State Small Business Credit Initiative Renewal Act

To amend the State Small Business Credit Initiative Act of 2010 to respond to the COVID–19 pandemic, and for other purposes. 1. Short title This Act may be cited as the State Small Business Credit Initiative Renewal Act 2. Reauthorization of the State Small Business Credit Initiative Act of 2010 (a) Reauthorization (1) In general The State Small Business Credit Initiative Act of 2010 ( 12 U.S.C. 5701 (A) in section 3003— (i) in subsection (b)— (I) by amending paragraph (1) to read as follows: (1) In general Not later than 30 days after the date of enactment of subsection (d), the Secretary shall allocate Federal funds to participating States so that each State is eligible to receive an amount equal to what the State would receive under the 2021 allocation, as determined under paragraph (2). ; (II) in paragraph (2)— (aa) by striking 2009 2021 (bb) by striking 2008 2020 (cc) in subparagraph (A), by striking The Secretary With respect to States other than Tribal governments, the Secretary (dd) in subparagraph (C)(i), by striking 2007 2019 (ee) by adding at the end the following: (C) Separate allocation for Tribal governments (i) In general With respect to States that are Tribal governments, the Secretary shall determine the 2021 allocation by allocating $500,000,000 among the Tribal governments in the proportion the Secretary determines appropriate, including with consideration to available employment and economic data regarding each such Tribal government. (ii) Notice of intent; timing of allocation With respect to allocations to States that are Tribal governments, the Secretary may— (I) require Tribal governments that wish to participate in the Program to file a notice of intent with the Secretary not later than 30 days after the date of enactment of subsection (d); and (II) notwithstanding paragraph (1), allocate Federal funds to participating Tribal governments not later than 60 days after the date of enactment of subsection (d). (D) Employment data If the Secretary determines that employment data with respect to a State is unavailable from the Bureau of Labor Statistics of the Department of Labor, the Secretary shall consider such other economic and employment data that is otherwise available for purposes of determining the employment data of such State. ; and (III) by striking paragraph (3); and (ii) in subsection (c)— (I) in paragraph (1)(A)(iii), by inserting before the period the following: that have delivered loans or investments to eligible businesses (II) by amending paragraph (4) to read as follows: (4) Termination of availability of amounts not transferred (A) In general Any portion of a participating State’s allocated amount that has not been transferred to the State under this section may be deemed by the Secretary to be no longer allocated to the State and no longer available to the State and shall be returned to the general fund of the Treasury or reallocated as described under subparagraph (B), if— (i) the second 1/3 (ii) the last 1/3 (B) Reallocation Any amount deemed by the Secretary to be no longer allocated to a State and no longer available to such State under subparagraph (A) may be reallocated by the Secretary to other participating States. In making such a reallocation, the Secretary shall not take into account the minimum allocation requirements under subsection (b)(2)(B) or the specific allocation for Tribal governments described under subsection (b)(2)(C). ; (B) in section 3004(d), by striking date of enactment of this Act date of the enactment of section 3003(d) (C) in section 3005(b), by striking date of enactment of this Act date of the enactment of section 3003(d) (D) in section 3006(b)(4), by striking date of enactment of this Act date of the enactment of section 3003(d) (E) in section 3007(b), by striking March 31, 2011 March 31, 2022 (F) in section 3009, by striking date of enactment of this Act date of the enactment of section 3003(d) (G) in section 3011(b), by striking date of the enactment of this Act date of the enactment of section 3003(d) (2) Appropriation (A) In general There is hereby appropriated to the Secretary of the Treasury, out of funds in the Treasury not otherwise appropriated, $10,000,000,000 to carry out the State Small Business Credit Initiative established under the State Small Business Credit Initiative Act of 2010, including to pay reasonable costs of administering such Initiative. (B) Rescission With respect to amounts appropriated under subparagraph (A)— (i) the Secretary of the Treasury shall complete all disbursements and remaining obligations before September 30, 2030; and (ii) any amounts that remain unexpended (whether obligated or unobligated) on September 30, 2030, shall be rescinded and deposited into the general fund of the Treasury. (b) Additional allocations to support business enterprises owned and controlled by socially and economically disadvantaged individuals Section 3003 of the State Small Business Credit Initiative Act of 2010 ( 12 U.S.C. 5702 (d) Additional allocations to support business enterprises owned and controlled by socially and economically disadvantaged individuals Of the amounts appropriated to carry out the Program, the Secretary shall— (1) ensure that $1,500,000,000 from funds allocated under this section shall be expended for business enterprises owned and controlled by socially and economically disadvantaged individuals; and (2) allocate such amounts to States based on the needs of business enterprises owned and controlled by socially and economically disadvantaged individuals, as determined by the Secretary, in each State, and not subject to the allocation formula described under subsection (b). (e) Supporting business enterprises owned and controlled by socially and economically disadvantaged individuals In allocating funds to participating States under this section, the Secretary shall establish a minimum amount of support that a State shall provide to business enterprises owned and controlled by socially and economically disadvantaged individuals. (f) Incentive allocations to support business enterprises owned and controlled by socially and economically disadvantaged individuals Of the amounts appropriated to carry out the Program, the Secretary shall set aside $1,000,000,000 for an incentive program under which the Secretary shall increase the second 1/3 1/3 . (c) CDFI and MDI participation plan Section 3004 of the State Small Business Credit Initiative Act of 2010 ( 12 U.S.C. 5703 (e) CDFI and MDI participation plan The Secretary may not approve a State to be a participating State unless the State has provided the Secretary with a plan detailing how minority depository institutions and community development financial institutions will be encouraged to participate in State programs. . (d) Pandemic response plan Section 3004 of the State Small Business Credit Initiative Act of 2010 ( 12 U.S.C. 5703 (f) Pandemic response plan The Secretary may not approve a State to be a participating State unless the State has provided the Secretary with a description of how the State will expeditiously utilize funds to support small businesses, including business enterprises owned and controlled by socially and economically disadvantaged individuals, in responding to and recovering from the economic effects of the COVID–19 pandemic. . (e) Technical assistance (1) State technical assistance plan Section 3004 of the State Small Business Credit Initiative Act of 2010 ( 12 U.S.C. 5703 (g) State technical assistance plan (1) In general The Secretary may not approve a State to be a participating State unless the State has provided the Secretary with a technical assistance plan under which the State will use a portion of the funds received under the Program to provide legal, accounting, and financial advisory services to very small businesses and business enterprises owned and controlled by socially and economically disadvantaged individuals applying for— (A) State programs under the Program; and (B) other State or Federal programs that support small businesses. (2) Contracting Services described under paragraph (1) may be contracted with legal, accounting, and financial advisory firms, with priority given to business enterprises owned and controlled by socially and economically disadvantaged individuals. . (2) Funding Section 3009 of the State Small Business Credit Initiative Act of 2010 ( 12 U.S.C. 5708 (e) Technical assistance Of the amounts appropriated to carry out the Program, $500,000,000 may be used by the Secretary to— (1) provide funds to States to carry out technical assistance plans described under section 3004(g); (2) transfer amounts to the Minority Business Development Agency, so that the Agency may use such amounts in a manner the Agency determines appropriate, including through contracting with third parties, to provide technical assistance to business enterprises owned and controlled by socially and economically disadvantaged individuals applying to— (A) State programs under the Program; and (B) other State or Federal programs that support small businesses; and (3) contract with legal, accounting, and financial advisory firms (with priority given to business enterprises owned and controlled by socially and economically disadvantaged individuals), to provide technical assistance to business enterprises owned and controlled by socially and economically disadvantaged individuals applying to— (A) State programs under the Program; and (B) other State or Federal programs that support small businesses. . (f) Multi-State participation program Section 3009 of the State Small Business Credit Initiative Act of 2010 ( 12 U.S.C. 5708 (f) Multi-State participation program The Secretary may establish a multi-State participation program under which— (1) the Secretary determines which State programs are similar to each other, with respect to eligibility criteria and such other criteria as the Secretary determines appropriate; and (2) a State may elect to automatically deem a person eligible for a State program if the person is already participating in another State’s State program that the Secretary has determined is similar under paragraph (1). . (g) Application of the Military Lending Act Section 3004 of the State Small Business Credit Initiative Act of 2010 ( 15 U.S.C. 5702 (h) Application of the Military Lending Act The Secretary may not approve a State to be a participating State unless the State has agreed that no lending activity supported by amounts received by the State under the Program would result in interest rates being charged at an annualized percentage rate above 36 percent, as determined in accordance with section 987(b) of title 10, United States Code (commonly known as the Military Lending Act . (h) Inclusion of Tribal governments Section 3002(10) of the State Small Business Credit Initiative Act of 2010 ( 12 U.S.C. 5701(10) (1) in subparagraph (C), by striking and (2) in subparagraph (D), by striking the period at the end and inserting ; and (3) by adding at the end the following: (E) a Tribal government. . (i) Definitions Section 3002 of the State Small Business Credit Initiative Act of 2010 ( 12 U.S.C. 5701 (15) Business enterprise owned and controlled by socially and economically disadvantaged individuals The term business enterprise owned and controlled by socially and economically disadvantaged individuals (A) if privately owned, 51 percent is owned by one or more socially and economically disadvantaged individuals; (B) if publicly owned, 51 percent of the stock is owned by one or more socially and economically disadvantaged individuals; and (C) in the case of a mutual institution, a majority of the Board of Directors, account holders, and the community which the institution services is predominantly comprised of socially and economically disadvantaged individuals. (16) Community development financial institution The term community development financial institution (17) Minority depository institution The term minority depository institution (18) Socially and economically disadvantaged individual The term socially and economically disadvantaged individual 15 U.S.C. 637 (19) Tribal government The term Tribal government 25 U.S.C. 5131 . (j) Rule of application The amendments made by this section shall apply with respect to funds appropriated under this section and funds appropriated on and after the date of enactment of this section.

Summary: State Small Business Credit Initiative Renewal Act This bill reauthorizes the State Small Business Credit Initiative through which the Department of the Treasury provides funding for participating states and tribal governments to support small business credit expansion programs that deliver loans or investments to eligible small businesses. A participating state must provide Treasury with a description of (1) how minority depository institutions and community development financial institutions will be encouraged to participate in state programs, and (2) how the state will utilize funds to support small businesses in responding to and recovering from the economic effects of COVID-19. The bill allocates specified portions of this funding for (1) states to support businesses that are owned by socially and economically disadvantaged individuals, (2) an incentive program to boost funding for states that demonstrate robust support for those businesses, (3) support for very small businesses (e.g., those with fewer than 10 employees), and (4) tribal governments. Additionally, Treasury may provide funds to states, the Minority Business Development Agency, or other advisory firms to provide technical assistance to specified small businesses.