The $3 trillion bill which passed May 15 includes retirement provisions advocated by the American Retirement Association. While it has already been declared “dead on arrival” in the Senate, that’s not the end of the story.
The House of Representatives approved the “Health and Economic Recovery Omnibus Emergency Solutions (HEROES) Act” (H.R. 6800) by a vote of 208-199, with 14 Democrats voting against the bill.
The 1,800-page bill provides nearly $1 trillion to state and local governments, adds funding for Coronavirus testing, provides additional direct payments of up to $1,200 per individual, extends unemployment benefits and housing and food assistance, and requires employers to develop and implement infectious disease exposure control plans.
Included among the retirement-based provisions are additional relief from required minimum distributions, clarifications to the retirement provisions enacted under the CARES Act, funding relief for single-employer pension plans, relief for troubled multiemployer pension plans and an assortment of other changes.
The House bill also clarifies that expenses paid or incurred with forgiven loans under the Paycheck Protection Program pursuant to the CARES Act that are not included in gross income do not result in a denial of any deduction or basis of any asset for federal tax purposes.
Even before the bill had passed the House, Senate Republican leaders expressed opposition, noting that it was a grab bag of longstanding Democratic priorities. President Trump indicated that he would veto the bill if it were presented to him in its current form. While noting that he had already signed nearly $2.5 trillion in spending to deal with the pandemic, the president said in a statement on the HEROES Act that the legislation “is more concerned with delivering on longstanding partisan and ideological wish lists than with enhancing the ability of our Nation to deal with the public health and economic challenges we face.”
Visit our Coronavirus resource center!
Next Steps
The HEROES Act is now pending in the Senate, where it is clear that it will not pass in its current form. And while Republican leaders so far have been reluctant to act on a record fifth stimulus bill, believing that the urgency is not quite there yet, their position could be changing.
Part of that impetus is coming from President Trump, who is seeking a payroll tax cut as part of a new stimulus effort. “When additional legislation is contemplated, it should include a payroll tax holiday, safe harbor provisions to protect businesses from frivolous lawsuits, permitting reform to facilitate infrastructure projects, and other policies to spur our economic comeback,” he said in his statement on the HEROES Act.
If and when the Senate does decide to act, it appears that lawmakers would revert to regular order—to the extent that can be achieved under the circumstances—in passing legislation. For instance, the Senate would pass its version and then representatives from the two chambers would work out the differences in a conference committee.
Presumably the severity of ongoing health and economic conditions caused by the COVID-19 pandemic will drive the urgency and timeline for enacting additional legislation—balanced by concerns about adding even more to the national debt. It is not likely that the Senate would act until early June at the soonest.
A 70-page section-by-section summary of the HEROES Act is here.
