Small-Business Aid Stalls in Senate as Democrats Demand More Funds – The New York Times

WASHINGTON A Trump administration request for quick approval of $250 billion in additional loans to help distressed small businesses weather the coronavirus crisis stalled Thursday in the Senate after Republicans and Democrats clashed over what should be included in the latest round of government relief.

The dispute was a prelude to what is likely to be a far more complicated and consequential set of negotiations over a larger infusion of federal aid that lawmakers expect to consider in the coming weeks on the heels of the $2 trillion stimulus law enacted late last month. The White House had asked lawmakers to move in the interim to inject more money into a new loan program intended to keep small businesses afloat and allow them to avoid laying off workers as the pandemic continues to batter the economy.

But Democrats argued that as long as Congress was providing additional aid, it should include more money that was urgently needed for hospitals, states and cities confronting the coronavirus, as well as additional food assistance for Americans coping with its punishing economic toll.

Republicans balked at that effort, saying the time for negotiating such additions was later.

My colleagues must not treat working Americans as political hostages, said Senator Mitch McConnell, Republican of Kentucky and the majority leader. With the Senate not scheduled to return until April 20, he added, lawmakers should have focused discussions on urgent subjects without turning every conversation into a conversation about everything.

During a choreographed exchange on the Senate floor, Mr. McConnell tried to push through the $250 billion in funding for small-business loans during a procedural session, a maneuver that would have required the support of all senators. Democrats objected as promised and proposed doubling that request by adding $100 billion for hospitals and $150 billion for state and local governments, as well as placing conditions on the small-business funds and adding oversight requirements for the administrations coronavirus response.

Yes, we know we need more money for this program, Senator Chris Van Hollen, Democrat of Maryland, said on the Senate floor. But for goodness sake, lets take the opportunity to make some bipartisan fixes to allow this program to work better for the very people its designed to help.

When Mr. Van Hollen countered with the Democrats proposal, Mr. McConnell blocked it, ensuring that the Senate could not move forward on the issue until another procedural session scheduled for Monday.

Democrats said they had been blindsided by Mr. McConnells announcement this week that he would quickly move to approve the administrations request for additional money for the small-business program, and charged that he was merely looking to score political points by trying to do so without making any effort to reach an agreement with them.

There was no effort made to follow the process that we could to get this done, so it wont get done, said Senator Benjamin L. Cardin, Democrat of Maryland, one of the architects of the small-business loan program. He called Mr. McConnells move a political stunt.

Speaker Nancy Pelosi of California, speaking during a news conference call, said that Steven Mnuchin, the Treasury secretary, had called her on Tuesday and asked for a quarter of a trillion dollars in 48 hours with no data.

Although she acknowledged that the offer formed the basis for some negotiation, she reiterated that without the additional aid Democrats were seeking, it could not pass the House. She said that the dispute would not be solved before Easter this Sunday.

I dont have any intention of spending any one second on Sunday trying to convince anybody that it is necessary to address the needs of everybody in our society, Ms. Pelosi told reporters. If they dont share that value, theyre not going to get it on Sunday.

Mr. McConnell, leaving the Senate floor on Thursday, told reporters that lawmakers would have a continuous discussion as to how to move forward.

No one is necessarily against additional assistance, he said. Much of the rest of the money has not gone out yet. So its hard to measure the effect of that and the additional need.

Republicans and administration officials have said that the soaring demand for the small-business loan initiative, called the Paycheck Protection Program, warrants a stand-alone bill, while other demands should wait for negotiations on the broader package that lawmakers have begun referring to as Phase 4 of their coronavirus aid efforts.

With most of the funds from the $2 trillion economic stimulus plan just beginning to trickle out to agencies and taxpayers, they argued that it was premature to allocate billions more dollars this week.

The president has been very clear, Mr. Mnuchin said Thursday in an interview with CNBC. Hes happy to talk about other issues such as hospitals and states in the next bill, but we wanted to go and get money for the small-business program.

The stimulus package enacted last month created the Paycheck Protection Program and provided $350 billion for it. Its rollout has been plagued with problems, even as it has been inundated with requests from companies desperate to avoid collapse.

Senator Marco Rubio, Republican of Florida and a vocal program advocate, said as of 2 p.m. Wednesday, more than 400,000 small businesses had been approved for loans, at a value of more than $100 billion.

The program is going to come to a halt, and theres going to be millions of small businesses locked out, on the outside looking in, Mr. Rubio warned in a video posted on Twitter. It will be because today in the Senate, Senate Democratic leaders decided to take the program hostage, hostage as leverage for unrelated items.

In addition to providing more money, the Democratic proposal would have placed new conditions and disclosure requirements on the administration, according to a summary released on Thursday. There were additional guidelines to streamline the lending process through the Paycheck Protection Program, and to expand its eligibility to include farms.

Some of the new small-business loan funds would also be reserved for small, community-based lenders, disaster grants or loans. Those included $50 billion for the Economic Injury Disaster Loan program, which has typically been used to help companies after natural disasters. The program has run low on funding, and applicants are unclear what aid, if any, they will receive.

There is a disparity in access to capital in our country, Ms. Pelosi said. We do not want this tragedy of coronavirus to exacerbate that disparity.

The Department of Health and Human Services and the Federal Emergency Management Agency would have had to report to Congress monthly on the administrations coronavirus testing strategy, as well as on the allocation of testing and supplies.

And the administration would have had to submit a separate report by May 15 on the demographics of patients who had contracted Covid-19, the disease caused by the coronavirus, and its strategies for reducing health disparities related to it. That proposal came about after data emerged suggesting that the disease was infecting and killing black people in the United States at disproportionately high rates.

Alan Rappeport contributed reporting.

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Small-Business Aid Stalls in Senate as Democrats Demand More Funds - The New York Times