Microloan Improvement Act of 2020

IIB 116TH CONGRESS 2D SESSION H. R. 6079 IN THE SENATE OF THE UNITED STATES SEPTEMBER 15, 2020 Received; read twice and referred to the Committee on Small Business and Entrepreneurship AN ACT To amend the Small Business Act to optimize the operations of the microloan program, lower costs for small business concerns and intermediary participants in the program, and for other purposes. Be it enacted by the Senate and House of Representa- 1 tives of the United States of America in Congress assembled, 2 VerDate Sep 11 2014 05:28 Sep 16, 2020 Jkt 099200 PO 00000 Frm 00001 Fmt 6652 Sfmt 6201 E:\BILLS\H6079.RFS H6079 kjohnson on DSK79L0C42PROD with BILLS 2 HR 6079 RFS SECTION 1. SHORT TITLE; TABLE OF CONTENTS. 1 (a) SHORT TITLE.—This Act may be cited as the 2 ‘‘Microloan Improvement Act of 2020’’. 3 (b) TABLE OF CONTENTS.—The table of contents for 4 this Act is as follows: 5 Sec. 1. Short title; table of contents. Sec. 2. Interest rate for certain intermediaries. Sec. 3. Lines of credit authorized. Sec. 4. Extended repayment terms. Sec. 5. Loan limits adjusted. Sec. 6. Program funding for microloans. Sec. 7. Technical assistance grant flexibility. Sec. 8. Credit reporting information. Sec. 9. Report regarding equitable distribution. SEC. 2. INTEREST RATE FOR CERTAIN INTERMEDIARIES. 6 Section 7(m)(3)(F)(iii) of the Small Business Act (15 7 U.S.C. 636(m)(3)(F)(iii)) is amended by striking 8 ‘‘$7,500’’ and inserting ‘‘$10,000’’. 9 SEC. 3. LINES OF CREDIT AUTHORIZED. 10 Section 7(m)(6)(A) of the Small Business Act (15 11 U.S.C. 636(m)(6)(A)) is amended by inserting ‘‘(including 12 lines of credit)’’ after ‘‘fixed rate loans’’. 13 SEC. 4. EXTENDED REPAYMENT TERMS. 14 Section 7(m)(6) of the Small Business Act (15 15 U.S.C. 636(m)(6)) is amended by adding at the end the 16 following: 17 ‘‘(F) REPAYMENT TERMS.— 18 ‘‘(i) LIMITATION ON REPAYMENTS 19 TERM.—The repayment term for a loan 20 VerDate Sep 11 2014 05:28 Sep 16, 2020 Jkt 099200 PO 00000 Frm 00002 Fmt 6652 Sfmt 6201 E:\BILLS\H6079.RFS H6079 kjohnson on DSK79L0C42PROD with BILLS 3 HR 6079 RFS made under this paragraph shall not be 1 more than— 2 ‘‘(I) in the case of a loan made 3 by an intermediary of $10,000 or less, 4 7 years; and 5 ‘‘(II) in the case of a loan made 6 by an intermediary of greater than 7 $10,000, 10 years. 8 ‘‘(ii) NO ADDITIONAL LIMITATIONS.— 9 The Administrator may not impose any ad- 10 ditional limitation on the term for repay- 11 ment of a loan made by an intermediary 12 under this paragraph.’’. 13 SEC. 5. LOAN LIMITS ADJUSTED. 14 Section 7(m)(3)(C) of the Small Business Act (15 15 U.S.C. 636(m)(3)(C)) is amended by striking ‘‘and 16 $6,000,000’’ and inserting ‘‘and $7,000,000 (in the aggre- 17 gate)’’. 18 SEC. 6. PROGRAM FUNDING FOR MICROLOANS. 19 (a) IN GENERAL.—Section 7(m) of the Small Busi- 20 ness Act (15 U.S.C. 636(m)) is amended— 21 (1) in paragraph (7)(B)— 22 (A) by amending clause (i) to read as fol- 23 lows: 24 VerDate Sep 11 2014 05:28 Sep 16, 2020 Jkt 099200 PO 00000 Frm 00003 Fmt 6652 Sfmt 6201 E:\BILLS\H6079.RFS H6079 kjohnson on DSK79L0C42PROD with BILLS 4 HR 6079 RFS ‘‘(i) ALLOCATION.—Subject to the 1 availability of appropriations and for the 2 first 2 quarters of a fiscal year, of the total 3 amount of new loan funds made available 4 for award under this subsection in such 5 fiscal year, the Administrator shall— 6 ‘‘(I) reserve 15 percent of such 7 funds for award to designated under- 8 utilized States; and 9 ‘‘(II) make the remaining 85 per- 10 cent of such funds available for award 11 in any State.’’; and 12 (B) in clause (ii), by striking ‘‘to carry 13 out’’ and all that follows through the period at 14 the end and inserting the following: ‘‘under 15 clause (i)(I) remains unexpended, the Adminis- 16 trator may make that portion available for 17 award in any State or designated underutilized 18 State.’’; and 19 (2) in paragraph (11)— 20 (A) in subparagraph (C)(ii), by striking 21 the period at the end and inserting ‘‘; and’’; 22 and 23 (B) by adding at the end the following new 24 subparagraph: 25 VerDate Sep 11 2014 05:28 Sep 16, 2020 Jkt 099200 PO 00000 Frm 00004 Fmt 6652 Sfmt 6201 E:\BILLS\H6079.RFS H6079 kjohnson on DSK79L0C42PROD with BILLS 5 HR 6079 RFS ‘‘(D) the term ‘State’ means each of the 1 several States, the District of Columbia, the 2 Commonwealth of Puerto Rico, the United 3 States Virgin Islands, Guam, the Northern 4 Mariana Islands, and American Samoa.’’. 5 (b) RULEMAKING.—Not later than 180 days after the 6 date of the enactment of this Act, the Administrator of 7 the Small Business Administration shall issue regulations 8 to define the term ‘‘designated underutilized State’’, as 9 used in section 7(m)(7)(B) of the Small Business Act (15 10 U.S.C. 636(m)(7)(B)), as added by this section. 11 SEC. 7. TECHNICAL ASSISTANCE GRANT FLEXIBILITY. 12 Section 7(m)(4) of the Small Business Act (15 13 U.S.C. 636(m)(4)) is amended— 14 (1) in subparagraph (A), by striking ‘‘subpara- 15 graph (C)’’ each place that term appears and insert- 16 ing ‘‘subparagraphs (C) and (G)’’; 17 (2) in subparagraph (C)(i)— 18 (A) by striking ‘‘subparagraph (A)’’ and 19 inserting ‘‘subparagraphs (A) and (G)’’; and 20 (B) by striking the dollar figure and in- 21 serting ‘‘$10,000’’; 22 (3) in subparagraph (D), by striking ‘‘subpara- 23 graph (A), or (C)’’ and inserting ‘‘subparagraph (A), 24 (C), or (G)’’; and 25 VerDate Sep 11 2014 05:28 Sep 16, 2020 Jkt 099200 PO 00000 Frm 00005 Fmt 6652 Sfmt 6201 E:\BILLS\H6079.RFS H6079 kjohnson on DSK79L0C42PROD with BILLS 6 HR 6079 RFS (4) by adding at the end the following: 1 ‘‘(G) GRANT AMOUNTS BASED ON APPRO- 2 PRIATIONS.—In any fiscal year in which the 3 amount appropriated to make grants under 4 subparagraph (A) is sufficient to provide to 5 each intermediary that receives a loan under 6 paragraph (1)(B)(i) a grant of not less than 25 7 percent of the total outstanding balance of 8 loans made to the intermediary under this sub- 9 section, the Administrator shall make a grant 10 under subparagraph (A) to each intermediary 11 of not less than 25 percent and not more than 12 30 percent of that total outstanding balance.’’. 13 SEC. 8. CREDIT REPORTING INFORMATION. 14 The Administrator of the Small Business Administra- 15 tion shall issue rules establishing a process under which 16 an intermediary that makes a loan to a borrower under 17 section 7(m) of the Small Business Act (15 U.S.C. 18 636(m)) shall be required to provide the major credit re- 19 porting agencies with information about the borrower rel- 20 evant to credit reporting, such as the borrower’s payment 21 activity on the loan. 22 SEC. 9. REPORT REGARDING EQUITABLE DISTRIBUTION. 23 Section 7(m)(8) of the Small Business Act (15 24 U.S.C. 636(m)(8)) is amended— 25 VerDate Sep 11 2014 05:28 Sep 16, 2020 Jkt 099200 PO 00000 Frm 00006 Fmt 6652 Sfmt 6201 E:\BILLS\H6079.RFS H6079 kjohnson on DSK79L0C42PROD with BILLS 7 HR 6079 RFS (1) by striking ‘‘In approving’’ and inserting 1 the following: 2 ‘‘(A) IN GENERAL.—In approving’’; and 3 (2) by adding at the end the following: 4 ‘‘(B) ANNUAL REPORT.—The Adminis- 5 trator shall include in the report submitted 6 under paragraph (10), and make publicly avail- 7 able on the website of the Administration, infor- 8 mation on how the Administration has met the 9 requirements of subparagraph (A).’’. 10 Passed the House of Representatives September 14, 2020. Attest: CHERYL L. JOHNSON, Clerk. VerDate Sep 11 2014 05:28 Sep 16, 2020 Jkt 099200 PO 00000 Frm 00007 Fmt 6652 Sfmt 6201 E:\BILLS\H6079.RFS H6079 kjohnson on DSK79L0C42PROD with BILLS