II 109th CONGRESS 2d Session S. 3785 IN THE SENATE OF THE UNITED STATES August 3, 2006 Ms. Snowe introduced the following bill; which was read twice and referred to the Committee on Small Business and Entrepreneurship A BILL To amend the Small Business Investment Act of 1958 to improve surety bond guarantees, and for other purposes.

1.

Short title

This Act may be cited as the Surety Bond Improvement Act of 2006.

2.

Surety Bonds

(a)

Rates

Section 411(a) of the Small Business Investment Act of 1958 (15 U.S.C. 694b(a)) is amended— (1)in paragraph (1), by striking $2,000,000 and inserting $3,000,000; and (2)by adding at the end the following: (6)The Administrator may authorize a surety that issues, monitors, or services bonds under paragraph (3) to use rates approved by the insurance commissioner in the State in which such contract will be performed. . (b)

Payment of guarantees

Section 411(b) of the Small Business Investment Act of 1958 (15 U.S.C. 694b(b)) is amended— (1)by redesignating paragraphs (1) through (3) as subparagraphs (A) through (C), respectively, and adjusting the margins accordingly; (2)by striking Subject to the provisions and inserting the following: (1)

In general

Subject to the provisions ; (3)by striking : Provided, however and inserting .(2)

Conditions

For a guarantee under this subsection— ; (4)by striking In no event shall and inserting the following: (3)

Maximum amount

In no event shall ; and (5)by adding at the end the following: (4)

Payment of guarantees

The Administrator may not refuse to make payment on a guarantee under this subsection based on facts, circumstances, or defects that the Administrator reasonably should have identified during the process of making the guarantee. . (c)

Reports to Congress

(1)

In general

On the date on which the Administrator of the Small Business Administration provides notice of a proposed change in fees under section 411(h) of the Small Business Investment Act of 1958 (15 U.S.C. 694b(h)), the Administrator shall submit to the Committee on Small Business and Entrepreneurship of the Senate and the Committee on Small Business of the House of Representatives, and make publically available, a report regarding the basis for the change in fees. (2)

Contents

Each report submitted under paragraph (1) shall include— (A)the contents of any study used by the Administrator in determining whether to change fees under section 411(h) of the Small Business Investment Act of 1958; and (B)the total amount of fees received under such section 411(h) and the total cost of the program under part B of title IV of the Small Business Investment Act of 1958 (15 U.S.C. 694a et seq.)— (i)for the first report submitted under paragraph (1), during the 3-year period ending on the date of the submission of the report; and (ii)for each subsequent report, during the period beginning on the date of the submission of the prior report submitted under paragraph (1) and ending on the date of submission of such subsequent report. (d)

Sense of Congress

It is the sense of Congress that the program under part B of title IV of the Small Business Investment Act of 1958 (15 U.S.C. 694a et seq.) is not required to be self-funding and, therefore, the program may at times operate at a loss.