Covid Aid Funding Deal needs revision after offsets are issued

Lawmakers must renegotiate a funding deal for Covid-19 therapeutics and vaccines as billions of dollars designated as offsets have already been spent, key senators said.

Senators reached a bipartisan agreement in April to spend $10 billion on Covid resources and offset their costs by canceling funds previously committed. But the measure has suffered amid a fight over the proposed end of the Title 42 pandemic immigration policy, and some of the $10 billion in proposed “pay-fors” have already been spent.

Well, some of the key contributors to the original deal, Sens. Mitt Romney (R-Utah) and Roy Blunt (R-Mo.) said lawmakers would need to resume negotiations on the offsets if they eventually decide to accept a Covid bill. Between $2 billion and $4 billion of the $10 billion in funds earmarked for compensation has already been spent, a senior Republican Senate aide said.

Photographer: Eric Lee/Bloomberg

Romney speaks to members of the media after voting April 5 at the US Capitol in Washington, DC, United States.

Blunt added that the previous agreement to spend a total of $10 billion may also need to be changed. Demand has increased in nearly two months, he said. White House officials have also repeatedly asked for more than $20 billion in Covid aid.

The development poses another challenge to the process of approving a Covid law, which has been delayed due to battles over compensation payments, immigration, international aid and a general lack of motivation among lawmakers.

Read more: Covid Funds Slip Down Agenda as Congress jumps between crises

Waiting for Schumer

Romney said lawmakers must renegotiate the settlements, but that won’t happen until the Senate Majority Leader is elected Chuck Schumer (DN.Y.) wants to record an account. He said he believes lawmakers will be able to find enough new offsets if motivated.

“We’ll probably need to update the pay fors, but so far Leader Schumer hasn’t been willing to put the bill on the floor,” Romney said. “Until he does, it’s kind of moot.”

Romney announced the first deal on April 4 to withdraw $10 billion in unspent funds from previous pandemic relief efforts. This included $2.3 billion in grants for aircraft manufacturing, more than $1.9 billion from Small Business Administration grants for closed venues such as concert halls and theaters, and $1.6 billion to various grants from the Ministry of Agriculture as part of pandemic response measures.

These accounts included almost every grant or loan program that is still operational but with unspent funds. Since April, while lawmakers debated how to pass the Covid relief package, the coffers of these programs have dwindled.

For example, the Small Business Administration distributed approximately $800 million in grants from the Shuttered Venues Operations program, according to public reports from the SBA.

And Treasury Department officials announced late last month plans to send $200 million in Small Business Credit Initiative funds to various states and transfer $100 million from that initiative to another program at Commerce.

Distracted Congress

Blunt agreed that paying the bill was an unresolved issue, but that Congress’ ability to actually focus on the measure was the more immediate concern.

“I think it needs to be renegotiated,” said Blunt, senior member of the Senate subcommittee on labor and HHS education. “But again, you have to have the environment to do that.”

Sen. Patty Murray (D-Wash.), chair of the Senate Appropriations Subcommittee on Labor-HHS Education, agreed that the biggest challenge for lawmakers is adopting a Covid bill rather than compensation payments.

“We fought this dog for a long time,” Murray said. “I think it’s very clear what the real problem is – that we need to get Covid dollars now so we can buy therapeutics, so we can buy the new vaccines, so we can do testing and we’re ready. We don’t have that at the moment.”

Senators, who are pushing for more money for global vaccination efforts, are also preparing to argue that the package should include billions more dollars to send Covid vaccines to other nations.

Sen. Chris Coons (D-Del.) told reporters Thursday he believed there was a way to increase the overall package if lawmakers could vote on it.

“We’re going to revisit all of this when we start, so I wouldn’t conclude that trading down to 10 is the finish line,” he said, referring to the $10 billion package.

To contact reporters on this story: Alex Ruf in Washington [email protected]; Jack Fitzpatrick in Washington [email protected]

To contact the editors responsible for this story: Giuseppe Macri at [email protected]; Anna Yukhanov at [email protected]

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