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US Stimulus Package at $2 Trillion to start with

How The Cares Act Works because of the US Stimulus

US Stimulus & The $2 Trillion Covid-19 Response: At a Glance. US StimulusPayments for each American citizen
  • Unmarried citizens would receive $1,200
  • Married couples would receive $2,400
  • Every child under 17 has $500 given to their parents
  • Those with adjusted gross incomes of more than $75,000 would receive less money
  • Those earning more than $99,000 would receive nothing
  • Thresholds would double for couples.

Suspension of student loan payments

  • The Department of Education would agree to suspend all payment deadlines with no fees or penalties until September 30th.
The Department has already made plans to allow suspension of payment without penalty or interest for at least 60 days. Delay for the REAL ID deadline
  • The deadline to get a new federally accepted I.D. for flights will be extended by at least a year until September 2021.

Increase in unemployment benefits because of the US Stimulus

The $2 Trillion bill makes major changes to unemployment assistance, increasing the benefits and broadening who is eligible.
  • The federal government would boost the state benefits with an additional $600 per week for four months.
  • Benefits would extend for up to 13 weeks on top of the usual limits.
  • A new program for those unemployed because of the virus who do not qualify for regular welfare, such as freelancers and the self-employed.
Treasury Department lending program will receive $500 billion out of the $2 Trillion
  • This funding would include loans, guarantees, and investments.
  • $25 billion for passenger air carriers
  • $4 billion for cargo air carriers
  • $17 billion for businesses in national security
  • The remainder will split between enterprises, states, and municipalities, with some restrictions.
    • Businesses in receipt may not issue dividends for up to 365 days after the loan is complete.
    • They must retain 90% of employment as much as possible until September 30th.
    • The loan must not last more than five years.
  • Direct loans to businesses between 500 and 10,000 employees or to non-profit organizations will not require repayment until six months after the issue.
No funding for federally elected officials and their immediate relatives
  • Businesses owned or part-owned by “the President, the Vice President, the head of an Executive department, or a Member of Congress; and the spouse, child, son-in-law, or daughter-in-law” cannot qualify for federal funding.
  • Part-owned is defined as a 20% stake or above.
Defense Department funding with limitations
  • No money will go to the border wall project
  • $1.2 billion would go to the National Guard’s COVID-19 response.
  • $1 billion for the Defense Purchases Act
  • The Pentagon may transfer funds but not to the counter-drug account

Protection for the airline industry

  • $32 billion for wages and benefits overall
  • $25 billion for passenger airlines
  • $4 billion for cargo airlines
  • $3 billion for contractors handling ticketing, cleaning, baggage, and others.
  • A further $25 billion (passenger) or $4 billion (cargo) will be available in loans or loan guarantees.
  • In exchange, companies may not use furloughs, pay cuts, and stock buybacks with the money, as well as no issuing dividends until September.
  • Executive compensation will be limited.
  • Airlines in receipt may be obligated to continue service on routes with low profit or ridership for the aid of healthcare or small communities.
Hospital funding because of the US Stimulus The bill also features grants to hospitals, public and nonprofit health organizations and Medicare and Medicaid suppliers.
  • $117 billion for healthcare
  • $100 billion in funds for public health and social emergency for providers during the pandemic.
  • $65 billion for hospitals
  • Remainder directly to doctors, nurses, suppliers, and the like.
  • 20% additional reimbursement for treating Medicare patients suffering from COVID-19.
  • Elimination of scheduled payment reductions to hospitals caring for uninsured and Medicaid patients, to the tune of $8 billion.
  • Removing a 2% proposed cut for Medicare patient treatment.
Support for contractors, freelancers, and gig workers because of the US Stimulus
  • Federal aid for these types of workers, potentially including Amazon delivery drivers, Uber drivers, and the like.

Housing protections because of the US Stimulus 

The $2 trillion aid package lays out the terms of assistance for the real estate industry. In that regard, the bill focuses on mortgage payment forbearance and evictions and foreclosures stop on properties with federally backed loans.
  • Anyone suffering financially from COVID-19 will receive forbearance on a federally backed mortgage loan for 60 days, which can be extended by 30 days four more times.
  • Services cannot begin foreclosure processes for 60 days following March 18th. The bill also does not allow fees, penalties, or additional interest as a result of delayed payments. It includes similar protections for those with multifamily federal mortgage loans, allowing them to receive a 30-day forbearance and up to two 30-day extensions.
  • Tenants of those with these loans cannot get evicted for lack of rent payment for 120 days
  • Tenants may not be charged fees or penalties for not paying rent.
Funding for the Arts
  • Bipartisan support for a $25 million fund sent to the Kennedy Centre for Performing Arts in Washington, D.C.
  • The Center will not reopen until at least May 10th
  • $75 million for the National Endowment for the Arts
Funding for Food Assistance
  • $450 million for The Emergency Food Assistance (food banks) Program
    • $350 million for food
    • $100 million for distribution
  • $200 million in food assistance for Puerto Rico and other territories
  • $100 million for American Indian reservations
  • Some funding for the Supplemental Nutrition Assistance Program (food stamps) and Child Nutrition Program, though no increased eligibility or benefit parameters.
State Department Funding
  • $324 million for the State Department overall
  • Money set aside explicitly to evacuate Americans – probably U.S. diplomats or American citizens abroad.
Diplomatic funding
  • $88 million for the Peace Corps due to suspension of operations and evacuation of volunteers.
  • $324 million for foreign programs
  • $258 million for international disaster assistance
  • $350 million for migration and refugee assistance
  • $95 million for USAID operations
  • Remote oaths of office with the caveat that full reports must go to all relevant committees.

Once we are out of this short term shutdown 

of businesses, it may be a perfect time

to refinance.  Take a look at my analysis of this by

Casey Moseman, CMPS

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