Allocation of COVID-19 Federal Relief Funds

Blog Post
Thursday, June 25, 2020

Lawmakers in Washington have enacted four laws in response to the coronavirus pandemic totaling $2.4 trillion. The Congressional Budget Office recently published a summary of those measures, including the estimated effects on discretionary and mandatory spending, revenues, and the deficit. The chart below is a visual representation of that data, aggregated into four aid categories: (1) households and individuals, (2) businesses and institutions (including state and local governments), (3) medical care and research, and (4) federal agencies – and provides a graphical representation of how COVID-19 relief has been allocated.

  • Businesses, Institutions, State and Local Governments (59 percent or $1.4 trillion). Nearly $1 trillion in COVID-19 relief aid has been directed towards the business community alone. Spending on programs like the Paycheck Protection Program, economic injury disaster loans, and direct aid for the airline industry were combined with a number of tax provisions to improve liquidity and encourage employee retention. This reflects both the priority and strategy of Congress to maintain the bond between employer and employee in the hopes that when it was safe to do so, everyone could go back to the jobs they had before the pandemic hit.  In addition, Congress provided approximately $280 billion to state and local governments through discretionary appropriations for transit systems, education agencies, economic development assistance programs, including $150 billion in direct aid from the Treasury and Federal Reserve.  

  • Individuals and households (27 percent, or nearly $640 billion). Legislation providing aid to individuals and households was funneled through two primary channels: expanded unemployment insurance and one-time direct cash payments (“recovery rebates”). For example, the CARES Act provided temporary unemployment insurance for workers not previously eligible (e.g., independent contractors and the self-employed) and established a $600 per week supplementary pandemic unemployment insurance benefit that expires July 31. 

  • Medical care and research (14 percent, $335 billion). All four coronavirus relief packages have included discretionary appropriations for medical care and research (e.g., vaccine development, expanded lab capacity, aid for front-line healthcare providers). Legislation also expanded Medicare telehealth benefits and expanded access to, and federal financial support for, Medicaid and the State Children’s Health Insurance Program.

  • Federal agencies (less than 1 percent, $8 billion). Certain federal agencies responsible for distributing the coronavirus funds allocated by Congress also received emergency supplemental appropriations to assist in that effort. For example, in the first coronavirus supplemental appropriation bill, the Small Business Administration received $20 million to help administer economic disaster loans.