Coronavirus Relief Summary
On Monday, December 21, Congress passed the Consolidated Appropriations Act, 2021, which includes the highly anticipated coronavirus relief package. The $900 billion relief package includes funding for stimulus checks, unemployment benefits, small businesses, vaccine distribution, health care, education, transportation, rental assistance, and agriculture. President Trump is expected to sign the legislation.
Compared to the CARES Act, the stimulus checks in this new relief package are smaller. Taxpayers making less than $75,000 can expect to see a $600 stimulus check, compared to $1,200 per person included in the CARES Act. Similarly, the relief package will provide an extension of the CARES Act unemployment insurance of $300 through March 14, 2021. Under the CARES Act, workers receiving unemployment received $600 per week.
Notably, the package does not include funding for state and local governments nor liability protections for businesses; however, the package does extend the deadline for spending appropriated money from the CARES Act Coronavirus Relief Fund (aid to states and localities) by one year until December 31, 2021. Liability protection and funding for state and local governments were very contentious and excluded from the package in an effort to reach an agreement before the 116th Congress adjourned.
Below we have detailed the education, broadband, student loan, workforce development, and small business provisions of the relief package.
The legislation provides $82 billion for the education funding streams created under the CARES Act. Of this appropriation, $4.1 billion is allocated for the Governors Emergency Education Relief (GEER) Fund, of which $2.75 billion is earmarked for private schools. The Elementary and Secondary School Emergency Relief (ESSER) Fund will receive $54.3 billion, and the Higher Education Emergency Relief (HEER) Fund will receive $22.7 billion. Funds will be allocated to these streams using the same formulas that were used under the CARES Act. Funds must be used within 1 year of receiving them.
The coronavirus pandemic has highlighted the importance of connectivity, especially for education as the majority of schools went virtual for the 2020-2021 academic year. To that end, the relief package provides $7 billion for broadband access.
The bill does not extend the student loan forbearance provisions under the CARES Act. The forbearance provisions under the CARES Act are currently set to expire on January 31, 2021, after Secretary DeVos extended the provisions earlier this month.
There are no workforce development provisions in the package.
Paycheck Protection Program
The package provides $325 billion to the Small Business Administration. Of this appropriation, 284.45 billion is allocated for the Paycheck Protection Program Second Draw Loans. Small businesses with 300 or fewer employees that have lost at least 25 percent of their revenue in any quarter of 2020 are eligible to receive a second draw.
Read more on major provisions included in the bill from McGuireWoods Consulting’s federal team.
Biden Transition Update
President-elect Joe Biden’s education transition team, led by Linda Darling-Hammond, is hard at work preparing to hit the ground running on Inauguration Day (January 20, 2021). The transition team is focused on ensuring a smooth roll out of the coronavirus relief funds when the Biden Administration takes office. It is also taking steps to prepare for Biden’s policy agenda, which includes increasing Title I funding to make investments in teacher pay and early childhood education, among other things, and a focus college affordability. In addition, the transition team is reviewing policies put in place by Secretary DeVos, as President-elect Biden and his cabinet pick will likely look to reverse several of these policies, including Title IX regulations on sexual misconduct.
Connecticut Education Commissioner Miguel Cardona is set to be nominated as the next Secretary of Education. Biden has said he will choose a public school teacher to be Secretary of Education, and Cardona began his career as a fourth grade teacher.
As state legislatures convene for the 2021 legislative session, legislators will have to address a number of important issues affecting their states. At the top of the list is the ongoing coronavirus pandemic and its impact on state economies and budgets. According to the Center on Budget and Policy Priorities (CBPP), states will average a 20 percent budget shortfall in FY 21. Expenses related to the pandemic, including the rollout of the vaccine, will continue to rise, while revenues decrease, causing significant uncertainty as states look to address budget shortfalls and aid in economic recovery.
Other top issues we are likely to see in state legislatures across the country include police and criminal justice reform, data privacy, redistricting, and education. While many states enacted police and criminal justice reforms in 2020, either through regular session or through special session (Oregon and Virginia, for example), we expect additional measures to be enacted in 2021. Data privacy will be another big issue for states. Following on the heels of California passing the California Consumer Privacy Act in 2018, over two dozen states introduced their own privacy bills in the 2020 legislative session. Most of these bills did not pass, but we expect similar legislation to be introduced in 2021. Redistricting will be another priority in 2021 with the completion of the 2020 Census. Finally, as the coronavirus continues to impact our education system, states will look to mitigate learning loss and the digital divide. Expanding broadband access will likely be a top priority for states.
McGuireWoods Consulting has prepared analyses of what to expect in the 2021 legislative sessions, in the following states — Florida, Georgia, Illinois, North Carolina, South Carolina and Texas, plus an overview on how to work effectively with transition teams and an update from our national multistate strategies team for a look ahead to 2021.
McGuireWoods Consulting’s National Education Team
With significant political change at the state and national level, it is important to think ahead about your strategy in managing this changing landscape. McGuireWoods Consulting’s national education team provides guidance to clients on issues that migrate beyond a state border. We work with groups representing the nation’s governors, attorneys general and state legislative groups, and these officials play an increasing role in shaping education policy. In addition, MWC tracks bills and regulations throughout the country and is informed about key issues across all 50 states.