Increasing Access to Capital Act of 2020

I 116TH CONGRESS 2D SESSION H. R. 6303 To temporarily reduce fees for certain loans under the Small Business Admin- istration, to increase guarantee amounts on certain loans, and for other purposes. IN THE HOUSE OF REPRESENTATIVES MARCH 19, 2020 Mr. CROW introduced the following bill; which was referred to the Committee on Small Business A BILL To temporarily reduce fees for certain loans under the Small Business Administration, to increase guarantee amounts on certain loans, 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. 3 This Act may be cited as the ‘‘Increasing Access to 4 Capital Act of 2020’’. 5 SEC. 2. TEMPORARY FEE REDUCTIONS. 6 (a) PURPOSE.—The purpose of the section is to waive 7 borrower and lender fees on loans, including a permanent 8 fix to waive fees for veterans and their spouses. 9 VerDate Sep 11 2014 22:57 Mar 31, 2020 Jkt 099200 PO 00000 Frm 00001 Fmt 6652 Sfmt 6201 E:\BILLS\H6303.IH H6303 jbell on DSKJLSW7X2PROD with BILLS 2 •HR 6303 IH (b) ADMINISTRATIVE FEE WAIVER.— 1 (1) IN GENERAL.—During the period beginning 2 on the date of enactment of this Act and ending on 3 September 30, 2021, and to the extent that the cost 4 of such elimination or reduction of fees is offset by 5 appropriations, with respect to each loan guaranteed 6 under section 7(a) of the Small Business Act (15 7 U.S.C. 636(a)) (including a recipient of assistance 8 under the Community Advantage Pilot Program of 9 the Administration) for which an application is ap- 10 proved or pending approval on or after the date of 11 enactment of this Act, the Administrator shall— 12 (A) in lieu of the fee otherwise applicable 13 under section 7(a)(23)(A) of the Small Busi- 14 ness Act (15 U.S.C. 636(a)(23)(A)), collect no 15 fee or reduce fees to the maximum extent pos- 16 sible; and 17 (B) in lieu of the fee otherwise applicable 18 under section 7(a)(18)(A) of the Small Busi- 19 ness Act (15 U.S.C. 636(a)(18)(A)), collect no 20 fee or reduce fees to the maximum extent pos- 21 sible. 22 (2) APPLICATION OF FEE ELIMINATIONS OR RE- 23 DUCTIONS.—To the extent that amounts are made 24 available to the Administrator for the purpose of fee 25 VerDate Sep 11 2014 22:57 Mar 31, 2020 Jkt 099200 PO 00000 Frm 00002 Fmt 6652 Sfmt 6201 E:\BILLS\H6303.IH H6303 jbell on DSKJLSW7X2PROD with BILLS 3 •HR 6303 IH eliminations or reductions under paragraph (1), the 1 Administrator shall— 2 (A) first use any amounts provided to 3 eliminate or reduce fees paid by small business 4 borrowers under clauses (i) through (iii) of sec- 5 tion 7(a)(18)(A) of the Small Business Act (15 6 U.S.C. 636(a)(18)(A)), to the maximum extent 7 possible; and 8 (B) then use any amounts provided to 9 eliminate or reduce fees under 7(a)(23)(A) of 10 the Small Business Act (15 U.S.C. 11 636(a)(23)(A)). 12 (c) EXCEPTION TO GUARANTEE FEE WAIVER FOR 13 VETERANS.—Section 7(a)(31)(G) of the Small Business 14 Act (15 U.S.C. 636(a)(31)(G)) is amended— 15 (1) by striking clause (ii); and 16 (2) by redesignating clause (iii) as clause (ii). 17 (d) TEMPORARY FEE ELIMINATION FOR THE 504 18 LOAN PROGRAM.— 19 (1) IN GENERAL.—During the period beginning 20 on the date of enactment of this Act and ending on 21 September 30, 2021, and to the extent the cost of 22 such elimination in fees is offset by appropriations, 23 with respect to each project or loan guaranteed by 24 the Administrator pursuant to title V of the Small 25 VerDate Sep 11 2014 22:57 Mar 31, 2020 Jkt 099200 PO 00000 Frm 00003 Fmt 6652 Sfmt 6201 E:\BILLS\H6303.IH H6303 jbell on DSKJLSW7X2PROD with BILLS 4 •HR 6303 IH Business Investment Act of 1958 (15 U.S.C. 695 et 1 seq.) for which an application is approved or pending 2 approval on or after the date of enactment of this 3 Act— 4 (A) the Administrator shall, in lieu of the 5 fee otherwise applicable under section 503(d)(2) 6 of the Small Business Investment Act of 1958 7 (15 U.S.C. 697(d)(2)), collect no fee; and 8 (B) a development company shall, in lieu 9 of the processing fee under section 10 120.971(a)(1) of title 13, Code of Federal Reg- 11 ulations (relating to fees paid by borrowers), or 12 any successor thereto, collect no fee. 13 (2) REIMBURSEMENT FOR WAIVED FEES.— 14 (A) IN GENERAL.—To the extent that the 15 cost of such payments is offset by appropria- 16 tions, the Administrator shall reimburse each 17 development company that does not collect a 18 processing fee pursuant to paragraph (1)(B). 19 (B) AMOUNT.—The payment to a develop- 20 ment company under subparagraph (A) shall be 21 in an amount equal to 1.5 percent of the net 22 debenture proceeds for which the development 23 company does not collect a processing fee pur- 24 suant to paragraph (1)(B). 25 VerDate Sep 11 2014 22:57 Mar 31, 2020 Jkt 099200 PO 00000 Frm 00004 Fmt 6652 Sfmt 6201 E:\BILLS\H6303.IH H6303 jbell on DSKJLSW7X2PROD with BILLS 5 •HR 6303 IH SEC. 3. GUARANTEE AMOUNTS. 1 (a) PURPOSE.—The purpose of this section is to in- 2 crease loan guarantee amounts in order to mitigate risk 3 for lenders and keep credit flowing, including an emphasis 4 on underserved borrowers. 5 (b) 7(a) LOAN GUARANTEES.— 6 (1) IN GENERAL.—Section 7(a)(2)(A) of the 7 Small Business Act (15 U.S.C. 636(a)(2)(A)) is 8 amended by striking ‘‘), such participation by the 9 Administration shall be equal to’’ and all that fol- 10 lows through the period at the end and inserting ‘‘or 11 the Community Advantage Pilot Program of the Ad- 12 ministration), such participation by the Administra- 13 tion shall be equal to 90 percent of the balance of 14 the financing outstanding at the time of disburse- 15 ment of the loan.’’. 16 (2) TERMINATION.—Effective September 30, 17 2021, section 7(a)(2)(A) of the Small Business Act 18 (15 U.S.C. 636(a)(2)(A)), as amended by paragraph 19 (1), is amended to read as follows: 20 ‘‘(A) IN GENERAL.—Except as provided in 21 subparagraphs (B), (D), and (E), in an agree- 22 ment to participate in a loan on a deferred 23 basis under this subsection (including a loan 24 made under the Preferred Lenders Program), 25 VerDate Sep 11 2014 22:57 Mar 31, 2020 Jkt 099200 PO 00000 Frm 00005 Fmt 6652 Sfmt 6201 E:\BILLS\H6303.IH H6303 jbell on DSKJLSW7X2PROD with BILLS 6 •HR 6303 IH such participation by the Administration shall 1 be equal to— 2 ‘‘(i) 75 percent of the balance of the 3 financing outstanding at the time of dis- 4 bursement of the loan, if such balance ex- 5 ceeds $150,000; or 6 ‘‘(ii) 85 percent of the balance of the 7 financing outstanding at the time of dis- 8 bursement of the loan, if such balance is 9 less than or equal to $150,000.’’. 10 (c) EXPRESS LOAN GUARANTEE AMOUNTS AND 11 LOAN SIZE INCREASES.— 12 (1) TEMPORARY MODIFICATION.—Section 13 7(a)(31) of the Small Business Act (15 U.S.C. 14 636(a)(31)) is amended— 15 (A) in subparagraph (A)(iv), by striking 16 ‘‘with a guaranty rate of not more than 50 per- 17 cent.’’ and inserting the following: ‘‘with a 18 guarantee rate— 19 ‘‘(I) for a loan in an amount less 20 than or equal to $350,000, of not 21 more than 90 percent; and 22 ‘‘(II) for a loan in an amount 23 greater than $350,000, of not more 24 than 75 percent.’’; and 25 VerDate Sep 11 2014 22:57 Mar 31, 2020 Jkt 099200 PO 00000 Frm 00006 Fmt 6652 Sfmt 6201 E:\BILLS\H6303.IH H6303 jbell on DSKJLSW7X2PROD with BILLS 7 •HR 6303 IH (B) in subparagraph (D), by striking 1 ‘‘$350,000’’ and inserting ‘‘$1,000,000’’. 2 (2) INCREASE IN AVAILABILITY.—Effective 3 September 30, 2021, section 7(a)(31) of the Small 4 Business Act (15 U.S.C. 636(a)(31)), as amended 5 by paragraph (1), is amended— 6 (A) in subparagraph (A)(iv), by striking 7 ‘‘guarantee rate’’ and all that follows through 8 the period at the end and inserting ‘‘guarantee 9 rate of not more than 50 percent.’’; and 10 (B) in subparagraph (D), by striking 11 ‘‘$1,000,000’’ and inserting ‘‘$500,000’’. 12 SEC. 4. MAXIMUM LOAN AMOUNT AND PROGRAM LEVELS 13 FOR 7(a) LOANS. 14 (a) PURPOSE.—The purpose of this section is to tem- 15 porarily increase the maximum loan size in order to ex- 16 pand the reach of this long-term capital. 17 (b) MAXIMUM LOAN AMOUNT.—During the period 18 beginning on the date of enactment of this Act and ending 19 on September 30, 2021, with respect to any loan guaran- 20 teed under section 7(a) of the Small Business Act (15 21 U.S.C. 636(a)) for which an application is approved or 22 pending approval on or after the date of enactment of this 23 Act, the maximum loan amount shall be $10,000,000. 24 VerDate Sep 11 2014 22:57 Mar 31, 2020 Jkt 099200 PO 00000 Frm 00007 Fmt 6652 Sfmt 6201 E:\BILLS\H6303.IH H6303 jbell on DSKJLSW7X2PROD with BILLS 8 •HR 6303 IH (c) PROGRAM LEVELS.—During each of fiscal years 1 2020 and 2021, commitments for general business loans 2 authorized under section 7(a) of the Small Business Act 3 (15 U.S.C. 636(a)) shall not exceed $75,000,000,000. 4 SEC. 5. MAXIMUM LOAN AMOUNT FOR 504 LOANS. 5 (a) PURPOSE.—The purpose of this section is to 6 make refinancing of fixed assets more flexible for small 7 business concerns seeking immediate financing and relief 8 from the COVID–19 crisis. 9 (b) TEMPORARY INCREASE.—During the period be- 10 ginning on the date of enactment of this Act and ending 11 on September 30, 2021, with respect to each project or 12 loan guaranteed by the Administrator pursuant to title V 13 of the Small Business Investment Act of 1958 (15 U.S.C. 14 695 et seq.) for which an application is approved or pend- 15 ing approval on or after the date of enactment of this Act, 16 the maximum loan amount shall be $10,000,000. 17 (c) PERMANENT INCREASE FOR SMALL MANUFAC- 18 TURERS.—Effective on October 1, 2021, section 19 502(2)(A)(iii) of the Small Business Investment Act of 20 1958 (15 U.S.C. 696(2)(A)(iii)) is amended by striking 21 ‘‘$5,500,000’’ and inserting ‘‘$10,000,000’’. 22 Æ VerDate Sep 11 2014 22:57 Mar 31, 2020 Jkt 099200 PO 00000 Frm 00008 Fmt 6652 Sfmt 6301 E:\BILLS\H6303.IH H6303 jbell on DSKJLSW7X2PROD with BILLS