Federal Register / Vol. 85, No. 86 / Monday, May 4, 2020 / Rules and Regulations 26321 

13 12 CFR 1026.19(e)(3). As a general rule, an 

estimated closing cost disclosed on the Loan 

Estimate pursuant to § 1026.19(e)(1)(i) is in good 

faith if the charge paid by or imposed on the 

consumer does not exceed the amount originally 

disclosed. 12 CFR 1026.19(e)(3)(i). For certain 

categories of settlement charges, good faith is 

determined with reference to whether: (1) The 

aggregate amount of certain charges paid by or 

imposed on the consumer does not exceed the 

aggregate amount of those charges disclosed 

pursuant to § 1026.19(e)(1)(i) by more than 10 

percent (see 12 CFR 1026.19(e)(3)(ii)(A)); or (2) the 

charge was estimated consistent with the best 

information reasonably available at the time it was 

disclosed, regardless of whether the final amount 

exceeds the estimated amount (see 12 CFR 

1026.19(e)(3)(iii)). 

14 12 CFR 1026.19(e)(3)(iv); 12 CFR 

1026.19(e)(4)(i). Under § 1026.19(e)(4)(i), the 

revised estimates must be reflected on a revised 

version of the Loan Estimate, on the Closing 

Disclosure, or on a corrected Closing Disclosure. 

15 12 CFR 1026.19(e)(3)(iv)(A). 

16 12 CFR 1026.19(e)(3)(iv)(A)(1); comment 

19(e)(3)(iv)(A)–2. 

17See id.; 12 CFR 1026.19(e)(4)(i). As noted 

above, the revised estimates must be reflected on a 

revised version of the Loan Estimate, on the Closing 

Disclosure, or on a corrected Closing Disclosure. 12 

CFR 1026.19(e)(4)(i). See also 12 CFR 1024.2(b) 

(definition of ‘‘Changed circumstances’’ in 

Regulation X, which predates the TRID Rule 

changed circumstance definition, includes ‘‘Acts of 

God, war, disaster, or other emergency’’). 

18 12 U.S.C. 5512(b)(1). The relevant provisions of 

TILA and Regulation Z form part of Federal 

consumer financial law. See 12 U.S.C. 5481(12)(O), 

(14). 

19 15 U.S.C. 1640(f). 

20 5 U.S.C. 553(d). 

21 5 U.S.C. 553(b). 

22 5 U.S.C. 603(a), 604(a). 

23 44 U.S.C. 3501 et seq. 

24 5 U.S.C. 801 et seq. 

with their mortgage transaction and 

disclose them on the Loan Estimate.13

For purposes of determining good faith 

under the TRID Rule, creditors may use 

revised estimates of such costs in a 

limited number of situations pursuant to 

Regulation Z, § 1026.19(e)(3)(iv).14 One 

such situation is if there are ‘‘changed 

circumstances’’ that affect the 

settlement charges consumers would 

incur.15 The TRID Rule specifies that 

changed circumstances includes ‘‘an 

extraordinary event beyond the control 

of any interested party,’’ with the 

commentary to the TRID Rule clarifying 

that a ‘‘war or natural disaster’’ is an 

example of such an extraordinary 

event.16

Economic disruptions and shortages 

during the COVID–19 pandemic may 

affect the ability of stakeholders to 

provide accurate estimates of some 

settlement charges. Stakeholders have 

sought guidance from the Bureau as to 

whether the COVID–19 pandemic is an 

extraordinary event that permits 

creditors to provide consumers with 

revised estimates reflecting changes in 

settlement charges. For example, a 

stakeholder asked to clarify whether, for 

purposes of establishing good faith, a 

creditor could provide a revised 

estimate of the appraisal fee based on 

changed circumstances where (1) the 

amount disclosed on the Loan Estimate 

was based on a reasonable market price 

at the time of the estimate and (2) the 

actual appraisal fee was higher because 

of a shortage of available appraisers due 

to the effects of the COVID–19 

pandemic. Upon consideration of the 

interpretive issues, the Bureau 

concludes that, as with wars or natural 

disasters, the COVID–19 pandemic is an 

example of an extraordinary event 

beyond the control of any interested 

party, and thus is a changed 

circumstance. Accordingly, for purposes 

of determining good faith, creditors may 

use revised estimates of settlement 

charges that consumers would incur in 

connection with the mortgage 

transaction if the COVID–19 pandemic 

has affected the estimate of such 

settlement charges.17

3. Legal Authority and TILA Safe Harbor 

Provisions 

The Bureau is issuing this interpretive 

rule based on its authority to interpret 

TILA and Regulation Z, including under 

section 1022(b)(1) of the Dodd-Frank 

Act, which authorizes guidance as may 

be necessary or appropriate to enable 

the Bureau to administer and carry out 

the purposes and objectives of the 

Federal consumer financial laws.18

By operation of TILA section 130(f), 

no provision of TILA sections 108(b), 

108(c), 108(e), 112, or 130 imposing any 

liability applies to any act done or 

omitted in good faith in conformity with 

this interpretive rule, notwithstanding 

that after such act or omission has 

occurred, this interpretive rule is 

amended, rescinded, or determined by 

judicial or other authority to be invalid 

for any reason.19

II. Effective Date 

Because this rule is solely 

interpretive, it is not subject to the 30- 

day delayed effective date for 

substantive rules under section 553(d) 

of the Administrative Procedure Act.20

Therefore, this rule is effective on May 

4, 2020, the same date that it is 

published in the Federal Register. 

III. Regulatory Requirements 

This rule articulates the Bureau’s 

interpretation of Regulation Z and TILA. 

As an interpretive rule, it is exempt 

from the notice-and-comment 

rulemaking requirements of the 

Administrative Procedure Act.21

Because no notice of proposed 

rulemaking is required, the Regulatory 

Flexibility Act does not require an 

initial or final regulatory flexibility 

analysis.22

The Bureau has determined that this 

interpretive rule does not impose any 

new or revise any existing 

recordkeeping, reporting, or disclosure 

requirements on covered entities or 

members of the public that would be 

collections of information requiring 

OMB approval under the Paperwork 

Reduction Act.23

IV. Congressional Review Act 

Pursuant to the Congressional Review 

Act,24 the Bureau will submit a report 

containing this interpretive rule and 

other required information to the United 

States Senate, the United States House 

of Representatives, and the Comptroller 

General of the United States prior to the 

rule’s published effective date. The 

Office of Information and Regulatory 

Affairs has designated this interpretive 

rule as not a ‘‘major rule’’ as defined by 

5 U.S.C. 804(2). 

V. Signing Authority 

The Director of the Bureau, having 

reviewed and approved this document, 

is delegating the authority to 

electronically sign this document to 

Laura Galban, a Bureau Federal Register 

Liaison, for purposes of publication in 

the Federal Register. 

Dated: April 29, 2020. 

Laura Galban, 

Federal Register Liaison, Bureau of Consumer 

Financial Protection. 

[FR Doc. 2020–09515 Filed 5–1–20; 8:45 am] 

BILLING CODE 4810–AM–P 

SMALL BUSINESS ADMINISTRATION 

13 CFR Part 120 

[Docket Number SBA–2020–0022] 

RIN 3245–AH38 

Business Loan Program Temporary 

Changes; Paycheck Protection 

Program—Requirements— 

Disbursements 

AGENCY: U. S. Small Business 

Administration. 

ACTION: Interim final rule. 

SUMMARY: On April 2, 2020, the U.S. 

Small Business Administration (SBA) 

posted an interim final rule (the First 

PPP Interim Final Rule) announcing the 

implementation of the Coronavirus Aid, 

Relief, and Economic Security Act 

(CARES Act or the Act). The Act 


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26322 Federal Register / Vol. 85, No. 86 / Monday, May 4, 2020 / Rules and Regulations 

1 If the tenth calendar day is a Saturday, Sunday, 

or legal holiday, the period continues to run until 

the end of the next business day. 

temporarily adds a new program, titled 

the ‘‘Paycheck Protection Program,’’ to 

the SBA’s 7(a) Loan Program. The Act 

also provides for forgiveness of up to the 

full principal amount of qualifying 

loans guaranteed under the Paycheck 

Protection Program (PPP). The PPP is 

intended to provide economic relief to 

small businesses nationwide adversely 

impacted by the Coronavirus Disease 

2019 (COVID–19). SBA posted 

additional interim final rules on April 3, 

2020, April 14, 2020, and April 24, 

2020. This interim final rule 

supplements the previously posted 

interim final rules with additional 

guidance. This interim final rule 

supplements SBA’s implementation of 

the Act and requests public comment. 

DATES: 

Effective date: This rule is effective 

May 4, 2020. 

Applicability date: This interim final 

rule applies to applications submitted 

under the Paycheck Protection Program 

through June 30, 2020, or until funds 

made available for this purpose are 

exhausted. 

Comment date: Comments must be 

received on or before June 3, 2020. 

ADDRESSES: You may submit comments, 

identified by number SBA–2020–0022, 

through the Federal eRulemaking Portal: 

http://www.regulations.gov. Follow the 

instructions for submitting comments. 

SBA will post all comments on 

www.regulations.gov. If you wish to 

submit confidential business 

information (CBI) as defined in the User 

Notice at www.regulations.gov, please 

send an email to ppp-ifr@sba.gov. 

Highlight the information that you 

consider to be CBI and explain why you 

believe SBA should hold this 

information as confidential. SBA will 

review the information and make the 

final determination whether it will 

publish the information. 

FOR FURTHER INFORMATION CONTACT: A 

Call Center Representative at 833–572– 

0502, or the local SBA Field Office; the 

list of offices can be found at https://

www.sba.gov/tools/local-assistance/ 

districtoffices. 

SUPPLEMENTARY INFORMATION: 

I. Background Information 

On March 13, 2020, President Trump 

declared the ongoing Coronavirus 

Disease 2019 (COVID–19) pandemic of 

sufficient severity and magnitude to 

warrant an emergency declaration for all 

States, territories, and the District of 

Columbia. With the COVID–19 

emergency, many small businesses 

nationwide are experiencing economic 

hardship as a direct result of the 

Federal, State, tribal, and local public 

health measures that are being taken to 

minimize the public’s exposure to the 

virus. These measures, some of which 

are government-mandated, are being 

implemented nationwide and include 

the closures of restaurants, bars, and 

gyms. In addition, based on the advice 

of public health officials, other 

measures, such as keeping a safe 

distance from others or even stay-athome orders, are being implemented, 

resulting in a dramatic decrease in 

economic activity as the public avoids 

malls, retail stores, and other 

businesses. 

On March 27, 2020, the President 

signed the Coronavirus Aid, Relief, and 

Economic Security Act (the CARES Act 

or the Act) (Pub. L. 116–136) to provide 

emergency assistance and health care 

response for individuals, families, and 

businesses affected by the coronavirus 

pandemic. The Small Business 

Administration (SBA) received funding 

and authority through the Act to modify 

existing loan programs and establish a 

new loan program to assist small 

businesses nationwide adversely 

impacted by the COVID–19 emergency. 

Section 1102 of the Act temporarily 

permits SBA to guarantee 100 percent of 

7(a) loans under a new program titled 

the ‘‘Paycheck Protection Program.’’ 

Section 1106 of the Act provides for 

forgiveness of up to the full principal 

amount of qualifying loans guaranteed 

under the Paycheck Protection Program. 

On April 24, 2020, the President signed 

the Paycheck Protection Program and 

Health Care Enhancement Act (Pub. L. 

116–139), which provided additional 

funding and authority for the Paycheck 

Protection Program. 

II. Comments and Immediate Effective 

Date 

The intent of the Act is that SBA 

provide relief to America’s small 

businesses expeditiously. This intent, 

along with the dramatic decrease in 

economic activity nationwide, provides 

good cause for SBA to dispense with the 

30-day delayed effective date provided 

in the Administrative Procedure Act. 

Specifically, it is critical to meet 

lenders’ and borrowers’ need for clarity 

concerning program requirements as 

rapidly as possible because the last day 

eligible borrowers can apply for and 

receive a loan is June 30, 2020. 

This interim final rule supplements 

previous regulations and guidance on 

several important, discrete issues. The 

immediate effective date of this interim 

final rule will benefit lenders so that 

they can swiftly close and disburse 

loans to small businesses. This interim 

final rule is effective without advance 

notice and public comment because 

section 1114 of the Act authorizes SBA 

to issue regulations to implement Title 

I of the Act without regard to notice 

requirements. This rule is being issued 

to allow for immediate implementation 

of this program. Although this interim 

final rule is effective immediately, 

comments are solicited from interested 

members of the public on all aspects of 

the interim final rule, including section 

III below. These comments must be 

submitted on or before June 3, 2020. 

SBA will consider these comments and 

the need for making any revisions as a 

result of these comments. 

III. Paycheck Protection Program 

Requirements for Disbursements 

Overview 

The CARES Act was enacted to 

provide immediate assistance to 

individuals, families, and organizations 

affected by the COVID–19 emergency. 

Among the provisions contained in the 

CARES Act are provisions authorizing 

SBA to temporarily guarantee loans 

under the Paycheck Protection Program 

(PPP). Loans under the PPP will be 100 

percent guaranteed by SBA, and the full 

principal amount of the loans and any 

accrued interest may qualify for loan 

forgiveness. Additional information 

about the PPP is available in the First 

PPP Interim Final Rule (85 FR 20811), 

a second interim final rule (85 FR 

20817) (the Second PPP Interim Final 

Rule), a third interim final rule (85 FR 

21747) (the Third PPP Interim Final 

Rule), a fourth interim final rule (85 FR 

23450) (the Fourth PPP Interim Final 

Rule), and in an interim final rule 

issued by the Department of the 

Treasury, which was posted for public 

inspection at the Federal Register on 

April 28, 2020 (FR Doc. 2020–09239) 

(collectively, the PPP Interim Final 

Rules). 

1. Disbursements 

a. Can a borrower take multiple draws 

from a PPP loan and thereby delay the 

start of the eight-week covered period? 

No. The lender must make a one-time, 

full disbursement of the PPP loan 

within ten calendar days of loan 

approval; for the purposes of this rule, 

a loan is considered approved when the 

loan is assigned a loan number by SBA.1

For loans that received an SBA loan 

number prior to the posting of this 

interim final rule but have not yet been 

fully disbursed, the following transition 

rules apply: 


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Federal Register / Vol. 85, No. 86 / Monday, May 4, 2020 / Rules and Regulations 26323 

• The ten calendar-day period 

described above begins on April 28, 

2020. 

• The eight-week covered period 

began on the date of first disbursement. 

Notwithstanding this limitation, 

lenders are not responsible for delays in 

disbursement attributable to a 

borrower’s failure to timely provide 

required loan documentation, including 

a signed promissory note. Loans for 

which funds have not been disbursed 

because a borrower has not submitted 

required loan documentation within 20 

calendar days of loan approval shall be 

cancelled by the lender, subject to the 

transition rules above. When disbursing 

loans, lenders must send any amount of 

loan proceeds designated for the 

refinance of an EIDL loan directly to 

SBA and not to the borrower. 

The Administrator, in consultation 

with the Secretary, determined that 

requiring a single loan disbursement 

will best serve the interests of both 

borrowers and lenders and promote the 

purposes of the CARES Act. A single 

loan disbursement will eliminate the 

risk of delays in processing loan 

disbursement installments, advance the 

goal of payroll continuity for employees, 

and provide borrowers with faster 

access to the full loan amount so that 

they can immediately cover payroll 

costs. 

b. By when must a lender 

electronically submit an SBA Form 1502 

indicating that PPP loan funds have 

been disbursed? 

SBA will make available a specific 

SBA Form 1502 reporting process 

through which PPP lenders will report 

on PPP loans and collect the processing 

fee on fully disbursed loans to which 

they are entitled. Lenders must 

electronically upload SBA Form 1502 

information within 20 calendar days 

after a PPP loan is approved or, for loans 

approved before availability of the 

updated SBA Form 1502 reporting 

process, by May 18, 2020. The lender 

must report on SBA Form 1502 whether 

it has fully disbursed PPP loan 

proceeds. A lender will not receive a 

processing fee: (1) Prior to full 

disbursement of the PPP loan; (2) if the 

PPP loan is cancelled before 

disbursement; or (3) if the PPP loan is 

cancelled or voluntarily terminated and 

repaid after disbursement (including if a 

borrower repays the PPP loan proceeds 

to conform to the borrower’s 

certification regarding the necessity of 

the PPP loan request). In addition to 

providing ACH credit information to 

direct payment of the requested 

processing fee, lenders will be required 

to confirm that all PPP loans for which 

the lender is requesting a processing fee 

have been fully disbursed on the 

disbursement dates and in the loan 

amounts reported. A lender must report 

through either Etran Servicing or the 

SBA Form 1502 report any PPP loans 

that have been cancelled before 

disbursement or that have been 

cancelled or voluntarily terminated and 

repaid after disbursement. 

The Administrator, in consultation 

with the Secretary, determined that 

requiring lenders to report on 

disbursement within 20 calendar days 

of loan approval ensures that 

disbursement of funds to eligible 

borrowers will occur more rapidly. This 

requirement also will enhance SBA’s 

ability to track program data. 

2. Additional Information 

SBA may provide further guidance, if 

needed, through SBA notices that will 

be posted on SBA’s website at 

www.sba.gov. Questions on the 

Paycheck Protection Program may be 

directed to the Lender Relations 

Specialist in the local SBA Field Office. 

The local SBA Field Office may be 

found at https://www.sba.gov/tools/ 

local-assistance/districtoffices. 

Compliance With Executive Orders 

12866, 12988, 13132, 13563, and 13771, 

the Paperwork Reduction Act (44 

U.S.C. Ch. 35), and the Regulatory 

Flexibility Act (5 U.S.C. 601–612) 

Executive Orders 12866, 13563, and 

13771 

This interim final rule is 

economically significant for the 

purposes of Executive Orders 12866 and 

13563, and is considered a major rule 

under the Congressional Review Act. 

SBA, however, is proceeding under the 

emergency provision at Executive Order 

12866 Section 6(a)(3)(D) based on the 

need to move expeditiously to mitigate 

the current economic conditions arising 

from the COVID–19 emergency. This 

rule’s designation under Executive 

Order 13771 will be informed by public 

comment. 

Executive Order 12988 

SBA has drafted this rule, to the 

extent practicable, in accordance with 

the standards set forth in section 3(a) 

and 3(b)(2) of Executive Order 12988, to 

minimize litigation, eliminate 

ambiguity, and reduce burden. The rule 

has no preemptive or retroactive effect. 

Executive Order 13132 

SBA has determined that this rule 

will not have substantial direct effects 

on the States, on the relationship 

between the National Government and 

the States, or on the distribution of 

power and responsibilities among the 

various layers of government. Therefore, 

SBA has determined that this rule has 

no federalism implications warranting 

preparation of a federalism assessment. 

Paperwork Reduction Act, 44 U.S.C. 

Chapter 35 

SBA has determined that this rule 

will not impose new or modify existing 

recordkeeping or reporting requirements 

under the Paperwork Reduction Act. 

Regulatory Flexibility Act (RFA) 

The Regulatory Flexibility Act (RFA) 

generally requires that when an agency 

issues a proposed rule, or a final rule 

pursuant to section 553(b) of the APA or 

another law, the agency must prepare a 

regulatory flexibility analysis that meets 

the requirements of the RFA and 

publish such analysis in the Federal 

Register. 5 U.S.C. 603, 604. Specifically, 

the RFA normally requires agencies to 

describe the impact of a rulemaking on 

small entities by providing a regulatory 

impact analysis. Such analysis must 

address the consideration of regulatory 

options that would lessen the economic 

effect of the rule on small entities. The 

RFA defines a ‘‘small entity’’ as (1) a 

proprietary firm meeting the size 

standards of the Small Business 

Administration (SBA); (2) a nonprofit 

organization that is not dominant in its 

field; or (3) a small government 

jurisdiction with a population of less 

than 50,000. 5 U.S.C. 601(3)–(6). Except 

for such small government jurisdictions, 

neither State nor local governments are 

‘‘small entities.’’ Similarly, for purposes 

of the RFA, individual persons are not 

small entities. The requirement to 

conduct a regulatory impact analysis 

does not apply if the head of the agency 

‘‘certifies that the rule will not, if 

promulgated, have a significant 

economic impact on a substantial 

number of small entities.’’ 5 U.S.C. 

605(b). The agency must, however, 

publish the certification in the Federal 

Register at the time of publication of the 

rule, ‘‘along with a statement providing 

the factual basis for such certification.’’ 

If the agency head has not waived the 

requirements for a regulatory flexibility 

analysis in accordance with the RFA’s 

waiver provision, and no other RFA 

exception applies, the agency must 

prepare the regulatory flexibility 

analysis and publish it in the Federal 

Register at the time of promulgation or, 

if the rule is promulgated in response to 

an emergency that makes timely 

compliance impracticable, within 180 

days of publication of the final rule. 5 

U.S.C. 604(a), 608(b). 

Rules that are exempt from notice and 

comment are also exempt from the RFA 

requirements, including conducting a 


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26324 Federal Register / Vol. 85, No. 86 / Monday, May 4, 2020 / Rules and Regulations 

regulatory flexibility analysis, when 

among other things the agency for good 

cause finds that notice and public 

procedure are impracticable, 

unnecessary, or contrary to the public 

interest. SBA Office of Advocacy guide: 

How to Comply with the Regulatory 

Flexibility Act, Ch.1. p.9. Accordingly, 

SBA is not required to conduct a 

regulatory flexibility analysis. 

Jovita Carranza, 

Administrator. 

[FR Doc. 2020–09398 Filed 5–1–20; 8:45 am] 

BILLING CODE P 

SMALL BUSINESS ADMINISTRATION 

13 CFR Part 120 

[Docket Number SBA–2020–0023] 

RIN 3245–AH39 

Business Loan Program Temporary 

Changes; Paycheck Protection 

Program—Requirements—Corporate 

Groups and Non-Bank and NonInsured Depository Institution Lenders 

AGENCY: U. S. Small Business 

Administration. 

ACTION: Interim final rule. 

SUMMARY: On April 2, 2020, the U.S. 

Small Business Administration (SBA) 

posted an interim final rule announcing 

the implementation of the Coronavirus 

Aid, Relief, and Economic Security Act 

(CARES Act). The CARES Act 

temporarily adds a new program, titled 

the ‘‘Paycheck Protection Program,’’ to 

the SBA’s 7(a) Loan Program. The 

CARES Act also provides for forgiveness 

of up to the full principal amount of 

qualifying loans guaranteed under the 

Paycheck Protection Program (PPP). The 

PPP is intended to provide economic 

relief to small businesses nationwide 

adversely impacted by the Coronavirus 

Disease 2019 (COVID–19). SBA posted 

additional interim final rules on April 3, 

2020, April 14, 2020, April 24, 2020, 

and April 28, 2020, and the Department 

of the Treasury posted an additional 

interim final rule on April 28, 2020. 

This interim final rule supplements the 

previously posted interim final rules by 

limiting the amount of PPP loans that 

any single corporate group may receive 

and provides additional guidance on the 

criteria for non-bank lender 

participation in the PPP, and requests 

public comment. 

DATES: 

Effective date: This rule is effective 

May 4, 2020. 

Applicability date: This interim final 

rule applies to applications submitted 

under the Paycheck Protection Program 

through June 30, 2020, or until funds 

made available for this purpose are 

exhausted. 

Comment date: Comments must be 

received on or before June 3, 2020. 

ADDRESSES: You may submit comments, 

identified by number SBA–2020–0023 

through the Federal eRulemaking Portal: 

http://www.regulations.gov. Follow the 

instructions for submitting comments. 

SBA will post all comments on 

www.regulations.gov. If you wish to 

submit confidential business 

information (CBI) as defined in the User 

Notice at www.regulations.gov, please 

send an email to ppp-ifr@sba.gov. 

Highlight the information that you 

consider to be CBI and explain why you 

believe SBA should hold this 

information as confidential. SBA will 

review the information and make the 

final determination whether it will 

publish the information. 

FOR FURTHER INFORMATION CONTACT: A 

Call Center Representative at 833–572– 

0502, or the local SBA Field Office; the 

list of offices can be found at https://

www.sba.gov/tools/local-assistance/ 

districtoffices. 

SUPPLEMENTARY INFORMATION: 

I. Background Information 

On March 13, 2020, President Trump 

declared the ongoing Coronavirus 

Disease 2019 (COVID–19) pandemic of 

sufficient severity and magnitude to 

warrant an emergency declaration for all 

States, territories, and the District of 

Columbia. With the COVID–19 

emergency, many small businesses 

nationwide are experiencing economic 

hardship as a direct result of the 

Federal, State, tribal, and local public 

health measures that are being taken to 

minimize the public’s exposure to the 

virus. These measures, some of which 

are government-mandated, are being 

implemented nationwide and include 

the closures of restaurants, bars, and 

gyms. In addition, based on the advice 

of public health officials, other 

measures, such as keeping a safe 

distance from others or even stay-athome orders, are being implemented, 

resulting in a dramatic decrease in 

economic activity as the public avoids 

malls, retail stores, and other 

businesses. 

On March 27, 2020, the President 

signed the Coronavirus Aid, Relief, and 

Economic Security Act (the CARES Act) 

(Pub. L. 116–136) to provide emergency 

assistance and health care response for 

individuals, families, and businesses 

affected by the coronavirus pandemic. 

The Small Business Administration 

(SBA) received funding and authority 

through the CARES Act to modify 

existing loan programs and establish a 

new loan program to assist small 

businesses nationwide adversely 

impacted by the COVID–19 emergency. 

Section 1102 of the CARES Act 

temporarily permits SBA to guarantee 

100 percent of 7(a) loans under a new 

program titled the ‘‘Paycheck Protection 

Program.’’ Section 1106 of the CARES 

Act provides for forgiveness of up to the 

full principal amount of qualifying 

loans guaranteed under the Paycheck 

Protection Program. On April 24, 2020, 

the President signed the Paycheck 

Protection Program and Health Care 

Enhancement Act (Pub. L. 116–139), 

which provided additional funding and 

authority for the Paycheck Protection 

Program. 

As described below, to preserve the 

limited resources available to the PPP 

program, this interim final rule limits 

the aggregate amount of PPP loans that 

any single corporate group may receive. 

This interim final rule also provides 

additional guidance regarding lenders 

eligible to make PPP loans. 

II. Comments and Immediate Effective 

Date 

The intent of the CARES Act is that 

SBA provide relief to America’s small 

businesses expeditiously. This intent, 

along with the dramatic decrease in 

economic activity nationwide, provides 

good cause for SBA to dispense with the 

30-day delayed effective date provided 

in the Administrative Procedure Act. 

Specifically, it is critical to meet 

lenders’ and borrowers’ need for clarity 

concerning program requirements as 

rapidly as possible because the last day 

eligible borrowers can apply for and 

receive a loan is June 30, 2020. 

This interim final rule supplements 

previous regulations and guidance on 

certain important, discrete issues. The 

immediate effective date of this interim 

final rule will benefit lenders so that 

they can swiftly close and disburse 

loans to small businesses. This interim 

final rule is effective without advance 

notice and public comment because 

section 1114 of the CARES Act 

authorizes SBA to issue regulations to 

implement Title I of the CARES Act 

without regard to notice requirements. 

This rule is being issued to allow for 

immediate implementation of this 

program. Although this interim final 

rule is effective immediately, comments 

are solicited from interested members of 

the public on all aspects of this interim 

final rule, including section III below. 

These comments must be submitted on 

or before June 3, 2020. SBA will 

consider these comments and the need 

for making any revisions as a result of 

these comments. 


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