Sec. 5. Youth sport providers loan program
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In this section, the terms Administration and Administrator mean the Small Business Administration and the Administrator thereof, respectively. Section 7(a) of the Small Business Act ( 15 U.S.C. 636(a) ) is amended— in paragraph (2)— in subparagraph (A), in the matter preceding clause (i), by striking and
(F)and inserting (F), and
(G); and by adding at the end the following: In an agreement to participate in a loan on a deferred basis under paragraph (37), the participation by the Administration shall be 100 percent. ; and by adding at the end the following: In this paragraph— the terms appropriate Federal banking agency and insured depository institution have the meanings given those terms in section 3 of the Federal Deposit Insurance Act ( 12 U.S.C. 1813 ); the term covered loan means a loan made under this paragraph during the covered period; the term covered period means the period beginning on March 1, 2020, and ending on December 31, 2020; the term eligible recipient means an individual or entity that is a youth sports provider and is eligible to receive a covered loan; the term eligible self-employed individual has the meaning given the term in section 7002(b) of the Families First Coronavirus Response Act ( Public Law 116–127 ); the term high priority area means a geographic area for which an eligible recipient is a small business concern owned and controlled by socially and economically disadvantaged individuals, a small business concern owned and controlled by women, or a small business concern owned and controlled by veterans— working in or attracting youth participants from low income, underserved, or rural communities (based on ZIP code); working with populations disproportionately affected by COVID–19 (based on ZIP code); and working with populations of youth that already have low access to quality sports programs; the term insured credit union has the meaning given the term in section 101 of the Federal Credit Union Act ( 12 U.S.C. 1752 ); the term nonprofit organization means an organization that is described in section 501(c)(3) of the Internal Revenue Code of 1986 and that is exempt from taxation under section 501(a) of such Code; the term operating losses means regular operating expenses accrued since January 1, 2020, through the date of the loan application since January 1, 2020, minus revenue generated over that period; the term regular operating expenses — means expenses incurred in the regular operations of business and includes— payroll costs (as defined in paragraph (36)); other expenses relating to workforce support, including 1099–MISC contractors and volunteers, such as contractor fees for services, training, background screenings, or insurance; regular or necessary facilities maintenance and upkeep; supplies or materials that due to their nature are unusable at a future date and maintain only a nominal value; overhead expenses for events or programs cancelled due to COVID–19 that are not reimbursable through insurance or other means, such as nonreimbursable deposits and cancellation fees; rent (including rent under a lease agreement); payments of interest or mandatory principal payment on any mortgage obligation (which shall not include any prepayment of principal or interest on a mortgage obligation); utilities; interest or mandatory principal payment on any other debt obligations that were incurred before the covered period (which shall not include any prepayment of principal or interest on a debt obligation); marketing; insurance; or any other operational expenses, including program fee refunds, costs for referees or sports officials, software and technology, equipment, and supplies or materials that due to their nature are unusable at a future date and maintain only a nominal value; and does not include— expenses permitted to be reimbursed under contract or otherwise reimbursable; expenses reimbursable under currently held insurance; or any compensation of an employee whose principal place of residence is outside of the United States; the term youth sports provider — means any entity or organization that has a primary purpose to provide direct sports programming or sports events to youth 18 and under, including— sports-based youth development organizations; interscholastic sports programs; youth sports providers such as coaches, trainers, and instructors; and youth sport league, camp, or event providers; and the term veterans organization means an organization that is described in section 501(c)(19) of the Internal Revenue Code that is exempt from taxation under section 501(a) of such code. Except as otherwise provided in this paragraph, the Administrator may guarantee covered loans under the same terms, conditions, and processes as a loan made under this subsection. For purposes of making covered loans under this paragraph, a lender approved to make loans under this subsection shall be deemed to have been delegated authority by the Administrator to make and approve covered loans, subject to the provisions of this paragraph. The authority to make loans under this paragraph shall be extended to additional lenders determined by the Administrator and the Secretary of the Treasury to have the necessary qualifications to process, close, disburse, and service loans made with the guarantee of the Administration. A loan made under subsection (b)(2) during the period beginning on January 31, 2020, and ending on the date on which covered loans are made available may be refinanced as part of a covered loan. Notwithstanding the waiver of the personal guarantee requirement or collateral under subparagraph (J), the Administrator shall have no recourse against any individual shareholder, member, or partner of an eligible recipient of a covered loan for nonpayment of any covered loan, except to the extent that such shareholder, member, or partner uses the covered loan proceeds for a purpose not authorized under clause (ii). Not later than 15 days after the date on which a loan is made under this paragraph, the Administration shall register the loan using the TIN (as defined in section 7701 of the Internal Revenue Code of 1986) assigned to the borrower. During the covered period, any youth sports provider business concern, nonprofit organization, veterans organization, or Tribal business concern described in section 31(b)(2)(C) shall be eligible to receive a covered loan if the youth sports provider concern or organization employs not more than 500 full-time employees. An eligible recipient applying for a covered loan shall make a good faith certification— that the uncertainty of current economic conditions makes necessary the loan request to support the ongoing operations of the eligible recipient; that the eligible recipient provides direct sports programming or sports events to youth 18 and under; that the eligible recipient does not have an application pending for a loan under this subsection for the same purpose and duplicative of amounts applied for or received under a covered loan; and during the period beginning on February 15, 2020, and ending on December 31, 2020, that the eligible recipient has not received amounts under this subsection for the same purpose that when added to the applied for loan amount under this program will exceed $2 million. During the covered period, individuals who operate under a sole proprietorship or as an independent contractor and eligible self-employed individuals shall be eligible to receive a covered loan. An eligible self-employed individual, independent contractor, or sole proprietorship seeking a covered loan shall submit such documentation as is necessary to establish such individual as eligible, including payroll tax filings reported to the Internal Revenue Service, Forms 1099–MISC, and income and expenses from the sole proprietorship, as determined by the Administrator and the Secretary. No youth sports provider that received a covered loan under paragraph
(36)shall be deemed ineligible for a covered loan under this paragraph. For purposes of determining whether a youth sports provider business concern, nonprofit organization, veterans organization, or Tribal business concern described in section 31(b)(2)(C) employs not more than 500 employees under clause (i)(I), the term employee includes individuals employed on a full-time basis. The provisions applicable to affiliations under section 121.103 of title 13, Code of Federal Regulations, or any successor thereto, shall not apply with respect to a nonprofit organization and a veterans organization in the same manner as with respect to a small business concern. During the covered period, with respect to a covered loan, the maximum loan amount shall not exceed $2,000,000 and be the greater of— gross receipts in 2019; or 85 percent of regular operating expenses accrued since January 1, 2020, minus revenue generated over that period. Priority consideration in the loan disbursement shall be given to nonprofits representing youth sports providers serving high priority areas. This consideration may include designating a specific amount of the loan funding allocated to be used exclusively for nonprofit providers serving high priority areas. During the covered period, an eligible recipient may use the proceeds of the covered loan for regular operating expenses. An eligible recipient shall be eligible for forgiveness of indebtedness on a covered loan in an amount equal to percentage forgiveness multiplied by the loan amount. Up to 50 percent of forgiveness shall be granted for use for the eligible expenses enumerated above. Additional forgiveness of the remaining 50 percent shall be prorated based on the number of youth participants in the program participating in some capacity (i.e. virtual) by December 2021 (as compared to participation rates over a comparable period in 2019). Criteria shall be developed to define this standard and take into account factors that would limit or reduce participation, such as continuing COVID–19 concerns. Amounts which have been forgiven under this section shall be considered cancelled indebtedness by a lender authorized under section 7(a) of the Small Business Act ( 15 U.S.C. 636(a) ). For purposes of the purchase of the guarantee for a covered loan by the Administrator, amounts which are forgiven under this section shall be treated in accordance with the procedures that are otherwise applicable to a loan guaranteed under section 7(a) of the Small Business Act ( 15 U.S.C. 636(a) ). Not later than 90 days after the date on which the amount of forgiveness under this section is determined, the Administrator shall remit to the lender an amount equal to the amount of forgiveness, plus any interest accrued through the date of payment. . An eligible recipient seeking loan forgiveness under this section shall submit to the lender that is servicing the covered loan an application, which shall include— documentation verifying youth under the age of 18 participation numbers during the forgiveness calculation periods; documentation showing expenditures of the covered loan on allowed uses; a certification from a representative of the eligible recipient authorized to make such certifications that— the documentation presented is true and correct; and the amount for which forgiveness is requested was used to provide sports programing and sports events for youth under the age of 18; and any other documentation the Administrator determines necessary. No eligible recipient shall receive forgiveness under this section without submitting, to the lender that is servicing the covered loan, the documentation required under subsection (f). Not later than 60 days after the date on which a lender receives an application for loan forgiveness under this section from an eligible recipient, the lender shall issue a decision on the application. If a lender has received the documentation required under this section from an eligible recipient attesting that the eligible recipient has accurately verified the payments for payroll costs, payments on covered mortgage obligations, payments on covered lease obligations, or covered utility payments during covered period— an enforcement action may not be taken against the lender under section 47(e) of the Small Business Act ( 15 U.S.C. 657t(e) ) relating to loan forgiveness for the payments for payroll costs, payments on covered mortgage obligations, payments on covered lease obligations, or covered utility payments, as the case may be; and the lender shall not be subject to any penalties by the Administrator relating to loan forgiveness for the payments for payroll costs, payments on covered mortgage obligations, payments on covered lease obligations, or covered utility payments, as the case may be. For purposes of the Internal Revenue Code of 1986, any amount which (but for this subsection) would be includible in gross income of the eligible recipient by reason of forgiveness described in subsection
(b)shall be excluded from gross income. The cancellation of indebtedness on a covered loan under this section shall not otherwise modify the terms and conditions of the covered loan. Not later than 30 days after the date of enactment of this Act, the Administrator shall issue guidance and regulations implementing this section. There is appropriated, out of amounts in the Treasury not otherwise appropriated, for the fiscal year ending September 30, 2020, to remain available until September 30, 2021, for additional amounts $8,500,000,000 under the heading Small Business Administration—Business Loans Program Account, CARES Act for the cost of guaranteed loans as authorized under paragraph
(37)of section 7(a) of the Small Business Act ( 15 U.S.C. 636(a) ), as added by section 5 of this Act. Not later than 15 days after the date of enactment of this Act, the Administrator shall issue regulations to carry out this title and the amendments made by this title without regard to the notice requirements under section 553(b) of title 5, United States Code. The SBA shall have authority to provide additional financial awards to resource partners (Small Business Development Centers, Women’s Business Centers) to provide counseling, training, and education to youth sports providers on use of loans. The SBA or Treasury shall provide nonprofits representing youth sports providers serving high priority areas with grants to establish a training program on accessing resources under the program, and general financial management. During the covered period, with respect to a covered loan— in lieu of the fee otherwise applicable under paragraph (23)(A), the Administrator shall collect no fee; and in lieu of the fee otherwise applicable under paragraph (18)(A), the Administrator shall collect no fee. A covered loan shall bear an interest rate— for the first two years, and shall be no greater than 4 percent; for years 3 through 7, and shall have Applicable Federal Rate
(AFR)plus 250–450 base points
(bps)as determined by the Administrator based on revenue decline. In this section, the term impacted borrower means an eligible recipient that— is in operation on February 15, 2020; and has an application for a covered loan that is approved or pending approval on or after the date of enactment of this section. For purposes of this subsection, an impacted borrower is presumed to have been adversely impacted by COVID–19.
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Sec. 5
Youth sport providers loan program
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