March 17, 2019
By Caity Witucki
Contributing Editor, SBA Hot Topic Tuesday
SBA Hot Topic Tuesday —Chairman Rubio Introduces Bill to Help Small Businesses Impacted by Coronavirus
Last week, U.S. Senator Marco Rubio, Chairman of the Senate Committee on Small Business and Entrepreneurship, introduced a targeted proposal to open up the SBA’s 7(a) loan program to provide relief to America’s small businesses that face payroll and operational challenges due to economic effects from the coronavirus.
According to a March 12th press release, Chairman Rubio’s bill would:
- Increase the 7(a) loan program authorization level by $50 billion.
- Allow borrowers to use the proceeds of a 7(a) loan for payroll support.
- Waive all 7(a) loan fees for the duration of one year for both SBA lenders and borrowers.
- Provide a 90% loan guarantee for all loans, no matter the size.
- Increase the loan limit for SBA Express from $350,000 to $1 million.
- Allow the SBA to determine repayment ability based on an applicant’s credit score and not require proof of credit elsewhere for Economic Injury Disaster Loans (EIDL) made in response to the coronavirus epidemic.
- Utilize the existing disaster subsidy balance to support any subsidy costs and prevent the need for an appropriation.
“By increasing the SBA’s current 7(a) loan program by $50 billion, this program, which is offered by banks across our nation, will provide small businesses with access to much-needed capital to make payroll and provide paid sick leave for employees who miss work as a result of the coronavirus,” Chairman Rubio told the committee. “Additionally, this proposal will waive all fees for 7(a) loans for one year for both lenders and borrowers, as well as increase the loan guarantees. These are decisive steps that I believe will enjoy strong bipartisan support, and I am hopeful that every one of my colleagues will join me in this effort to prevent people from losing their jobs and our small businesses from going bankrupt.”
Information about pending legislation to support small businesses during the coronavirus epidemic is changing rapidly.