[Congressional Bills 117th Congress]
[From the U.S. Government Publishing Office]
[H.R. 4293 Introduced in House (IH)]
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117th CONGRESS
1st Session
H. R. 4293
To amend the Higher Education Act of 1965 to provide loan deferment and
loan cancellation for certain founders and employees of small business
start-ups, to amend the Small Business Act to establish a young
entrepreneurs business center, and for other purposes.
_______________________________________________________________________
IN THE HOUSE OF REPRESENTATIVES
June 30, 2021
Ms. Velazquez (for herself, Mr. Phillips, Ms. Chu, Mr. Evans, and Mr.
Kim of New Jersey) introduced the following bill; which was referred to
the Committee on Education and Labor, and in addition to the Committees
on Ways and Means, and Small Business, for a period to be subsequently
determined by the Speaker, in each case for consideration of such
provisions as fall within the jurisdiction of the committee concerned
_______________________________________________________________________
A BILL
To amend the Higher Education Act of 1965 to provide loan deferment and
loan cancellation for certain founders and employees of small business
start-ups, to amend the Small Business Act to establish a young
entrepreneurs business center, and for other purposes.
Be it enacted by the Senate and House of Representatives of the
United States of America in Congress assembled,
SECTION 1. SHORT TITLE.
This Act may be cited as the ``Supporting America's Young
Entrepreneurs Act of 2021''.
SEC. 2. SMALL BUSINESS START-UP EMPLOYEE LOAN DEFERMENT AND
CANCELLATION.
(a) Deferment.--Section 455(f) of the Higher Education Act of 1965
(20 U.S.C. 1087e(f)) is amended--
(1) in paragraph (1), by striking ``A borrower of a loan''
and inserting ``Except as provided in paragraph (5), a borrower
of a loan''; and
(2) by adding at the end the following:
``(5) No interest deferment eligibility for founders of
small business start-ups.--A borrower of a loan made under this
part shall be eligible for a deferment, during which periodic
installments of principal and interest need not be paid, during
any period not in excess of 3 years during which the borrower
is employed as a founder of a small business start-up (as
defined in subsection (r)(3)).''.
(b) Loan Cancellation.--Section 455 of the Higher Education Act of
1965 (20 U.S.C. 1087e) is amended by adding at the end the following:
``(r) Loan Cancellation for Certain Small Business Start-Up
Founders and Employees.--
``(1) Founders of a small business start-up in a distressed
area.--
``(A) In general.--The Secretary shall cancel
$20,000 of the balance of interest and principal due,
in accordance with subparagraph (B), on any eligible
Federal Direct Loan not in default for a borrower who--
``(i) has made 24 monthly payments on the
eligible Federal Direct Loan after the date of
the enactment of this subsection pursuant to
any one or a combination of payments under a
repayment plan under subsection (d)(1) or (g);
``(ii) has been employed as a founder of a
small business start-up in a distressed area
during the period in which the borrower makes
each of the 24 payments;
``(iii) is employed as a founder of a small
business start-up in a distressed area at the
time of such cancellation; and
``(iv) is approved for loan cancellation by
the young entrepreneurs business center under
section 49 of the Small Business Act (16 U.S.C.
631 et seq.).
``(B) Loan cancellation amount.--
``(i) In general.--After the conclusion of
the employment period described in subparagraph
(A), the Secretary shall cancel the obligation
to repay $20,000 of the balance of interest and
principal due as of the time of such
cancellation, on the eligible Federal Direct
Loans made to the borrower under this part.
``(ii) Limitation.--A borrower may not
receive an aggregate amount of more than
$20,000 under this subparagraph.
``(C) Ineligibility for double benefits.--No
borrower may, for the same service, receive a reduction
of loan obligations under both this paragraph and--
``(i) paragraph (2);
``(ii) subsection (m); or
``(iii) section 428J, 428K, 428L, or 460.
``(2) Employees of a small business start-up.--
``(A) In general.--The Secretary shall cancel
$3,000 of the balance of interest and principal due, in
accordance with subparagraph (B), on any eligible
Federal Direct Loan not in default for a borrower who--
``(i) has made 12 monthly payments on the
eligible Federal Direct Loan after the date of
the enactment of this subsection pursuant to
any one or a combination of payments under a
repayment plan under subsection (d)(1) or (g);
``(ii) has been employed in a small
business start-up job during the period in
which the borrower makes each of the 12
payments; and
``(iii) is employed in a small business
start-up job at the time of such cancellation.
``(B) Loan cancellation amount.--
``(i) In general.--After the conclusion of
the employment period described in subparagraph
(A), the Secretary shall cancel the obligation
to repay $3,000 of the balance of interest and
principal due as of the time of such
cancellation, on the eligible Federal Direct
Loans made to the borrower under this part.
``(ii) Limitation.--A borrower may not
receive an aggregate amount of more than
$15,000 under this subparagraph.
``(C) Ineligibility for double benefits.--No
borrower may, for the same service, receive a reduction
of loan obligations under both this paragraph and--
``(i) paragraph (1);
``(ii) subsection (m); or
``(iii) section 428J, 428K, 428L, or 460.
``(3) Definitions.--In this subsection:
``(A) Distressed area.--The term `distressed area'
means an area identified under section 49 of the Small
Business Act.
``(B) Eligible federal direct loan.--The term
`eligible Federal Direct Loan' means a Federal Direct
Stafford Loan, Federal Direct PLUS Loan, or Federal
Direct Unsubsidized Stafford Loan, or a Federal Direct
Consolidation Loan.
``(C) Founder.--The term `founder' has the meaning
given under section 49 of the Small Business Act.
``(D) Small business start-up.--The term `small
business start-up' means a business that is certified
by the young entrepreneurs business center under
section 49 of the Small Business Act.
``(E) Small business start-up job.--The term `small
business start-up job' means a full-time job as an
employee of a small business start-up.''.
SEC. 3. YOUNG ENTREPRENEURS BUSINESS CENTER.
The Small Business Act (15 U.S.C. 631 et seq.) is amended--
(1) by redesignating section 49 as section 50; and
(2) by inserting after section 48 the following new
section:
``SEC. 49. YOUNG ENTREPRENEURS BUSINESS CENTER.
``(a) Establishment.--There is established within the
Administration a young entrepreneurs business center that shall, for
purposes of determining eligibility for loan cancellation for a founder
of small business start-up under section 455(r)(1) of the Higher
Education Act of 1965--
``(1) certify small business start-ups under subsection
(b);
``(2) identify distressed areas under subsection (c); and
``(3) approve loan cancellation for any founder of a small
business start-up in a distressed area under subsection (d).
``(b) Certification.--
``(1) Application.--To be certified by the young
entrepreneurs business center, the founder of a small business
start-up shall submit an application to the Administrator that
includes--
``(A) a 5-year business plan for such small
business start-up; and
``(B) the number of employees the small business
start-up intends to employ on a yearly basis.
``(2) Requirements.--To be certified under this section, a
small business start-up shall have, on the date an application
is submitted under paragraph (1), a founder who is an employee
of such small business start-up and who is a recent graduate of
an institution of higher education.
``(c) Distressed Area.--
``(1) In general.--Not less than once every 3 years after
the date of the enactment of this section, the young
entrepreneurs business center shall identify and make
publically available on the website of the Administration a
list of distressed areas.
``(2) Requirements.--A distressed area identified under
paragraph (1) shall be a county or equivalent division of local
government of a State in which the small business concern is
located--
``(A) that has, for the most recent 24-month period
for which statistics are available--
``(i) a per capita income of 80 percent or
less of the national average; or
``(ii) an unemployment rate that is 1
percent greater than the national average; and
``(B) for which the young entrepreneurs business
center determines would economically benefit from
having small business start-ups established in such
area.
``(d) Loan Cancellation for Founders of Small Business Start-Ups in
a Distressed Area.--For purposes of loan cancellation under section
455(r)(1) of the Higher Education Act of 1965, the young entrepreneurs
business center shall approve a founder of a small business start-up in
a distressed area if such founder--
``(1) established a small business start-up that--
``(A) was located in a distressed area (as
identified under subsection (c)) for not more than 3
years before the date on which such small business
start-up was established;
``(B) was certified under subsection (b); and
``(C) on the date of approval under this
subsection, has been operating continuously for not
less than 5 years; and
``(2) was a founder of a small business start-up in a
distressed area during the period in which such founder made
the 24 payments described in section 455(r)(1)(A) of such Act.
``(e) Definitions.--In this section:
``(1) Institution of higher education.--The term
`institution of higher education' has the meaning given such
term in section 102 of the Higher Education Act (20 U.S.C.
1002).
``(2) Small business start-up.--The term `small business
start-up' means a small business concern that, as of the date
of submission of an application under subsection (b)--
``(A) does not exist; or
``(B) has been in existence for not more than 3
years.''.
SEC. 4. TREATMENT OF LOAN CANCELLATION.
(a) In General.--Section 108(f) of the Internal Revenue Code of
1986 is amended by adding at the end the following new paragraph:
``(6) Cancellation of certain federal student loans.--In
the case of an individual, gross income shall not include the
discharge (in whole or in part) of any student loan pursuant to
the cancellation (in whole or in part) of such loan by the
Secretary of Education under subsection (r) of section 455 of
the Higher Education Act of 1965 (20 U.S.C. 1087e).''.
(b) Effective Date.--The amendment made by this section shall apply
to discharges of indebtedness occurring after the date of the enactment
of this Act.
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