Although the White House and congressional lawmakers were hoping to reach a deal as early as Monday to dedicate more money toward a stimulus loan program critical for at-risk education companies, among other businesses, congressional Republicans and Democrats were unable to settle on legislation to be considered by the Senate on Monday.
Senate Majority Leader Mitch McConnell, R-Ky., announced on the Senate floor Monday that no vote would take place, as Democrats continue negotiations with the Trump administration on specifics of any upcoming stimulus package.
“The Senate, regretfully, will not be able to pass more funding for Americans’ paychecks today,” McConnell said. “However, since this is so urgent, I’ve asked that the Senate meet again tomorrow in a new session that was not previously scheduled.”
Senate Minority Leader Chuck Schumer, D-N.Y., agreed to that request, a Schumer spokesperson confirmed.
President Donald Trump and Schumer, in separate media engagements yesterday, said that they hoped to reach a bipartisan agreement as early today to revive the Paycheck Protection Program, which ran out of money on Thursday.
According to a report by The Washington Post, Trump and congressional Democrats on Sunday were closing in on a deal that would provide about $310 billion to the Small Business Administration’s new payroll loan program established through the CARES Act, as well as $60 billion to SBA’s economic injury disaster relief program.
Speaking on CNN’s State of the Union Sunday, Schumer said he and House Speaker Nancy Pelosi, D-Calif., were having “constant discussions” with Treasury Secretary Steven Mnuchin, adding that he was hopeful an agreement would be reached soon.
“You’ve got a lot of details, a lot of dotted I’s and crossed T’s,” Schumer said, according to a transcript of his appearance on the program. “But I am very, very hopeful.”
In an April 18 letter circulated to Democrat House colleagues, Pelosi wrote that progress on another round of stimulus legislation was “encouraging.”
The CARES Act dedicated an initial $349 billion toward the paycheck loan program to help businesses with fewer than 500 employees maintain payroll levels, pay rent, and meet other financial needs.
Also appearing on State of the Union Sunday, Mnuchin said that despite some experts’ projections, he didn’t think the Paycheck Protection Program necessitated an additional $1 trillion to support small businesses negatively impacted by the COVID-19 crisis. “We think that another $300 billion—that’s what we’re talking about—should be sufficient to reach almost everybody,” Mnuchin said.
The maximum loan under the program is $10 million, and the SBA said it will forgive the portion of the loan used for payroll costs and other designated operating expenses for up to eight weeks, as long as at least 75 percent of loan funds are used toward payroll. Other expenses qualifying for forgiveness include mortgage interest and utilities.
The two weeks since the launch of the paycheck program on April 3, saw a flood of applications at banks administering the program, which tapped out the funding account.
A few education companies have already been approved for funding, though many are still waiting.
Some of the 60 total firms funded by education venture capital firm Rethink Education applied for the paycheck program after it launched.
One of those companies has received approval, but the rest of the companies that applied were waiting on a decision as of Friday, said Michelle Dervan, a partner at Rethink.
Approval was also granted on Thursday to Speak Agent, a Rockville, Maryland-based startup that provides a digital platform for accelerating the learning of math, reading, and science through specialized language development.
“I’m very happy about it, but the process is a little opaque, I think, because [the SBA and participating banks] didn’t have time to put the systems in place that would integrate it with their normal lending process,” Speak Agent CEO Ben Grimley said.