Negotiations this week between congressional lawmakers and the White House on a fourth comprehensive coronavirus relief package continued through this afternoon, as significant policy and funding differences remain between Democrats and Republicans. (POLITICO Playbook PM, August 7)
- The GOP’s $1 trillion package released July 27 contrasts with the $3.4 trillion proposal House Democrats passed in May. (Brownstein Hyatt Farber Schreck, July 31 – “HEALS Act Comparison to HEROES Act and Current Law,” and CNet, August 5 – “HEALS vs. CARES vs. Heroes stimulus packages: Key differences between Democratic and Republican proposals”)
- President Donald Trump tweeted yesterday that if a deal cannot be made soon, he would sign executive orders extending the CARES Act’s residential tenant eviction moratorium and some enhanced unemployment benefits, while also establishing a payroll tax cut. Unilateral executive action on these matters, however, would likely result in legal challenges. (Bloomberg, August 6)
- Senate Minority Leader Chuck Schumer (D-NY) commented on the negotiations with Treasury Secretary Steven Mnuchin, White House Chief of Staff Mark Meadows and House Speaker Nancy Pelosi (D-CA). “We’re still slogging through step by step by step. They made some concessions, which we appreciated. We made some concessions, which they appreciated. We’re still far away on a lot of the important issues, but we’re continuing to go at it,” Schumer said. (Wall Street Journal, August 4)
- The House of Representatives is out of session next week but members have been notified they will be called back if a deal is reached. In the Senate, Majority Leader Mitch McConnell (R-KY) announced yesterday that he will allow senators to leave Washington until an agreement is reached. (The Hill, August 6)
- “Exactly when that deal comes together I couldn’t tell you, but I think it will at some point in the near future,” McConnell said yesterday on “Squawk on the Street,” which also featured an interview with Pelosi. (CNBC interviews, August 6)
Paycheck Protection Program (PPP) Loans
The PPP is set to expire on August 9. It has provided over five million loans and more than $521 billion since April to help small businesses meet expenses for payroll, benefits, rent, and other obligations. (Small Business Administration statistics through July 31).
- Senate Small Business Chair Marco Rubio (R-FL) has unveiled two amendments for the next coronavirus relief package to extend the PPP. (Politico Pro, August 5)
- Sens. Rubio and Susan Collins (R-ME) on July 27 introduced the “Continuing Small Business Recovery and Paycheck Protection Program (CSBRPPP) Act” that would fund PPP “second draw” loans, establish a new loan program for “Recovery Sector Businesses,” and make other PPP reforms. (Section-by-section summary and one-pager.)
- Businesses with 300 or fewer workers, that can also show a 50 percent quarterly revenue loss compared to last year, could qualify for a second round of PPP loans under the Rubio-Collins proposal.
- The Real Estate Roundtable joined 120 business groups (including the International Franchise Association (IFA), U.S. Chamber of Commerce, and U.S. Travel Association) in an August 5 letter urging Congress to expand “second draw” PPP loan eligibility beyond the scope of the Rubio-Collins bill. (IFA press release, Aug. 5)
- The coalition’s August 5 letter stresses that “the 50 percent decline as proposed in the CSBRPPP Act is simply too high.” A revenue decline of 20 percent or greater for small businesses could mean the difference between staying open or closing, according to the letter.
- Meanwhile, CEOs of major retail, hospitality, and technology companies separately urged Congress in an August 3 letter to enable more businesses to qualify for government-backed loans beyond the current PPP. (Politico, August 3)
- The CEOs expressed support for the “Reviving the Economy Sustainably Towards a Recovery in Twenty-twenty (RESTART) Act” (S. 3814), introduced by Senators Michael Bennet (D-CO) and Todd Young (R-IN). The measure currently has 52 bipartisan Senate cosponsors. It would allow businesses with up to 5,000 employees to qualify for federally-backed, forgivable loans if they sustained a 25 percent revenue loss in 2020 (with reference to a comparable 2019 quarter). (Press release, May 21).
- The Roundtable supports S. 3814 to help small and mid-sized businesses meet up to six months of payroll, rent, and other obligations during the pandemic. RESTART loans would be repaid up to seven years, with loan forgiveness amounts calculated based on the business’s employee size and extent of revenue loss. (RESTART Act summary)
- Sen. Bennet commented on Sen. Rubio’s PPP proposal, “We’ve got to expand the ambition of the program. $100 billion of loans is a great start, but it’s not going to meet the large portion of the need. The amount is substantially greater than that.” (Politico, August 3)
The ongoing efforts of policymakers to provide COVID-19 economic relief was a focus of a discussion last week featuring Real Estate Roundtable President and CEO Jeffrey DeBoer and other real estate industry trade group leaders in a Walker & Dunlop webinar “All Eyes On Washington: What will the next stimulus bill do for CRE?”— moderated by Roundtable member and W&D Chairman and Chief Executive Officer Willy Walker. (Roundtable Weekly, July 31)
# # #