Stimulus Funding Discussions Fuel Debate as 116th Congress Winds Down

Various proposals on Capitol Hill toggle between improved Paycheck Protection Program funding and loan forgiveness ACA International has advocated for.

12/3/2020 9:30 AM

AdvocacyNewsCOVID-19
Stimulus Funding Discussions Fuel Debate as 116th Congress Winds Down

Congress revisited discussions on Coronavirus Aid, Relief, and Economic Security (CARES) Act funding this week as the lame-duck session winds down and finalizing financial relief for consumers and businesses remains at the center of bipartisan debate.

While U.S. Department of the Treasury Secretary Steven Mnuchin and Chairman of the Board of Governors of the Federal Reserve System Jerome Powell testified on the CARES Act before Senate and House committees, lawmakers introduced a bipartisan aid proposal of about $908 billion in an attempt to reach an agreement on providing federal relief to consumers and businesses.

Leaders especially focused on reallocating money in the U.S. Small Business Administration Paycheck Protection Program (PPP), established under the CARES Act, while simplifying the loan forgiveness process for businesses that already used the funds.

According to The Washington Post, the bipartisan proposal does include approximately $288 billion in funding for small businesses through the PPP and other aid.

Senate Majority Leader Mitch McConnell, R-Ky., said Tuesday it’s likely additional COVID-19 relief funding would be added to the omnibus spending package for the federal government, according to The Hill.

During the Senate Committee on Banking, Housing and Urban Affairs hearing with Mnuchin and Powell Tuesday, U.S. Sen. Tim Scott, R-S.C., said the PPP has funds available that could have a significant impact for struggling businesses and that he supports simplifying PPP loan forgiveness.

The bipartisan group proposed the $908 billion in funding before programs under the CARES Act, like eviction moratoriums and unemployment insurance, expire at the end of 2020.

The group includes U.S. Sens. Mitt Romney, R-Utah; Rob Portman, R-Ohio; Susan Collins, R-Maine; Chris Coons, D-Del.; Joe Manchin D-W.Va.; Mark Warner, D-Va.; Michael Bennet, D-Colo.; and Dick Durbin, D-Ill.

Participants in the Senate committee hearing expressed notable support for additional financial relief this year, while agreement on the level of funding appears to remain out of reach.

The bipartisan proposal would extend the federal unemployment benefits at $300 a week for approximately four months and provide funding for state and local governments, small businesses, health care and student loans, according to The Washington Post.

House Speaker Nancy Pelosi, D-Calif., and Senate Minority Leader Charles Schumer, D-N.Y., reportedly issued a proposal for additional relief, but kept details private, according to the article. Senate Republicans also released a narrower plan for relief Tuesday, including more aid for small businesses and short-term unemployment aid, but no dollars for state and local governments. The Washington Post reports this plan would be opposed by Democrats.

Meanwhile, the House Financial Services Committee also held a hearing with Mnuchin and Powell this week on oversight of their response to the pandemic.

In his testimony and throughout the hearing, Mnuchin urged Congress to pass legislation to allocate unused CARES Act funds for PPP relief—where grants, rather than loans, will be the most effective tool to delivering small-business relief.

U.S. Rep. Andy Barr, R-Ky., raised concerns about the cumbersome PPP loan forgiveness process, adding that community banks will be disincentivized from participation going forward is the rules of the road remain unclear and burdensome. Mnuchin reiterated that Treasury has taken all steps within its available authority to simplify the forgiveness forms, but congressional action would be needed to institute a threshold for forgiveness. Mnuchin said he would support a loan forgiveness threshold of $150,000.

The committee also discussed an updated version of the Health and Economic Recovery Omnibus Emergency Solutions (HEROES) Act, H.R. 925, that would expand some of the lending programs for small businesses and support for frontline workers, schools, individuals and families. It was passed in the House in October.

Committee Chairwoman U.S. Rep. Maxine Waters, D-Calif., also has proposed the “Faster Stimulus Payments and Fed Accounts Act” that would provide monthly direct payments to individuals and families until the economy recovers, according to the hearing memorandum.

Democrats in the U.S. House of Representatives approved the $2.2 trillion relief package and updated version of the Health and Economic Recovery Omnibus Emergency Solutions (HEROES) ACT, 214-207, along party lines, ACA International previously reported.

The updated HEROES Act includes components of the original bill that would have a significant impact on the accounts receivable management (ARM) industry related to credit reporting and some restrictions on debt collection during a national emergency, when collectors can actually help consumers more through hardship programs.

ACA also continues advocacy on the PPP, including seeking support from members of Congress to improve the program’s loan forgiveness process and pass legislation clarifying that expenses related to those loans are tax deductible.   

As part of that advocacy, ACA joined industry trade groups representing the accounts receivable management industry, banks, credit unions, financial institutions, nonprofits and businesses of all sizes, in a letter to members of Congress in support of legislation to reform the PPP, ACA previously reported.


Follow ACA International on Twitter @ACAIntl and @acacollector, Facebook and request to join our LinkedIn group for news and event updates. ACA International members are welcome to submit news items for possible publication to comm@acainternational.org. Visit our publications page for news submission guidelines and subscriptions to ACA Daily, Collector magazine and Pulse.

Advertising is available for companies wishing to promote their products or services. Be sure to visit the ACA Events Calendar on the Education and Training page to view our listing of upcoming CORE Curriculum and Hot Topic seminars featuring critical educational opportunities for your company.


Subscribe to ACA Daily NEWSROOM

Stimulus Funding Discussions Fuel Debate as 116th Congress Winds Down

Congress revisited discussions on Coronavirus Aid, Relief, and Economic Security (CARES) Act funding this week as the lame-duck session winds down and finalizing financial relief for consumers and businesses remains at the center of bipartisan debate.

While U.S. Department of the Treasury Secretary Steven Mnuchin and Chairman of the Board of Governors of the Federal Reserve System Jerome Powell testified on the CARES Act before Senate and House committees, lawmakers introduced a bipartisan aid proposal of about $908 billion in an attempt to reach an agreement on providing federal relief to consumers and businesses.

Leaders especially focused on reallocating money in the U.S. Small Business Administration Paycheck Protection Program (PPP), established under the CARES Act, while simplifying the loan forgiveness process for businesses that already used the funds.

According to The Washington Post, the bipartisan proposal does include approximately $288 billion in funding for small businesses through the PPP and other aid.

Senate Majority Leader Mitch McConnell, R-Ky., said Tuesday it’s likely additional COVID-19 relief funding would be added to the omnibus spending package for the federal government, according to The Hill.

During the Senate Committee on Banking, Housing and Urban Affairs hearing with Mnuchin and Powell Tuesday, U.S. Sen. Tim Scott, R-S.C., said the PPP has funds available that could have a significant impact for struggling businesses and that he supports simplifying PPP loan forgiveness.

The bipartisan group proposed the $908 billion in funding before programs under the CARES Act, like eviction moratoriums and unemployment insurance, expire at the end of 2020.

The group includes U.S. Sens. Mitt Romney, R-Utah; Rob Portman, R-Ohio; Susan Collins, R-Maine; Chris Coons, D-Del.; Joe Manchin D-W.Va.; Mark Warner, D-Va.; Michael Bennet, D-Colo.; and Dick Durbin, D-Ill.

Participants in the Senate committee hearing expressed notable support for additional financial relief this year, while agreement on the level of funding appears to remain out of reach.

The bipartisan proposal would extend the federal unemployment benefits at $300 a week for approximately four months and provide funding for state and local governments, small businesses, health care and student loans, according to The Washington Post.

House Speaker Nancy Pelosi, D-Calif., and Senate Minority Leader Charles Schumer, D-N.Y., reportedly issued a proposal for additional relief, but kept details private, according to the article. Senate Republicans also released a narrower plan for relief Tuesday, including more aid for small businesses and short-term unemployment aid, but no dollars for state and local governments. The Washington Post reports this plan would be opposed by Democrats.

Meanwhile, the House Financial Services Committee also held a hearing with Mnuchin and Powell this week on oversight of their response to the pandemic.

In his testimony and throughout the hearing, Mnuchin urged Congress to pass legislation to allocate unused CARES Act funds for PPP relief—where grants, rather than loans, will be the most effective tool to delivering small-business relief.

U.S. Rep. Andy Barr, R-Ky., raised concerns about the cumbersome PPP loan forgiveness process, adding that community banks will be disincentivized from participation going forward is the rules of the road remain unclear and burdensome. Mnuchin reiterated that Treasury has taken all steps within its available authority to simplify the forgiveness forms, but congressional action would be needed to institute a threshold for forgiveness. Mnuchin said he would support a loan forgiveness threshold of $150,000.

The committee also discussed an updated version of the Health and Economic Recovery Omnibus Emergency Solutions (HEROES) Act, H.R. 925, that would expand some of the lending programs for small businesses and support for frontline workers, schools, individuals and families. It was passed in the House in October.

Committee Chairwoman U.S. Rep. Maxine Waters, D-Calif., also has proposed the “Faster Stimulus Payments and Fed Accounts Act” that would provide monthly direct payments to individuals and families until the economy recovers, according to the hearing memorandum.

Democrats in the U.S. House of Representatives approved the $2.2 trillion relief package and updated version of the Health and Economic Recovery Omnibus Emergency Solutions (HEROES) ACT, 214-207, along party lines, ACA International previously reported.

The updated HEROES Act includes components of the original bill that would have a significant impact on the accounts receivable management (ARM) industry related to credit reporting and some restrictions on debt collection during a national emergency, when collectors can actually help consumers more through hardship programs.

ACA also continues advocacy on the PPP, including seeking support from members of Congress to improve the program’s loan forgiveness process and pass legislation clarifying that expenses related to those loans are tax deductible.   

As part of that advocacy, ACA joined industry trade groups representing the accounts receivable management industry, banks, credit unions, financial institutions, nonprofits and businesses of all sizes, in a letter to members of Congress in support of legislation to reform the PPP, ACA previously reported.


Follow ACA International on Twitter @ACAIntl and @acacollector, Facebook and request to join our LinkedIn group for news and event updates. ACA International members are welcome to submit news items for possible publication to comm@acainternational.org. Visit our publications page for news submission guidelines and subscriptions to ACA Daily, Collector magazine and Pulse.

Advertising is available for companies wishing to promote their products or services. Be sure to visit the ACA Events Calendar on the Education and Training page to view our listing of upcoming CORE Curriculum and Hot Topic seminars featuring critical educational opportunities for your company.


Subscribe to ACA Daily NEWSROOM

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