COVID–19 Relief for Small Businesses Act of 2020

I 116TH CONGRESS 2D SESSION H. R. 6312 To provide relief from COVID–19 for small business concerns, and for other purposes. IN THE HOUSE OF REPRESENTATIVES MARCH 19, 2020 Ms. VELA´ZQUEZ introduced the following bill; which was referred to the Committee on Small Business A BILL To provide relief from COVID–19 for small business concerns, 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 SECTION 1. SHORT TITLE; TABLE OF CONTENTS. 3 (a) SHORT TITLE.—This Act may be cited as the 4 ‘‘COVID–19 Relief for Small Businesses Act of 2020’’. 5 (b) TABLE OF CONTENTS.—The table of contents for 6 this Act is as follows: 7 Sec. 1. Short title; table of contents. Sec. 2. Business stabilization direct loan program. Sec. 3. Business stabilization guaranteed loan program. Sec. 4. Economic injury grants for small business concerns. Sec. 5. Economic injury disaster loans. Sec. 6. Subsidy for certain loan payments. Sec. 7. Temporary fee reductions. VerDate Sep 11 2014 20:59 Apr 03, 2020 Jkt 099200 PO 00000 Frm 00001 Fmt 6652 Sfmt 6211 E:\BILLS\H6312.IH H6312 tkelley on DSKBCP9HB2PROD with BILLS 2 •HR 6312 IH Sec. 8. Guarantee amounts. Sec. 9. Maximum loan amount and program levels for 7(a) loans. Sec. 10. Maximum loan amount for 504 loans. Sec. 11. Recovery assistance for microbusinesses. Sec. 12. Additional leverage for small businesses affected by the COVID–19 outbreak. Sec. 13. New Markets Venture Capital Program. Sec. 14. Grants to small business development centers, women’s business cen- ters, and chapters of the Service Corps of Retired Executives. Sec. 15. Grant programs for small business development centers, women’s busi- ness centers, and chapters of the Service Corps of Retired Ex- ecutives. Sec. 16. Waiver of matching funds requirement under the women’s business center program. Sec. 17. State Trade Expansion Program. Sec. 18. Contracting and entrepreneurial development assistance. Sec. 19. Resources and services in languages other than English. Sec. 20. Authorization of appropriations for personnel. SEC. 2. BUSINESS STABILIZATION DIRECT LOAN PROGRAM. 1 (a) IN GENERAL.—The Administrator of the Small 2 Business Administration shall carry out a program to 3 make loans directly to eligible borrowers. 4 (b) ELIGIBLE BORROWER DEFINED.—In this sec- 5 tion, the term ‘‘eligible borrower’’ means a person who— 6 (1) is a small business concern as defined under 7 section 3 of the Small Business Act (15 U.S.C. 8 632); and 9 (2) is located in a State or territory of the 10 United States with a confirmed or presumed positive 11 case of COVID–19. 12 (c) USE OF FUNDS.—In addition to the use of pro- 13 ceeds currently permitted under section 7(a) of the Small 14 Business Act (15 U.S.C. 636(a)), loans made under this 15 section may be used for the following purposes: 16 VerDate Sep 11 2014 20:59 Apr 03, 2020 Jkt 099200 PO 00000 Frm 00002 Fmt 6652 Sfmt 6201 E:\BILLS\H6312.IH H6312 tkelley on DSKBCP9HB2PROD with BILLS 3 •HR 6312 IH (1) To make periodic payments of principal and 1 interest, for a period not to exceed 12 months, on 2 a loan or a loan guarantee made to an eligible bor- 3 rower that meets the eligibility standards of such 4 section 7(a). 5 (2) To provide benefits to employees of the eli- 6 gible borrower, including group life insurance, dis- 7 ability insurance, sick leave, annual leave, edu- 8 cational benefits, paid family leave, or retirement 9 benefits (including a pension plan or IRA). 10 (3) To pay wages to employees of the eligible 11 borrower, and related State and Federal payroll 12 taxes, except that loan proceeds may not be used to 13 pay amounts under a garnishment order issued by 14 an agency of a State or Federal Government. 15 (4) To provide technology, hardware, or soft- 16 ware for a shift to telework or remote work for em- 17 ployees of the eligible borrower to enable continuity 18 of operations. 19 (5) To pay rent or utilities due or owed on any 20 place of business of the eligible borrower. 21 (6) To refinance an existing debt (including in- 22 terest) in an amount not to exceed 50 percent of the 23 amount of the debt. 24 VerDate Sep 11 2014 20:59 Apr 03, 2020 Jkt 099200 PO 00000 Frm 00003 Fmt 6652 Sfmt 6201 E:\BILLS\H6312.IH H6312 tkelley on DSKBCP9HB2PROD with BILLS 4 •HR 6312 IH (7) To provide floor plan financing or other re- 1 volving line of credit. 2 (8) To pay past-due Federal, State, or local 3 payroll taxes, sales taxes, or other similar taxes that 4 are required to be collected by the eligible borrower 5 and held in trust on behalf of a Federal, State, or 6 local government entity. 7 (9) To provide employees and patrons of the eli- 8 gible borrower with the necessary items specified by 9 any public health authority to mitigate the spread of 10 COVID–19. 11 (d) LOAN TERMS.— 12 (1) AMOUNT.—Loans made under this section 13 may not exceed $2,500,000. 14 (2) DISBURSEMENT.—Not less than 10 percent, 15 but not more than 20 percent, of the proceeds of a 16 loan made under this section shall be disbursed not 17 later than 5 calendar days after a loan is approved 18 under this section. 19 (3) TERM.—Loans made under this section 20 shall be for a term of 10 years, and a borrower shall 21 not be required to repay such loan during the 12- 22 month period beginning on the date of disbursement 23 of the loan. 24 VerDate Sep 11 2014 20:59 Apr 03, 2020 Jkt 099200 PO 00000 Frm 00004 Fmt 6652 Sfmt 6201 E:\BILLS\H6312.IH H6312 tkelley on DSKBCP9HB2PROD with BILLS 5 •HR 6312 IH (4) INTEREST; FEES.—The Administrator may 1 not charge any interest or fees for a loan made 2 under this section. 3 (e) COLLATERAL.—The Administrator shall not de- 4 cline to make a loan under this section to an otherwise 5 eligible borrower due solely to inadequate collateral. The 6 Administrator shall accept any available collateral, includ- 7 ing subordinated liens, to secure a loan made under this 8 section. 9 (f) FORGIVENESS.—If an eligible borrower that re- 10 ceives loan proceeds under this section demonstrates to the 11 Administrator that the number of employees of such eligi- 12 ble borrower on December 31, 2021, is greater than or 13 equal to the number of employees of such eligible borrower 14 on December 31, 2019, the Administrator shall pay to the 15 lender of such eligible borrower’s loan not more than 50 16 percent of the outstanding principal on such loan. 17 (g) SUNSET.— 18 (1) IN GENERAL.—Except as provided in para- 19 graph (2), the Administrator of the Small Business 20 Administration may not make a loan under this sec- 21 tion after September 30, 2022. 22 (2) EXTENSION.—The Administrator may ex- 23 tend authority to make loans under this section by 24 an additional 6 months by notifying Congress, in 25 VerDate Sep 11 2014 20:59 Apr 03, 2020 Jkt 099200 PO 00000 Frm 00005 Fmt 6652 Sfmt 6201 E:\BILLS\H6312.IH H6312 tkelley on DSKBCP9HB2PROD with BILLS 6 •HR 6312 IH writing, within 10 calendar days before any exten- 1 sion. 2 (h) EMERGENCY RULEMAKING AUTHORITY.— 3 (1) IN GENERAL.—Within 15 days after the 4 date of the enactment of this section, the Adminis- 5 trator of the Small Business Administration— 6 (A) shall issue rules to carry out this sec- 7 tion; and 8 (B) may issue rules to establish a sec- 9 ondary market for loans made under this sec- 10 tion. 11 (2) NOTICE.—The notice requirements of sec- 12 tion 553(b) of title 5, United States Code shall not 13 apply to any issuance of rules under paragraph (1). 14 (i) AUTHORIZATION OF APPROPRIATIONS.—There is 15 authorized to be appropriated to the Administrator of the 16 Small Business Administration such sums as may be nec- 17 essary to pay for the cost of making $100,000,000,000 18 in direct loans under this section. In the previous sentence, 19 the cost of direct loans shall be as defined in section 502 20 of the Congressional Budget Act of 1974 (2 U.S.C. 661a). 21 SEC. 3. BUSINESS STABILIZATION GUARANTEED LOAN PRO- 22 GRAM. 23 (a) IN GENERAL.—The Administrator of the Small 24 Business Administration shall carry out a program to 25 VerDate Sep 11 2014 20:59 Apr 03, 2020 Jkt 099200 PO 00000 Frm 00006 Fmt 6652 Sfmt 6201 E:\BILLS\H6312.IH H6312 tkelley on DSKBCP9HB2PROD with BILLS 7 •HR 6312 IH guarantee loans to eligible borrowers, made by banks or 1 other lenders. 2 (b) ELIGIBLE BORROWER DEFINED.—In this sec- 3 tion, the term ‘‘eligible borrower’’ means a person who— 4 (1) is a small business concern as defined under 5 section 3 of the Small Business Act (15 U.S.C. 6 632); and 7 (2) is located in a State or territory of the 8 United States with a confirmed or presumed positive 9 case of COVID–19. 10 (c) USE OF FUNDS.—In addition to the use of pro- 11 ceeds currently permitted under section 7(a) of the Small 12 Business Act (15 U.S.C. 636(a)), loans guaranteed under 13 this section may be used for the following purposes: 14 (1) To make periodic payments of principal and 15 interest, for a period not to exceed 12 months, on 16 a loan or a loan guarantee made to an eligible bor- 17 rower that meets the eligibility standards of such 18 section 7(a). 19 (2) To provide benefits to employees of the eli- 20 gible borrower, including group life insurance, dis- 21 ability insurance, sick leave, annual leave, edu- 22 cational benefits, paid family leave, or retirement 23 benefits (including a pension plan or IRA). 24 VerDate Sep 11 2014 20:59 Apr 03, 2020 Jkt 099200 PO 00000 Frm 00007 Fmt 6652 Sfmt 6201 E:\BILLS\H6312.IH H6312 tkelley on DSKBCP9HB2PROD with BILLS 8 •HR 6312 IH (3) To pay wages to employees of the eligible 1 borrower, and related State and Federal payroll 2 taxes, except that loan proceeds may not be used to 3 pay amounts under a garnishment order issued by 4 an agency of a State or Federal Government. 5 (4) To provide technology, hardware, or soft- 6 ware for a shift to telework or remote work for em- 7 ployees of the eligible borrower to enable continuity 8 of operations. 9 (5) To pay rent or utilities due or owed on any 10 place of business of the eligible borrower. 11 (6) To refinance an existing debt (including in- 12 terest) in an amount not to exceed 50 percent of the 13 amount of the debt. 14 (7) To provide floor plan financing or other re- 15 volving line of credit. 16 (8) To pay past-due Federal, State, or local 17 payroll taxes, sales taxes, or other similar taxes that 18 are required to be collected by the eligible borrower 19 and held in trust on behalf of a Federal, State, or 20 local government entity. 21 (9) To provide employees and patrons of the eli- 22 gible borrower with the necessary items specified by 23 any public health authority to mitigate the spread of 24 COVID–19. 25 VerDate Sep 11 2014 20:59 Apr 03, 2020 Jkt 099200 PO 00000 Frm 00008 Fmt 6652 Sfmt 6201 E:\BILLS\H6312.IH H6312 tkelley on DSKBCP9HB2PROD with BILLS 9 •HR 6312 IH (d) LOAN TERMS.— 1 (1) AMOUNT.—Loans guaranteed under this 2 section may not exceed $2,500,000. 3 (2) DISBURSEMENT.—With respect to a loan 4 guaranteed under this section, loan amounts shall be 5 disbursed as follows: 6 (A) Not less than 10 percent, but not more 7 than 20 percent, of such amount shall be dis- 8 bursed not later than 5 calendar days after 9 such approval. 10 (B) Not later than 14 calendar days after 11 such approval, any remaining amounts shall be 12 disbursed. 13 (3) GUARANTEE.—Loans guaranteed under this 14 section shall be 100 percent guaranteed by the Ad- 15 ministrator of the Small Business Administration. 16 (4) INTEREST.—The Administrator and partici- 17 pating lenders shall not charge interest on any loan 18 guaranteed under this section. 19 (e) REPAYMENT.—Repayment for loans guaranteed 20 under this section— 21 (1) shall be amortized over a period of time not 22 to exceed 10 years; and 23 (2) may not begin until 12 months (which may 24 be extended by the Administrator of the Small Busi- 25 VerDate Sep 11 2014 20:59 Apr 03, 2020 Jkt 099200 PO 00000 Frm 00009 Fmt 6652 Sfmt 6201 E:\BILLS\H6312.IH H6312 tkelley on DSKBCP9HB2PROD with BILLS 10 •HR 6312 IH ness Administration) after the final disbursement of 1 loan amounts pursuant to subsection (d)(2). 2 (f) COLLATERAL.—A lender may not decline to make 3 a loan described under this section to an otherwise eligible 4 borrower due solely to inadequate collateral. The Adminis- 5 trator shall not decline to honor a guarantee on a loan 6 made by a lender that is guaranteed under this section 7 solely due to inadequate collateral. Lenders shall accept 8 any available collateral, including subordinated liens, to 9 secure a loan guaranteed under this section. 10 (g) FEES.—Neither the Administrator of the Small 11 Business Administration nor any lender may charge any 12 fees to an applicant in connection with a loan guaranteed 13 under this section. 14 (h) FORGIVENESS.—If an eligible borrower that re- 15 ceives loan proceeds under this section demonstrates to the 16 Administrator that the number of employees of such eligi- 17 ble borrower on December 31, 2021, is greater than or 18 equal to the number of employees of such eligible borrower 19 on December 31, 2019, the Administrator shall pay to the 20 lender of such eligible borrower’s loan not more than 50 21 percent of the outstanding principal on such loan. 22 (i) SUNSET.— 23 (1) IN GENERAL.—Except as provided in para- 24 graph (2), the Administrator of the Small Business 25 VerDate Sep 11 2014 20:59 Apr 03, 2020 Jkt 099200 PO 00000 Frm 00010 Fmt 6652 Sfmt 6201 E:\BILLS\H6312.IH H6312 tkelley on DSKBCP9HB2PROD with BILLS 11 •HR 6312 IH Administration may not guarantee a loan under this 1 section after September 30, 2022. 2 (2) EXTENSION.—The Administrator may ex- 3 tend authority to guarantee loans under this section 4 by an additional 6 months by notifying Congress, in 5 writing, within 10 calendar days before any exten- 6 sion. 7 (j) EMERGENCY RULEMAKING AUTHORITY.— 8 (1) IN GENERAL.—Within 15 days after the 9 date of the enactment of this section, the Adminis- 10 trator of the Small Business Administration— 11 (A) shall issue rules to carry out this sec- 12 tion; and 13 (B) may issue rules to establish a sec- 14 ondary market for loans made under this sec- 15 tion. 16 (2) NOTICE.—The notice requirements of sec- 17 tion 553(b) of title 5, United States Code shall not 18 apply to any issuance of rules under paragraph (1). 19 (k) AUTHORIZATION OF APPROPRIATIONS.—There is 20 authorized to be appropriated $100,000,000,000 to the 21 Administrator of the Small Business Administration to 22 carry out this section. 23 VerDate Sep 11 2014 20:59 Apr 03, 2020 Jkt 099200 PO 00000 Frm 00011 Fmt 6652 Sfmt 6201 E:\BILLS\H6312.IH H6312 tkelley on DSKBCP9HB2PROD with BILLS 12 •HR 6312 IH S [Text truncated for display. 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