Small Business Relief Guaranteed Loan Program Act of 2020

I 116TH CONGRESS 2D SESSION H. R. 6341 To establish a business stabilization guaranteed loan program and authority to establish a secondary market in the Small Business Administration, and for other purposes. IN THE HOUSE OF REPRESENTATIVES MARCH 23, 2020 Ms. CRAIG introduced the following bill; which was referred to the Committee on Small Business A BILL To establish a business stabilization guaranteed loan program and authority to establish a secondary market in the Small Business Administration, 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 ‘‘Small Business Relief 4 Guaranteed Loan Program Act of 2020’’. 5 SEC. 2. BUSINESS STABILIZATION GUARANTEED LOAN PRO- 6 GRAM. 7 (a) IN GENERAL.—The Administrator of the Small 8 Business Administration shall carry out a program to 9 VerDate Sep 11 2014 23:01 Apr 08, 2020 Jkt 099200 PO 00000 Frm 00001 Fmt 6652 Sfmt 6201 E:\BILLS\H6341.IH H6341 PAMTMANN on DSKBC07HB2PROD with BILLS 2 •HR 6341 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 23:01 Apr 08, 2020 Jkt 099200 PO 00000 Frm 00002 Fmt 6652 Sfmt 6201 E:\BILLS\H6341.IH H6341 PAMTMANN on DSKBC07HB2PROD with BILLS 3 •HR 6341 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 23:01 Apr 08, 2020 Jkt 099200 PO 00000 Frm 00003 Fmt 6652 Sfmt 6201 E:\BILLS\H6341.IH H6341 PAMTMANN on DSKBC07HB2PROD with BILLS 4 •HR 6341 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 23:01 Apr 08, 2020 Jkt 099200 PO 00000 Frm 00004 Fmt 6652 Sfmt 6201 E:\BILLS\H6341.IH H6341 PAMTMANN on DSKBC07HB2PROD with BILLS 5 •HR 6341 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 23:01 Apr 08, 2020 Jkt 099200 PO 00000 Frm 00005 Fmt 6652 Sfmt 6201 E:\BILLS\H6341.IH H6341 PAMTMANN on DSKBC07HB2PROD with BILLS 6 •HR 6341 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 Æ VerDate Sep 11 2014 23:01 Apr 08, 2020 Jkt 099200 PO 00000 Frm 00006 Fmt 6652 Sfmt 6301 E:\BILLS\H6341.IH H6341 PAMTMANN on DSKBC07HB2PROD with BILLS