Timing for the next round of federal relief remains uncertain even as several major programs have ended or expired over the past two weeks. Negotiations over a final package stalled Thursday, as POLITICO and the Wall Street Journal reported. The Washington Post reports that Democratic and Republican leaders met again on Friday but could not come to an agreement.
Over the weekend, the President signed several executive actions:
- A memorandum deferring employees' portion of payroll taxes for Americans earning less than $100,000 a year between Sept.1 and Dec. 31. These taxes would still be due at the end of the deferment period, and employers have expressed confusion about this policy, as the New York Times reports.
- An executive order that allows agencies to consider halting evictions and calls on the Treasury Secretary and Housing and Urban Development Secretary to look for additional funds for rental assistance. As POLITICO reports, it does not extend the federal moratorium on evictions, nor does it add financial assistance for renters.
- A memorandum that calls for adding $400 per week in extra unemployment benefits through the end of 2020, and would require states to cover 25% of the additional benefits. As CNN reports, "because Congress has not authorized an extension of extra federal unemployment assistance, [states] will have to set up an entirely new system to deliver the additional aid" if they choose to enter into a financial agreement with the federal government.
- A memorandum that postpones student loan interest and payments through the end of 2020. CNN reports that this appears to be the only executive action of the four that will deliver the results the Administration has claimed, since it doesn't need funding from Congress, state governments or the private sector to fully implement.
The Washington Post and CNN report that there are a number of legal questions regarding these actions since the Constitution only empowers Congress to make changes in taxes or funding, not the executive branch. There are also questions about how effective these actions would be even if they legal.
The Seattle Metro Chamber maintains that a new round of federal relief from Congress is critical to helping people and businesses in our region. As the economic impact analysis we released last week found, through June 2020, our region has experienced:
- $13.4 billion in lost gross business revenue, comparing the first six months of 2020 with the same period in 2019.
- $8.1 billion in lost wages and earnings in the second quarter of 2020.
- 828,900 new unemployment claims filed in 2020, with 801,800 new claims between March 1 and July 11. The unemployment rate in the region is currently 9.3% for the Seattle MSA (June), down from 14.5% in May.
- $900 million in lost taxable retail sales.
Key federal programs at stake include:
- The Paycheck Protection Program, which still has nearly $130 billion remaining. The PPP is a critical source of funding so that businesses can continue operating. The deadline for a loan application for this program, which has helped over 5 million businesses, was August 8. A Congressional relief package is also an opportunity to improve accessibility for BIPOC-owned businesses, smaller businesses, and a wider range of non-profits.
- Emergency rental assistance programs, which will help avoid creating a financial cliff for renters when eviction moratoriums are lifted and back-rent is owed. Emergency rental assistance helps on both sides of the rental equation: it allows landlords to cover their mortgages and property taxes.
- Federal aid for local and state governments, which face significant budget pressures from the cost of the pandemic, high unemployment, and lower tax revenues from decreased economic activity. This aid would help address these pressures and invest in local economic recovery,
- Stabilization for K-12 and higher education, as well as stabilization for childcare providers. This funding is extremely important for safe re-opening once community spread has decreased, as well as for equity in education, and the ability of working parents to participate in the labor force.
- Federal enhancements to unemployment benefits, which expired last Friday. Our region still faces high unemployment, and a federal enhancement is vital so that people can continue paying their bills and purchasing goods and services - helping our economy recover.
We will continue to monitor developments on Congressional action. We also invite you to hear more about the federal landscape at a special Regional Business Roundtable with U.S. Senator Patty Murray on Tuesday, August 11, at 3:00 p.m. Click here
to register for this opportunity, which we are pleased to bring you in partnership with the Tacoma-Pierce County Chamber, the Bellevue Chamber, the Economic Alliance of Snohomish County, the Downtown Seattle Association, and the Economic Development Board for Tacoma-Pierce County.