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Biden limits eligibility for stimulus payments under pressure from moderate Senate Democrats

Change comes as Senate prepares to move forward on Biden’s $1.9 trillion relief bill

The White House press secretary said on March 3 that the Biden administration supports narrower stimulus income targets than previously proposed. (Video: The Washington Post, Photo: Demetrius Freeman/The Washington Post)

President Biden has agreed to narrow eligibility for a new round of $1,400 stimulus payments in his $1.9 trillion coronavirus relief bill, a concession to moderate Senate Democrats as party leaders moved Wednesday to lock down support and finalize the sweeping legislation.

Under the new structure, the checks would phase out faster for those at higher income levels compared with the way the direct payments were structured in Biden’s initial proposal and the version of the bill passed by the House on Saturday.

The change came as the Senate prepared to take an initial procedural vote to move forward on the bill as early as Thursday. Biden and Senate Democratic leaders were scrambling to keep their caucus united since they cannot lose a single Democrat in the 50-50 Senate if Republicans unite against the legislation.

In addition to the stimulus checks, the sweeping economic package would extend unemployment benefits through August, as well as set aside $350 billion for state and local aid, $130 billion for schools, and $160 billion for vaccinations, testing and other health-care system support; increase the child tax credit; and spend billions more on other provisions including rental aid and food assistance.

Biden made a closing pitch for the package to House Democrats on Wednesday evening, citing strong public polling in favor of the measure and telling them: “I know parts of this and everything else we seek to do are not easy, but people are going to remember how we showed up in this moment, how we listened to them … and how we took action.”

At least one Senate Republican — Lisa Murkowksi of Alaska — appeared open to considering a vote in favor of the legislation, telling reporters, “My state needs relief.” Elsewhere, though, GOP opposition was hardening, as Sen. Ron Johnson (Wis.) announced plans to force Senate officials to read the entire 600-plus-page bill aloud before debate could even begin — a process he predicted would take about 10 hours.

“I don’t want to sound like a leftist, but I’m going to resist,” Johnson told a talk radio host in Wisconsin.

The action in the Senate was unfolding against a backdrop of tightened security around the Capitol complex, as the sergeant-at-arms and the Capitol Police warned of potential violent unrest over the coming days. The House moved up votes to allow members to avoid the Capitol on Thursday, the date some believers in disinformation have identified as when former president Donald Trump should rightfully be inaugurated. The Senate is scheduled to remain at work.

Under the plan for stimulus checks passed by the House, individuals earning up to $75,000 per year and couples making up to $150,000 per year would qualify for the full $1,400 payment. The size of the payments would then begin to scale down before zeroing out for individuals making $100,000 per year and couples making $200,000.

Under the changes agreed to by Biden and Senate Democratic leadership, individuals earning $75,000 per year and couples earning $150,000 would still receive the full $1,400-per-person benefit. However, the benefit would disappear for individuals earning more than $80,000 annually and couples earning more than $160,000.

That means singles making between $80,000 and $100,000 and couples earning between $160,000 and $200,000 would be newly excluded from seeing any benefit under the revised structure Biden agreed to.

The changes were confirmed by a Democratic aide who spoke on the condition of anonymity to describe internal deliberations.

White House press secretary Jen Psaki said Biden has always been open to a faster phaseout for higher-earning individuals and that “he is comfortable with where the negotiations stand.”

“He is comfortable and knows there will be tweaks on the margin,” Psaki said at Wednesday’s White House press briefing. “What his firm viewpoint is, is that it needs to meet the scope of the challenge, it needs to be the size he’s proposed, it needs to have the core components in order to have the impact on the American people.”

Economic stimulus or economic relief: Here’s what we know about who might qualify for the next round of coronavirus checks and how much they’ll get. (Video: Monica Rodman, Sarah Hashemi, Monica Akhtar/The Washington Post)

Sen. Jeanne Shaheen (D-N.H.) was among those who had called for changing the eligibility levels for checks, telling reporters this week: “I think we could drop it below the $200,000 and still get households that really need it.”

She said she would hope to redirect the savings from that change toward other needs, such as hospitals.

Narrowing eligibility for the stimulus checks was just one change moderates like Shaheen and Sen. Joe Manchin III (D-W.Va.) had been seeking. Several were also eyeing better targeting money for state and local governments, and changing the structure of weekly federal unemployment benefits in the bill, to keep them at $300 — their current level — rather than raise them to $400 as proposed by Biden and passed by the House.

Senate Democrats do not intend to adopt the suggested change to unemployment benefits, and they will stay at $400 per week, the aide said. The unemployment benefits are currently set to expire March 14; the Biden bill would extend them through August. Democrats are aiming for final passage of the bill ahead of the March 14 deadline.

Around 12 million fewer adults and 5 million fewer children would get the stimulus payments under the new Biden-Senate compromise, according to preliminary estimates from the Institute on Taxation and Economic Policy, a left-leaning think tank. About 280 million Americans in total — 200 million adults and 80 million children — would still be eligible for the checks under the new structure.

Centrist Senate Democrats had initially pushed for even more aggressive restrictions on the stimulus payments. Senior Democratic officials had at one point considered dropping the full benefit for those making more than $50,000 per year, a change they ultimately abandoned after a backlash led by Senate Finance Committee Chairman Ron Wyden (D-Ore.) and Senate Budget Committee Chairman Bernie Sanders (I-Vt.).

Still, liberal lawmakers bristled at the new changes. House liberals have suggested it could be difficult for them to approve the package if it’s watered down significantly in the Senate. Presuming the Senate passes the package later this week, it still would have to go back to the House for final approval.

“I don’t understand the political or economic wisdom in allowing Trump to give more people relief checks than a Democratic administration,” Rep. Alexandria Ocasio-Cortez (D-N.Y.) said in a statement. “People went far too long without relief last year — if anything we should be more generous, not more stingy. It’s also an insensitive compromise for the roughly 80 percent of Americans that live in urban areas, which are known for higher costs of living.”

Biden acknowledged in his comments to House Democrats that “I know we’re all making some small compromises,” but he argued that staying united to pass the relief bill, his first major piece of legislation, would help restore the public’s faith in government and open the door to further successes.

“It’s a show of strength,” Biden said. “We know how much we have to do but it all starts here, it starts by bringing this home.”

On a portion of his call with House Democrats that was not public, Biden told Rep. Suzan DelBene (D-Wash.) he supports legislation that would permanently increase the child tax credit to $3,000 per child, according to two people on call who spoke on the condition of anonymity to share details of the conversation. The legislation would currently do so for only one year.

Senate moderates were discussing further changes and GOP senators were also preparing amendments aimed at further targeting the legislation, which have potential to peel off Democratic votes as the measure moves through the Senate.

Democrats are advancing the package under a process called budget reconciliation that allows it to pass with a simple majority instead of the 60 votes normally required. With only 50 votes in the Senate and GOP support uncertain, Democrats must ensure they stay united in order to pass the legislation with Vice President Harris breaking the tie.

Attention has focused on Senate moderates who have voiced skepticism about various elements of the bill. Psaki expressed optimism Wednesday that Democratic moderates such as Manchin, and others, would ultimately support the bill.

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