Over the weekend President Trump signed a series of executive orders expanding certain Coronavirus economic relief provisions, following the inability of Congress (Republicans and Democrats) to reach a deal on a new stimulus bill. The executive orders cover the following four key items, which are likely to be challenged in the courts given doubts over presidential financial authority in this area:
- Provide a payroll tax holiday, doubling down on his desire to provide more relief to employed workers earning less than $104,000 and encourage employers to hire more employees or end furloughs. However this measure has been strongly opposed by both Republican and Democrats in Congress, so will likely face challenges or be a key compromise in the final stimulus bill currently being negotiated
- Extend supplementary FPUC unemployment benefits to the end of the year, but a lower amount of $400 p/week, versus the $600 under current program that expired at the end of July. (See details in this article)
- Defer student loan payments for the rest of the year by suspending loan payments and temporarily setting interest rates to zero percent (which helps those who can pay)
- Extend the federal moratorium on evictions for renters and homeowners (under certain conditions) implemented under the CARES Act. No duration or extension date was provided in the executive order memo, other than saying the FHFA will take all lawful measures to prevent residential evictions and foreclosures resulting from financial hardships caused by COVID-19.
The main challenge to the executive orders above will be the Presidents legal authority – under the constitution – to continue federal funding for the programs, because all additional funding (appropriations and taxes) for federal programs needs to go via Congress. The one exception is during times to War or a national emergency, which provides the President with broader power. However approving these specific executive orders under those provisions will be a challenge.
When do these Executive Orders Go into Effect?
So far there’s no date set on when Trump’s executive actions will go into effect and more likely than not will force Congress to get back to the negotiation table, or face months of legal challenges around implementing these executive order provisions which supersede Congressional authority.
“Today’s meager announcements by the President show President Trump still does not comprehend the seriousness or the urgency of the health and economic crises facing working families For instance, not only does the President’s announcement not actually extend the eviction moratorium, it provides no assistance to help pay the rent, which will only leave desperate families to watch their debt pile higher. Instead of passing a bill, now President Trump is cutting families’ unemployment benefits and pushing states further into budget crises, forcing them to make devastating cuts to life-or-death services.”Democrat leaders – House Speaker Nancy Pelosi and Senate Minority Leader Chuck Schumer – joint statement
The next few days and weeks will likely see several more updates on the above items as Congress now has the “ball in their court” to respond to the President’s executive orders. I’ll continue to monitor and post further updates on the above items and encourage you to subscribe via email for further updates.