Bipartisan Lawmakers Propose $908B in Relief, Split Into 2 Parts

A bipartisan group of lawmakers delivered details of their proposed $908 billion pandemic-relief package, splitting it into two parts in recognition of deep differences over state aid and a liability shield for employers.

Now it will be up to Democratic and Republican leaders in Congress to find a way to get one or both parts of the plan through the House and Senate before the last of the economic relief provisions from an earlier stimulus expire at the end of the year.

The senators who worked to negotiate a compromise over the past two weeks are proposing a $748 billion relief plan that includes nearly $300 billion in help for small business, $300-per-week in enhanced unemployment benefits and aid for vaccine distribution.

Their second bill only contains two elements: $160 billion in state aid sought by Democrats and the liability provisions that Republicans have said should be part of an aid package.

“Bipartisanship and compromise is alive and well in Washington,” said Democratic Senator Joe Manchin of West Virginia in a press conference unveiling the proposed bill. “Now it’s up to the leadership to take it and make this happen on a timely basis.”

Competing Plan

House Speaker Nancy Pelosi and Senate Democratic Leader Chuck Schumer have embraced the group’s efforts as the framework for leadership negotiations that will now begin in earnest if any package is to be completed before Congress finishes work for the year. But Senate Majority Leader Mitch McConnell and other top Republican leaders last week said they favor a competing $916 billion relief plan by Treasury Secretary Steven Mnuchin.

While McConnell has advocated severing the state and local aid and liability protections from relief legislation, Pelosi and Schumer have argued that the funding for states and localities is too important.

The bipartisan group’s $748 billion package includes $300 billion for help to small businesses, including through the Paycheck Protection Program, $180 billion for additional unemployment insurance, $45 billion for transportation including airlines and $82 billion for education. Other provisions include $25 billion for housing assistance, $16 billion for vaccine distribution and testing, and $10 billion each for child care, the U.S. Postal Service and rural broadband.

In the second measure, the liability shield would protect businesses for less time than the proposal backed by McConnell. Instead of four years of protection, the time frame would be just one year after enactment and plaintiffs would be allowed to file lawsuits in state courts. In exchange, the proposal grants a key concession to Republicans by establishing a gross negligence standard for liability, which could allow employers who make good faith efforts to prevent the spread of Covid-19 from paying damages. The bill would also allow defendants to shift cases to federal court and would require plaintiffs to demonstrate that employers were responsible for their infection.

The $160 billion in state and local aid in the second bill would be distributed using needs-based criteria. The compromise allocates one-third of $152 billion to states and localities based on population and the other two-thirds based on revenue losses. Each state would get a minimum of $500 million. An additional $8 billion goes to tribal governments.

The bipartisan group’s decision to split the plan into two reflects the depth of partisan divisions. Democratic leaders are pushing for the state and local aid as part of a final plan, but Republicans criticize them for trying to bail out mostly blue states. McConnell is pushing for some protections for most employers facing Covid-related lawsuits from workers or customers, but Democrats say his ideas go too far.

While Republicans and Democrats have coalesced around a $900 billion figure for a stimulus package, there’s some risk that the partisan disputes over the two holdup issues blow up a deal. However, top congressional leaders say a stimulus package remains a top priority before lawmakers leave for the year-end break. They say they want to attach relief aid to a year-end spending bill that could move through Congress as early as this week.

Senate Republican leaders are calling for a pared-back package that sets aside disputes over liability and the help for state and local governments until next year, after President-elect Joe Biden is sworn in and talks ensue for yet another stimulus measure. Senator John Thune of South Dakota, the No. 2 Republican in that chamber, said on Friday that talks among congressional leaders and appropriators about attaching at least some pandemic relief to a year-end spending bill are “trending in the right direction.”