RESTART Act

II 116TH CONGRESS 2D SESSION S. 3814 To establish a loan program for businesses affected by COVID–19 and to extend the loan forgiveness period for paycheck protection program loans made to the hardest hit businesses, and for other purposes. IN THE SENATE OF THE UNITED STATES MAY 21, 2020 Mr. BENNET (for himself and Mr. YOUNG) introduced the following bill; which was read twice and referred to the Committee on Finance A BILL To establish a loan program for businesses affected by COVID–19 and to extend the loan forgiveness period for paycheck protection program loans made to the hard- est hit businesses, 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 ‘‘Reviving the Economy 4 Sustainably Towards A Recovery in Twenty-twenty Act’’ 5 or the ‘‘RESTART Act’’. 6 VerDate Sep 11 2014 04:35 Jun 13, 2020 Jkt 099200 PO 00000 Frm 00001 Fmt 6652 Sfmt 6201 E:\BILLS\S3814.IS S3814 kjohnson on DSK79L0C42PROD with BILLS 2 •S 3814 IS SEC. 2. EXTENSION OF COVERED PERIOD FOR LOAN FOR- 1 GIVENESS UNDER THE PAYCHECK PROTEC- 2 TION PROGRAM FOR THE HARDEST HIT BUSI- 3 NESSES. 4 Section 1106 of the CARES Act (Public Law 116– 5 136) is amended— 6 (1) by amending subsection (a)(3) to read as 7 follows: 8 ‘‘(3) the term ‘covered period’ means— 9 ‘‘(A) except as provided in subparagraph 10 (B), the 8-week period beginning on the date of 11 the origination of a covered loan; or 12 ‘‘(B) the period beginning on the date of 13 the origination of a covered loan and ending on 14 the later of the date that is 16 weeks after the 15 date of the origination of the covered loan and 16 the date that is 8 weeks after the date of enact- 17 ment of the Reviving the Economy Sustainably 18 Towards A Recovery in Twenty-twenty Act, if 19 the eligible recipient of the covered loan— 20 ‘‘(i) has less than 500 full-time equiv- 21 alent employees; and 22 ‘‘(ii) makes a good faith certification 23 to the Administrator that, during the 8- 24 week period described in subparagraph 25 (A), the eligible recipient suffered a decline 26 VerDate Sep 11 2014 04:35 Jun 13, 2020 Jkt 099200 PO 00000 Frm 00002 Fmt 6652 Sfmt 6201 E:\BILLS\S3814.IS S3814 kjohnson on DSK79L0C42PROD with BILLS 3 •S 3814 IS in gross receipts of not less than 25 per- 1 cent relative to a comparable 8-week pe- 2 riod— 3 ‘‘(I) immediately preceding 4 March 2, 2020; or 5 ‘‘(II) during 2019;’’; and 6 (2) in subsection (d)(2), by adding at the end 7 the following: 8 ‘‘(C) EXCEPTION.—This paragraph shall 9 not apply with respect to an eligible recipient 10 described in subsection (a)(3)(B).’’. 11 SEC. 3. RESTART LOAN PROGRAM. 12 (a) DEFINITIONS.—In this section: 13 (1) ADMINISTRATION; ADMINISTRATOR.—The 14 terms ‘‘Administration’’ and ‘‘Administrator’’ mean 15 the Small Business Administration and the Adminis- 16 trator thereof, respectively. 17 (2) COMMUNITY DEVELOPMENT FINANCIAL IN- 18 STITUTION.—The term ‘‘community development fi- 19 nancial institution’’ has the meaning given the term 20 in section 103 of the Riegle Community Develop- 21 ment and Regulatory Improvement Act of 1994 (12 22 U.S.C. 4702). 23 VerDate Sep 11 2014 04:35 Jun 13, 2020 Jkt 099200 PO 00000 Frm 00003 Fmt 6652 Sfmt 6201 E:\BILLS\S3814.IS S3814 kjohnson on DSK79L0C42PROD with BILLS 4 •S 3814 IS (3) COVERED LOAN.—The term ‘‘covered loan’’ 1 means a loan made under this section during the 2 covered period. 3 (4) COVERED PERIOD.—The term ‘‘covered pe- 4 riod’’ means— 5 (A) except as provided in subparagraph 6 (B), and as determined by the eligible recipient 7 of a covered loan, the 6-month period beginning 8 on— 9 (i) the date of the origination of the 10 covered loan; 11 (ii) the first day of the next scheduled 12 pay period following the date of the origi- 13 nation of the covered loan; 14 (iii) the first day of the first full 15 month following the date of the origination 16 of the covered loan; or 17 (iv) April 15, 2020; or 18 (B) with respect to an eligible recipient of 19 a covered loan that suffered a decline in gross 20 receipts of more than 80 percent in 2020 as 21 compared to 2019 or in the 6-month period be- 22 ginning on the date of the origination of the 23 covered loan as compared to a comparable pe- 24 riod in 2019, and as determined by the eligible 25 VerDate Sep 11 2014 04:35 Jun 13, 2020 Jkt 099200 PO 00000 Frm 00004 Fmt 6652 Sfmt 6201 E:\BILLS\S3814.IS S3814 kjohnson on DSK79L0C42PROD with BILLS 5 •S 3814 IS recipient of a covered loan, the 12-month period 1 beginning on— 2 (i) the date of the origination of the 3 covered loan; 4 (ii) the first day of the next scheduled 5 pay period following the date of the origi- 6 nation of the covered loan; 7 (iii) the first day of the first full 8 month following the date of the origination 9 of the covered loan; or 10 (iv) April 15, 2020. 11 (5) ELIGIBLE RECIPIENT.—The term ‘‘eligible 12 recipient’’— 13 (A) means an individual or entity that— 14 (i) is eligible to receive a loan made 15 under section 7(a)(36) of the Small Busi- 16 ness Act (15 U.S.C. 636(a)(36)); or 17 (ii) has not more than 5,000 full-time 18 employees; 19 (B) includes— 20 (i) a nonprofit organization that— 21 (I) has not more than 5,000 full- 22 time employees; and 23 VerDate Sep 11 2014 04:35 Jun 13, 2020 Jkt 099200 PO 00000 Frm 00005 Fmt 6652 Sfmt 6201 E:\BILLS\S3814.IS S3814 kjohnson on DSK79L0C42PROD with BILLS 6 •S 3814 IS (II) is not more than 50 percent 1 owned or controlled by a State, local, 2 or Tribal government; 3 (ii) a business concern that— 4 (I) deals in rare coins and 5 stamps; and 6 (II) has not more than 5,000 7 full-time employees; and 8 (iii) a business concern that leases or 9 finances equipment to other businesses, if 10 the business concern— 11 (I) has not more than 5,000 full- 12 time employees; and 13 (II) is not— 14 (aa) a mortgage lender; or 15 (bb) a lender participating 16 in the loan program under sec- 17 tion 7(a)(36) of the Small Busi- 18 ness Act (15 U.S.C. 636(a)(36)). 19 (6) MINORITY DEPOSITORY INSTITUTION.—The 20 term ‘‘minority depository institution’’ has the 21 meaning given the term in section 308 of the Finan- 22 cial Institutions Reform, Recovery, and Enforcement 23 Act of 1989 (12 U.S.C. 1463 note). 24 VerDate Sep 11 2014 04:35 Jun 13, 2020 Jkt 099200 PO 00000 Frm 00006 Fmt 6652 Sfmt 6201 E:\BILLS\S3814.IS S3814 kjohnson on DSK79L0C42PROD with BILLS 7 •S 3814 IS (7) NONPROFIT ORGANIZATION.—The term 1 ‘‘nonprofit organization’’ means an entity described 2 in paragraph (3), (5), (6), (7) (related to housing), 3 (12), (13), or (19) of section 501(c) of the Internal 4 Revenue Code and that is exempt from taxation 5 under section 501(a) of such Code. 6 (8) PAYROLL COSTS.—The term ‘‘payroll costs’’ 7 has the meaning given the term in section 8 7(a)(36)(A) of the Small Business Act (15 U.S.C. 9 636(a)(36)(A)), except that such costs shall not in- 10 clude— 11 (A) qualified wages taken into account in 12 determining the credit allowed under section 13 2301(g) of the CARES Act (Public Law 116– 14 136); or 15 (B) any payments made to an independent 16 contractor. 17 (9) SECRETARY.—The term ‘‘Secretary’’ means 18 the Secretary of the Treasury. 19 (10) UNDERSERVED BORROWER.—The term 20 ‘‘underserved borrower’’ means any business concern 21 that has traditionally had difficulty accessing fi- 22 nance, including— 23 (A) business concerns that— 24 VerDate Sep 11 2014 04:35 Jun 13, 2020 Jkt 099200 PO 00000 Frm 00007 Fmt 6652 Sfmt 6201 E:\BILLS\S3814.IS S3814 kjohnson on DSK79L0C42PROD with BILLS 8 •S 3814 IS (i) have fewer than 25 employees and 1 do not have a strong relationship with a 2 bank; 3 (ii) are owned or controlled by minori- 4 ties; 5 (iii) are owned or controlled by 6 women; 7 (iv) are owned or controlled by vet- 8 erans, including service-disabled veterans 9 (as those terms are defined in section 3(q) 10 of the Small Business Act (15 U.S.C. 11 632(q))); or 12 (v) are located in low-income and 13 rural communities, including those in areas 14 eligible for assistance under section 45D of 15 the Internal Revenue Code of 1986; and 16 (B) Tribal business concerns. 17 (b) ESTABLISHMENT.—The Administrator shall es- 18 tablish a program to guarantee loans made to eligible re- 19 cipients affected by COVID–19. 20 (c) PARTICIPATION.—In an agreement to participate 21 in a covered loan on a deferred basis, the participation 22 by the Administration shall be 100 percent. 23 (d) TERMS AND REQUIREMENTS.— 24 VerDate Sep 11 2014 04:35 Jun 13, 2020 Jkt 099200 PO 00000 Frm 00008 Fmt 6652 Sfmt 6201 E:\BILLS\S3814.IS S3814 kjohnson on DSK79L0C42PROD with BILLS 9 •S 3814 IS (1) DURATION.—Except as provided in para- 1 graph (4), the duration of a covered loan shall be for 2 not more than 7 years. 3 (2) AMOUNT.— 4 (A) IN GENERAL.—The amount of a cov- 5 ered loan made to an eligible recipient shall be 6 not more than the lesser of— 7 (i) 45 percent of the 2019 gross re- 8 ceipts of the eligible recipient; and 9 (ii) $12,000,000. 10 (B) DUPLICATION OF ASSISTANCE.— 11 (i) IN GENERAL.—An eligible recipient 12 of a covered loan shall not use proceeds of 13 the covered loan for the same expenses 14 that are covered using funds received 15 under subsection (a)(36) or (b)(2) of sec- 16 tion 7 of the Small Business Act (15 17 U.S.C. 636) or section 1110 of the 18 CARES Act (Public Law 116–136). 19 (ii) REDUCTION BASED ON OTHER 20 SBA LOANS.—The amount of a covered 21 loan for which an eligible recipient may re- 22 ceive under this section shall be reduced by 23 the amount of any assistance received by 24 the eligible recipient under subsection 25 VerDate Sep 11 2014 04:35 Jun 13, 2020 Jkt 099200 PO 00000 Frm 00009 Fmt 6652 Sfmt 6201 E:\BILLS\S3814.IS S3814 kjohnson on DSK79L0C42PROD with BILLS 10 •S 3814 IS (a)(36) or (b)(2) of section 7 of the Small 1 Business Act (15 U.S.C. 636) or section 2 1110 of the CARES Act (Public Law 116– 3 136) that is intended to be used for the al- 4 lowable expenses described in subsection 5 (g)(2) during the covered period. 6 (3) INTEREST RATE.— 7 (A) IN GENERAL.—Except as provided in 8 paragraph (4), the interest rate on a covered 9 loan shall be, as determined by the Adminis- 10 trator and the Secretary— 11 (i) for the first 2 years of the covered 12 loan, not less than 2 percent and not more 13 than 4 percent; and 14 (ii) for the third through seventh 15 years of the covered loan, the Applicable 16 Federal Rate plus 250 to 600 basis points 17 based on the decline in gross receipts of 18 the eligible recipient. 19 (B) NO PAYMENTS FOR 12 MONTHS.—No 20 payments shall be due on interest on a covered 21 loan for the first 12 months of the covered loan. 22 (4) SPECIAL PROVISIONS FOR NONPROFIT OR- 23 GANIZATIONS.—At the time of application for a cov- 24 VerDate Sep 11 2014 04:35 Jun 13, 2020 Jkt 099200 PO 00000 Frm 00010 Fmt 6652 Sfmt 6201 E:\BILLS\S3814.IS S3814 kjohnson on DSK79L0C42PROD with BILLS 11 •S 3814 IS ered loan, a nonprofit organization described in sub- 1 section (a)(5)(B) shall make an election— 2 (A) for a covered loan with a maturity of 3 not more than 10 years and an interest rate of 4 not more than 2 percent for the first 4 years 5 of a covered loan, with no eligibility for forgive- 6 ness of the covered loan under subsection (j); or 7 (B) for a covered loan with the maturity 8 and interest rate terms described in paragraphs 9 (1) and (3), respectively, with the ability to ob- 10 tain forgiveness of the covered loan if the non- 11 profit organization qualifies under subsection 12 (j)(2). 13 (5) PAYMENT DEFERRAL.— 14 (A) IN GENERAL.—No payment of prin- 15 cipal shall be due on a covered loan for the first 16 2 years of the covered loan. 17 (B) ADDITIONAL DEFERRAL.—After the 2- 18 year deferral period described in subparagraph 19 (A), the Administrator may grant not more 20 than an additional 2 years of principal deferral 21 to an eligible recipient of a covered loan if the 22 eligible recipient is certified by the Adminis- 23 trator and the Secretary as economically dis- 24 tressed based on publicly available criteria es- 25 VerDate Sep 11 2014 04:35 Jun 13, 2020 Jkt 099200 PO 00000 Frm 00011 Fmt 6652 Sfmt 6201 E:\BILLS\S3814.IS S3814 kjohnson on DSK79L0C42PROD with BILLS 12 •S 3814 IS tablished by the Administrator and the Sec- 1 retary. 2 (6) ORIGINATION FEES.— 3 (A) IN GENERAL.—The origination fee for 4 a covered loan shall be as follows: 5 (i) 3.75 percent for a covered loan of 6 not more than $100,000. 7 (ii) 3.5 percent for a covered loan of 8 more than $100,000 and not more than 9 $250,000. 10 (iii) 3.25 percent for a covered loan of 11 more than $250,000 and not more than 12 $500,000. 13 (iv) 3 percent for a covered loan of 14 more than $500,000 and not more than 15 $750,000. 16 (v) 2.75 percent for a covered loan of 17 more than $750,000 and not more than 18 $1,000,000. 19 (vi) 2.5 percent for a covered loan of 20 more than $1,000,000 and not more than 21 $1,500,000. 22 (vii) 2.25 percent for a covered loan of 23 more than $1,500,000 and not more than 24 $1,750,000. 25 VerDate Sep 11 2014 04:35 Jun 13, 2020 Jkt 099200 PO 00000 Frm 00012 Fmt 6652 Sfmt 6201 E:\BILLS\S3814.IS S3814 kjohnson on DSK79L0C42PROD with BILLS 13 •S 3814 IS (viii) 2 percent for a covered loan of 1 more than $1,750,000 and not more than 2 $2,000,000. 3 (ix) 1.75 percent for a covered loan of 4 more than $2,000,000 and not more than 5 $2,500,000. 6 (x) 1.5 percent for a covered loan of 7 more than $2,500,000 and not more than 8 $3,000,000. 9 (xi) 1.25 percent for a covered loan of 10 more than $3,000,000 and not more than 11 $3,500,000. 12 (xii) 1 percent for a covered loan of 13 more than $3,500,000 and not more than 14 $4,000,000. 15 (xiii) 0.75 percent for a covered loan 16 of more than $4,000,000 and not more 17 than $12,000,000. 18 (B) PAYMENT BY FEDERAL GOVERN- 19 MENT.—The Administrator shall— 20 (i) for any covered loan that is made 21 to an eligible recipient with not more than 22 500 full-time employees, pay the applicable 23 origination fee described in subparagraph 24 (A); and 25 VerDate Sep 11 2014 04:35 Jun 13, 2020 Jkt 099200 PO 00000 Frm 00013 Fmt 6652 Sfmt 6201 E:\BILLS\S3814.IS S3814 kjohnson on DSK79L0C42PROD with BILLS 14 •S 3814 IS (ii) for any covered loan of not more 1 than $10,000,000 that is made to an eligi- 2 ble recipient with more than 500 full-time 3 employees, pay 50 percent of the amount 4 of the applicable origination fee described 5 in subparagraph (A). 6 (C) PAYMENT BY ELIGIBLE RECIPIENT.— 7 After any applicable payments by the Adminis- 8 trator under subparagraph (B), the eligible re- 9 cipient of [Text truncated for display. Full text available on Congress.gov.]