Following the bi-partisan passage of the monumental CARES Act, the month of April began with a bang. What started with talk of a sweeping infrastructure package as “phase 4 stimulus,” that would potentially spotlight many BDA priorities such as the reinstatement of advance refundings, and increase the BQ debt limit, has quickly turned into partisan squabble.
Congress has announced an extension to their recess through at least May 4th. While this does not fully negate all hope for immediate action, it just requires votes on legislation that can pass by voice vote, or unanimous concent that would not require the full House or Senate to return to Washington.
Senate Stalls on Small Business Assistance/Program Runs Fully Dry
As programs such as the Paycheck Protection Program (PPP) have quickly gone through appropriated funds, the Senate took center stage promising a vote on an “interim stimulus package” to increase funding to the program by unanimous consent. This effort was promptly sidetracked by Democratic leadership, following Speaker Pelosi’s(D-CA) lead for a much broader interim package.
Both Senate Finance and Banking Committees remain adamantly focused on refunding the PPP program. Beyond the calls to refund the program, Banking Chairman Crapo(R-ID), working alongside Ranking Member Brown(D-OH) continued to press both the Fed and Treasury for quick and detailed guidance on Title IV of the CARES Act that provides relief to state and local governments and authority to assist the municipal market.
Throughout the COVID-19 crisis, the President and administration have increasingly leaned on Senate Republican leadership for guidance. This Week, Finance Chairman Chuck Grassley(R-IA) was named to the Presidential task force to re-open the economy, a strong indicator legislative priorities will flow through the Committee for the remainder of the legislative year.
House Mulls Broader Interim Package
While Leaders McConnell(R-KY) and Schumer(D-NY) continue to banter on the Senate side, Speaker Pelosi(D-CA) looks to change the narrative and introduced measures that would not only send funds to the PPP, but also additional direct funding to state and local governments and hospitals in need.
The House Financial Services Committee is currently helping to drive the agenda on the House side. Along with pressing for continued efforts to streamline the small business lending program, and a recent push to create a backstop for mortgage lenders,Chairwoman Waters(D-CA) has advocated for the suspension of all rulemaking not related to COVID-19.
In aletter signed by all Members of the HFSC Majority, the Chairwoman states, “At a time when regulators should be working together to appropriately respond to this growing pandemic and keep our banking system safe and sound, unrelated rulemaking should be put on hold for the time being.”
While House Ways and Means remains focused on an interim stimulus package, Chairman Richard Neal(D-MA) is not taking his eye off the bigger picture.
In a recent interview, Chairman Neal expressed the need a broad “stimulus 4” that includes infrastructure spending. The Chairman said, that infrastructure is our biggest need and that he plans to press the President to follow through on his $2 trillion dollar infrastructure pledge. In his January outline, the Chairman expressed the need to include many infrastructure bond provisions including advance refundings and raising the BQ debt limit.
At this time there seems to be no work towards compromise, however the BDA expects the White House to signal support for some additional funding beyond what was included in the initial Senate package in an effort to expedite passage and refill the PPP’s coffers.
If this months struggles are a guide to the next steps here in DC, the BDA’s expectations for another comprehensive stimulus package, possibly including infrastructure measures, have shrunk exponentially.