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Senate Approves Aid for Small-Business Loan Program, Hospitals and Testing

The Senate passed a $484 billion relief package, after Democrats and Trump administration officials finalized an agreement.

Senator Benjamin L. Cardin, Democrat of Maryland, speaking to reporters on Tuesday at the Capitol.Credit...Anna Moneymaker/The New York Times

WASHINGTON — The Senate approved a $484 billion coronavirus relief package on Tuesday that would revive a depleted loan program for distressed small businesses and provide funds for hospitals and coronavirus testing, breaking a partisan impasse over the latest infusion of federal money to address the public health and economic crisis brought on by the pandemic.

The measure was the product of an intense round of negotiations between Democrats and the Trump administration that unfolded as the small-business loan program created by the $2.2 trillion stimulus law quickly ran out of funding, collapsing under a glut of applications from desperate companies struggling to stay afloat.

But it was only a fraction of the amount of money that Congress will most likely consider in the weeks to come, as lawmakers contemplate spending another $1 trillion or more on yet another sweeping government response to the pandemic, and Democrats vow to revisit items that the administration and Republicans insisted on leaving aside for a future bill.

At the insistence of Democrats, the measure would provide $25 billion for testing and a mandate that the Trump administration establish a national strategy to help states and localities, which are required to outline their own plans for testing. It is a step that public health experts and governors have said will be crucial to allowing states and sectors of the economy to safely reopen in the weeks and months to come, although economists and health researchers say the funding is a fraction of what will ultimately be necessary to deploy the kind of testing and tracing that will be needed to restart large amounts of activity by the summer.

That provision — which the White House and Republican leaders had initially resisted — was one of a host of concessions that Democrats won during more than a week of intense negotiations in which they demanded that the money for the small-business loan program be coupled with funds for other urgent needs.

The resulting deal would bring to $2.7 trillion the amount of federal aid that Congress has approved in the past six weeks — including jobless aid, direct payments to individuals, a corporate bailout and other help for strapped businesses — in an unprecedented effort to respond to the pandemic and the economic chaos it has wrought.

It came as Southern states took their first tentative steps toward reopening, even in the face of warnings from public health experts against moving too quickly. The death toll from the virus climbed past 39,000, and the stock market fell for a second straight day, as global markets retreated and oil prices continued their record slide.

Even as the measure was being completed, Gov. Andrew M. Cuomo of New York met with President Trump at the White House to press for more federal assistance to expand testing for the virus and more funds to help financially devastated state and local governments.

The Senate approval came two weeks after Steven Mnuchin, the Treasury secretary, first asked Congress for an expedited infusion of $250 billion to shore up the newly created loan program for distressed small businesses, known as the Paycheck Protection Program.

Since Mr. Mnuchin’s request, funding has lapsed and the program has been unable to process applications for millions of companies. But Democrats rejected the administration’s request to pass a stand-alone bill funding the program and called for a package twice as large, proposing more money for hospitals, testing and state and local governments. Republicans, for their part, said they agreed with most of the Democratic requests — but initially advocated addressing additional funding in future legislation.

“We are coming together — we have our usual arguments and talking points,” said Senator Mitch McConnell, Republican of Kentucky and the majority leader, in an interview after the vote. “But in the end, we did come together for the country.”

The measure would provide $320 billion for the small-business loan program, with $60 billion set aside for smaller lending institutions, in line with Democrats’ request to steer resources to businesses that typically have trouble getting loans. The package would also add $60 billion for the Small Business Administration’s disaster relief funds — divided into $50 billion in loans and $10 billion in grants — and farms and other agriculture enterprises would be made eligible.

There would also be $75 billion for hospitals, though Democrats failed to secure additional funds for state and local governments, or an expansion of food assistance they had championed.

Republicans “have seen the light — we had a great victory for the American people,” Speaker Nancy Pelosi of California said during a news conference at the Capitol after the vote. “But we certainly need to do more.”

Even as he hailed the agreement, Senator Chuck Schumer, Democrat of New York and the minority leader, said it should have contained far more for states and localities that are struggling under the burdens of the pandemic.

“The efforts of individual states or individual citizens — heroic as they are — will not be enough, and we dare not abandon them in these dark times,” he said. “The American people need their government. They need their government to act strongly, boldly and wisely.”

The House was expected to pass the measure on Thursday, clearing it for Mr. Trump, who indicated in a post on Twitter that he would sign it. Once he did, the president wrote, discussions would begin over yet another round of coronavirus relief that would include money for state and local governments, investments in infrastructure, tax incentives for restaurants, entertainment and sports and payroll tax cuts, the latter of which has repeatedly been rejected by lawmakers in both parties.

The impasse remained charged until minutes before the vote on Tuesday afternoon, as negotiators haggled over the final details. The Senate passed the measure by voice vote — a necessity because most senators were not present as the chamber had been in a prolonged recess — after two Republican senators, Rand Paul of Kentucky and Mike Lee of Utah, raised objections to the cost of the package and its approval without the full chamber present.

“Even more alarming than the money is the idea that one senator can stand on the floor and pass legislation spending half a trillion dollars and have no recorded vote and no debate,” said Mr. Paul, a libertarian. He said he had returned to Washington “so that history will record that not everyone gave in to the massive debt Congress is creating.”

House Republicans were expected to force a roll-call vote that would summon members back to Washington to vote on the package, which is expected to come as early as Thursday morning.

“We are asking every member to return who can return, and we hope that is a large number,” Representative Steny H. Hoyer, Democrat of Maryland, said on Tuesday.

But the vote might be the last one for some time under which a majority of the House would have to be physically present. Democratic leaders were expected to move this week to change the rules to allow lawmakers to vote remotely by proxy, a historic step that would reduce the number of representatives who would need to return to Washington during the pandemic.

In contrast, Mr. McConnell predicted that the Senate would not try to approve another legislative response to the pandemic without all 100 senators back in Washington and negotiating in person.

“We ought to bring everyone back and have full participation, begin to think about the implications to the country’s future with this level of national debt,” he said at a news conference.

While negotiators agreed to increase the administration’s original request, it was unclear how long the new funds could sustain the program, which had a rocky rollout that stretched the capacity of the Small Business Administration, the small federal agency overseeing it.

It took only 13 days to exhaust the original tranche of $349 billion, which covered more than 1.6 million loans from nearly 5,000 lenders — more than 14 years’ worth of loans typically processed by the agency. And the program has been criticized for failing to reach the businesses that needed it most, after it emerged that large restaurant chains had gotten money while many smaller companies were unable to.

Congress is likely to face calls to expand the program further, increasing the range of small businesses that could receive loans, and to provide still more funding.

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Senator Mitch McConnell, the majority leader, arriving Tuesday at the Capitol.Credit...Anna Moneymaker/The New York Times

White House officials acknowledged that they would soon be back at the table for new talks.

“We’ve got to get through this stimulus, and then it’s on to the next stimulus,” Larry Kudlow, the chairman of the National Economic Council, told reporters.

Mr. Schumer, Mr. Mnuchin, Ms. Pelosi and Mark Meadows, the White House chief of staff, negotiated Monday night and into the wee hours of Tuesday morning in an effort to resolve an impasse over Democrats’ demands for a national testing strategy, as well as their call for more money for state and local governments.

The two Democratic leaders vowed to continue pushing for the additional funds in future measures, as well as hazard pay for front-line workers, worker protections, election security funds and food assistance. Republicans have so far resisted the inclusion of most of those provisions in the four packages that have now passed through the Senate.

“I’m not doing anything that’s non-coronavirus related,” Mr. McConnell said in the interview, though he acknowledged that efforts to supply more funding to state and local governments would prompt “a big debate, and we’ll do it when we’re all back here together.”

The National Governors Association continued to call for a half-trillion dollars to help counter budgetary shortfalls, as well as other investments to support states, and Mr. Cuomo was particularly scathing about the measure.

“I think it’s a terrible mistake not to provide money for the states,” he said in Buffalo before traveling to Washington to meet with Mr. Trump. “I get small businesses, I get airlines. How about police? How about fire? How about health care workers? How about teachers? We’re not going to fund schools? I don’t get it.”

The measure would steer $11 billion of the money for testing to states, and mandate that states, localities, territories and tribes also create their own plans for testing and mitigation.

It would also provide more money to the federal government for testing, including $1 billion for the Centers for Disease Control and Prevention, $1.8 billion for the National Institutes of Health, $1 billion for testing those without health insurance, and $22 million for the Food and Drug Administration. There would also be $1 billion allocated for the Biomedical Advanced Research and Development Authority and $825 million for community health centers, rural health centers and other health institutions.

And it would set aside $6 million for the Department of Health Human Services inspector general to conduct oversight.

Catie Edmondson contributed reporting from Washington, and Alan Blinder from Atlanta.

Emily Cochrane is a reporter in the Washington bureau, covering Congress. She was raised in Miami and graduated from the University of Florida. More about Emily Cochrane

Jim Tankersley covers economic and tax policy. Over more than a decade covering politics and economics in Washington, he has written extensively about the stagnation of the American middle class and the decline of economic opportunity. More about Jim Tankersley

A version of this article appears in print on  , Section A, Page 1 of the New York edition with the headline: Senate Approves More Aid to Fund Small Businesses. Order Reprints | Today’s Paper | Subscribe

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