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Window On Washington - April 13, 2020, Vol. 4, Issue 15

Apr 13, 2020

Outlook for This Week in the Nation’s Capital

Upcoming Stimulus Packages. Early last week, it became clear that the SBA’s new Payroll Protection Program (PPP) will soon expend almost all of the nearly $350 billion for loans included in the CARES Act. As a result, Senate Republicans quickly pulled together a new package that included an additional $250 billion for the program, but it was blocked by Democrats, who sought to add other provisions to the bill. Senate and House Democrats want to include changes to the PPP to ensure that rural and underserved communities have access to the loans, as well as additional funding for states, hospitals, and low-income households.

Senate Majority Leader Mitch McConnell (R-KY) and House Minority Leader Kevin McCarthy (R-CA) reiterated over the weekend that they would not be willing to add anything else into the package besides increased PPP funding, and argued that Democrats can address their concerns in upcoming emergency COVID packages. However, Treasury Secretary Steven Mnuchin has had conversations with House and Senate Democratic Leadership and is willing to compromise in order to secure the increased SBA funding. Because neither the House nor Senate are in Washington, any agreement will need unanimous consent to pass. Some estimate that the program will run out of funds by Friday, and Congress is not expected to return until April 20, though this is still uncertain as the number of coronavirus cases grows in DC.

This package is separate from the next big stimulus package that House Speaker Nancy Pelosi (D-CA) has discussed in recent weeks. This package, commonly called CARES Act 2, would be broader and include additional funding for medical supplies, coronavirus testing and care, unemployment insurance, cash payments to individuals, and assistance for state and local governments. Though Pelosi walked back from the inclusion of a large infrastructure package in this bill, her Committee leaders are still working on compiling ideas in the event that something could be incorporated in the future.

FY 21 Appropriations. House Appropriations Subcommittee Chairmen received their top-line allocations known as 302(b)s, which allow subcommittees to begin drafting their bills. The current agreement on budget caps allows for only a 0.4 percent increase, or $2.5 billion for nondefense spending. However, two programs could eat through the majority of this increase: veterans’ health care and the Federal Housing Administration’s loan program. There are discussions of granting spending cap exemptions to some programs to create more room under the nondefense spending cap, but the White House is not supportive of this idea at this moment. Additional coronavirus packages could take some pressure off certain program needs, but the interplay between the upcoming emergency bills and the FY 21 process remains unclear and difficult to account for. Appropriators continue to work on the FY 21 bills remotely, and while the Committee has yet to officially announce any changes to the markup process, discussions are occurring on the possibility of a virtual markup.       

Last Week in the Nation’s Capital

CONGRESS

Budget & Appropriations

Republicans Vow to Seek Clean Funding Increase for Small Businesses: After their plans were blocked late last week, this past Saturday Senate Majority Leader Mitch McConnell (R-KY) and House Minority Leader Kevin McCarthy (R-CA) said Republicans will keep pressing for a $250 billion increase to the Paycheck Protection Program (PPP) and that they are not going to negotiate a larger COVID interim spending bill as Democrats have pushed for, raising doubts over the prospect of bipartisan talks over the next relief package. (The Hill)

Fiscal 2021 Spending Bills Move Forward Despite Virus Disruption: Top House appropriators have received preliminary top-line spending figures for their fiscal 2021 bills and are remotely drafting legislation to fund the government past Sept. 30, even as the coronavirus complicates their work. (Bloomberg)

Senate Brawl Derails Fast Push for New Coronavirus Relief: Senate Democrats blocked Senate Majority Leader Mitch McConnell’s (R-KY) attempt to deliver an additional $250 billion for small businesses, and then McConnell stifled Democrats’ attempts to pass a bill marrying the small business aid to $250 billion for hospitals and local governments. As of last Thursday afternoon, it seemed unlikely an agreement would crystallize before the Senate convenes again today. (POLITICO)

Health

'Surprise' Billing Fix Could Hitch Ride on Next Coronavirus Relief Bill: The coronavirus crisis is spurring leaders of two congressional health committees to renew bipartisan efforts to end “surprise” medical bills over fears that thousands of Americans exposed to the disease could get hit by staggering balances for out-of-network or emergency care. (POLITICO)

In Letter to Lawmakers, Insurers Say Pandemic Cost is Too Great: Insurers don’t have enough resources to cover business interruption losses in a disaster as comprehensive as the one posed by widespread small business closures from the COVID-19 pandemic, a group of insurance industry associations told two members of California’s congressional delegation. (Roll Call)

Defense

Coronavirus Pandemic Could Delay Pentagon Spending, Policy Bill, HASC Chairman Says: The coronavirus pandemic could delay federal funding bills, including the annual Pentagon spending and policy law, if the outbreak continues to paralyze American life into the summer months, a top House lawmaker on defense issues said last Tuesday. (Stars and Stripes)

Coronavirus Response to Take Priority in NDAA, House Armed Services Chairman Says: Ramping up production of testing materials for COVID-19 will be a top priority for this year’s annual defense policy bill, the chairman of the House Armed Services Committee said last Tuesday. (Roll Call)

Senate Armed Services Shelves ‘Paper Hearing’ Plans: The Senate Armed Services Committee has put its plan to hold “paper hearings” during the coronavirus crisis on ice after one hearing. (The Hill)

Labor & Workforce

Senate Democrats Push Pandemic Hazard Pay for Front-Line Workers: Senate Democrats last Tuesday proposed providing hazard pay to essential workers, including nurses and grocery store clerks, of $13 per hour in additional wages during the COVID-19 pandemic. (Roll Call)

Senate Democrats Press Labor Secretary on Benefits as Joblessness Rises: Senate Democrats pushed the Labor Department this week to expedite guidance and other assistance, putting forward a series of recommendations in an April 7 letter. (Roll Call)

Banking & Housing

Brown, Warren Call on CFPB to Protect Consumers, Not Financial Firms: Sens. Sherrod Brown (D-OH) and Elizabeth Warren (D-MA) and three other Democrats on the Senate Banking Committee urged the director of the Consumer Financial Protection Bureau to provide relief to consumers — not to financial institutions — during the coronavirus pandemic. (American Banker)

Environment/Interior

Democratic Senators Urge Trump Administration to Halt Environmental Rollbacks During Pandemic: It also comes as the administration enters a critical window -- just weeks remain to formalize rules that cannot be easily overturned by Democrats, should they prevail in November's elections. (CNN)

Energy

Lawmakers Announce Legislation to Fund Government Purchases of Oil: The legislation would give the Energy Department $3 billion with which to purchase oil to be stored in the Strategic Petroleum Reserve (SPR), a move that the Trump administration has also pushed for. (The Hill)

Cyber

Senators, Bipartisan State Officials Press Congress for More Election Funds: A group of Democratic senators and bipartisan secretaries of state from across the nation piled on the pressure last Thursday for Congress to include funding to help states grapple with holding elections in the midst of the coronavirus pandemic. (The Hill)

Agriculture

Bipartisan Group of Senators Calls on USDA to Help Biofuels Producers: A bipartisan group of senators, led by Chuck Grassley (R-IA) and Tammy Duckworth (D-IL), is calling on USDA to direct farm relief funds, through the Commodity Credit Corporation, toward biofuel producers who have seen demand and prices plummet with the drop in gasoline consumption. (POLITICO)

US Senator Tammy Baldwin Calls on SBA to Ensure Farms are Eligible for $10,000 Grants, Larger Forgivable Loans: Sen. Tammy Baldwin (D-WI) is pressing the Small Business Administration to clarify farmers' eligibility for Economic Injury Disaster Loans, and to allow guarantee they can get sufficient loans through the Paycheck Protection Program. (Baldwin Press Release)

Justice

Top House Democrats Ask Inspectors General Group for Proposals to Protect Watchdogs: Rep. Carolyn Maloney (D-NY), chairwoman of the House Oversight and Reform Committee, led 22 other top Democrats in asking Justice Department Inspector General Michael Horowitz for input on legislation after two inspector general were removed and one was publicly berated by Trump. (The Hill)

Homeland Security

Lawmakers Demand Answers on Kushner Supply Chain Influence: The letter was sent by Reps. Bennie Thompson (D-MS) and Carolyn Maloney (D-NY) to FEMA Administrator Pete Gaynor, giving an April 15 due date to provide files related to the efforts of Kushner, the president's senior adviser and son-in-law. (NBC News)

Education

Higher Ed Groups Call for $47 Billion in Federal Aid: Colleges and universities need a $46.6 billion infusion from Congress to “at least partially restore institutions,” wrote 41 education groups to congressional leaders. (Inside Higher Ed)

EXECUTIVE BRANCH

Budget & Appropriations

White House Working on Plan to Cut Aid to WHO: The White House's Office of Management and Budget is working on a possible plan to cut US aid to the World Health Organization, administration officials said last Wednesday. (NBC News)

Trump Administration Seeks Bipartisan Coronavirus Negotiations with Congress: The Trump administration has agreed to begin bipartisan talks on the next tranche of aid money for coronavirus relief, according to Senate Minority Leader Chuck Schumer last Friday. (POLITICO)

Health/HHS/NIH

NIH Begins Clinical Trial to Test Hydroxychloroquine to Treat COVID-19: The National Institutes of Health has begun enrolling participants in a clinical trial to test the effectiveness of hydroxychloroquine in treating COVID-19, the agency announced last Thursday. (The Hill)

HHS - Federal Stocks of Protective Equipment Nearly Depleted: The Department of Health and Human Services told The Associated Press last Wednesday that the federal stockpile was in the process of deploying all remaining personal protective equipment in its inventory. (Washington Post)

HHS, FEMA Ask States to Take Control of Drive-Through Testing Sites: The federal government wants states to consider taking control of drive-through coronavirus testing sites, currently run by HHS and FEMA, that have tested more than 77,000 people to date. (POLITICO)

The Great Reopening Debate: The great debate over when and how to reopen the American economy is playing out on the Sunday morning news shows, in opinion pages of the nation's newspapers — and among an increasingly influential cohort of armchair critics taking issue with faulty projections on which the administration has been relying. (Axios)

Defense/DOD

Trump Invokes Defense Production Act to Block Exports of Personal Protective Equipment: With reports of widespread shortages of personal protective equipment (PPE) and ventilators and the COVID-19 pandemic continuing to expand nationwide, the Trump Administration has turned to the Defense Production Act (DPA) – a statute that includes emergency procurement and manufacture allocation authority – to restrict exports of protective masks and gloves. (JD Supra)

Pentagon Expects Coronavirus to Hit More Navy Ships After First Outbreak: The Pentagon is expecting the novel coronavirus to hit more Navy ships after the outbreak on the USS Theodore Roosevelt, a top general said last Thursday. (The Hill)

DOJ

Barr Says Trump Firing Inspector General was 'Right Thing': Attorney General William Barr said Thursday that President Trump did the right thing firing Michael Atkinson, the inspector general for the US intelligence community who disclosed the whistleblower complaint that ultimately led to impeachment proceedings. (The Hill)

Barr: 'Troubling' Evidence in Review of Russia Involvement in 2016 Election that Could Lead to Charges: Attorney General William Barr signaled that federal officials involved in launching the investigation into Russia’s interference in the 2016 election and its links to the Trump campaign could face criminal prosecution. (USA Today)

Labor and Workforce

16 Million Jobless: Roughly 6.6 million American workers filed for unemployment last week. That means more than 16 million Americans are out of work since the start of the crisis. At this rate, unemployment is likely to reach its highest level since the Great Depression. (New York Times)

'Narrow' DOL Guidance on Coronavirus Benefits for Gig Workers Prompts Protest: Instructions from the Labor Department on how to pay emergency unemployment benefits to gig workers sidelined by the coronavirus pandemic prompted protest Monday from Sen. Ron Wyden (D-OR) and AFL-CIO President Richard Trumka. (POLITICO)

Dept. of Ed

Emergency Money for Students Arriving Soon: The Education Department is beginning to disperse the $14 billion set aside for higher education in the stimulus package passed by Congress two weeks ago, beginning with $6 billion in funds for institutions to give students through emergency grants. (Inside Higher Ed)

Trade

White House Trade Adviser Peter Navarro Calls WHO Chief One of China's 'Proxies' at the UN: Navarro said that President Trump is seriously considering cutting funding to the WHO after the president accused the agency of botching the handling of the coronavirus pandemic. (Fox News)

Department of Energy

Energy chief Brouillette confident oil price drop will push production cuts: Energy Secretary Dan Brouillette said he’s confident global oil producers will agree to drop production as leaders prepare to meet Thursday to address falling prices. (The Hill)

DHS/Immigration

White House Eyes Additional Cash for Pentagon, Homeland Security as Virus Outbreak Widens: The White House budget office will send Congress another funding request that would potentially bolster the Pentagon, the VA and Homeland Security as federal agencies work to contain the coronavirus outbreak. (Politico)

Environment/EPA/DOI

Cassidy Says Interior Will Speed Waiving of Royalty Fees for Oil Firms: Waving royalty fees would be a multibillion-dollar windfall for the industry and also cut the federal and state governments out of revenue on the brink of a national recession. (Roll Call)

Agriculture/USDA

US to Probe Surging Beef Prices, Falling Cattle Prices During Coronavirus Pandemic: The USDA will investigate why a surge in beef prices due to coronavirus hoarding did not translate into higher cattle prices for farmers, Agriculture Secretary Sonny Perdue said last Wednesday. (Reuters)

Trump - Money Going to Farmers ‘In the Pretty Near Future’: President Trump says the federal government will distribute funds to producers impacted by coronavirus-related market disruptions in the “pretty near future.” (Agri-Pulse)

Space/NASA & NOAA

Senators Ask GAO to Review FCC Oversight of Satellite Constellations: Two US Senators have asked the US Government Accountability Office to review the Federal Communications Commission’s decision to exempt satellite constellations like SpaceX’s Starlink from an environmental review, given those satellites’ effect on the night sky for astronomers trying to conduct research with ground based telescopes. (Space News)

China Suffers its Second Launch Failure in Less Than a Month: The Long March 3B rocket that failed to successfully launch a telecom satellite last week is one of China's oldest active and most reliable boosters. However this is China's second failure in eight launch attempts this year, and the second in less than a month, and it is not clear what effect these two high-profile failures will have on China's launch industry, which had planned to conduct more than 40 launch attempts this year, including a highly anticipated Mars mission in July. (ARS Technica)

FCC Risks Political Fire With Draft Space Junk Rules: New draft FCC rules designed to prevent satellite collisions and creation of dangerous space debris have sparked strong backlash from a number of commercial firms — in contrast to past advocacy by some within DoD for even more cautious operational practices. Industry sources say that top execs from a number of companies are already planning to take their concerns to the National Space Council, and to senior officials at the Commerce Department in hopes of garnering political backing for their concerns. (Breaking Defense)

Tax Reform/IRS

When are Stimulus Checks Coming? Money Could Roll Out to Americans Next Week: Americans have received conflicting information on when they will receive stimulus checks due to the economic fallout from the coronavirus pandemic. But there’s good news: Checks will be hitting their bank accounts soon. (USA Today)

IRS Launches Registration Tool For Stimulus Checks: Taxpayers who don’t usually file a tax return have been waiting to see how the Treasury Department and the Internal Revenue Service (IRS) would allow them to get their stimulus checks (Economic Impact Payments). Last week, the IRS announced a new web tool to make that happen. (IRS.gov)

Cyber

For Some CIOs, the Decision to Limit the Use of Zoom Isn’t a Big Deal: The Department of Homeland Security and the General Services Administration are advising agencies not to use the free video teleconferencing system from Zoom. (Federal News Network)

Zoom Facing Class-action Suit Over Privacy, Security Shortfalls: The video conferencing company Zoom is facing a class-action lawsuit filed last Tuesday with accusations that the app overstated its privacy policies and has failed to meet security standards. (The Hill)

Baking & Housing/HUD

Federal Reserve Unveils Details of $2.3 Trillion in Programs to Help Support the Economy: The Federal Reserve last Thursday announced a variety of new moves aimed at getting another $2.3 trillion of financing into businesses and revenue-pinched governments. Among the Fed’s measures were details regarding its Main Street Lending Program, Municipal Liquidity Facility, and several other initiatives it is undertaking to backstop the reeling US economy. (CNBC)

Fannie, Freddie Unlikely to Aid Mortgage Companies as Payments Dry Up, FHFA Chief Says: Mark Calabria, head of the Federal Housing Finance Agency, said he doesn’t see the role of Fannie Mae and Freddie Mac to help mortgage companies as they experience a cash crunch when Americans miss mortgage payments. He dismissed the mortgage companies’ concerns as “spin” and said he hasn't seen evidence that there is “a systemic crisis across the nonbank servicers.” (The Wall Street Journal)

Small Businesses Still Struggling for Loans Even as $100B is Approved: The Trump administration has approved roughly $100 billion of the $350 billion allocated for emergency loans to small businesses devastated by the coronavirus outbreak, Treasury Secretary Steven Mnuchin told lawmakers last Wednesday. (The Hill)

Transportation/DOT

American, Delta and Others Apply for Relief Grants — Now Comes the Hard Part: US airlines JetBlue, American, United and Delta on Friday submitted applications to the Treasury Department for government grants to not furlough employees through Sept. 30 despite an unprecedented decline in air travel demand. Now they have to negotiate the details. (CNBC)

Trump Rollback of Obama-Era Mileage Standards Faces Challenges in Courts: President Trump’s rollback of Obama-era mileage standards last week may prove to be one of the administration's most vulnerable environmental overhauls as opponents prepare to challenge it in court. The Trump rule dramatically scales back the year-over-year improvements automakers must make in fuel economy, leaving consumers spending more on cars and gas while spewing more pollution into the air. (The Hill)

Transportation Sends $1B in Emergency Assistance to Amtrak: More than $1 billion will be sent to Amtrak to support the railroad system during the coronavirus pandemic, Transportation Secretary Elaine Chao announced on Friday. (The Hill)