The Senate passed a $483.4 billion economic relief measure Tuesday that would replenish a popular small-business loan program and provide funding for hospitals facing financial shortfalls due to COVID-19.
Top Democrats and the Trump administration reached agreement on the legislation earlier in the day after weeks of sometimes testy negotiations.
The Senate’s voice vote, which occurred in a nearly empty chamber, sends the bill to the House for final passage likely on Thursday. House lawmakers are headed back to Washington for that vote, due to objections to a voice vote or unanimous consent.
President Donald Trump tweeted support for the measure Tuesday morning before it was released, saying he would sign it when it reaches his desk.
Trump said additional items left out of the latest bill, such as more funding for states and localities, could be included in the next round of aid.
Speaker Nancy Pelosi and Senate Minority Leader Charles E. Schumer announced their support for the measure shortly before the Senate gaveled in for its 4 p.m. session.
Top Democrats are calling the small-business and health care package an “interim” measure to serve as a bridge to a larger bill that could be considered next month.
The next bill could include another round of direct payments to households as well as an extension of new jobless benefits provided in the roughly $2 trillion aid package enacted last month.
‘Interim’ bill details
The legislation would provide $310 billion to restart the Small Business Administration’s so-called Paycheck Protection Program, which ran out of money late last week amid higher-than-expected demand for the forgivable loans designed to keep workers on the payroll while businesses are closed due to the coronavirus pandemic.
An extra $10 billion is included for administrative costs, such as fees paid to lenders participating in the program, according to sources familiar with the plan who weren’t authorized to speak publicly.
A total of $60 billion of the PPP funding would be set aside for smaller lenders, including state and federal credit unions and those serving communities where relationships with more established financial institutions that dominate the SBA program are scarce.
That pot of money for “underbanked” communities will be divided in half between lenders with less than $10 billion in assets and those with between $10 and $50 billion in assets.
The new loan program funds could run out nearly as fast as the previously approved funding, which lasted about 14 days. That will likely put a timer on Congress’ efforts to negotiate a larger, more sweeping aid package that Republicans, Democrats and the Trump administration all agree is needed.
“The first [round] went like hotcakes. So the second one could go like hotcakes too,” National Economic Council Director Larry Kudlow said Monday of the PPP funding.
The bill would provide $50 billion more for emergency disaster loans, another popular program that businesses are using to try to stay financially solvent as they remain closed to reduce the spread of the virus. Small farming operations with no more than 500 employees would be eligible to participate in the loan program.
There’s also $10 billion for grants of up to $10,000 each that disaster loan recipients can obtain, and $2.1 billion for the administrative costs of running that program.
Hospitals and other health care facilities will receive $75 billion to help treat patients with the virus and address revenue shortfalls they are facing as a result of the pandemic.
The number represents a compromise between Democrats, who pushed for $100 billion, and Republicans, who wanted to wait until a later package to provide any funding on top of the $100 billion in last month’s roughly $2 trillion relief package. The money will go into the Department of Health and Human Services’ Public Health Social Services Emergency Fund.
National testing strategy
Lawmakers included $25 billion for more COVID-19 tests as well as a nationwide testing approach, something Democrats and governors have been urging so state officials can begin to think about reopening their economies once cases begin to subside.
How to allocate the testing money had been a key hang-up over the past several days in getting an agreement, with Democrats pressing a national testing strategy and the White House advocating state control of the program.
Under the compromise, the money would be divided between states and the federal government as follows:
- $11 billion for states, local government, territories and tribes to develop tests for COVID-19, ramp up laboratory capacity, trace the spread of the disease and support employer testing, as well as provide funds for employers to test. Of the total, $4.25 billion would be provided to areas based on the number of COVID-19 cases; $2 billion would be distributed to states according to a grant formula in which every state will receive some money; and $750 million would go to tribes, tribal organizations and urban Indian health organizations in coordination with the Indian Health Service.
- $1 billion for the Centers for Disease Control and Prevention for surveillance, expanding laboratory capacity and “contact tracing” or tracking the spread.
- $1.8 billion for National Institutes of Health to develop and implement testing, accelerate research into rapid testing, and establish partnerships with government and nongovernment entities to fight the pandemic.
- $1 billion for the Biomedical Advanced Research and Development Authority for research, development and production of COVID-19 tests and supplies.
- Up to $1 billion to cover costs of testing the uninsured.
- $825 million to support community health centers and rural health clinics, and another $22 million for the Food and Drug Administration to support testing.
The testing provisions require that states, local government and other recipients of the testing dollars file plans for how they will spend the money.
The White House on Monday threw its support behind additional funding for states to conduct contract tracing, a process under which health officials can track who a patient has interacted with so they can enter quarantine and get tested.
The bill didn’t get unanimous support from Senate Republicans, however. Critics cited the impact on the national debt as well as the closed-door negotiations that produced the compromise.
“No amount of money, not all the money in China will save us from ourselves,” said Rand Paul, R-Ky. “Our only hope of rescuing this great country is by reopening the economy.”
Combined with other rescue packages enacted since mid-March, the total added to deficits over the next decade is about $2.4 trillion, according to the Congressional Budget Office.
Governors come up short
Governors and city and county officials wanted the bill to include funding to help address budget shortfalls they face as tax revenues drop off a cliff and spending increases sharply.
There’s no additional direct aid in the latest package, although Schumer said the White House has committed to more funding in the next aid package.
The New York Democrat told senators in a letter on Tuesday that the administration has also agreed to a future provision letting states and localities use $150 billion in last month’s aid package to cover revenue gaps, rather than only coronavirus-related expenses.
“We have said with one voice, you want the governors to do the job, we need you to provide funding for state governments,” New York Democratic Gov. Andrew M. Cuomo said Monday.
Without sufficient funding from the federal government, Cuomo said, New York would have to cut aid to schools, local governments and hospitals by 20 percent each.
“This is the worst time to do this,” Cuomo said.
The bill also doesn’t include additional food aid. Democrats originally requested this “interim” measure include a 15 percent increase to the maximum monthly benefit received by people on the Supplemental Nutrition Assistance Program. Republicans were opposed.
Lindsey McPherson, David Lerman and Niels Lesniewski contributed to this report.