Senate Majority Leader Mitch McConnell is proposing that Congress funnel $455 billion of unspent small business lending funds toward a new COVID-19 aid package.
The Republican leader’s offer Friday comes after a morning meeting with Treasury Secretary Steven Mnuchin and White House Chief of Staff Mark Meadows. They are trying to kickstart stalled negotiations with Democrats on a year-end virus aid package in the lame-duck Congress.
“Congress should repurpose this money toward the kinds of urgent, important, and targeted relief measures that Republicans have been trying to pass for months,” McConnell said in a statement.
Congress has been at a standstill as House Speaker Nancy Pelosi is pushing for $2 trillion in new coronavirus aid, but McConnell insists on a more narrow $500 billion package. The availability of new funds could raise the pricetag closer to a compromise.
On Thursday, Mnuchin announced he would not extend some of the Federal Reserve’s emergency loan programs that had been aimed at COVID relief. The Fed’s corporate credit, municipal lending and Main Street Lending programs will end as of Dec. 31.
Critics said the Treasury Department’s move was designed to hinder President-elect Joe Biden’s administration by halting needed lending. Mnuchin said Friday on CNBC that Congress could make better use of the money.