Comment Letter: Business Loan Program Temporary Changes; Paycheck Protection Program – Requirements – Loan Forgiveness

July 1, 2020

The Honorable Jovita Carranza
U.S. Small Business Administration
409 3rd Street SW
Washington, DC 20416

Re: Docket No. SBA–2020–0032 Business Loan Program Temporary Changes; Paycheck Protection Program – Requirements – Loan Forgiveness (RIN 1505-AC69)

Dear Administrator Carranza,

The National Association of State Credit Union Supervisors (NASCUS)[1] submits the following comments in response to the U.S. Small Business Administration’s (SBA’s) request for comments on Business Loan Program Temporary Changes; Paycheck Protection Program – Requirements – Loan Forgiveness (RIN 1505-AC69), one of the Interim Final Rules (IFR) implementing the Paycheck Protection Program (PPP).[2] The Coronavirus Aid, Relief, and Economic Security Act (CARES Act) was enacted to provide emergency assistance to individuals and entities affected by the COVID-19 pandemic.[3] Section 1102 of the CARES Act authorized the SBA to establish a new loan program to assist small businesses nationwide known as the PPP and to be administered under the SBA’s Section 7(a) loan program with the loans fully guaranteed and eligible for full forgiveness if established criteria are met.

NASCUS appreciates the sheer scale of the undertaking by SBA to stand up and administer a loan program as complex, and consequential, as the PPP. Thru May 30, 2020, the program had processed nearly 4.5 million loans, for an aggregate amount of over $500 billion, and included 5,454 participating lenders.[4]

NASCUS is aware there are numerous concerns regarding the specific metrics promulgated by the SBA that qualify a PPP loan for forgiveness. We leave comments on those issues to others in closer proximity to the lending process. Our brief comments focus on the affect on credit union lenders participating in the PPP of being inserted into the loan forgiveness decision.

NASCUS recommends SBA create safe harbors for lenders acting in good faith while administering all aspects of the PPP. We note that the program has continued to evolve even as more loans are processed. Policies and procedures, including custom forms, have been rendered moot after implementation by subsequent statutory or regulatory changes to the PPP beyond lenders’ control. Lenders should not be penalized, or exposed to liability, by technical missteps or superseding guidance.

We also strongly encourage SBA to establish a presumption of eligibility and forgiveness for categories of loans to ease the administrative burden on both borrowers and lenders.

NASCUS appreciates the opportunity to submit comments on the SBA’s Interim Final Rules implementing the PPP. As noted above, this effort to provide essential economic assistance to millions of small businesses and American workers is critically important to mitigate the financial impact of the COVID-19 pandemic. NASCUS, state credit union regulators, and the state credit union system remain committed to working with the SBA to ensure the successful administration of the PPP in a safe, sound, and effective manner. It is incumbent on the SBA to provide clear guidelines that allow borrowers and lenders to understand their responsibilities and obligations under the PPP. We are available at your convenience to discuss our recommendations further at your convenience.


– signature redacted for electronic publication –


Brian Knight

Executive Vice President & General Counsel



[1] NASCUS is the professional association of the nation’s 45 state credit union regulatory agencies that charter and supervise over 2,100 credit unions.

[2] 85 Fed. Reg. 105 at 33004 (June 1, 2020).

[3] Pub. L. 116–136.

[4] SBA Paycheck Protection Program Report, May 30, 2020, available at