Senate Approves $480 Billion More Aid for Small Businesses, Hospitals and Testing After Weeks of Partisan Infighting

On Tuesday, the Senate advanced by voice vote another relief package worth nearly half a trillion dollars for small businesses, hospitals and coronavirus testing after weeks of intense negotiations between Democrats and Republicans and the Trump administration.

The majority of the roughly $480 billion approved—$380 billion—is designed to replenish initiatives that provide small businesses with loans for operating and payroll costs, mainly the Paycheck Protection Program (PPP) that offers forgivable loans. The initial $349 billion assigned to the program under last month's $2.2 trillion stimulus ran dry last Thursday amid partisan infighting over how the fund should be refilled.

Of the approximately $380 billion for small businesses, $60 billion is set aside for community banks and "underbanked" businesses and non-profits that Democrats said lacked access to the program, such as those that are rural or owned by minorities or women. An additional $60 billion is provided for the Small Business Administration's (SBA) economic disaster relief fund.

More than 1.6 million businesses depleted the first round of PPP funding in roughly the first two weeks, with the SBA saying it doled out "more than 14 years' worth of loans in less than 14 days." That raises the question of how long the new money will last and whether lawmakers may sooner rather than later have to approve funds for small businesses a third time. The SBA did not respond to Newsweek's inquiry about how many small-business loan applications are waiting in the queue since the initial money was diminished.

"We'll see how quickly this next tranche of money will be used," House Majority Leader Steny Hoyer (D-Md.) told reporters before the vote. "We may well have to expand upon that."

Senate Majority Leader Mitch McConnell (R-Ky.) heeded more caution. "I think we ought to be carefully calibrating as we move along here what's working and what isn't and be a little more cautious and make sure everybody is here with full membership before we address another phase," he told reporters following the vote.

Senate approves more small-business funding
A sign reading "Buy Local" with closed restaurants and shops on Main Street on April 10 in Livingston, Montana. Photo by William Campbell/Corbis/Getty

The aid also designates $25 billion for an expanded coronavirus testing strategy and $75 billion for hospitals and health care providers, two items that were major sticking points for Democrats. States will lead the expansion of testing, something Republicans pushed for against Democratic wishes to have the federal government handle it as regions across the country will begin to reopen their economies through a series of phases.

The emergency relief is expected to pass Congress and be signed into law by President Donald Trump as early as this Thursday.

"It's unfortunate that it took our Democratic colleagues 12 days to agree to a deal that contains essentially nothing that Republicans ever opposed," McConnell said on the floor. "In my view, it's indefensible that Main Street's small businesses and their workers had their assistance cut off for partisan leverage."

The final $480 billion price tag was a culmination of almost two weeks of talks between congressional Democrats, including Senate Minority Leader Chuck Schumer (D-N.Y.) and House Speaker Nancy Pelosi (D-Calif.), and Treasury Secretary Steven Mnuchin. Senate Democrats blocked a GOP effort to refill PPP the day it ran out. A lengthy impasse persisted over appropriating more emergency small-business funding that was so quickly drained as Republicans and Democrats proposed dueling proposals.

"Democrats flipped this emergency package from an insufficient Republican plan that left behind hospitals and health and frontline workers and did nothing to aid the survival of the most vulnerable small businesses on Main Street," Schumer and Pelosi said in a joint statement. Schumer later accused his Republican colleagues of trying to "steamroll" Democrats.

Senate approves more small-business funding
(L-R) U.S. Senate Minority Leader Chuck Schumer (D-NY) looks on as Majority Leader Mitch McConnell (R-KY) speaks during a Congressional Gold Medal ceremony at the U.S. Capitol on January 15 in Washington, DC. Photo by Drew Angerer/Getty

Republicans and Mnuchin originally sought to immediately inject another no-strings-attached $251 billion into the fund before it ran out last week. But Democrats first wanted assurances that a portion of the money would go to rural, minority and women-owned small businesses they say were underserved. They demanded more money for hospitals, state and local governments, and food stamps.

The first batch of PPP loan funding saved 30 million jobs, Mnuchin said Tuesday at the White House coronavirus task force briefing. Data from SBA showed the average loan size from the first tranche of money was $260,000, with 74 percent of them at less than $150,000. The top industry recipients included construction, scientific and technical services, manufacturing, health care and social assistance, accommodation and food services and retail.

Ultimately, the final version passed Tuesday provides Democratic asks like hospital funding and PPP money for underserved and small businesses. It omits more money for local and state governments, the U.S. Postal Service, food stamps, the District of Columbia and vote-by-mail efforts. Democrats have vowed to "see to it" that the excluded provisions be included in a subsequent fourth package.

"We're not going to cure the economic problem unless we can cure the health problem," Schumer said on the floor. "We can give loans to small businesses, but if there are no customers walking the streets, what good is that?"

GOP Senators Mike Lee of Utah and Rand Paul of Kentucky gave floor speeches advocating for Congress to be immediately recalled from recess in order to conduct legislative business, admonishing the process by which congressional leaders and administration officials have worked exclusively among themselves to craft coronavirus stimulus packages. Neither lawmaker objected to Tuesday's voice vote.

The nearly half-trillion-dollar legislation now heads to the House, where it's expected to be approved Thursday, though likely not without drama. Hoyer is urging any member who can safely do so to return to Washington in anticipation of GOP opposition to unanimous consent.

Rep. Thomas Massie (R-Ky.) forced hundreds of members to return last month for the approval of the more than $2 trillion stimulus. He's signaled that he'll again do the same by blocking a voice vote.

More liberal Democrats, such as members of the Congressional Progressive Caucus (CPC), have voiced concerns that the package stops short of providing enough aid to struggling Americans and local governments, and that they may not support it. However, they have stopped short of saying they'd block its unanimous passage.

"It is insulting to think we can pass such a small amount of money in the context of not knowing when Congress is even going to reconvene and pass such a small amount of money, pat ourselves on the back and then leave town again," Rep. Alexandria Ocasio-Cortez (D-N.Y.) said Monday, adding that she may refuse to back the measure.

Rep. Pramila Jayapal (D-Wash.), CPC co-chair, said the prospect of including other funding aspirations in future legislation has some Democrats concerned "about giving away leverage now without getting some of the priorities that we need."

In a clear signal to Republicans on Capitol Hill, Trump urged lawmakers in a pair of tweets to approve the funding. Items like local and state government funding, infrastructure investments, "tax incentives" for the restaurant, entertainment and sports industries, and payroll tax cuts to "increase Economic Growth" would be addressed in the "next Legislative Initiative," the president added.

House Republican leadership is actively encouraging its members to travel to Washington—"if they are able to safely make it," read a notice to members from the office of Minority Whip Steve Scalise (R-La.)—andsupport the small business relief.

GOP leadership is encouraging Republicans to vote against an effort by Democrats to temporarily change the chamber rules amid the pandemic to allow proxy voting and to conduct certain business, such as committee hearings, remotely. Scalise's office labeled it a "proxy voting scheme."

This story was updated to include information from the office of Rep. Scalise.