Democrats’ Legislative Agenda Could Begin With $2K Payments, Relief, & Infrastructure Totaling $3 Trillion
We expect the legislative agenda for the Democrats to move quickly and include substantial relief that could contain meaningful, direct, and unencumbered aid for state and local governments.
There is a preliminary report noting that President-elect Joe Biden is considering a proposal that would follow through on the delivery of a $2,000 payment to select individuals and include a $3 trillion relief and infrastructure package. This is not a surprise.
What is coming as a surprise is that Democrats are already facing inter-party disagreements about the legislative agenda. Senator Joe Manchin (D from West Virginia) has already voiced opposition to the idea of $2,000 stimulus checks. The Democrats' “Blue Wave” is perhaps not as durable as initially expected.
Additionally, we expect any of the items formerly included in the HEROES Act or Moving Forward Act could be included in the $3 trillion package. This package could include municipal bond-friendly elements like the return of tax-exempt advance refundings and a sequester-proof BAB-like infrastructure bond program.
We will update our $375 billion 2021 issuance forecast. We now expect to see 2021 primary market municipal bond issuance that is between $500 and $600 billion. There is a small chance we could see just over $600 billion. We expect to publish our updated forecast by the end of the month.