Los Angeles, CA — The American Recovery and Reinvestment Act of 2009, more popularly known as President Obama’s economic stimulus package, is a $787 billion combination of economic incentives, tax cuts and relief measures that according to Congresswoman Diane E. Watson is the second leg of a three-pronged approach to resuscitating the American economy.
Watson said the package will help create 396,000 new jobs statewide and about 7,700 in her 33rd District. Other local Congressional districts will benefit as well. Those who are represented by Maxine Waters in the 35th District and Laura Richardson in the 37th District, can expexct to see 6,900 new jobs come into each jurisdiction.
While some of the so-called “shovel-ready” construction and development projects that have been approved but delayed because of funding concerns can now get moving immediately, the bulk of the economic incentives will not get to consumers until June at the earliest.
This “second leg” legislation follows an initial effort by former President George W. Bush, which primarily provided economic relief to the nation’s ailing financial system. Watson said the Obama-devised plan is designed to get spending going again in the country by diffusing money quickly to encourage people to shell out for goods and services.
The second leg, added Watson, will take up where Bush left off and continue to revitalize the lending market and banking institutions. It will pointedly require the financial sector to take any money given and use it to begin to make loans to consumers for such big ticket items as mortgages.
The third prong of the economic revitalization effort is oversight and regulation, something Watson said was missing from the first part of the stimulus program. The Congressperson has been appointed to head a new subcommittee–the Management, Procurement and Organization Subcommittee of the House Government Reform Committee–that will monitor how the government distributes and spends taxpayer money this go round.
Among the consumer-related highlights of the recovery package are the following:
* Four million college students can take advantage of a partially refundable $2,500 tax credit for families.
* Taxpayers will receive a refundable tax credit of 6.2% of earned income or up to $400 ($800 for married couple filing jointly), whichever is less. This boost will come in the form of a reduction in taxes taken from paychecks and could begin as early as March. The credit phases out at income brackets above $75,000.
* The child tax credit will be expanded to allow families to begin qualifying for the reduction with every dollar earned over $3,000.
* The Earned Income Tax Credit will increase in 2009 for taxpayers with three or more qualifying children, and the threshold amount to phase out this credit for married couples filing jointly will be increased.
* The tax credit for tuition and related expenses for the Hope Scholarship increases, and a portion of the credit becomes refundable in 2009 and 2010.
* Waives the repayment requirement of the first-time home buyer tax credit for purchases of a principal residence after Dec. 31, 2008 and before July 1, 2009.
* Allows a work opportunity tax credit for companies that hire unemployed veterans and disconnected youth.
* Extends unemployment benefits through the end of December, and temporarily suspends the taxation of some unemployment benefits.
* Allows states to apply to an emergency fund, if their Temporary Assistance to Needy Families caseload for a quarter exceeds its baseline count.
* Makes a one-time payment of $250 to retirees, and the disabled who receive Social Security.
* Provides Medicaid coverage to certain unemployed individuals and their families.