Update On Federal COVID-19 Relief Negotiations

Despite initial optimism from a bipartisan U.S. Senate working group’s $908 billion COVID-relief proposal, negotiations have shown little progress last week.

While the $900 billion price range is agreeable to both sides, Republican and Democratic leadership are divided on funding for state and local governments and corporate liability protections.

The current bipartisan Senate proposal, which is acceptable to most Democrats and many Republicans, includes a temporary shield for liability lawsuits as well as $160 billion in funding for state and local governments.

Senate Republican leaders, however, have said that the current proposal’s liability protections are unacceptable.

Sen. John Cornyn (R-TX) said that liability protections must ensure that lawsuits against employers are tried in federal and not state courts to ensure a more uniform standard.

Senate Majority Leader Mitch McConnell (R-KY) suggested Congress move forward with a smaller package that excludes increased liability protections and additional state and local government funding, but Democrats view this as a non-starter.

Despite this news, please continue to urge Congress to include important COVID-19 liability protections for businesses.

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While the fate of a COVID-relief package is unknown, any such package will include enhanced funding for the Paycheck Protection Program (PPP).

The current $908 billion bipartisan proposal includes $300 billion for PPP loans, and says that small businesses with less than 300 employees who sustained a 30 percent revenue loss in any 2020 quarter would be eligible for a second round of PPP funding.

The proposal also says that business expenses paid for with PPP funding would be tax deductible.

Assuming final passage of a one week extension Congress next week must pass a FY2021 spending package (or another Continuing Resolution) by Friday, December 18.

This leaves little time for continued COVID-relief negotiations, though some Republican and Democratic leaders said they would stay in Washington until an agreement is reached.

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