARES Act. The IRS sent more than 1M stimulus payments to deceased people, which totaled about $1.6B.
  • The Federal Transit Administration (FTA) announced that they will host monthly listening sessions for the transit community to help facilitate recovery from the COVID-19 pandemic. The schedule and topics for the listening sessions are below:
    • Friday, July 31, 2020, from 2:45-3:45 PM EDT: Supporting the Health, Safety, and Confidence of Transit Riders
    • August 2020: Maintaining Healthy Operations and Keeping Transit Workers Safe
    • September 2020: Managing Vehicles and Facilities in a New Service Environment
    • October 2020: Innovations in Restoring Passenger Confidence and Managing COVID-19 Operational Considerations
    • November 2020: Value-Added Services for Public Transportation as Communities Recover
    • December 2020: Understanding and Addressing Changing Rider Needs
  • Federal Register Notices:
    • The Department of Transportation (DOT) issued a final notice on National Transit Database reporting changes and clarifications. The notice can be found here.
    • The Pipeline and Hazardous Materials Safety Administration (PHMSA) issued correcting amendments to the Safety of Underground Natural Gas Storage Facilities Rule. The notice can be found here.
    • The State Department issued a notice of an update to Section 232 of the Countering America’s Adversaries Through Sanctions Act of 2017. The notice can be found here.
    • The Office of the United States Trade Representative (USTR) issued a notice of product exclusions on China’s acts, policies, and practices related to technology transfer, intellectual property, and innovation. The notice can be found here.

Other News

  • The U.S. has reached 4M COVID-19 cases, double the 2M cases from only six weeks ago. On Wednesday, more than 1,100 deaths from COVID-19 were reported, the most since May 29.
  • Digital rights groups Fight for the Future and the Ban Facial Recognition Coalition are urging lawmakers to support the Facial Recognition and Biometric Technology Moratorium Act (H.R. 7356, S. 4084), which would stop the Federal government’s use of facial recognition in the U.S.
    • H.R. 7356 currently has nine cosponsors in the House and S. 4084 has four cosponsors in the Senate.
  • A new study released Wednesday by a coalition of climate organizations and Universities narrowed the range of possible temperature increases from rising greenhouse gas levels, eliminating both the worst and best outcomes. The study concluded that it was likely the world would not avoid warming beyond two degrees Celsius if carbon dioxide concentrations double the pre-industrial levels or that the temperature would rise beyond 4.5 degrees Celsius. The study can be found here.
  • The Shipbuilders Council of America appealed to Congress for additional funds to help shipyards and ports handle the economic impacts of the COVID-19 pandemic. Matthew Paxon, the council’s president, warned that without adequate funding, the shipyard industrial base of America might degrade.
  • A new coalition of state officials, industrial and power companies, and environmental and labor organizations is launching the Industrial Innovation Initiative to decarbonize crucial industrial sectors. They sent a letter to Congressional leadership in which they outlined eight policy recommendations for the next COVID-19 package.
  • U.S. airlines have become increasingly vocal about the newly implemented procedures that will mitigate passengers’ chances of contracting COVID-19.
    • On Wednesday, Delta Airlines CEO Ed Bastian noted that the airline is blocking middle seats and sanitizing all surface areas of the plane prior to passengers boarding.
    • United Airlines CEO Scott Kirby said during an earnings call Wednesday that an aircraft is a “uniquely safe environment.” In that same earnings call, United officials conceded that they expect passenger revenue to be down 83% in the third quarter of 2020 compared to 2019. As a reminder, United also required passengers to wear face coverings at all times in the airport and on the aircraft.
    • Southwest and American Airlines both announced that any individual over two years old will have to wear a face covering in the airport terminal and on their flight.
  • Officials for the Metro Transit Authority (MTA) of New York City announced that the organization has faced significant financial challenges since the start of the COVID-19 pandemic and are looking to the Federal government for help in the next COVID-19 package.
    • As a reminder, a statewide coalition of eighteen Republican lawmakers sent a letter to Senate Majority Leader Mitch McConnell (R-KY) urging for more aid in the next COVID-19 package last month. MTA received $3.9B in aid in the CARES Act.
  • The Organization for Economic Cooperation and Development’s (OECD) director for tax policy, Pascal Saint-Amans, said that the organization will present blueprints of their digital tax proposal by October. The proposal will issue guidance on how countries can properly tax multinational online companies and set a minimum tax across the world. This effort has been spurred by the concern that large multinational tech companies – such as Apple, Google, Netflix, and Amazon – are not paying enough taxes in places where they have users and customers.
  • France will phase out all 5G equipment from Chinese company Huawei by 2028, according to a report from Reuters.
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