New federal bill to mitigate COVID-19’s economic impact: Three things for Washingtonians to know

Related Posts

To support kids, support their caregivers

Washington needs targeted investment in Temporary Assistance for Needy Families

Federal leaders must keep money flowing to support equitable economic recovery

Now is the time to invest in the health of Washington’s people and communities

Washington state’s essential workers deserve relief & real protections

New federal bill to mitigate COVID-19’s economic impact: Three things for Washingtonians to know

It’s a step forward, but plan is inadequate and excludes important members of our communities

By - March 27, 2020

US capitol building, Washington DCThe Coronavirus Aid, Relief, and Economic Security (CARES) Act, a major piece of federal legislation designed to mitigate the economic impact of COVID-19is 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 neededThe 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 programEspecially 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:

  1. 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.
  2. 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.
  3. 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.
  4. 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.

Federal and tribal information:

Washington state information:

About Misha Werschkul, Executive Director

As the leader of the Budget & Policy Center, Misha guides the organization’s strategic vision and ensures its position as a leading voice shaping the debate around budget priorities.

Read more about Misha