What’s in the $1.9 Trillion American Rescue Plan?
3 minute read
On Thursday, March 11th President Joe Biden signed the American Rescue Plan Act into law. The $1.9 trillion piece of legislation is one of the largest in history representing about 27% of our GDP. So where is all this money going? Overall, $850 billion is directed toward individuals and families, $350 billion for state and local governements, $129 billion for K-12 aid, and $65 billion for business.
For Individuals
That vast majority of the aid targets individuals, with $410 billion being delivered directly through stimulus checks and tax rebates. What’s included:
$410 billion for $1,400 ‘stimulus checks’ for each individual and dependent
$289 billion to extended unemployment payments of $300 per week
$135 billion toward Expanded child tax credit: $3,600 per child under age 6 and $3,000 per child ages 6-17
and Expanded Child and Dependent Care Tax Credit
$25 billion for emergency rental assistance
$5.94 billion to support low-income families
For Schools
The second-largest funding is for our nation’s K-12 schools. The money is intended to reduce class sizes, provide protective supplies, improve ventilation and help schools reopen safely.
$128 billion in grants to state educational agencies with 90% allocated toward local educational agencies
$40 billion to support child care and development centers
$39 billion toward higher education institutions
For Businesses
The American Rescue plan specifically targeted two of the hardest-hit industries with financial support in this latest round of economic stimulus. About $30 billion will go to the transportation industry to support its workers and $25 billion to restaurants and bars. What’s included:
$7.25 billion of additional funding for PPP loans and allows non-profits to now apply
$28.6 billion for restaurant, food, and drinking establishments through Restaurant Revitalization Fund
$10 billion for Targeted Economic Injury Disaster Loans (EIDL) payments ($10,000 advances)
$5 billion for very small businesses (under $500,000 in revenue)
$1.25 billion for venue operators (museums, arenas, etc.)
$30 billion for transit costs, including payroll and protective gear
$10 billion for agriculture and rural farmers
$3 billion to support aerospace manufacturing
$1.5 billion for Amtrak employees who were furloughed
$15 billion to support workers in the airline industry
Government
$350 billion for state and local governments to make up for lost tax revenue
$16 billion toward Veteran Affaris
$17 billion for Foreign Affairs
Fight Against COVID
As the vaccines continue to roll out, so does the cost. The American Rescue plan provides additional money to facilitate the fight against the Coronavirus.
$46 billion toward diagnosing and tracking COVID infections
$7.5 billion to Centers for Disease Control and Prevention to track, administer, and distribute COVID vaccines
$2 billion for testing supplies and protective gear
There is a lot to unpack here, but the majority of funds will be directed toward individuals and their families. The who, what, and how of the payouts are complicated but provide a significant benefit to individuals, families, and the economy. Contact me to learn more about how this and other government programs affect your financial outlook.