ABC-VA Blog

Stalemate Continues on COVID Relief Deal:

 

Today, President Donald Trump said he expects to sign orders on Friday or Saturday extending enhanced unemployment benefits and imposing a payroll tax holiday as lawmakers have been unable to reach agreement on stimulus legislation that includes those measures. Trump, speaking to reporters before leaving on a trip to Ohio, said he also expects to sign orders providing eviction protection and on student loan repayment. Unilateral action by Trump likely would set up a legal fight over presidential authority. Trump made the comments after House Speaker Nancy Pelosi said negotiations on a new virus relief package were making progress, though the two sides still have major differences as their self-imposed Friday deadline for a deal looms.

 

Pelosi and Senate Democratic leader Chuck Schumer are scheduled to meet again Thursday evening with Treasury Secretary Steven Mnuchin and White House Chief of Staff Mark Meadows for another round of negotiations to try to bridge the gap between them on the cost and breadth of another stimulus plan. The Trump administration has been discussing tapping unspent stimulus money from the $2 trillion stimulus passed in March to fund executive orders.

 

Pelosi said today that she would support Trump extending the eviction moratorium for renters, but said additional funding must be approved by Congress. “I don’t think they know what they’re talking about” in looking to tap unspent stimulus money, she said.

 

ABC continues to push critical priorities for the construction industry, and most recently joined a coalition of business organizations in requesting critical fixes to the next phase of small business relief through the Paycheck Protection Program.  

 

ABC also recently led an effort along with 180+ business organizations to include PPP tax deductibility in the next round of relief. You can view the full letter and signatories here. ABC is also continuing to push for the inclusion of liability protections in any deal and joined a coalition letter sent to members of Congress last week calling for passage of the timely, targeted, and temporary COVID-19 liability protections set forth in S. 4317, the “SAFE TO WORK Act." The letter, linked here, was singed by 480 organizations.

 

Sen. Rubio Warns of Layoffs if PPP not Extended:

 

Sen. Marco Rubio, R-Fla., warned on Wednesday that a new wave of small business layoffs could come if Congress does not re-up the funding to the Paycheck Protection Program in its next round of coronavirus relief spending. About $130 billion of the $650 billion allocated toward the program remains untapped, but will become unavailable on August 8 without an extension. 

 

According to reports, an administration official stated that Democrats and Republicans have come to an agreement on extending PPP funding, though the exact details remain unclear.

 

Republicans proposed last week allocating $190 billion to the program. In contrast, a $3 trillion proposal unveiled by House Democrats in their May HEROES Act did not include any new PPP funding. Sen. Ben Cardin (D-MD), the top Democrat on the Small Business Committee, said Tuesday he was largely on board with the Republican proposal. 

 

ABC Member JWR Construction Services Recognized as Senate Small Business of the Week:

 

Yesterday, U.S. Senator Macro Rubio (R-Fla.), chair of the U.S. Senate Committee on Small Business and Entrepreneurship, announced that ABC Florida East Coast Chapter member JWR Construction Services was named the Senate Small Business of the Week. JWR was recognized as an exemplary family-owned business that is committed to their employees and customers while serving their community in Deerfield Beach and throughout Florida in many ways.

White House and Democrats Attempt to Finalize COVID Relief Deal:

 

Last night, the White House and Democratic leaders agreed to try to finalize a deal to address lapsed unemployment benefits and eviction restrictions by the end of this week and hold a vote in Congress next week, suddenly trying to rush the stalled negotiation on additional COVID relief of individuals and businesses in the face of growing public and political unrest.

 

Senior White House officials said Tuesday that they made “very concrete offers” to Democrats related to unemployment benefits and eviction protections, and both sides now appear to be trying to secure a compromise quickly, while many outstanding issues, including federally enhanced unemployment benefits and funding for states and local governments, remain unresolved.

 

ABC continues to push critical priorities for the construction industry, and most recently joined a coalition of business organizations in requesting critical fixes to the next phase of small business relief through the Paycheck Protection Program.  

 

ABC also recently led an effort along with 180+ business organizations to include PPP tax deductibility in the next round of relief. You can view the full letter and signatories here. ABC is also continuing to push for the inclusion of liability protections in any deal and joined a coalition letter sent to members of Congress last week calling for passage of the timely, targeted, and temporary COVID-19 liability protections set forth in S. 4317, the “SAFE TO WORK Act." The letter, linked here, was singed by 480 organizations.

 

Archived ABC webinar: New COVID-19 Paid Leave Issues for Employers as the Country Reopens:

 

On August 3, an Obama-appointed federal judge in New York State nullified key sections of the U.S. Department of Labor’s rules governing paid leave under the Families First Coronavirus Response Act. Of greatest concern to construction, the decision invalidates previous DOL guidance restricting paid leave during layoffs and furloughs, as well as the DOL rule requiring employer consent to paid intermittent leave, and finally the rule requiring employees to provide documentation before taking leave. (The judge also declared unlawful the broad definition of “health care providers” who had been exempted from the leave requirements.) The decision obviously creates many issues for construction industry employers who have been obeying the DOL rules now declared to be unlawful.

 

ABC General Counsel Maury Baskin addressed the impact of the court decision in the August 4 webinar on New COVID-19 Paid Leave Issues for Employers as the Country Reopens. The archived webinar recording is now available on ABC’s Academy for Construction Ethics, Compliance and Best Practices site, which is restricted to ABC members in management positions and chapter staff.

 

Additionally, ABC General Counsel, Littler Mendelson P.C., issued an analysis of the decision.

 

Some Surprises in Tuesday’s Primary Results from Arizona, Kansas, Missouri, Michigan & Washington:

 

In Arizona - Sen. Martha McSally (R) was nominated with 76% of the vote and will now officially face retired astronaut Mark Kelly (D) in the general election.  Kelly, who has already raised over $46 million for his campaign, ran unopposed in the primary. This will be among the top races in the country this November. In the state’s expansive and politically marginal 1st District, two-term Rep. Tom O’Halleran (D) was unimpressive in scoring only a 59% Democratic primary win over former Flagstaff City Councilwoman Eva Putzova despite outspending her by more than a 2:1 margin.  Advancing into the general election is attorney Tiffany Shedd who captured the Republican nomination with a 54% primary win.  In the 2nd District, Defense contractor and Army veteran Brandon Martin won the Republican nomination with a plurality vote and now faces an uphill challenge against Rep. Ann Kirkpatrick (D) in the Fall. Hiral Tipirneni advanced in a crowded Democratic primary for the Scottsdale-based 6^th Congressional District. Tipirneni, the 2018 Democratic nominee for a different AZ congressional district, will  face Rep. David Schweikert who was cited last week for violating 11 House ethics rules. Democrats increasingly see this district as a potential pickup opportunity in November.

 

In Kansas - One of the most highly anticipated Senate primaries of the year ended with a big victory for Kansas Rep. Roger Marshall as he defeated former Secretary of State and 2018 gubernatorial nominee Kris Kobach and Kansas City Plumbing Company owner and self-funder Bob Hamilton in the statewide Republican primary.  Marshall’s victory takes the wind out of Kansas and National Democrat’s sails as a Kobach primary victory would have given the Democrats the inside track toward snatching away what should be a safe Republican seat.  In Topeka, freshman Rep. Steve Watkins (R), who was recently indicted for voter fraud from actions in an election other than his own, captured a mere 34% of the vote in a three-way race and lost to state Treasurer Jake LaTurner (R), who posted just under the 50% mark.  Mr. LaTurner now advances into the general election against Topeka Mayor Michelle De La Isla, who easily won the Democratic primary.  The nature of the district favors the Republican nominee, as last night’s almost 2:1 turnout factor yielded, so Mr. LaTurner should be considered the favorite for the Fall.  Former Lt. Governor Tracey Mann, will likely replace Rep. Marshall in the House seat, as the prohibitive favorite in the November election after advancing in last night’s primary in the 1^st District.  Former Kansas Republican Party chair Amanda Adkins defeated four intra-party opponents to win the 3rd District party nod.  She will now challenge freshman Rep. Sharice Davids (D) in the Fall, which will be a competitive race.

 

In Missouri - Another House member, this time ten-term veteran Lacy Clay, was upended in the Democratic primary.  Activist, Pastor and 2018 congressional candidate Cori Bush, with the outside help of the national Justice Democrats PAC, knocked Congressman Clay out of office with a 4,600 vote win, translating into a three percentage point victory in the St. Louis-area Democratic seat.  Reps. Watkins and Clay became the sixth and seventh House members to be denied re-nomination during the current election cycle.  The pair join Reps. Dan Lipinski (D-IL), Steve King (R-IA), Denver Riggleman (R-VA), Scott Tipton (R-CO), and Eliot Engel (D-NY) as members failing to win re-nomination in their respective primaries. The total of 7 House primary incumbent to lose their primary in the 2020 cycle is most in a non-national redistricting cycle since 1974.  Gov. Mike Parson (R) secured his gubernatorial candidacy last night and will defend his seat against Democratic State Auditor Nicole Galloway in November. Parson, a former lieutenant governor and state senator, was sworn into office in 2018 after Eric Greitens resigned amid misconduct allegations. 

 

In Michigan - All congressional incumbents seeking re-election were re-nominated last night, with the biggest surprises coming in the state’s 6th District.  17-term Rep. Fred Upton (R) obtaining only 62% of the vote against a candidate who literally spent nothing on her campaign. State Rep. Jon Hoadley (D), who was the clear favorite in the Democratic primary race after raising just under $1.4 million, looks to have barely slipped past educator Jen Richardson who spent less than $100,000 after revelations of a blog post that Hoadley made with controversial statements.  This now becomes a very interesting general election campaign. The open 10th District Republican primary will likely take some time to determine a winner.  According to the latest results release, ABC-supported state Rep. Shane Hernandez (R) lost the competitive GOP primary to financial executive Lisa McClain (R).  McClain will likely become the next Representative in the safely Republican district. In the 3rd District, Peter Meijer easily won the open 3rd District Republican primary.  Mr. Meijer, who is a capable self-funder, now becomes the general election favorite against attorney Hillary Scholten who was the unopposed Democratic candidate.  The November winner replaces retiring Libertarian, former Republican, Rep. Justin Amash.

 

In Washington - Gov. Jay Inslee (D) came just short of the 52% mark in a field of 35 candidates in the state’s jungle primary.  Inslee is a major re-election favorite in November against local police chief Loren Culp (R) who placed second in the field and advances into the general election.

Negotiations Continue on COVID Relief:   While negotiations continue on COVID Relief, Senate Majority Leader McConnell and Minority Leader Schumer traded barbs on the Senate floor today, each slide blaming the other for the hold up on passing a relief package. Meetings will continue today, but Speaker Nancy Pelosi warned Democrats on a caucus call that a deal likely won’t be reached until next week. Meanwhile, Sen. John Cornyn (R-Texas) is calling to keep the Senate in session until a deal is reached on a coronavirus relief package.   President Trump has also said he plans to use his executive authority to prevent evictions and lower payroll taxes as the pandemic continues should lawmakers fail to reach a legislative solution due to what he has called “slow-rolling” by Democratic negotiator. Secretary Mnuchin has reportedly discouraged the use of executive orders to address the crisis and has stressed the importance of reaching a legislative compromise.   ABC ...

Negotiations Continue on COVID Relief:

 

After failing to make a breakthrough on negotiations last week, Speaker Nancy Pelosi hosted White House chief of staff Mark Meadows and Treasury Secretary Steven Mnuchin over the weekend, where slight progress was made towards an agreement on the next COVID relief legislative package, as August recess remains on hold and the supplemental $600 federal jobless benefits have expired. The top negotiators met again today, but the focus was mostly on school funding and openings, according to reports, with no signs of an imminent deal.

 

Speaker Pelosi has expressed some flexibility on the issue of federal unemployment benefits, stating that as unemployment goes down, the $600 federal supplement could go down. However, Republicans and Democrats remain far apart on extending the $600 a week in extra unemployment aid; Republicans have proposed cutting that by as much as two-thirds and creating a formula that would replace about 70% of former wages. Following today’s meeting when asked about unemployment insurance, Senate Democratic Leader Chuck Schumer stated of Republicans “they’re sticking to their position”, followed by Speaker Pelosi stating, “And we’re sticking to ours.”

 

While the Trump White House stated on Friday that it would also be open for a deal that did not contain Senate Majority Leader Mitch McConnell’s red line on liability protections, the White House attempted to walk back its position later in the day with COS Mark Meadows saying they supported of the Leader’s proposal.

 

ABC is continuing to push for the inclusion of liability protections in any deal and joined a coalition letter sent to members of Congress last week calling for passage of the timely, targeted, and temporary COVID-19 liability protections set forth in S. 4317, the “SAFE TO WORK Act." The letter, linked here, was singed by 480 organizations.

 

Five States Vote Tomorrow – August 4:

 

Five states will vote tomorrow – Arizona, Kansas, Michigan, Missouri, and Washington. Of note are the several competitive GOP primaries, including those in Michigan at the congressional level, and Kansas at the senatorial level.  

 

In Michigan - voters will decide which GOP favorite will go on to the November general election for Retiring Rep. Justin Amash’s MI-03 Grand Rapids-based seat. The GOP needs to convert the 3rd District back into their column and features a five-person primary that looks to have whittled down into a battle between real estate analyst and Iraq War veteran Peter Meijer, whose family owns the Meijer grocery store chain that has 253 locations throughout the Midwest, and state Rep. Lynn Afendoulis (R-Grand Rapids).  The winner faces Democratic attorney Hillary Scholten, who is unopposed in her party primary.  The district leans Republican, but this race is ascending the Democratic national target list.  One of the more interesting primary races comes in the safe Republican eastern Michigan 10th District where two-term Rep. Paul Mitchell (R-Dryden) is retiring.  A mid-July poll was released late last week from WPA Intelligence for the Club for Growth that finds ABC-endorsed state Rep. Shane Hernandez (R-Port Huron) topping self-funding financial company executive Lisa McClain by six percentage points with retired Brigadier Air Force General Doug Slocum trailing significantly.  This primary will select the next Representative, as the 10th District will remain Republican in the Fall.

 

In Kansas – While GOP House member Roger Marshall has the moniker of the party's best chance to stave off a Democratic takeover in the open senate seat, conventional wisdom is telling most that if 2018 KS GOV nominee Kris Kobach (R) wins the nomination tomorrow it puts the GOP Senate majority more at risk than it is already. President Trump indicated to associates during a flight on Air Force One on Wednesday that he would not intervene in the primary despite GOP fears of nominating a weak general election candidate in Kobach.

 

Breaking News – ABC Webinar—New COVID-19 Paid Leave Issues for Employers as the Country Reopens:

 

On August 3, an Obama-appointed federal judge in New York State nullified key sections of the U.S. Department of Labor’s rules governing paid leave under the Families First Coronavirus Response Act. Of greatest concern to construction, the decision invalidates previous DOL guidance restricting paid leave during layoffs and furloughs, as well as the DOL rule requiring employer consent to paid intermittent leave, and finally the rule requiring employees to provide documentation before taking leave. (The judge also declared unlawful the broad definition of “health care providers” who had been exempted from the leave requirements.)

 

The decision obviously creates many issues for construction industry employers who have been obeying the DOL rules now declared to be unlawful. ABC General Counsel Maury Baskin will address the impact of the court decision in his previously scheduled webinar about the FFCRA, tomorrow, August 4, 2020 at 3 pm. Register here!

 

House Passes ABC-opposed Appropriations Minibus

 

On Friday, the U.S House of Representatives passed H.R. 7617 with only Democratic votes – 217-197. This appropriations minibus for FY 2021, appropriates funds for: Defense, Commerce-Justice-Science, Energy and Water Development, Financial Service, and General Government, Labor-HHS-Education, and Transportation and Housing and Urban Development departments.

 

Ahead of the vote – ABC sent a Key Vote letter urging members to oppose this bill citing the several anti-competitive provisions contained in H.R. 7617. The proposed legislation would not only include more than $245 billion in emergency spending across the bills, violating statutory budget caps, but it also contains numerous policy provisions that would fund big-labor priorities while imposing burdensome regulations on many U.S. workers in our nation’s small construction businesses, many of which are struggling to maintain operations due to COVID-19.

 

The ultimate path to enactment of the act is unlikely with the Republican-controlled Senate and a veto threat from President Trump.

ACTION—Sign Support Letter for PPP Tax Deductibility:

 

ABC National, as a Steering Committee Member of the Parity for Main Street Employers Coalition, worked to author a new letter, linked here, in support of making the PPP loan forgiveness tax free, as intended by Congress in the original CARES Act.  This change would be a technical correction and therefore not increase the cost of the Phase IV bill being debated.  Restoring the tax-free treatment of these loans is supported by the Chairs of both the tax-writing committees, and it would help avoid a large tax hike on struggling businesses who took out PPP loans with the understanding that the loan forgiveness would not increase their taxes. 

 

ABC encourages state chapters to sign on to the letter as well by COB Monday. Please click on the link and fill out the form.  https://forms.gle/yX7wPU9qcWm3RUsS8

 

Senate Leaves Town with No Deal and Failed Negotiations on COVID Relief:

 

After failing to make a breakthrough on negotiations, the Senate left town for the weekend, allowing for the expiration of federally enhanced unemployment benefits. Speaker Nancy Pelosi and Senate Democratic Leader Chuck Schumer met late into the night Thursday with White House chief of staff Mark Meadows and Treasury Secretary Steve Mnuchin, hoping to break the impasse, but ended in a blame game as talks continue into next week and Democrats seem to double down on the House-passed $3 trillion HEROES Act.

 

Critically, the Washington Post also reported this morning that President Trump is willing to break with Leader McConnell’s “red line” and cut a deal with Democrats that leaves out Senate Republican liability legislation aimed at protecting employers, hospitals and schools from coronavirus-related lawsuits, according to two people with knowledge of internal White House planning. This would be a detrimental setback for construction employers operating during the pandemic.

 

According to reports, Meadows made an offer to extend enhanced unemployment at $600 per week for four months as a stand-alone bill, a new offer and further than Republicans have gone thus far, and likely something that many Senate Republicans would not be willing to support. Pelosi and Schumer rejected the offer, and countered with extending enhanced unemployment insurance at the same rate -- $600 per week -- through the first quarter of 2021. Meanwhile, on the Senate floor, Democrats and Republicans shot down numerous unanimous consent bills to extend the unemployment aid and take up the House-passed HEROES Act.

 

The latest from Pelosi: “They never have understood the gravity of it. Since the HEROES Act passed, about 70,000 people have died. Hundreds of thousands more have been infected. And they wanted to pause, and now they come back with piecemeal.”

 

The latest from Meadows: “Tonight, once again, the White House offered a temporary extension of needed unemployment assistance—which expires tomorrow. And again, Chuck Schumer and Nancy Pelosi said no. What we’re seeing is clear. This is a politically motivated party that won’t take ‘yes’ for an answer.” Today, Meadows also claimed that Democrats have rejected four different Republican offers to protect enhanced unemployment insurance and eviction safeguards without offering any counterproposals.

 

Also at issue remains the inclusion of funding for state and local governments, workplace protections and COVID testing for Capitol Hill. The Senate will return Monday to continue talks.

 

ABC Joins Coalition in Support of Liability Protections in Senate GOP Proposal:

 

Continuing our push for liability protections for businesses operating during the COVID-19 health crisis, ABC joined a coalition letter sent to members of Congress late yesterday calling for passage of the timely, targeted, and temporary COVID-19 liability protections set forth in S. 4317, the “SAFE TO WORK Act." The letter, linked here, was singed by 480 organizations.
 

COVID-19:  U.S. Environmental Protection Agency Resources:

• List N: Disinfectants for Use Against SARS-CoV-2 (COVID-19)
• FAQs about Disinfectants and Coronavirus (COVID-19)
• Guidance for Cleaning and Disinfecting Public Spaces, Workplaces, Businesses, Schools and Homes
• EPA’s COVID-19 Hub

Tomorrow, the U.S House of Representatives is set to pass H.R. 7617, the second appropriations minibus FY 2021 bill before August recess. The package includes six FY 2021 spending bills: Defense, Commerce-Justice-Science, Energy and Water Development, Financial Service, and General Government, Labor-HHS-Education, and Transportation-Housing and Urban Development.

 

Ahead of the vote – ABC sent a Key Vote letter urging members to oppose this bill citing the several anti-competitive provisions contained in H.R. 7617. The proposed legislation would not only include more than $245 billion in emergency spending across the bills, violating statutory budget caps, but it also contains numerous policy provisions that would fund big-labor priorities while imposing burdensome regulations on many U.S. workers in our nation’s small construction businesses, many of which are struggling to maintain operations due to COVID-19.

 

Among its many provisions, H.R. 7617 would: expand the application of federal Davis-Bacon Act requirements; exclude the overwhelming majority of America’s construction industry professionals who are not educated in federal registered apprenticeship programs; prevent the ABC-supported DOL and NLRB final rules updating and clarifying its interpretation of joint-employer status under the Fair Labor Standards Act from being implemented effectively; prevent the implementation or enforcement of the final rule on ‘‘Representation Case Procedures’’ which details the requirements for union elections; and provide federal funds to develop systems and procedures to conduct union representation elections electronically, severely impacting the ability to ensure free and fair union elections.

 

While the bill is unlikely to become law, the Democrats spending bill have been criticized by Republicans for busting budget caps and containing poising pill riders that would defund the pro- economic growth policy priorities achieved through the regulatory process.

 

ABC Supports Kaplan’s Re-nomination to the NLRB

 

On July 30, the U.S. Senate confirmed Marvin Kaplan’s re-nomination to the NLRB for a five year term second term. Kaplan has served as a member of the NLRB since he was confirmed by the Senate on Aug. 2, 2017. During his service on the board, ABC believes that Kaplan has interpreted the National Labor Relations Act (NLRA) in a manner that is fair to workers, unions, and created a climate for economic growth.

 

ABC was pleased with the Senate’s confirmation and looks forward to Marvin Kaplan’s continued service on the NLRB. To read ABC’s letter of support click here.

 

Economy Struggles as Relief Deal Eludes Congress:

 

The U.S. economy suffered its sharpest downturn since at least the 1940s in the second quarter, highlighting how the pandemic has ravaged businesses across the country and left millions of Americans out of work. Meanwhile, Congress has been unable to come to an agreement on an additional relief package that would further assist individuals and struggling businesses during this crisis.

 

Gross domestic product shrank 9.5% in the second quarter from the first, a drop that equals an annualized pace of 32.9%, the Commerce Department’s initial estimate showed on Thursday. That’s the steepest annualized decline in quarterly records dating back to 1947 and compares with analyst estimates for a 34.5% contraction. Personal spending, which makes up about two-thirds of GDP, slumped an annualized 34.6%, also the most on record.

ABC’s Construction Confidence Index indicates that a majority of contractors suffered some form of interruption to their activities during the second quarter, whether due to a lack of available inputs as global supply chains buckled, project postponements or cancellations, jobsite workforce issues or state and local government mandates.

A separate report Thursday showed the number of Americans filing for unemployment benefits increased for a second straight week. Initial claims through regular state programs rose to 1.43 million in the week ended July 25, up 12,000 from the prior week, the Labor Department said. There were 17 million Americans filing for ongoing benefits through those programs in the period ended July 18, up 867,000 from the prior week.

 

U.S. stocks fell the most in a week after the data releases, and yields on 10-year Treasuries declined.

 

While the economic restart has helped put 7.5 million Americans back to work in May and June combined, payrolls are down more than 14.5 million from their pre-pandemic peak.

 

Construction Backlog Indicator:

 

During these tumultuous times for ABC member companies and workers, it’s never been more important for provide information on economic conditions so we can help our members understand the market and plan for the future. Please encourage members to complete the Construction Backlog Indicator survey, which was most recently sent on July 20.

 

Please share the sign-up form or this month’s link with any of your members who may have not received it.

 

NLRB Issues Proposal on Employee Privacy and Participation by Workers on Military Leave:

 

On July 29, the National Labor Relations Board issued a proposed rule titled Representation-Case Procedures: Voter List Contact Information; Absentee Ballots for Employees on Military Leave, which proposes two amendments to the representation election regulations under the National Labor Relations Act.

 

According to an NLRB news release, the first amendment would amend the agency’s rules and regulations to eliminate the requirement that employers provide available personal email addresses and home and personal cellular telephone numbers of all eligible voters to the Regional Director and other parties during an election campaign, and the second amendment would provide for absentee ballots for employees who are on military leave.

 

ABC plans to submit comments on the NLRB proposal before the Sept. 28, 2020, deadline and will provide updates on the rulemaking process through Newsline.

 

COVID-19 – U.S. Equal Employment Opportunity Commission:

 

• What You Should Know About COVID-19 and the ADA, the Rehabilitation Act, and Other EEO Laws
   

COVID-19 - Register for the upcoming ABC National webinar on Aug. 4:

 

New COVID-19 Paid Leave Issues for Employers as the Country Reopens

Republicans Enter COVID Relief Negotiations with Weak Hand:

On Tuesday, the Senate GOP finally released the HEALS Act, its $1 trillion coronavirus relief plan. The Senate Republican Policy Committee (RPC) released an overview of the package, which can be viewed here.

Following the release of the package, Senate Republican Leadership ran into issue with rank and file members, who were critical of the proposal. Senate Majority Leader McConnell did not appear to have anything near majority Republican support, let alone backing from Democrats who instantly attacked them, which will make the negotiation process even more difficult for the Leader. “I think it’s a statement of the obvious that I have members who are all over the lot on this,” Senator Mitch McConnell, Republican of Kentucky and the majority leader, told reporters after the closed lunch session. “There are some members who think we've already done enough, other members who think we need to do more. This is a complicated problem.” Senator John Cornyn (R-Texas), the author of the liability protections that Republicans insist should be in any final legislation said of the package, “If it is going to be passed with mainly Democratic votes, it is going to be mainly a Democratic bill.”

Further weakening Republicans’ hand at the negotiation table, President Trump also called the Republican proposal “semi-irrelevant,” noting that it would have to be reconciled with Democrats’ “needs and asks.” Mr. McConnell said it would be up to Mark Meadows, the White House chief of staff, and Steven Mnuchin, the Treasury secretary, to do the reconciling.

 

ABC Calls for Additional Guidance and Flexibility in PPP Rulemaking:

 

On July 27, ABC submitted comments to the U.S. Department of the Treasury and U.S. Small Business Administration on an interim final rule changing key provisions of the SBA’s Paycheck Protection Program and its loan forgiveness and loan review procedures.

While ABC expressed support for several changes to the PPP, such as decreasing the portion of a PPP loan that must be spent on payroll costs from 75% to 60% and increasing the timeline to spend PPP funds from eight weeks to 24 weeks, ABC also urged the agencies to take the following actions in order to further assist small businesses:

1. Provide further guidance on when businesses should apply for loan forgiveness and when they are notified of their forgiveness status
2. Issue further guidance on the PPP audit process
3. Increase flexibility for employee retention requirements and loan forgiveness
4. Provide further clarification of nonpayroll costs
5. Refocus efforts to deliver PPP funds to underserved communities and minority businesses

ABC has followed the implementation and additional revisions to the PPP and submitted comments on a previous rulemaking related to the program.

ABC will continue to provide updates on the PPP and other SBA resources through Newsline and at abc.org/coronavirus.

NLRB Nominees Headed to Floor This Week: 

On Thursday, July 23, Senate Majority Leader Mitch McConnell (R-KY) filed for cloture on the nominations of Marvin Kaplan and Lauren McFerran to the NLRB. We are expecting a final vote on their confirmations this week or next. It is possible that they will be confirmed on a voice vote or via another agreement with Senate Democrats.

Kaplan is currently a Republican Board member and was nominated for a second term. ABC will be sending a letter of support for the Kaplan nomination. His current term expires on August 27. McFerran (D) has served on the Board under both Presidents Obama and Trump. Without confirmation of at least one of these candidates, the Board will no longer have a quorum when Kaplan’s term expires.  

ABC Asks President Trump to Review Policies that Impede Competition and Job Creation:

 

On July 28, ABC sent a letter to President Trump applauding him for issuing two executive orders, Regulatory Relief to Support Economic Recovery and Accelerating the Nation’s Economic Recovery from the COVID-19 Emergency by Expediting Infrastructure Investments and Other Activities, which will help to remove burdensome barriers to job creation and help the economy continue to rebound from the COVID-19 crisis.

 

ABC Election Series—RNC National Update:

 

A reminder that Thursday, July 30th from 3 p.m.-3:30 p.m. EDT ABC will be hosting an election update with the Republican National Committee: CLICK HERE to register. This update is a part of the ABC Election Update Series, which is powered by the Free Enterprise Alliance. The series is reserved for ABC members and registration is free of charge thanks to our generous sponsors. You can find more information about future ABC Election Update Series webinars online here.

 

House Democrats Move Forward with Appropriations Bills:

 

While negotiations continue on the next round of COVID relief from Congress, the House this week is set to pass their second minibus of fiscal year 2021 appropriations bills. The House is expected to consider the legislation, H.R. 7617, beginning today. The package includes six FY 2021 spending bills: Defense, Commerce-Justice-Science, Energy and Water Development, Financial Service and General Government, Labor-HHS-Education, and Transportation-Housing and Urban Development.

 

A division-by-division summary is available as a PDF here.

 

While the bill is unlikely to become law, the Democrats spending bill have been criticized by Republicans for busting budget caps and containing poising pill riders that would defund the President’s priorities.

 

COVID-19 & Face Coverings:

 

An updated list of jurisdictions where face coverings are recommended or required can be read here.

 

OSHA FAQs on cloth face coverings is available here.

 

CDC’s information on the use of cloth face coverings can be found here.

 

REMINDER—What’s in the GOP COVID Relief Proposal:

 

Of note, addressing ABC priorities, the package would:

• Expand PPP eligibility to include certain 501(c)(6) organizations, with 300 or fewer employees, excluding professional sports, political campaigns, and lobbying expenses.
  • Eligibility requirement specify that the organization cannot receive more than 10 percent of receipts from lobbying, the lobbying activities do not comprise more than 10 percent of receipts, and the organization has 300 or fewer employees.
• Expand the Employee Retention Tax Credit (ERTC) from 50 percent of qualified wages reimbursed through the credit to 65 percent.
  • Under the CARES Act, employers are eligible for the ERTC if their (1) operations were fully or partially suspended due to a COVID-19-related shut-down order, or (2) gross receipts declined by more than 50 percent when compared to the same quarter in the prior year. The HEALS Act lowers the amount of the reduction in gross receipts required to qualify as an eligible employer from a 50- percent decline to a 25-percent decline compared to the same calendar quarter in the previous year. The CARES Act limited the amount of qualified wages taken into account per employee to $10,000 for the year, and the HEALS Act increases the limitation on qualified wages taken into account per employee to $10,000 per quarter (limited to $30,000 for the calendar year).
  • The bill also enhances coordination between the credit and the Paycheck Protection Program by allowing employers to be eligible for both programs, but with limitations to prevent overlapping benefits

• Provide liability protections for employers through temporarily limiting liability for personal injuries arising from alleged COVID-19 exposure at a school, college, nonprofit, church, or business. Text of the bill can be found here.
  • In order to qualify, entities must (1) have made reasonable efforts to comply with applicable public health guidelines, and (2) not engage in willful misconduct or grossly negligent behavior.
  • These protections would apply to personal injury lawsuits stemming from actual exposure to coronavirus as well as feared or potential exposure. Nuisance claims will also be covered.
  • Covers coronavirus-related exposure injuries that take place between December 1, 2019 and October 1, 2024.

 

Notably, the bill DOES NOT fix the Paycheck Protection Program tax deductibility issue. ABC has pushed for this issue repeatedly since the IRS’s guidance that excluded the ability of small businesses to deduct eligible expenses paid with a forgiven Paycheck Protection Program (PPP) loan from their taxes. Without this relief, millions of small businesses will face significant tax liabilities and earlier this month sent a letter to Congressional leadership along with more than 100 business organizations. Treasury Secretary Steve Mnuchin has consistently objected to a fix for this critical issue, defending the IRS guidance and stating tax deductibility of PPP loans would be “double dipping” into the program. The fix authored by Sen. John Cornyn (R-Texas) was excluded from the final package due to objections from the White House and Treasury.

 

Continuing the Paycheck Protection Program, the proposal provides $190 billion of committed and appropriated funds to support PPP and PPP Second Draw Loans, and defines eligibility for PPP Second Draw loans as small businesses that meet the applicable SBA revenue size standard, have no more than 300 employees, and demonstrate at least a 50 percent reduction in gross revenues. Critics have said the restriction would leave too many struggling yet viable employers on the sidelines while putting too much emphasis on businesses on the brink of failure. You can view a section by section summary of the provisions here.

 

The proposal also includes a second $1,200 direct payment for Americans. Under the plan, people earning up to $75,000 can receive the full amount. Dependents regardless of age also qualify for $500, expanding the range of people that qualify for cash compared to the initial wave of stimulus checks that left out many adult dependents and college students. The payments phase out for single-filers earning above $99,000, and joint-filers with no children earning more than $198,000. The plan also calls for the reduction in increased federal unemployment benefits from $600 to $200 per week for a 60-day period, or until states are able to provide a 70 percent wage replacement. More information on these provisions and other critical tax provisions in the bill can be found here.

 

The GOP package also provides additional flexibility for the $150 billion in state funds provided under the CARES Act and extends the time frame under which that money can be used. The bill includes $16 billion in new money for expanding state testing capacity — on top of $9 billion that hasn't been spent yet — $26 billion for the development and distribution of vaccines, $105 billion to help schools reopen, $20 billion to assist farmers and ranchers and close to $30 billion to "bolster the U.S. defense industrial base." You can view more information on the emergency funding here.

Senate Republicans Release HEALS Act for Next Round of COVID Relief:

 

Yesterday, the Senate GOP finally released the HEALS Act, its $1 trillion coronavirus relief plan. This package is seen as a starting point for Republicans, teeing up what could be weeks of tough bipartisan negotiations with Democrats to provide much-needed relief in response to the COVID-19 health and economic crisis. ABC will continue to provide updates on these negotiations as they move forward.

 

Of note, addressing ABC priorities, the package would:

• Expand PPP eligibility to include certain 501(c)(6) organizations, with 300 or fewer employees, excluding professional sports, political campaigns, and lobbying expenses.
  • Eligibility requirement specify that the organization cannot receive more than 10 percent of receipts from lobbying, the lobbying activities do not comprise more than 10 percent of receipts, and the organization has 300 or fewer employees.
• Expand the Employee Retention Tax Credit (ERTC) from 50 percent of qualified wages reimbursed through the credit to 65 percent.
  • Under the CARES Act, employers are eligible for the ERTC if their (1) operations were fully or partially suspended due to a COVID-19-related shut-down order, or (2) gross receipts declined by more than 50 percent when compared to the same quarter in the prior year. The HEALS Act lowers the amount of the reduction in gross receipts required to qualify as an eligible employer from a 50- percent decline to a 25-percent decline compared to the same calendar quarter in the previous year. The CARES Act limited the amount of qualified wages taken into account per employee to $10,000 for the year, and the HEALS Act increases the limitation on qualified wages taken into account per employee to $10,000 per quarter (limited to $30,000 for the calendar year).
  • The bill also enhances coordination between the credit and the Paycheck Protection Program by allowing employers to be eligible for both programs, but with limitations to prevent overlapping benefits

• Provide liability protections for employers through temporarily limiting liability for personal injuries arising from alleged COVID-19 exposure at a school, college, nonprofit, church, or business. Text of the bill can be found here.
  • In order to qualify, entities must (1) have made reasonable efforts to comply with applicable public health guidelines, and (2) not engage in willful misconduct or grossly negligent behavior.
  • These protections would apply to personal injury lawsuits stemming from actual exposure to coronavirus as well as feared or potential exposure. Nuisance claims will also be covered.
  • Covers coronavirus-related exposure injuries that take place between December 1, 2019 and October 1, 2024.

 

Notably, the bill DOES NOT fix the Paycheck Protection Program tax deductibility issue. ABC has pushed for this issue repeatedly since the IRS’s guidance that excluded the ability of small businesses to deduct eligible expenses paid with a forgiven Paycheck Protection Program (PPP) loan from their taxes. Without this relief, millions of small businesses will face significant tax liabilities and earlier this month sent a letter to Congressional leadership along with more than 100 business organizations. Treasury Secretary Steve Mnuchin has consistently objected to a fix for this critical issue, defending the IRS guidance and stating tax deductibility of PPP loans would be “double dipping” into the program. The fix authored by Sen. John Cornyn (R-Texas) was excluded from the final package due to objections from the White House and Treasury.

 

Continuing the Paycheck Protection Program, the proposal provides $190 billion of committed and appropriated funds to support PPP and PPP Second Draw Loans, and defines eligibility for PPP Second Draw loans as small businesses that meet the applicable SBA revenue size standard, have no more than 300 employees, and demonstrate at least a 50 percent reduction in gross revenues. Critics have said the restriction would leave too many struggling yet viable employers on the sidelines while putting too much emphasis on businesses on the brink of failure. You can view a section by section summary of the provisions here.

 

The proposal also includes a second $1,200 direct payment for Americans. Under the plan, people earning up to $75,000 can receive the full amount. Dependents regardless of age also qualify for $500, expanding the range of people that qualify for cash compared to the initial wave of stimulus checks that left out many adult dependents and college students. The payments phase out for single-filers earning above $99,000, and joint-filers with no children earning more than $198,000. The plan also calls for the reduction in increased federal unemployment benefits from $600 to $200 per week for a 60-day period, or until states are able to provide a 70 percent wage replacement. More information on these provisions and other critical tax provisions in the bill can be found here.

 

The GOP package also provides additional flexibility for the $150 billion in state funds provided under the CARES Act and extends the time frame under which that money can be used. The bill includes $16 billion in new money for expanding state testing capacity — on top of $9 billion that hasn't been spent yet — $26 billion for the development and distribution of vaccines, $105 billion to help schools reopen, $20 billion to assist farmers and ranchers and close to $30 billion to "bolster the U.S. defense industrial base." You can view more information on the emergency funding here.

The ABC Election Briefing Series:

 

This week, ABC members are invited to an exclusive update from the Republican National Committee on Thursday, July 30, at 3 p.m. EDT, where we will be joined by Chris Carr, the political director for Trump Victory, and Elliott Echols, the national field director at the RNC. RSVP Today: CLICK HERE.

The ABC Election Briefing Series is free of charge and reserved for ABC members only. Webinars will not be recorded. Sponsorship opportunities are available. Please contact Melanie Pfeiffenberger for more information at pfeiffenberger@abc.org or (202) 595-1813.

 

GOP Set to Release COVID Relief Package Today:

 

Republican leadership in the Senate is planning to release their legislative package on additional COVID relief later today. Initital reports indicate that Senate Republicans will propose cutting weekly federal emergency unemployment benefits from $600 to $200, and the package is expected to include a new round of $1,200 checks to individual Americans, billions of dollars for schools with some of the money aimed at helping classrooms reopen, and a five-year liability shield for businesses, health-care providers and others.

 

The legislation also is set to include at least $100 billion more for the small-business Paycheck Protection Program and is expected to extend a limited moratorium on evictions. It does not contain any new money for state and local governments — a key Democratic demand — but instead gives state and local leaders additional flexibility in spending the $150 billion approved in the CARES Act in March.

 

This proposal will just be the starting point for Republicans who will be negotiating with Democrats and their $3 trillion plan passed by the House  back in May.

 

Senate Majority Leader Mitch McConnell (R-Ky.) acknowledged Friday that a deal with Democrats could take several weeks, while Pelosi said Congress can’t leave for August recess without passing a bill. Meanwhile, Sen. Lindsey Graham (R-S.C.) said over the weekend: “Half the Republicans are going to vote no to any Phase 4 package,” making bipartisan negotiations more difficult for Republican leadership.

 

Reminder—ABC Action Alert on COVID Relief Priorities:

 

Last week, ABC sent out an action alert to members highlighting critical priorities to include in the next COVID-19 relief package that is currently being negotiated in Congress. 511 ABC members have sent a total of 1,540 messages to their elected officials, reaching 90 U.S. Senators and 213 representatives.

 

ABC has previously sent letters to Congressional leadership and rank and file members of Congress on these important issues for the construction industry. Please click the link here and send the alert to your Representative and Senators. This is likely the last large package to address the pandemic ahead of the November elections, and ABC continues to advocate for critical policies that will support our members and the construction industry including aid for 501(c)(6) organizations, tax deductibility for Paycheck Protection Program loans, limited liability protections for construction businesses operating during the pandemic, and the continuation, extension, and expansion of critical tax relief for businesses.

 

GOP Reaches Agreement in Principle on CARES 2, Details to Come Next Week:

 

Last night, Senate Majority Leader Mitch McConnell announced that the Senate majority had assembled a framework for CARES 2, that the White House has requested additional time to review. McConnell also announced that the Senate would be releasing this proposal early next week, stating “We have an agreement in principle on the shape of this package. It is the framework that will enable Congress to make law and deliver more relief to the American people that is tailored precisely to this phase of the crisis.” View full statement here.

 

According to reports, the hang up on releasing the package this week centered around the extension of federal unemployment assistance for workers that have lost their jobs as the United States economy shut down in response to the coronavirus pandemic. There is currently some conflicting info coming out on this issue and it is unclear at this time where the final language will land:

 

• Congress settled on the $600 sum in the first relief package that passed in March because, when added to the average state unemployment payout in 2019 ($378) it equates approximately, though a little more than, the average American worker per week salary of $933, according to the Bureau of Labor Statistics. 

 

• Treasury Secretary Steve Mnuchin told CNBC Thursday that the GOP plan would extend the benefits “based on approximately 70% wage replacement,” though it’s not clear what he meant. A 70% wage replacement based on average worker wages in the U.S. would translate to federal payouts of around $200-$300 per week, a significant cut from the $600 per week in jobless benefits being paid out by the federal government.

 

• Sen. Lindsey Graham (R-S.C.) also told the Wall Street Journal that Republican lawmakers were looking at lowering the payouts to 70% of the $600 per-week figure, which would equate to $420 a week.

 

House Passes Appropriations Minibus Today:

 

The House passed today its four-bill spending package that would fund both EPA and the Interior Department for fiscal 2021, H.R. 7608, after adding more than 100 amendments to the package on Thursday. House Democrats adopted partisan provisions to their first fiscal 2021 minibus on Thursday, including an amendment to bar drilling in the Arctic National Wildlife Refuge, provide more funding to replace lead drinking water lines and block a host of Trump administration regulatory efforts, including the ABC supported NEPA reforms. The bill also exceeds, by billions of dollars, current budget agreement spending caps that had been agreed upon with bipartisan support. The bill passed by a vote of 224-189 with no Republicans voting for and 7 Democrats voting against.

 

The bill is more than likely dead on arrival in the Senate, which is unlikely to take up the House’s appropriations efforts this year.

 

There will be also no payroll tax cut sought by Trump in the new plan.

 

Paycheck Protection Program (PPP) Policy Update:

 

SBA has recently released additional guidance SBA Procedural Notice: Procedures for Lender Submission of Paycheck Protection Program Loan Forgiveness Decisions to SBA and SBA Forgiveness Loan Reviews (Released July 23, 2020)

• The PPP Forgiveness Platform will go live and begin accepting Lender submissions on August 10, 2020, subject to extension if any new legislative amendments to the forgiveness process necessitate changes to the system.

 

Please note the following document was released earlier this week:

SBA Information Notice on Guidance Regarding Identification and Reporting of Suspicious Activity in the COVID-19 EIDL Loan Program  (Released July 22, 2020)