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Tracking the Latest Stimulus Package

on Friday, 5 February 2021 in Covid-19 Information Hub

Another COVID-19 stimulus package is in the works on Capitol Hill.  On February 5, 2021, the U.S. Senate passed a budget resolution paving the way for a $1.9 trillion COVID-19 relief package.  This vote is one of several procedural steps needed to pass a new stimulus package using the budget reconciliation process, which is a procedural mechanism through which legislation can avoid a filibuster in the U.S. Senate and pass with 51 votes. 

The budget resolution does not become law.  Rather, it is a “shell bill” that directs congressional committees to draft legislation.  Though we do not yet know what the final stimulus package will look like, President Biden has called for $1,400 direct payments, $400 per week in federal unemployment benefits, $350 billion for state and local governments, and an increase to the federal minimum wage from $7.25 to $15 per hour.  Notably, Republicans are signaling that they do not believe that the minimum wage component of the bill compiles with reconciliation rules and not all Democrats have signaled support for this specific component.

Now the budget resolution goes to the House of Representatives, where it is expected to pass.  Next, committees in both the House and the Senate get to work crafting the legislative text.  By February 16, 2021, those committees must submit their legislative recommendations to their respective Budget Committee (i.e., the Senate Budget Committee and the House Budget Committee).  Each Budget Committee will package the legislative recommendations from their respective committees and report out an omnibus package for consideration to their respective chamber.  Any differences in the legislation passed by the House and the Senate must be reconciled before going to President Biden for his signature.  This could involve the appointment of a conference committee from both the House and Senate to negotiate and submit the package to each chamber for an “up or down” vote, meaning no amendments are allowed. 

Budget reconciliation is a procedurally complicated process that takes some time to complete.  Meanwhile, Democrats and Republicans could negotiate a bipartisan package that could pass through normal voting procedures.     

A few takeaways:

  • The budget resolution passed by the Senate and eventually the House will not become law; it is simply an early procedural step in the budget reconciliation process.
  • We must wait until congressional committees prepare their relevant legislative sections before we know what to expect in the final package, and still, changes can happen after they report out their text.
  • A bipartisan package is not necessarily off the table.
  • Expect the budget reconciliation process to take several weeks, if not a month, to complete.

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