Hogan Lovells 2024 Election Impact and Congressional Outlook Report
In his first significant legislative achievement in office, President Biden quickly signed the American Rescue Plan, legislation passed by Congress providing $1.9 trillion in coronavirus relief to Americans and businesses across the country.
On March 10, the U.S. House of Representatives passed, 220-211, the “American Rescue Plan Act of 2021” (H.R. 1319) as modified by the Senate. The sweeping $1.9 trillion COVID-19 relief package implemented President Joe Biden’s priority pandemic relief proposal that he released on January 14, 2021. The final vote was along party lines, with no Republican lawmakers supporting the bill with Rep. Mike Bost (IL) not voting. One Democrat, Rep. Jared Golden (ME), opposed the bill. President Biden signed the bill on March 11, aiming to prevent 11.4 million Americans from losing their boosted unemployment benefits set to expire on March 14.
The American Rescue Plan Act is the sixth major coronavirus relief package that both chambers of Congress have passed since the nation effectively shut down in March and April of 2020. With Democrats having the majority in the House and Senate after the 2020 elections, and Vice-President Kamala Harris able to cast a tie-breaking vote in the now 50-50 Senate, Democrats decided to pass the COVID-19 relief package through the budget reconciliation process. Given the size and scope of aid needed, Democrats warranted using reconciliation, which avoided a Senate filibuster and allowed the legislation to be passed with a simple majority vote rather than the normal 60 vote threshold. On Feb. 5, the House approved the Senate’s 2021 budget resolution (S. Con. Res. 5), providing the bill’s vehicle and instructions for the House committees to quickly draft and mark up legislation modeled after President Biden’s “American Rescue Plan.” On Feb. 26, the House passed their version of the bill by a 219-212 vote.
The Senate modified and passed the House bill on March 6, by a party-line 50-49 vote, with Senator Sullivan (R-AK) not voting. The bill had to be slightly modified due to some provisions were outside of Senate reconciliation rules, known as the “Byrd Rules.” Some additional modifications were made because some Democrats used their leverage in an evenly split chamber to address some of their concerns with specific provisions.
Below are some of the few notable modifications in the Senate-passed bill that was sent back to the House for final passage:
Removes the $15 an hour minimum wage provisions included in the House-passed bill because the Senate Parliamentarian said it was outside of the Byrd Rule.
Changes the phase-out range for those qualified to receive the $1400 “stimulus” checks under the legislation lowering the income levels from those in the House version because some Democrats believed that some people would receive aid they did not need.
Amends the House provisions on unemployment benefits extending the Federal Pandemic Unemployment Compensation (FPUC) through September 6, while keeping the weekly benefit at the current $300 per week rather than $400 a week passed by the House. Sen. Joe Manchin (D-WV) was concerned that employers in his state would have difficulty hiring workers as the economy improved. It also exempts up to $10,200 in unemployment benefits received in 2020 from federal income taxes for households making less than $150,000.
Establishes a new $10 billion fund to finance rural broadband infrastructure.
Sets aside $8.5 billion for rural health care providers, increasing federal subsidies for various forms of health insurance and coverage.
Earmarks $2.75 billion of school funding for private schools that serve a significant percentage of low-income students.
Increases aid levels provided to restaurants, Amtrak, and additional funding for various other activities.
President Biden discussed implementation of the American Rescue Plan Act of 2021 in advance of the signing ceremony. He noted that the Treasury Department and the Internal Revenue Service (IRS) are working to ensure that those who are eligible will start receiving direct payments this month. In addition, he indicated that the IRS and the Bureau of the Fiscal Service are building on lessons learned from previous rounds of payments to increase the number of households that will get electronic payments, which are substantially faster than checks. For households who have already filed their income tax return for 2020, the IRS will use that information to determine eligibility and size of payments. For households that have not yet filed for 2020, the IRS will review records from 2019 to determine eligibility and size of payment. That includes those who used the “non-filer portal” for previous rounds of payments.
$20 Billion to establish a national COVID-19 vaccination program including:
$7.5 billion for the CDC to prepare, promote, distribute, administer, monitor, and track COVID-19 vaccines;
$7.5 billion for FEMA to establish vaccination sites across the country;
$600 million to be directed to the Indian Health Service for vaccine-related activities;
$5.2 billion to the Biomedical Advanced Research and Development Authority (BARDA) to support advanced research, development, manufacturing, production, and purchase of vaccines, therapeutics, and ancillary medical products for COVID-19;
$1 billion for the CDC to undertake a vaccine awareness and engagement campaign;
$47.8 billion for testing, contact tracing, and mitigation;
Establishes a national strategy for testing, contact tracing, surveillance, and mitigation; and the manufacturing, procurement, distribution, and administration of tests, including personal protective equipment (PPE) and supplies necessary for administration of the tests. These funds can also be used to help mitigate COVID-19 in congregate settings by improving infection control and providing needed supplies.
$10 billion to boost domestic production of critical PPE, secure supply chains and increased capacity for vital vaccine production and to help onshore production of rapid COVID-19 tests;
$1.5 billion for the Indian Health Service’s testing, tracing, and mitigation needs;
$1.75 billion for genomic surveillance so that the U.S. can begin to adequately detect and respond to emerging and potentially more dangerous strains of SARS-COV-2 throughout the world and to better respond to future viral outbreaks;
$500 million to allow CDC to establish, expand, and maintain data surveillance and analytics, including to modernize the United States’ disease warning system to forecast and track hotspots for COVID-19;
Requires coverage of COVID-19 vaccines and treatments in the Medicaid program at zero cost-sharing and increase the FMAP to 100 percent for vaccine administration through one year after the end of the public health Emergency (PHE)
Creates state option to provide the same coverage for uninsured through the public health emergency
An additional $1400 for individuals who received the full $600 payment in December 2020
single filers with incomes up to $75,000, head of household filers with incomes up to $112,500, and joint filers with incomes up to $150,000 will receive the full payment of $1,400
completely phases out the payment for single filers making $80,000, head of household filers making $120,000, and joint filers making $160,000
Extends the Federal Pandemic Unemployment Compensation (FPUC) benefit through September 6, while keeping the benefit at the current $300 per week
Exempts up to $10,200 in unemployment benefits received in 2020 from federal income taxes for households making less than $150,000
Extends both the Pandemic Unemployment Assistance (PUA) program and the Pandemic Emergency Unemployment Compensation (PEUC) program through September 6
Nearly $130 billion for states and school districts to repair ventilation systems, reduce class sizes and implement social distancing guidelines, purchase personal protective equipment, and hire support staff to care for students’ health and well-being.
Ensures 20 percent of the funding that schools receive must be reserved to address and remediate learning loss among students.
Requires states to award K-12 funds to local school districts no later than 60 days after receipt and school districts to develop plans that ensure schools return to in-person learning;
Dedicates $800 million to help meet the needs of homeless young people;
Funds evidence-based summer enrichment at $1.3 billion and afterschool support initiatives also at $1.3 billion;
Allocates $3 billion for Individuals with Disabilities Education Act (IDEA); and
$2.75 billion for states to award grants to private K-12 schools through Sept. 30, 2023
and directs it to private schools that serve a "significant percentage" of low-income students.
Nearly $40 billion for institutions of higher education to help make up for lost revenue due to the pandemic
Requires institutions to dedicate at least half of their funding for emergency financial aid grants to students to help prevent hunger, homelessness and other hardships facing students as a result of the pandemic
Makes any future student loan forgiveness passed between December 2020 and January 2026 not taxable income
$7.1 billion to reimburse schools and to purchase equipment such as hotspots, internet service, and computers on behalf of students and patrons
With regard to ACA Marketplaces subsidies, for 2021 and 2022, removes the current cap that makes any family with income above 400% of the poverty level ineligible for any subsidies
Currently, for those enrolled in a qualified health plan earning between 100 and 400 percent of the federal poverty level (FPL), per the ACA, insurers must reduce cost-sharing in phased amounts for lower-income Americans. The American Rescue Plan ensures that anyone who received (or is approved to receive) unemployment compensation for any week during 2021 meets the requirements for an “eligible insured” under the ACA for such cost-sharing support. For the phased amounts to limit out-of-pocket expenses, household income in excess of 133 percent of the FPL would not be included in the calculation of the support under these provisions.
Note: The Congressional Budget Office (CBO) estimates the coverage expansion would cost $24.4 billion over 10 years
Any individual who receives unemployment at any point in 2021 is treated as if their income were 133% of the poverty level for the purposes of the ACA marketplace subsidy. As a result, they can purchase an ACA silver plan for zero premium
Individuals below 150% of the poverty level will pay no premiums at all (compared to 4% of their income currently)
Ensures no one will have to pay more than 8.5 percent of their income for a silver plan in the ACA marketplaces
Creates a new incentive for the 12 states that have not expanded Medicaid to do so by temporarily increasing the base Federal Medical Assistance Percentage (FMAP) by five percentage points for two years
If all 12 remaining states expanded Medicaid, more than 2 million uninsured people would gain access to Medicaid.
Allows states, for five years, to extend Medicaid eligibility to women for 12 months postpartum (The House bill would have allowed this temporary policy for seven years.)
100% subsidy for individuals who lose their job and choose to use COBRA to continue their existing employer-sponsored health coverage
Currently, those who elect COBRA coverage are required to pay the full cost of their coverage, including the employer contribution
Re-establishes the Medicare area wage index floor for hospitals located in all-urban states (states with no rural areas or no hospitals classified as rural). This change would apply for discharges occurring on or after October 1, 2021.
The Medicare wage index for hospitals in an all-urban state could not be less than the minimum area wage index for the fiscal year for hospitals in that same state. This would increase certain urban state hospital payments, as under the “rural floor” rule, a hospital in an urban area of a state cannot have a Medicare wage index value that is lower than that of a hospital in a rural area of that same state, and this would provide such a floor in these all-urban states.
An additional $8.5 billion for the Provider Relief Fund for rural hospitals and facilities for health care-related expenses and lost revenues attributable to the COVID-19 pandemic
Limits funds to Medicare and/or Medicaid providers and suppliers located in a rural area or treated as located in a rural area pursuant to Section 1886(d)(8)(e) of the Social Security Act. (Rural providers and suppliers are defined as those located in a rural census tract of a metropolitan statistical area or a state-designated rural area, or a rural referral center or sole community hospital.)
Eligible rural providers must submit an application for new Provider Relief Fund resources that includes documentation of actual healthcare-related expenses and lost revenues attributable to the COVID-19 pandemic.
$7.6 billion for public health departments to hire 100,000 additional full-time employees into the public health workforce
$240 million for meeting the public health workforce needs of the Indian Health Service
$100 million to support the Medical Reserve Corps, which consists of a network of volunteer medical and public health professionals that support emergency response efforts and community health activities
$800 million to the National Health Service Corps to support primary care health and diversify our nation’s clinician workforce
$240 million to support the Nurse Corps Loan Repayment Program, which helps support nurses working in critical shortage and underserved areas
$330 million for Teaching Health Centers that train the medical professionals who serve our most vulnerable populations
$500 million to deploy strike teams to help nursing home facilities manage outbreaks of COVID-19 when they occur
$200 million to the Secretary of HHS for the purpose of carrying out infection control support related to COVID-19 in skilled nursing facilities through quality improvement organizations
$4 billion for expanding behavioral and mental health services including:
$1.5 billion for the Substance Abuse Prevention and Treatment block grant program;
$1.5 billion for the Community Mental Health block grant program;
$420 million for certified community behavioral health clinics;
$280 million for programs that support mental and behavioral health and prevent burnout among health care providers and public safety officers;
$120 million for Indian Health Service mental and behavioral health prevention and treatment programs;
$100 million for Health Resources and Services Administration (HRSA) mental health services; and
$80 million specifically for the Pediatric Mental Health Care Access Program at HRSA.
Authorizes Medicare reimbursement for ground ambulances responding to emergency 911 calls if the patient would have been transported to a hospital or facility, but was not because of COVID-19-related community-wide emergency medical service protocols
During the COVID-19 pandemic, ambulance operators in certain geographic areas have provided care that has not been eligible for Medicare reimbursement because Medicare reimburses ambulance providers only if the ambulance transports and delivers a patient to a hospital, critical access hospital or a skilled nursing facility (SNF); however, during the COVID pandemic, some states and local governments have directed ambulances to provide care at a patient’s home to keep hospitals and emergency rooms available for COVID-19 patients.
$150 million for COVID-19 related research at the National Institute of Standards and Technology
$600 million for COVID-19 related research at the National Science Foundation
$8.7 billion for Global Health Funding for both bilateral and multilateral efforts to directly combat the virus and slow the threat of mutations by addressing immediate needs such as vaccine development, delivery, and distribution, and supporting health systems $580 million for the United Nations Global Humanitarian Response Plan for COVID-19
$800 million for the Food for Peace program
$750 million for CDC global health programs
$7.6 billion in funding to support COVID-19 response at Community Health Centers
An additional $3.5 billion for the Indian Health Service
$1.4 billion for Older Americans Act funding to support community-based and in-house services for older adults struggling during the pandemic
$150 million for the Maternal, Infant, and Early Childhood Home Visiting Program to improve the development, health and well-being of at-risk families with young children
$22.5 billion for emergency rental and utility assistance to states, territories, counties, and cities to help stabilize renters during the pandemic, and help rental property owners of all sizes continue to cover their costs;
$5 billion for emergency vouchers to transition those experiencing or at risk of homelessness, survivors of domestic violence, and victims of human trafficking to stable housing;
$100 million for rural housing;
$750 million for Native American housing; and
$100 million for housing counseling; and $20 million for fair housing.
$10 billion for the Homeowner Assistance Fund that allocates funds to states, territories, and tribes to address the ongoing needs of homeowners struggling to afford their housing due directly or indirectly to the impacts of the COVID-19 pandemic by providing direct assistance with mortgage payments, property taxes, property insurance, utilities, and other housing related costs
Sets Homeowner Assistance Fund minimum state allocation to $50 million
$4.75 billion for state and local governments – through the HOME Investment Partnership program – to finance supportive services, affordable housing and the acquisition of non-congregate shelter spaces for the hundreds of thousands of Americans experiencing homelessness during the pandemic
$4.5 billion to HHS for home energy assistance through the Low-Income Home Energy Assistance Program (LIHEAP)
$500 million in additional funds for HHS for the Low-Income Household Drinking Water and Wastewater Emergency Assistance Program established by Congress at the end of 2020
Extends SNAP maximum benefits by 15 percent (through September 30, 2021);
$1.1 billion in additional SNAP administrative funds to states to help meet the demand of increased caseloads and $25 million to improve the state SNAP online pilots; and
Allocates $800 million for WIC – supporting low-income women and infants – and temporarily boosts the value of WIC Cash Value Vouchers for vulnerable mothers and their children.
Adds WIC recipients with special dietary needs to the list of vulnerable individuals eligible for the increase in Cash Value Vouchers
$37 million to cover food shortfalls in the Commodity Supplemental Food Program which seeks to improve the health and nutrition of low-income Americans over 60 years old through access to nutritious food
More than $5 billion in P-EBT so that low-income families have access to school meals and food assistance during both the school year and summer months
Temporarily expands the age of eligibility for the Child and Adult Care Food Program at emergency homeless shelters to ensure more young adults can access needed nutrition support
$1 billion for states to cover additional cash assistance needed by TANF recipients as a result of the economic crisis
Establishes a $1 billion Pandemic Emergency Fund, with the fund to be distributed to the states for providing emergency assistance to low-income families with children
Creates a special financial assistance program under which cash payments would be made by the Pension Benefit Guaranty Corporation to financially troubled Multiemployer Pension Plans to ensure the plans can continue paying retirees’ benefits
Provides single employer pension plans with certain pension funding relief
Increases the amount of child and dependent care expenses eligible for the Child and Dependent Care Tax Credit for 2021 to $8,000 for one qualifying individual and $16,000 for two or more qualifying individuals (such that the maximum credits would now be $4,000 and $8,000)
Raises the maximum Earned Income Tax Credit for childless adults from roughly $530 to close to $1,500, raises the income limit for the credit from about $16,000 to about $21,000, and eliminates the age cap for older workers, for 2021.
Will benefit more than 17 million low-income workers
Extends through December 31, 2021, the Employee Retention Credit, created by the CARES Act, which expired on December 31, 2020 with modifications to help start-up businesses and expand the credit to include employees who are working but whose businesses have suffered a significant revenue loss
Extends, from March 31, 2021 to September 30, 2021, the payroll tax credit for employers created by the Families First Coronavirus Response Act for use to help employers defray the costs of the paid sick leave and paid family and medical leave required for employees impacted by the COVID-19 pandemic under that Act
Increases Paycheck Protection Program (PPP) Funding: Like the House bill, the Senate-passed bill includes $7.25 billion in additional funding for PPP and expands eligibility of 501(c) nonprofits of all sizes and types, except for 501(c)4 lobbying organizations
Provides an additional $1.25 billion for the Small Business Administration (SBA) shuttered venue operators grant program. This program got $15 billion in December but has yet to open. Congress also changed that businesses were allowed to apply for both a venue grant and PPP loan
Creates a Restaurant Revitalization Fund: The Senate-passed bill increased the funding allocation for a new program at the SBA to offer assistance to restaurants and bars hard hit by the pandemic from $25 billion to $28.66 billion. $5 billion is set aside specifically for smaller establishments with less than $500,000 in 2019 annual revenue. During the first 21 days, applications from restaurants owned and operated by women, veterans, or socially and economically disadvantaged individuals will receive priority
$15 Billion for COVID-19 Emergency Grants Through the Economic Injury Disaster Loan (EIDL) Program to help those who applied for relief in 2020 but did not receive the full $10,000 grant
Establishes the Community Navigator Pilot Program to increase the awareness of and participation in COVID-19 relief programs for business owners currently lacking access, with priority for businesses owned by socially and economically disadvantaged individuals, women, and veterans
$10 billion to support up to $100 billion in small business financing through state, territorial, and tribal government programs
Of this amount, $2.5 billion is dedicated for support to business enterprises owned and controlled by socially and economically disadvantaged individuals, including minority-owned businesses.)
The bill provides a total of $362 billion to state and local governments, U.S. territories and tribal governments to help them respond to the coronavirus pandemic, including public health issues and the pandemic's economic consequences, and to continue providing government services that have been threatened because of declining revenues caused by the pandemic.
$350 billion for new Coronavirus Relief Funds that is direct aid to states, localities, the U.S. territories, and the tribal Governments, including to help keep critical workers on the job.
Eligible categories for use of these funds includes: investing in water, sewer and broadband infrastructure, providing premium pay up to $13 an hour in additional wages for workers performing an essential function in the pandemic, responding to public health emergency or its consequences, provide government services to the extent necessary because revenues have declined due to the pandemic, support for some private nonprofits, entities, and special purpose units of government.
Specifies that the funds cannot be used for pensions or for tax cuts
Requires that to be authorized under this section, funds must be spent by December 31, 2024
The funding for states and localities will be distributed through the “State Recovery Fund” and the “Coronavirus Local Fiscal Recovery Fund”:
$195.3 billion for states
$130.2 billion for local governments of every size
$20 billion to federally recognized tribal governments
$4.5 billion for the U.S. territories
$10 Billion Capital Project Fund “to carry out critical capital projects directly enabling work, education, and health monitoring, including remote options, in response to the public health emergency.” In particular, the fund is expected to be used for rural broadband.
$2 Billion fund for “revenue-sharing” counties and Tribes, to be used for where “there is a negative revenue impact” from federal activities in a county.
$3.6 billion for the U.S. Department of Agriculture (USDA) to:
Increase food donations with commodity purchases from farmers for distribution to food banks, nonprofits, or restaurants, to help feed families and support farmers’ bottom line;
Improve worker safety with resources for food and agriculture businesses to purchase personal protective equipment, test kits, and other measures that keep essential food workers safe; and
Invest in infrastructure that supports food processors, farmers markets, and producers to build resiliency in the food supply in the long term.
$4 billion in USDA farm loan assistance to help farmers and ranchers of color who have faced discrimination for decades and to help them respond to the economic impacts of the pandemic
Gives the Secretary of Agriculture flexibility to provide “up to 120 percent” of the outstanding debt
$1 billion in assistance and support for community-based organizations and 1890 Land Grant and other minority-serving institutions that work with farmers of color on land access, financial training, property issues, and training the next generation of farmers, ranchers and forest land owners and operators
Directs $5 million of this funding must be allocated for equity commissions
$500 million in USDA rural initiatives to help hospitals expand vaccine distribution, purchase needed medical supplies, bolsters telehealth capacity and helps hospitals facing lost revenue and high costs
$20 billion in direct relief to federally recognized tribal governments to combat the COVID-19 pandemic, reduce health inequities, and improve economic opportunities
More than $6 billion for the Indian Health Service, with a focus on equitable and urgent access to vaccines, testing, tracing, and mental health resources
$850 million for Bureau of Indian Education-operated elementary and secondary schools as well as Tribal Colleges and Universities
$20 million for emergency grants to support Native American language preservation
Appropriates an additional $190 million from unused outlays from the Indian Health Service to the Department of Education for grants to educational organizations devoted to Tribes, Native Hawaiians and Alaska Natives
$900 million for essential tribal government services, tribal housing, child welfare assistance, public safety, potable water, and more
$750 million to support the Indian Housing Block Grant and Indian Community Development Block Grant
$500 million tribal set-aside within the State Small Business Credit Initiative (SSBCI)
$200 million to Department of Labor funding for UI oversight and OSHA enforcement
Establishes a presumption that COVID-19 is work-related and authorizes eligibility for medical benefits, lost wages and survivor benefits for federal and postal workers
Ensures veterans will not have any copays or cost-sharing for preventative treatment or services related to COVID-19 going back to April 2020 and authorizes the VA to reimburse those veterans who already submitted payments for their care during this period
More than $14.5 billion for VA to provide health care services and other related supports – including suicide prevention, women’s health services, telehealth expansion, medical facility improvements – to eligible veterans and allows up to $4 billion in spending for the Veterans Community Care Program
Nearly $400 million for up to 12 months of retraining assistance for veterans who are unemployed as a result of the pandemic and do not have access to other veteran education benefits to cover the cost of the rapid retraining program as well as a housing allowance
$272 million for the VA to mitigate the impact of the coronavirus pandemic on the benefits claims and appeals backlog
Emergency paid sick leave for VA’s frontline and essential health workers
$50 billion for the Disaster Relief Fund for reimbursements to state, local, Tribal and territorial governments dealing with ongoing response and recovery activities from the coronavirus pandemic
This funding could be used for vaccination efforts, National Guard deployments, providing PPE to frontline workers, and other FEMA resources and activities necessary to assist communities with the pandemic.
Limited funeral assistance for families who lost a loved one due to COVID, at 100% federal cost share
$400 million for the Emergency Food and Shelter Program
$300 million for FEMA Firefighter grants
$100 million for FEMA Emergency Managers Performance Grants
$110 million of humanitarian relief providing to support communities and organizations assisting with the humane, safe, and orderly reception of migrant families and individuals during COVID run through the Emergency Food and Shelter Program
$3 billion for the Economic Development Administration to provide support for communities and industries that have been disproportionately impacted by the pandemic
$30 billion for transit agencies across the country to prevent, prepare and respond to the continued threat of the pandemic
$1.7 billion to keep Amtrak fully operational through the end of FY 2021, ending worker furloughs and restoring full service
$8 billion to support airports across the country as well as airport concessions and their employees
$15 billion to extend the Payroll Support Program through September 30, 2021 stopping furloughs and layoffs for workers employed by passenger airlines and contractors servicing air carriers at airports
$3 billion in temporary payroll support for U.S. aerospace manufacturing companies to help cover the wages, salaries and benefits of manufacturing employees most at risk of being furloughed or laid off as a result of the pandemic
Authored by Anna Weinstein and Shelley Castle.