HEROES Act to Provide COVID-19 Relief, Reinstate SALT Reduction to New Jersey

New Jersey would receive much-needed federal aid in the proposed Health and Economic Recovery Omnibus Emergency Solutions (HEROES) Act put forth in the House of Representatives May 12. 

The new bill is a combination of coronavirus rescue, relief, and tax cut package North Jersey lawmakers have prioritized in recent weeks due to the state being one of the hardest-hit areas in the U.S.

“I’ve been fighting to get real tax cuts and economic assistance to help rescue Jersey families and businesses from this health and economic crisis, and making sure our state and local governments, hospitals, and frontline workers get the resources they need to continue keeping us safe at the epicenter of this storm,” said Rep. Josh Gottheimer. “Our families, state and local governments, and hospitals and frontline workers need relief and assistance, and that’s exactly what I’m fighting for.”

Immediate Relief

Rep. Bill Pascrell noted the bill would provide more immediate relief to every state and local government across the U.S. 

“America stands at the cliff’s edge of one of the great crisis points in our nation’s history,” said Pascrell. “The decisions we make today to meet this challenge will determine the health and welfare of generations that will follow us.”

A key provision in the bill both state and federal lawmakers have fought for is the two-year elimination of the state and local tax (SALT) deduction. 

SALT Reinstated

“The inclusion of SALT relief…is a recognition that SALT relief is needed economic relief in response to the COVID crisis,” stated Pascrell. “In fact, SALT relief is critical assistance for our state and local governments, which are already facing brutal service cuts and need help now.”

“This is an anti-Moocher bill—it will get the hardest-hit families, like ours, immediate rescue and relief dollars and will fully reinstate SALT, giving Jersey a long-needed tax cut to invest back in our communities,” said Gottheimer. “Not only are our communities getting hit with COVID-19, but for years now New Jersey has been getting whacked with higher taxes—which is why I’ve been fighting to fully reinstate SALT and finally cut taxes for North Jersey.”

State Relief

The bill has the support of Gov. Phil Murphy. 

“For months now, we have been calling on the federal government to provide much-needed relief to state governments,” said Murphy in a released statement. “The HEROES Act, unveiled by Speaker Pelosi and House leadership, is critical to ensuring that our police officers, educators, firefighters, EMTs, first responders, and other essential government workers are able to remain on the job and continue saving lives.”

Other legislation measures in the HEROES Act include:

  • The bill provides another $1,200 refundable tax credit for each family member to be paid out in advance payments, similar to The CARES Act. The credit is $1,200 for single filers ($2,400 for joint filers), in addition to $1,200 per dependent up to a maximum of three dependents. The credit starts phasing out at $75,000 of modified adjusted gross income, $112,500 for head of households and $150,000 for joint filers.
  • The newly created State and Local Coronavirus Relief Fund would provide $500 billion to states and $375 billion to local governments that can be used for COVID-related expenses. The funds would be distributed based on the state’s share of COVID cases and population. Over the next two years, New Jersey would receive $16.7 billion and municipal governments $11.3 billion. Additionally, legislation extends the emergency unemployment benefits.
  • The legislation will provide a Public Safety Officer Benefits death and disability presumption for officers who contract COVID-19 and an above-the-line deduction to first responders for expenses related for tuition or fees related to professional development courses or uniforms.
  • The proposed bill provides $500 million for Staffing for Adequate Fire Emergency Response grants for hiring and retaining firefighters, $500 million for Assistance to Firefighter Grants for personal protective equipment, mental health evaluations, training, and infectious disease decontamination, $300 million for Community Oriented Policing Services grants for hiring and re-hiring of police officers and $300 million for Byrne Justice Assistance Grants to help prevent, prepare for, and respond to coronavirus, including for purchasing personal protective equipment and controlling outbreaks of coronavirus in prisons.  
  • The Centers for Medicare and Medicaid Services would have to re-establish a rural floor for the Medicare hospital area wage index for all-urban hospitals. The bill would also provide coverage of COVID-19 related treatment at no cost sharing. It further requires coverage of items and services related to the treatment of COVID-19 in group and individual market health plans and waives cost-sharing requirements for consumers during the COVID-19 public health emergency.
  • The bill increases to 100% the federal cost share for assistance provided under the emergency declaration issued by President Donald Trump. The current cost share is 75% for the federal government and 25% for state governments.

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