By James Q. Lynch and Graham Ambrose, Gazette-Lee Des Moines Bureau
Congress will have to put more money into the Paycheck Protection Program, which already has committed $349 billion to help small businesses keep their employees on the payroll, Iowa’s Republican Sens. Chuck Grassley and Joni Ernst said Thursday.
The Small Business Administration says it has approved more than 1.6 million loans worth more than $339 billion.
The program was expecting to run out of money Thursday, making it the first of those included in the $2.2 trillion stimulus bill — the Coronavirus Aid, Relief, and Economic Security (CARES) Act — to run out of funds.
“I think everybody was surprised” at how quickly the money was distributed, Grassley said.
“I’m sure that everybody thought, ‘$350 billion, heck, that’s a lot of money.’ So we were surprised. The first week, we knew it wasn’t going to be enough,” he said.
Both Grassley and Ernst support adding another $250 billion to the program, which offers forgivable loans to businesses that keep their employees on the payroll.
That effort took on added importance, Grassley said, with the announcement that another 5.2 million people filed for unemployment benefits over the past week.
“So we’re going to need more money,” Grassley said during his weekly conference call with reporters.
In addition to the Paycheck Protection Program, Grassley expects Congress will need to appropriate more funds for state and local governments that have seen their sales tax and income tax revenues plummet because of the government-imposed shutdowns.
Hospitals also will need more funds at some point, he said.
Ernst, noting the mounting financial pressures facing health care providers, is proposing county-owned hospitals be made eligible to receive the relief provided in the Paycheck Protection Program, just like small businesses.
“This will allow them to keep their staff on payroll and continue to serve our communities,” Ernst said.
Both of the Republican senators are frustrated that Democrats have blocked Senate Majority Leader Mitch McConnell’s attempt to add the $250 billion through the Senate via the unanimous consent process. Unless Democrats consent, boosting the funds available will have to wait until the Senate reconvenes May 4.
“This could have been avoided,” Ernst said. “Unfortunately, politics got in the way.”
Ernst said the failed Republican push for $250 billion was “a simple measure that would have bolstered the program — no political gimmicks, just a simple ask to put more money in this program.”
Democrats are insisting the bill also include $100 billion for hospitals, $150 billion for states and a boost in food assistance funding.
Grassley called Democrats’ refusal to go along with the $250 billion infusion of funds “illegitimate” and said it will be hard for them to defend those actions.
“We know there is a need for $250 billion and it could be appropriated in two minutes in the Senate and two minutes in the House if there wasn’t any objection,” Grassley said. “The path forward is not very clear at this point.”
Ernst sounded more optimistic.
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“We’ll go back to the drawing board,” she said. “More of our Democratic colleagues are feeling the pressure to get this done as well. So I think we’ve got a little bit of a bipartisan movement going here to get the PPP refunded as quickly as possible.”
Also Thursday, it was announced that both Grassley, chairman of the Senate Finance Committee and Senate president pro tempore, and Ernst were named to the bipartisan task force focused on safely reopening America following the public health crisis. The task force includes Democratic and Republican members of both the Senate and House.
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