Congress Still At Stalemate Over Another Round Of Coronavirus Relief

The congressional stalemate over another fiscal package aimed at providing relief to those struggling from the coronavirus pandemic dragged into another week as both sides dug in and accused each other of stalling critical aid to millions of Americans.

Top Democrats reiterated that more funding was needed beyond aid to small businesses, including money for hospitals, states and local governments, as well as food assistance to low-income individuals and families. 

“We have real problems facing this country, and it’s time for the Republicans to quit the political posturing by proposing bills they know will not pass either chamber and get serious and work with us towards a solution,” House Speaker Nancy Pelosi (D-Calif.) and Senate Minority Leader Chuck Schumer (D-N.Y.) said in a joint statement on Monday.

Their demands were backed up by a bipartisan duo ― New York Gov. Andrew Cuomo (D) and Maryland Gov. Larry Hogan (R) ― who asked Congress for an infusion of $500 billion to help states meet budget shortfalls that have resulted from the coronavirus pandemic.  

Republicans, meanwhile, continued to insist over the weekend that Congress should move quickly to approve funding only to the small business Paycheck Protection Program, which they warned would soon run out of money as early as this week. Congress included the program in its $2 trillion stimulus bill it passed two weeks ago as a way to ensure people remain employed.

“This crucial program needs funding now. American workers cannot be used as political hostages,” Senate Majority Leader Mitch McConnell (R-Ky.) and House Minority Leader Kevin McCarthy (R-Calif.) said Saturday.

Congress initially allocated $350 billion for the program, making it a bigger part of the coronavirus relief bill than expanded unemployment benefits or direct payments to households. The program essentially pays two months of payroll expenses through loans that are forgiven if a company avoids big layoffs or pay cuts.

The Small Business Administration, which runs that program with Treasury’s backing, said Monday morning that more than 880,000 applications had been approved, with loan amounts collectively totaling approximately $217 billion.

Approved loan applications, however, are not the same as actual loans, and many entrepreneurs are waiting anxiously for the money, which is supposed to be distributed by banks. 

Jake Braun, owner of a digital marketing firm with seven employees in St. Petersburg, Florida, said he is still waiting for his loan. His company has long had a checking account with Bank of America, but Braun wound up applying through a regional lender because when the program first launched, Bank of America restricted applications to existing customers with multiple accounts. The bank has since changed its policy, but Braun said he went with a smaller bank because he feared big banks would funnel all the money to their bigger customers. 

Braun is optimistic about the loan, but he’s still waiting. 

“I’m just nervous that something with the SBA prevents it from going through,” Braun said.

In their letter, Pelosi and Schumer said the program needs new rules, since “many eligible small businesses continue to be excluded from the Paycheck Protection Program by big banks with significant lending capacity.”

Another problem is that Congress hasn’t said whether payroll expenses covered by the loans are tax-deductible like they normally would be. The law states that the forgivable loans won’t count as income, but if the payroll expenses aren’t deductible, it would diminish the value of the program. 

A big reason why Congress is struggling to reach a deal on additional coronavirus relief is because any quick action requires unanimous consent. Both chambers are technically on recess and are not expected to return to vote until April 20 at the earliest, but lawmakers say that date is optimistic.

Democrats last week blocked McConnell’s unanimous consent request to pass additional funding for the small business loan program only, and Republicans blocked a Democratic request to pass additional funding for hospitals and states in addition to small businesses.

Schumer said last week that Treasury Secretary Steven Mnuchin had “agreed to pursue bipartisan talks” on an interim spending package that included aid to small businesses. But Republicans and the White House pushed back on that characterization.

The Senate gaveled in and out of a pro forma session in just seconds on Monday with no business being conducted. The next session is scheduled for Thursday.

The partisan wrangling over what was supposed to be a quick way to boost relief to those struggling amid the coronavirus pandemic does not bode well for prospects of a deal on another so-called “phase four” congressional aid package. Democrats have said they’d like to see broader measures in the next bill like expanded vote-by-mail to ensure voters can safely participate in the November presidential election. But Republicans are fiercely opposed to mandating voting reforms on all states, setting up a big fight in the coming weeks.


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