Paycheck Protection Small Business Forgiveness Act

I 116TH CONGRESS 2D SESSION H. R. 7777 To provide automatic forgiveness for paycheck protection program loans under $150,000, and for other purposes. IN THE HOUSE OF REPRESENTATIVES JULY 24, 2020 Ms. HOULAHAN (for herself, Mr. UPTON, Mr. FLORES, Mr. FITZPATRICK, Mr. WELCH, Mr. KUSTOFF of Tennessee, Mr. PALAZZO, Mr. EVANS, Mr. CARTER of Texas, Mr. ROUDA, Mr. BARR, Mr. FERGUSON, Mr. GUEST, Mr. BUDD, Mr. WILSON of South Carolina, Mr. WILLIAMS, Mr. LUCAS, Mr. COOPER, Mr. MCCAUL, Mr. DAVID P. ROE of Tennessee, Mr. THOMPSON of Mississippi, Mr. BALDERSON, Mr. GIBBS, Mr. CURTIS, Mr. BISHOP of North Carolina, and Mr. ROY) introduced the following bill; which was referred to the Committee on Small Business A BILL To provide automatic forgiveness for paycheck protection program loans under $150,000, 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 ‘‘Paycheck Protection 4 Small Business Forgiveness Act’’. 5 VerDate Sep 11 2014 18:50 Aug 15, 2020 Jkt 099200 PO 00000 Frm 00001 Fmt 6652 Sfmt 6201 E:\BILLS\H7777.IH H7777 pamtmann on DSKBC07HB2PROD with BILLS 2 •HR 7777 IH SEC. 2. LOAN FORGIVENESS FOR PPP LOANS UNDER 1 $150,000. 2 Section 1106 of the CARES Act (Public Law 116– 3 136) is amended— 4 (1) in subsection (e), in the matter preceding 5 paragraph (1), by striking ‘‘An eligible’’ and insert- 6 ing ‘‘Except as provided in subsection (m), an eligi- 7 ble’’; 8 (2) in subsection (f), by inserting ‘‘or the infor- 9 mation required under subsection (m), as applica- 10 ble’’ after ‘‘subsection (e)’’; 11 (3) by striking subsection (h) and inserting the 12 following: 13 ‘‘(h) HOLD HARMLESS.— 14 ‘‘(1) IN GENERAL.—A lender may rely on all 15 certifications and documentation submitted by an 16 applicant or eligible recipient pursuant to any re- 17 quirement in statute regarding covered loans, or 18 rules or guidance promulgated to carry out any ac- 19 tion relating to covered loans, from an applicant or 20 eligible recipient attesting that the applicant or eligi- 21 ble recipient has accurately verified all documenta- 22 tion provided to the lender. 23 ‘‘(2) NO ENFORCEMENT ACTION.—With respect 24 to a lender that relies on the certifications and docu- 25 mentation described in paragraph (1)— 26 VerDate Sep 11 2014 18:50 Aug 15, 2020 Jkt 099200 PO 00000 Frm 00002 Fmt 6652 Sfmt 6201 E:\BILLS\H7777.IH H7777 pamtmann on DSKBC07HB2PROD with BILLS 3 •HR 7777 IH ‘‘(A) no enforcement or other action may 1 be taken against the lender relating to loan 2 origination, forgiveness, or guarantee based on 3 such reliance, including claims under— 4 ‘‘(i) the Small Business Act (15 5 U.S.C. 631 et seq.); 6 ‘‘(ii) sections 3729 through 3733 of 7 title 31, United States Code (commonly 8 known as the ‘False Claims Act’); 9 ‘‘(iii) the Financial Institutions Re- 10 form, Recovery, and Enforcement Act 11 (Public Law 101–73); 12 ‘‘(iv) section 21 of the Federal De- 13 posit Insurance Act (12 U.S.C. 1829b), 14 chapter 2 of title I of Public Law 91–508 15 (12 U.S.C. 1951 et seq.), and subchapter 16 II of chapter 53 of title 31, United States 17 Code (collectively known as the ‘Bank Se- 18 crecy Act’); or 19 ‘‘(v) any other Federal, State, or 20 other criminal or civil law or regulation; 21 and 22 ‘‘(B) the lender shall not be subject to any 23 penalties relating to loan origination, forgive- 24 VerDate Sep 11 2014 18:50 Aug 15, 2020 Jkt 099200 PO 00000 Frm 00003 Fmt 6652 Sfmt 6201 E:\BILLS\H7777.IH H7777 pamtmann on DSKBC07HB2PROD with BILLS 4 •HR 7777 IH ness, or guarantee based on such reliance.’’; 1 and 2 (4) by adding at the end the following: 3 ‘‘(m) FORGIVENESS FOR COVERED LOANS UNDER 4 $150,000.— 5 ‘‘(1) IN GENERAL.—Notwithstanding subsection 6 (e), with respect to a covered loan made to an eligi- 7 ble recipient that is not more than $150,000, the 8 covered loan amount shall be forgiven under this 9 section if the eligible recipient submits to the lender 10 a one-page online or paper form, to be established 11 by the Administrator, that attests that the eligible 12 recipient complied with the requirements under sec- 13 tion 7(a)(36) of the Small Business Act (15 U.S.C. 14 636(a)(36)). Covered individuals (defined under sec- 15 tion 4019 of this Act) are not eligible for forgiveness 16 under this subsection. 17 ‘‘(2) HOLD HARMLESS.—With respect to a 18 lender that relies on an attestation submitted by an 19 eligible recipient under paragraph (1), no enforce- 20 ment action may be taken against the lender for any 21 falsehoods contained in the attestation. 22 ‘‘(3) DEMOGRAPHIC INFORMATION.—The online 23 or paper form established by the Administrator 24 under paragraph (1) shall include a means by which 25 VerDate Sep 11 2014 18:50 Aug 15, 2020 Jkt 099200 PO 00000 Frm 00004 Fmt 6652 Sfmt 6201 E:\BILLS\H7777.IH H7777 pamtmann on DSKBC07HB2PROD with BILLS 5 •HR 7777 IH an eligible recipient may, at the discretion of the eli- 1 gible recipient, submit demographic information of 2 the owner of the eligible recipient, including the sex, 3 race, ethnicity, and veteran status of the owner. 4 ‘‘(4) EXPENDITURE INFORMATION.—The form 5 established by the Administrator under paragraph 6 (1) shall include a process by which an eligible re- 7 cipient may elect to submit information about the 8 use of the covered loan, including indication of 9 whether the eligible recipient— 10 ‘‘(A) used 60 percent or more of the cov- 11 ered loan amount for payroll costs as defined in 12 section 7(a)(36) of the Small Business Act (15 13 U.S.C. 636(a)(36)); 14 ‘‘(B) used less than 60 percent of the cov- 15 ered loan amount for payroll costs but is able 16 to document an inability to hire or rehire em- 17 ployees as described under subsection (d)(7)(A); 18 or 19 ‘‘(C) used less than 60 percent of the cov- 20 ered loan amount for payroll costs but is able 21 to document an inability to return to the same 22 level of business activity as described under 23 subsection (d)(7)(B). 24 VerDate Sep 11 2014 18:50 Aug 15, 2020 Jkt 099200 PO 00000 Frm 00005 Fmt 6652 Sfmt 6201 E:\BILLS\H7777.IH H7777 pamtmann on DSKBC07HB2PROD with BILLS 6 •HR 7777 IH ‘‘(n) ENFORCEMENT ACTION AGAINST BOR- 1 ROWERS.—An eligible recipient of a covered loan may only 2 be subject to an enforcement action or penalty relating 3 to loan origination, forgiveness, or guarantee of the cov- 4 ered loan if the eligible recipient commits fraud or expends 5 covered loan proceeds on expenses that are not allowable 6 under section 7(a)(36)(F) of the Small Business Act (15 7 U.S.C. 636(a)(36)(F)).’’. 8 Æ VerDate Sep 11 2014 18:50 Aug 15, 2020 Jkt 099200 PO 00000 Frm 00006 Fmt 6652 Sfmt 6301 E:\BILLS\H7777.IH H7777 pamtmann on DSKBC07HB2PROD with BILLS