$2 trillion aid package offers some relief to Mich. families and businesses
Washington — The $2 trillion stimulus package being debated by Congress to blunt the economic impact of the coronavirus contains several provisions likely to help Michigan families and businesses. But it does not include special provisions for the auto industry.
The measure includes direct payments of $1,200 for single individuals who make less than $75,000 and $2,400 for married couples making less than $150,000 combined. Individuals who make more than $99,000 or couples would make more than $198,000 combined would not qualify at all. Those making slightly less than the caps would receive smaller payments. Parents who meet qualifications would get $500 for each child under age 17.
U.S. Rep. Fred Upton, R-St. Joseph, a member of the House Energy and Commerce Committee, said the payments to Michiganians could begin being dispersed in as soon as two weeks.
"I asked in the Energy and Commerce Committee the other day, and the U.S. Treasury told us they could be between two to three weeks," Upton said in an interview with The Detroit News.
"We're going to hold them to it. That's a question on a lot of people's minds because they are hurting, whether they are working or at home. This cash in two to three weeks will be very beneficial."
Details of the measure were still emerging as the Senate was expected to tee up an in-person vote as soon as Wednesday night, though four Republican senators were holding it up because they said jobless benefits in the bill would give workers the incentive to leave their jobs and go on unemployment.
The House is expected to try to pass the measure by a voice vote that will likely take place on Thursday in a bid to prevent lawmakers from having to risk exposure by traveling back to Washington.
Four Republican senators have expressed reservations about a provision that allows for laid-off workers to receive an extra $600 in unemployment insurance. Sens. Lindsey Graham, R-S.C., Tim Scott, R-S.C., Ben Sasse, R-Neb., and Rick Scott, R-Fla., argue that the provision would make people believe they can make more on unemployment than they can by working. The objections threatened to hold up swift passage.
Sen. Bernie Sanders, I-Vermont, responded to the GOP objection by threatening to place a hold on the bill "until stronger conditions are imposed on the $500 billion corporate welfare fund." Still, he said he would vote for the measure if the GOP senators dropped their demand to reduce unemployment insurance.
U.S. Sen. Gary Peters, D-Bloomfield Township, said Wednesday it's vitally important for Congress to get aid to residents in Michigan and other states as soon as possible.
“Michigan workers are not only worried about their health and safety during the Coronavirus pandemic, they are worried about their livelihoods as well," Peters said in a statement. "Workers who have lost their jobs or are not receiving a paycheck now shouldn’t be worried about whether they can put food on the table or pay their bills.”
The measure includes $150 billion for hospitals, including a $100 billion fund that will be available to health care providers on the front lines of the coronavirus crisis, according to Senate Minority Leader Chuck Schumer, D-N.Y. It also includes $50 billion in loans for airlines, $25 billion for transit systems, $10 billion for airports and $400 million for elections.
The auto industry appears to not have been granted any special carve-outs, but Upton said they will be able to apply for relief via a $500 billion fund for distressed corporations that will be included in the package.
"I think they'll be treated like any other business, as they should," Upton said. "Suppliers will be covered as well."
Automakers asked for relief from Congress in the form of loan guarantees, tax deductions for paid leaves to employees, and deferred corporate tax payments. And they wanted clarity on whether auto dealerships are "essential" businesses as states declare emergency shutdowns. But it appears the issues will not be addressed in the measure.
Dealerships are likely to qualify for loans that would be made available to small businesses with fewer than 500 employees under the proposed legislation, however.
U.S. Rep. Andy Levin, D-Bloomfield Township, said automakers are likely to be fine with the ability to apply for loans to ensure liquidity during an anticipated sharp decline in sales.
"There is help (for automakers), but it doesn't have the word auto in it," Levin said. "It treats them (like) every other industry and I think that's what everyone wanted."
Upton said the corporate loans will be good for eight weeks, and they will be converted to grants if businesses can document they used the money for operating expenses that allow them to remain open during the virus crisis.
"Someone can go to a bank under a loan provision that's in the bill and have access to SBA loans for up to eight weeks," he said. "The loans can be forgiven if the money is used for things like payroll, mortgage or rent, utility payments or sick leave. Basically, the things that business has to do to keep the doors open. Then it becomes a grant."
Upton said the measure also includes language that will grant 60-90 day forbearances to companies that are unable to pay back loans immediately "to keep the lines of credit open. This gets the regulators off their backs."
Upton said local banks will be on the front lines of processing the SBA loans to small businesses in Michigan: "They're going to be the ones to marshal this money through the SBA. And I think that's good. The local banks, they know these small businesses better than the SBA."
Levin said the measure includes four months of unemployment insurance for workers who are laid off during the virus crisis.
He said the measure also includes $150 billion for state and local governments that have populations greater than 500,000. He added the measure bans stock buybacks for companies that accept aid for a year plus the length of the loan.
Levin said the measure is an improvement over the initial version that was released over the weekend by Senate Majority Leader Mitch McConnell, R-Ky., but he said the compromise reached by Republicans and Democrats in the upper chamber is far from perfect.
"It's a highly mixed picture," he said. "There's much more about families, workers and small businesses because of the solidarity of Democrats in the Senate. It still leaves a lot out."