Title: Relief for Small Businesses and Nonprofits Act
Policy area: Finance and Financial Sector

Summary:
Relief for Small Businesses and Nonprofits Act
This bill places restrictions on the collection of debts owed by small businesses and nonprofit organizations during the COVID-19 (i.e., coronavirus disease 2019) emergency period. Among other things, debt collectors may not during such a period
After such a period, debt collectors must provide certain repayment options including extending the repayment period for debts.
Violations of these provisions are subject to civil enforcement.
The Federal Reserve Board must establish a facility to compensate loan holders for losses caused by the suspension of payments.

[Congressional Bills 116th Congress]
[From the U.S. Government Publishing Office]
[H.R. 6361 Introduced in House (IH)]

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116th CONGRESS
  2d Session
                                H. R. 6361

To provide loan and obligation payment relief for small businesses and 
 nonprofits affected by the COVID-19 emergency, and for other purposes.


_______________________________________________________________________


                    IN THE HOUSE OF REPRESENTATIVES

                             March 23, 2020

Mr. Perlmutter introduced the following bill; which was referred to the 
                    Committee on Financial Services

_______________________________________________________________________

                                 A BILL


 
To provide loan and obligation payment relief for small businesses and 
 nonprofits affected by the COVID-19 emergency, 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 ``Relief for Small Businesses and 
Nonprofits Act''.

SEC. 2. LOAN AND OBLIGATION PAYMENT RELIEF FOR AFFECTED SMALL 
              BUSINESSES AND NONPROFITS.

    (a) In General.--
            (1) In general.--During the COVID-19 emergency, a debt 
        collector may not, with respect to a debt of a small business 
        or nonprofit (other than debt related to a federally related 
        mortgage loan)--
                    (A) capitalize unpaid interest;
                    (B) apply a higher interest rate triggered by the 
                nonpayment of a debt to the debt balance;
                    (C) charge a fee triggered by the nonpayment of a 
                debt;
                    (D) sue or threaten to sue for nonpayment of a 
                debt;
                    (E) continue litigation to collect a debt that was 
                initiated before the date of enactment of this section;
                    (F) submit or cause to be submitted a confession of 
                judgment to any court;
                    (G) enforce a security interest through 
                repossession, limitation of use, or foreclosure;
                    (H) take or threaten to take any action to enforce 
                collection, or any adverse action for nonpayment of a 
                debt, or for nonappearance at any hearing relating to a 
                debt;
                    (I) commence or continue any action to cause or to 
                seek to cause the collection of a debt, including 
                pursuant to a court order issued before the end of the 
                120-day period following the end of the COVID-19 
                emergency, from wages, Federal benefits, or other 
                amounts due to a small business or nonprofit by way of 
                garnishment, deduction, offset, or other seizure;
                    (J) cause or seek to cause the collection of a 
                debt, including pursuant to a court order issued before 
                the end of the 120-day period following the end of the 
                COVID-19 emergency, by levying on funds from a bank 
                account or seizing any other assets of a small business 
                or nonprofit;
                    (K) commence or continue an action to evict a small 
                business or nonprofit from real or personal property; 
                or
                    (L) disconnect or terminate service from utility 
                service, including electricity, natural gas, 
                telecommunications or broadband, water, or sewer.
            (2) Rule of construction.--Nothing in this subsection may 
        be construed to prohibit a small business or nonprofit from 
        voluntarily paying, in whole or in part, a debt.
            (3) Repayment period.--After the expiration of the COVID-19 
        emergency, with respect to a debt described under paragraph 
        (1), a debt collector--
                    (A) may not add to the debt balance any interest or 
                fee prohibited by paragraph (1);
                    (B) shall, for credit with a defined term or 
                payment period, extend the time period to repay the 
                debt balance by 1 payment period for each payment that 
                a small business or nonprofit missed during the COVID-
                19 emergency, with the payments due in the same amounts 
                and at the same intervals as the pre-existing payment 
                schedule;
                    (C) shall, for an open end credit plan (as defined 
                under section 103 of the Truth in Lending Act) or other 
                credit without a defined term, allow the small business 
                or nonprofit to repay the debt balance in a manner that 
                does not exceed the amounts permitted by formulas under 
                section 170(c) of the Truth in Lending Act and 
                regulations promulgated thereunder; and
                    (D) shall, when the small business or nonprofit 
                notifies the debt collector, offer reasonable and 
                affordable repayment plans, loan modifications, 
                refinancing, options with a reasonable time in which to 
                repay the debt.
            (4) Communications in connection with the collection of a 
        debt.--
                    (A) In general.--During the COVID-19 emergency, 
                without prior consent of a small business or nonprofit 
                given directly to a debt collector during the COVID-19 
                emergency, or the express permission of a court of 
                competent jurisdiction, a debt collector may only 
                communicate in writing in connection with the 
                collection of any debt (other than debt related to a 
                federally related mortgage loan).
                    (B) Required disclosures.--
                            (i) In general.--All written communications 
                        described under subparagraph (A) shall inform 
                        the small business or nonprofit that the 
                        communication is for informational purposes and 
                        is not an attempt to collect a debt.
                            (ii) Requirements.--The disclosure required 
                        under clause (i) shall be made--
                                    (I) in type or lettering not 
                                smaller than 14-point bold type;
                                    (II) separate from any other 
                                disclosure;
                                    (III) in a manner designed to 
                                ensure that the recipient sees the 
                                disclosure clearly;
                                    (IV) in English and Spanish and in 
                                any additional languages in which the 
                                debt collector communicates, including 
                                the language in which the loan was 
                                negotiated, to the extent known by the 
                                debt collector; and
                                    (V) may be provided by first-class 
                                mail or electronically, if the borrower 
                                has otherwise consented to electronic 
                                communication with the debt collector 
                                and has not revoked such consent.
                            (iii) Oral notification.--Any oral 
                        notification shall be provided in the language 
                        the debt collector otherwise uses to 
                        communicate with the borrower.
                            (iv) Written translations.--In providing 
                        written notifications in languages other than 
                        English in this section, a debt collector may 
                        rely on written translations developed by the 
                        Bureau of Consumer Financial Protection.
            (5) Violations.--
                    (A) In general.--Any person who violates this 
                section shall be subject to civil liability in 
                accordance with section 813 of the Fair Debt Collection 
                Practices Act, as if the person is a debt collector for 
                purposes of that section.
                    (B) Predispute arbitration agreements.--
                Notwithstanding any other provision of law, no 
                predispute arbitration agreement or predispute joint-
                action waiver shall be valid or enforceable with 
                respect to a dispute brought under this section, 
                including a dispute as to the applicability of this 
                section, which shall be determined under Federal law.
            (6) Tolling.--Except as provided in paragraph (7)(D), any 
        applicable time limitations, including statutes of limitations, 
        related to a debt under Federal or State law shall be tolled 
        during the COVID-19 emergency.
            (7) Claims of affected creditors and debt collectors.--
                    (A) Valuation of property.--With respect to any 
                action asserting a taking under the Fifth Amendment of 
                the Constitution of the United States as a result of 
                this section or seeking a declaratory judgment 
                regarding the constitutionality of this section, the 
                value of the property alleged to have been taken 
                without just compensation shall be evaluated--
                            (i) with consideration of the likelihood of 
                        full and timely payment of the obligation 
                        without the actions taken pursuant to this 
                        section; and
                            (ii) without consideration of any 
                        assistance provided directly or indirectly to 
                        the small business or nonprofit from other 
                        Federal, State, and local government programs 
                        instituted or legislation enacted in response 
                        to the COVID-19 emergency.
                    (B) Scope of just compensation.--In an action 
                described in subparagraph (A), any assistance or 
                benefit provided directly or indirectly to the person 
                from other Federal, State, and local government 
                programs instituted in or legislation enacted response 
                to the COVID-19 emergency, shall be deemed to be 
                compensation for the property taken, even if such 
                assistance or benefit is not specifically provided as 
                compensation for property taken by this section.
                    (C) Appeals.--Any appeal from an action under this 
                section shall be treated under section 158 of title 28, 
                United States Code, as if it were an appeal in a case 
                under title 11, United States Code.
                    (D) Repose.--Any action asserting a taking under 
                the Fifth Amendment to the Constitution of the United 
                States as a result of this section shall be brought 
                within not later than 180 days after the end of the 
                COVID-19 emergency.
            (8) Definitions.--In this section:
                    (A) COVID-19 emergency.--The term ``COVID-19 
                emergency'' means the period that begins upon the date 
                of the enactment of this Act and ends on the date of 
                the termination by the Federal Emergency Management 
                Agency of the emergency declared on March 13, 2020, by 
                the President under the Robert T. Stafford Disaster 
                Relief and Emergency Assistance Act (42 U.S.C. 4121 et 
                seq.) relating to the Coronavirus Disease 2019 (COVID-
                19) pandemic.
                    (B) Creditor.--The term ``creditor'' means--
                            (i) any person who offers or extends credit 
                        creating a debt or to whom a debt is owed or 
                        other obligation for payment;
                            (ii) any lessor of real or personal 
                        property; or
                            (iii) any provider of utility services.
                    (C) Debt.--The term ``debt''--
                            (i) means any obligation or alleged 
                        obligation--
                                    (I) for which the original 
                                agreement, or if there is no agreement, 
                                the original obligation to pay was 
                                created before or during the COVID-19 
                                emergency, whether or not such 
                                obligation has been reduced to 
                                judgment; and
                                    (II) that arises out of a 
                                transaction with a small business or 
                                nonprofit; and
                            (ii) does not include a federally related 
                        mortgage loan.
                    (D) Debt collector.--The term ``debt collector'' 
                means a creditor, and any person or entity that engages 
                in the collection of debt, including the Federal 
                Government and a State government, irrespective of 
                whether the debt is allegedly owed to or assigned to 
                that person or to the entity.
                    (E) Federally related mortgage loan.--The term 
                ``federally related mortgage loan'' has the meaning 
                given that term under section 3 of the Real Estate 
                Settlement Procedures Act of 1974 (12 U.S.C. 2602).
                    (F) Nonprofit.--The term ``nonprofit'' means an 
                organization described in section 501(c)(3) of the 
                Internal Revenue Code of 1986 and exempt from taxation 
                under section 501(a) of such Code.
                    (G) Small business.--The term ``small business'' 
                has the meaning given the term ``small business 
                concern'' under section 3 of the Small Business Act.
    (b) Credit Facility for Other Purposes.--The Board of Governors of 
the Federal Reserve System shall establish a facility that the Board of 
Governors shall use to make payments to holders of loans or obligations 
to compensate such holders for documented financial losses--
            (1) with respect to a loan or obligation made to an 
        individual, small business, or nonprofit; and
            (2) where such losses were caused by a suspension of 
        payments required under Federal law in connection with the 
        COVID-19 emergency.
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