NARC’s Heroes Act Summary

This past Friday, the House of Representatives passed the Health and Economic Recovery Omnibus Emergency Solutions Act (Heroes Act). The 1,815-page legislation would provide a $3 trillion follow-up to the $2.2 trillion CARES Act aid passed into law in March.

The HEROES Act, developed by House Democrats, includes a variety of Democratic priority items and passed the House with only one Republican vote. While the bill has little chance at passage in the Republican-controlled Senate and has already drawn a veto threat from the White House, it creates a foundation for coronavirus-aid negotiations to move forward.

Particularly significant for regions is the focus that the bill puts on state and local funding, which was an advocacy priority for NARC and other local partners. The bill would provide $915 billion for state, local, tribal, and territorial funding, with $375 billion of that funding going to local governments.

The bill also includes a variety of other provisions including $435 billion for another round of direct payments to households and $100 billion to provide emergency assistance for low-income renters at risk of eviction.

Continue reading below for a further breakdown of the bill’s contents, with a focus on key items for regions including transportation and economic development provisions:

Local & State Budgetary Relief

SALT Deduction – Eliminates the limitation on the deduction for state and local taxes for taxable years beginning on or after January 1, 2020 and on or before December 31, 2021.

Local Fiscal Relief – $375 billion in funding to assist local governments with the fiscal impacts from the public health emergency caused by the coronavirus.

Tribal Fiscal Relief – $20 billion in funding to assist Tribal governments with the fiscal impacts from the public health emergency caused by the coronavirus.

CARES Act Coronavirus Relief Fund Repayment to DC – Provides an additional $755 million for the District of Columbia to assist with the fiscal impacts from the public health emergency caused by the coronavirus.

State Fiscal Relief – $500 billion in funding to assist state governments with the fiscal impacts from the public health emergency caused by the coronavirus.

Elections – $3.6 billion for grants to States for contingency planning, preparation, and resilience of elections for Federal office.

Transportation

  • Federal Highway Administration: $15 billion for Federal Highway Administration programs ($14.775B for States and District of Columbia, $150M for Tribal Transportation Program, $60M for Puerto Rico Highway Program, $15M for Territorial Highway Program) apportioned in the same ratio as under fiscal year 2020 appropriations legislation
    • Suballocation: A portion of funds to states are further suballocated to areas with population greater than 200,000 in the same ratio that funds were suballocated to these areas in fiscal year 2020 approprations
    • Eligible Uses: All funds (for States and the suballocated portion) can be used for:
      • Activities allowed under the Surface Transportation Block Grant Program;
      • administrative and operations expenses;
      • information technology needs; and
      • availability payments.
    • 100 Percent Federal Share: Funds obligated under this act and any funds subject to obligations limitations in the FY2020 transportation appropriations that are obligated after the date of passage of this legislation are eligible for a federal share of costs up to 100 percent.
  • Federal Transit Administration: $15.75 billion for Public Transportation Emergency Relief ($11.75B for grants to urbanized areas with population over 3M; $4.0B for grants to transit agencies that require significant additional assistance due to coronavirus)

Economic and Community Development

Community Development Block Grant –$5 billion for coronavirus response and to mitigate the impacts in our communities to be distributed by formula to current grantees.

Homeless Assistance Grants – $11.5 billion for Emergency Solutions Grants to address the impact of coronavirus among individuals and families who are homeless or at risk of homelessness and to support additional homeless assistance, prevention, and diversion activities to mitigate the impacts of the pandemic.

Emergency Rental Assistance – $100 billion to provide emergency assistance to help low income renters at risk of homelessness avoid eviction due to the economic impact of the coronavirus pandemic.

Housing for the Elderly – $500 million to maintain operations at properties providing affordable housing for low income seniors and to ensure housing providers can take the necessary actions to prevent, prepare for, and respond to the coronavirus pandemic. To ensure access to supportive services for this vulnerable population, this includes $300 million for service coordinators and the continuation of existing congregate service grants for residents of assisted housing projects.

Housing for Persons with Disabilities – $200 million to maintain operations at properties providing affordable housing for low income persons with disabilities, and to ensure housing providers can take the necessary actions to prevent, prepare for, and respond to the coronavirus pandemic.

Census Bureau, Periodic Censuses, and Programs – $400 million for expenses due to delays in the 2020 Decennial Census in response to the coronavirus.

Census Bureau, Current Surveys, and Programs – $10 million for expenses incurred as a result of the coronavirus.

Supplemental Nutrition Assistance Program (SNAP) – Provides $10 billion to support anticipated increases in participation and to cover program cost increases related to flexibilities provided to SNAP by the Families First Coronavirus Response Act.

Broadband – $1.5 billion to close the homework gap by providing funding for WiFi hotspots and connected devices for students and library patrons, and $4 billion for emergency home connectivity needs.

Assisting Small Businesses – $10 billion in grants to small businesses that have suffered financial losses as a result of the coronavirus outbreak.

Indian Health Service – $2.1 billion to address health care needs related to coronavirus for Native Americans.

Department of Labor – $3.1 billion to support workforce training and worker protection activities related to coronavirus, including:

  • $2 billion to support worker training;
  • $25 million for migrant and seasonal farmworkers, including emergency supportive services;
  • $925 million to assist States in processing unemployment insurance claims;
  • $15 million for the federal administration of unemployment insurance activities;
  • $100 million for the Occupational Safety and Health Administration for workplace protection and enforcement activities in response to coronavirus, including $25 million for Susan Harwood training grants that protect and educate workers;
  • $6.5 million for the Wage and Hour Division to support enforcement and outreach activities for paid leave benefits; and
  • $5 million for the Office of the Inspector General.

Centers for Disease Control and Prevention – $2.1 billion to support federal, state, and local public health agencies to prevent, prepare for, and respond to the coronavirus, including:

  • $2 billion for State, local, Territorial, and Tribal Public Health Departments; and
  • $130 million for public health data surveillance and analytics infrastructure modernization.

Administration for Children and Families – $10.1 billion to provide supportive and social services for families and children through programs including:

  • $7 billion for Child Care and Development Block Grants;
  • $1.5 billion for the Low Income Home Energy Assistance Program (LIHEAP);
  • $1.5 billion to support paying water bills for low income families$50 million for Family Violence Prevention and Services;
  • $20 million for Child Abuse Prevention and Treatment Act (CAPTA) State Grants; and
  • $20 million for Community Based Child Abuse Prevention Grants.

Administration for Community Living – $100 million to provide direct services such as home delivered and prepackaged meals, and supportive services for seniors and disabled individuals, and their caregivers.

Economic Development Administration:

  • Application of Law: Temporarily waives prohibition on using federal funds to pay for consultants or counsel to allow EDA grantees to pay consultants to help develop grant applications for funds under the CARES Act.
  • Federal Share: Temporarily waives matching fund requirements due to plummeting local government revenues for grants funded under the FY 19 disaster supplemental, CARES Act supplemental funding, and FY 20 appropriations.
  • Disaster Recovery Office: Grants EDA disaster hiring authority, which it currently does not have, and defederalizes the EDA revolving loan funds, which are vital lifelines to small, family owned businesses.

Additional Recovery Rebates to Individuals & Families

Provides a $1,200 refundable tax credit for each family member that shall be paid out in advance payments, similar to the Economic Impact Payments in the CARES Act. The credit is $1,200 for a single taxpayer ($2,400 for joint filers), in addition to $1,200 per dependent up to a maximum of 3 dependents. The credit phases out starting at $75,000 of modified adjusted gross income ($112,500 for head of household filers and $150,000 for joint filers) at a rate of $5 per $100 of income.

FURTHER READING

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

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)

SUPPORT FOR STATE AND LOCAL GOVERNMENT

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.

SUPPORT FOR TRANSPORTATION

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.

SUPPORT FOR INDIVIDUALS

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.

SUPPORT FOR EDUCATION SYSTEMS

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.

SUPPORT FOR HEALTH SYSTEMS

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.

SUPPORT FOR BUSINESSES

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.        

FURTHER READING

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

2019 State of the Union Address: NARC Supports Call for Infrastructure Development

2019 State of the Union Address: NARC Supports Call for Infrastructure Development

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Among multiple 2019 initiatives mentioned during his Tuesday night State of the Union Address, President Donald Trump spoke of his desire to work with Congress to develop bipartisan legislation to “deliver new and important infrastructure investment.” Emphasizing the critical nature of these improvements, the President added, “this is not an option. This is a necessity.”

 “Both parties should be able to unite for a great rebuilding of America’s crumbling infrastructure. I know that the Congress is eager to pass an infrastructure bill — and I am eager to work with you on legislation to deliver new and important infrastructure investment, including investments in the cutting edge industries of the future. This is not an option. This is a necessity.”

NARC strongly agrees that improvements to America’s infrastructure must be treated as a necessity rather than an option. Regions across the country critically need a wide range of improvements to infrastructure systems including transportation, water, energy, broadband, and public safety.

NARC looks forward to working with the Administration and Congress to develop a bipartisan infrastructure package in 2019.

Full text of the President’s remarks can be read here.