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A bipartisan group of lawmakers released proposed COVID-19 relief legislation that may provide momentum for breaking a months-long impasse, by separating out coronavirus liability protections and state aid — the two most contentious and partisan items, Bloomberg News reported. After Republicans and Democrats failed to come to a consensus on a liability shield for employers, the group that has been working on a bipartisan compromise released two separate legislative proposals. One is for $748 billion and includes areas of accord like vaccine funding and aid to small businesses, and the other wraps the two most contentious items, including $160 billion for regional authorities. Senator Dick Durbin, the No. 2 Democrat in that chamber and one of the negotiators, said that state and local aid and liability are both “critically” important but said that House Speaker Nancy Pelosi and Senate Majority Leader Mitch McConnell should allow votes on the $748 billion consensus measure in coming days. He said the aid it contains is “desperately needed.” McConnell has for days said that the two biggest roadblocks should be set aside, with lawmakers proceeding with the remainder — which includes aid for small businesses, help for the unemployed, funding for vaccine distribution and rescue money for airlines and other transportation providers. If endorsed by Pelosi and Senate Minority Leader Chuck Schumer, a separate vote on the $748 billion in COVID-19 relief could offer the first bipartisan backing of both houses of Congress for a stimulus bill since the spring — after months of stalemate. Pelosi and Schumer have argued that the funding for states and localities is too important to allow consideration for a more targeted bill. The bipartisan group’s $748 billion package includes $300 billion for help to small businesses, including through the Paycheck Protection Program, $180 billion for additional unemployment insurance, $45 billion for transportation including airlines and $82 billion for education. Other provisions include $25 billion for housing assistance, $16 billion for vaccine distribution and testing, and $10 billion each for child care, the U.S. Postal Service and rural broadband. Also offered is $25 billion in emergency rental aid and an extension in a moratorium on evictions to Jan. 31. Lawmakers from both sides of the aisle have warned about the potential bankruptcy of smaller enterprises across the country without a renewal of the Paycheck Protection Program. Read more.

Click here to access the bill text of the Bipartisan COVID-19 Emergency Relief Act of 2020. 

Click here for bill text of the Bipartisan State and Local Support and Small Business Protection Act of 2020. 

A bipartisan group of lawmakers is splitting its $908 billion coronavirus relief proposal into two packages as it prepares to release text today, The Hill reported. The plan will include a $160 billion proposal that ties together the two most controversial elements: more money for state and local governments and protections against coronavirus-related lawsuits. The second proposal will total $748 billion and include ideas that garner broader support, including another round of Paycheck Protection Program funding for small businesses, unemployment benefits, and more money for vaccine distribution, testing and schools. Members of GOP leadership, while saying the bipartisan group has been helpful at finding common ground, argue that a final agreement will need to be hashed out by Senate Majority Leader Mitch McConnell (R-Ky.) and House Speaker Nancy Pelosi (D-Calif.). Democrats view state and local money as a top priority, and the Senate GOP leader has long called including protections against coronavirus lawsuits a "red line." Read more. 

In related news, ongoing revelations about how big businesses and chains were able to secure hundreds of millions of dollars in funding from the Paycheck Protection Program are shaping discussions in Congress about which employers should be eligible if another $300 billion is approved under another proposed stimulus package. Two leading senators on small-business issues, Marco Rubio (R-Fla.) and Ben Cardin (D-Md.), agree that a new round of funding should permit businesses to receive a second PPP payment. More funding would also likely require businesses to show that they’ve lost income due to the pandemic to receive loans, which turn into grants if used properly. Read more. 

Additionally, House Majority Leader Steny Hoyer (D-Md.), indicated yesterday that Democratic House leadership was open to accepting a COVID-19 relief deal with Senate Majority Leader Mitch McConnell (R-Ky.) that doesn't include aid to state and local governments, The Hill reported. "I mean, I think we need to get an agreement, and we need to get this bill passed," Hoyer told CNN's Abby Phillip during an interview on "Inside Politics." He added, "If we can get [state and local assistance], we want to get it, but we want to get aid out to the people who are really, really struggling and are at great risk." Read more. 

The attempt to draw up a pandemic relief package hit another roadblock yesterday as Senate Majority Leader Mitch McConnell’s top lieutenants said key portions of a compromise proposal from a bipartisan group of lawmakers aren’t likely to get backing from a majority of Republicans, Bloomberg News reported. Senator John Thune, the chamber’s No. 2 Republican, said the group of GOP and Democratic senators trying to forge a compromise likely cannot produce a solution to limiting the liability of employers in connection with COVID-19 infections that will satisfy Republicans. Democrats probably won’t like the result either, he added. The bipartisan group yesterday removed one of the last remaining hurdles to a complete stimulus framework when they agreed on a needs-based formula to distribute $160 billion in state and local aid, according to two congressional aides. But they are still haggling over the liability shield for employers that Republicans have demanded as part of the package. The group is discussing an enhanced pause in COVID-19 lawsuits, combined with a process for developing a future liability standard along with a standard that would apply now. Read more. 

In related news, a second round of Paycheck Protection Program (PPP) loans that lawmakers hope to include in the next COVID-19 relief package would expand eligibility and provide more flexibility for businesses, a top GOP lawmaker said yesterday, The Hill reported. Rep. Steve Chabot (R-Ohio), the ranking member on the House Small Business Committee, said that components of a $908 billion bipartisan coronavirus relief proposal circulated this week would accommodate businesses with very few employees, create new eligibility requirements for a second loan and simplify the loan forgiveness process. “We’re close to having a second round of PPP loans available, and there would be a set-aside there for microbusinesses, those that have 10 or fewer employees,” Chabot said. “A lot of them weren’t sophisticated enough to get in the first round. We want to make sure that those who didn’t get one in the first round or businesses who maybe did get one but really need a second loan, that they’re both eligible.” Read more. 

Ongoing revelations about how big businesses and chains were able to secure hundreds of millions of dollars in funding from the Paycheck Protection Program are shaping discussions in Congress about which employers should be eligible if another $300 billion is approved under another proposed stimulus package, the Washington Post reported. National chains received tens of millions of dollars more from the emergency small-business program than previously known. For example, more than 1,000 Sonic Drive-In restaurants received PPP funds, accumulating more than $100 million in all, according to a Washington Post analysis of recently released Small Business Administration data. This despite the fact that Sonic is backed by a private equity giant and performed well during the pandemic. Meanwhile, there is mounting evidence that other PPP recipients have had to lay off scores of workers due to the longer-than-expected pandemic and because recipients were not allowed to receive funds more than once. Employers that received PPP cut an estimated 900,000 jobs nationwide as a result of their loans expiring, according to a new analysis of data from Gusto, a payroll and benefits company. Read more. 

In related news, the dedicated congressional coronavirus oversight panel grilled Treasury Secretary Steven Mnuchin yesterday over a rescue loan issued to a shipping company through a program meant for businesses that are crucial to national security, The Hill reported. Members of the Congressional Oversight Commission (COC), created to oversee the implementation of the CARES Act, pressed Mnuchin during a hearing on why the Treasury and Defense departments deemed it necessary to lend $700 million to YRC Worldwide. The commission has been fiercely critical of Mnuchin and the Defense Department’s decision to issue the rescue loan, as well as with lending terms they fear are too generous to a company with longstanding financial issues. Members also questioned whether YRC is truly essential to national security and why the Pentagon has contracted YRC for a significant proportion of its shipping needs. Read more. 

Senate Majority Leader Mitch McConnell (R-Ky.) and House Speaker Nancy Pelosi (D-Calif.) have given no sign yet that they’re ready to directly engage in negotiations to sort through competing pandemic relief proposals — a step that many lawmakers say will be necessary to complete a deal this month, Bloomberg News reported. The Senate GOP leader is now on board with a $916 billion proposal released on Tuesday by Treasury Secretary Steven Mnuchin, while the House speaker sees a rival $908 billion plan still being drafted by a bipartisan group of lawmakers as the best path to a deal to aid the struggling U.S. economy. Their positioning shows consensus emerging on an overall price tag. But the proposals differ on key features. Although their proxies are engaged in negotiations, the top congressional leaders haven’t yet planned a meeting to resolve the outstanding issues. The biggest holdups for months have been a McConnell quest for a liability shield for employers facing coronavirus-related lawsuits that congressional Democrats don’t want, and a push by Pelosi for a substantial amount of state and local government aid that’s anathema to many Republicans in both chambers. Pelosi continues to say that the best chances for a deal are bipartisan Senate talks where a handful of rank and file Republican are open to just a pause in liability lawsuits instead of the changes McConnell wants. The Senate leader wants to defer to the separate White House’s offer, believing only President Donald Trump will likely sway most Republicans to back a trillion dollar aid package. Pelosi and McConnell, along with Senate Minority Leader Chuck Schumer and House Minority Leader Kevin McCarthy, must finally resolve this lingering dispute, according to legislators on both sides of the aisle.

Treasury Secretary Steven Mnuchin presented a new $916 billion COVID-19 relief proposal to House Speaker Nancy Pelosi, in the first move by the Trump administration since Election Day to break a months-long standoff, Bloomberg News reported. Pelosi and Senate Democratic leader Chuck Schumer called it progress, but said that it shouldn’t be used to obstruct the bipartisan negotiations already underway on a proposal from a group of Democratic and Republican lawmakers. The Mnuchin offer, which was made to Pelosi yesterday, was essentially a joint proposal from the White House, Senate Majority Leader Mitch McConnell (R-Ky.) and House Republican leader Kevin McCarthy (R-Calif.). Mnuchin said that he conferred with President Donald Trump, whose support will be needed to gather GOP votes. “This proposal includes money for state and local governments and robust liability protections for businesses, schools and universities,” Mnuchin said. Those issues have been the two key roadblocks in bipartisan talks on a $908 billion proposal put forth last week. “It’s a much better product” than the $908 billion option, McCarthy said. Pelosi and Schumer said in a joint statement that getting McConnell to go along with a $916 billion proposal was progress, but that the focal point should be the talks still going on in Congress on the bipartisan plan. They faulted the White House plan for leaving out enhanced unemployment benefits. Along with a widely supported renewal of aid for small businesses, the Mnuchin plan includes stimulus checks, something that members of both sides of the aisle have favored — including President-elect Joe Biden and Trump. There’s $600 per qualifying adult, with another $600 per child, according to McCarthy. Those checks would be in place of the $300 per week temporary supplementary unemployment benefits included in the bipartisan proposal. The proposal does extend two other expiring unemployment insurance programs — one for gig workers and the other for workers who have exhausted their 13 weeks of standard benefits.

With the coronavirus surging and colder weather limiting outdoor activities, the economy needs another round of fiscal policy support. Aid to small businesses should be part of any federal package, but it should be structured somewhat differently than the original Paycheck Protection Program, according to a commentary in today's Wall Street Journal. The economy added 245,000 jobs in November, and the unemployment rate fell to 6.7 percent. But the pace of job gains is notably slower than the 2.7 million net new jobs added in May and the 4.8 million added in June. Consumer spending is slowing, and consumer confidence is weakening. The household savings rate has plummeted since April, as consumers burn through savings. After a remarkable recovery this spring, a double-dip recession is in the cards. That recovery was aided by PPP, created as part of the Cares Act to provide forgivable loans — essentially grants to finance operating costs — to businesses with fewer than 500 employees, according to the commentary. Our research shows that PPP supported employment and increased financial health in the small-business sector. In addition, PPP supported labor demand and is reducing the length of the recovery by helping small businesses — the potential employers of any unemployed workers — to survive over the spring, summer and fall. Read more. (Subscription required.) 

*The views expressed in this commentary are from the author/publication cited, are meant for informative purposes only, and are not an official position of ABI.

In related news, the Senate Committee on Small Business and Entrepreneurship will hold a hearing tomorrow at 10 a.m. EDT titled "Small Business in Crisis: The 2020 Paycheck Protection Program and its Future." For a link to the live webcast and prepared witness testimony, please click here. 

Almost a week after Democratic congressional leaders climbed down from their demand for a multi-trillion dollar stimulus package, Senate Majority Leader Mitch McConnell (R-Ky.) continued to tout his own plan, endangering prospects for a compromise, Bloomberg News reported. McConnell’s top priority — federal limits on COVID-19 related lawsuits against businesses — has emerged as the key potential deal-breaker. Republicans have balked at the six-month moratorium proposed in a bipartisan stimulus package, saying it’s too limited, and talks have stalled. McConnell’s continued use of rhetoric that pre-dates the shift by House Speaker Nancy Pelosi and Senate Minority Leader Chuck Schumer on the overall dollar amount of aid underscored the risk of no further COVID-19 help by year-end. Senators from both sides of the aisle concluded that the prospects for a $908 billion compromise that Republican and Democratic negotiators are hashing out will come down to McConnell’s decision. Several GOP members have endorsed or been open to the plan, and top White House economic adviser Larry Kudlow said President Donald Trump would likely sign it. The Republican and Democratic negotiators continued to butt heads over aid for states and localities as well as the coronavirus liability protection for businesses. “Those are coupled together,” said GOP Senator John Cornyn of Texas, who couldn’t predict whether the relief package will be enacted. “There’s either going to be none for both of those, or both of those that are going to be provided for. My hope is we’ll do both.” Republicans have blasted state assistance as a bailout for mainly Democratic areas, while Democrats have refused to give employers a shield from lawsuits over poor protection against the spread of COVID-19. Time is running ever shorter on getting a deal, which Senator John Thune, the No. 2 Republican in that chamber, said yesterday would be attached to either a stopgap federal spending bill or omnibus appropriations legislation that funds the government into 2021. Read more. 

In related news, Congress will vote this week on a one-week stopgap funding bill to provide time for lawmakers to reach a deal in talks aimed at delivering COVID-19 relief and an overarching spending bill to avoid a government shutdown, Reuters reported. Lawmakers in the Republican-led Senate and Democratic-run House of Representatives need to enact a funding measure by Friday, when current funding for federal agencies is set to expire. House Speaker Nancy Pelosi and Senate Majority Leader Mitch McConnell hope to attach long-awaited COVID-19 relief to a broad $1.4 trillion spending bill. But with those negotiations yet to produce agreement, McConnell and House Majority Leader Steny Hoyer said separately yesterday that both chambers would vote this week on a measure to allow an additional week of talks. “I am disappointed that we have not yet reached agreement on government funding. The House will vote on Wednesday on a one-week CR to keep government open while negotiations continue,” House Majority Leader Steny Hoyer, the chamber’s No. 2 Democrat, said in a tweet. McConnell did not specify when the Senate would take up the measure. Read more.