Trump administration, congressional leaders near deal on virus aid that includes major boost for small businesses - The Washington Post

“I think we are getting close to a deal,” Trump said at the daily briefing of his coronavirus task force. He said he had just spoken with Treasury Secretary Steven Mnuchin, who has been leading negotiations for the White House.

“We have some very good negotiations going on right now, and I think you could have a nice answer tomorrow,” Trump said.

Earlier, speaking on CNN, Mnuchin said he hoped the Senate would pass an agreement on Monday, when the chamber is scheduled to come into session briefly in the afternoon. In a further sign of progress, House Majority Leader Steny H. Hoyer (D-Md.) told representatives Sunday evening to be prepared to return to the Capitol on Wednesday to vote on the emerging agreement.

The agreement would include $75 billion for hospitals and $25 billion for testing, which have been major Democratic demands. Some of the money in the small-business program would be directed specifically to rural and minority businesses, said people familiar with the plan who spoke on the condition of anonymity to describe it.

“We want to make sure that it’s reaching all of America’s small businesses,” House Speaker Nancy Pelosi (D-Calif.) said on ABC News. “And we also want to make sure that it’s operating in a community where our police and fire, our health-care workers, our doctors, nurses, our teachers are being compensated for and not fired. And that’s why we’re asking for the additional funds in the package, as well as for hospitals so that we can do testing, testing, testing.”

“I think we’re very close to agreement,” Pelosi said. The lack of testing has been a major pressure point throughout the pandemic, with lawmakers and governors lashing out at the federal government for its failures in that regard even as Trump has increasingly blamed governors.

“We’re talking about a $25 billion federal program, money that can be used with the states with new technology to invest in testing,” Mnuchin said.

Another major Democratic request — money for cities and states — appeared left out of the deal, although congressional aides cautioned that the agreement was not final.

Mnuchin said that he had been in close contact with GOP congressional leaders and that “we’re all on board with the same plan.”

The $2 trillion economic rescue that Congress passed last month created the $349 billion Paycheck Protection Program, which allowed banks to issue taxpayer-backed loans to small businesses to help them weather the pandemic. The loans were supposed to go to businesses with fewer than 500 workers and would be forgivable if the companies kept workers on the payroll.

On Thursday, the White House said nearly all of the $349 billion had been committed and the Small Business Administration stopped backing new loans. The White House said the program allowed 1.6 million companies to receive the loans, and most of the money must be spent on paying the wages of employees to minimize job losses during the pandemic. More than 22 million Americans have filed for unemployment benefits in the past four weeks.

Even with the 1.6 million loans, it appears that a fraction of companies received the taxpayer assistance. The nation has 30 million small businesses, and many firms complained that they were blocked from accessing the money. On CNN, Mnuchin was asked whether Congress would need to appropriate even more money on top of the $300 billion to help more companies, and he said the $300 billion would be sufficient.

If the changes are voted into law this week, Congress would have approved more than $700 billion in emergency assistance for small businesses alone in just one month. That would be more than the entire $700 billion in bailout approved during the 2008 financial crisis.

But the financial crisis money had strict requirements regarding public disclosure of who received the money. Under the current arrangement set up by Congress and the White House, it’s unclear whether the public will ever find out the recipients of the new money. The White House has said businesses, nonprofit organizations, churches and affiliates of large companies can seek the money.

There have also been complaints that some of the small business money has been claimed by relatively large companies such as Ruth’s Chris Steak House, applying through big banks and in some cases finding ways around the $10 million loan limit by having different subsidiaries each apply for that amount of money.

Responding to that criticism, Mnuchin said that community banks have “done an extraordinary job” participating in the programs, with 60 percent of the loans approved by banks with $10 billion or less in assets.

The new money for hospitals in the agreement would come on top of $100 billion in the original $2 trillion rescue bill. Hospitals have been begging for additional relief, with some overwhelmed by treating covid-19 patients and others losing nearly all revenue and laying off staff members because they are no longer doing elective procedures.

Democrats had also been demanding an additional $150 billion for cities and states whose budgets have been decimated by the economic toll of the coronavirus. But Republicans have opposed that, insisting that it was not the federal government’s job to make up for state budget shortfalls.

In a conference call with Senate Republicans on Sunday afternoon, Mnuchin and Majority Leader Mitch McConnell (R-Ky.) touted the increased Paycheck Protection Program money and assured lawmakers that the Democrats’ demands for funding for state and local governments would not be met, according to a Senate GOP leadership aide, who spoke on the condition of anonymity to describe the private call.

Mnuchin told lawmakers that the language around testing was the one area that remained to be resolved, the aide said.

Trump said at his news conference later that he supports addressing the needs of state and local governments, but that “we will be saving that for another time.” After passing this interim measure with more money for small businesses, hospitals and testing, Congress is expected to turn its attention to another major rescue bill.

Lawmakers have been squabbling over the Paycheck Protection Program almost since the moment it rolled out April 3, as it became immediately clear that it would run out of money. Democrats infuriated McConnell by refusing to agree to a straight funding increase without conditions, and negotiations stalled until finally picking up in recent days, with Democrats’ push for money for state and local budgets emerging as a red line for Republicans.

Maryland Gov. Larry Hogan (R), who chairs the National Governors Association, has joined other governors in asking the federal government to approve $500 billion in additional spending for them. But he said on CNN on Sunday that he didn’t want funding for small businesses held up as lawmakers and the administration wrangle over states’ requests.

“We’re just hopeful that we can get all these parties to agree and put aside the partisanship in the U.S. Senate, get the administration and the senators on both sides of the aisle to reach some kind of a deal to get it done, because we do need to get this money out for our small businesses, and certainly the hospitals need help as well,” Hogan said.

Massachusetts Gov. Charlie Baker (R) said on CBS News that additional funding for states will be necessary to meet Trump’s goal of reopening the economy.

“It’s important for the feds to support our efforts to fund the stuff we do,” Baker said. “If we’re laying off tens of thousands of people at exactly the time when they want to reopen the economy, we’re gonna be swimming against the current they’re trying to create.”

The House and the Senate have been out of session since passing the $2 trillion Cares Act late last month and some members have been reluctant to return to Washington en masse. In the Senate, leaders would like to pass the legislation by “unanimous consent” so that only a few members would have to be present for the proceedings, but any one senator could object and block that plan.

In the House, though, GOP lawmakers have indicated that they intend to demand a recorded vote that would require a majority of lawmakers to be present, leading Hoyer to notify lawmakers Sunday that they should be prepared to return to the Capitol. Democrats could use the forced vote as the moment for Pelosi to push a rules change allowing for members to cast future votes from afar by proxy through other lawmakers in attendance, and also push through the creation of a new select committee to oversee implementation of the well over $2 trillion allocated to fighting the virus through the Cares Act and other bills.

Mike DeBonis and Paul Kane contributed to this report.


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