Reinforcing Utility Restoration After Losses (RURAL) Act

I 116TH CONGRESS 2D SESSION H. R. 7680 To provide for loans to critical rural utility service providers to ensure contin- ued service and safe operation of rural utility systems during certain emergencies, and for other purposes. IN THE HOUSE OF REPRESENTATIVES JULY 20, 2020 Mr. CRAWFORD introduced the following bill; which was referred to the Committee on Agriculture A BILL To provide for loans to critical rural utility service providers to ensure continued service and safe operation of rural utility systems during certain emergencies, 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 ‘‘Reinforcing Utility 4 Restoration After Losses (RURAL) Act’’. 5 VerDate Sep 11 2014 22:49 Aug 05, 2020 Jkt 099200 PO 00000 Frm 00001 Fmt 6652 Sfmt 6201 E:\BILLS\H7680.IH H7680 kjohnson on DSK79L0C42PROD with BILLS 2 •HR 7680 IH SEC. 2. RURAL UTILITY BRIDGE LOANS. 1 (a) IN GENERAL.—Title VII of the Rural Electrifica- 2 tion Act of 1936 (7 U.S.C. 950cc–950cc-2) is amended 3 by adding at the end the following: 4 ‘‘SEC. 704. RURAL UTILITY BRIDGE LOANS. 5 ‘‘(a) LINE OF CREDIT.— 6 ‘‘(1) IN GENERAL.—The Secretary may provide 7 an eligible borrower with a line of credit from which 8 a loan may be made to replace qualified losses as a 9 result of a covered emergency. 10 ‘‘(2) AMOUNT.—The amount of the line of cred- 11 it shall be the lesser of— 12 ‘‘(A) 25 percent of the total revenue re- 13 ceived by the borrower during the 12-month pe- 14 riod ending with the day before the date of the 15 determination referred to in subsection (c)(3) 16 with respect to the covered emergency; or 17 ‘‘(B) $5,000,000. 18 ‘‘(b) LOANS.— 19 ‘‘(1) IN GENERAL.—On receipt by the Secretary 20 of documentation that the eligible borrower has a 21 qualified loss as a result of a covered emergency, the 22 Secretary shall make a loan to the borrower from 23 the line of credit in an amount equal to the lesser 24 of— 25 ‘‘(A) the qualified loss; or 26 VerDate Sep 11 2014 22:49 Aug 05, 2020 Jkt 099200 PO 00000 Frm 00002 Fmt 6652 Sfmt 6201 E:\BILLS\H7680.IH H7680 kjohnson on DSK79L0C42PROD with BILLS 3 •HR 7680 IH ‘‘(B) the unused amount of the line of 1 credit. 2 ‘‘(2) ELIGIBILITY OF QUALIFIED LOSS.— 3 ‘‘(A) IN GENERAL.—Except as provided in 4 subparagraph (B) of this paragraph, a qualified 5 loss is eligible for a loan made from the line of 6 credit if the loss is incurred not more than 180 7 days after the date of the determination re- 8 ferred to in subsection (c)(3) with respect to 9 the covered emergency. 10 ‘‘(B) AUTHORITY TO ADJUST.—The Sec- 11 retary may— 12 ‘‘(i) on request of the eligible bor- 13 rower, reduce the length of eligibility pe- 14 riod described in subparagraph (A); or 15 ‘‘(ii) on a determination that the bor- 16 rower is continuing to incur significant 17 qualified losses as a result of a covered 18 emergency, increase the length of the pe- 19 riod. 20 ‘‘(3) LOAN TERMS.— 21 ‘‘(A) NO PAYMENT REQUIRED DURING 22 EMERGENCY.—During the covered emergency, 23 interest on the loan shall not accrue, and repay- 24 VerDate Sep 11 2014 22:49 Aug 05, 2020 Jkt 099200 PO 00000 Frm 00003 Fmt 6652 Sfmt 6201 E:\BILLS\H7680.IH H7680 kjohnson on DSK79L0C42PROD with BILLS 4 •HR 7680 IH ment of principal on the loan shall not be re- 1 quired. 2 ‘‘(B) LOAN CONSOLIDATION AFTER EMER- 3 GENCY ENDS.—Unless the Secretary determines 4 that the borrower requires additional time to 5 submit documentation of qualified losses, on the 6 date that is 60 days after the eligibility period 7 described in paragraph (2) ends, the Secretary 8 shall close the line of credit, and consolidate all 9 loans made to the borrower under this section 10 with respect to the emergency into a single loan 11 with the following terms: 12 ‘‘(i) GRACE PERIOD.—During the 2- 13 year period that begins with the date the 14 consolidated loan is made, interest on the 15 consolidated loan shall not accrue, and re- 16 payment of principal on the consolidated 17 loan shall not be required. 18 ‘‘(ii) INTEREST.—Interest on the con- 19 solidated loan shall accrue at a rate of 1 20 percent per year during the 3-year period 21 that begins at the end of that 2-year pe- 22 riod. 23 ‘‘(iii) REPAYMENT PERIOD.—The loan 24 shall be repayable in full by the end of the 25 VerDate Sep 11 2014 22:49 Aug 05, 2020 Jkt 099200 PO 00000 Frm 00004 Fmt 6652 Sfmt 6201 E:\BILLS\H7680.IH H7680 kjohnson on DSK79L0C42PROD with BILLS 5 •HR 7680 IH 5-year period that begins with the date the 1 consolidated loan is made. 2 ‘‘(C) NO FEE OR PREPAYMENT PEN- 3 ALTY.—The Secretary may not impose a fee or 4 prepayment penalty with respect to any loan 5 made under this section. 6 ‘‘(4) FORGIVENESS.— 7 ‘‘(A) IN GENERAL.—Except as provided in 8 subparagraph (B), if the borrower makes one or 9 more qualified write-offs after the 1-year period 10 that begins with the date a consolidated loan is 11 made to the borrower under this section, the 12 Secretary shall forgive repayment of a portion 13 of the loan, in an amount equal to— 14 ‘‘(i) 90 percent of the first $500,000 15 of the total amount of the qualified write- 16 offs; 17 ‘‘(ii) 60 percent of the next 18 $1,000,000 of the total amount of the 19 qualified write-offs; and 20 ‘‘(iii) 30 percent of the next 21 $1,000,000 of the total amount of the 22 qualified write-offs. 23 ‘‘(B) INELIGIBILITY OF BORROWER WHO 24 INTERRUPTS SERVICE DURING EMERGENCY.— 25 VerDate Sep 11 2014 22:49 Aug 05, 2020 Jkt 099200 PO 00000 Frm 00005 Fmt 6652 Sfmt 6201 E:\BILLS\H7680.IH H7680 kjohnson on DSK79L0C42PROD with BILLS 6 •HR 7680 IH Subparagraph (A) shall not apply with respect 1 to the borrower if, during the covered emer- 2 gency, the borrower suspends or interrupts util- 3 ity service to any customer or subscriber of the 4 borrower for non-payment of an amount owed 5 to the borrower. 6 ‘‘(c) DEFINITIONS.—In this section: 7 ‘‘(1) ELIGIBLE BORROWER.—The term ‘eligible 8 borrower’ means an entity that— 9 ‘‘(A) provides electric, telecommunications, 10 clean water, waste water, or waste disposal 11 services; and 12 ‘‘(B) is eligible for assistance under— 13 ‘‘(i) section 4, 201, or 601 of the 14 Rural Electrification Act of 1936; or 15 ‘‘(ii) section 306(a) of the Consoli- 16 dated Farm and Rural Development Act. 17 ‘‘(2) QUALIFIED LOSS.— 18 ‘‘(A) IN GENERAL.—Subject to subpara- 19 graph (B), the term ‘qualified loss’ means, with 20 respect to a borrower and a covered emer- 21 gency— 22 ‘‘(i) an amount owed to the borrower 23 for services provided during the emergency, 24 which are more than 15 days past due; and 25 VerDate Sep 11 2014 22:49 Aug 05, 2020 Jkt 099200 PO 00000 Frm 00006 Fmt 6652 Sfmt 6201 E:\BILLS\H7680.IH H7680 kjohnson on DSK79L0C42PROD with BILLS 7 •HR 7680 IH ‘‘(ii) an amount not received by the 1 borrower because of reduced demand for 2 services sold by the borrower on a per-unit 3 basis, to the extent that the reduction is 4 attributable to the emergency. 5 ‘‘(B) REDUCTION.—The total amount de- 6 termined under subparagraph (A) shall be re- 7 duced by the fair market value of any assist- 8 ance received by the borrower from any source 9 while the line of credit is open, for the purpose 10 of offsetting the loss of routine operating rev- 11 enue or covering the cost of routine operating 12 expenses, during the covered emergency, exclud- 13 ing any assistance provided to repair, recover, 14 or rebuild from damage due to the emergency. 15 ‘‘(3) COVERED EMERGENCY.—The term ‘cov- 16 ered emergency’ means— 17 ‘‘(A) a major disaster or emergency, as de- 18 termined by the President under the Robert T. 19 Stafford Disaster Relief and Emergency Assist- 20 ance Act; 21 ‘‘(B) a natural disaster, as determined by 22 the Secretary of Agriculture; or 23 VerDate Sep 11 2014 22:49 Aug 05, 2020 Jkt 099200 PO 00000 Frm 00007 Fmt 6652 Sfmt 6201 E:\BILLS\H7680.IH H7680 kjohnson on DSK79L0C42PROD with BILLS 8 •HR 7680 IH ‘‘(C) an emergency involving Federal pri- 1 mary responsibility determined to exist by the 2 President under the section 501(b) of such Act. 3 ‘‘(4) QUALIFIED WRITE-OFF.—The term ‘quali- 4 fied write-off’ means, with respect to a borrower— 5 ‘‘(A) an amount described in paragraph 6 (2)(A)(i), if the borrower assigns to the Sec- 7 retary the right to any payment of the amount; 8 and 9 ‘‘(B) 90 percent of an amount described in 10 paragraph (2)(A)(ii). 11 ‘‘(d) REGULATIONS.—The Secretary may, on an ex- 12 pedited basis, prescribe such regulations as are necessary 13 to carry out the preceding provisions of this section. 14 ‘‘(e) RURAL UTILITY BRIDGE LOAN FUND.— 15 ‘‘(1) ESTABLISHMENT.—There is established in 16 the Treasury of the United States a revolving fund 17 to be known as the ‘Rural Utility Bridge Loan 18 Fund’ (in this subsection referred to as the ‘Fund’). 19 ‘‘(2) DEPOSITS AND CREDITS.—There shall be 20 deposited in, or credited to, the Fund the following: 21 ‘‘(A) All amounts appropriated to the 22 Fund. 23 ‘‘(B) All amounts paid as principal or in- 24 terest on a loan made under this section. 25 VerDate Sep 11 2014 22:49 Aug 05, 2020 Jkt 099200 PO 00000 Frm 00008 Fmt 6652 Sfmt 6201 E:\BILLS\H7680.IH H7680 kjohnson on DSK79L0C42PROD with BILLS 9 •HR 7680 IH ‘‘(C) All interest on, and proceeds from the 1 sale or redemption of, any obligations invested 2 in under paragraph (4). 3 ‘‘(3) USE OF FUNDS.— 4 ‘‘(A) IN GENERAL.—The amounts in the 5 Fund shall be available for loans under this sec- 6 tion without further appropriation. 7 ‘‘(B) ADMINISTRATIVE EXPENSES.—With 8 respect to each covered emergency, the Sec- 9 retary may use amounts in the Fund for admin- 10 istrative expenses, as follows: 11 ‘‘(i) ESTABLISHMENT OF LINES OF 12 CREDIT.—For expenses incurred in estab- 13 lishing lines of credit under this section, an 14 amount equal to 1 percent of the Fund 15 balance as of the date of the determination 16 referred to in subsection (c)(3) with re- 17 spect to the covered emergency. 18 ‘‘(ii) MAKING AND SERVICING OF 19 LOANS.—During each fiscal year, for ex- 20 penses incurred in making and servicing 21 loans (including consolidated loans) under 22 this section, an amount equal to 3 percent 23 of the average total amount of loans out- 24 standing under this section during the fis- 25 VerDate Sep 11 2014 22:49 Aug 05, 2020 Jkt 099200 PO 00000 Frm 00009 Fmt 6652 Sfmt 6201 E:\BILLS\H7680.IH H7680 kjohnson on DSK79L0C42PROD with BILLS 10 •HR 7680 IH cal year with respect to the covered emer- 1 gency. 2 ‘‘(iii) LIMITATION.—In addition, the 3 Secretary may not use more than 4 $30,000,000 during each fiscal year for 5 any administrative expense incurred in car- 6 rying out this section. 7 ‘‘(4) INVESTMENTS.— 8 ‘‘(A) IN GENERAL.—The Secretary may re- 9 quest the Secretary of the Treasury to invest 10 the portion of the Fund that is not, in the judg- 11 ment of the Secretary of Agriculture, required 12 to meet the current needs of the Fund. 13 ‘‘(B) ELIGIBLE INVESTMENTS.—On re- 14 ceipt of such a request, the Secretary of the 15 Treasury shall invest the amount involved in 16 obligations of the United States or obligations 17 that are guaranteed as to principal and interest 18 by the United States, with maturities suitable 19 to the needs of the Fund as determined by the 20 Secretary of Agriculture.’’. 21 (b) APPROPRIATION.—Out of any amounts in the 22 Treasury of the United States not otherwise appropriated, 23 there are appropriated to the Rural Utility Bridge Loan 24 Fund $5,000,000,000, without fiscal year limitation. For 25 VerDate Sep 11 2014 22:49 Aug 05, 2020 Jkt 099200 PO 00000 Frm 00010 Fmt 6652 Sfmt 6201 E:\BILLS\H7680.IH H7680 kjohnson on DSK79L0C42PROD with BILLS 11 •HR 7680 IH purposes of section 704(c)(3)(B)(i) of the Rural Elec- 1 trification Act of 1936, with respect to a covered emer- 2 gency declared in response to the COVID–19 pandemic, 3 the Fund balance is deemed to be the amount specified 4 in the preceding sentence. 5 Æ VerDate Sep 11 2014 22:49 Aug 05, 2020 Jkt 099200 PO 00000 Frm 00011 Fmt 6652 Sfmt 6301 E:\BILLS\H7680.IH H7680 kjohnson on DSK79L0C42PROD with BILLS