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To date, policymakers have authorized an estimated $3.6 trillion in federal spending (the budgetary cost of which is only $2.4 trillion) to help counter the economic effects of the coronavirus (COVID-19) pandemic. Of that authorized spending, nearly 45 percent, or $1.6 trillion, is in the form of direct payments such as expanded unemployment benefits, forgivable business loans, and cash payments to taxpayers, healthcare providers, and governments. The remaining 55 percent is comprised of indirect payments, which includes items such as tax incentives and certain loans.
This blog breaks down the disbursement of the $1.6 trillion in direct aid, which includes $690 billion to businesses, $600 billion to individuals, and $325 billion to others such as healthcare providers and state and local governments. As of July 2, $1.23 trillion, or about 75 percent of those direct payments, have been disbursed.
Paycheck Protection Program. The Paycheck Protection Program (PPP) provides $670 billion worth of federally backed loans in an effort to incentivize small businesses to maintain their payroll during the crisis; those loans will be forgiven if used for certain expenses such as payroll, rent, or utilities. The Small Business Administration (SBA), the agency that administers the program, has disbursed $521 billion of such loans as of June 30. That amount does not necessarily include loan increases, loan decreases, or all of the $10 billion set aside for community development financial institutions. The deadline to apply for PPP funding has been extended to August 8, 2020.
Economic Injury Disaster Loan Advances. Economic Injury Disaster Loan (EIDL) Advances, also referred to as EIDL grants, provide up to $10,000 of economic relief to qualified small businesses and agricultural businesses that faced economic injury because of the pandemic; such advances do not have to be repaid. Taken together, the Coronavirus Aid, Relief, and Economic Security (CARES) Act and the Paycheck Protection Program and Healthcare Enhancement Act authorized a total of $20 billion to the program. As of July 3, the SBA has disbursed about $16 billion in EIDL Advances.
Economic Impact Payments. The Internal Revenue Service (IRS) is issuing direct payments, often referred to as stimulus checks and usually totaling $1,200 for individuals and $2,400 for married couples, to help Americans mitigate the economic impact of the COVID-19 pandemic. As of June 3, the IRS had processed 159 million payments, totaling almost $267 billion. The Joint Committee on Taxation estimates that those payments will cost a total of $292 billion through 2021.
Extension of Unemployment Benefits. The CARES Act extended unemployment benefits through three “programs”:
Air Carrier Worker Support. The Payroll Support to Air Carriers and Contractors program provides up to $32 billion in federal aid to maintain employment in the airline industry. While the money is provided to employers, it is used to cover employee wages, salaries, and benefits. The Treasury has disbursed $23 billion as of July 2, out of a total of $32 billion authorized for the program.
Provider Relief Fund. The $175 billion Provider Relief Fund, administered by the Department of Health and Human Services (HHS), distributes direct payments to hospitals and other healthcare providers on the front lines of the coronavirus response. The CARES Act authorized $100 billion to the fund — $50 billion is allocated proportional to providers’ share of revenues (known as general distribution) and another $50 billion is allocated for targeted distribution to healthcare providers in areas affected the most by the pandemic (known as targeted distribution). The Paycheck Protection Program and Healthcare Enhancement Act, the fourth coronavirus response legislation, allocated an additional $75 billion to the fund. HHS’s distribution timeline indicates that nearly $70 billion of the total funding has been disbursed thus far. However, the agency announced in June that they will be providing an additional $20 billion for general distribution, $15 billion to eligible Medicaid and CHIP providers, $10 billion to safety net hospitals, and $10 billion to hospitals in COVID-19 hotspots. The remaining funding has yet to be allocated.
Coronavirus Relief Fund. Such funding consists of $150 billion in direct federal aid to governments in states, territories, and tribal areas to cover expenditures incurred due to the COVID-19 pandemic. As of July 2, the Treasury has disbursed $149 billion of that aid.
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