Cash-strapped small business loan program deadlocked on new funds
The initial pool of $ 349 billion for emergency loans for small businesses derailed by the coronavirus pandemic has dried up as Republicans and Democrats argue over how to replenish the relief program.
The Treasury Department and the Small Business Administration (SBA) have used all of the funds allocated to the Paycheck Protection Program (PPP), which offers forgivable loans to small businesses aimed at preventing workers from going bankrupt and small businesses.
“The SBA is currently unable to accept new applications for the Paycheck Protection Program based on available credit. Likewise, we are unable to enroll new PPP lenders for the. moment, “the SBA said in a statement Thursday morning.
The SBA also said the $ 10 billion Congress allocated to loans for economic disasters has dried up. The program aimed to provide businesses with cash quickly, offering them an advance of $ 10,000 just days after applying for loans of up to $ 2 million.
Created by the $ 2.2 trillion economic relief bill enacted by President TrumpDonald Trump Walensky Says “Now is the Time” to Tackle Gun Violence: A Banks report combats the Jan.6 committee’s efforts to research Legislator Biden’s records to raise federal employee wages effective Jan.1. Last month, the PPP sparked a surge in demand for emergency loans across the United States, crushing banks, credit unions and SBA technology.
Trump, Secretary of the Treasury Steven mnuchinSteven MnuchinMenendez and Rubio Ask Yellen to Investigate JBS Meat Packer The Hill’s Morning Report – Brought to you by Goldman Sachs – Biden rallies Senate MPs behind massive spending plan Mnuchin dodges CNBC questions about knowing if Trump is lying about the election MORE and lawmakers on both sides pledged more money into the program as its initial funding dwindled rapidly, but executives were stuck in a two-week showdown over potential stipulations for the next tranche of loans.
“We urge Congress to allocate additional funds to the Paycheck Protection Program (P3) …
Republicans want to limit an “interim” bill to an additional $ 250 billion for the small business program, which provides loans and grants to businesses with fewer than 500 people.
Senate Majority Leader McConnell (R-Ky.) Tried to push through the funding last week, but it was blocked by Democrats who want to add an additional $ 100 billion for hospitals, $ 150 billion for state and local governments and a boost in food aid. McConnell, in turn, blocked the biggest Democratic package.
“The Republicans tried to pass more money for American paychecks last week. The Democrats blocked it.… The Democrats did nothing and now the program is closed,” McConnell said. tweeted Thursday.
The GOP leader showed no signs of backing off on Wednesday night just hours before small business funds ran out, suggesting his version of the bill was one that could be passed by the Senate with the support of all 100 senators .
“The cost of continued democratic filibuster will be pink slips and closed businesses,” McConnell said in a joint statement with the parliamentary minority leader. Kevin mccarthyKevin McCarthy Photos of the week: Evacuees from Afghanistan, Paralympics and French fire McCarthy: “There will be a day of judgment” for Biden Overnight Defense & National Security: terror in Kabul as explosions kill and injure hundreds of people PLUS (R-California). “We hope Democrats will soon see reason and finally hear Republican repeated calls for a fundraising bill that can quickly gain the unanimous consent of 100 senators and become law.”
The GOP leader has repeatedly urged Democrats to pass free-standing small business funds this week, given warnings from the White House that program resources will run dry. On Tuesday, he accused Democrats of “political games”.
But Democrats have also deepened their positions, with the Senate Minority Leader Charles SchumerChuck Schumer Polluters to help foot conservation bill under Democratic spending proposal Oil producers push Democrats to preserve major drilling deductions Schumer says infrastructure bills would cut emissions by 45% MORE (DN.Y.) and President of the Chamber Nancy PelosiNancy PelosiOn The Money: Powell signals Fed to cut stimulus soon Banks fight Jan 6 committee’s efforts to seek lawmakers’ records (D-Calif.) Urging Republicans to stop “making postures” and start negotiating.
Mnuchin spoke with Democrats, sparking speculation he and Schumer could strike a deal this week.
Senator Doug Jones (D-Ala.) Said on a conference call Tuesday that he understood Schumer and Mnuchin had made “good progress” towards a deal.
Schumer and Mnuchin spoke again on Wednesday, with staff negotiating throughout the day. But until Wednesday evening, they had not come to an agreement. A Senate Democratic aide said negotiations with Mnuchin will continue until Thursday.
If they reach an agreement early in the afternoon, the Senate could try to pass it on Thursday, the next time they are briefly in session at 3 p.m. The House is expected to sit on Friday, otherwise any movement on additional funds will have to wait until next week.
Since neither the House nor the Senate are expected to bring all members back to Washington before May 4, leaders will need the support of every lawmaker to allocate additional funds to the PPP.
We don’t know if they will get it. Some GOP senators have expressed frustration over concerns that small businesses that have not been affected by the coronavirus are seeking funding. Meanwhile, Rep. Thomas massieThomas Harold Massie Sixth House GOP lawmaker fined K metal detector (R-Ky.) Signaled earlier this month that he would try to block passage of the package in the House through a voice vote.
“Once again, they recommend letting Nancy Pelosi go by alone, that we can all stay at home. And I say that is not going to fly, does not go with the Constitution, does not go for accountability to taxpayers, ”Massie said in an interview on Fox Business.
Niv Elis contributed.
Updated at 11:12