The congressional COVID-19 oversight commission is about to sunset

An Arkansas congressman is the last person left on a congressional oversight body established by the CARES Act that is sunsetting on Friday.

“I have infinite confidence in my own ability” Rep. French Hill, R-Ark., joked in a recent interview with Government Executive, but in all seriousness “our commission started out with a strong bipartisan effort to make sure we properly oversaw the largest expanse of rescue money in American history in the shortest amount of time and we did that effectively and we had excellent cooperation from, generally, the Federal Reserve and Treasury.” 

The Congressional Oversight Commission was one of the three entities established by the CARES Act in March 2020 to oversee how the Treasury Department and Federal Reserve used specific taxpayer funds to stabilize the economy due to distributions from the COVID-19 pandemic. It was slated to be bipartisan and have five members: two from each party and a chair who congressional leadership was supposed to select, but never did. The Democrats left the commission between December 2020 and May 2021 and then it was down to Sen. Pat Toomey, R-Pa., and Hill. But after Toomey retired at the end of last Congress, it has just been Hill. 

He said they could have been more effective with a chair, but “during the months of 2020 and 2021, when it mattered, we had a functioning, for the most part, bipartisan group that was effective at doing our oversight.” As of Jan. 8, 2021 all of the emergency lending programs had ceased operations.

The commission was initially supposed to go until Sept. 30, 2025, but the government spending package for fiscal 2023 changed it to June 30, 2023.

“Sen. Toomey and I discussed this: based on the status quo nature of the lending facilities and the structure and the fact that we have this elaborate [inspector general and Government Accountability Office] oversight that continues, we felt that without additional, new commitments that it was appropriate for the commission to sunset early,” Hill said.

Over the past three plus years, “we learned how effectively the Fed and the Treasury can collaborate to stand up a series of flexible, creative financial facilities to benefit America in crisis,” but there were also some issues, Hill said. 

As this commission, the Democrats on the House Select Subcommittee on the Coronavirus Crisis and others have previously raised concerns about, Yellow Corporation, a less than truckload shipping company, received 95% of the $735.9 million set aside for national security loans.  

“The CARES Act did not define the term ‘business critical to maintaining national security,’” so “Treasury had virtually unfettered authority to define this term as it wanted,” according to a report released on Tuesday, which was drafted in part when Toomey was still there. “The Treasury also created a catch-all provision that allowed it to determine that a business was critical to maintaining national security based solely on a recommendation and certification from the Secretary of Defense or the Director of National Intelligence.” 

The lack of criteria on this catch-all-provision “afforded to the Treasury, Secretary of Defense, and the Director of National Intelligence opened the door for outside parties, including lobbyists and members of Congress, to influence the process,” the report continued. “Yellow spent $570,000 on lobbying efforts in 2020 compared to zero in 2019, $80,000 in 2018 and $75,000 in 2017,” and Treasury confirmed that some members of Congress sent them letters encouraging it to give Yellow a loan. 

Additionally, the commission often found that the Defense and Treasury departments often cited number that Yellow provides 68% of less-than-truckload services to DoD wasn’t independently verified by DoD.

The report, released alongside the committee’s 38th monthly report, lists a series of recommendations if Congress were to enact a similar program down the line. 

The Treasury and Defense departments and Yellow did not respond for comment. In response to the House coronavirus’s report on the matter, last year a spokesperson for former Defense Secretary Mark Esper defended his handling of the loan and a firm representing Yellow called the allegations “baseless,” The New York Times reported. 

“Mistakes were made and we pointed those out in our reports,” said Hill.  “I hope future congresses can learn from those mistakes and make sure that they’re not repeated.”