COVID-19 Update | Tuesday, Aug. 11
August 11, 2020
The Senate is technically in session, but most Senators are back in their home states and no votes are scheduled. The House is in recess. Lawmakers in both chambers have been instructed to be prepared to return to vote on a potential COVID-19 relief package.
COVID-19 Relief Negotiations
- Negotiations continue to be stalled. As of this writing, the four negotiators – White House Chief of Staff Mark Meadows, Treasury Secretary Steven Mnuchin, Senate Minority Leader Chuck Schumer (D-NY) and House Speaker Nancy Pelosi (D-CA) – are not expected to meet today or tomorrow. In fact, Chief of Staff Meadows is not even in the Washington D.C. area. We now believe it is highly unlikely that a deal is agreed upon this week.
- There is broadening recognition that Congress is likely to delay passing COVID-19 relief until later this August at the earliest.
- As an additional consideration, government funding runs out at the end of September, which could add a separate issue if Congress is unable to reach an agreement on additional COVID-19 relief this month.
- Speaker Pelosi and Minority Leader Schumer have voiced opposition to combining Fiscal Year (FY) 2021 government funding and COVID-19 relief discussions, believing that relief must happen first.
- Currently, Elevate believes that a continuing resolution will be passed mid-September to continue to fund the government at FY 2020 levels and provide Congress more time to reach agreement after the election. Other major bills are likely to face a delay until past the election including the National Defense Authorization Act (NDAA).
- The entire Senate Democratic conference sent a letter to President Trump urging the White House to rescind the nomination of William Perry Pendley to lead the Bureau of Land Management (BLM). They argue that his prior statements on climate change and past experiences related to coal leasing and the management of public lands make Pendley unqualified for the role. A press release from Sen. Martin Heinrich (D-NM), who led the letter, can be found here.
- As a reminder, Pendley is currently serving as the Director in an acting capacity.
- Rep. Ron Estes (R-KS) and House Aviation Subcommittee Chairman Rick Larsen (D-WA) introduced the Aviation Manufacturing Jobs Protection Act of 2020, which would allow a public-private cost share for aviation manufacturing companies to designate 25% of their workforce that is most at risk of furlough due to COVID-19 to be eligible for up to 50% of their total compensation covered by the Department of the Treasury, with the employer covering the remaining 50%. Bill text can be found here. A press release on the bipartisan legislation can be found here.
- The U.S. International Trade Commission (ITC) submitted a Miscellaneous Tariff Bill (MTB) report to Congress regarding 3,442 requests it received for products to be included in a new Miscellaneous Tariff Bill. It recommended lawmakers accept 2,695 of the petitions, or about 80%. Congress passes an MTB, which temporarily waives tariffs on raw materials and other goods used by U.S. manufacturers, every couple of years, with the last one being passed in 2018 and set to expire at the end of 2020. The full ITC report can be found here.
- The Mexican government issued an objection to an interim ITC rule which could potentially restrict Mexican long-haul truckers from operating in the U.S. saying that it is inconsistent with U.S. obligations under the United States-Mexico-Canada Agreement (USMCA) and would create a possibility that U.S. truckers could win relief by showing they’ve been materially harmed by competition from Mexican rivals in a “relevant sub-market.”
- In a separate filing, the American Teamsters Union and the Owner-Operator Independent Drivers Association (OOIDA) urged that this interim rule become permanent.
- In response to the Trump Administration’s sanctions on 11 Hong Kong officials, including Chief Executive Carrie Lam, the Chinese government responded with sanctions of their own, targeting Sens. Marco Rubio (R-FL), Ted Cruz (R-TX), Josh Hawley (R-MO), Tom Cotton (R-AR) and Pat Toomey (R-PA) and Rep. Chris Smith (R-NJ), as well as Human Rights Watch Executive Director Kenneth Roth, President of the National Endowment for Democracy Carl Gershman, President of the National Democratic Institute Derek Mitchell, President of the International Republican Institute Daniel Twining and President of Freedom House Michael Abramowitz. As a reminder, Sens. Rubio and Cruz, and Rep. Smith, were also sanctioned by the Chinese government in July regarding American sanctions on human rights concerns in the Uighur region of China.
- President Trump said he will explore delaying the Group of Seven (G7) summit until after the election in November. This would postpone the annual gathering once again after the COVID-19 pandemic upended plans to hold it earlier this year.
- Department of the Interior (DOI) Secretary David Bernhardt officially designated Grand Junction, Colorado as the new headquarters for the Bureau of Land Management (BLM). Bernhardt has argued that moving the headquarters will bring the agency closer to the land it oversees. The move has been criticized by Democrats.
- The Department of Transportation (DOT) reported that airline passenger figures for June 2020 were up 93% from May 2020 but down 80% from June 2019. For reference, May 2020’s airline passenger count was down 90% from last year and April’s was down 96% from last year, showing that Americans are slowly becoming more comfortable traveling by air again.
- Mark Lee Greenblatt, the Inspector General of DOI, found that the Department withheld more than 250 pages of material related to Secretary David Bernhardt’s activities at the agency before the Senate Energy and Natural Resources Committee held a hearing on his nomination.
- In response to this, Sen. Ron Wyden (D-OR) and House Natural Resources Committee Chairman Raul Grijalva (D-AZ) issued a joint statement that called for a criminal investigation into DOI’s Solicitor General, Daniel Jorjani.
- The Inspector General for the Department of Transportation (DOT) announced that they will launch an investigation into the National Highway Traffic Safety Administration’s (NHTSA) oversight of Federal Motor Vehicle Safety Standards. The objective of this self-initiated audit, according to David Pouliott, the Assistant Inspector General for Surface Transportation Audits, is to “assess NHTSA’s efforts to set and enforce Federal Motor Vehicle Safety Standards.” An announcement of the audit from DOT’s Inspector General can be found here.
- Federal Register Notices:
- The Office of the U.S. Trade Representative (USTR) issued a notice to grant certain product exclusions from an October 2019 Section 301 investigation of China’s trade practices. The notice can be found here.
- The USTR announced that it will extend certain exclusions as part of the Section 301 investigation of China’s trade practices through December 31. The notice can be found here.
- The USTR issued a request for comments on a possible extension of particular exclusions granted under the eighth notice of product exclusions as part of the Section 301 investigation of China’s trade practices, which are set to expire on September 1. The comments are due August 20 at 11:59pm ET. The notice can be found here.
- President Trump’s Executive Orders on addressing the threats posed by TikTok and WeChat were both published in the Federal Register. The order on TikTok can be found here. The order on WeChat can be found here.
- The National Aeronautics and Space Administration (NASA) issued a notice that it is collecting information to determine whether NASA personnel have been exposed to COVID-19 and to track and trace their interactions across the NASA community to identify possible points of exposure. The notice can be found here.
- The Federal Aviation Administration (FAA) announced that it is adopting a new airworthiness directive (AD) for all Boeing Company Model 737-300, -400, -500, -600, -700, -700C, -800, -900, and -900ER series aircrafts. This AD requires certain inspection of aircraft engines and is effective August 26. The FAA will accept comments on this AD until September 25. The notice can be found here.
- Democratic nominee for President and former Vice President Joe Biden announced that Sen. Kamala Harris (D-CA) will be his running mate for the upcoming election.
- Following the Executive Order that President Trump signed related to unemployment insurance, officials from several states have questioned how the proposal would work. State officials from Washington, Maine, Michigan, Kansas, Alabama, and Mississippi have expressed doubt about how they will participate the level the President initially set without using federal funds.
- As a reminder, yesterday we reported that New York Governor Andrew Cuomo (D) said that this Executive Order will cost New York $4B.
- Global COVID-19 cases surpassed 20M on Monday, doubling the 10M figure that was set only 45 days ago. The U.S., Brazil, and India are responsible for more than half of those cases.
- Technology Councils of America (TECNA), on behalf of state and local technology councils from every state, sent a letter to Congressional leadership urging that they pass two pieces of legislation that would expand broadband access in rural areas of the country.
- Specifically, the letter calls for the passage of the Expanding Opportunities for Broadband Development Act, H.R. 7160, sponsored by Rep. G.K. Butterfield (D-NC) and the bipartisan, bicameral Rural Broadband Acceleration Act (H.R. 7022/S.4201). The House bill was introduced by Majority Whip Jim Clyburn (D-SC) and Rep. Fred Upton (R-MI), and the Senate bill was introduced by Sens. Sherrod Brown (D-OH), Rob Portman (R-OH), Michael Bennet (D-CO), Mike Braun (R-IN) and Doug Jones (D-AL).
- San Francisco Superior Court Judge Ethan Schulman decided to grant the State of California’s request for an injunction on Uber and Lyft to stop classifying its drivers as independent contractors. This order is a result of California’s State government passing a law (A.B. 5) which required “workers to be treated as employees” and then California Attorney General Xavier Becerra and city attorneys sued the ride-sharing companies this year, arguing they were violating the law by having drivers classified as independent contractors. The injunction is set to take effect in ten days, at which time Uber and Lyft are expected to file legal challenges of their own. A copy of the 34-page court order is here. A press release from Attorney General Becerra can be found here.
- The Southern California Association of Governments (SCAG) reported that vehicle miles traveled (VMT) on both highways and arterial streets in the Southern California area were down 80% in early April compared to January 2020. SCAG also found that VMT is starting to inch close to pre-COVID-19 levels. Regarding bus ridership, May 2020 saw a 67% decrease from May 2019.
- The State of Ohio reported $185M in revenue for July, 8% more than was predicted a year ago and 40% more than from 2019. This increase came despite the COVID-19 pandemic and is a strong rebound compared to the previous months during which Ohio experienced a large revenue shortfall. The increase is likely a combination of the July 15 deadline to file income taxes and the 15% uptick, or $145M, in sales tax collections.
- According to a newly released report from Western Union and Oxford, global trade in services is expected to rise to $8T by 2025, up from the $6.1T figure in 2019. The report predicts that this growth will be accelerated by the adoption of new technology and digitization of working practices forced by the COVID-19 pandemic. The report forecasts that in the U.S., total services exports are projected to rise by $210B by 2025, with digitally deliverable services comprising 75% of that growth. The report also anticipates that tourism and air transport will be a smaller share of services in 2025 than they were in 2019.
- A new Global Port Tracker report released by the National Retail Federation and Hackett Associates found that major U.S. retail container ports during 2020 are expected to see their lowest annual import totals in four years, at 19.6M twenty-foot equivalent units (TEUs). This would be a 9% drop from 2016 and is largely attributable to the pandemic.
- Two major athletic conferences, the Big Ten athletic conference and the PAC-12, both announced that they will postpone their fall 2020 athletic seasons. The Big Ten and the PAC-12 are the first of the so-called “Power 5” conferences to announce fall 2020 postponements.
- As a reminder, yesterday we reported that the Mid-American Conference (MAC) postponed athletics for the fall, including football. The Mountain West Conference has also postponed football. Additionally, the University of Connecticut (UConn), who competes in the Big East Conference, previously cancelled its football season and the Ivy League schools have already cancelled all fall sports.