Bipartisan duo tries to create opening for broader small business coronavirus-relief program

It's a push that isn't guaranteed to succeed, particularly amid public outrage at the ability of larger public companies to tap into the emergency forgivable loan program, known as the Paycheck Protection Program.

But it's one that Sens. Todd Young, an Indiana Republican, and Michael Bennet, a Colorado Democrat, have spent months laying the groundwork for -- cognizant, they say, of broader risks facing businesses as the coronavirus pandemic continues to wreak havoc across the country.

"We laid down the proposal very early to socialize it, to earn the support of outside groups and, frankly, to allow for critical analysis and feedback from some of those key stakeholders," Young told CNN in interview.

Those stakeholders included the Senate Small Business Committee members who created the Paycheck Protection Program to begin with -- Sens. Marco Rubio of Florida and Ben Cardin of Maryland, the top two members of the panel, have been kept apprised, the senators said -- as well as the White House and Treasury Department. That effort started to pay off at a hearing on Capitol Hill last week.

"I think parts of it should be incorporated" in the next stimulus package, Treasury Secretary Steven Mnuchin, the lead Trump administration negotiator on the package, told lawmakers of the proposal.

A week prior, the bill picked up 10 new Senate co-sponsors -- five Democrats and five Republicans. Outside groups including the National Association of Manufacturers, the National Restaurant Association and the American Hotel & Lodging Association have also thrown their considerable weight on Capitol Hill behind the proposal.

A bipartisan group of House lawmakers introduced a companion proposal across the Capitol as well.

Young, who has publicly praised the Paycheck Protection Program and its impact in his home state, said the realities of the length and depth of the crisis were "going to require a more flexible model and, frankly, a more robust model so that we can have longer-term certainty."

At the heart of the idea is to fill gaps and shortcomings in the existing constellation of emergency federal efforts. The Paycheck Protection Program's own architects acknowledge there are shortcomings given how it was drafted. The program was designed to support payrolls for a two-month period, the idea being the US would start to emerge from the economic restrictions by that time.

Another crucial component of the initial federal effort is the Federal Reserve-run Main Street Lending Program, which was designed to provide loans to companies that were too large to qualify for the Paycheck Protection Program but too small to take part in other lending facilities. After a lengthy rollout period of shifting terms in an effort to entice more interest in the facility, the Fed has purchased only a single, $12 million loan through the facility.

"What the MSLP cannot do, as a result of the Federal Reserve's statutory and regulatory obligations, is help businesses facing serious declines in revenue that cannot take on additional debt to address that problem," the Congressional Oversight Commission, a watchdog appointed to oversee $500 billion in emergency funds, said in a Monday report.

"The Main Street Lending Program is not going to solve this," Bennet told CNN. "The PPP by itself isn't going to solve it. I think this can fill the gap."

The Young-Bennet proposal would utilize a structure similar to that of the Paycheck Protection Program in order to provide loans to cover, up to $12 million, six months of payroll, benefits and fixed operating expenses for businesses hardest hit by the pandemic -- a revenue loss of 25% or more. Businesses with up to 5,000 employees would qualify and companies would have seven years to pay off the loans, with loan forgiveness determined by size and decline in revenues.

Young and Bennet acknowledged concerns that given the existing Paycheck Protection Program infrastructure and the long-standing work on the program, there would not be interest in a broader program. Bennet framed it as a "concern that we don't have the imagination to do something different."

"But I think we do have the imagination to do something different, and I think need to because of the gap," Bennet said. "We're not at a moment where we can take our foot off the gas here."