WASHINGTON (CN) — As Congress begins work on a sweeping stimulus package to respond to the coronavirus pandemic, Senate Republicans unveiled plans Wednesday for a $300 billion economic relief package to help small businesses struggling amid the outbreak.
The bill is still being finalized, but Senators Marco Rubio and Susan Collins said at a press conference Wednesday that the proposal would allow the federal government to provide loans to small businesses that would cover payroll for a set period of time, likely six weeks.
Those loans would be available to companies defined as small businesses under federal regulations and would be forgiven, essentially becoming grants, for businesses that use the money to pay workers and keep afloat during that time period, though the exact requirements for forgiveness are not yet clear.
Rubio, a Florida Republican and chair of the Senate Small Business Committee, explained that if a small business uses the loan to pay the salaries of its employees while it is shut down or while its workers are quarantined, the loan would be forgiven. He also said he expects businesses will use the money to keep up to date on rent and mortgage payments.
“Every penny that they borrow and use for purposes of keeping people employed, they will not have to pay back,” Rubio told reporters Wednesday.
Collins, a Maine Republican, said the goal of the bill is to make sure small businesses do not need to resort to massive layoffs as the outbreak brings on widespread closures and a historic economic downturn.
“It is intended to ensure that employees can make it through this period, that the small business can make it through this period and that when this crisis passes, they can reunite,” Collins said. “And we will still have vibrant Main Street businesses employing millions of Americas.”
The bill would include language preventing a loan from being forgiven if a business uses the money to give raises to owners or increase profits, the senators said. Rubio also said senators and the Treasury Department are working on including additional restrictions for businesses that are not taking an economic hit as a result of the outbreak.
In an effort to slow the spread of the disease and reduce pressure on hospitals, states across the country have instituted restrictions on businesses, including closing restaurants and bars and banning gatherings of large numbers of people.
The package is part of a Trump administration-backed stimulus plan that could run a $1 trillion price tag, which the Senate is expected to consider in the coming days. Earlier in the day, the Treasury Department circulated a two-page plan that includes $500 billion in direct payments to taxpayers that would go out in two waves, one in April and one in mid-May. The exact amount of the payments is still unclear.
Collins said she is hopeful the small business relief plan, along with the rest of the forthcoming stimulus package, could pass “sometime this weekend.”