Legislative Insights

OCTOBER 6, 2020 LEGISLATIVE INSIGHTS What We’re Watching on Capitol Hill This Week INCLUDED IN TODAY’S COVID-19 UPDATE LAST WEEK’S HIGHLIGHTS ..............................................................................................................2 Jobs Reports ......................................................................................................................................................2 Continuing Resolution Signed into Law .....................................................................................................2 WHAT TO WATCH THIS WEEK .........................................................................................................2 Congress Breaks ...............................................................................................................................................2 President Heads to back to the White House ..........................................................................................2 Stimulus Deal? ...................................................................................................................................................2 COVID Trends Raising Concerns ..................................................................................................................2 STIMULUS TALKS MAY RESUME .......................................................................................................3 FIVE COVID-RELIEF BILLS TO WATCH ..........................................................................................4 Sustaining Tourism Enterprises During the COVID–19 Pandemic (STEP) Act – S.4299 ............... 4 Paycheck Protection Small Business Forgiveness Act – S.4117 .......................................................... 5 Keeping Critical Connections Act – S.3569 ............................................................................................. 5 Workplace Safety Tax Credit – S.4178 ....................................................................................................... 6 Reviving the Economy Sustainably Towards a Recovery in Twenty-Twenty (RESTART) Act – S.3814 .................................................................................................................................................................. 6 IMPORTANT COVID-19 RELATED LINKS ........................................................................................7 HBS Legislative Insights | October 6, 2020 1 Last Week’s Highlights Jobs Reports Last week’s report shows that 877,000 private-sector jobs were added to the economy in September and an additional 145,000 jobs from July and August. However, the report reflects a seasonally adjusted loss of 350,000 jobs in public and private education. Large gains were made in lower-wage jobs in retail and leisure and hospitality, and manufacturing added 66,000 jobs, its largest increase since June. This report indicates that more than half the jobs lost from the pandemic have now been restored, and the third quarter ended with a 7.9 percent unemployment rate. The Congressional Budget Office predicted in May that the unemployment rate would be at 15.8% in the third quarter of 2020. Continuing Resolution Signed into Law H.R. 8337 became law on October 1, 2020 and extends government funding through December 11, 2020, by H.R. 8337, averting a government shutdown that would otherwise have begun Oct. 1. The CR includes an agreement between Democrats and Republicans over farm and food aid programs. All HBS COVID-19 Federal Response Updates can be found by clicking here. What to Watch This Week Congress Breaks While the House and Senate remained poised to return if necessary (to pass a COVID-relief bill), both bodies have left Washington, D.C. and are not in regular session this week. President Heads to back to the White House President Trump, who was diagnosed with COVID on Friday, returned to the White House last night after a three day stay at Walter Reed Hospital. Yesterday afternoon, Trump said on Twitter that he’ll leave Walter Reed hospital this evening after being treated for COVID-19, calling on Americans not to fear the coronavirus. According to his doctor, Sean Conley, the President Trump continues to improve even though he isn’t entirely out of the woods. Stimulus Deal? Speaker Nancy Pelosi and Treasury Secretary Steven Mnuchin engaged in another round of virus stimulus talks over the last few days with little sign that they are close to a deal, despite the urging of Trump. The biggest matter slowing down progress remains how to bridge the funding gap between the Democratic $2.2 trillion proposal and a $1.6 trillion White House counteroffer. COVID Trends Raising Concerns Most U.S. states are seeing worsening trends in new cases as Covid-19 again spreads across much of the nation. In 34 states, the seven-day average of new cases is higher now than it was a month ago. Although HBS Legislative Insights | October 6, 2020 2 the virus has waned in populous states including California and Florida, it is wreaking unprecedented havoc in the Midwest and there are ongoing concerns of the virus making a comeback in the Northeast. The U.S. Centers for Disease Control and Prevention updated its guidance to say Covid-19 can be spread indoors to people more than 6 feet away. Global infections surpassed 35 million. Stimulus Talks May Resume Despite the fact that talks between top Democrats and the Trump administration broke off at the beginning of summer and remained off track most of the August recess, fiscal markets believe that President Trump’s diagnosis boosts the likelihood of Congress and the White House reaching a deal on pandemic relief before the election. Markets steadied Monday on easing fears over President Donald Trump’s health and increased optimism over fresh U.S. fiscal stimulus. Increased confidence that U.S. lawmakers may agree on fresh fiscal stimulus is helping the mood on Wall Street. This week began with a more positive tone on talks. When combined with the news of the President’s release from hospital today, there appeared to be a new push for Congress and the White House to reach a deal on pandemic relief before the election. Speaker Nancy Pelosi and Treasury Secretary Steven Mnuchin maintained talks by telephone since last week when they met in person for the first time since early August. They’re attempting to bridge the gap between the Democratic $2.2 trillion proposal and a $1.6 trillion White House counteroffer for another stimulus bill. President Trump’s has signaled – via tweet from the hospital Saturday – to continue pressing forward on negotiations and told Congressional leaders to “get it done.” Despite these messages from the President, there was not an implicit agreement from the White House that the administration would endorse a bigger stimulus package. There are numerous variables at play in the ongoing conversations and negotiations taking place on the Hill. For instance, the President’s pressure to keep the negotiations moving forward may be a direct result of a less than glowing jobs report from last week and an increasing number of polls showing President Trump falling behind former Vice President Biden. However, major hurdles still exist to reach a final agreement. Issues include ongoing concerns and disagreements on the topline number for the COVID- relief package, serious disagreements about unemployment insurance and the total amount of funding for state and local governments. Additionally, with increased illnesses in the U.S. Senate, the ability to procedurally move legislation forward has been hampered. Furthermore, even an agreement to some sort of stimulus deal in the next few days would not guarantee the flow of any benefits to Americans for weeks to come. Once an agreement – or outline – is reached, Congress will most likely take 2-3 weeks to write the bill, be called back to Washington, overcome procedural delays in the Senate and pass the legislation. HBS Legislative Insights | October 6, 2020 3 Although there appears to be widespread consensus in Washington that another stimulus is needed, particularly for hard-hit sectors of the economy - like airlines, White House Chief of Staff Mark Meadows indicated the administration may still resist a further move toward Pelosi’s bigger proposal. With that in mind, we suspect that Washington will be able to come to some agreement in the near future, and perhaps even before Election Day; however, the size and scope of the package will most likely be very limited. Five COVID-Relief Bills to Watch Numerous pieces of legislation that could be included in a final version of a COVID-relief package are making their way through Congress. We have identified a few key initiatives that are gaining broad bipartisan support. Sustaining Tourism Enterprises During the COVID–19 Pandemic (STEP) Act – S.4299 U.S. Senators Catherine Cortez Masto (D-Nev.), Roy Blunt (R-Mo.), Amy Klobuchar (D-Minn.), and Kevin Cramer (R-N.D.) introduced bipartisan legislation to provide economic support for organizations involved in promoting and hosting tourism, travel, or other special events. The Sustaining Tourism Enterprises During the COVID–19 Pandemic (STEP) Act would modify existing Economic Development Administration (EDA) grant programs to provide direct support to the hard-hit tourism and travel industry to promote economic recovery and help increase public confidence as these industries look to reopen safely in the future. Senator Blunt noted that “the travel and tourism industry is a critical

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