Senate Democrats unveil $500 billion short-term coronavirus relief plan
Senate Democrats on Thursday unveiled the details of a $500 billion coronavirus relief plan they will offer later in the morning when Senate Majority Leader Mitch McConnell (R-Ky.) requests unanimous consent to provide an additional $250 billion to the popular Paycheck Protection Program.
Democrats, led by Senate Minority Leader Charles Schumer (N.Y.), have proposed $250 billion for the small business loan program, under which employers receive federally backed loans that are 100 percent forgivable if they maintain their payrolls. But half of the amount, $125 billion, is set aside for small banks and credit unions to help better serve woman-, minority-, and veteran-owned businesses.
Sens. Ben Cardin (Md.), the ranking Democrat on the Senate Small Business Committee, and Chris Van Hollen (D-Md.) are expected to offer the plan after they object to McConnell’s request for a straight $250 billion infusion to the Paycheck Protection Program.
Forty-five billion dollars are set aside for small community-based lenders, such as minority depository institutions and microlenders with less than $10 billion in consolidated assets. Fifteen billion dollars are set aside for community banks and credit unions with less than $10 billion in consolidated assets.
Fifty billion dollars would go to the Small Business Administration’s (SBA) Economic Injury Disaster Loan program to support up to $300 billion in direct lending, and $15 billion would go to the SBA’s Emergency Economic Disaster Grant Program.
The Democrats have also proposed reforms to the small-business lending program to expedite loans, echoing suggestions by some Republicans such as Sen. Pat Toomey (Pa.) for streamlining the program.
The Democrats are calling for banks of all sizes to gather documents that comport with federal know-your-customer regulations during the loan-application stage, which would clear up confusion over what documents lenders need to obtain before giving out federally backed loans.
The Democratic plan calls for $100 billion in new funding for hospitals and other health care providers and requires the Trump administration to report to Congress its COVID-19 testing strategy. The Department of Health and Human Services and other agencies would be required to report to Congress every 30 days about the allocation of testing and supplies around the country.
The third prong of the Democratic plan is an additional $150 billion in fiscal relief to state, local and tribal governments.
Sixty-five billion dollars would be allocated to states based on population, with small states getting a minimum of $500 million.
Fifty-three billion would be allocated to local governments based on the Community Development Block Grant formula and $20 billion would go to states based on their national share of coronavirus infections, a provision that would help Schumer’s hard-hit home state of New York.
The plan would also set aside $8 billion in funding for Native American tribes and $3 billion for territories.