House vote on package expected Thursday
Published: April 21, 2020 at 5:15 p.m. ET, By Robert Schroeder, Victor Reklaitis and Jonathan Nicholson
The U.S. Senate on Tuesday approved a nearly $500 billion aid package for small businesses and hospitals hit hard by the coronavirus pandemic, setting up a vote in the House of Representatives as President Donald Trump threw his support behind the measure.
Senate Majority Leader Mitch McConnell said the deal includes more than $320 billion for small businesses, a top priority for Republicans wanting to replenish funding for the Paycheck Protection Program.
Senate Minority Leader Chuck Schumer and House Speaker Nancy Pelosi said Democrats were proud to have secured an agreement on what they called “an interim emergency funding package.” The measure passed by voice vote.
Rep. G.K. Butterfield, a North Carolina Democrat, said the PPP would now include small banks, credit unions and nonprofits — a top priority for Democrats who said the program’s requirement for pre-existing relationships with banks to be eligible was too restrictive.
The deal provides $100 billion for health care, split between $75 billion for hospitals, including some set aside for rural ones, and $25 billion for coronavirus testing. Another $60 billion would go to the Small Business Administration’s Economic Injury Disaster Loan program.
Only $10 billion of the EIDL money would be in the form of grants, a House Democratic aide said. That may keep the deal’s cost slightly lower when the Congressional Budget Office puts a final price tag on it.
Related: Small-business owners express confusion, fear over federal bailout fund
And see: Coronavirus small-business aid program could ultimately need $1.8 trillion in funding
Treasury Secretary Steven Mnuchin reached the agreement with top Democrats and Republicans on Capitol Hill. Trump on Tuesday afternoon urged lawmakers to pass the agreement, and said he was looking ahead to the next round of aid.
I urge the Senate and House to pass the Paycheck Protection Program and Health Care Enhancement Act with additional funding for PPP, Hospitals, and Testing. After I sign this Bill, we will begin discussions on the next Legislative Initiative with fiscal relief….
— Donald J. Trump (@realDonaldTrump) April 21, 2020
Republicans had pushed for a bill that just replenished the loan program for small businesses, and they had resisted Democratic calls for tacking on other provisions, such as money for health-care institutions or having more PPP loans channeled through community-based financial institutions that serve a diverse range of enterprises.
The loan program for small businesses initially received $350 billion in last month’s $2.2 trillion coronavirus package, known as the CARES Act, or Washington’s “Phase 3” response to the pandemic. The PPP ran out of money last Thursday.
In addition to boosting the PPP, which some analysts are describing as a “Phase 3.5” response, Democratic and Republican lawmakers and the Trump administration are working on “Phase 4” legislation targeting the coronavirus crisis. Analysts have predicted that the next big spending package, also called CARES 2, could cost about $1 trillion and not become a reality for several weeks.
In his tweets Trump said a new round of negotiations would begin on providing fiscal relief to state and local governments; infrastructure; and tax incentives for businesses and individuals.
U.S. stocks SPX lost more than 600 points Tuesday, a second day of sharp losses after a historic fall in oil prices.
Now read: Why oil prices just crashed into negative territory — 4 things investors need to know.
House Majority Leader Steny Hoyer told reporters Tuesday that the House will return on Thursday to vote on the coronavirus bill.
Source: www.marketwatch.com