Washington • A much-heralded government program to provide bridge loans to small businesses to keep their employees on the payroll during the coronavirus-caused economic downturn has run out of money while Congress remains deadlocked on how to pour in more funds.
“We had hoped that Congress would act before the funds were exhausted, but the speed with which banks were processing the applications, literally around the clock, didn’t allow enough time for the political gamesmanship that has consumed Washington, D.C., in recent months,” Utah Bankers Association President Howard Headlee said Thursday.
The White House said earlier that the $350 billion fund — meant to shore up businesses with fewer than 500 employees during government-mandated closures because of the virus outbreak — was empty and no new loans would be accepted. The program had allowed small businesses to apply for government-backed loans through banks that would later be forgiven if the money was used to keep employees on staff during the shutdowns.
Republicans have been arguing that Congress should immediately approve more funding for the paycheck program — a move Democrats agree with as long as it comes with more money to boost the health care industry, food stamp participants and state and local governments hard hit by the pandemic.
While Congress acted with unusual speed to pass a $2.2 trillion relief bill to help during the coronavirus outbreak, an impasse between Republicans who control the White House and Senate and Democrats who lead the House has left questions about how long the small business program could continue. Adding to the problem is that the House and Senate are essentially unable to meet in full session because of concerns about spreading the virus.
Rep. Ben McAdams, a Utah Democrat, called Thursday for the partisan sniping to end so that small businesses could find relief.
“I’m talking daily with Utah business owners and seeing how they’re struggling to keep employees on the payroll. Both sides need to compromise to reach a deal," McAdams said. "Our nation’s small businesses and Utah’s hard-working families shouldn’t be used as a political football when millions of jobs are on the line. Get a deal, and get a deal now.”
Rep. Chris Stewart, R-Utah, lashed out Thursday morning, saying on Twitter that small businesses are “now the pawns” in House Speaker Nancy Pelosi's game.
“This is just wrong,” Stewart said.
Sen. Mitt Romney, R-Utah, also argued Democrats should drop any demands and add the $250 billion more for small businesses without any additional requests.
“Emergencies demand emergency action: the Paycheck Protection Program for employees of small business is NOW out of money,” Romney tweeted. “Dems should immediately agree to replenish these funds so we can get urgent help to workers.”
Headlee said that in the 10 days since the paycheck program was launched, Utah small business received nearly 13,000 loans, totaling more than $2.6 billion.
“I am pleased that Utah businesses received a higher proportion of the funds than we would have anticipated based upon the population size of our state,” Headlee said, adding that he urged Utahns to call their members of Congress to push for more funding.
This story will be updated.