Coronavirus: The Hill and the Headlines – COVID-19 D.C. Update – August 2020 #10

Hogan Lovells

Hogan Lovells

In Washington

  • The media continues to highlight the woes of the U.S. Postal Service (USPS) and the Trump administration moves to reorganize the independent agency during pandemic and upcoming elections. President Trump's comments admitting to wanting to defund the agency and block mail-in voting continue to be scrutinized. Internal USPS documents outline a proposal to remove 20 percent of letter sorting machines around the country before settling on close to 15 percent. Documents also reveal that the plans for the "equipment reduction" were already being implemented before Louis Dejoy, a top Trump donor and Republican fundraiser, became postmaster general, therefore disputing that this was Dejoy’s reorganization efforts of "[moving] equipment around its network" to optimize processing. House Minority Leader Kevin McCarthy (R-CA) broke with President Trump and said in an interview on CNBC that Republicans do not support withholding funding from the USPS and urged voters to cast ballots by mail. DeJoy acknowledged in an internal memo to staff that his sweeping operational changes have brought "unintended consequences" to USPS but overall defended his reorganization despite widespread criticism from lawmakers and mail worker unions. During Friday’s White House Coronavirus briefing, President Trump said that he would be open to approving billions of dollars in funding for the USPS, but only if Democrats conceded on the White House asks for a fourth stimulus bill. Trump told reporters, "Sure, if they gave us what we want. And it’s not what I want, it’s what the American people want."
  • Former President Barack Obama said Friday that President Trump was trying to "actively kneecap" USPS in an effort to discourage voting.
  • Ranking Member of the Senate Homeland Security and Governmental Affairs Committee Gary Peters (D-MI) and Sen. Tom Carper (D-DE) introduced a Senate Companion to "Delivering for America Act." House Oversight Committee Chairwoman Carolyn Maloney had introduced the House version that would preserve and keep the relative operations and level of services maintained at the beginning of the year during the COVID-19 emergency. It would not allow for any changes that would have the effect of delaying or non-delivery of mail. Peters has also launched an investigation into the changes DeJoy ordered that are preventing Americans from receiving critical mail on-time, including prescription drugs, business mail, and mail-in ballots.
  • Maine Republican Senator Susan Collins (R-ME) sent a letter to DeJoy asking him to promptly address the delays in mail delivery that have occurred following recent operational changes at the USPS. She notes that postal service employees and constituents are alarmed by the delays and the critical access to mail which include prescription medications. She further encouraged DeJoy to publicly disclose the details of the agency’s policies to help operations run on schedule and reduce overtime. She said she fears these moves will have the "opposite effect" of reducing services and driving away customers leading to further declines in volume and the crisis facing USPS.
  • Democratic and Republican lawmakers are pushing to revive the US$70 billion Economic Injury Disaster Loan (EDIL) program for small businesses. Unlike the widely hailed Paycheck Protection Program (PPP), the EDIL relies on loans and grants directly from the government, not private banks. Lawmakers are dealing with complaints from employers and the Small Business Administration itself that the program offered less financial assistance than promised and had lengthy wait times. Sens. Ben Cardin (D-MD) and Marco Rubio (R-FL) continue to craft provisions for a possible next coronavirus relief bill.
  • A coalition of 64 mayors and Environment America sent letters to members of Congress urging clean energy tax credits in the next coronavirus stimulus legislation and a way to boost national recovery from impacts of the pandemic. The group says clean energy credits "work" and are one of the best tools to support and spur growth in renewable energy, energy storage, electric vehicles, offshore wind power, and energy efficiency.
  • Canadian and U.S. officials say they have extended the land border restrictions between the two countries until 21 September. Canada’s Public Safety Minister Bill Blair tweeted, "We are extending the reciprocal restrictions at the Canada-US border for another 30 days, till Sept. 21, 2020. We will continue to do what’s necessary to keep our communities safe." Acting Homeland Security Secretary Chad Wolf confirmed the extension on Twitter as well.
  • The Government Accountability Office (GAO) released a report Friday that found the two top Department of Homeland Security (DHS) officials, Secretary Chad Wolf and acting Deputy Secretary Ken Cuccinelli, are technically ineligible to serve based on an improper appointment. The issue stems from the 2019 resignation of Kirstjen Nielsen as DHS Secretary who was replaced by Kevin McAleenan. The report found that McAleenan at the time was not designated in order of succession to replace the DHS Secretary.
  • The National Institute of Allergy and Infectious Diseases (NIAID) is manufacturing a strain of the coronavirus to prepare a "challenge" trial of a COVID-19 vaccine, Reuters reported on Friday. A "challenge trial" is a controversial idea to deliberately infect a few hundred young, healthy volunteers with the virus in a controlled environment to test a vaccine. Multiple clinical studies of different vaccines are already underway, and a challenge trial is not likely to replace them, NIAID told Reuters. The idea is reportedly gaining some ground among certain advocacy groups and lawmakers.
  • A person who has recovered from COVID-19 will likely be safe from re-infection for three months, according to updated guidance from the Centers for Disease Control and Prevention (CDC). The information marks the first acknowledgement of a defined immunity period for people who have recovered from a coronavirus infection. A CDC spokesman clarified that while reinfection or infecting others is unlikely during the three-month period, "it's important these individuals continue to social distance, wear masks, and practice good hand hygiene until scientists know more about long term immunity against COVID."
  • Swing state voters are split on who's to blame for Congress's failure to pass a second large coronavirus relief bill. CNBC/Change Research polled 2,700 likely voters in the swing states of Arizona, Florida, Michigan, North Carolina, Pennsylvania, and Wisconsin. The survey found that 40 percent of respondents blame Democrats for the stalled talks, 39 percent hold President Trump and congressional Republicans most responsible, and 18 percent blamed both parties equally. Among independents, 40 percent blame Democrats, 31 percent fault the GOP, and 25 percent blame both sides. The pollsters surveyed respondents this past Friday through Sunday.

In the News

  • Retail sales rose 1.2 percent for the month of July, which was less than the expected due to lagging auto sales. However, excluding auto sales, the gain was 1.9 percent.
  • The National Collegiate Athletic Association (NCAA) has officially cancelled all fall championships due to the COVID-19 pandemic. To help supplement college athletes’ finances, a group of Senators announced a plan to introduce a "College Athletes Bill of Rights." Sen. Cory Booker (D-NJ) who is leading the proposal, said in a statement Thursday that the NCAA has failed to keep college players safe and the "time has come for change."
  • The UK government has reached a deal with Novavax to supply 60 million doses of its potential coronavirus vaccine. The financial terms of the agreement have not been released. The potential vaccine, named NVX-CoV2373, will start phase three clinical trials this quarter.
  • California became the first state in the U.S. to top 600,000 total COVID-19 cases since the outbreak started, according to Johns Hopkins University. The state reported 6,608 new cases of the coronavirus on Thursday.
  • Despite a positive-result rate of about one-fifth, the number of Texans getting coronavirus tests has plummeted in the past two weeks, which could understate the virus’s spread in the Lone Star state. On Thursday, Gov. Greg Abbott (R) instructed his administration to figure out which numbers can be trusted and why positive tests have doubled this month.
  • Clothing subscription company "Rent the Runway" is closing its stores for good, due to lagging sales from COVID-19. The company plans to continue to grow its network of drop box locations. So far, the company has partnered with WeWork, Nordstrom, and West Elm.

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DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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