Senate adjourns with no deal on small-business loan program

A fight over hundreds of billions in small-business funding will carry into next week after the Senate adjourned for the week on Thursday without an agreement. 

The Senate held a brief pro forma session on Thursday — which are constitutionally mandated absent a larger adjournment agreement.

But Senate Majority Leader Mitch McConnellAddison (Mitch) Mitchell McConnellPence: Next coronavirus relief bill would need legal shield for businesses GOP faces internal conflicts on fifth coronavirus bill State Department scrutiny threatens Pompeo's political ambitions MORE (R-Ky.) did not try for a second time to pass a new $250 billion for the small-business program — a request that would have been blocked by Democrats absent a deal on the funding package, which has not yet been reached.

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“This morning, the program ran out of money and shut down, just as we’d warned. But even now, Senate Democrats are still blocking funding. Every Senate Republican was ready to act today, but Democrats would not let us reopen the program,” McConnell said on the floor, referring to the Paycheck Protection Program (PPP). 

“It is surreal to see Democratic leaders treat support for workers and small businesses as something they need to be goaded into supporting. This should be above politics,” McConnell added. “I hope our colleagues come around soon.” 

The standoff comes a week after both sides tried for the first time to pass their competing versions of the bill, which is viewed as an “interim” step between last month’s massive $2.2 trillion stimulus and a fourth coronavirus bill expected to be passed in the coming months. 

Republicans want to pass a stand-alone bill that would include $250 billion in additional money for the Paycheck Protection Program. Democrats want to add in $100 billion for hospitals, $150 billion for states and a boost in food assistance funding. 

The inaction on Thursday afternoon comes after the Small Business Administration (SBA) announced that it had burned through the initial $349 billion allocated by Congress and could no longer accept new loans under the PPP, which provides grants and loans to businesses with fewer than 500 employees. That leaves businesses that still need aid, or who have not yet gotten their loan approved, in a lurch until Congress is able to clear new funding. 

"The SBA is currently unable to accept new applications for the Paycheck Protection Program based on available appropriations funding. Similarly, we are unable to enroll new PPP lenders at this time," the SBA said in a statement Thursday morning.

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The impasse will last until at least Monday, when the Senate is next expected to convene for another pro forma session. 

But McConnell and congressional GOP leadership have shown no signs of backing down from their preference for a “clean” bill that would only include the small-business funds. 

“The cost of continued Democratic obstruction will be pink slips and shuttered businesses. We hope Democrats see reason soon and finally heed Republicans’ repeated calls for a funding bill that can quickly earn unanimous consent from all 100 senators and become law,” McConnell said in a joint statement on Wednesday night with House Minority Leader Kevin McCarthyKevin Owen McCarthyTrump, GOP go all-in on anti-China strategy The Hill's Morning Report - Presented by Facebook - Mnuchin: More COVID-19 congressional action ahead GOP pulls support from California House candidate over 'unacceptable' social media posts MORE (R-Calif.). 

Trump knocked Democrats in a tweet shortly before the Senate session saying they are “blocking additional funding for the popular Paycheck Protection Program.” 

“They are killing American small businesses. Stop playing politics Dems! Support Refilling PPP NOW – it is out of funds!” he said. 

But Trump told senators during a conference call on Thursday morning that he could support a deal that included additional money beyond the PPP. 

"I would hope, as he said on that call, that Democrats and Republicans can work together to find a solution here. And that may involve something in addition to just advancing the paycheck protection plan, but that's the plan that's out of money," Sen. Roy BluntRoy Dean BluntGOP faces internal conflicts on fifth coronavirus bill Senators weigh traveling amid coronavirus ahead of Memorial Day GOP senators: More relief needed now MORE (R-Mo.) told reporters. 

Asked if Trump specifically said on the conference call that he was open to additional funds not related to the small-business funding, Blunt said "yes."

"Apparently the president is open to discussing another topic or two," he added. 

Democrats argue hospitals are overwhelmed and states are facing steep budget cuts due to the coronavirus, putting an onus on passing new funding now. Democrats also wanted to reform the PPP to ensure that part of the $250 billion in new funds would go toward smaller lenders. 

"We don't want it to perpetuate the disparity of access to credit for some of our businesses," House Speaker Nancy PelosiNancy PelosiTrump retweets personal attacks on Clinton, Pelosi, Abrams Biden swipes at Trump: 'Presidency is about a lot more than tweeting from your golf cart' Federal aid to state and local governments should rely on real numbers MORE (D-Calif.) told reporters on a conference call. 

The Speaker also argued the importance of including additional funds for hospitals, community health centers and state and local governments on the front lines of the coronavirus fight. It makes little sense to help small businesses, Pelosi suggested, without also protecting the health of the communities where those businesses operate. 

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"It's not that we don't share the value of small business; we do. We have been their champion. ... [They are] the lifeblood of America's economy. But in order for them to succeed, people have to be well, people need to be safe. And we need to have the state and local [funding]," Pelosi said. 

Still, there were signs of breaks among Democrats ahead of Thursday’s Senate session. 

Sen. Kyrsten Sinema (D-Ariz.) called for the Senate to pass new PPP funding by unanimous consent. 

"The PPP program is going to run out of funding soon — the Senate should approve add’l funding by unanimous consent ASAP. Small businesses need our help to survive during this emergency," Sinema tweeted Thursday. 

The stalemate over the small-business funding comes as Senate Minority Leader Charles SchumerCharles (Chuck) Ellis SchumerTrump slams Sessions: 'You had no courage & ruined many lives' Senate Democrats call on Trump administration to let Planned Parenthood centers keep PPP loans States, companies set up their own COVID-19 legal shields MORE (D-N.Y.) and Treasury Secretary Steven MnuchinSteven Terner MnuchinFive questions about the next COVID-19 relief package Senate Republicans call on DOJ to investigate Planned Parenthood loans The Hill's Coronavirus Report: Surgeon General stresses need to invest much more in public health infrastructure, during and after COVID-19; Fauci hopeful vaccine could be deployed in December MORE have been negotiating for days to try to cut a deal. 

Schumer told reporters on Wednesday that there was “no reason” a deal couldn’t be reached. But that deal has remained elusive. Negotiations are continuing Thursday. 

“The next meeting will be this afternoon,” Pelosi told reporters during the conference call. “We're hopeful they will come back with something that strikes a balance with what we know we need to do."

Mike Lillis contributed.