Title: Microloan Emergency Assistance Act of 2020
Policy area: Commerce

Summary:
Microloan Emergency Assistance Act of 2020
This bill expands the Microloan Program of the Small Business Administration (SBA).
Specifically, the bill increases the amount of funds available to an individual loan intermediary (i.e., a recipient of SBA direct loans that, in turn, makes microloans to startups and newly established or growing small businesses). The bill also makes eligible for certain technical assistance grants an intermediary that, among other requirements, provides at least 25% of its loans to small businesses in an economically distressed area.
In addition, the bill temporarily (1) extends repayment terms for microloans, and (2) authorizes the SBA to provide increased amounts for both technical assistance grants and direct loans. The bill also requires the SBA to temporarily waive (1) the requirement that an intermediary contribute non-federal funds as a condition of receiving a technical assistance grant, and (2) the limitation on amounts allowed to be expended to provide certain information and technical assistance.

[Congressional Bills 116th Congress]
[From the U.S. Government Publishing Office]
[H.R. 6291 Introduced in House (IH)]

<DOC>






116th CONGRESS
  2d Session
                                H. R. 6291

 To amend the microloan program of the Small Business Adminstration in 
             response to COVID-19, and for other purposes.


_______________________________________________________________________


                    IN THE HOUSE OF REPRESENTATIVES

                             March 19, 2020

   Mr. Kim introduced the following bill; which was referred to the 
                      Committee on Small Business

_______________________________________________________________________

                                 A BILL


 
 To amend the microloan program of the Small Business Adminstration in 
             response to COVID-19, and for other purposes.

    Be it enacted by the Senate and House of Representatives of the 
United States of America in Congress assembled,

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Microloan Emergency Assistance Act 
of 2020''.

SEC. 2. RECOVERY ASSISTANCE FOR MICROBUSINESSES.

    (a) Purpose.--The purpose of this section is to allow lenders to 
deploy more capital, give borrowers more time to repay, increase rural 
lending, and cut technical assistance red tape.
    (b) Loans to Intermediaries.--
            (1) In general.--Section 7(m) of the Small Business Act (15 
        U.S.C. 636(m)) is amended--
                    (A) in paragraph (3)(C)--
                            (i) by striking ``and $6,000,000'' and 
                        inserting ``$10,000,000, in the aggregate,''; 
                        and
                            (ii) by inserting before the period at the 
                        end the following: ``, and $4,500,000 in any of 
                        those remaining years'';
                    (B) in paragraph (4)--
                            (i) in subparagraph (A), by striking 
                        ``subparagraph (C)'' each place that term 
                        appears and inserting ``subparagraphs (C) and 
                        (G)'';
                            (ii) in subparagraph (C), by amending 
                        clause (i) to read as follows:
                            ``(i) In general.--In addition to grants 
                        made under subparagraph (A) or (G), each 
                        intermediary shall be eligible to receive a 
                        grant equal to 5 percent of the total 
                        outstanding balance of loans made to the 
                        intermediary under this subsection if--
                                    ``(I) the intermediary provides not 
                                less than 25 percent of its loans to 
                                small business concerns located in or 
                                owned by one or more residents of an 
                                economically distressed area; or
                                    ``(II) the intermediary has a 
                                portfolio of loans made under this 
                                subsection--
                                            ``(aa) that averages not 
                                        more than $10,000 during the 
                                        period of the intermediary's 
                                        participation in the program; 
                                        or
                                            ``(bb) of which not less 
                                        than 25 percent is serving 
                                        rural areas during the period 
                                        of the intermediary's 
                                        participation in the 
                                        program.''; and
                            (iii) by adding at the end the following:
                    ``(G) Grant amounts based on appropriations.--In 
                any fiscal year in which the amount appropriated to 
                make grants under subparagraph (A) is sufficient to 
                provide to each intermediary that receives a loan under 
                paragraph (1)(B)(i) a grant of not less than 25 percent 
                of the total outstanding balance of loans made to the 
                intermediary under this subsection, the Administration 
                shall make a grant under subparagraph (A) to each 
                intermediary of not less than 25 percent and not more 
                than 30 percent of that total outstanding balance for 
                the intermediary.''; and
                    (C) by striking paragraph (7) and inserting the 
                following:
            ``(7) Program funding for microloans.--Under the program 
        authorized by this subsection, the Administration may fund, on 
        a competitive basis, not more than 300 intermediaries.''.
            (2) Amendment in 2021.--Effective on October 1, 2021, 
        section 7(m)(3)(C) of the Small Business Act (15 U.S.C. 
        636(m)(3)(C)) is amended--
                    (A) by striking ``$10,000,000'' and by inserting 
                ``$7,000,000''; and
                    (B) by striking ``$4,500,000'' and inserting 
                ``$3,000,000''.
    (c) Temporary Waiver of Technical Assistance Grants Matching 
Requirements and Flexibility on Pre- and Post-Loan Assistance.--During 
the period beginning on the date of enactment of this Act and ending on 
September 30, 2021, the Administration shall waive--
            (1) the requirement to contribute non-Federal funds under 
        section 7(m)(4)(B) of the Small Business Act (15 U.S.C. 
        636(m)(4)(B)); and
            (2) the limitation on amounts allowed to be expended to 
        provide information and technical assistance under clause (i) 
        of section 7(m)(4)(E) of the Small Business Act (15 U.S.C. 
        636(m)(4)(E)) and enter into third-party contracts to provide 
        technical assistance under clause (ii) of such section 
        7(m)(4)(E).
    (d) Temporary Duration of Loans to Borrowers.--
            (1) In general.--During the period beginning on the date of 
        enactment of this Act and ending on September 30, 2021, the 
        duration of a loan made by an eligible intermediary under 
        section 7(m) of the Small Business Act (15 U.S.C. 636(m))--
                    (A) to an existing borrower may be extended to not 
                more than 8 years; and
                    (B) to a new borrower may be not more than 8 years.
            (2) Reversion.--On and after October 1, 2021, the duration 
        of a loan made by an eligible intermediary to a borrower under 
        section 7(m) of the Small Business Act (15 U.S.C. 636(m)) shall 
        be 7 years or such other amount established by the 
        Administrator.
    (e) Program Levels.--Section 20 of the Small Business Act (15 
U.S.C. 631 note) is amended by adding at the end the following:
    ``(h) Microloan Program.--For each of fiscal years 2021 through 
2025, the Administration is authorized to make--
            ``(1) $80,000,000 in technical assistance grants, as 
        provided in section 7(m); and
            ``(2) $110,000,000 in direct loans, as provided in section 
        7(m).''.
    (f) Authorization of Appropriations.--In addition to amounts 
provided under the Consolidated Appropriations Act, 2020 (Public Law 
116-93) for the program established under section 7(m) of the Small 
Business Act (15 U.S.C. 636(m)), there is authorized to be appropriated 
for fiscal year 2020, to remain available until expended--
            (1) $50,000,000 to provide technical assistance grants 
        under such section 7(m); and
            (2) $7,000,000 to provide direct loans under such section 
        7(m).
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