The Latest

While House Democrats – who passed a $3 trillion Phase 4 coronavirus response package earlier this month – and the White House and Senate Republicans remain at an impasse on moving ahead with the next phase of comprehensive relief, there has been movement towards making bipartisan, tailored reforms to the Paycheck Protection Program (PPP). Before leaving Washington for Memorial Day, Senate Majority Leader McConnell (R-KY) committed to hold a vote after the recess on a bipartisan bill to extend the current eight-week period businesses have to use PPP loans to pay employees and other expenses for the loan to be forgiven to 16 weeks. The bill would also allow businesses to use PPP loans to purchase personal protective equipment (PPE) for employees and to install or expand protections like drive-thru windows.

Today, the House voted 417-1 to pass the bipartisan Paycheck Protection Program Flexibility Act, which would reform the Paycheck Protection Program (PPP) to allow forgiveness for expenses beyond the current eight week covered period to 24 weeks. A similar bill that the Senate is expected to vote on next week would extend the covered period to 16 weeks. The House also voted 269-147 in favor of the Small Business Transparency and Reporting for the Underbanked and Taxpayers at Home (TRUTH) Act, which would direct the SBA to explain and justify all disbursements of coronavirus relief funds, but it failed to secure the two-thirds supermajority necessary to pass under suspension of the rules. The House Education and Labor Subcommittee on Workforce Protections also held a rescheduled hearing this morning on “Examining the Federal Government’s Actions to Protect Workers form COVID-19.”

This week’s House votes marked the first time in the chamber’s history that Members have voted remotely. Over 70 Members, all Democrats, submitted letters to the Clerk authorizing their proxies. Earlier in the week, House Minority Leader McCarthy (R-CA) and other Republicans filed a lawsuit challenging the constitutionality of new House rules allowing for remote voting by proxy. In response, Speaker Pelosi (D-CA) said in a statement that the rules are “fully consistent with the Constitution” and “supported by expert legal analyses.”

While Congress considers PPP reforms, the Treasury Department updated FAQs on the program and published an interim final rule on loan forgiveness and an interim final rule on loan review procedures and related borrower responsibilities. The SBA also updated its report on PPP Round 2 approvals through May 23 and its summary of Round 2 data.

The Administration, through the Department of Health and Human Services (HHS), delivered to Congress a congressionally mandated report on its national COVID-19 testing strategy. As anticipated, the report drew criticism from Democratic leaders.

Elsewhere, the President and federal agencies continue to take other steps to respond to the outbreak, including, but not limited to:

  • President Trump signed a Proclamation honoring the victims of the coronavirus pandemic and a Proclamation restricting most non-US citizens from entering the country if they have been in Brazil in the past 14 days.
  • Vice President Pence met with governors and the White House Coronavirus Task Force to discuss the COVID-19 response and reopening efforts, including efforts to maximize testing and outbreak modeling.
  • National Economic Council Director Larry Kudlow said the Administration may support “back to work” bonus payments in Phase 4 coronavirus response legislation, specifically citing a proposal by Senator Portman (R-OH) that would temporarily provide unemployed workers with an extra $450 per week upon returning to work.
  • HHS announced $500 million in payments from the Provider Relief Fund to the Indian Health Service (IHS) and tribal hospitals, clinics, and urban health centers to support the tribal response to COVID-19.
  • The Centers for Disease Control and Prevention (CDC) issued interim guidelines for COVID-19 antibody testing in clinical and public health settings.
  • Federal Communications Commission (FCC) Chairman Pai and Cybersecurity and Infrastructure Security Agency (CISA) Director Krebs wrote letters to governors and Washington, DC Mayor Bowser urging them to recognize certain communications infrastructure entities and workers as essential to COVID-19 response efforts.

A complete overview of both congressional and Administrative response efforts is available here and updated daily.

What’s Next

Just before Memorial Day, Leaders McConnell and McCarthy met with President Trump, Treasury Secretary Mnuchin, and White House Chief of Staff Meadows to discuss Phase 4 legislation. McConnell reiterated, and all agreed, that the bill must include liability protections. Senator Grassley (R-IA) later said that Senate negotiations will not start until the third or fourth week of June. Senator Blunt (R-MO) added that passing a bill by the July recess would be a challenge, but it should be passed before the August recess.

Tomorrow, the House Transportation and Infrastructure Subcommittee on Coast Guard and Maritime Transportation will hold a virtual hearing on “The Status of the US Maritime Supply Chain During the COVID-19 Pandemic” and the House Oversight and Reform Subcommittee on National Security will hold a briefing with the Department of Justice (DOJ), Federal Bureau of Investigation (FBI), and CISA on cyberthreats related to the global coronavirus response.

Next Tuesday the Senate Banking Committee will hold a remote hearing on “Implementation of Title IV of the CARES Act,” while the Senate Finance Committee will hold a hearing on “COVID-19 and Beyond: Oversight of the FDA’s Foreign Drug Manufacturing Inspection Process” and the Senate Judiciary Committee will hold a hearing on “Examining Best Practices for Incarceration and Detention During COVID-19.” On the other side of the Capitol, the House Energy and Commerce Subcommittee on Oversight and Investigations will hold a remote hearing entitled “On the Front Lines: How Governors are Battling the COVID-19 Pandemic.”

On Wednesday, the Senate Small Business Committee will hold a hearing on “Perspectives from Main Street: COVID-19’s Impact on Small Businesses and the Senate Commerce Committee will hold a hearing on “The State of Transportation and Critical Infrastructure: Examining the Impact of the COVID-19 Pandemic.” The House Budget Committee will hold a virtual hearing on “Addressing the Economic Impacts of COVID-19: Views From Two Former CBO Directors.” The House Judiciary Committee will examine “Protecting the Right to Vote During the COVID-19 Pandemic” and the House Financial Services Subcommittee on Consumer Protection and Financial Institutions will hold a hearing on “Promoting Inclusive Lending During the Pandemic.” The Senate Health, Labor, Educations, and Pensions (HELP) Committee will also hold a hearing next Thursday on “COVID-19: Going Back to College Safely” and the Senate Environment and Public Works Committee will have a hearing on “Infrastructure: The Road to Recovery.”

On June 9, the Senate Homeland Security and Governmental Affairs Committee will have a hearing on “Evaluating the Federal Government’s Procurement and Distribution Strategies in Response to the COVID-19 Pandemic.” On June 10, Treasury Secretary Mnuchin and SBA Administrator Carranza will testify before the Senate Small Business Committee during a hearing on “Implementation of Title I Of the CARES Act” and the HELP Committee will hold a hearing on “COVID-19: Going Back to School Safely.”

Relevant Resources

Read more in McGuireWoods Consulting’s Emerging Technologies Washington Update.