(Bloomberg) -- Negotiations between Democrats and the Trump administration on a deal to replenish a small business aid program and assist hospitals spilled into Monday as both sides raced to put together a package that Congress could approve this week.
With some details of a nearly $500 billion interim coronavirus rescue package still to be nailed down, it was uncertain whether the Senate could take up the legislation on Monday, as Treasury Secretary Steven Mnuchin had forecast. Several issues remain outstanding, according to three Democratic officials.
A person familiar with the negotiations said Monday that Democrats and Republicans still had a disagreement over the formula to distribute health-care aid to the states.
But House members have been put on notice of a possible vote on Wednesday, indicating leaders in both parties anticipate reaching an agreement.
The basic outlines of the package include a $310 billion infusion for the tapped-out Paycheck Protection Program, or PPP, designed to help small businesses keep workers on their payrolls; $50 billion to $60 billion more for a separate Economic Injury Disaster Loan program; $75 billion for hospitals, with a significant portion aimed at those in rural areas; and $25 billion for virus testing.
One of the remaining disagreements is over the testing program, including which agency -- the Centers for Disease Control and Prevention or the National Institutes of Health -- should oversee it, according to one person familiar with the discussions.
Mnuchin and House Speaker Nancy Pelosi both said Sunday the two sides were close to a deal. President Donald Trump was cautiously optimistic about breaking the deadlock in place all of last week as the Paycheck Protection Program ran through its entire $349 billion in funding.
“We have a good chance of getting a deal,” Trump said at a briefing on Sunday. “A lot of good work has been going on. We could have an answer tomorrow.”
“We have common ground,” Pelosi said on ABC’s “This Week.” “I think we’re very close to an agreement.”
But Pelosi is coming under pressure from her party’s liberal wing to wring more concessions, including aid for state and local governments that the GOP is resisting putting in the package.
“It is going to be very difficult to support a package that doesn’t have what we need in terms of help for state and local governments,” Pramila Jayapal, head of the Congressional Progressive Caucus, said on a conference call.
While the Senate has a pro forma session scheduled for Monday, leaders of both parties first would have to ensure no senator would object to the agreement in order to pass it by unanimous consent. That typically would require circulating legislative text.
The Senate’s next session is currently set for Thursday, though another could be scheduled sooner.
House Majority Leader Steny Hoyer sent a notice to lawmakers Sunday that the chamber could meet as soon as Wednesday to consider the legislation. Because an objection to unanimous consent is likely, Hoyer said the House would probably have to convene for a recorded vote.
House Democrats will get an update on the status of the talks during a caucus-wide call with Pelosi and other leaders at 4 p.m. Monday. Former HHS Secretary Sylvia Burwell and former World Bank President Jim Yong Kim will be guests on the call for a discussion on the public health response to the Covid-19 pandemic.
House Republicans were told during a conference call Sunday to expect to vote on the package Wednesday in Washington, and that the Senate likely would act before that.
Mnuchin briefed Republicans in both chambers on the outlines of the deal during conference calls on Sunday.
During the Sunday call with GOP senators, Majority Leader Mitch McConnell and Mnuchin said the agreement won’t include aid for state and local governments, according to a Republican aide. That had been one of the original demands of Pelosi and Senate Democratic leader Chuck Schumer.
Another Democratic proposal, an increase for the food stamp program, also was left out, the aide said McConnell and Mnuchin told the GOP lawmakers on the call, which was joined by Trump and White House Chief of Staff Mark Meadows.
The state and local government aid was a significant part of what the Democrats were seeking and even it was short of what governors and mayors say they need.
Maryland Governor Larry Hogan, a Republican and chairman of the National Governors Association, and New York Governor Andrew Cuomo, a Democrat who is the NGA’s vice-chairman, said on April 11 that without at least $500 billion, states would have to curtail essential services as tax revenue plummets and demand for resources skyrocket.
That may have to wait.
The additional funding being negotiated is considered an interim step in efforts to prop up a U.S. economy frozen by the nationwide shutdown caused by the spread of the novel coronavirus. There’s general agreement in Congress and at the White House that a so-called phase four comprehensive economic rescue package would be needed, following the $2 trillion package approved late last month.
Democratic Senator Bob Menendez of New Jersey and his Republican colleague Senator Bill Cassidy of Louisiana on Sunday proposed creating a $500 billion fund for state and local governments as part of the next comprehensive rescue package from Congress.
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