Federal Reserve Chairman Jerome Powell did not protest Congressional efforts to curb some of the central bank’s emergency loan programs, according to a senator at the heart of COVID relief package discussions.

“There was no effort on the part of Chairman Powell to block this or change it,” Sen. Pat Toomey (R-Penn.) told reporters Sunday morning.

The Fed declined to comment on the senator’s remarks on his discussions with Powell.

Into the weekend, Toomey spearheaded GOP efforts to prohibit the revival of several market backstops opened up by Powell and Treasury Secretary Steven Mnuchin in the midst of the pandemic.

His original proposal sought to effectively end the incoming Biden administration’s ability to resurrect the so-called liquidity facilities – and any “similar” programs – without new legislation from Congress. Mnuchin had already ordered the Fed to allow nine of its 13 crisis-response programs to close on December 31.

But overnight on Saturday, Toomey announced that he had reached a compromise with the Democrats on narrowing the scope of those limitations.

As proposed, the bill would now block the Fed from creating “clones” of three specific programs: the Municipal Liquidity Facility (loans to state and local governments), the Main Street Lending Program (loans to small and medium-sized businesses), and the Corporate Credit Facilities (liquidity for corporate debt markets).

But the concessions made will no longer subject the Term Asset-Backed Lending Facility, which backstops the securitized market for consumer credit like credit cards and student loans, to the restrictions.

Toomey also said he had conceded to narrowing the language from his original proposal to bar anything “similar” to those three targeted programs, admitting that the “Democrats made a fair point that that’s too broad.”

What’s next

Still, Fed officials have expressed in recent weeks their desire to keep the full suite of loan programs open into the new year. Former Fed Chairman Ben Bernanke said in a statement Saturday that the Fed’s “ability to respond promptly to damaging disruptions in credit markets should not be circumscribed.”

Toomey, for his part, has argued that the statutory limitations are designed to limit “permanent mission creep” at the central bank. He insisted that even under the proposal the Fed could still open new emergency programs if economic conditions worsen.

“Misuse of these programs is very, very problematic on a number of levels,” Toomey said Sunday.

The discussions have held up passage of the $900 billion package that would include a fresh round of stimulus checks, in addition to an extension of two expiring unemployment insurance programs.