The Coronavirus Aid, Relief, and Economic Security (CARES) Act, a major piece of federal legislation designed to mitigate the economic impact of COVID-19, is a critical first step to providing expanded unemployment assistance, direct cash assistance to impacted households, and aid to state and local governments. But the legislation excludes too many Washingtonians and more action is needed to bolster our communities and our economy. The magnitude of the public health, economic, and fiscal crisis that we are facing will require sustained, impactful, and inclusive action.
Here are three things to know about the new law:
1. Expansions to unemployment insurance will help Washingtonians who have been laid off
On the heels of news that 133,000 people in Washington state filed for unemployment last week (a more than 800% increase), the expansions to unemployment insurance included in the CARES Act are welcome and needed. The CARES Act provides a $600-per-week boost in unemployment insurance benefits for a four-month period and broadens who is eligible for this critical support program. Especially important is the expansion to self-employed workers.
However, a big weakness in the unemployment insurance expansions is the exclusion of undocumented workers who have lost work as a result of this crisis. Our well-being is all connected, and lawmakers must not leave undocumented people out of their relief efforts.
2. Cash payments are needed, but inadequate – especially for immigrant families.
The legislation provides a one-time cash payment of $1,200 to many individuals earning less than $75,000, with an additional $500 per child. There is a significant need for direct cash assistance to impacted individuals and households given the devastating economic impact to people in every corner of Washington state.
Yet this assistance leaves out many of the people most impacted by COVID-19. The legislation unjustly excludes people who file taxes with an Individual Tax Identification Number (ITIN) – so many of whom are on the front lines of providing services to our communities during this crisis. ITIN filers include undocumented immigrants, some student visa holders, spouses and children of people with visas tied to employment, and some survivors of domestic violence. They absolutely need access to the same direct cash assistance that others will receive. Moreover, by using federal tax returns as the basis for eligibility, the legislation leaves out thousands of people with low incomes who are not required to file tax returns.
In addition, larger, more sustained cash payments will be needed to bolster the hundreds of thousands of households directly impacted by this crisis in Washington state. These one-time payments will prove inadequate for addressing the scale of the economic crisis facing Washingtonians.
3. Aid to state and local governments will be dwarfed by state budget shortfalls.
The legislation includes much-needed aid to state and local governments across the country. Washington state stands to gain nearly $3 billion to pay for expenses associated with the virus and the looming recession through the Coronavirus Relief Fund. There is some additional assistance for tribal governments, as well as dedicated funding for education and other purposes. Our state is also set to receive an additional $600 million in additional funding for health care services for the remainder of 2020 via another COVID-19 response bill signed into law by President Trump earlier in March.
This may seem like a lot of money, but it pales in comparison to the decline in tax resources Washington is likely to experience in the coming months and years. As a matter of perspective, between 2009 and 2011 alone, Washington state lawmakers grappled with budget shortfalls totaling nearly $12 billion as a result of the previous Great Recession. The current recession will likely be as bad as the last one, if not significantly worse, meaning much more federal aid for states will be needed to help our communities weather the storm.
The magnitude of the public health, economic, and fiscal crisis that we are facing will require sustained, impactful, and inclusive action.
Additional action will be needed to support our communities and bolster our economy
Without a doubt, there is a need for additional federal support beyond this legislation. In particular, Congress will need to:
- Extend cash and unemployment assistance to immigrant workers, their families, and other ITIN filers. All low-income people, regardless of status or tax filing number, need the same protections during this unprecedented crisis.
- Expand aid to state and local governments to ensure that local officials have the resources they need to respond to the crisis and sustain critical public services like schools and health care.
- Increase direct cash assistance to impacted households. The one thing that can help families in Washington state regain economic security is immediate, significant, and direct cash assistance.
- Further bolster food assistance programs, which ensure families can continue to put food on the table and help boost consumer spending, which is vital during economic downturns.
If Congress fails to act, it will be up to our state elected leadership to fill in the gaps.
Things are changing rapidly. Below are some great resources to bookmark or follow on social media for the most up–to-date information and analyses.
Federal and tribal information:
- Center on Budget and Policy Priorities (CBPP): Source for analysis on federal budget proposals, with a particular focus on poverty and inequality
- National Employment Law Project (NELP): Source for research and legal advocacy on protections for low-wage workers and unemployed workers
- Economic Policy Institute (EPI): Source for economic policy analysis and state and national policies that support low- and middle-income workers
- Institute on Taxation and Economic Policy (ITEP): Source for data-driven analysis of tax and economic policy proposals
- National Congress of American Indians (NCAI): Source of information on impacts on tribal governments and native communities