SS+D COVID-19 Response Team: Coronavirus Update March 18, 2020
March 18, 2020 | Sebaly Shillito + Dyer
FEDERAL UPDATE – CONGRESS PASSES EMERGENCY FUNDING TO ADDRESS PANDEMIC
Late today, the Senate approved the Families First Coronavirus Response Act (H.R. 6201), a new round of emergency funding to address the coronavirus pandemic. The legislation is headed to President Trump, and he is expected to sign it soon. The emergency funding bill marks the second such aid package in a matter of week
We are working diligently to analyze and provide more specific information about the Families First Coronavirus Response Act as it becomes available. It has been reported that the relief bill will, among other things:
- Ensure free COVID-19 testing;
- Bolster unemployment insurance;
- Increase federal spending on health insurance for the poor;
- Add $1 billion in food aid;
- Provide paid sick days for some (but not all) employees throughout the course of the coronavirus crisis; and
- Provide three months of paid emergency leave throughout the course of the coronavirus
To help offset the costs for employers, businesses would be reimbursed for some of these costs through tax credits. Big businesses (those with more than 500 employees) are exempted from offering their employees paid sick leave or family leave under the bill.
Last week, the Senate approved a $8.3 billion House-passed measure that focused on vaccine research and development. H.R. 6201 marks the second such bill to be passed in response to the pandemic. Efforts are already underway to put together a third, larger relief measure that could total $1 trillion, described below.
More details the Families First Coronavirus Response Act will follow as they become available.
FEDERAL UPDATE – WHITE HOUSE WORKING WITH CONGRESS ON “THIRD” EMERGENCY STIMULUS PACKAGE
White House officials are discussing an emergency stimulus package that could send two $1,000 checks to many Americans and also commit $300 billion towards helping small businesses avoid mass layoffs. It is clear that some individuals would not qualify for stimulus payments if their income is over a certain level.
The White House would aim to spend another $50 billion to help rescue the airline industry and $150 billion to prop up other sectors, which could include hotels and hospitality businesses that have been hit hard by the pandemic.
It has been reported that the purpose of the $300 billion for small businesses would be to help firms continue paying employees.
We believe at this point in time that the proposed payroll tax cut is unlikely due to lack of support from Congress and the length of time that would be need for any resulting benefits to filter through the economy.
Negotiations are now occurring in Congress as to what such a stimulus would look like.
A USEFUL RESOURCE TO “STAY IN THE KNOW”
We have identified a very useful (and accurate) resource for you to stay abreast of federal, state, and local legislative measures being taken in connection with COVID-19. Information about various measures being taken by federal, state, and local branches of government can be found here: https://coronavirus.skoposlabs.com/
FEDERAL UPDATE – PRESIDENT INVOKES DEFENSE PRODUCTION ACT
Today, President Trump announced that he will invoke the Defense Production Act, which would allow the administration to force American industry to manufacture medical supplies that are in short supply in the fight against the coronavirus pandemic. “There’s never been an instance like this where no matter what you have it’s not enough,” Trump said at a White House briefing with reporters. “If we need to use it, we’ll be using it at full speed ahead,” he said.
Of top concern to health workers in the U.S. is the shortage of N95 respirators, which are viewed as more effective at blocking viruses than the looser-fitting surgical masks.
While there is a current emphasis on medical supplies, the Defense Production Act authorizes action that is much broader in scope. It can require businesses to contract with the government to provide other kinds of necessary services, materials, and goods on the order of the president. The Act also prohibits hoarding for the purpose of price gouging of any materials the president deems to be scarce.
In a separate update, we will provide more information regarding the Defense Production Act and what it might mean for Ohio businesses.
FEDERAL UPDATE – TRUMP ADMINISTRATION CLOSES U.S.-CANADA BORDER FOR “NON-ESSENTIAL TRAFFIC”
President Trump announces today that the border between the U.S. and Canada is temporarily closed to non-essential traffic, but he said the closure will not affect trade.
FEDERAL UPDATE – PRESIDENT TO REQUIRE HUD TO SUSPEND FORECLOSURES UNTIL APRIL
President Trump announced today that the Department of Housing and Urban Development (HUD) is suspending all foreclosures and evictions until the end of April 2020.
FEDERAL UPDATE – HHS TO ISSUE REGULATIONS ALLOWING DOCTORS TO PRACTICE ACROSS STATE LINES
Vice President Mike Pence announced today that the U.S. Department of Health and Human Services will issue a regulation allowing physicians and other medical professionals to practice across state lines to meet the needs of hospitals and other medical facilities.
FEDERAL UPDATE – WHITE HOUSE RECOMMENDS DELAYING ELECTIVE SURGERIES
Vice President Mike Pence announced today that the Federal Government is recommending that physicians and hospitals across the nation delay elective procedures “to ensure that medical supplies and medical capacity go where they’re needed most.”
NEVADA JOINS THE EXPANDING LIST OF STATES AND/OR CITIES REQUIRING BUSINESS CLOSURES; WE THINK OHIO WILL FOLLOW
Today, Nevada joined the likes of Florida, North Carolina, New York, New Jersey, Connecticut, California, Ohio, Illinois, Massachusetts, Michigan, Pennsylvania, and Washington by ordering the closure of bars, restaurants, and wineries to stem the spread of the virus. The most striking part of this declaration is that the Nevada order includes casinos, which are a significant portion of the Nevada economy and tax base, and lasts for 30 days.
Governor DeWine has been among the leading governors in the country sounding the alarm about the threat of the coronavirus, so we do anticipate a similar order will be put in place in Ohio by Governor DeWine that covers “nonessential businesses.” We anticipate this order going far beyond the existing order requiring the closure of Ohio bars and restaurants. We have no estimated timeline for the same, but we are analyzing other state closure orders to attempt to predict what Ohio businesses will (or will not) be forced to close.
GENERAL STATUS UPDATE
More than 200,000 cases of the coronavirus have been confirmed worldwide, including 6,500 cases in the United States, according to Johns Hopkins University data. Of the 115 people who have died in the U.S., most were elderly or had underlying health conditions. The Federal Government’s push for social distancing continues. In light of the CDC’s new guidelines this week recommending people avoid gatherings of more than 10 people and work from home if possible, we believe an outright ban on “discretionary travel” is a possibility in the near term.
We are also monitoring the various proposals from the federal, state, and local governments regarding loans and other economic stimulus plans related to the pandemic. We will provide more updates on these as they become available.
ABOUT THE SS+D COVID-19 RESPONSE TEAM
The SS+D COVID-19 Response Team was formed to provide clients, colleagues, and friends of the Firm updates for the foreseeable future on COVID-19 issues facing businesses, executives, and employees. Please let us know if there are any items/issues you would like for us to track or summarize.