It focuses primary on small-business loans but includes money for hospitals and testing as well.
After a critical small-business loans program ran out of money last Thursday, the pressure has been on for Congress — and Democrats in particular — to end a weeks-long impasse and approve more funding for it. In the coming days, lawmakers may be set to do just that.
Democrats and Republicans this weekend indicated that they were close to a deal on what they’re calling an “interim” spending bill that’s intended to give small-business loan programs — including the Paycheck Protection Program and the Economic Injury Disaster Loan program — a major boost.
“We have common ground,” House Speaker Nancy Pelosi said during an appearance on ABC’s This Week. “I think we’re very close to agreement.”
The latest legislation, which follows the $2 trillion CARES Act stimulus that lawmakers approved in March, is focused primarily on small businesses, many of which have been hit especially hard by the coronavirus pandemic’s economic fallout.
Although the stimulus included in the CARES Act already allocated $360 billion for new small-business loans, that money was depleted in a matter of weeks. While more than 1.6 million small businesses have obtained PPP loans so far, hundreds of thousands of others have seen their applications sit in limbo simply because the programs are out of money.
Congress’s latest bill is poised to include roughly $450 billion in funding, including about $350 billion to replenish the small-business loan programs, $75 billion for hospitals, and $25 billion for testing, according to Treasury Secretary Steven Mnuchin. The exact figures for the deal are still being negotiated along with the specifics regarding how the funding for testing would be doled out, CNN reports — so there could be some characteristic delays in actually getting it passed.
If lawmakers can reach an agreement soon, the House and Senate are set to pass it swiftly this week — though procedural opposition in the lower chamber could mean that at least half of the House’s members would have to return for an in-person vote. (If just one Congress member opposes the deal, that person can call for a quorum and roll-call vote, which would require the majority of the House to be present.)
This interim package is expected to precede another massive stimulus bill, which Congress is slated to work on in the coming months.
What the “interim” spending package includes
The interim spending package reflects a compromise between Democrats and Republicans, who’ve been at an impasse over this bill for more than two weeks.
While the two parties broadly agree on the need to allocate more funding for small businesses, Democrats have focused on using the leverage they have to push Republicans to consider a more generous spending package that would address shortfalls that hospitals, states, and cities are experiencing as well.
This tactic has been successful, in part. The anticipated spending deal is more expansive than the original Republican proposal; that was limited to $250 billion in funding for the Paycheck Protection Program, which provides forgivable grants to businesses and nonprofits. The newer version also includes about $50 billion for the Economic Injury Disaster Loan program, which has emergency grants that can expedite relief for these organizations.
Additionally, the deal contains $75 billion for hospitals, which have been overwhelmed by the simultaneous costs of preparing for the coronavirus and the revenue declines that have resulted as elective procedures are postponed. Another $25 billion is intended to help ramp up the country’s testing capacity, a development that experts view as vital to determining when to reopen the economy more fully.
The main Democratic demand that has been omitted from this deal is the additional funding that lawmakers would like to see go to cities and states — many of which are facing incredible financial strain given reductions in tax revenue and a surge in costs to combat the coronavirus. Mnuchin signaled that this issue would be addressed as part of negotiations for the next funding bill.
“The president has heard from the governors and he’s prepared to discuss that in the next bill,” Mnuchin said during an appearance on CNN’s State of the Union.
Trump’s reluctance to consider state funding in the current bill is the result of a couple of factors, according to Politico. Among them: The administration is concerned that it would have less leverage over the states regarding when they reopen their economies if they had more funding to help them weather this period.
This bill is not anticipated to address an expansion in SNAP (food stamp) benefits and hazard pay for front-line workers, either.
Lawmakers are continuing negotiations on the specifics of this “interim” spending deal, with the goal of announcing the final version later on Monday or Tuesday. Once they do, both the Senate and the House intend to take it up in rapid succession.
The majority of members in both chambers are working remotely and not physically present at the Capitol, which could pose a procedural challenge later this week.
When votes were taking place on the CARES package in March, for example, Rep. Thomas Massie (R-KY) demanded a quorum — or a majority of the House — be present for the vote. It is possible that Massie or another member might make the same request again, meaning some members would have to travel back to the Capitol.
Pelosi has also said that the House could consider the use of proxy voting for future bills, if members continue to work remotely during the pandemic. Were members to move forward with this approach, the House would have to vote on a rule to approve proxy voting. Like the name suggests, proxy voting enables members to allow someone who’s physically present in the House chamber to vote on their behalf, so not everyone would have to travel back to Washington.
Given the scale of the economic impact that workers and businesses have seen so far, the next package could potentially surpass the first CARES Act in cost and size. Democrats and some Republicans are pushing for the consideration of more ambitious proposals, including for the government to cover a portion of payrolls for companies that have been affected by the economic crisis.
“This is a time for all of us to be creative,” Sen. Mark Warner (D-VA) recently told Vox.
Author: Li Zhou