American Rescue Plan

March 12, 2021

Earlier this week, Congress officially passed the American Rescue Plan (ARP), and it was signed into law by President Biden on Thursday afternoon.
 

To help Connecticut residents understand the details of the bill and how it can potentially provide assistance during the recovery from the COVID-19 pandemic, I have compiled some highlights of the bill relating to education and resources for children and families (such as childcare).

Education

K-12 Funding

  • $130 billion of relief will be disbursed to K-12 schools across the country to help with re-open schools for physical learning, such as recreating classroom spaces to ensure proper social distancing and hire more personnel.
  • A portion of this $130 billion will go towards the Elementary and Secondary School Emergency Relief Fund in order to provide or increase mental health services for students. As many of us have read or seen, many students have struggled with the isolation that remote learning brings, so I am pleased to see that the mental health of students is being addressed in this bill along with the students' education needs.
  • $7 billion will be set aside to provide students from low-income households and communities (as well as students with disabilities) with the Wi-Fi and devices necessary to stay connected with school from home.

Student Loans

  • ARP has a provision that makes any student loan forgiveness plan passed by Congress between now and Jan. 1, 2026 tax free. According to an example and analysis by CNBC, if a borrower had $48,000 in student loan debt cancelled by the government and pays a 24% tax rate, they would have had to have paid over $11,000 to the IRS because the IRS would treat the forgiven loan as income. This provision would ensure that any student debt forgiveness would not affect the tax liability of borrowers.

College Funding

Children and Families

Assistance for Childcare

  • Around $39 billion will be included for the Child Care and Development Block Grant, which will help get funds directly to child-care facilities.
  • $15 billion in emergency funds will be available so that essential workers may have access to child care services.
  • $1 billion will go towards the Head Start program.

I am grateful to Congress (especially to Connecticut's federal delegation) and to the Biden Administration for making education a priority in this relief package. Many of our young people have been forced to stay apart from their classmates and teachers for a year now, and the impacts of this on their education and mental health may not be known for some time. This legislation, however, makes a strong effort to mitigate those effects, close the digital divide, and make sure workers have the access to child care they need to allow them to go to work and support their families.

Under the American Rescue Plan, we have seen a large increase in PPP loan approvals! There is still plenty of time left in this program. Visit www.sba.gov to see if you qualify.