Preventing Paygo Sequestration
Floor Speech
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Ms. JACKSON LEE. Mr. Speaker, I thank our distinguished chairman for yielding.
Mr. Speaker, whenever you hear the words of Speaker Pelosi, you know that the gentlewoman is leading us on the fight to protect our seniors. I am glad to cosponsor this legislation to be a strong supporter of being on the front seat of protecting our seniors.
Whenever you hear us being demagogued from those on the other side using demagoguery, you can be assured that when they pass a tax bill, it was not having seniors as their priority. But when you hear the word ``Medicare,'' you know that Democrats are standing strong to make sure that not one dime is taken away from our seniors with Medicare.
My open letter to my seniors in my district--open message to my seniors is: We will die on the vine to protect your Medicare. That is what we are doing today on the floor of the House. Not one dime will come out of your Medicare.
Mr. Speaker, I am proud to support H.R. 1868, which excludes the budgetary effects of the American Rescue Plan of 2021 from scorecards established by the Pay-As-You-Go, or PAYGO Act of 2010, preventing across-the-board cuts to numerous direct-spending programs. That is what we are doing here today. We are taking our seniors seriously.
I say to seniors: Have no fear with all of this demagoguery because we are going to make sure that not one dime comes out of your pocket.
In addition, I say to seniors: You are going to be living in cities like Houston, where it says that Houston's share of the stimulus package is $615 million.
That is going to help keep the city services going, the fire, the police, and trash pickup going. We know that seniors call my office and these issues are important to them.
Mr. Speaker, I include in the Record a Houston Chronicle article dated March 10, 2021, showing that the city of Houston will receive $615 million. [From the Houston Chronicle, Mar. 10, 2021] Houston's Share of Stimulus Bill Expected To Top $600M, Help Avoid Cuts to City Services, Officials Say (By Jasper Scherer)
Houston and Harris County are expected to receive more than $1.5 billion through the stimulus bill approved by Congress Wednesday, providing a massive cash injection that city officials say will help close a budget shortfall widened by the pandemic for the second year in a row.
The measure provides local governments with their most generous round of COVID-related funding yet, and it comes with fewer spending restrictions than last year's aid. Houston will receive an estimated $615 million, putting the city at more than $1 billion in direct federal relief during the pandemic, while Harris County is projected to receive $914 million--more than double its allotment from the first round of local aid last March.
``I'm hopeful and optimistic that we will be able to use this money to, essentially, bail the city out of a very dire financial situation,'' said City Controller Chris Brown, who monitors the spending of Houston's more than $5 billion city budget.
Many local governments, including Houston, have seen their sales tax revenues plummet as the pandemic slowed consumer spending on dining, tourism and other leisure activity. And while rising appraisal values mean the city is projected to take in more money from property taxes this year than last, officials say the pandemic's true toll on property tax revenue may not be felt until early 2022, when homeowners make payments for this year's not-yet-certified tax rolls.
Much to the relief of local officials, the latest round of federal aid allows cities and counties to spend the funds to replace revenue lost due to the pandemic. Trump administration rules barred local governments from using the first round of local COVID relief to plug budget holes, stipulating it could only cover expenses tied directly to the pandemic, though Mayor Sylvester Turner's administration still was able to use the funds to avoid furloughing city employees.
Marvin Odum, the former Shell executive appointed by the mayor to oversee the city's COVID recovery, said Wednesday he is ``very optimistic the funds will be able to be used to mitigate the city's budget shortfalls resulting from COVID- 19.'' Still, he noted that beyond the broad language in the bill, federal officials have yet to release specific rules for how local governments can spend the funds.
``I'll just caution that clarity on the guidelines for these programs tends to come over time. It's not always available immediately,'' Odum said.
Republican lawmakers bitterly opposed the local aid, including Senate Minority Leader Mitch McConnell, who accused Democrats of sending ``wheelbarrows of cash to state and local bureaucrats to bail out mismanagement from before the pandemic.'' Meanwhile, local officials across the country have warned they would have to enact deep cuts to city services, such as fire, police and trash collection, without federal aid to offset their revenue losses.
``Every mayor, every county judge, every local official that I visited with since before December, they all need help,'' said U.S. Rep. Sylvia Garcia, D-Houston, a former Houston controller and county commissioner. ``Every city in America will get dollars to help with their revenue shortfalls. And that's huge, because they can keep the firefighters working, they can keep police departments open, they can get the garbage picked up.''
Even before the pandemic, Houston officials in recent years have scrambled to close major city budget gaps, often dipping into reserves to balance spending and revenue. The city's public safety costs, which make up more than half of spending on core services, have steadily increased as the budget remains capped by a limit on how much property tax revenue the city can take in each year.
``It's going to solve, in the short term, some of these problems, but the real challenge is, you cannot solve a structural problem with one-time financing sources,'' Brown said. ``You actually have to do the hard work to cut recurring expenses. And that's the only way you can narrow that budget gap over time.''
Local governments will receive half their federal aid within 60 days of Friday, when President Joe Biden will sign the bill into law, according to White House press secretary Jen Psaki. They will receive the second half of the funds at least a year later.
That means Houston will receive more than $300 million to offset its revenue losses next fiscal year, along with any potential shortfall before the current fiscal year ends June 30. Odum said the city finance department is projecting a budget gap of between $160 and $200 million next year, while Brown--whose office generates its own estimates separate from Turner's administration--said he expects the shortfall to be even higher.
Brown noted that while finance department projections assume the city will see a less-than-1 percent reduction in sales tax revenue this year, the actual decrease has been 7 percent.
``The (Turner) administration, I don't think, has properly evaluated the reductions in sales and property tax,'' Brown said. ``There's a $40 million variance between us and (the) finance (department) in sales tax alone.''
Brown estimated city officials will have to lay off about a dozen city employees for every $1 million trimmed from the budget, meaning Houston could have been looking at more than 2,000 layoffs without any federal aid.
Instead, Houston's relief will far exceed its budget deficit. The city also is expected to devote a chunk of the aid to direct COVID relief, such as testing and vaccinations. Turner's administration exhausted the previous round of aid, totaling $405 million, in December. Those funds covered contact tracing efforts, city workers whose jobs were consumed by COVID, and relief to renters and small businesses, among other areas.
Turner, who proposes the annual budget to city council each year, did not respond to questions Wednesday about how he intends to spend the new round of relief aid.
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Ms. JACKSON LEE. Mr. Speaker, let me also indicate that seniors' healthcare will be in a good place with this particular program. Their grandchildren will be able to go back to school with almost $1 billion to the Houston Independent School District.
Seniors' stimulus checks are not going to be ignored. They are going to be able to get stimulus checks directly into their accounts. Their grandchildren, their children will get $3,600 for a 5-year-old.
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Ms. JACKSON LEE. Mr. Speaker, I thank the gentleman for yielding.
Mr. Speaker, they will get $3,000 for children above 9 years old. There will be enhanced unemployment for the young people in their lives who have been unemployed. And then, of course, that local restaurant will be able--and I fought for this--to be open again with $28 billion.
The issue of public assistance or local government assistance was something I was allowed to offer a motion to instruct on. It was something that I thought we could not abandon. We will not abandon seniors. We will not let them touch one dime of Medicare, as our friends on the other side have.
Vote for this legislation because we are seniors first.
Mr. Speaker, as a senior member of the Committees on the Judiciary, on Homeland Security, on the Budget, and as the Member of Congress for a congressional district that has experience the worst of the COVID-19 as a public health emergency and economic catastrophe, I rise in strong support of H.R. 1868, which excludes the budgetary effects of the American Rescue Plan Act of 2021, from the scorecards established by the Statutory Pay-As-You-Go (PAYGO) Act of 2010, preventing across-the- board cuts to numerous direct spending programs.
The legislation also excludes the budgetary effects of this Act from the Senate PAYGO scorecards.
This legislation is necessary to ensure that that Medicare and other programs are protected from PAYGO sequestration.
The Statutory Pay-As-You-Go Act requires across-the-board cuts, known as ``sequestration,'' to a defined set of programs if certain legislation affecting mandatory spending or revenues increases net deficits.
Although legislation that Congress designates as an emergency or otherwise excludes from the PAYGO scorecard does not trigger sequestration, this action is necessary because restrictions on the content of reconciliation bills prevented the American Rescue Plan Act of 2021 from including a provision to avert sequestration.
The bill before also extends a separate Medicare sequester relief provision, first enacted in the CARES Act, that expires March 31,
Mr. Speaker, Congress has never permitted sequestration to affect the Medicare trust fund and it certainly will not allow it now, just when help is arriving under the American Rescue Plan Act to put shots in arms, money in pockets, kids in school, and workers back on the job.
It is worthwhile to explain why the American Rescue Plan Act is the most transformative legislation in more than a half century and easily justifies exclusion from sequestration.
H.R. 1319, the American Rescue Plan Act, is a landmark, life-saving legislation that will provide urgently-needed resources to defeat the virus, put vaccines in people's arms, money into families' pockets, children safely back into classrooms, and people back to work.
With tens of millions of Americans infected, more than half a million lives lost, over 18 million Americans unemployed and millions more hungry and food and housing insecure, thanks to the work of congressional Democrats in the House and Senate and the Biden Administration, at long last the people of the United States and my home state of Texas can be assured that `Help Is On The Way.'
In simple terms this life-saving and life-enhancing legislation puts vaccines in arms, puts money in people's pockets, puts children safely back in school, and it will put workers back in jobs.
1. Put Vaccines in Arms: The plan will mount a national vaccination program that includes setting up community vaccination sites nationwide and addressing disparities facing communities of color. It will also take complementary measures to combat the virus, including scaling up testing and tracing, addressing shortages of personal protective equipment and other critical supplies, investing in high-quality treatments, and addressing health care disparities.
2. Put Money in People's Pockets: The plan finishes the job on the President's promise to provide $2,000 in direct assistance to households across America with checks of $1,400 per person, following the $600 down payment enacted in December. The plan will also provide direct housing assistance, nutrition assistance for 40 million Americans, expand access to safe and reliable child care and affordable health care, extend unemployment insurance so that 18 million American workers can pay their bills and support 27 million children with an expanded Child Tax Credit and more than 17 million low-wage workers through an improved Earned Income Tax Credit.
3. Put Children Safely Back in School: The plan delivers $170 billion for education and $45 billion for childcare providers. This includes a $130 billion investment in K-12 school re-opening and making up for lost time in the classroom, with funds that can be used for such things as reducing class sizes, modifying spaces so that students and teachers can socially distance, improving ventilation, implementing more mitigation measures, providing personal protective equipment and providing summer school or other support for students that help make up lost learning time this year. The plan also provides more than $40 billion for higher education.
Here is what the American Rescue Plan Act means for the State of Texas, Houston, and Harris County.
An estimated $16.7 billion will come to the State of Texas.
The lion's share of $3.3 billion will come directly to the City of Houston, and Harris County will receive a similar share of $5.667 billion, thanks to a provision in the law I helped secure that created the Coronavirus Local Fiscal Recovery Fund and appropriated $45.57 billion.
$1.4 billion in direct payments is allocated to smaller jurisdiction like Jacinto City.
Houston Independent School District can expect to receive close to $100 million ($993,198 million to be more precise).
The law specifically allows this funding to be used:
1. To respond to the pandemic or its negative economic impacts, including assistance to households, small businesses, and nonprofits, or aid to impacted industries such as tourism, travel, and hospitality;
2. For premium pay to eligible workers performing essential work (as determined by each recipient government) during the pandemic, providing up to $13 per hour above regular wages;
3. For the provision of government services to the extent of the reduction in revenue due to the pandemic (relative to revenues collected in the most recent full fiscal year); and
4. To make necessary investments in water, sewer, or broadband infrastructure.
In addition to these funds, Texas will receive $100 million out of the newly created $10 billion Coronavirus Capital Projects Fund for ``critical capital projects directly enabling work, education, and health monitoring, including remote options, in response to the public health emergency with respect to the Coronavirus Disease.
Now all that is well and good but let me tell you what the American Rescue Plan Act means for a hard-working and hard-pressed single mother of two children making a modest income:
Stimulus checks: $1,400 3 = $4,200
Child tax credit: $3,600 (5-year-old) + $3,000 (9-year-old) = $6,600. Half of that amount will be paid out periodically from late July through December; the rest will come as a check with next year's taxes.
Enhanced unemployment: If the parent becomes unemployed in March, she will be eligible for $300 in aid every week through the last week of August.
Total: $10,800 from stimulus and tax credits, plus another $7,500 from 25-weeks of enhanced unemployment aid. This individual would also receive $318 per week in state unemployment aid and thousands more from the Earned Income Tax Credit. Restaurants
Finally, let me discuss briefly the good things for the restaurant industry that are in the American Rescue Plan Act.
The law allocates $28 billion in funds to devastated food service establishments, including bars, and food trucks, and vendors.
Unlike the Paycheck Protection Program, which saddled restaurants with burdensome loans if the bulk of the funds were not spent on payroll, these restaurant relief dollars are grants, plain and simple.
Grant sizes will generally be determined by subtracting lower 2020 pandemic-era receipts from higher 2019 gross receipts.
Over $5 billion will be set aside for smaller venues whose annual gross receipts were below $500,000, leaving $23.6 billion for everyone else.
Grants will be capped at $10 million for restaurant groups and $5 million for individual venues.
Publicly traded companies or restaurants with more than 20 locations will not be eligible to participate in this funding.
And, for the first 21 days, establishments owned by women, veterans, or economically and socially disadvantaged groups will be prioritized.
This transformative legislation will also provide direct housing assistance, nutrition assistance for 40 million Americans, expand access to safe and reliable child care and affordable health care, extend unemployment insurance so that 18 million American workers can pay their bills and support 27 million children with an expanded Child Tax Credit and more than 17 million low-wage childless workers through an improved Earned Income Tax Credit, which will reduce the number of children living in poverty in America by 50 percent.
I want to commend my colleagues and House Speaker Nancy Pelosi for her leadership and President Biden for signing into law the American Rescue Plan Act of 2021, and I urge all Members to join me in voting to pass H.R. 1868, which excludes the budgetary effects of the American Rescue Plan Act from the scorecards established by the Statutory Pay- As-You-Go (PAYGO) Act of 2010, and thus precludes the implementation of direct across the board cuts in spending.
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