Congressional Update: Paycheck Protection Extension, Infrastructure, Electric Vehicles

Last week, the U.S. House passed legislation that provides a two-month extension, through May 31, for Paycheck Protection Program (PPP) applications.

There is bipartisan Senate support to pass the extension, but Republican Senators introduced a modified version, which would prevent the SBA Administrator from prioritizing certain businesses without approval from Congress.

News reports speculate this effort is intended to pre-empt Biden Administration plans to direct certain funds specifically to minority-owned businesses.

While the Senate is still expected to pass an extension, this development could delay passage, which will require the support of at least 10 Republican Senators to meet the Senate’s 60-vote threshold.

EMA is concerned by the lack of progress on major Paycheck Protection Program (PPP) processing issues, including hold/error codes and application rejections due to Taxpayer Identification Number (“TIN”) issues or mismatches, in addition to many unresolved technical problems with the current PPP process.

These delays and denials may put many applicants in danger of not making the March 31st authorization deadline.

Nearly one year into the COVID-19 pandemic, the continued liquidity challenges of the small business sector are acute, especially for those businesses limited by dramatic capacity restrictions and other critical health and safety protocols in place to protect the public, consumers and workers from COVID-19.

Infrastructure

Congress and the Biden Administration continue considering potential vehicles for a broad infrastructure package. However, battle lines are forming due to disagreements regarding potential tax increases.

Democrats and the Biden Administration would prefer to pay for a package by raising corporate taxes, but Senate Minority Leader Mitch McConnell (R-KY) said Republicans would not support tax increases.

While senior Senate Democrats and President Biden would prefer a bipartisan package, fundamental disagreements over the scope of a package and how to pay for a package may force Democrats to pursue a smaller package through budget reconciliation – the same process used to pass the most recent COVID-relief package.

Alternatively, Democrats could negotiate a tailored bipartisan package with Republicans, likely focusing on surface transportation, and passing additional provisions through a partisan budget reconciliation process.

This effort is supported by more moderate Senate democrats such as Sens. Joe Manchin (D-WV) and Kyrsten Sinema (D-AZ).

While the House will be out of session the next three weeks, the powerful Ways and Means Committee plans to begin mapping out an infrastructure approach soon.

There has been some discussion over a per-mile tax on commercial trucks, however, singling out trucking is a non-starter for conservatives unless the left agrees to repeal the EV tax credit and impose fees on EVs to shore up the highway trust fund.

Bill Sullivan, the American Trucking Associations’ executive vice president of advocacy, said the trucking industry “currently pays half the receipts into the Highway Trust Fund, while we’re only 4 percent of vehicles and 9 percent of miles traveled” and they don’t want to be “singled out with discriminatory truck-only fees to pay for our nation’s infrastructure needs.”

Electric Vehicles

The Democratic and Republican leaders of the Senate Energy Committee cautioned the Biden Administration on its promises for Electric Vehicle (EV) deployment.

Chairman Joe Manchin said he supports EVs overall but is concerned with U.S. reliance on China for critical minerals integral to EV components.

Ranking Member John Barrasso (R-WY) said he was “concerned that [President Biden] wants to regulate the internal combustion engine out of existence and insist that all Americans use electric vehicles.”

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