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An Update on the Coronavirus Stimulus Package

By: Robert Knight, Director of Government Relations and Workforce Policy

When it comes to funding the federal government, Congress often waits until the last minute. On the evening of September 30, as fiscal year 2020 was about to end, the Senate passed a Continuing Resolution (CR). President Trump signed the bill at 1:00 a.m. on October 1 upon his return from a campaign trip to Minnesota. Technically, the government was closed for 60 minutes. The temporary spending bill expires on December 11, at which time Congress will have to go through the process once again. For now, federal programs will operate in Fiscal Year 2021 at the same funding levels as the prior fiscal year.

In a final attempt to end the stalemate in negotiations over a new coronavirus stimulus package, House Democrats passed a revised version of the HEROES Act on October 1. The bill, initially approved by the House in May at an estimated cost of $3.4 trillion, was a slimmed-down version that would cost $2.2 trillion. Treasury Secretary Steve Mnuchin, in discussions with House Democrats, had signaled that the White House would agree to an overall expenditure of about $1.6 trillion, which left the two sides quite far apart. While both Speaker Nancy Pelosi and Majority Leader Mitch McConnell have expressed doubts about whether an agreement can be reached, negotiations continued into early October.

As members of Congress campaign, they are seeing first-hand the economic pain and anger caused by the pandemic in their home areas only weeks before the national election. These members would like to show that they are taking action. However, on October 6, when Federal Reserve Chairman Jerome Powell called for more economic stimulus, saying that too much spending was better than too little, President Trump abruptly announced that his staff was withdrawing from the negotiations. The President tweeted that a major stimulus would be approved after the election. For now, he suggested that the Senate focus on the nomination of Amy Coney Barrett for a seat on the Supreme Court. This would seem to put the issue to rest until late November. However, it’s never over till it’s over as the saying goes, and in today’s Washington, it’s not unthinkable, although unlikely, that a deal will be struck over the next several days.

In closing, we need to note that the scaled-back HEROES Act included $2.6 billion for workforce training: $2.1 billion for the Workforce Innovation and Opportunity Act (WIOA) system and $500 million for the Employment Service. It also included added flexibility for Job Corps Centers to address and manage coronavirus and continue quality services for their students.

These workforce provisions may not survive even if a stimulus bill is passed later this year. However, we will see an increased emphasis on workforce development services if not this year, almost certainly in the coming year.