15 U.S.C. § 9011 — Subsidy for certain loan payments

Page 2496 TITLE 15—COMMERCE AND TRADE § 9010 Statutory Notes and Related Subsidiaries TAX TREATMENT OF RESTAURANT REVITALIZATION GRANTS Pub. L. 117–2, title IX, § 9673, Mar. 11, 2021, 135 Stat. 184, provided that: ‘‘For purposes of the Internal Rev- enue Code of 1986 [26 U.S.C. 1 et seq.]— ‘‘(1) amounts received from the Administrator of the Small Business Administration in the form of a restaurant revitalization grant under section 5003 [15 U.S.C. 9009c] shall not be included in the gross income of the person that receives such amounts, ‘‘(2) no deduction shall be denied, no tax attribute shall be reduced, and no basis increase shall be de- nied, by reason of the exclusion from gross income provided by paragraph (1), and ‘‘(3) in the case of a partnership or S corporation that receives such amounts— ‘‘(A) except as otherwise provided by the Sec- retary of the Treasury (or the Secretary’s dele- gate), any amount excluded from income by reason of paragraph (1) shall be treated as tax exempt in- come for purposes of sections 705 and 1366 of the In- ternal Revenue Code of 1986 [26 U.S.C. 705, 1366], and ‘‘(B) the Secretary of the Treasury (or the Sec- retary’s delegate) shall prescribe rules for deter- mining a partner’s distributive share of any amount described in subparagraph (A) for purposes of section 705 of the Internal Revenue Code of 1986.’’ § 9010. Resources and services in languages other than English (a) In general The Administrator shall provide the resources and services made available by the Administra- tion to small business concerns in the 10 most commonly spoken languages, other than English, in the United States, which shall in- clude Mandarin, Cantonese, Japanese, and Ko- rean. (b) Authorization of appropriations There is authorized to be appropriated to the Administrator $25,000,000 to carry out this sec- tion. (Pub. L. 116–136, div. A, title I, § 1111, Mar. 27, 2020, 134 Stat. 309.) § 9011. Subsidy for certain loan payments (a) Definition of covered loan In this section, the term ‘‘covered loan’’ means a loan that is— (1) guaranteed by the Administration under— (A) section 636(a) of this title— (i) including a loan made under the Com- munity Advantage Pilot Program of the Administration; and (ii) excluding a loan made under para- graph (36) of such section 636(a) of this title, as added by section 1102; or (B) title V of the Small Business Invest- ment Act of 1958 (15 U.S.C. 695 et seq.); or (2) made by an intermediary to a small busi- ness concern using loans or grants received under section 636(m) of this title. (b) Sense of Congress It is the sense of Congress that— (1) all borrowers are adversely affected by COVID–19; (2) relief payments by the Administration are appropriate for all borrowers; and (3) in addition to the relief provided under this Act, the Administration should encourage lenders to provide payment deferments, when appropriate, and to extend the maturity of covered loans, so as to avoid balloon payments or any requirement for increases in debt pay- ments resulting from deferments provided by lenders during the period of the national emer- gency declared by the President under the Na- tional Emergencies Act (50 U.S.C. 1601 et seq.) with respect to the Coronavirus Disease 2019 (COVID–19). (c) Principal and interest payments (1) In general Subject to the other provisions of this sec- tion, the Administrator shall pay the prin- cipal, interest, and any associated fees that are owed on a covered loan in a regular serv- icing status, without regard to the date on which the covered loan is fully disbursed, and subject to availability of funds, as follows: (A) With respect to a covered loan made before March 27, 2020, and not on deferment, the Administrator shall make those pay- ments as follows: (i) The Administrator shall make those payments for the 6-month period begin- ning with the next payment due on the covered loan. (ii) In addition to the payments under clause (i)— (I) with respect to a covered loan other than a covered loan described in para- graph (1)(A)(i) or (2) of subsection (a), the Administrator shall make those pay- ments for— (aa) the 3-month period beginning with the first payment due on the cov- ered loan on or after February 1, 2021; and (bb) an additional 5-month period im- mediately following the end of the 3- month period provided under item (aa) if the covered loan is made to a bor- rower that, according to records of the Administration, is assigned a North American Industry Classification Sys- tem code beginning with 61, 71, 72, 213, 315, 448, 451, 481, 485, 487, 511, 512, 515, 532, or 812; and (II) with respect to a covered loan de- scribed in paragraph (1)(A)(i) or (2) of subsection (a), the Administrator shall make those payments for the 8-month period beginning with the first payment due on the covered loan on or after Feb- ruary 1, 2021. (B) With respect to a covered loan made before March 27, 2020, and on deferment, the Administrator shall make those payments as follows: (i) The Administrator shall make those payments for the 6-month period begin- ning with the next payment due on the covered loan after the deferment period. (ii) In addition to the payments under clause (i)— (I) with respect to a covered loan other than a covered loan described in para- Page 2497 TITLE 15—COMMERCE AND TRADE § 9011 graph (1)(A)(i) or (2) of subsection (a), the Administrator shall make those pay- ments for— (aa) the 3-month period (beginning on or after February 1, 2021) beginning with the later of— (AA) the next payment due on the covered loan after the deferment pe- riod; or (BB) the first month after the Ad- ministrator has completed the pay- ments under clause (i); and (bb) an additional 5-month period im- mediately following the end of the 3- month period provided under item (aa) if the covered loan is made to a bor- rower that, according to records of the Administration, is assigned a North American Industry Classification Sys- tem code beginning with 61, 71, 72, 213, 315, 448, 451, 481, 485, 487, 511, 512, 515, 532, or 812; and (II) with respect to a loan described in paragraph (1)(A)(i) or (2) of subsection (a), the 8-month period (beginning on or after February 1, 2021) beginning with the later of— (aa) the next payment due on the covered loan after the deferment pe- riod; or (bb) the first month after the pay- ments under clause (i) are complete. (C) With respect to a covered loan made during the period beginning on March 27, 2020, and ending on the date that is 6 months after March 27, 2020, for the 6-month period beginning with the first payment due on the covered loan. (D) With respect to a covered loan ap- proved during the period beginning on Feb- ruary 1, 2021, and ending on September 30, 2021, for the 6-month period beginning with the first payment due on the covered loan. (2) Timing of payment The Administrator shall begin making pay- ments under paragraph (1) on a covered loan not later than 30 days after the date on which the first such payment is due. (3) Application of payment Any payment made by the Administrator under paragraph (1) shall be applied to the covered loan such that the borrower is re- lieved of the obligation to pay that amount. (4) Limitation (A) In general No single monthly payment of principal, interest, and associated fees made by the Administrator under subparagraph (A)(ii), (B)(ii), or (D) of paragraph (1) with respect to a covered loan may be in a total amount that is more than $9,000. (B) Treatment of additional amounts owed If, for a month, the total amount of prin- cipal, interest, and associated fees that are owed on a covered loan for which the Admin- istration makes payments under paragraph (1) is more than $9,000 the Administrator may require the lender with respect to the covered loan to add the amount by which those costs exceed $9,000 for that month as interest to be paid by the borrower with re- spect to the covered loan at the end of the loan period. (5) Additional provisions for new loans With respect to a loan described in para- graph (1)(C)— (A) the Administrator may further extend the period described in paragraph (1)(C) if there are sufficient funds to continue those payments; and (B) during the underwriting process, a lender of such a loan may consider the pay- ments under this section as part of a com- prehensive review to determine the ability to repay over the entire period of maturity of the loan. (6) Eligibility Eligibility for a covered loan to receive such payments of principal, interest, and any asso- ciated fees under this subsection shall be based on the date on which the covered loan is approved by the Administration. (7) Authority to revise extensions (A) In general The Administrator shall monitor whether amounts made available to make payments under this subsection are sufficient to make the payments for the periods described in paragraph (1). (B) Plan If the Administrator determines under subparagraph (A) that the amounts made available to make payments under this sub- section are insufficient, the Administrator shall— (i) develop a plan to proportionally re- duce the number of months provided for each period described in paragraph (1), while ensuring all amounts made available to make payments under this subsection are fully expended; and (ii) before taking action under the plan developed under clause (i), submit to Con- gress a report regarding the plan, which shall include the data that informs the plan. (8) Additional requirements With respect to the payments made under this subsection— (A) no lender may charge a late fee to a borrower with respect to a covered loan dur- ing any period in which the Administrator makes payments with respect to the covered loan under paragraph (1); and (B) the Administrator shall, with respect to a covered loan, make all payments with respect to the covered loan under paragraph (1) not later than the 15th day of the applica- ble month. (9) Rule of construction Except as provided in paragraph (4), nothing in this subsection may be construed to pre- clude a borrower from receiving full payments of principal, interest, and any associated fees Page 2498 TITLE 15—COMMERCE AND TRADE § 9011 1 So in original. The word ‘‘do’’ probably should not appear. authorized under this subsection with respect to a covered loan. (d) Other requirements The Administrator shall— (1) communicate and coordinate with the Federal Deposit Insurance Corporation, the Office of the Comptroller of the Currency, and State bank regulators to encourage those enti- ties to not require lenders to increase their re- serves on account of receiving payments made by the Administrator under subsection (c); (2) waive statutory limits on maximum loan maturities for any covered loan durations where the lender provides a deferral and ex- tends the maturity of covered loans during the 1-year period following March 27, 2020; and (3) when necessary to provide more time be- cause of the potential of higher volumes, trav- el restrictions, and the inability to access some properties during the COVID–19 pan- demic, extend lender site visit requirements to— (A) not more than 60 days (which may be extended at the discretion of the Adminis- tration) after the occurrence of an adverse event, other than a payment default, causing a loan to be classified as in liquidation; and (B) not more than 90 days after a payment default. (e) Rule of construction Nothing in this section may be construed to limit the authority of the Administrator to make payments pursuant to subsection (c) with respect to a covered loan solely because the cov- ered loan has been sold in the secondary market. (f) Eligibility for new loans For each individual lending program under this section, the Administrator may establish a minimum loan maturity period, taking into con- sideration the normal underwriting require- ments for each such program, with the goal of preventing abuse under the program. (g) Limitation on assistance A borrower may not receive assistance under subsection (c) for more than 1 covered loan of the borrower described in paragraph (1)(C) of that subsection. (h) Reporting and outreach (1) Updated information (A) In general Not later than 14 days after the date of en- actment of the Economic Aid to Hard-Hit Small Businesses, Nonprofits, and Venues Act, the Administrator shall make publicly available information regarding the modi- fications to the assistance provided under this section under the amendments made by such Act. (B) Guidance Not later than 21 days after the date of en- actment of the Economic Aid to Hard-Hit Small Businesses, Nonprofits, and Venues Act the Administrator shall issue guidance on implementing the modifications to the assistance provided under this section under the amendments made by such Act. (2) Publication of list Not later than March 1, 2021, the Adminis- trator shall transmit to each lender of a cov- ered loan a list of each borrower of a covered loan that includes the North American Indus- try Classification System code assigned to the borrower, based on the records of the Adminis- tration, to assist the lenders in identifying which borrowers qualify for an extension of payments under subsection (c). (3) Education and outreach The Administrator shall provide education, outreach, and communication to lenders, bor- rowers, district offices, and resource partners of the Administration in order to ensure full and proper compliance with this section, en- courage broad participation with respect to covered loans that have not yet been approved by the Administrator, and help lenders transi- tion borrowers from subsidy payments under this section directly to a deferral when suit- able for the borrower. (4) Notification Not later than 30 days after the date of en- actment of the Economic Aid to Hard-Hit Small Businesses, Nonprofits, and Venues Act, the Administrator shall mail a letter to each borrower of a covered loan that includes— (A) an overview of assistance provided under this section; (B) the rights of the borrower to receive that assistance; (C) how to seek recourse with the Adminis- trator or the lender of the covered loan if the borrower has not received that assist- ance; and (D) the rights of the borrower to request a loan deferral from a lender, and guidance on how to do 1 successfully transition directly to a loan deferral once subsidy payments under this section are concluded. (5) Monthly reporting Not later than the 15th of each month begin- ning after the date of enactment of the Eco- nomic Aid to Hard-Hit Small Businesses, Non- profits, and Venues Act, the Administrator shall submit to Congress a report on assist- ance provided under this section, which shall include— (A) monthly and cumulative data on pay- ments made under this section as of the date of the report, including a breakdown by— (i) the number of participating bor- rowers; (ii) the volume of payments made for each type of covered loan; and (iii) the volume of payments made for covered loans made before March 27, 2020, and loans made after March 27, 2020; (B) the names of any lenders of covered loans that have not submitted information on the covered loans to the Administrator during the preceding month; and (C) an update on the education and out- reach activities of the Administration car- ried out under paragraph (3). Page 2499 TITLE 15—COMMERCE AND TRADE § 9013 1 See References in Text note below. (i) Authorization of appropriations There is authorized to be appropriated to the Administrator $17,000,000,000 to carry out this section. (Pub. L. 116–136, div. A, title I, § 1112, Mar. 27, 2020, 134 Stat. 309; Pub. L. 116–260, div. N, title III, § 325(a), Dec. 27, 2020, 134 Stat. 2032.) Editorial Notes REFERENCES IN TEXT Section 1102, referred to in subsec. (a)(1)(A)(ii), means section 1102 of Pub. L. 116–136. The Small Business Investment Act of 1958, referred to in subsec. (a)(1)(B), is Pub. L. 85–699, Aug. 21, 1958, 72 Stat. 689. Title V of the Act is classified generally to subchapter V (§ 695 et seq.) of chapter 14B of this title. For complete classification of this Act to the Code, see Short Title note set out under section 661 of this title and Tables. This Act, referred to in subsec. (b)(3), is div. A of Pub. L. 116–136, Mar. 27, 2020, 134 Stat. 286. For complete clas- sification of this Act to the Code, see Tables. The National Emergencies Act, referred to in subsec. (b)(3), is Pub. L. 94–412, Sept. 14, 1976, 90 Stat. 1255, which is classified principally to chapter 34 (§ 1601 et seq.) of Title 50, War and National Defense. For com- plete classification of this Act to the Code, see Short Title note set out under section 1601 of Title 50 and Ta- bles. The date of enactment of the Economic Aid to Hard- Hit Small Businesses, Nonprofits, and Venues Act, re- ferred to in subsec. (h)(1), (4), (5), is the date of enact- ment of title III of div. N of Pub. L. 116–260, which was approved Dec. 27, 2020. Such Act, referred to in subsec. (h)(1), means the Eco- nomic Aid to Hard-Hit Small Businesses, Nonprofits, and Venues Act, which is title III of div. N of Pub. L. 116–260, Dec. 27, 2020, 134 Stat. 1993. For complete classi- fication of this Act to the Code, see Short Title of 2020 Amendment note set out under section 9001 of this title and Tables. AMENDMENTS 2020—Subsec. (c)(1). Pub. L. 116–260, § 325(a)(1)(A), added par. (1) and struck out former par. (1). Prior to amendment, text read as follows: ‘‘The Administrator shall pay the principal, interest, and any associated fees that are owed on a covered loan in a regular serv- icing status— ‘‘(A) with respect to a covered loan made before March 27, 2020, and not on deferment, for the 6-month period beginning with the next payment due on the covered loan; ‘‘(B) with respect to a covered loan made before March 27, 2020, and on deferment, for the 6-month pe- riod beginning with the next payment due on the cov- ered loan after the deferment period; and ‘‘(C) with respect to a covered loan made during the period beginning on March 27, 2020, and ending on the date that is 6 months after March 27, 2020, for the 6- month period beginning with the first payment due on the covered loan.’’ Subsec. (c)(4) to (9). Pub. L. 116–260, § 325(a)(1)(B), added pars. (4) to (9). Subsecs. (f) to (i). Pub. L. 116–260, § 325(a)(2), (3), added subsecs. (f) to (h) and redesignated former subsec. (f) as (i). Statutory Notes and Related Subsidiaries EFFECTIVE DATE OF 2020 AMENDMENT Pub. L. 116–260, div. N, title III, § 325(b), Dec. 27, 2020, 134 Stat. 2036, provided that: ‘‘The amendments made by subsection (a) [amending this section] shall be effec- tive as if included in the CARES Act (Public Law 116–136; 134 Stat. 281).’’ CLARIFICATION OF TAX TREATMENT OF CERTAIN LOAN FORGIVENESS AND OTHER BUSINESS FINANCIAL AS- SISTANCE Payment described in subsec. (c) of this section not included in gross income of person on whose behalf such payment was made, see section 278 of div. N of Pub. L. 116–260, set out as a note under section 9008 of this title. § 9012. Emergency rulemaking authority Not later than 15 days after March 27, 2020, the Administrator shall issue regulations to carry out this title 1 and the amendments made by this title 1 without regard to the notice requirements under section 553(b) of title 5. (Pub. L. 116–136, div. A, title I, § 1114, Mar. 27, 2020, 134 Stat. 312.) Editorial Notes REFERENCES IN TEXT This title, referred to in text, is title I of div. A of Pub. L. 116–136, Mar. 27, 2020, 134 Stat. 286, which en- acted this subchapter and amended, and enacted provi- sions set out as notes under, section 636 of this title and several sections in Title 11, Bankruptcy. For complete classification of title I to the Code, see Tables. Statutory Notes and Related Subsidiaries EMERGENCY RULEMAKING AUTHORITY IN PUBLIC LAW 116–260 Pub. L. 116–260, div. N, title III, § 303, Dec. 27, 2020, 134 Stat. 1993, provided that: ‘‘Not later than 10 days after the date of enactment of this Act [Dec. 27, 2020], the Ad- ministrator [of the Small Business Administration] shall issue regulations to carry out this Act [probably means ‘‘this title’’, title III of div. N of Pub. L. 116–260, see Tables for classification] and the amendments made by this Act without regard to the notice requirements under section 553(b) of title 5, United States Code.’’ § 9013. Community Navigator pilot program (a) Definitions In this section: (1) Administration The term ‘‘Administration’’ means the Small Business Administration. (2) Administrator The term ‘‘Administrator’’ means the Ad- ministrator of the Small Business Administra- tion. (3) Community navigator services The term ‘‘community navigator services’’ means the outreach, education, and technical assistance provided by community navigators that target eligible businesses to increase awareness of, and participation in, programs of the Small Business Administration. (4) Community navigator The term ‘‘community navigator’’ means a community organization, community finan- cial institution as defined in section 636(a)(36)(A) of this title, or other private non- profit organization engaged in the delivery of community navigator services.