[Congressional Bills 103th Congress]
[From the U.S. Government Publishing Office]
[S. 408 Introduced in Senate (IS)]

103d CONGRESS
  1st Session
                                 S. 408

To promote small business lending to small business concerns in States 
  in which there is a declining number of federally-insured financial 
                             institutions.


_______________________________________________________________________


                   IN THE SENATE OF THE UNITED STATES

             February 18 (legislative day, January 5), 1993

  Mr. Chafee introduced the following bill; which was read twice and 
              referred to the Committee on Small Business

_______________________________________________________________________

                                 A BILL


 
To promote small business lending to small business concerns in States 
  in which there is a declining number of federally-insured financial 
                             institutions.

    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 ``Small Business Lending and Credit 
Availability Act of 1993''.

SEC. 2. LOAN GUARANTEES IN QUALIFIED STATES.

    (a) Participation Authority.--Section 7(a) of the Small Business 
Act (15 U.S.C. 636(a)) is amended by adding at the end the following 
new paragraph:
            ``(22) Loan guarantees in `qualified states'.--
                    ``(A) In general.--The Administration shall 
                participate in loans to small business concerns located 
                in qualified States on a guaranteed basis in accordance 
                with the provisions of this subsection, except as 
                otherwise specifically provided in this paragraph.
                    ``(B) Guarantee amounts.--The Administration shall 
                participate in loans to small business concerns located 
                in qualified States on a guaranteed basis in an amount 
                equal to--
                            ``(i) not less than 90 percent of the 
                        balance of any loan outstanding at the time of 
                        disbursement, if the loan is not less than 
                        $200,000, nor more than $500,000; and
                            ``(ii) not less than 95 percent of the 
                        balance outstanding at the time of 
                        disbursement, if such loan is less than 
                        $200,000.
                    ``(C) Temporary exemption from guarantee fees.--The 
                Administration may not collect a guarantee fee from the 
                lending institution or the borrower in connection with 
                participation in a loan on a guaranteed basis in 
                accordance with this paragraph during the first 2 years 
                of such participation. During the third, fourth, and 
                fifth years of participation, such fees may be 
                collected in an amount equal to not more than 1 percent 
                of the outstanding balance of the guaranteed amount. 
                The fee shall be payable by the participating lending 
                institution, and may be charged to the borrower.
                    ``(D) In order to encourage lending institutions 
                and other entities making loans authorized under this 
                subsection to provide loans to small business concerns 
                located in qualified States, such lenders may retain 
                one-half of any fee collected pursuant to subparagraph 
                (C) on loans of not more than $200,000. A participating 
                lender may not retain any fee pursuant to this 
                subparagraph if the amount committed and outstanding to 
                the small business concern would be more than $200,000, 
                unless the amount in excess of $200,000 is an amount 
                that is not approved under the provisions of this 
                paragraph.
                    ``(E) Definitions.--For purposes of this 
                paragraph--
                            ``(i) the term `qualified State' means any 
                        of the several States of the United States and 
                        the District of Columbia if, during the 12-
                        month period preceding the date of enactment of 
                        this paragraph--
                                    ``(I) not less than 1 insured 
                                depository institution located in that 
                                State having total assets of not less 
                                than $100,000,000 has been closed due 
                                to the inability to meet the demands of 
                                depositors; or
                                    ``(II) not less than 2 insured 
                                depository institutions located in that 
                                State, having combined total assets of 
                                not less than $150,000,000, have been 
                                closed due to the inability to meet the 
                                demands of depositors; and
                            ``(ii) the term `insured depository 
                        institution'--
                                    ``(I) has the same meaning as in 
                                section 3 of the Federal Deposit 
                                Insurance Act; and
                                    ``(II) includes an insured credit 
                                union, as defined in section 101 of the 
                                Federal Credit Union Act.''.
    (b) Conforming Amendments.--Section 7(a) of the Small Business Act 
(15 U.S.C. 636(a)) is amended--
            (1) in paragraph (6)(A), by inserting ``or loans to assist 
        small business concerns located in qualified States, in 
        accordance with paragraph (22),'' before ``any reasonable 
        doubt''; and
            (2) in the first sentence of paragraph (18), by inserting 
        before the period ``, except as otherwise provided in paragraph 
        (22)''.

SEC. 3. PROGRAM DURATION.

    This Act, and the amendments made by this Act, shall remain in 
effect for a period of 5 years, beginning on the date of enactment of 
this Act.

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