NARC Analysis: CARES Act


This afternoon, the House of Representatives passed The Coronavirus Aid, Relief, and Economic Security (CARES) Act (H.R. 748) following an earlier vote this week by the Senate. The bill is intended to provide the country with $2.3 trillion of aid to counter the physical and economic effects of the COVID-19 pandemic. This legislation is the third COVID-19 bill to be developed by Congress, following the Coronavirus Preparedness and Response Supplemental Appropriations Act (H.R. 6074) and the Families First Coronavirus Response Act (H.R. 6201).

The CARES Act, the single largest economic stimulus package in American history, faced a brief challenge in the House when Representative Thomas Massie (R-KY) attempted to force a recorded roll call vote on the bill. Congressmembers from both sides of aisle traveled quickly to Washington to establish a quorum, denying Massie’s attempt and passing the legislation with a voice vote.

Following the successful House vote, the bill will now be sent to the President, who is expected to quickly sign it into law.

Below are key items from the CARES Act, including a table of top-level figures, and summaries of the legislation’s primary areas of support, including support for state and local government, transportation, individuals, and businesses.

Top Level Funding Figures (~$2.3 Trillion Total)


State & Local Government Support (New Coronavirus Relief Fund) ($150 Billion)

The legislation provides $150 billion specifically for states, tribes, territories, and some local areas. And provides $8 billion for Tribes and $3 billion for territories (including, oddly, the District of Columbia, which is normally treated as a state for such purposes). Of the remaining $139 billion, funds are distributed to each state based on the state’s population relative to the population of the nation as a whole.

Of the amount each state receives, up to 45% of funds are available to “units of local governments,” which is defined as a county, municipality, town, township, village, parish, borough, or other unit of general government below the State level with a population of 500,000 or greater. A local area would qualify to receive a portion of funding that is equivalent to the proportion the local government’s population bears to the population of the state as a whole.

SNAP, Family Services and Housing ($42 Billion)

$25 billion in additional funding will be provided for the Supplemental Nutrition Assistance Program (SNAP) and for other child nutrition programs to support states and localities in meeting growing need for food assistance as a result of coronavirus.

$4 billion in Homelessness Assistance Grants would be provided to state and local governments to address coronavirus among the homeless population. 

CDBG ($5 Billion)

The bill provides $5 billion through the Community Development Block Grant Program (CDBG) for services for senior citizens, the homeless, and public health services. This includes $2 billion distributed using the normal CDBG formula; $1 billion to states based on a formula developed by HUD for COVID-19; and $2 billion to states and localities based on a formula to be developed by HUD within 30 days.

FEMA Disaster Relief Funding ($45 Billion)

$45 billion is being provided in funding for FEMA with $25 billion going to areas with major disaster declarations, like Washington State and New York State. The remaining $15 billion will be used for all purposes allowed under the Stafford Act.

EDA Funding ($1.5 Billion)

The bill allocates $1.5 billion to the Economic Development Administration through September 30, 2022. This will help regions mitigate the local economic crisis and rebuild impacted industries such as tourism or manufacturing supply chains.

USDA-Rural Development Programs ($145.5 million)

The stimulus package provides an additional $20.5 million for the Rural Business Program under the Rural Business Cooperative Service to support loans for rural business development programs. It allocates $25 million for the Distance Learning and Telemedicine Program which helps provide broadband services to rural communities to support vital distance learning and telemedicine. The bill also provides $100 million in grants to the ReConnect pilot program to provide broadband services to rural areas to meet the Federal Communications Commission speed standards of 10 Mbps downstream and 1 Mbps upstream.

Dislocated Workers National Reserve ($345 million)

The bill provides $345 million for dislocated workers (through September 30, 2022) to prepare for and respond to layoffs resulting from the COVID-19 pandemic.

Homeless Assistance Grants ($4 billion)

The stimulus package provides $4 billion to enable state and local governments to provide effective, targeted assistance to contain the spread of COVID-19 among homeless individuals. It will also provide homelessness prevention funding for individuals and families who would otherwise become homeless because of the coronavirus pandemic.

Project-Based and Tenant-Based Rental Assistance ($2.25 billion)

The package provides $1 billion for project-based rental assistance to make up for reduced tenant payments as a result of coronavirus. $1.25 billion for tenant-based rental assistance will be provided to preserve Section 8 vouchers for seniors, the disabled, and low-income working families.

Section 202 Housing for the Elderly ($50 million)

This $50 million in funds will help maintain housing stability and services for low-income seniors.

Section 811 Housing for Persons with Disabilities ($15 million)

The bill provides $15 million to make up for reduced tenant payments as a result of the coronavirus pandemic.


In total, the bill provides $114 billion for transportation-related purposes, $88 billion of which for aviation-related grants (as well as industry loans and loan guarantees). Of the remaining $26 billion, most of that goes to transit ($25 billion) and Amtrak ($1+ billion).

Transit ($25 Billion)

The bill provides $25 billion for “Transit Infrastructure Grants” to allow transit agencies to “prevent, prepare for, and respond to coronavirus.” These funds are treated as if they are provided under 49 U.S.C. 5307 (Urbanized Area Formula Grants) and 49 U.S.C. 5311 (Formula Grants for Rural Areas), but are distributed in the same proportion as the funds in fiscal year 2020 appropriations under 5307, 5311, 5337 (State of Good Repair Grants) and 5340 (Apportionments based on growing States and high density States formula factors). Funds under 5337 are added to 5307 funds and administered under 5307.

The funds will be distributed in seven days based on FY2020 apportionment formulas. The limitation on the use of funds for operating expenses in urban areas is waved. All of the funds, regardless of which program the funds come through, is for “reimbursement for operating costs to maintain service and lost revenue due to the coronavirus public health emergency, including the purchase of personal protective equipment, and paying the administrative leave of operations personnel due to reductions in service.” These additional operating funds DO NOT need to appear in a TIP, STIP, or LRTP to quality.

Finally, the funds for this section are from General Treasury Funds, not the Highway Trust Fund, and they are not subject to any limitation on obligations. Eligible projects can be funded with 100% federal funds.

Harbor Maintenance Trust Fund

The bill contain a provision that impacts new receipts into the Harbor Maintenance Trust Fund, treating these funds as mandatory spending not subject to spending caps (and therefore making the funds easier to spend; previously, these funds would require a spending offset). This provision does not affect the spending down of the current HMTF balance (which is $9 billion or so), but does prevent the balance from continuing to grow. This provision will take effect on Jan. 1, 2021 or upon passage of the next Water Resource Development Act (WRDA).

Amtrak ($1 Billion)

Just over $1 billion is provided for Amtrak, including $492 for Northeast Corridor grants and $526 million for National Network grants. Reduces required payment from states for “State-Supported Routes” and sets aside $239 million from National Network grants in lieu of an increase in a state’s payment.

Aviation ($42 Billion [Excluding Loans & Loan Guarantees])

Much of the transportation-related funding in the bill is provided for aviation purposes, including $32 billion in direct grants, $46 billion for loans and loan guarantees (out of the $500 billion loan and loan guarantees program), $10 billion for airport grants, and suspension of collection of Airport and Airway Trust Fund excise taxes for the remainder of the calendar year. In addition, an additional $56 million is provided for Essential Air Service.

General Highway Provision

The bill temporarily allows truck weight limits on the Interstate system to be exceeded for trucks carrying emergency supplies, to be in place through September 30, 2020 so long as the disaster declaration remains in effect.


Unemployment Benefits ($260 Billion)

The bill changes unemployment insurance benefits in several dramatic ways. The bill provides unemployed workers with their basic state unemployment benefits (about $300 per week) plus a federal supplement of $600 per week for up to four months. The bill also extends state benefits for 13 weeks.  This results in up to 39 weeks of benefits for many workers. In addition, the bill provides incentives for states to waive their waiting periods, and makes unemployment compensation available to part-time, self-employed, and gig workers as well.

Notably, this bill does not contain an amendment which was requested by many local government partners to remove a provision that requires states, local governments and their political subdivisions and instrumentalities to provide paid sick leave, while prohibiting these governmental entities from receiving the tax credits available to private employers.

Stimulus Checks ($290 Billion)

Checks will be sent to Americans in amounts of $1,200 per adult and $500 per child. Check eligibility will be phased out above $75,000 of income for individuals and $150,000 of income for couples.

Tax Reductions for Individuals ($20 Billion)

The bill would provide several tax reduction avenues for individuals including allowing HSA purchases of menstrual Products and temporarily waiving retirement minimum distribution rules.


Education Spending ($32 billion)

An education stabilization fund for states, school districts, & higher education institutions will be provided $31 billion. Other Department of Education programs will receive approximately another $1 billion in funding.


Hospitals and Health Care ($180 Billion)

$100 billion of funding in the bill is being put toward hospitals responding to COVID-19. Other funding will go to drug access; CDC, FDA, NIH, IHS, & other health-related agencies; care for veterans; and the replenishing of the nation’s stockpile of medical supplies.


Small Business Support ($377 Billion)

Small business funding will be provided in three ways:

$10 billion of funding is being provided for Economic Injury Disaster Loans (EIDL) for grants up to $10,000 to cover immediate operating costs for businesses.

$350 billion is allocated for the Small Business Administration (SBA) to provide loans of up to $10 million per business. Use of that money is flexible as long as businesses keep their workers employed through the end of June.

Lastly, $17 billion will be for the SBA to cover 6 months of payments for small businesses with existing SBA loans.

Large Business Support ($510 Billion)

A large portion of the bill will be used to provide loans and loan guarantees for large companies, particularly for those industries hardest hit by COVID-19 such as airlines.

Tax Reductions for Businesses ($280 Billion)

The bill would loosen caps imposed by the Tax Cuts & Jobs Act on interest deductibility & operating losses, provide payroll tax credits for businesses who retain workers at a loss, and delay employer payroll tax payments from 2020 to 2021 & 2022       $12. The bill would also introduce a very COVID-19-specific provision allowing liquor distillers to make hand sanitizer tax-free.        


For more information on the CARES Act check out these other resources: