Week Ending April 24, 2020

Congress Passed New COVID-19 Response Bill for Small Business, Hospitals and Testing, but Left Out Needed Aid to States and Municipalities.

  • COVID-19: Small Business, Hospital and Testing Funds
  • 2020 Medicare Trustees Report and 2020 Social Security Trustees Report
  • $50 Billion Plan for Child Care Led by Sens. Warren and Smith 

COVID-19: Small Business, Hospital and Testing Funds 

The Senate and the House passed and sent to the president for his signature a $484 billion coronavirus emergency relief package. It provides additional funding for the Paycheck Protection Program (PPP), which was created as part of the CARES Act (P.L. 106-136) to help small businesses. In addition to increased funding for PPP, which had run out of funds, the bill also provides additional assistance for emergency disaster loans and grants, and for hospitals, health care providers and testing. Like state and local aid, more testing is key to reopening the economy. The bill helps ensure that there will be more testing resources and a plan for widespread testing beyond health settings, and that the test results will be used in decision making. More funding will be needed.

  • No State and Local Aid Unfortunately, the bill did not include additional, needed relief to state and local governments. AFSCME is continuing to advocate for additional flexible grants and is working closely with other advocates. AFSCME President Lee Saunders reminded Congress that, “Day and night, public service workers remain on the front lines of the coronavirus pandemic, doing everything in their power to mitigate the impact on their communities. And yet, this latest relief package from Congress doesn't do nearly enough to help them do their life-saving work.” He added, “Congress needs to get right back to work and pass a new bill that includes $700 billion in aid to state and local governments.”  
  • Support for Aid Grows Additional support for needed state and local aid has come from the four large public sector unions, AFSCME, NEA, AFT and SEIU, who sent a letter to Congress making the case for more aid. The national organizations representing the nation’s governors, state legislators, mayors, county executives, and other state and local elected officials have also expressed strong support for immediate aid. Many members of Congress and even President Trump have said it should be addressed in the next coronavirus relief package, on which Congress is already working. 

What You Need to Know: AFSCME continues to encourage affiliate leaders and activists to press Congress for additional relief as soon as possible.  

Congress will soon vote on additional funding to fight the COVID-19 pandemic. 
Click to sign a letter to your representative today. 
Urge your representative to “Fund the Front Lines” to help working families providing vital public services protect themselves against COVID-19. 

Summary of H.R. 266, Small Business and Hospital Funds Bill 

There are four main parts of the new bill: 

  1. Health Care Funding Provides $75 billion for reimbursement to hospitals and health care providers to address COVID-19 related expenses and lost revenue. Distribution of funding would be under the same terms as the CARES Act. This funding is in addition to the $100 billion provided in the CARES Act. Funding can go to public entities, providers enrolled in Medicare and Medicaid, and other for-profit and nonprofit entities that provide diagnoses, testing, or care for individuals with COVID-19. 
  2. Testing Provides $25 billion for testing, including $11 billion to states, localities, territories and tribal governments. The $25 billion can be used for necessary expenses for COVID-19 tests, and for conducting surveillance and contact tracing. Specific provisions are as follows:  
    • $11 billion for states, localities, territories and tribes to develop, purchase, administer, process and analyze COVID-19 tests, scale-up laboratory capacity, trace contacts and support employer testing. Funds are also made available to employers for testing. 
    • $2 billion for states consistent with the Public Health Emergency Preparedness grant formula, ensuring every state receives funding. 
    • $4.25 billion for states, localities and territories based on relative number of COVID-19 cases. 
    • $750 million for tribes, tribal organizations, and urban Indian health organizations in coordination with Indian Health Service. 
    • $825 million for community health centers and rural health clinics. 
    • Up to $1 billion to cover costs of testing for the uninsured. 
    • Requires plans from states, localities, territories and tribes on how resources will be used for testing and easing COVID-19 community mitigation policies.  
    • Requires the U.S. Department of Health and Human Services (HHS) to submit a strategic plan and data within 30 days related to providing assistance to states for testing and increasing testing capacity, with the first report due within 21 days. 
  3. Small Business Loans Expands the small business loan program by $310 billion with assurances that money gets to smaller businesses and minority communities. Some nonprofits are also eligible. 
    • Paycheck Protection Program, Economic Injury Disaster Loans, and Emergency Grants – Increases the authorization level from $349 billion to $659 billion. 
    • Increases the authorization level for the Emergency Economic Injury Disaster (EIDL) Grants from $10 billion to $20 billion. Allows agricultural enterprises as defined by section 18(b) of the Small Business Act (15 U.S.C. 647(b)) with not more than 500 employees to receive EIDL grants and loans. 
    • Creates a set-aside for insured depository institutions, credit unions and community financial institutions for the Paycheck Protection Program. 
    • Defines “community financial institutions” as minority depository institutions, certified development companies, microloan intermediaries, and state or federal credit unions. 
    • This section sets aside the following amounts for the Paycheck Protection Program to be made by the following institutions: 
      • $30 billion for loans made by insured depository institutions and credit unions that have assets between $10 billion and $50 billion; and 
      • $30 billion for loans made by community financial institutions, small insured depository institutions and credit unions with assets less than $10 billion. 
  4. Disaster Loans Provides $10 billion to expand the Small Business Administration’s (SBA) Economic Injury Disaster Loan (EIDL) program to cover businesses, cooperatives, employee stock ownership plans and tribal businesses with 500 or fewer employees, as well as sole proprietors and independent contractors. The SBA was authorized to advance as much as $10,000 to EIDL recipients to pay sick leave to workers affected by COVID-19, retain employees, and make other covered payments. Advance funds don’t have to be repaid. 
    • This bill would provide a second tranche of $10 billion to replenish the coronavirus-related program. 
    • It would also provide $50 billion for additional SBA guarantees under its broader disaster loan program, 
    • It designates the amounts provided under this section of the bill as emergency spending for budgetary purposes. 

2020 Medicare Trustees Report and 2020 Social Security Trustees Report 

On Wednesday, the Boards of Trustees for the Social Security and Medicare Trust Funds issued the annual financial review of both programs. While the programs’ financial positions have changed little since last year, the report illustrates the continued need for our commitment to protecting the financial security, health and well-being for current beneficiaries as well as strengthening it for future generations. 

  • Medicare Report: The report projects that the Medicare HI fund (part A coverage) will be able to pay scheduled benefits on a timely basis until 2026. At that time, it will be able to cover 90% of reimbursements. 
  • Social Security Report: The report projects that the combined Old-Age and Survivors Insurance and Disability Insurance (OASI and DI) Trust Funds are projected to be able to pay scheduled benefits on a timely basis until 2035, like last year’s forecast. At that time, 79% of benefits will be able to be paid. 

What You Need to Know: The safety and stability that Social Security and Medicare provide are entrenched in the everyday life of our nation’s families, communities and economy. Their value cannot be understated, especially during the COVID-19 pandemic. Social Security and Medicare continuously meet the needs of families that rely on them and work efficiently, as excepted, in this time of crisis. Both programs are expected to continue to preserve the universal financial security of all families, especially those impacted by COVID-19. AFSCME will continue to work with congressional leaders to protect both programs. 

$50 Billion Plan for Child Care Led by Sens. Warren and Smith 

Sens. Elizabeth Warren (D-Mass.) and Tina Smith (D-Minn.) released their $50 billion plan to help child care, focusing on three areas for the proposed new funds: emergency funding to help child care providers serving children of essential workers remain open; supporting providers who are closed (including keeping educators on payroll); and making long term investments in our child care infrastructure to prepare for economic recovery.  

  • Provider Loans To help providers trying to access the Small Business Administration’s Paycheck Protection Program, by fully funding it so any qualifying small businesses and nonprofits involved in caring for children can easily access the program. To read a summary of Warren and Smith’s plan click here

What You Need to Know: The $50 billion would come through the Child Care Development Block Grant (CCDBG) program to ensure that every state, territory and tribal nation gets needed funding quickly. The plan would also provide states with the flexibility necessary to immediately meet needs now and to gradually get the child care system up and running again once parents return to work through an incremental approach that funds providers by classroom capacity rather than by child attendance.

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