Saks Fifth Avenue says government rules that prohibit federal assistance to firms with too much debt don’t take into account its vast real-estate holdings and other collateral options.
Photo: elijah nouvelage/ReutersWASHINGTON—Lobbyists for business groups, labor unions and nonprofit associations are shifting into high gear as Congress considers what could be a final round of aid to combat the economic fallout of the coronavirus pandemic.
Some are working on behalf of individual companies, including Hudson’s Bay Co.-owned Saks Fifth Avenue, which wants changes in rules so it can qualify for financial aid. Others are advocating for not-for-profit organizations, including local chapters of the PGA of America, which want access to government loans but can’t get them because of their tax structure.
More broadly, a coalition of U.S. businesses wants sweeping liability protections from lawsuits that may result if companies and stores reopen and patrons or employees get sick—setting up a conflict with labor, which thinks that would lead companies to open more quickly, putting workers at risk.
Democrats, meanwhile, are looking to dramatically expand stimulus aid, setting up a new fight along old fault lines. Republican Senate Majority Leader Mitch McConnell says any new aid should be tied to liability protections for businesses.
Democratic House Speaker Nancy Pelosi and Senate Minority Leader Chuck Schumer told union officials on a call this week that a blanket liability provision that aimed to help business without protecting workers would be unacceptable. Mr. Schumer later repeated this position in an interview on PBS.
Public-employee unions want Congress to allocate $700 billion in aid to help states and local governments to continue functioning. Most of the aid so far has gone to businesses and individuals.
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Without help from the federal government, the “same people who have been risking their lives to protect us will get pink slips as a thank you,” said Lee Saunders, the president of the American Federation of State, County & Municipal Employees, which represents 1.4 million mostly government employees.
Some nonprofit associations who were kept out of previous bills because of their tax structures say they, too, need access to government assistance.
The American Society of Association Executives, which represents nonprofit business associations, including chambers of commerce, says the pandemic dried up their revenue from dues and sponsorships. The group has won the support of dozens of Republican and Democratic lawmakers who are seeking to reverse an executive-branch rule that prohibits such 501(c) 6 and (c) 7 entities from qualifying for federal loans.
That is the prohibition that denied local sections of the PGA and not-for-profit members-only golf clubs, said Seth Waugh, the chief executive of the PGA of America, which is advocating that the golf industry be included in a new round of aid.
Mr. Waugh said the golf industry has sent more than 20,000 letters to members of Congress and personally appealed to senators and representatives for the same type of financial assistance other industries received.
“If you’re a waitress at a private (golf) club as opposed to a restaurant down the street, there’s no difference,” Mr. Waugh said. “You’re not bailing out a club, you’re bailing out individuals.”
Other organizations are seeking relief from measures that were aimed at preventing coronavirus aid to companies that have lots of debt.
Saks Fifth Avenue thinks government rules that prohibit federal assistance to firms with too much debt don’t take into account the vast real-estate holdings and other collateral options of many department stores. Such a change could help Saks and others qualify for federal help.
Saks has hired a former top Senate aide as a lobbyist, and hopes to win the support of Mr. Schumer, a Democrat from New York. Saks Fifth Avenue’s flagship department store is in Manhattan.
Men’s grooming company Harry’s Inc. has hired a lobbyist close to President Trump to try to change another provision that makes it harder for startup companies to qualify for loans backed by the government.
New companies can take years to be profitable, making them ineligible for government help due to a rule that prevents loans to failing businesses. Harry’s doesn’t qualify for federal assistance under that rule, even though its business appears to be thriving. Last year, a rival grooming company tried to buy it for $1.4 billion.
The PGA is advocating that the golf industry be included in a new round of aid.
Photo: Keith Srakocic/Associated PressOn April 13, Harry’s hired lobbyist Brian Ballard, a top fundraiser for Mr. Trump’s presidential campaign. Joshua Kushner, the brother of Mr. Trump’s son-in-law and adviser, is a Harry’s director and investor.
Meanwhile, a new coalition argues that the terms of the Paycheck Protection Program for small businesses and the Main Street Lending Program for larger companies are a mismatch with the long-term needs of vast swaths of the economy.
More than 100 retailers, commercial real-estate firms and insurers want to create what they are calling “America’s Recovery Fund,” which would build on the already historic economic rescue efforts. The coalition, which will formally launch on Monday, wants more federal support, over a longer time, to more companies, said Trevor Hanger, the group’s research director.
“Businesses across numerous sectors are not going to make it without additional support,” said Mr. Hanger, whose coalition includes the International Council of Shopping Centers, the Retail Industry Leaders Association and the National Association of Convenience Stores.
The existing PPP program is aimed at getting businesses to retain or rehire employees. The coalition contends the needs of consumer-facing businesses and their landlords are more complex and require grants that can be spent over a much longer period, with the flexibility to spend more on expenses like rent, utilities, taxes and debt.
A separate coalition of restaurants is pressing Congress to create a $120-billion “stabilization fund” targeted to help restaurants specifically because existing federal programs have failed them.
The group, called the Independent Restaurant Coalition, asserts that restaurant workers account for a majority of the job losses stemming from the coronavirus shutdown, but qualified for just 9% of the loans from the PPP program.
A broader group of restaurants, led by the National Restaurant Association, is supporting a package that helps all companies.
A group of companies that run Health Savings Accounts is pushing Congress to change existing rules to permit more Americans to use the tax-preferred accounts to pay for medical expenses related to the coronavirus epidemic.
Under complicated rules for the tax-advantaged medical savings plans, individuals must have a health insurance plan with a high deductible. Companies that administer such accounts have asked Congress to suspend that rule temporarily.
One such company, Starship HSA, hired lobbyist Daniel Perrin to press for the change. Mr. Perrin recently secured a letter from more than 30 conservative organizations supporting the change. Sen. Ted Cruz (R., Texas) has proposed legislation to do so.
“Ending this mandate would give millions of individuals and families access to a portable, tax-advantaged savings vehicle that can be used on health-care expenses,” wrote the groups, including Americans for Tax Reform.
Write to Ted Mann at ted.mann@wsj.com and Brody Mullins at brody.mullins@wsj.com
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