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News and updates

Senate Passes $2 Trillion Emergency Package

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Late Wednesday night the Senate passed, by a unanimous vote, the $2 trillion COVID-19 relief package (CARES Act).

It now goes to the House where votes are expected on Friday. Speaker of the House Nancy Pelosi (D-CA) has expressed support for the bill.

Analysis is forthcoming, however the full text of the bill is available here.

Department of Education Announces New Relief Measures

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Today, US Secretary of Education Betsy DeVos announced the following new measures intended to relieve federal student loan borrowers amidst the COVID-19 national emergency.

  • The Department will halt collection actions and wage garnishments related to federal student loans for a 60 day period beginning March 13th, 2020. Private collection agencies have been requested to stop proactive collection efforts.
  • The Department will not request Treasury to withhold money from federal tax returns and social security payments.
  • The Department will refund $1.3 billion in offsets to more than 800,000 borrowers. This represents offsets which were in the process of being withheld as of March 13th, 2020.

These measures are in addition to previously announced steps; federal loan interest rates have been adjusted to 0%, as well as all borrowers have the option to halt payments for 60 days from March 13th, 2020 by contacting their loan servicer.

Deal Reached On $2-Trillion Relief Package

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Late last night/ early this morning, the Senate and White House negotiators reached a deal on a $2-trillion relief package. The Senate is expected to reconvene later today and approve it in short order.

While we haven’t seen the text yet, the following is from a letter that Senate Minority Leader Chuck Schumer (D-NY) sent to Democrats that seeks to explain, in his words, some of the changes between the initial version and the version that was agreed to last night/this morning:

  • 4 months of more unemployment insurance instead of 3 months.
  • $55 billion increase in the Marshall Plan for our Health Care System.
  • $150 billion for a state, tribal, and local Coronavirus Relief fund.
  • $10 billion for SBA emergency grants of up to $10,000 to provide immediate relief for small business operating costs.
  • $17 billion for SBA to cover 6 months of payments for small businesses with existing SBA loans.
  • $30 billion in emergency education funding and $25 billion in emergency transit funding.
  • $30 billion for the Disaster Relief Fund to provide financial assistance to state, local, tribal, and territorial governments, as well as private nonprofits providing critical and essential services.
  • More than $10 billion for the Indian Health Services, and other tribal programs.
  • Prohibit businesses controlled by the President, Vice President, Members of Congress, and heads of Executive Departments from receiving loans or investments from Treasury programs.
  • Make rent, mortgage and utility costs eligible for SBA loan forgiveness.
  • Ban stock buybacks for the term of the government assistance plus 1 year on any company receiving a government loan from the bill.
  • Establish robust worker protections attached to all federal loans for businesses.
  • Create real-time public reporting of Treasury transactions under the Act, including terms of loans, investments or other assistance to corporations.
  • Create of Treasury Department Special Inspector General for Pandemic Recovery to provide oversight of Treasury loans and a Pandemic Response Accountability Committee to protect taxpayer dollars.
  • Add a retention tax credit for employers to encourage businesses to keep workers on payroll during the crisis.
  • Provide income tax exclusion for individuals who are receiving student loan repayment assistance from their employer.
  • Eliminated $3 billion bailout for big oil.
  • Eliminated “secret bailout” provision that would have allowed bailouts to corporations to be concealed for 6 months.
  • Saved hundreds of thousands of airline industry jobs and prohibited airlines from stock buybacks and CEO bonuses.

On the House side, Speaker Pelosi has expressed her support for having the chamber adopt the Senate measure.

Read more about the situation here in the Washington Post and here in Politico.

We will continue to provide further details as they become available.