HEAL Act

II 116TH CONGRESS 2D SESSION S. 4135 To provide forgivable physical disaster loans to businesses damaged due to civil unrest, and for other purposes. IN THE SENATE OF THE UNITED STATES JULY 1, 2020 Mr. TOOMEY introduced the following bill; which was read twice and referred to the Committee on Small Business and Entrepreneurship A BILL To provide forgivable physical disaster loans to businesses damaged due to civil unrest, 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 ‘‘Helping Entrepreneurs 4 Access Loans Act’’ or the ‘‘HEAL Act’’. 5 SEC. 2. FORGIVABLE BUSINESS PHYSICAL DISASTER LOANS 6 FOR DAMAGE DUE TO CIVIL UNREST. 7 (a) DEFINITIONS.—In this section— 8 VerDate Sep 11 2014 00:55 Jul 12, 2020 Jkt 099200 PO 00000 Frm 00001 Fmt 6652 Sfmt 6201 E:\BILLS\S4135.IS S4135 pbinns on DSKJLVW7X2PROD with BILLS 2 •S 4135 IS (1) the terms ‘‘Administration’’ and ‘‘Adminis- 1 trator’’ mean the Small Business Administration 2 and the Administrator thereof, respectively; 3 (2) the term ‘‘covered period’’ means the period 4 beginning on May 26, 2020 and ending on July 1, 5 2020; and 6 (3) the term ‘‘eligible entity’’ means a business 7 concern— 8 (A) with average annual receipts (as de- 9 fined in section 121.104 of title 13, Code of 10 Federal Regulations, or any successor regula- 11 tion) of not more than $2,000,000; and 12 (B) that— 13 (i) is located within an area for which 14 the Administrator declared a disaster in 15 accordance with section 123.3(a)(3) of title 16 13, Code of Federal Regulations, or any 17 successor regulation, with respect to civil 18 unrest that began on May 26, 2020 in 19 Minneapolis, Minnesota and spread across 20 the United States; and 21 (ii) incurred damage to real or per- 22 sonal property of the business concern dur- 23 ing the covered period as a result of the 24 civil unrest described in clause (i). 25 VerDate Sep 11 2014 00:55 Jul 12, 2020 Jkt 099200 PO 00000 Frm 00002 Fmt 6652 Sfmt 6201 E:\BILLS\S4135.IS S4135 pbinns on DSKJLVW7X2PROD with BILLS 3 •S 4135 IS (b) BUSINESS PHYSICAL DISASTER LOANS.— 1 (1) IN GENERAL.—Except as otherwise pro- 2 vided in this subsection, an eligible entity shall be el- 3 igible for a loan made by the Administration under 4 section 7(b)(1) of the Small Business Act (15 U.S.C. 5 636(b)(1)) under the same terms, conditions, and 6 processes as a loan made under such section to re- 7 pair, rehabilitate, or replace property, real or per- 8 sonal, of the eligible entity that was damaged or de- 9 stroyed during the covered period as a result of the 10 civil unrest described in subsection (a)(3)(B)(i). 11 (2) DISASTER DECLARATION.—With respect to 12 the disaster declaration described in subsection 13 (a)(3)(B)(i) for a loan made under paragraph (1), 14 the requirement under section 123.3(a)(3)(ii) of title 15 13, Code of Federal Regulations, or any successor 16 regulation, that 25 percent or more of the work 17 force in the area would be unemployed for not fewer 18 than 90 days shall not apply. 19 (3) LOAN AMOUNT.— 20 (A) IN GENERAL.—The amount of a loan 21 made under paragraph (1) shall be equal to 100 22 percent of the amount required to repair, reha- 23 bilitate, or replace property, real or personal, of 24 the eligible entity that— 25 VerDate Sep 11 2014 00:55 Jul 12, 2020 Jkt 099200 PO 00000 Frm 00003 Fmt 6652 Sfmt 6201 E:\BILLS\S4135.IS S4135 pbinns on DSKJLVW7X2PROD with BILLS 4 •S 4135 IS (i) was damaged or destroyed during 1 the covered period as a result of the civil 2 unrest described in subsection (a)(3)(B)(i); 3 and 4 (ii) is not compensated for by— 5 (I) insurance; 6 (II) a grant from a State or local 7 government; or 8 (III) any other means. 9 (B) DEDUCTION OF ADVANCE AMOUNT.— 10 The amount of any advance received by an eli- 11 gible entity under subsection (c) shall be de- 12 ducted from the loan amount for the eligible en- 13 tity under subparagraph (A). 14 (4) TERMS; CREDIT ELSEWHERE.— 15 (A) IN GENERAL.—With respect to a loan 16 made to an eligible entity under paragraph 17 (1)— 18 (i) the Administrator shall waive— 19 (I) any rules related the personal 20 guarantee on loans of not more than 21 $200,000 during the covered period 22 for all applicants; and 23 (II) any requirement that an ap- 24 plicant needs to be in business for the 25 VerDate Sep 11 2014 00:55 Jul 12, 2020 Jkt 099200 PO 00000 Frm 00004 Fmt 6652 Sfmt 6201 E:\BILLS\S4135.IS S4135 pbinns on DSKJLVW7X2PROD with BILLS 5 •S 4135 IS 1-year period before the civil unrest 1 described in subsection (a)(3)(B)(i), 2 except that no waiver may be made 3 for an eligible entity that was not in 4 operation on January 31, 2020; 5 (ii) the eligible entity shall not be re- 6 quired to show that the eligible entity is 7 unable to obtain credit elsewhere; and 8 (iii) no collateral shall be required for 9 the loan. 10 (B) REPAYMENT.—Any payments on a 11 loan made to an eligible entity under paragraph 12 (1) are deferred until June 30, 2022, and inter- 13 est shall not begin to accrue until such date. 14 (5) APPLICATION.— 15 (A) IN GENERAL.—Not later than 7 days 16 after the date of enactment of this Act, the Ad- 17 ministrator shall begin to accept applications 18 for a loan under paragraph (1). 19 (B) DEADLINE.—An eligible entity desir- 20 ing a loan under this subsection shall submit to 21 the Administrator an application not later than 22 December 31, 2020. 23 VerDate Sep 11 2014 00:55 Jul 12, 2020 Jkt 099200 PO 00000 Frm 00005 Fmt 6652 Sfmt 6201 E:\BILLS\S4135.IS S4135 pbinns on DSKJLVW7X2PROD with BILLS 6 •S 4135 IS (C) APPROVAL AND ABILITY TO REPAY.— 1 With respect to an applicant for a loan made 2 under paragraph (1), the Administrator may— 3 (i) approve the applicant based on the 4 credit score or personal guarantee of the 5 applicant; or 6 (ii) use alternative appropriate meth- 7 ods to determine the applicant’s ability to 8 repay. 9 (6) USE OF FUNDS.—A recipient of a loan 10 made under paragraph (1) shall use the loan pro- 11 ceeds to repair, rehabilitate, or replace property, real 12 or personal, damaged or destroyed during the cov- 13 ered period as a result of the civil unrest described 14 in subsection (a)(3)(B)(i), provided that such dam- 15 age or destruction is not compensated for by insur- 16 ance, a grant from a State or local government, or 17 otherwise. 18 (7) LOAN FORGIVENESS.— 19 (A) IN GENERAL.—An eligible entity that 20 received a loan made under paragraph (1), or 21 an eligible entity that received a loan under sec- 22 tion 7(b)(1) of the Small Business Act (15 23 U.S.C. 636(b)(1)) before the date of enactment 24 of this Act related to the civil unrest described 25 VerDate Sep 11 2014 00:55 Jul 12, 2020 Jkt 099200 PO 00000 Frm 00006 Fmt 6652 Sfmt 6201 E:\BILLS\S4135.IS S4135 pbinns on DSKJLVW7X2PROD with BILLS 7 •S 4135 IS in subsection (a)(3)(B)(i), shall be eligible for 1 forgiveness of indebtedness equal to 75 percent 2 of the loan amount if the eligible entity— 3 (i) submits to the Administrator docu- 4 mentation of sales for 2019 and 2020 and 5 tax returns for 2019 and 2020; and 6 (ii) the eligible entity is in operation 7 as of December 31, 2021. 8 (B) AMOUNTS NOT FORGIVEN.—Any re- 9 maining amount of a loan described in subpara- 10 graph (A) that is not forgiven under this para- 11 graph as of December 31, 2021 shall— 12 (i) be considered a loan made under 13 section 7(b)(1) of the Small Business Act 14 (15 U.S.C. 636(b)(1)); 15 (ii) bear an interest rate of 3.75 per- 16 cent; and 17 (iii) have a 30-year term. 18 (8) DUPLICATION.—An eligible entity that re- 19 ceived a loan under subsection (a)(36) or (b)(2) of 20 section 7 of the Small Business Act (15 U.S.C. 636) 21 before the date of enactment of this Act shall be eli- 22 gible for a loan under paragraph (1) if the proceeds 23 of the loan made under such subsection (a)(36) or 24 VerDate Sep 11 2014 00:55 Jul 12, 2020 Jkt 099200 PO 00000 Frm 00007 Fmt 6652 Sfmt 6201 E:\BILLS\S4135.IS S4135 pbinns on DSKJLVW7X2PROD with BILLS 8 •S 4135 IS (b)(2) are not used for the same expenses as the 1 loan under paragraph (1). 2 (c) EMERGENCY GRANT.— 3 (1) IN GENERAL.—An eligible entity that ap- 4 plies for a loan under subsection (b)(1) may request 5 that the Administrator provide an advance, subject 6 to paragraph (3), to the eligible entity not later than 7 10 days after the date on which the Administrator 8 receives an application from the eligible entity. 9 (2) VERIFICATION.—Before disbursing amounts 10 under this subsection, the Administrator shall verify 11 that the applicant is an eligible entity by accepting 12 a self-certification from the applicant under penalty 13 of perjury pursuant to section 1746 of title 28, 14 United States Code. 15 (3) AMOUNT.—The amount of an advance pro- 16 vided to an eligible entity under this subsection shall 17 be the lesser of— 18 (A) 20 percent of the amount requested by 19 the eligible entity; or 20 (B) $10,000. 21 (4) USE OF FUNDS.—An advance received 22 under this subsection shall only be used for the al- 23 lowable uses for a loan under subsection (b)(1). 24 (5) REPAYMENT.— 25 VerDate Sep 11 2014 00:55 Jul 12, 2020 Jkt 099200 PO 00000 Frm 00008 Fmt 6652 Sfmt 6201 E:\BILLS\S4135.IS S4135 pbinns on DSKJLVW7X2PROD with BILLS 9 •S 4135 IS (A) IN GENERAL.—Except as provided 1 under subparagraph (B), an eligible entity that 2 receives an advance under this subsection shall 3 not be required to repay any amounts of the ad- 4 vance. 5 (B) RETURN OF ADVANCE.—If an appli- 6 cant for a loan under subsection (b)(1) is later 7 determined to be ineligible for the loan because 8 the applicant does not meet the requirements to 9 be an eligible entity described in subsection 10 (a)(3), the applicant shall return to the Admin- 11 istrator any advance amount provided under 12 this subsection— 13 (i) not later than 90 days after receiv- 14 ing notice of the determination of ineligi- 15 bility; or 16 (ii) if the Administrator determines 17 that the applicant submitted the applica- 18 tion in bad faith, not later than 30 days 19 after receiving notice of that determina- 20 tion, plus interest in an amount equal to 21 4.75 percent of the advance. 22 (d) RESOURCES AND SERVICES IN LANGUAGES 23 OTHER THAN ENGLISH.—The Administrator shall pro- 24 vide the resources and services made available by the Ad- 25 VerDate Sep 11 2014 00:55 Jul 12, 2020 Jkt 099200 PO 00000 Frm 00009 Fmt 6652 Sfmt 6201 E:\BILLS\S4135.IS S4135 pbinns on DSKJLVW7X2PROD with BILLS 10 •S 4135 IS ministration relating to the loans and grants available 1 under this section to eligible entities in the 10 most com- 2 monly spoken languages, other than English, in the 3 United States, which shall include Mandarin, Cantonese, 4 Japanese, and Korean. 5 (e) REGULATIONS.—The Administrator shall issue 6 guidance and rules to carry out this section. 7 (f) DIRECT APPROPRIATION.— 8 (1) IN GENERAL.—There is appropriated, out 9 of amounts in the Treasury not otherwise appro- 10 priated, for the fiscal year ending September 30, 11 2020, for an additional amount for ‘‘Small Business 12 Administration—HEAL Act’’, $80,000,000, to re- 13 main available until September 30, 2021, for car- 14 rying out this section. 15 (2) EMERGENCY DESIGNATION.— 16 (A) IN GENERAL.—The amounts provided 17 under this subsection are designated as an 18 emergency requirement pursuant to section 4(g) 19 of the Statutory Pay-As-You-Go Act of 2010 (2 20 U.S.C. 933(g)). 21 (B) DESIGNATION IN SENATE.—In the 22 Senate, this subsection is designated as an 23 emergency requirement pursuant to section 24 4112(a) of H. Con. Res. 71 (115th Congress), 25 VerDate Sep 11 2014 00:55 Jul 12, 2020 Jkt 099200 PO 00000 Frm 00010 Fmt 6652 Sfmt 6201 E:\BILLS\S4135.IS S4135 pbinns on DSKJLVW7X2PROD with BILLS 11 •S 4135 IS the concurrent resolution on the budget for fis- 1 cal year 2018. 2 Æ VerDate Sep 11 2014 00:55 Jul 12, 2020 Jkt 099200 PO 00000 Frm 00011 Fmt 6652 Sfmt 6301 E:\BILLS\S4135.IS S4135 pbinns on DSKJLVW7X2PROD with BILLS