BY THE NUMBERS
Number of Statewide Cases: 23,146 (+643)
Marion County Cases: 7,078 (+164)
Hamilton County Cases: 902 (+8)
Johnson County Cases: 769 (+15) US Cases: 1.26M
Global Cases: 3.9M
Number of Statewide Deaths: 1,328 (+33) Number of Marion County Deaths: 403 (+5) US Deaths: 75,858 (+2,285)
Global Deaths: 270,537 (+5,858)
Number of new Hoosiers Filing for Unemployment: 43,777 as of 5/7/20
Update from DC - Looking Forward: House Democrats to Release CARES 2 Proposal
As anticipated, House Democrats are preparing for House operations to resume and moving quickly on a CARES 2 legislative proposal. We anticipate House Democrats will release their proposal in the next few days. Members will likely return to Washington and vote on the package the week of May 18th. Philosophical and partisan differences remain and adoption of new CARES legislation is at least several weeks away if the differences can be bridged with Senate Republicans and the Trump Administration.
House Of Representatives: Speaker Pelosi has consulted with Committee Chairman and the various caucus’ within House Democratic ranks to craft a CARES 2 proposal. House Democrats have insisted the next package will have significant funding for states and local governments as well as additional healthcare monies including funds for COVID testing, contact tracing and the testing supply chain. Additional funding for the Paycheck Protection Program (PPP) is planned though the Democrats will continue to press for the PPP monies to reach underserved communities, address program criticisms through new clarifying language and provide additional Economic Injury Disaster Loan (EIDL) monies. Another round of food assistance funding through SNAP is also expected in the proposal. While discussions on the Democratic side are ongoing and fluid, we anticipate the proposal to include additional priorities identified by the following committees:
- At least $875 billion in assistance to state, county, local and tribal government funding. Earlier reports indicated the requests for funding for state and local governments could exceed $1 trillion.
- Stabilization funding for K-12 and higher education, tribal and rural communities, and additional monies for Community Development Block Grants.
- Funding for state DoT’s and mass transit systems.
- Funding for 2020 national election including funds to encourage vote by mail.
- Postal Service funding.
EDUCATION AND LABOR
- Hazard pay funding for frontline workers.
- Expansion of OSHA for essential workers.
- Student loan debt relief.
- Subsidized COBRA benefits.
- Education funding through the state, local and tribal mechanisms.
ENERGY AND COMMERCE
- Broadband expansion.
- Enforcement of price gouging.
- Consumer protections against shutoffs of utilities of water, electric, gas.
- Funding for national testing, supply chain improvements and contact tracing.
- Ban on foreclosures and evictions.
- Ban on negative credit reporting.
- PPP reforms to include how financial institutions are paid for loans.
- A $75 billion homeowner assistance fund.
- A $100 billion emergency rental assistance fund.
- Additional student loan assistance.
- Additional PPP funding, including monies for community and microlenders and nonprofits.
- Extend PPP loans through at least end of August.
- Extend loan term to 5 years, lower fees, and clarify loan forgiveness.
- More funding for EIDL.
WAYS AND MEANS
- Extension of the unemployment insurance time period.
- Expansion of the employee retention tax credit.
- Bolster multiemployer pension plans.
- Childcare assistance for frontline workers.
- Second round of stimulus checks.
United States Senate: Majority Leader Mitch McConnell has signaled the Senate will take a very different approach to additional COVID-19 response and recovery legislation. The Majority Leader has prioritized liability protections for business interests stating earlier this week, “If there’s a redline, its on litigation.” McConnell and Republicans continue to express reservations about large scale funding to states and local governments, the urgency for new funding as the economy is still absorbing recently approved assistance, and the long-term impacts of deficit spending to address the current crisis. Senate Republicans are also working towards alignment with the Trump Administration to strengthen any negotiations with House Democrats.
Path Forward: We anticipate a protracted negotiation between the House, Senate and Administration (Secretary Mnuchin). Developments over the next several weeks to manage the coronavirus and open the economy will influence talks between Democrats and Republicans. Still, it seems it will take several weeks and likely the balance of May or longer to reach a new bipartisan CARES agreement.
Pelosi Expected to Release Coronavirus Relief Package as Soon as Today
Speaker Nancy Pelosi (D-CA) and House Democrats are finalizing a second multitrillion-dollar relief package that is expected to increase funding for state and local governments, expand unemployment insurance, and add another round of direct payments to U.S. taxpayers in the wake of the coronavirus.
Additional provisions of the House bill are expected include increased access to COVID- 19 testing, funding for vote by mail programs and the Postal Service, expanded access to broadband access for rural communities, and hazard pay for frontline workers. The legislation is also expected to include additional funding for the Paycheck Protection Program (PPP), additional student loan debt relief, and increased rental and housing assistance.
There is no indication the bill will include liability protections for businesses, which Senate Majority Leader Mitch McConnell (R-KY) says must be included in any future relief package. Speaker Pelosi has not yet negotiated with Leader McConnell or the Administration, whose priorities have focused on tax relief in the form of payroll tax cuts.
Speaker Pelosi is expected to unveil the legislation as early as this afternoon. The House remains out of session, and Members will be given 24 hours’ notice of expected legislative action on the floor. The House could return as early as next week to vote on the bill, though many Members remain concerned about traveling to Washington. The Speaker has been unable to reach an agreement with House GOP Leadership on amending House rules to permit remote voting. Republicans have called on Pelosi to consider remote voting as
well as develop a plan for Members to safely return to Washington before addressing any legislation.
CMS Releases Interim Final Rule for Nursing Homes
The Centers for Medicaid and Medicare Services (CMS) has published an interim final rule that will require nursing homes to report coronavirus facility data to the CDC, as well as facility residents, their representatives, and families of residents. CMS has also made updates to safety protocol reporting requirements for COVID-19 data. The interim final rule and updated reported requirements is here.
HHS Extends Deadline for Provider Relief Fund to 45 Days
The Department of Health and Human Services (HHS) has extended the deadline for healthcare providers to certify the receipt of payments from the Provider Relief Fund. Providers now have 45 days from the date they receive payment to attest and accept the Terms and Conditions or return the funds. The Provider Relief Fund was authorized by CARES and provides $175 billion in relief funding to hospitals and healthcare providers across the country. The press release from HHS is here.
Department of Commerce Announces Economic Development Assistance Program Commerce Secretary Wilbur Ross has announced the creation of the CARES Act economic development assistance program. The program will be administered through the Economic Development Administration (EDA) at Commerce, which received $1.5 billion in economic assistance grant funding under the CARES Act. Grants will be made through the EDA’s Economic Adjustment Assistance (EAA) program, which will assess the needs of local and regional stakeholders. The grants are expected to support a range of construction and non-construction projects in communities across the country. Information on how to apply is here.
McCarthy Announces GOP Members of House Coronavirus Oversight Committee On Monday, House Minority Leader Kevin McCarthy (R-CA) announced GOP members that will serve on the House Select Committee on Oversight of the Coronavirus. The group includes House Minority Whip Steve Scalise (R-LA), Reps. Luetkemeyer (R-MO), Jordan (R-OH), Walorski (R-IN) and Green (R-TN). Leader McCarthy also announced creation of a House Republican China Taskforce to address the nation’s role in the pandemic, as well as to consider broader policy challenges created by China. The Taskforce will be led by House Foreign Affairs Ranking Member Mike McCaul (R-TX).
Answers to 6 Thorny Questions That Could Prevent Loan Forgiveness
The U.S. government is now almost two weeks behind schedule on answering a crucial question: How can Paycheck Protection Program (PPP) loan recipients get their loans forgiven? The program’s forgiveness rule sounds simple: Spend at least 75 percent of the funds on payroll within an 8-week period to get your loan forgiven. But it’s more complex than it appears, and despite the government saying it would issue clarifying guidance by April 26, borrowers are still waiting. So on Thursday, Inc. editor-at-large Kimberly Weisul called up a series of finance and legal experts to ask how they’d address six of the most common points of confusion. For example: If you got a PPP loan but you’re still closed, can you ask your employees to take all their paid vacation time now? The answer: You likely need to mirror what you’ve done in prior years. If you run an accounting firm, and taking vacations in May and June is pretty normal, you might be in luck. But if you ask employees to take vacations simply because you have no work for them to do, you’re unlikely to have that money forgiven. These are crucial questions, and addressing them without help can be seriously challenging. Read Weisul’s story to get the answers on loan forgiveness you need.
U.S. Unemployment Rate Soars to 14.7 Percent, The Worst Since the Depression Era
20.5 million people lost their jobs in April, the Labor Department said Friday. Many analysts believe it could take years to recover. The U.S. unemployment rate jumped to 14.7 percent in April, the highest level since the Great Depression, as many businesses shut down or severely curtailed operations to try and limit the spread of the deadlycoronavirus. The jobless rate was pushed higher because 20.5 million people abruptly lost their jobs, the Labor Department said Friday, wiping out a decade of job gains in a single month. The staggering losses are roughly double what the nation experienced during the 2007-09 crisis, which had previously been measured as the worst downturn since World War II. But the economic trauma caused by the pandemic has already surpassed that. As the virus’s rapid spread accelerated in March, President Trump and numerous governors took steps to put the economy in deep freeze through April in an effort to minimize the spread. This led businesses to suddenly shed millions of workers each week. Analysts warn it could take many years to return to the 3.5 percent unemployment rate the nation experienced in February in part because it’s unclear what a new economy will look like even if scientists make progress on a vaccine, testing, and treatment.
States Face Economic Death Spiral
As states move toward reopening, the economic ramifications of the shutdown will haunt them far into the future, Axios' Stef Kight reports.
- Why it matters: The virus is devastating states' revenue streams — and could force choices between raising taxes, or gutting services and laying off public employees.
What to watch: Sens. Bob Menendez (D-N.J.) and Bill Cassidy (R-La.) plan to introduce legislation as soon as next week to create a $500 billion fund designed to help struggling state and municipality budgets.
The Urban Institute has been compiling lost revenue data as states make it publicly available.
- The data shows collections dropping between 20% and more than 50%, depending on the state, senior researcher Lucy Dadayan tells Axios.
- California's staggering tax revenue loss due to the pandemic has led to an expected $54.3 billion budget shortfall through FY 2021, Gov. Gavin Newsom announced yesterday — after a $21 billion surplus last year.
Between the lines: Democratic-leaning cities have seen the highest case and death rates, but red and blue states alike are facing serious budget shortfalls.
- That's why some Republican senators are getting behind efforts to provide federal dollars to help states balance budgets.
Much of the burden will likely be pushed on struggling local governments.
- Cities have lost hotel occupancy fees, inspection fees and construction fees.
- Some could be forced to lay off public workers needed to combat the virus and keep the public safe — such as firefighters, paramedics and public hospital workers.
UPDATE: Indiana’s April Revenue Nearly $1B Below Budget Projections
Revenue for the state of Indiana came in almost $1 billion lower than expected in April, with a significant decrease in individual income taxes accounting for the largest portion of the discrepancy. The April revenue report, released Friday afternoon, showed individual income tax collections were nearly $669 million lower than projections, missing the mark by about 58%.
Income taxes make up the second-largest revenue stream for the state, accounting for nearly 40% of state tax collections. Cris Johnston, director of the Office of Management and Budget, said his office is working with the State Budget Committee to produce an updated revenue forecast this summer, and state agencies are being asked to identify potential spending cuts. “Needless to say, the remainder of the fiscal year will be challenging,” Johnston said Friday afternoon.
In addition to record-high numbers of individuals filing for unemployment, the decision to delay the income tax filing deadline from April 15 to July 15 is causing the lower-than-expected collections. Other revenue sources also were lower than expected in April. Sales taxes, which represent nearly 50% of state tax collections, were $103.3 million below the monthly projection. Corporate taxes were $135 million below projections, and other taxes were $8.3 million below monthly expectations. The state received zero income from gambling taxes because the state’s riverboat casinos and horse-track racing casinos have been closed since mid-March. Projections showed the state should have collected nearly $48 million from casinos in April. Overall, tax revenue was 44% lower than predicted. The state estimated it would collect nearly $2.2 billion in revenue in April this year, but it only received $1.23 billion, for a difference of $964 million.
In March, after revenue was 6% lower than expected, the state budget still managed to be slightly ahead of estimates for the year. But now, the budget is about 7% below estimates for the year. Year-to-date, the state expected to have collected $13.57 billion by now, but has only collected $12.6 billion. All of the estimates are based on the budget forecast from December. State budget officials had expected the April monthly revenue report to be worse than March and to start to show the fiscal impact from the coronavirus pandemic. May and June reports are also expected to show lower revenue than anticipated. “Going into May and June, significant fluctuations are expected and deviations from monthly estimates are likely as the rapidly changing economic outlook will most likely impact monthly collections,” the monthly report says. “Additional uncertainty will persist over the coming months, particularly with individual income tax and corporate taxes, with the alignment of Indiana’s tax filing and payment due date with the federal deferral to July 15.” Even though sales taxes missed their mark for the past two months, year-to-date, they are less than 1% below projections.
Part of that might be due to a loophole in online sales and hotel tax collections that state lawmakers worked to close last year. The law requires so-called “marketplace facilitators” that sell goods or services online on behalf of other entities to collect and remit sales tax to the state. Indiana passed a law in 2017 that required online retailers with sales of at least $100,000 or more than 200 customers in the state to collect and remit the state’s 7% sales tax, but that law did not address marketplace facilitators such as Amazon or Expedia. The legislation also required short- term rentals, such as those on platforms like Airbnb or VRBO, to collect sales and innkeeper’s taxes. “While it is difficult to identify the specific impact of the state enforcement of the recent changes in the taxation of remote sales on the fiscal year-to-date tax collections, some data on revenue collections attributable to compliance from marketplace facilitators may suggest an uptick in April,” the report said.
Expanded Jobless Aid On The Way - Payments Begin Going Out Today, Official Says Indiana unemployment officials said Thursday that payments to Hoosiers who traditionally had been ineligible to receive benefits will begin today. Those people include independent contractors, self-employed or those with limited work histories. A federal act expanded coverage to help more people, but the state had to revamp its software. Fred Payne, head of the Indiana Department of Workforce Development, said payments start today and will be sent in batches to the 75,000 successful applicants. “So, if you don't see a payment in your account, don't fret. It's on its way,” he said. Payne also updated Hoosiers on overall unemployment payments since the beginning of April – $986 million has been sent to people. He said improvements are being made in the call center and in getting claims out but conceded “we're not making those payments fast enough but we will get there.” Payne promised that every Hoosier who is eligible will get their money.
State Pays Out Nearly $1B in Unemployment Claims
Indiana Department of Workforce Development Commissioner Fred Payne said Thursday that $986 million in claims have been paid to unemployed Hoosiers since the beginning of April. The state hit a record in April, making 1.4 million unemployment insurance payments totaling $749 million. So far in May, the state has made 313,000 payments totaling $237 million. So where does the state’s unemployment trust fund stand? It has about $600 million in it.
When asked whether the state will need to borrow money from the federal government to cover unemployment benefits, Payne wasn’t ready to say yes but said the department is closely monitoring those funds. During the Great Recession, many states, including Indiana, had to borrow funds from the federal government in the form of Title XII loans.
Casinos to Remain Closed Until Mid-June
The Indiana Gaming Commission says casinos are likely to stay closed until at least mid-June after the state enters Phase Four of its "Back On Track" plan. In a brief statement on its website, the commission said, “No reopening dates have been determined at this time, as the decision is dependent upon information that is not yet available.”
Links to all executive orders may be found here: https://www.in.gov/gov/2384.htm
Link to the Stay-At-Home Order FAQ may be found here: https://www.in.gov/gov/3232.htm
More information may be found at the ISDH website at in.gov/coronavirus/ and the CDC website at https://www.cdc.gov/coronavirus/2019-ncov/index.html.