Disaster Relief for Southeastern Small Businesses Act of 2020

II 116TH CONGRESS 2D SESSION S. 4607 To provide forgiveness for paycheck protection program and economic injury disaster loans related to COVID–19 made to businesses that are located in an area for which the President declared a major disaster related to Hurricane Laura or Hurricane Sally, and for other purposes. IN THE SENATE OF THE UNITED STATES SEPTEMBER 17, 2020 Mr. KENNEDY (for himself and Mr. JONES) introduced the following bill; which was read twice and referred to the Committee on Finance A BILL To provide forgiveness for paycheck protection program and economic injury disaster loans related to COVID–19 made to businesses that are located in an area for which the President declared a major disaster related to Hurri- cane Laura or Hurricane Sally, 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 ‘‘Disaster Relief for 4 Southeastern Small Businesses Act of 2020’’. 5 VerDate Sep 11 2014 18:03 Sep 24, 2020 Jkt 099200 PO 00000 Frm 00001 Fmt 6652 Sfmt 6201 E:\BILLS\S4607.IS S4607 pamtmann on DSKBC07HB2PROD with BILLS 2 •S 4607 IS SEC. 2. LOAN FORGIVENESS FOR BUSINESSES LOCATED IN 1 MAJOR DISASTER AREAS. 2 (a) DEFINITIONS.—In this section: 3 (1) ADMINISTRATOR.—The term ‘‘Adminis- 4 trator’’ means the Administrator of the Small Busi- 5 ness Administration. 6 (2) COVERED DISASTER.—The term ‘‘covered 7 area’’ means an area for which the President de- 8 clared a major disaster under section 401 of the 9 Robert T. Stafford Disaster Relief and Emergency 10 Assistance Act (42 U.S.C. 5170) related to Hurri- 11 cane Laura or Hurricane Sally. 12 (3) COVERED ENTITY.—The term ‘‘covered en- 13 tity’’ means any entity— 14 (A) the principal place of business of which 15 is located in a covered area; and 16 (B) that received a covered loan. 17 (4) COVERED LOAN.—The term ‘‘covered loan’’ 18 means a loan made under— 19 (A) section 7(a)(36) of the Small Business 20 Act (15 U.S.C. 636(a)(36)); or 21 (B) section 7(b)(2) of the Small Business 22 Act (15 U.S.C. 636(b)(2)) related to COVID– 23 19. 24 (b) LOAN FORGIVENESS.— 25 VerDate Sep 11 2014 18:03 Sep 24, 2020 Jkt 099200 PO 00000 Frm 00002 Fmt 6652 Sfmt 6201 E:\BILLS\S4607.IS S4607 pamtmann on DSKBC07HB2PROD with BILLS 3 •S 4607 IS (1) IN GENERAL.—Notwithstanding section 1 1106 of the CARES Act (15 U.S.C. 9005), a cov- 2 ered entity shall receive forgiveness of indebtedness 3 on a covered loan in an amount equal to the covered 4 loan amount if the covered entity submits to the 5 lender of the covered loan a one-page online or paper 6 form, to be established by the Administrator not 7 later than 7 days after the date of enactment of this 8 Act, that attests that the covered entity used the 9 covered loan proceeds for eligible activities as de- 10 scribed in paragraph (a)(36) or (b)(2) of section 7 11 of the Small Business Act (15 U.S.C. 636), as appli- 12 cable. 13 (2) REVIEW AND AUDIT.—The Administrator 14 may review and audit covered loans for which for- 15 giveness is provided to covered entities under para- 16 graph (1) using the same process used for loans 17 made under section 7(a)(36) of the Small Business 18 Act (15 U.S.C. 636(a)(36)). 19 (3) TAXABILITY.—For purposes of the Internal 20 Revenue Code of 1986— 21 (A) any amount which (but for this para- 22 graph) would be includible in gross income of 23 the covered entity by reason of forgiveness de- 24 VerDate Sep 11 2014 18:03 Sep 24, 2020 Jkt 099200 PO 00000 Frm 00003 Fmt 6652 Sfmt 6201 E:\BILLS\S4607.IS S4607 pamtmann on DSKBC07HB2PROD with BILLS 4 •S 4607 IS scribed in paragraph (1) shall be excluded from 1 gross income; and 2 (B) no deduction shall be denied or re- 3 duced, no tax attribute shall be reduced, and no 4 basis increase shall be denied, by reason of the 5 exclusion from gross income provided by sub- 6 paragraph (A). 7 (c) INAPPLICABILITY OF EIDL ADVANCE AMOUNT 8 TO PPP LOAN FORGIVENESS AMOUNT.—Notwithstanding 9 paragraph (6) of section 1110(e) of the CARES Act (15 10 U.S.C. 9009(e)), with respect to a covered entity that re- 11 ceived an advance grant under such section 1110(e), the 12 advance amount shall not be reduced from the loan for- 13 giveness amount for a loan for payroll costs made to the 14 covered entity under section 7(a)(36) of the Small Busi- 15 ness Act (15 U.S.C. 636(a)(36)). 16 (d) APPLICABILITY.—This Act shall apply with re- 17 spect to covered loans and advance grants under section 18 1110(e) of the CARES Act (15 U.S.C. 9009(e)) made to 19 a covered entity before, on, or after the date of enactment 20 of this Act. 21 Æ VerDate Sep 11 2014 18:03 Sep 24, 2020 Jkt 099200 PO 00000 Frm 00004 Fmt 6652 Sfmt 6301 E:\BILLS\S4607.IS S4607 pamtmann on DSKBC07HB2PROD with BILLS