WASHINGTON–Financial institutions have been critical to numerous coronavirus pandemic-related relief programs from the federal government, but now some are pushing to exclude those same institutions as the distribution channels for future payments.
Proposals on Capitol Hill for future payments now include using Internal Revenue Service records, payroll processing companies and non-profits.
Sen. Doug Jones (D-AL) is pushing a plan to give small businesses another round of help in paying employees by using the services of payroll processors, which already distribute wages for close to 40% of U.S. businesses, the New York Times said.
“Another option makes it easier and takes a little pressure off the banks,” Jones told the Times. “They’ve been overwhelmed.”
Jones has also urged fellow lawmakers to consider using payroll companies rather than banks when the first installment of the paycheck program was taking shape.
Sen. Ron Wyden of Oregon, the top Democrat on the Senate Finance Committee, has proposed businesses with under $1 million in gross receipts are reimbursed for a portion of payroll expenses directly from the IRS.
The Times further reported there is also growing support among Democrats for a plan put forward by Rep. Pramila Jayapal (D-WA) that would have the federal government directly pay 100% of weekly wages for workers making up to $100,000 and their benefits. A narrower version proposed by Sen. Josh Hawley (R-MO) would have the government provide for 80% of wages up to national median wage.
Not All Onboard
Some Democrats on the Senate Banking Committee want to see the Fed create accounts for every American, similar to how Social Security numbers are assigned. Any future aid could then be distributed through the central bank, the Times reported.
But not everyone is on board. While there have been issues with some of the recipients of funds from the CARES Act, Sen. Rob Portman (R-OH) said, “We need to look at the programs that are out there, and tweak them to get them to work better. I would hate to take it away from banks and try something else that we haven’t tried yet.”