WASHINGTON (AP) — A widely supported bill to refine a payroll subsidy program for businesses struggling during the COVID-19 pandemic could soon be on its way to getting signed into law by President Donald Trump despite hitting a speed bump in the Senate on Wednesday.
The legislation would give business owners more flexibility to use taxpayer subsidies for other costs and extend the lifespan of the program as the economy continues to struggle through record joblessness and a deep recession.
It passed the House overwhelmingly last week on a 417-1 vote, but an attempt by top Senate Democrat Chuck Schumer of New York to fast-track the bill through the Senate failed after Sen. Ron Johnson, R-Wis., objected.
The legislation to modify the Payroll Protection Program, a central pillar of two costly coronavirus rescue laws, has strong momentum, and Johnson and other GOP senators who don’t like the bill appear over-matched.
The legislation would lower an original requirement that at least 75% of PPP money be used on payroll costs, reducing that threshold to 60% of the loan. It would also lengthen the period in which PPP money must be used — and still permit businesses to have their loans forgiven — from eight week to 24 weeks.
Critics say the pending measure does nothing to ensure that businesses that don’t necessarily need PPP subsidies are ineligible, among other problems.
“If we’re going to potentially authorize more spending, that program needs to be reformed,” Johnson told reporters. “My main problem with what the House did — and this is what’s in dispute — it basically reauthorized the program through Dec. 31, setting up a massive new infusion into the program without the reforms I think really need to be placed so that people who don’t need it don’t keep getting it. We don’t have an unlimited checkbook.”
Senate Majority Leader Mitch McConnell, R-Ky., supports the measure, as do most Republicans and Senate Democrats. McConnell employed an inside-the-Senate maneuver to test whether the bill could pass unanimously or at least without having to go through a cumbersome floor debate. But several Republicans, including Johnson, registered objections.
Schumer said it is urgent that the measure pass immediately.
“We can’t afford to wait. Our small businesses can’t afford to wait,” Schumer said. “These changes are universally agreed to as good ones, and we shouldn’t let someone who wants a small change say, ‘Let’s stop it.’”
Johnson said Republicans are instead hoping to get top lawmakers to sign onto a nonbinding letter seeking to clarify some of the rules governing the program. He did not explain exactly what he’s seeking but said Republican lawmakers are close to agreement on the language of the proposed letter.
“We’re so close. We’re first working on our side. Then we’ll consult you (Democrats),” Johnson said. “Maybe we pass this tonight or early tomorrow morning.”
If Johnson continues to object, McConnell might have to burn floor time to debate the measure for several days.
Schumer suggested that Johnson and other Republicans try to fix any problems when Congress passes another COVID-19 relief bill.