Engrossed (House passed) — Paycheck Protection Program Flexibility Act of 2020

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Summary

The engrossed House-passed text of H. R. 7010 of the 116th Congress, the Paycheck Protection Program Flexibility Act of 2020, which passed the House of Representatives May 28, 2020. Section 2 sets a minimum maturity of 5 years for loans with a balance remaining after forgiveness. Section 3 extends the covered period to the earlier of 24 weeks after origination or December 31, 2020, adds an exemption based on employee availability, and requires at least 60 percent of the loan to be used for payroll costs to receive forgiveness. It also extends the payment deferral period until forgiveness is remitted to the lender. Section 4 strikes paragraph (3) of Section 2302(a) of the CARES Act on delayed employer payroll taxes, and Section 5 designates the Act an emergency requirement under 2 U.S.C. 933(g).

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116TH CONGRESS 
2D SESSION 
H. R. 7010 
AN ACT 
To amend the Small Business Act and the CARES Act 
to modify certain provisions related to the forgiveness 
of loans under the paycheck protection program, to allow 
recipients of loan forgiveness under the paycheck protec-
tion program to defer payroll taxes, and for other pur-
poses. 

2 
•HR 7010 EH
Be it enacted by the Senate and House of Representa-
1
tives of the United States of America in Congress assembled, 
2
SECTION 1. SHORT TITLE. 
3
This Act may be cited as the ‘‘Paycheck Protection 
4
Program Flexibility Act of 2020’’. 
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SEC. 2. MATURITY FOR LOANS WITH REMAINING BALANCE 
6
AFTER APPLICATION OF FORGIVENESS. 
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(a) IN GENERAL.—Section 7(a)(36)(K)(ii) of the 
8
Small Business Act (15 U.S.C. 636(a)(36)) is amended 
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by inserting ‘‘minimum maturity of 5 years and a’’ before 
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‘‘maximum maturity’’. 
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(b) EFFECTIVE DATE; APPLICABILITY.—The amend-
12
ment made by this section shall take effect on the date 
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of the enactment of this Act and shall apply to any loan 
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made pursuant to section 7(a)(36) of the Small Business 
15
Act (15 U.S.C. 636(a)(36)) on or after such date. Nothing 
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in this Act, the CARES Act (Public Law 116–136), or 
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the Paycheck Protection Program and Health Care En-
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hancement Act (Public Law 116–139) shall be construed 
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to prohibit lenders and borrowers from mutually agreeing 
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to modify the maturity terms of a covered loan described 
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in subparagraph (K) of such section to conform with re-
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quirements of this section. 
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•HR 7010 EH
SEC. 3. AMENDMENTS TO PAYCHECK PROTECTION PRO-
1
GRAM LOAN FORGIVENESS. 
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(a) EXTENSION
OF
COVERED
PERIOD.—Section 
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7(a)(36)(A)(iii) of the Small Business Act (15 U.S.C. 
4
636(a)(36)(A)(iii)) is amended by striking ‘‘June 30, 
5
2020’’ and inserting ‘‘December 31, 2020’’. 
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(b) FORGIVENESS.—Section 1106 of the CARES Act 
7
(Public Law 116–136) is amended— 
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(1) in subsection (a), by striking paragraph (3) 
9
and inserting the following: 
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‘‘(3) the term ‘covered period’ means, subject to 
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subsection (l), the period beginning on the date of 
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the origination of a covered loan and ending the ear-
13
lier of— 
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‘‘(A) the date that is 24 weeks after such 
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date of origination; or 
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‘‘(B) December 31, 2020;’’; 
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(2) in subsection (d)— 
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(A) in paragraph (5)(B), by striking ‘‘June 
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30, 2020’’ each place it appears and inserting 
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‘‘December 31, 2020’’; and 
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(B) by adding at the end the following new 
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paragraphs: 
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‘‘(7) EXEMPTION BASED ON EMPLOYEE AVAIL-
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ABILITY.—During the period beginning on February 
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15, 2020, and ending on December 31, 2020, the 
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•HR 7010 EH
amount of loan forgiveness under this section shall 
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be determined without regard to a proportional re-
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duction in the number of full-time equivalent em-
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ployees if an eligible recipient, in good faith— 
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‘‘(A) is able to document— 
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‘‘(i) an inability to rehire individuals 
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who were employees of the eligible recipi-
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ent on February 15, 2020; and 
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‘‘(ii) an inability to hire similarly 
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qualified employees for unfilled positions 
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on or before December 31, 2020; or 
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‘‘(B) is able to document an inability to re-
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turn to the same level of business activity as 
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such business was operating at before February 
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15, 2020, due to compliance with requirements 
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established or guidance issued by the Secretary 
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of Health and Human Services, the Director of 
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the Centers for Disease Control and Prevention, 
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or the Occupational Safety and Health Admin-
19
istration during the period beginning on March 
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1, 2020, and ending December 31, 2020, re-
21
lated to the maintenance of standards for sani-
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tation, social distancing, or any other worker or 
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customer safety requirement related to COVID– 
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19. 
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•HR 7010 EH
‘‘(8) LIMITATION
ON
FORGIVENESS.—To re-
1
ceive loan forgiveness under this section, an eligible 
2
recipient shall use at least 60 percent of the covered 
3
loan amount for payroll costs, and may use up to 40 
4
percent of such amount for any payment of interest 
5
on any covered mortgage obligation (which shall not 
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include any prepayment of or payment of principal 
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on a covered mortgage obligation), any payment on 
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any covered rent obligation, or any covered utility 
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payment.’’; and 
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(3) by adding at the end the following new sub-
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section: 
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‘‘(l) APPLICATION TO CERTAIN ELIGIBLE RECIPI-
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ENTS.—An eligible recipient that received a covered loan 
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before the date of enactment of this subsection may elect 
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for the covered period applicable to such covered loan to 
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end on the date that is 8 weeks after the date of the origi-
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nation of such covered loan.’’. 
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(c) EXTENSION
OF DEFERRAL PERIOD.—Section 
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7(a)(36)(M) of the Small Business Act (15 U.S.C. 
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636(a)(36)(M)) is amended— 
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(1) in clause (ii)(II), by striking ‘‘for a period 
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of not less than 6 months, including payment of 
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principal, interest, and fees, and not more than 1 
24
year.’’ and inserting the following: ‘‘, including pay-
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•HR 7010 EH
ment of principal, interest, and fees, until the date 
1
on which the amount of forgiveness determined 
2
under section 1106 of the CARES Act is remitted 
3
to the lender.’’; 
4
(2) in clause (iii), by striking ‘‘for a period of 
5
not less than 6 months, including payment of prin-
6
cipal, interest, and fees, and not more than 1 year.’’ 
7
and inserting the following: ‘‘, including payment of 
8
principal, interest, and fees, until the date on which 
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the amount of forgiveness determined under section 
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1106 of the CARES Act is remitted to the lender.’’; 
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and 
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(3) by adding at the end the following new 
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clause: 
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‘‘(v) RULE OF CONSTRUCTION.—If an 
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eligible recipient fails to apply for forgive-
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ness of a covered loan within 10 months 
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after the last day of the covered period de-
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fined in section 1106(a) of the CARES 
19
Act, such eligible recipient shall make pay-
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ments of principal, interest, and fees on 
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such covered loan beginning on the day 
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that is not earlier than the date that is 10 
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months after the last day of such covered 
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period.’’. 
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•HR 7010 EH
(d) EFFECTIVE DATE; APPLICABILITY.—The amend-
1
ments made by this section shall be effective as if included 
2
in the CARES Act (Public Law 116–136) and shall apply 
3
to any loan made pursuant to section 7(a)(36) of the 
4
Small Business Act (15 U.S.C. 636(a)(36)) or section 
5
1109 of the CARES Act. 
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SEC. 4. DELAY OF PAYMENT OF EMPLOYER PAYROLL 
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TAXES. 
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(a) IN GENERAL.—Section 2302(a) of the CARES 
9
Act (Public Law 116–136) is amended by striking para-
10
graph (3). 
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(b) EFFECTIVE DATE; APPLICABILITY.—The amend-
12
ments made by this section shall be effective as if included 
13
in the CARES Act (Public Law 116–136) and shall apply 
14
to any loan made pursuant to section 7(a)(36) of the 
15
Small Business Act (15 U.S.C. 636(a)(36)) or section 
16
1109 of the CARES Act. 
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SEC. 5. EMERGENCY DESIGNATION. 
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(a) IN GENERAL.—This Act is designated as an 
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emergency requirement pursuant to section 4(g) of the 
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Statutory Pay-As-You-Go Act of 2010 (2 U.S.C. 933(g)). 
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(b) DESIGNATION IN SENATE.—In the Senate, this 
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Act is designated as an emergency requirement pursuant 
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to section 4112(a) of H. Con. Res. 71 (115th Congress), 
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•HR 7010 EH
the concurrent resolution on the budget for fiscal year 
1
2018. 
2
Passed the House of Representatives May 28, 2020. 
Attest: 
Clerk. 


116TH CONGRESS 
2D SESSION 
H. R. 7010 
AN ACT 
To amend the Small Business Act and the CARES 
Act to modify certain provisions related to the 
forgiveness of loans under the paycheck protec-
tion program, to allow recipients of loan forgive-
ness under the paycheck protection program to 
defer payroll taxes, and for other purposes.

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