September 30, 2020
WASHINGTON, D.C. – Today, U.S. Senator Angus King (I-Maine) announced his support for the Small Business Debt Relief Extension Act, which would provide continued coronavirus emergency debt relief distributed by the Small Business Administration (SBA) into 2021.The King-backed Small Business Debt Relief Act, which was passed into law as a part of the CARES Act in March, provided six months of vital debt relief that, before it expired on September 27, helped 320,000 small businesses keep their lights on and doors open. This legislation would extend this debt relief through February 2021 for all borrowers, and includes provisions to provide an additional seven months of debt relief for highly vulnerable businesses.
“When we initially provided funding for small businesses, we believed the administration would realistically confront the coronavirus pandemic by September’s end; the lack of a national strategy has left businesses anxious about the months ahead - and Mitch McConnell has yet to indicate any interest in providing relief,” said Senator King. “As the virus and its economic impacts continue to wreak havoc nationwide, I won’t stop fighting to provide aid to the people and businesses who make our communities so special. In the face of these challenges, we must remember that we will get through this together.”
The Small Business Debt Relief program has committed $8 billion in relief to some of America’s smallest, most at-risk employers during the recession. With no application required for businesses and minimal administrative burden, the program has delivered relief to 320,000 credit-challenged small businesses concentrated most heavily in the service industries hardest hit by the pandemic—by providing six months of principal, interest, and fee payments on all preexisting, deferred, and new 7(a) loans, 504 loans and microloans.
The Small Business Debt Relief Extension Act will:
· Extend debt relief payments for all small business with an SBA-backed loan for five months, through February 2021. That includes 7(a) loans, 504 loans, and microloans.
· Provide an additional seven months of debt relief for highly vulnerable businesses, including all those with a Community Advantage or microloan and those with a regular 7(a) or 504 loan that operate in the sectors hardest hit by the pandemic: educational services; arts, entertainment, and recreation; accommodation and food services; and charter buses.
· Extend the availability of debt relief on new SBA-loans for a full year, to include those approved through September 2021. This will provide an ongoing incentive for small business growth and job creation in all sectors.
· Ensure debt relief benefit is associated with no tax liability for any participating business.
· Improve program integrity and transparency, by increasing required SBA reporting to Congress and communication with borrowers.
· Require no new spending by Congress, as it will draw upon funds already appropriated under the CARES Act.
Senator King is a strong supporter of small businesses, which employ hundreds of thousands of Maine people. Last week, he led a bipartisan group of his Senate colleagues to introduce the Providing Resources for Emergency Preparedness and Resilient Enterprises (PREPARE) Act, which will help small businesses prepare for natural disasters. In July, he cosponsored the Restarting the Economy Sustainably Towards a Recovery in Twenty-twenty (RESTART) Act to support the small- and mid-sized businesses most affected by the coronavirus crisis, and earlier that month, Senator King wrote an op-ed to advocate for more federal support for Maine’s small businesses. He also sent a letter to Congressional leadership calling for additional funding for the Economic Development Administration (EDA)’s programs in future coronavirus economic recovery legislation.
Earlier this year, Senator King’s legislation to improve the Paycheck Protection Program was signed into law, providing Maine businesses with additional flexibility as they continue to navigate the challenges of the coronavirus. Additionally, Senator King has cosponsored legislation to reauthorize Brand USA, a public-private partnership that enhances tourism across the country through marketing campaigns that promote international travel to the United States. That legislation was signed into law in December 2019.