President Joe Biden signed into law the $1.5 trillion government funding omnibus with ICBA-advocated provisions related to the SBA’s 504 loan program and LIBOR.
504 Program: Due to unusually high demand, the 504 program was on pace to exhaust its $7.5 billion lending authorization level in June, which would have shuttered 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 has posed 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.
Flood Insurance: The omnibus also includes an ICBA-supported extension of the National Flood Insurance Program through Sept. 30.
Cyber Reporting: Additionally, a provision requiring cyber incident reporting for critical infrastructure avoids excessive burdens on community banks, includes liability protections, and requires harmonized regulations, as advocated by ICBA.