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Stimulus checks included in new COVID relief proposal. But they’d be half the size

U.S. Secretary of the Treasury Steven T. Mnuchin. (Kevin C. Downs/New York Daily News/TNS)

The White House on Tuesday offered a COVID-19 relief proposal that would include another round of stimulus checks — jumping back into lawmakers’ negotiations on an aid package.

Treasury Secretary Steve Mnuchin presented the $916 billion proposal to House Speaker Nancy Pelosi, a Democrat from California, he wrote in a statement Tuesday evening. It includes funding for state and local governments and liability protections for businesses — two aspects of pandemic relief that Democrats and Republicans have been at odds over.

The plan also includes a round of $600 direct stimulus payments to Americans plus an extra $600 per child, according to House Republican leader Kevin McCarthy, who reviewed the proposal, Bloomberg News reported. Senate Majority Leader Mitch McConnell, a Kentucky Republican, was also briefed on the proposal, Mnuchin said.

The checks would be half the size of the $1,200 payments sent to most Americans under the CARES Act earlier this year.

Mnuchin said the White House proposal helps pay for the checks by using $140 million in unused funds from the Paycheck Protection Program — a loan that incentives small businesses to keep workers on their payroll — and $429 billion in Treasury funds.

Bipartisan proposal

The offer is larger than the $908 billion package presented by a bipartisan group of lawmakers, which includes funding for state and local aid, pandemic unemployment benefits, small business loans and protection from coronavirus-related lawsuits. That plan does not include stimulus checks.

The White House offer, however, would cut the weekly $300 unemployment boost included in the bipartisan proposal, The Associated Press reports.

Pelosi and Senate Minority Leader Chuck Schumer balked at the idea in a joint statement released Tuesday.

“While it is progress that Leader McConnell has signed off on a $916 billion offer that is based off of the bipartisan framework, the president’s proposal must not be allowed to obstruct the bipartisan Congressional talks that are underway,” the statement said.

They called the cut to unemployment insurance benefits “unacceptable.”

“Members of the House and Senate have been engaged in good-faith negotiations and continue to make progress,” the statement says. “The bipartisan talks are the best hope for a bipartisan solution.”

The bipartisan negotiations have hit familiar obstacles toward reaching a deal, mainly over two controversial components: the liability protections, a top priority for Republicans to shield companies from COVID-19 related lawsuits, and funding for cash-strapped state and local governments, a top priority for Democrats, according to Roll Call.

Lawmakers have also faced pressure from some to include another round of direct payments to Americans. Sen. Bernie Sanders, an Independent from Vermont, and five other senators wrote a letter Tuesday demanding that another round of $1,200 checks be added to the bipartisan package.

A rush to pass aid

Congress has been racing to pass an aid package as certain relief programs are set to expire this month — meaning roughly 12 million Americans could lose unemployment benefits as coronavirus cases surge across the country.

But the White House and congressional Democrats and Republicans have so far failed to pass another aid package since the CARES Act in March.

House Democrats in May passed the HEROES Act, a $3 trillion package that was never voted on in the Senate. Republicans in the Senate passed their own $1 trillion package, the HEALS Act, in July. Negotiations have since been on-again off-again with lawmakers and the White House unable to reach an agreement.

McConnell has said there’s “no reason” why Congress can’t pass another package by the end of the year and on Tuesday proposed Republicans setting aside the liability protections in exchange for Democrats also dropping the funding for cash-strapped state and local governments.

Democrats rejected the idea as state and local governments have faced hundreds of billions of dollars in losses amid the pandemic, The New York Times reports. The funding proposal has received more bipartisan support than the liability shield proposal, and Pelosi accused McConnell of “sabotaging good-faith bipartisan negotiations.”

Leaders of both parties agree a package needs to pass before Congress adjourns at the end of the year, the Times reports. Lawmakers also face the possibility of a government shutdown next week without passing a government funding bill.

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