Bill Summary
This bill aims to provide financial assistance to small financial institutions that have been impacted by the COVID-19 pandemic. The bill establishes a payroll loan facility to offer loans to these institutions, with the goal of providing similar benefits to those provided by the Paycheck Protection Program. The bill also includes a loan forgiveness program for these loans, with requirements similar to those under the CARES Act. The bill defines key terms such as "community development financial institution" and "minority depository institution" and appropriates $25 billion to the Secretary of the Treasury for implementation.
Possible Impacts
1. Small financial institutions that are struggling financially due to COVID-19 may be able to receive loans through the payroll loan facility, allowing them to continue operating and paying their employees.
2. Minority depository institutions and rural banks with consolidated assets of less than $700,000,000 may also be eligible for loans through the payroll loan facility, providing them with much needed financial assistance during the pandemic.
3. The loan forgiveness program established under this legislation may help alleviate financial burdens for small financial institutions, allowing them to focus on recovering and rebuilding their businesses rather than worrying about loan repayment.
[Congressional Bills 116th Congress]
[From the U.S. Government Publishing Office]
[H.R. 6817 Introduced in House (IH)]
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116th CONGRESS
2d Session
H. R. 6817
To establish a payroll loan facility for small financial institutions
affected by COVID-19, and for other purposes.
_______________________________________________________________________
IN THE HOUSE OF REPRESENTATIVES
May 12, 2020
Mr. Green of Texas (for himself, Mr. Cleaver, and Mr. David Scott of
Georgia) introduced the following bill; which was referred to the
Committee on Financial Services
_______________________________________________________________________
A BILL
To establish a payroll loan facility for small financial institutions
affected by 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. PAYROLL LOAN FACILITY FOR SMALL FINANCIAL INSTITUTIONS.
(a) In General.--The Secretary of the Treasury shall establish a
payroll loan facility which shall make loans to small financial
institutions and which shall, to the maximum extent practicable,
provide equivalent benefits and assistance that are provided by the
Paycheck Protection Program.
(b) Loan Forgiveness.--The Secretary of the Treasury shall
establish a loan forgiveness program with respect to loans made under
subsection (a), that shall, to the maximum extent practicable, have the
same requirements as the loan forgiveness program established under
section 1106 of the CARES Act (15 U.S.C. 9005).
(c) Definitions.--In this section:
(1) Community development financial institution.--The term
``community development financial institution'' has the meaning
given that term under section 103 of the Riegle Community
Development and Regulatory Improvement Act of 1994 (12 U.S.C.
4702).
(2) Small financial institution.--The term ``small
financial institution'' means an institution that--
(A) is a community development financial
institution, minority depository institution, or rural
bank; and
(B) has consolidated assets of less than
$700,000,000.
(3) Insured credit union.--The term ``insured credit
union'' has the meaning given that term under section 101 of
the Federal Credit Union Act.
(4) Insured depository institution.--The term ``insured
depository institution'' has the meaning given that term under
section 3 of the Federal Deposit Insurance Act.
(5) Minority depository institution.--The term ``minority
depository institution'' has the meaning given that term under
section 308(b) of the Financial Institutions Reform, Recovery,
and Enforcement Act of 1989 (12 U.S.C. 1463 note).
(6) Paycheck protection program.--The term ``Paycheck
Protection Program'' means section 7(a)(36) of the Small
Business Act (15 U.S.C. 636(a)(36)).
(7) Rural.--With respect to an area, the term ``rural'' has
the meaning given that term under section 1026.35(b)(iv)(A) of
title 12, Code of Federal Regulations.
(8) Rural bank.--The term ``rural bank'' means an insured
credit union or insured depository institution located in a
rural area.
(d) Direct Appropriation for the Payroll Loan Facility.--There is
appropriated, out of amounts in the Treasury not otherwise
appropriated, $25,000,000,000 to the Secretary of the Treasury to carry
out this subsection.
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