January 14, 2021   Congressional Budget Office Estimate for Division N—Additional Coronavirus Response and Relief H.R. 133, Consolidated Appropriations Act, 2021 Public Law 116-260 Enacted on December 27, 2020   The Congressional Budget Office and the staff of the Joint Committee on Taxation (JCT) have completed an estimate of the direct spending and revenue effects of division N of H.R. 133, the Consolidated Appropriations Act, 2021 (enacted on December 27, 2020, as Public Law 116-260). Division N of the act provides funding, expands eligibility for existing programs, and establishes new programs to provide assistance to individuals and businesses in response to the coronavirus pandemic. Division N will increase deficits by an estimated $682 billion over the 2021-2030 period, CBO and JCT estimate. In addition, division M, the Coronavirus Response and Relief Supplemental Appropriations Act, 2021, provides supplemental discretionary appropriations for federal activities in response to the pandemic. On December 22, 2020, CBO estimated that outlays stemming from those appropriations would increase deficits by $185 billion over the 2021-2030 period.1 CBO estimates that provisions in division N, together with those in division M, will increase the deficit by $868 billion. The major provisions of division N are described below. Title I includes two provisions that change Medicare’s payments to health care providers. One increases payment rates to physicians for 2021; the other eliminates Medicare’s sequestration cuts through March 2021. Sequestration refers to a set of across-the-board reductions in budgetary resources established by the Budget Control Act of 2011. Those reductions are required under current law for some mandatory programs, including Medicare. Title II extends several unemployment benefit programs established by the Coronavirus Aid, Relief, and Economic Security (CARES) Act, including Pandemic Unemployment Assistance and Pandemic Emergency Unemployment Compensation. Additionally, it reestablishes Federal Pandemic Unemployment Compensation by providing a weekly     1. See Congressional Budget Office, cost estimate for Division M of H.R. 133, the Consolidated Appropriations Act, 2021 (December 22, 2020), www.cbo.gov/publication/56916. Congressional Budget Office Estimate for Division N, Consolidated Appropriations Act, 2021 Enacted on December 27, 2020 January 14, 2021 supplement of $300, for up to 11 weeks, to people in all unemployment benefit programs. That supplement applies to weeks of unemployment starting after December 26, 2020. Title II also provides additional recovery rebates of $600 per qualifying adult or dependent, makes certain modifications to the recovery rebates provided by the CARES Act, and temporarily extends tax credits for sick and family leave provided by the Families First Coronavirus Response Act. Title III provides funding to guarantee initial and supplemental Paycheck Protection Program (PPP) loans; extends the period in which the Small Business Administration may guarantee PPP loans and provides grants under the Economic Injury Disaster Loan program, which target low-income communities; provides grants to operators of live-performance venues; and provides funding to pay principal and interest on Small Business Administration loan products. The budgetary effects stem primarily from guaranteeing additional PPP loans. Title III also rescinds $146.5 billion in unobligated balances provided in the CARES Act for the PPP and Debt Relief program. CBO anticipates that those amounts would not have been spent under prior law; thus, the rescission reduces budget authority but will not affect outlays. Title IV establishes procedures similar to those under title IV of the CARES Act to provide funding to passenger air carriers and related contractors; the budgetary costs stem primarily from that assistance. Those costs will be partially offset by proceeds from warrants and 10-year notes that CBO expects certain air carriers will issue as a condition of receiving assistance. In addition, title IV provides funding to certain transportation businesses, such as those that operate passenger vessels or motor coaches. Title V appropriates $25 billion for rental assistance for very-low-income households and those with members who are unemployed. That title also appropriates $12 billion to support community development financial institutions (CDFIs) and minority depository institutions—$9 billion for purchases of financial instruments from those institutions and $3 billion for grants to CDFIs. Title VII provides $12.7 billion in support payments to producers of commodity crops, specialty crops, dairy, livestock, poultry, renewable fuels, and timber. It also provides funds to purchase agricultural products for distribution and supplemental funding for existing farm support programs. Title VII also increases benefits under the Supplemental Nutrition Assistance Program, expands program eligibility, and provides funds to states for program administration. It also provides funds to the Commonwealth of the Northern Mariana Islands, Puerto Rico, and American Samoa for nutrition assistance programs. Title VII replaces a portion of reimbursements from the Child Nutrition Program that 3 Congressional Budget Office Estimate for Division N, Consolidated Appropriations Act, 2021 Enacted on December 27, 2020 January 14, 2021 some schools lost between March 2020 and June 2020 because of the pandemic. It also simplifies determination of eligibility under the Pandemic Electronic Benefit Transfer program for children in qualifying daycare facilities. Title IX provides funding for programs to expand access to broadband Internet and telehealth services and a Federal Communications Commission program to reimburse communications providers for the cost of removing and replacing equipment or services made or provided by entities that are deemed to pose a national security risk. Title X rescinds certain amounts appropriated by the CARES Act for the subsidy cost of certain loans, loan guarantees, and grants for various businesses and state and local governments, including assistance provided through the Federal Reserve. The estimated rescission of $479 billion is net of amounts that otherwise would have been recorded as reductions in budget authority under the Federal Credit Reform Act. CBO expects that those funds would not have been spent under prior law; thus, reducing the budget authority will not affect outlays. Although P.L. 116-260 is appropriation legislation, section 1401 of division O specifies requirements for the budgetary treatment of divisions N through FF. (Those requirements do not apply to title VIII of division O or to title XIII of division FF. The budgetary effects of those provisions are included in CBO’s estimate of discretionary spending under division M of the legislation.) In keeping with section 1401 of division O, and at the direction of the House and Senate Committees on the Budget, divisions N through FF are considered authorizing legislation rather than appropriation legislation. As a result, the estimated budgetary effects of those divisions are subject to pay-as-you-go procedures. However, section 1401 of division O also requires the estimated budgetary effects stemming from those divisions to be excluded from the pay-as- you-go scorecards maintained by the Senate and the Office of Management and Budget. Furthermore, subsection 1401(d) of division O reset the balances of those scorecards to zero upon the adjournment of the second session of the 116th Congress.             3 CBO’s Estimate for Division N, Coronavirus Response and Relief, of the Consolidated Appropriations Act, 2021, Public Law 116-260   Estimated Direct Spending and Revenue Effects for Division N         January 14, 2021By Fiscal Year, Millions of Dollars                       2021-2021- 202120222023202420252026202720282029203020252030  INCREASES OR DECREASES (-) IN DIRECT SPENDINGa    Title I - HEALTHCAREb            Estimated Budget Authority5,7701,052000000006,8226,822Estimated Outlays4,8701,052000000005,9225,922Title II - ASSISTANCE TO INDIVIDUALS, FAMILIES, AND BUSINESSES          Subtitle A - Unemployment Assistancec            Estimated Budget Authority116,96130868297725077888119,178119,216Estimated Outlays116,98131468397524913566119,202119,223Subtitle B - Direct Payments to Individuals            Estimated Budget Authority163,38814000000000163,527163,527Estimated Outlays163,25127700000000163,527163,527Title II Total            Estimated Budget Authority280,34944868297725077888282,705282,743Estimated Outlays280,23259168397524913566282,729282,750Title III - CONTINUING THE PAYCHECK PROTECTION PROGRAM AND OTHER SMALL BUSINESS SUPPORTd     Estimated Budget Authority178,500000000000178,500178,500Estimated Outlays296,5285,308131000000301,850301,850Title IV - TRANSPORTATIONe            Estimated Budget Authority17,980-40-40-30-30-280-130-140-140-14017,84017,010Estimated Outlays17,590360-40-30-30-280-130-140-140-14017,85017,020Title V - BANKING            Estimated Budget Authority37,00700000000037,00737,007Estimated Outlays28,7576,800898288123-15-6*1136,86636,847Title VII - NUTRITION AND AGRICULTURE RELIEF            Estimated Budget Authority24,917235938262556465507425,38925,697Estimated Outlays24,5265531399866576465507425,38225,693Title IX - BROADBAND INTERNET ACCESS SERVICE            Estimated Budget Authority7,0000000000007,0007,000Estimated Outlays4531,4022,2101,5207233391773123146,3086,892Title X - MISCELLANEOUSf            Estimated Budget Authority-479,000000000000-479,000-479,000Estimated Outlays000000000000Total Change in Direct Spending            Estimated Budget Authority72,5231,6957351,029282-218-59-67-82-5876,26375,779Estimated Outlays652,95616,0663,9032,8521,131102108-39-60-45676,907676,974   INCREASES OR DECREASES (-) IN REVENUES    Title II - ASSISTANCE TO INDIVIDUALS, FAMILIES, AND BUSINESSES          Revenues-5,9131921081108349343-4-4-5,418-5,342  NET INCREASES OR DECREASES (-) IN THE DEFICIT    Estimated Effect on the Deficitg658,86915,8743,7952,7421,0485374-42-56-41682,325682,316   Sources: Congressional Budget Office; staff of the Joint Committee on Taxation. CBO’s estimates are relative to CBO’s March 2020 baseline, except where noted. The staff of the Joint Committee on Taxation provided estimates for the tax provisions. See Joint Committee on Taxation, Estimated Revenue Effects of the Revenue Provisions Contained in Rules Committee Print 116-68, the “Consolidated Appropriations Act, 2021 ” (December 2020), JCX-24-20, www.jct.gov/publications/2020/jcx-24-20. Components may not sum to totals because of rounding. CARES Act = Coronavirus Aid, Relief, and Economic Security Act; * = between -$500,000 and $500,000. Footnotes appear on the following page.                 1 of 2  CBO’s Estimate for Division N, Coronavirus Response and Relief, of the Consolidated Appropriations Act, 2021, Public Law 116-260 Estimated Direct Spending and Revenue Effects for Division N continuedJanuary 14, 2021  a. Public Law 116-260 is appropriation legislation, but section 1401 of division O specifies requirements for the budgetary treatment of divisions N through FF. (Those requirements do not apply to title VIII of division O or to title XIII of division FF. The budgetary effects of those provisions are included in CBO’s estimate of discretionary spending under division M of the legislation. See Congressional Budget Office, cost estimate for Division M of H.R. 133, the Consolidated Appropriations Act, 2021, December 22, 2020, www.cbo.gov/publication/56916.) In keeping with section 1401 of division O, and at the direction of the House and Senate Committees on the Budget, divisions N through FF are considered authorizing legislation rather than appropriation legislation. As a result, the estimated budgetary effects of those divisions are subject to pay-as-you-go procedures. However, section 1401of division O also requires the estimated budgetary effects stemming from those divisions to be excluded from the pay-as-you-go scorecards maintained by the Senate and the Office of Management and Budget. Furthermore, subsection 1401(d) of division O reset the balances of those scorecards to zero upon the adjournment of the second session of the 116th Congress. b. CBO estimates that eliminating the sequestration cuts to Medicare through March 2021 will result in an increase in outlays that is smaller than the corresponding increase in budget authority because of behavioral responses. c. The costs of provisions related to unemployment insurance have been estimated using a projection of the unemployment rate published in May 2020 and using data on actual benefit payments and numbers of claimants through October 31, 2020. d. Title III reduces budget authority provided in the CARES Act for the Paycheck Protection Program and the Small Business Administration’s Debt Relief program by a combined $146.5 billion. CBO expects that those amounts would not have been spent under prior law; thus, reducing the budget authority will not affect outlays. Title III provides$325 billion in new budget authority for those and other small business programs; CBO expects that most of the new budget authority will be spent over the 2021-2030 period. Consequently, the total outlay changes resulting from this title are larger than the net change in budget authority. e. Section 402 of title IV authorizes the Department of the Treasury to use available balances provided under the CARES Act to administer certain provisions in this title; thus, this provision affects outlays only. f. CBO estimates that title X rescinds $479 billion appropriated by the CARES Act for the subsidy costs of certain loans, loan guarantees, and grants for various businesses and for state and local governments, including assistance provided through the Federal Reserve. That rescission is net of amounts that otherwise would have been recorded as reductions in budget authority under the Federal Credit Reform Act. CBO estimates that those funds would not have been spent under prior law; thus, reducing the budget authority will not affect outlays. g. On December 21, 2020, CBO published a cost estimate for division M of Public Law 116-260, the Consolidated Appropriations Act, 2021 (www.cbo.gov/publication/56916), which provides supplemental appropriations for federal agencies to respond to the coronavirus pandemic and provides assistance to nonfederal entities. Taken together, division M and division N of Public Law 116-260 are projected to increase the deficit by roughly $868 billion over the 2021-2030 period.                                              2 of 2

CBO Estimates Effects of Coronavirus Relief Tax Provisions

CBO Estimates Effects of Coronavirus Relief Tax Provisions

U.S. Congressional Budget Office

Division N of the Consolidated Appropriations Act, 2021 (P.L. 116-260), will raise spending by $677 billion from 2021 to 2030 and cut revenues by $5.3 billion, for a deficit of $682.3 billion, with most of the cost coming from direct payments to individuals and the Paycheck Protection Program, the Congressional Budget Office estimated January 14.

Division N of the Consolidated Appropriations Act, 2021 (P.L. 116-260), will raise spending by $677 billion from 2021 to 2030 and cut revenues by $5.3 billion, for a deficit of $682.3 billion, with most of the cost coming from direct payments to individuals and the Paycheck Protection Program, the Congressional Budget Office estimated January 14.

Division N of the Consolidated Appropriations Act, 2021 (<a href="/lr/resolve//2dc5z">P.L. 116-260</a>), will raise spending by $677 billion from 2021 to 2030 and cut revenues by $5.3 billion, for a deficit of $682.3 billion, with most of the cost coming from direct payments to individuals and the Paycheck Protection Program, the Congressional Budget Office estimated January 14.