Senate passes omnibus with ICBA-advocated fixes

The Senate passed the $1.5 trillion omnibus to fund the government through Sept. 30 with ICBA-advocated provisions related to the SBA’s 504 loan program, LIBOR, and cyber incident reporting.

504 Program: Due to unusually high demand, the 504 program is on pace to exhaust its $7.5 billion lending authorization level in June, which would shutter it more than three months before the fiscal year ends Sept. 30.

  • After ICBA and other groups called on Congress to increase the 504 program’s authorization level, the omnibus sets funding authorizations at $11 billion for the regular 504 program and $5 billion for debt refinancing.

LIBOR: Meanwhile, the absence of clear guidance and a consistent federal standard for “tough legacy” contracts with interest rates based on LIBOR poses uncertainty, reduced liquidity, and increased volatility for investors, consumers, and securities issuers.

  • The omnibus includes an ICBA-supported provision directing the Federal Reserve to determine replacement rates that can be used for contracts lacking fallback language, by providing a safe harbor should the contract not specify a non-LIBOR replacement rate.

Cyber Reporting: Finally, policymakers have worked to advance bipartisan cyber incident reporting legislation for critical infrastructure that avoids excessive burdens on community banks.

  • An ICBA-supported provision in the omnibus establishes a cyber incident regime at the Cybersecurity and Infrastructure Security Agency that ensures timely information sharing, includes liability protections, and requires CISA to harmonize its regulations.

Next: Following House and Senate passage this week, the legislation is set to be signed by President Joe Biden today to avoid a government shutdown.