With coronavirus cases rising rapidly in the US and new hotspots arising, the pressure is on for lawmakers to develop a second stimulus proposal. Politicians on both sides of the aisle have agreed that some kind of second package is necessary, but there is disagreement about what it would look like. The House passed the HEROES Act about a month ago, and it still hasn’t passed the Senate. Congress hopes to agree on and pass a second stimulus legislation through both houses before August 7, when the House and Senate go on recess for a full month. Ahead of the heated debate that will probably unfold over the course of July, we are breaking down the top proposals and what they would look like. These proposals could be combined, or just passed on their own. We will keep you updated over the course of the summer as the process unfolds. Let’s dive in.
A Second Round of Direct Payments
It is possible that there will be another round of direct payments, likely not for the same amount (some lawmakers are calling for less, while others are asking for a higher payment the second round). It’s also possible that the second round or direct aid wouldn’t go to everyone, but just to low income families and those who have lost their jobs or the majority of their income. Trump expressed his support for a second round of stimulus checks this week, making it more likely, but many Republican lawmakers are still focused on other solutions.
Extending PUA
The extra $600 a week in unemployment benefits being sent to many Americans from the federal government will expire at the end of July, and economic leaders and policymakers are trying to figure out what comes next. Democrats are in favor of extending the $600 a week, while Republicans are more cautious. The Trump administration is considering a proposal to wean the benefits down over the course of the year, reducing it to $200 or $300 per week.
Tax Credits
From resume-building to travel, lawmakers are considering tax credits across the board to get Americans to spend and get back to work. Some proposals offer credits to business owners for hiring employees, while others are for individuals. One, the Explore America credit, would offer up to $4000 in tax credits for tourism expenses through 2021 to spur the ailing travel industry.
However, the criticism of tax credits is that they don’t offer immediate relief, just reimbursement--Americans would still have to spend the money first, and wouldn’t get it back until they file their taxes and get their return.
Aid For Local Governments
Another possibility for a second stimulus bill is offering direct aid to local governments, many of whom are operating in the red due to increased costs from the virus. The HEROES Act includes generous aid for local governments, and it’s possible that the final proposal agreed on by both houses of Congress includes some of the aid that the House advocated for. Local governments could choose to distribute those funds to citizens, use them for infrastructure projects, or use them to offset the costs of COVID-19 contact tracing, testing and treatment.
Whatever happens, we will keep you updated on a second round of coronavirus relief.
