The end-of-the-year COVID relief bill, explained

After months of kicking the ball aimlessly around the field, Congress finally scored a goal late Sunday when it reached a compromise $900 billion COVID-19 relief deal. That same day, around 1,500 people died from COVID-19, so this couldn’t have come at a better time unless that better time was literally any point in the past six months, Congress. Still, here we are. So what’s in this thing?

Not a ton.

Let’s start with the big news: a round of checks. Exactly what the terminology is for these checks in unclear. Back in the spring, Congress passed out $1,200 in relief/stimulus payments, depending on who you were and what your situation was. If you needed that money, it was relief. If you didn’t, it was stimulus. It probably helped keep the economy moving a little in the first half of the year. These checks are much smaller, just $600, and they only apply if you earned $75,000 or less in 2019, with the amount decreasing based on your annual earnings after that. That was the case with the $1,200 checks, too, but the bigger amount meant more graduated decreases than you’re going to see with a $600 check.

The average U.S. rent is just under $1,500 per month, which meant that the spring checks provided a little rent relief. The $600 check won’t really do that for anyone, and working Americans have not responded well.

If you made more than $75,000 in 2019 – which is by no means an indicator for your 2020 income – you won’t get the full amount (and if you made over $100,000, you won’t get anything), which makes it a hard sell that this is an economic “stimulus,” but if you’re in dire straits $600 is a single patched hole on the Titanic, so it really isn’t a “relief.”

Let’s look at the rest of the plan.

Rental assistance. There is a $25 billion rental assistance package that could actually be very useful. The proposal would essentially allow tenants to apply for help paying their rent and utilities, backdated to the start of the pandemic. It might not be full assistance, depending on your state (like nearly all U.S. programs, this will be administered on the state level using federal funds), but it’s possibly more significant than the direct payments will be. There’s also a big boost to SNAP, which won’t necessarily mean that more people can get SNAP (that’s what we colloquially call “food stamps”) but it does mean SNAP won’t run out of money and that’s important.

Paycheck Protection Program. The PPP ran out of funds months ago, which has locked businesses out if they were doing okay and now are not as new restrictions take hold around the county. Another $284 billion was pumped into the PPP, some of which is set aside specifically for small small businesses and not just the SBA’s definition of small businesses, which in some cases means a business that earns up to $41 million annually or has well over 1,000 employees.

COVID Response. States have been clamoring for assistance on distribution, with many saying they cannot afford the costs associated with mass urgent distribution of the vaccine. The federal government will now chip in $20 billion to purchase vaccines, $8 billion to distribute them, and $40 billion for testing and hospital payment assistance. A whopping $82 billion will help schools and colleges with the costs associated with sanitizing facilities and reopening.

Liability Shield. This is still the most mystifying part of the deal. We’ve known for a while that Sen. Majority Leader Mitch McConnell (R-KY) wanted language in any COVID-19 assistance bill that would protect companies from liability over COVID-19 exposure. The premise here is sound: COVID-19 is still not fully understood and over the course of the year our knowledge of how it is transmitted has changed significantly. A business that accidentally exposed employees or customers in June because it was following state guidance shouldn’t be liable for that exposure.

But what if the state guidance was obviously bad? What if medical experts were aware of problems but state leaders tried to conceal those problems? How far should the liability shield go? Back in July, Republicans unveiled the SAFE TO WORK Act, which would have made it “near impossible” to sue a business even if the business engaged in reckless behavior as long as that behavior was condoned by “applicable government standards.”

It’s unlikely the version agreed on Sunday is quite so draconian, but the extent of the liability shield is still not known.

Other stuff. There’s a bunch of other stuff slipped in here because of course there is:

  • Billions in transportation assistance of which $16 billion goes to airlines and $14 billion to public transit and just $1 billion to Amtrak because Congress hates Amtrak.
  • A change to Pell Grants that allows more students to access the grant and obtain the maximum benefit, expanding federal funding for college
  • Unexpectedly, the deal would make it harder for hospitals and health providers to send patients surprise medical bills. Patients would be entitled to know about network status within 72 hours and to receive an estimate of the charges; if a providers fails to provide them this information accurately or in a timely manner, the patient cannot be held liable for any unpaid difference. Exactly how accurate the estimate has to be isn’t clear but this is still a major improvement for consumers and its buried in this COVID-19 relief package for some reason. Okay, Congress.

Speaker Nancy Pelosi (D-CA) says she expects Congress to pass more aid once president-elect Joe Biden takes office in January. That probably hinges on whether Jon Ossoff and Raphael Warnock win their respective runoff elections for U.S. Senate early next month.

This article was corrected at 11:49 AM because we repeatedly said the earlier pandemic assistance was $1,500. The actual amount was $1,200.


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