House readies relief package for restaurants, other industries
New legislation would provide $55B for businesses left out of prior relief rounds
The House might vote next week on a small-business pandemic aid package that would provide $42 billion for additional restaurant relief and $13 billion for other “hard hit” industries.
The Rules Committee is scheduled to meet on the revised bill Tuesday afternoon, which indicates floor action soon after. Democratic leaders are whipping the bill to see if there are enough votes to pass it, according to a source familiar with the planning who wasn't authorized to speak publicly.
The restaurant and hard-hit business grant funding would be offset by “all funds rescinded, seized, reclaimed, or otherwise returned” from various programs in prior pandemic relief laws. It was not immediately clear if that would score as a full or partial offset for the $55 billion in total funding.
Rep. Dean Phillips, D-Minn., said in an interview Friday that he has been working with Speaker Nancy Pelosi, D-Calif., for months to provide additional aid to restaurants and other small businesses that were not able to access previous pandemic relief programs. Speaking a few hours before the bill was released, Phillips said he was hopeful for a vote and that there would be bipartisan support given the measure is offset with recaptured fraudulent awards.
“We under-appropriated to begin with,” Phillips said. “So this is about a make-good and not picking winners and losers. And that notion is picking up some steam, recognizing this is not a prospective COVID relief bill. This is a retrospective make-good.”
Phillips said a letter he led to Pelosi and House Appropriations Chair Rosa DeLauro, D-Conn., earlier this month with more than 40 other Democrats, warning they would “be hesitant to support” a COVID-19 supplemental if it did not include aid for the “hardest-hit small businesses,” provided momentum for action on the issue.
Other sectors the group wrote that are deserving of aid include live events venues and planners, hotels and fitness centers. Phillips said aid recipients could also include the motor coach industry and minor league baseball teams, though the new House bill doesn't specify.
Democrats and Republicans in the Senate have been negotiating a COVID-19 supplemental they hope to finalize and pass next week. Before leaving town Thursday, senators said they were closing in on a deal that would provide roughly $10 billion for near-term needs like purchasing more therapeutics, testing supplies and vaccines, which they plan to offset with repurposed funds from prior pandemic relief laws.
The negotiators couldn’t agree on enough offsets for appropriating another $5 billion in foreign assistance, but they were debating whether to take approximately $1 billion from the domestic funds and direct it to overseas vaccination efforts.
Rep. Tom Malinowski, D-N.J., said in an interview Friday that he doesn’t think a supplemental bill could pass the House if it did not include any international funding. That would shut down the United States Agency for International Development’s foreign pandemic aid efforts since the agency is out of money, he said.
“The $1.25 [billion] that Chris Coons and others are trying to put in there is just basic maintenance of current effort for maybe three months,” Malinowski said, noting he would only consider voting for that amount if leadership explains its plan to get more funding approved later. “I want to know: What's the plan to sustain that for the next several years and ideally to get to a point where we can credibly say the United States is a world leader?”
To underscore Malinowski's point, Rep. Salud Carbajal, D-Calif., led a dozen other House Democrats in writing to congressional leaders Friday that a COVID-19 supplemental should contain the full $5 billion foreign aid request. Without that money, they wrote, "efforts to reach unvaccinated populations in countries without the means to produce and deploy vaccines will end."
Senate Small Business Chair Benjamin L. Cardin, D-Md., has separately negotiated a bipartisan small business aid package, which has not been publicly released but is similar to the House bill based on what Cardin has described in recent months. Cardin said in an interview earlier this week that Senate Majority Leader Charles E. Schumer, D-N.Y., was trying to secure an agreement with Republicans to allow a vote on that package as an amendment to the COVID-19 supplemental.
Senate Health, Education, Labor and Pensions Chair Patty Murray, D-Wash., said in a floor speech Wednesday that the Cardin’s small business package should move with the health care-related supplemental, which she's been helping negotiate.
“I feel very strongly we need to pass both bills, so why not get them both done together and as soon as possible,” she said.
If the House passes its small business aid bill as a standalone measure, it’s not clear what that would mean for Cardin’s package. The decision may depend on which chamber acts first. If the Senate adds Cardin’s measure to the supplemental, House leaders can follow through with their plans to pass the supplemental and abandon the standalone small business aid bill.
House bill details
The new $42 billion appropriation for restaurants in the House bill is meant to backfill the Restaurant Relief Fund after the original $28.6 billion Democrats provided in their 2021 pandemic relief law ran out with only one-third of businesses that applied for grants receiving funds.
The $42 billion is expected to be enough to provide grants to the other two-thirds of restaurants and bars that qualified for the funding. But the bill includes language saying that if there’s not enough money to provide full grants to each eligible business, the awards should be reduced by an equal percentage so all approved applicants get some funding. Restaurants and bars must certify that they are still operating or plan to reopen within 6 months to receive any grant funding.
Although the bill does not reopen the Restaurant Relief Fund to new applicants, it requires the Small Business Administration to provide an explanation to those who were previously denied and gives those businesses an opportunity to reapply.
The bill would require the Small Business Administration to conduct oversight and audits of all grant recipients, including those who received awards under the initial $28.6 billion, and report back to Congress.
The other $13 billion in the bill is for a new grant program called the Hard Hit Industries Award Program for businesses that have not received grants or forgivable loans under prior pandemic relief laws.
Businesses would qualify for tax-exempt awards, capped at $1 million per business, if they employ 200 or fewer employees and have suffered a pandemic-related revenue loss of at least 40 percent. The bill says first priority should go to businesses whose loss was greater than 80 percent and second priority to those with losses greater than 60 percent, with businesses that have 50 or fewer employees being considered first in both categories.
The measure excludes certain businesses, including publicly traded companies and those owned or operated by a private equity fund, from qualifying for the hard-hit business grants. It would also require administrative oversight of the grant program and reports to Congress.
The bill also extends the available time for businesses that were previously awarded forgivable loans under the Paycheck Protection Program or grants under the Shuttered Venue Operators program to spend their awards to March 17, 2023, although it provides Small Business Administration with authority to extend that further.
David Lerman contributed to this report.