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Grants for restaurants, small businesses blocked in Senate

Lindsey McPherson, CQ-Roll Call on

Published in Business News

WASHINGTON — Deficit-concerned senators blocked the Senate from considering a $48 billion aid package for restaurants and other small businesses Thursday, likely dealing a fatal blow to a months-long effort to provide a final round of relief for industries that suffered major revenue losses during the pandemic.

The Senate did not invoke cloture on the motion to proceed to the small-business aid bill, in a 52-43 procedural vote that was subject to a 60-vote threshold.

All but five of the 50 Senate Republicans voted against cloture, which was more than enough to mount a successful filibuster to prevent the Senate from even considering the measure for debate.

Senate Small Business Chairman Benjamin L. Cardin, D-Md., and Sen. Roger Wicker, R-Miss., worked on the small-business aid package for months. The duo drew on past bipartisan proposals in an attempt to spread benefits far and wide, offering relief to stakeholders ranging from stage, lighting and sound providers for live events to minor league sports franchises.

“We must pass this legislation to keep these vital parts of America’s economy and America’s social and community life going,” Majority Leader Charles E. Schumer said on the floor Thursday before the vote. “When minor league teams closed, entire towns have fewer options for coming together. When theaters can’t open because businesses they rely on closed down, it disintegrates the fabric of our communities.”

‘Fits and starts’

Through a period of what Cardin called “fits and starts,” he and Wicker remained optimistic that the bipartisan support needed to pass the bill would materialize once it was brought to the floor.

But as the test vote drew closer, it was apparent they wouldn’t get to 60 votes. So Cardin made a last-ditch offer to cut the size of the package and allow for an open amendment process in hopes of winning over hesitant senators.

“We believe we’ll be able to get the cost of this bill down, but we first need to get on the bill,” Cardin said, citing various offers from senators on both sides of the aisle with ideas on how to more narrowly target the measure.

One of those was an amendment from Joe Manchin III, D-W.Va., that he said would limit aid to business owners who incurred debt in order to stay afloat during the pandemic. Manchin said he voted for cloture because of a commitment from Cardin that his amendment would be considered.

Cardin’s plea worked on at least one GOP senator. Alaska Republican Lisa Murkowski had said earlier Thursday she was still undecided because while restaurants in her state “are still facing some pretty tough times,” she wanted to see the cost of the package come down. She ended up voting to advance the bill.

But ultimately it wasn’t enough. The only Republicans to vote for cloture on the motion to proceed were Wicker, Murkowski, Susan Collins of Maine, Roy Blunt of Missouri and Bill Cassidy of Louisiana.

“Louisiana has one of the highest per capita presences of restaurants for major tourists,” Cassidy said. “We had a COVID lockdown that’s equal to any other city in New Orleans. And a lot of those businesses are currently trying to work through the high cost of labor, they have abbreviated hours, etc.”

In contrast, Louisiana’s other senator, Republican John Kennedy, voted against advancing the bill. Like others who opposed the measure, he cited concerns about adding to the deficit and further fueling inflation.

“I have great sympathy for our restaurants, but at some point we have got to stop spending money that we don’t have,” Kennedy said. “Nobody ever stands up around here and says I’ve got a bad idea and I need money for it. These are all worthy causes. But a big portion of the inflation was caused by the amount of spending that Congress has done.”

Barely a tenth of the $48 billion package was paid for, with $5 billion in unspent funds from the lapsed Paycheck Protection Program, a forgivable loan program first enacted in March 2020 that helped small businesses keep employees on payroll.

For the true spending hawks who also opposed a deficit-financed $40 billion Ukraine aid package the Senate cleared earlier Thursday, it was a rough day.

“We sent $40 billion out before lunch. They want to send $48 billion more after lunch,” Small Business ranking member Rand Paul, R-Ky., said in floor remarks between the two votes. “Oh boy, we have an emergency that we need to get the minor league sports involved with the bailout while Americans across the country are getting poor.”

‘Fairness’

The anchor of the package was $40 billion to backfill a depleted grant program for restaurants, bars and other food and beverage service providers enacted early last year.

 

Wicker has long described providing that money for the so-called Restaurant Revitalization Fund as a matter of “fairness,” because it would not reopen the grant program to new applicants but rather provide awards to the roughly two-thirds of businesses who qualified for the initial round but didn’t receive money before the $28.6 billion appropriated ran out.

In an effort to learn from past mistakes, the Cardin-Wicker bill called for the Small Business Administration to prorate grants, if needed, to ensure every qualified applicant received some funds.

The other $8 billion would have been used for smaller grant programs for other industries that were excluded from previous relief laws:

— $2 billion to gyms and fitness centers.

— $2 billion for live event servicers, such as companies that provide staging, lighting, sound and casts for theaters.

— $2 billion for transportation service providers, such as buses and ferries.

— $1.4 billion for very small businesses located within 50 miles of land ports of entry that were closed due to the pandemic, with at least one-third set aside for firms located near the Mexican border and another one-third for businesses close to the Canadian border.

— $500 million for minor league sports teams.

— $85 million for small businesses in Alaska, Washington and Minnesota that are geographically separated from the rest of the U.S. and weren’t accessible due to pandemic-related Canadian border closures.

Cardin and Wicker formally introduced their bill last month, the same week the House passed its own $55 billion small-business aid package.

The House bill, which also has no apparent path to Senate passage, included $42 billion to backfill the Restaurant Revitalization Fund and $13 billion for an industry-neutral grant program for “hard-hit” businesses based on size and revenue loss.

Other vehicles?

Restaurant and small business aid backers will likely continue to push for relief in other must-pass vehicles, like a stalled $10 billion COVID-19 supplemental for the government to purchase more vaccines, therapeutics and other supplies needed to respond to future virus variants or a fiscal 2023 spending package.

But without more offsets, any effort to spend billions more on pandemic relief — after Congress already appropriated more than $5 trillion toward the effort since 2020 — will be met with GOP resistance.

“We never say never,” Cardin said. “I just don’t know how we’re going to be able to get it (done). If we can’t get the votes now, why would we get them later?”

If Democrats are willing to concede the business aid package is dead, they could take its $5 billion PPP offset and use it to add more spending to the COVID-19 aid package. There had been bipartisan interest in spending $5 billion to send vaccines and other supplies to vulnerable populations overseas, but the international aid was cut due to lack of agreement on offsets.

Other provisions in the Senate and House small-business aid packages that don’t cost any money could also easily be added to other vehicles, such as language to extend the available time businesses previously awarded Shuttered Venue Operators Grants have to spend their money.

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(CQ-Roll Call writers David Lerman and Aidan Quigley contributed to this report.)

©2022 CQ-Roll Call, Inc., All Rights Reserved. Visit cqrollcall.com. Distributed by Tribune Content Agency, LLC.

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