Congress Races to Approve Virus-Relief Package

By Andrew Duehren and Kristina Peterson

WASHINGTON -- A breakthrough Saturday night on the Federal Reserve's emergency lending powers cleared a path for Congress to approve a roughly $900 billion coronavirus aid package, leaving lawmakers hours to finalize the agreement and vote on it.

With the Fed matter settled, negotiators on Sunday were racing to put the finishing touches on the rest of the bill so the House and Senate could hold votes as early as Sunday on the package.

The emerging agreement is expected to provide $300 a week in enhanced federal unemployment benefits, a $600 direct check to many Americans, as well as aid for schools, vaccine distribution and small businesses.

"This gets done today. No more delays. We are not leaving until we have relief for the American people. People are hurting. People need help," Sen. John Barrasso (R., Wyo.), the No. 3 Republican in the Senate, said on Fox News Sunday.

Party leaders are pairing the relief measures with a roughly $1.4 trillion annual spending package, squeezing lawmakers to quickly write and approve the bill before government funding expires at 12:01 a.m. on Monday. Congress approved a 48-hour extension of government funding on Friday to give negotiators more time to finish the coronavirus relief package.

Senate Minority Leader Chuck Schumer (D., N.Y.) said late Saturday that both the House and Senate would be able to pass the legislation on Sunday. Rushing major bills through the Senate requires consent from rank-and-file members, and Senate Majority Whip John Thune (R., S.D.) has said the process could last into Monday.

"If things continue on this path and nothing gets in the way, we'll be able to vote tomorrow," Mr. Schumer said.

Approving the bill would end an effort to craft another bipartisan aid agreement that stretched for much of the year. After quickly passing nearly $3 trillion in aid in the spring, Republicans and Democrats struggled for months to negotiate another package, with talks at several points breaking down.

But the rapid spread of the virus this fall, signs of a slowing economic recovery, a government funding deadline, and the looming expiration of several existing aid measures pushed lawmakers to reach a deal before Congress takes a holiday break.

Negotiations accelerated this week after congressional leaders agreed to drop two provisions: funding for hard-hit state and local governments, which Democrats and some Republicans had sought, as well as liability protections for businesses and other entities operating during the pandemic, a top GOP priority.

On Saturday night, Mr. Schumer and Sen. Pat Toomey (R., Pa.) were finishing details on a compromise on the Fed's emergency lending powers. Under the deal, the $429 billion would be revoked and the Fed wouldn't be able to replicate identical emergency lending programs next year without congressional approval, according to aides familiar with the legislation. But the agreement wouldn't prevent the Fed from starting other similar programs.

President Trump urged lawmakers to finish work on the relief package. "GET IT DONE, and give them more money in direct payments," he said on Twitter early Sunday morning.

Momentum in the talks had slowed on Friday and Saturday when Democrats objected to a push from Mr. Toomey to insert a measure that would restrict the Fed's ability to establish the types of emergency-lending programs that it authorized in March to curb an emerging financial panic. That step would go beyond an earlier proposal to revoke $429 billion provided to the Treasury Department to backstop losses in the Fed lending programs.

Treasury Secretary Steven Mnuchin last month declined to allow the programs to continue after Dec. 31, saying he didn't think it was legally allowed. A nonpartisan congressional research arm disputed that interpretation on Thursday.

Mr. Toomey had insisted that the Fed be prevented from reviving those programs without explicit congressional approval. His proposal would have barred the Fed and Treasury from independently establishing programs that seek to purchase certain debts of businesses, cities or states, as the Fed has done this year.

A spokesman for Mr. Toomey said early Sunday that the compromise would "preserve Fed independence and prevent Democrats from hijacking these programs for political and social policy purposes."

In March, the Federal Reserve announced lending programs to keep credit flowing to large companies and cities and states. Days later, Congress provided $454 billion for the Treasury Department to cover losses in Fed lending programs. Credit markets rebounded strongly and the Fed ultimately purchased fewer than $30 billion in loans and other assets.

Currently, the Fed and the Treasury Department are allowed to establish any emergency-lending programs if they agree jointly. In deciding to end the current lending programs, Mr. Mnuchin had said the Fed and Treasury would be free to restart them next year with a different funding source.

Fed Chairman Jerome Powell has made the same point, including at a news conference on Wednesday, in an effort to reassure markets should conditions deteriorate.

Lawmakers have also been discussing the duration and limits around a temporary increase in food-stamp benefits and how to structure a relief program for live-performance venues and other industries seeking aid.

--Nick Timiraos and Ken Thomas contributed to this article.

Write to Andrew Duehren at [e-mail] and Kristina Peterson at [e-mail]

(END) Dow Jones Newswires

12-20-20 1141ET