McConnell: Senate to boost small business loan program with possible action on Thursday

Senate Majority Leader Mitch McConnell announced that the Senate will push this week for additional funds for a small business loan program to keep workers o...

Posted: Apr 7, 2020 11:00 AM
Updated: Apr 7, 2020 6:30 PM

Senate Majority Leader Mitch McConnell announced that the Senate will push this week for additional funds for a small business loan program to keep workers on the payroll during the coronavirus pandemic.

Last month, Congress gave about $349 billion for the Paycheck Protection Program. But Treasury Secretary Steven Mnuchin said on Tuesday that he would speak with congressional leaders to secure $250 billion more for the program.

'It is quickly becoming clear that Congress will need to provide more funding or this crucial program may run dry,' McConnell said. 'That cannot happen. Nearly 10 million Americans filed for unemployment in just the last two weeks. This is already a record-shattering tragedy and every day counts.'

McConnell said he would work with Senate Democratic Leader Chuck Schumer and Mnuchin to approve the boost in funding for the program.

The Office of Management and Budget, in a letter to congressional leaders on Tuesday night, officially requested an additional $251 billion for the Small Business Administration loan program loan program that directs forgivable loans to businesses with fewer than 500 employees on the grounds the money is used to pay salaries, payroll expenses and other costs like mortgages, rent or utilities.

'As of today, the Small Business Administration (SBA) has recorded over 220,000 loans totaling approximately $66 billion,' Russell Vought, the acting director of the Office of Management and Budget, wrote in a letter to Vice President Mike Pence Tuesday. 'Given the level of demand for the program, the Administration believes the funds appropriated for this program will soon be exhausted.'

Any effort that passes the Senate would also need to pass the House. Speaker Nancy Pelosi told CNN's Anderson Cooper on Tuesday that she spoke with Mnuchin earlier in the day.

'We want to make sure that the program is administered in a way that does not solidify inequality in how people have access to capital, but instead (is a) benefit to everyone who qualifies for it. So we want to have certain considerations if we were to go forward with that,' Pelosi said.

Mnuchin told reporters that he hopes the Senate will pass the bill on Thursday and the House on Friday, but it's unclear whether any member will object and delay the process. Rep. Thomas Massie, a Kentucky Republican who attempted to force a full House vote on the most recent coronavirus stimulus bill at the end of March, is not answering directly if he will allow more funding for small business loans to pass the chamber by unanimous consent or voice vote.

It's also unclear how much money the Senate will provide. Sen. Marco Rubio, a Republican of Florida and chairman of the Senate Committee on Small Business and Entrepreneurship, tweeted on Tuesday that the program needs 'at least another $200-$250 billion.'

'The fear that #PPP will run out of money is creating tremendous anxiety among #SmallBusiness,' he wrote. 'We have days, NOT weeks to address this.'

Pelosi told her colleagues in conference calls Tuesday that the House may have to move this week on the package requested by the administration, sources on the calls said. Another source said Pelosi is making clear she is willing to move forward this week if she gets a deal with the administration. Democrats have made a number of requests to be included in the next package, including protections for renters and minority business owners. It's still not clear what Pelosi will ultimately demand of the administration.

Pelosi has made clear this legislation is only an interim deal, and they still to plan to move forward with another plan - called CARES 2 -- in the coming weeks.

Rubio asked Mnuchin to request additional funding for the program after seeing the large volume of loan applications, according to two sources familiar.

Some senators have worried that small business owners may start to turn away from applying for loans if they believe the money won't be there and instead move to lay off workers.

While there have been technical issues with the PPP program, people are still lining up to get money.

'Even with people having trouble with the technology, the demands are there and we are seeing huge numbers of applications from the banks,' one source told CNN. 'The more certainty you can provide, the more likely it is the program is going is going to carry out their objectives.'

This story has been updated with additional developments Tuesday.

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