McConnell's $500B skinny stimulus includes more unemployment, coronavirus-liability protections

$500B is a far cry from the $2.4T initial plan

Even as some Republicans — namely White House officials — want to go big with a new COVID-19 stimulus plan, Senate Majority Leader McConnell is working on passing a much smaller bill that will likely be up for a vote on Wednesday. According to an initial draft of the legislation obtained by FOX Business, McConnell is looking to spend less than $500 billion in targeted stimulus.

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The White House and Speaker of the House Nancy Pelosi meanwhile want to pass a bill that will cost somewhere between $1.8 trillion and $2.4 trillion and offer broader relief including individual stimulus checks and state aid. Treasury Secretary Mnuchin and Pelosi spoke this afternoon; after the meeting, Pelosi's spokesman tweeted they will have clarity about whether a bill can be passed before the election by tomorrow.

Stocks finished lower today as the skinny bill — a much smaller version of the package markets had been hoping for — appears the only possible option left.

TickerSecurityLastChangeChange %
I:DJIDOW JONES AVERAGES29638.64-271.73-0.91%
SP500S&P 5003621.63-16.72-0.46%
I:COMPNASDAQ COMPOSITE INDEX12198.737037-7.11-0.06%

The key provisions in the McConnell legislation include more funding for the Paycheck Protection Program, educational assistance including short-term aid to childcare facilities, additional unemployment benefits, and forgiveness of postal service loans. Perhaps most important for McConnell, the bill creates broad liability protections for businesses looking to reopen amid the pandemic. A key statute in the bill protects businesses from possible COVID related lawsuits.

Here are some key provisions:

  • “It includes liability limitations for COVID-related personal injury claims against businesses, COVID-related medical malpractice claims, expansion of PREP Act to cover additional countermeasures, and protections from liability under labor and employment laws for businesses that help fight COVID.”
  • “Creates a 2nd round of PPP with reforms to require new applications show revenue loss and maintain loan documents consistent with IRS requirements. Provides additional resources for audits.”
  • “This provision gives states the option to continue providing $300/week in extra, federally funded unemployment benefits to those who qualified under the CARES Act through December 27. It also extends the authorization for railroad unemployment benefits through December 27.”
  • “The provision would forgive the USPS $10 billion Treasury loan authorized in CARES. The loan is accessible only if the USPS cash balance drops to $8 billion and includes a report to Congress on how COVID has increased expenses. This provision mirrors the offer made to Democrats by the administration.”
  • “Authorizes improvements and supports for sustained on-shore manufacturing surge capacity and capabilities to produce needed medical countermeasures, such as vaccines and therapeutics, to respond to public health threats like COVID-19.”
  • “Extends the deadline to Sept 30, 2021, for spending already appropriated money. No additional flexibility or funding.”

The McConnell proposal would also reclaim unused funds from the last bill — $146 billion from the CARES Act — and reallocate them to the new bill.

“This bill is still in process,” one person with knowledge of the legislative process was quick to tell FOX Business. People with knowledge of the matter are optimistic targeted aid can get passed but remain cautious.

Press officials for McConnell and Pelosi did not respond to a request for comment. In a statement to FOX Business, the White House said "There is no one more committed to delivering relief for workers than President Trump, and the White House will continue working around the clock to make it happen—reaching out to both Republicans and Democrats in the process."