<enum>I</enum><header>7(a) Program</header> <section display-inline="no-display-inline" id="H0477725A8C48495D99A0E81EB824552B"><enum>101.</enum><header>Authority for fee contributions</header><text display-inline="no-display-inline">Section 7(a) of the Small Business Act (<external-xref legal-doc="usc" parsable-cite="usc/15/636">15 U.S.C. 636(a)</external-xref>) is amended—</text> <paragraph id="H4960CE91F6D74B9AA6D7B020C6B33B66"><enum>(1)</enum><text>in paragraph (18)(A) by striking <quote>shall collect</quote> and inserting <quote>shall assess and collect</quote>;</text> </paragraph> <paragraph id="HB8AE93C9117544D69FDF32FC42E7E3F"><enum>(2)</enum><text>in paragraph (18) by adding at the end the following:</text> <quoted-block display-inline="no-display-inline" id="H190F5441701A450E9CF8DA82235BCFD" style="OLC"> <subparagraph id="H0B7A54BA0CF1468B857B533465AF2BEA"><enum>(C)</enum><header>Offset</header><text>The Administrator may, as provided in paragraph (32), offset fees assessed and collected under subparagraph (A).</text> </subparagraph><after-quoted-block>;</after-quoted-block></quoted-block> </paragraph> <paragraph id="H550F639FE31B404C8B7FDC355EA2D3A3"><enum>(3)</enum><text>in paragraph (23) by striking subparagraph (C) and adding at the end the following:</text> <quoted-block display-inline="no-display-inline" id="H1D2FBB8EBBF24AC7B13E81A3575096D" style="OLC"> <subparagraph id="HEB018245EF0E44B6BBD977489518F898"><enum>(C)</enum><header>Offset</header><text>The Administrator may, as provided in paragraph (32), offset fees assessed and collected under subparagraph (A).</text> </subparagraph><after-quoted-block>; and</after-quoted-block></quoted-block> </paragraph> <paragraph id="HEAE15A1B12C747AF854453E3001833BA"><enum>(4)</enum><text>by adding at the end the following:</text> <quoted-block display-inline="no-display-inline" id="H3F938CB4E2544A6AAD6F2CBED184B56E" style="OLC"> <paragraph id="H01DEF3F38F03407CB4EACF35CDDF1F14"><enum>(32)</enum><header>Fee contributions</header> <subparagraph id="H09F11DEBE66E4707899649E8E00D870"><enum>(A)</enum><header>In general</header><text>To the extent that amounts are made available to the Administrator for the purpose of fee contributions, the Administrator shall—</text> <clause id="HB61DF010F2C748CEA43ECBC9AD4B86CC"><enum>(i)</enum><text>first consider contributing to fees paid by small business borrowers under clauses (i) through (iii) of paragraph (18)(A), to the maximum extent possible; and</text> </clause> <clause id="H32100F2833C34F60AE2EDFBF4900F87B"><enum>(ii)</enum><text>then consider contributing to fees paid by small business lenders under paragraph (23)(A).</text> </clause></subparagraph> <subparagraph id="H0CDB245A5DD44947AE8CC2B5AB3693E0"><enum>(B)</enum><header>Quarterly adjustment</header><text>Each fee contribution under subparagraph (A) shall be effective for one fiscal quarter and shall be adjusted as necessary for each fiscal quarter thereafter to ensure that the amounts under subparagraph (A) are fully used. The fee contribution for a fiscal quarter shall be based on the loans that the Administrator projects will be made during that fiscal quarter, given the program level authorized by law for that fiscal year and any other factors that the Administrator considers appropriate.</text> </subparagraph></paragraph><after-quoted-block>.</after-quoted-block></quoted-block> </paragraph></section> <section id="H80C5AC06FD454871BEF2DB49B6225BC"><enum>102.</enum><header>Rural Lending Outreach Program</header><text display-inline="no-display-inline">Section 7(a) of the Small Business Act (<external-xref legal-doc="usc" parsable-cite="usc/15/636">15 U.S.C. 636(a)</external-xref>) is amended—</text> <paragraph id="HD77551E361C54E0ABC42E12C7C344EF3"><enum>(1)</enum><text>by striking paragraph (25)(C); and</text> </paragraph> <paragraph id="H2D48A169834947048E29023ED6B20002"><enum>(2)</enum><text>by adding at the end the following:</text> <quoted-block display-inline="no-display-inline" id="HE81A6B737BC046D2B8CC123680081D74" style="OLC"> <paragraph id="H96CDF79E9AEC41899080F254278D2D8E"><enum>(33)</enum><header>Rural Lending Outreach Program</header><text display-inline="yes-display-inline">The Administrator shall carry out a rural lending outreach program to provide up to an 85 percent guaranty for loans of $250,000 or less. The program shall be carried out only through lenders located in rural areas (as <quote>rural</quote> is defined in section 501(f) of the Small Business Investment Act of 1958) or, in the case of a small business concern located in a rural area that does not have a lender located within 30 miles of the principal place of business, through any lender that is enrolled in, and administers, the 7(a) loan program that the small business concern chooses. For a loan made through the program, the following shall apply:</text> <subparagraph id="HFB43A95518EE463EAA1D68CCE82C316F"><enum>(A)</enum><text>The Administrator shall approve or disapprove the loan within 36 hours.</text> </subparagraph> <subparagraph id="H54063A4B28F245768E6762C9F04C44DB"><enum>(B)</enum><text>The program shall use abbreviated application and documentation requirements.</text> </subparagraph> <subparagraph id="H2FDC4FF4CB164E2F81E6D4455C13E9D0"><enum>(C)</enum><text>Minimum credit standards, as the Administrator considers necessary to limit the rate of default on loans made under the program, shall apply.</text> </subparagraph></paragraph><after-quoted-block>.</after-quoted-block></quoted-block> </paragraph></section> <section id="H80CD9E31992C4786BE16679F00CF8DD3"><enum>103.</enum><header>Community Express program made permanent</header> <subsection id="HD046AE4F18B64812A0666DFAE7A8DBFC"><enum>(a)</enum><header>In general</header><text display-inline="yes-display-inline">Section 7(a) of the Small Business Act (<external-xref legal-doc="usc" parsable-cite="usc/15/636">15 U.S.C. 636(a)</external-xref>) is amended by adding at the end the following:</text> <quoted-block display-inline="no-display-inline" id="HB39E2F92C5624E89AAA625702FC4F744" style="OLC"> <paragraph id="H118AD93BCDE3407C90004B551E40638F"><enum>(34)</enum><header>Community Express Program</header><text>The Administrator shall carry out a Community Express Program for loans of $250,000 or less. For a loan made under this paragraph, the following shall apply:</text> <subparagraph id="H837FE6EB4EA14BDEB62C44CFB0E4EA26"><enum>(A)</enum><text>The loan shall be made to a business concern—</text> <clause id="H5CC2BC7F6A3644858F7760434ED8D553"><enum>(i)</enum><text display-inline="yes-display-inline">the majority ownership interest of which is directly held by individuals who are women, members of qualified Indian tribes, socially or economically disadvantaged individuals (as defined by the Administrator), or veterans of the Armed Forces or members of the reserve components of the Armed Forces; or</text> </clause> <clause id="HBE7732E93B3C45E8A83F00EAB6F1ADE7"><enum>(ii)</enum><text>that is located in a low- or moderate-income area, as defined by the Administrator.</text> </clause></subparagraph> <subparagraph id="H8F807C113C4046CC8EA9CC1C2C3DEE07"><enum>(B)</enum><text>The loan shall comply with the collateral policy of the Administration, except that, if the amount of the loan is less than or equal to $25,000, the Administration shall not require the lender to take collateral.</text> </subparagraph> <subparagraph id="HFB130C7CD20949F5BFDE905E96B3D333"><enum>(C)</enum><text>The loan shall include terms requiring the lender to ensure that technical assistance is provided to the borrower, through the lender or a third-party provider.</text> </subparagraph> <subparagraph id="H0F7A51A48C84465291211716550089F6"><enum>(D)</enum><text>The Administration shall approve or disapprove the loan within 36 hours.</text> </subparagraph></paragraph><after-quoted-block>.</after-quoted-block></quoted-block> </subsection> <subsection id="H08691B3B86E34C57A3023154B3CE824C"><enum>(b)</enum><header>Notice and comment</header><text>The program required by section 7(a)(34) of the Small Business Act, as added by subsection (a), shall be established after the opportunity for notice and comment and not later than 180 days after the date of the enactment of this Act.</text> </subsection></section> <section commented="no" id="HCFA24590B9554FB4A38773492FE3CA0"><enum>104.</enum><header>Medical Professionals in Designated Shortage Areas Program</header> <subsection id="H787D8132A449494883B24CBDBF9476D7"><enum>(a)</enum><header>In general</header><text display-inline="yes-display-inline">Section 7(a) of the Small Business Act (<external-xref legal-doc="usc" parsable-cite="usc/15/636">15 U.S.C. 636(a)</external-xref>) is amended by adding at the end the following:</text> <quoted-block display-inline="no-display-inline" id="H4C11F3742F34432E945CCD57A62E4B9D" style="OLC"> <paragraph commented="no" id="H41A5B672C7C54904A18078ECE9AA73B0"><enum>(35)</enum><header>Medical Professionals in Designated Shortage Areas Program</header><text>The Administrator shall carry out a Medical Professionals in Designated Shortage Areas Program. For a loan made under this paragraph, the following shall apply:</text> <subparagraph commented="no" id="H50714B87962E4F2992FC9B2FB2C1F534"><enum>(A)</enum><text>The loan shall be made to a business concern that provides properly licensed medical, dental, or psychiatric services to the public.</text> </subparagraph> <subparagraph id="HAF795C82F9084003AA70BE79257FCED6"><enum>(B)</enum><text>The loan shall be for the purpose of opening a business concern in a health professional shortage area (as defined in section 332 of the Public Health Service Act (<external-xref legal-doc="usc" parsable-cite="usc/42/254e">42 U.S.C. 254e</external-xref>)).</text> </subparagraph> <subparagraph id="HA761E449C0854FA29D6405B7D1F6AC5D"><enum>(C)</enum><text>The loan shall include the participation by the Administration equal to 90 percent of the balance of the financing outstanding at the time of disbursement.</text> </subparagraph> <subparagraph commented="no" id="H4E44E017924A4B5AB383B949563FD487"><enum>(D)</enum><text>The fees on the loan under paragraphs (18) and (23) shall be reduced by half.</text> </subparagraph></paragraph><after-quoted-block>.</after-quoted-block></quoted-block> </subsection> <subsection id="H2A183B75DB7142880009498D5E7355A5"><enum>(b)</enum><header>Notice and comment</header><text display-inline="yes-display-inline">The program required by section 7(a)(35) of the Small Business Act, as added by subsection (a), shall be established after the opportunity for notice and comment and not later than 180 days after the date of the enactment of this Act.</text> </subsection></section> <section commented="no" id="H363148C2B32F4FF5A9B0D66CBB6308E9"><enum>105.</enum><header>Increased Veteran Participation Program</header> <subsection id="H6D73F12BB59D4C12A249124583D0D0F3"><enum>(a)</enum><header>In general</header><text display-inline="yes-display-inline">Section 7(a) of the Small Business Act (<external-xref legal-doc="usc" parsable-cite="usc/15/636">15 U.S.C. 636(a)</external-xref>) is amended by adding at the end the following:</text> <quoted-block display-inline="no-display-inline" id="HFC2BCB2C8C694BCC946498E1C38C5195" style="OLC"> <paragraph commented="no" id="HE4446D93BFD04746B3A3463B00143442"><enum>(36)</enum><header>Increased Veteran Participation Program</header><text>The Administrator shall carry out an Increased Veteran Participation Program. For a loan made under this paragraph, the following shall apply:</text> <subparagraph id="HF34E12A7CC1640D2A7BA5FB28CD46254"><enum>(A)</enum><text display-inline="yes-display-inline">The loan shall be made to a business concern the majority ownership interest of which is directly held by individuals who are veterans of the Armed Forces or members of the reserve components of the Armed Forces.</text> </subparagraph> <subparagraph commented="no" id="HBE91013961DE4283A4A350353782F58B"><enum>(B)</enum><text display-inline="yes-display-inline">The loan shall include the participation by the Administration equal to 90 percent of the balance of the financing outstanding at the time of disbursement.</text> </subparagraph> <subparagraph commented="no" id="H89EA12FD574547E89B4B0600257C8DB8"><enum>(C)</enum><text>The fees on the loan under paragraphs (18) and (23) shall not apply.</text> </subparagraph></paragraph><after-quoted-block>.</after-quoted-block></quoted-block> </subsection> <subsection id="HB58F226E12594619B8954438A298F5DD"><enum>(b)</enum><header>Notice and comment</header><text display-inline="yes-display-inline">The program required by section 7(a)(36) of the Small Business Act, as added by subsection (a), shall be established after the opportunity for notice and comment and not later than 180 days after the date of the enactment of this Act.</text> </subsection></section> <section id="H1EA775C23B62444294735E4138596273"><enum>106.</enum><header>Alternative size standard</header> <subsection id="H0B37BDE923EA448DBDE53B7D01E8E800"><enum>(a)</enum><header>In general</header><text display-inline="yes-display-inline">Section 3(a) of the Small Business Act (<external-xref legal-doc="usc" parsable-cite="usc/15/632">15 U.S.C. 632(a)</external-xref>) is amended by adding at the end the following:</text> <quoted-block display-inline="no-display-inline" id="HA7D54414F04D48BDA8CC4B35B8AA648" style="OLC"> <paragraph id="H02870ADD6D894EC7A3C2BE22B521FFAF"><enum>(5)</enum><text display-inline="yes-display-inline">In addition to any other size standard under this subsection, the Administrator shall establish, and permit a lender making a loan under section 7(a) and a lender making a loan under the development company loan program to use, an alternative size standard. The alternative size standard shall be based on factors including maximum tangible net worth and average net income.</text> </paragraph><after-quoted-block>.</after-quoted-block></quoted-block> </subsection> <subsection id="H947EBB6D21B94E6C971088E6A961A41C"><enum>(b)</enum><header>Applicability</header><text display-inline="yes-display-inline">Until the Administrator establishes, under section 3(a)(5) of the Small Business Act (as added by subsection (a)), an alternative size standard in the case of a lender making a loan under section 7(a) of that Act, the alternative size standard in <external-xref legal-doc="regulation" parsable-cite="cfr/13/121.301">section 121.301(b)</external-xref> of title 13, Code of Federal Regulations, shall apply to such a case.</text> </subsection></section> <section id="HB77D67817664408D929C27C507CB1BE2"><enum>107.</enum><header>Support to regional offices</header><text display-inline="no-display-inline">Section 7(a) of the Small Business Act (<external-xref legal-doc="usc" parsable-cite="usc/15/636">15 U.S.C. 636(a)</external-xref>) is amended by adding at the end the following:</text> <quoted-block display-inline="no-display-inline" id="H786C6E72AEA14A8CA655002BA41F79B2" style="OLC"> <paragraph id="HF18B24BE5E90412D8EB49BBA64AA872C"><enum>(37)</enum><header>Support to regional offices</header><text>The Administrator shall carry out a program, within an element of the Administration already in existence as of the date of the enactment of the , to provide support to regional offices of the Administration in assisting small lenders who do not participate in the preferred lender program to participate in the 7(a) program.</text> </paragraph><after-quoted-block>.</after-quoted-block></quoted-block> </section>

110 HR 1332 PCS: Small Business Lending Improvements Act of 2007 U.S. House of Representatives 0 text/xml EN Pursuant to Title 17 Section 105 of the United States Code, this file is not subject to copyright protection and is in the public domain.

Short title; table of contents

(a)

Short title

This Act may be cited as the

Small Business Lending Improvements Act of 2007

. (b)

Table of contents

The table of contents for this Act is as follows:

Sec. 1. Short title; table of contents.

Title I—7(a) Program

Sec. 101. Authority for fee contributions.

Sec. 102. Rural Lending Outreach Program.

Sec. 103. Community Express program made permanent.

Sec. 104. Medical Professionals in Designated Shortage Areas Program.

Sec. 105. Increased Veteran Participation Program.

Sec. 106. Alternative size standard.

Sec. 107. Support to regional offices.

Title II—Certified Development Company Economic Development Loan Program

Sec. 201. Certified Development Company Economic Development Loan Program.

Sec. 202. Definitions.

Sec. 203. Eligibility of development companies to be designated as certified development companies.

Sec. 204. Definition of rural areas.

Sec. 205. Businesses in low-income areas.

Sec. 206. Combinations of certain goals.

Sec. 207. Refinancing.

Sec. 208. Additional equity injections.

Sec. 209. Loan liquidations.

Sec. 210. Closing costs.

Sec. 211. Maximum Certified Development Company and 7(a) loan eligibility.

Sec. 212. Eligibility for energy efficiency projects.

Sec. 213. Loans for plant projects used for energy-efficient purposes.

Sec. 214. Extension of period during which loss reserves of premier certified lenders determined on the basis of outstanding balance of debentures.

Sec. 215. Extension of alternative loss reserve pilot program for certain premier certified lenders.

<enum>I</enum><header>7(a) Program</header> <section display-inline="no-display-inline" id="H0477725A8C48495D99A0E81EB824552B"><enum>101.</enum><header>Authority for fee contributions</header><text display-inline="no-display-inline">Section 7(a) of the Small Business Act (<external-xref legal-doc="usc" parsable-cite="usc/15/636">15 U.S.C. 636(a)</external-xref>) is amended—</text> <paragraph id="H4960CE91F6D74B9AA6D7B020C6B33B66"><enum>(1)</enum><text>in paragraph (18)(A) by striking <quote>shall collect</quote> and inserting <quote>shall assess and collect</quote>;</text> </paragraph> <paragraph id="HB8AE93C9117544D69FDF32FC42E7E3F"><enum>(2)</enum><text>in paragraph (18) by adding at the end the following:</text> <quoted-block display-inline="no-display-inline" id="H190F5441701A450E9CF8DA82235BCFD" style="OLC"> <subparagraph id="H0B7A54BA0CF1468B857B533465AF2BEA"><enum>(C)</enum><header>Offset</header><text>The Administrator may, as provided in paragraph (32), offset fees assessed and collected under subparagraph (A).</text> </subparagraph><after-quoted-block>;</after-quoted-block></quoted-block> </paragraph> <paragraph id="H550F639FE31B404C8B7FDC355EA2D3A3"><enum>(3)</enum><text>in paragraph (23) by striking subparagraph (C) and adding at the end the following:</text> <quoted-block display-inline="no-display-inline" id="H1D2FBB8EBBF24AC7B13E81A3575096D" style="OLC"> <subparagraph id="HEB018245EF0E44B6BBD977489518F898"><enum>(C)</enum><header>Offset</header><text>The Administrator may, as provided in paragraph (32), offset fees assessed and collected under subparagraph (A).</text> </subparagraph><after-quoted-block>; and</after-quoted-block></quoted-block> </paragraph> <paragraph id="HEAE15A1B12C747AF854453E3001833BA"><enum>(4)</enum><text>by adding at the end the following:</text> <quoted-block display-inline="no-display-inline" id="H3F938CB4E2544A6AAD6F2CBED184B56E" style="OLC"> <paragraph id="H01DEF3F38F03407CB4EACF35CDDF1F14"><enum>(32)</enum><header>Fee contributions</header> <subparagraph id="H09F11DEBE66E4707899649E8E00D870"><enum>(A)</enum><header>In general</header><text>To the extent that amounts are made available to the Administrator for the purpose of fee contributions, the Administrator shall—</text> <clause id="HB61DF010F2C748CEA43ECBC9AD4B86CC"><enum>(i)</enum><text>first consider contributing to fees paid by small business borrowers under clauses (i) through (iii) of paragraph (18)(A), to the maximum extent possible; and</text> </clause> <clause id="H32100F2833C34F60AE2EDFBF4900F87B"><enum>(ii)</enum><text>then consider contributing to fees paid by small business lenders under paragraph (23)(A).</text> </clause></subparagraph> <subparagraph id="H0CDB245A5DD44947AE8CC2B5AB3693E0"><enum>(B)</enum><header>Quarterly adjustment</header><text>Each fee contribution under subparagraph (A) shall be effective for one fiscal quarter and shall be adjusted as necessary for each fiscal quarter thereafter to ensure that the amounts under subparagraph (A) are fully used. The fee contribution for a fiscal quarter shall be based on the loans that the Administrator projects will be made during that fiscal quarter, given the program level authorized by law for that fiscal year and any other factors that the Administrator considers appropriate.</text> </subparagraph></paragraph><after-quoted-block>.</after-quoted-block></quoted-block> </paragraph></section> <section id="H80C5AC06FD454871BEF2DB49B6225BC"><enum>102.</enum><header>Rural Lending Outreach Program</header><text display-inline="no-display-inline">Section 7(a) of the Small Business Act (<external-xref legal-doc="usc" parsable-cite="usc/15/636">15 U.S.C. 636(a)</external-xref>) is amended—</text> <paragraph id="HD77551E361C54E0ABC42E12C7C344EF3"><enum>(1)</enum><text>by striking paragraph (25)(C); and</text> </paragraph> <paragraph id="H2D48A169834947048E29023ED6B20002"><enum>(2)</enum><text>by adding at the end the following:</text> <quoted-block display-inline="no-display-inline" id="HE81A6B737BC046D2B8CC123680081D74" style="OLC"> <paragraph id="H96CDF79E9AEC41899080F254278D2D8E"><enum>(33)</enum><header>Rural Lending Outreach Program</header><text display-inline="yes-display-inline">The Administrator shall carry out a rural lending outreach program to provide up to an 85 percent guaranty for loans of $250,000 or less. The program shall be carried out only through lenders located in rural areas (as <quote>rural</quote> is defined in section 501(f) of the Small Business Investment Act of 1958) or, in the case of a small business concern located in a rural area that does not have a lender located within 30 miles of the principal place of business, through any lender that is enrolled in, and administers, the 7(a) loan program that the small business concern chooses. For a loan made through the program, the following shall apply:</text> <subparagraph id="HFB43A95518EE463EAA1D68CCE82C316F"><enum>(A)</enum><text>The Administrator shall approve or disapprove the loan within 36 hours.</text> </subparagraph> <subparagraph id="H54063A4B28F245768E6762C9F04C44DB"><enum>(B)</enum><text>The program shall use abbreviated application and documentation requirements.</text> </subparagraph> <subparagraph id="H2FDC4FF4CB164E2F81E6D4455C13E9D0"><enum>(C)</enum><text>Minimum credit standards, as the Administrator considers necessary to limit the rate of default on loans made under the program, shall apply.</text> </subparagraph></paragraph><after-quoted-block>.</after-quoted-block></quoted-block> </paragraph></section> <section id="H80CD9E31992C4786BE16679F00CF8DD3"><enum>103.</enum><header>Community Express program made permanent</header> <subsection id="HD046AE4F18B64812A0666DFAE7A8DBFC"><enum>(a)</enum><header>In general</header><text display-inline="yes-display-inline">Section 7(a) of the Small Business Act (<external-xref legal-doc="usc" parsable-cite="usc/15/636">15 U.S.C. 636(a)</external-xref>) is amended by adding at the end the following:</text> <quoted-block display-inline="no-display-inline" id="HB39E2F92C5624E89AAA625702FC4F744" style="OLC"> <paragraph id="H118AD93BCDE3407C90004B551E40638F"><enum>(34)</enum><header>Community Express Program</header><text>The Administrator shall carry out a Community Express Program for loans of $250,000 or less. For a loan made under this paragraph, the following shall apply:</text> <subparagraph id="H837FE6EB4EA14BDEB62C44CFB0E4EA26"><enum>(A)</enum><text>The loan shall be made to a business concern—</text> <clause id="H5CC2BC7F6A3644858F7760434ED8D553"><enum>(i)</enum><text display-inline="yes-display-inline">the majority ownership interest of which is directly held by individuals who are women, members of qualified Indian tribes, socially or economically disadvantaged individuals (as defined by the Administrator), or veterans of the Armed Forces or members of the reserve components of the Armed Forces; or</text> </clause> <clause id="HBE7732E93B3C45E8A83F00EAB6F1ADE7"><enum>(ii)</enum><text>that is located in a low- or moderate-income area, as defined by the Administrator.</text> </clause></subparagraph> <subparagraph id="H8F807C113C4046CC8EA9CC1C2C3DEE07"><enum>(B)</enum><text>The loan shall comply with the collateral policy of the Administration, except that, if the amount of the loan is less than or equal to $25,000, the Administration shall not require the lender to take collateral.</text> </subparagraph> <subparagraph id="HFB130C7CD20949F5BFDE905E96B3D333"><enum>(C)</enum><text>The loan shall include terms requiring the lender to ensure that technical assistance is provided to the borrower, through the lender or a third-party provider.</text> </subparagraph> <subparagraph id="H0F7A51A48C84465291211716550089F6"><enum>(D)</enum><text>The Administration shall approve or disapprove the loan within 36 hours.</text> </subparagraph></paragraph><after-quoted-block>.</after-quoted-block></quoted-block> </subsection> <subsection id="H08691B3B86E34C57A3023154B3CE824C"><enum>(b)</enum><header>Notice and comment</header><text>The program required by section 7(a)(34) of the Small Business Act, as added by subsection (a), shall be established after the opportunity for notice and comment and not later than 180 days after the date of the enactment of this Act.</text> </subsection></section> <section commented="no" id="HCFA24590B9554FB4A38773492FE3CA0"><enum>104.</enum><header>Medical Professionals in Designated Shortage Areas Program</header> <subsection id="H787D8132A449494883B24CBDBF9476D7"><enum>(a)</enum><header>In general</header><text display-inline="yes-display-inline">Section 7(a) of the Small Business Act (<external-xref legal-doc="usc" parsable-cite="usc/15/636">15 U.S.C. 636(a)</external-xref>) is amended by adding at the end the following:</text> <quoted-block display-inline="no-display-inline" id="H4C11F3742F34432E945CCD57A62E4B9D" style="OLC"> <paragraph commented="no" id="H41A5B672C7C54904A18078ECE9AA73B0"><enum>(35)</enum><header>Medical Professionals in Designated Shortage Areas Program</header><text>The Administrator shall carry out a Medical Professionals in Designated Shortage Areas Program. For a loan made under this paragraph, the following shall apply:</text> <subparagraph commented="no" id="H50714B87962E4F2992FC9B2FB2C1F534"><enum>(A)</enum><text>The loan shall be made to a business concern that provides properly licensed medical, dental, or psychiatric services to the public.</text> </subparagraph> <subparagraph id="HAF795C82F9084003AA70BE79257FCED6"><enum>(B)</enum><text>The loan shall be for the purpose of opening a business concern in a health professional shortage area (as defined in section 332 of the Public Health Service Act (<external-xref legal-doc="usc" parsable-cite="usc/42/254e">42 U.S.C. 254e</external-xref>)).</text> </subparagraph> <subparagraph id="HA761E449C0854FA29D6405B7D1F6AC5D"><enum>(C)</enum><text>The loan shall include the participation by the Administration equal to 90 percent of the balance of the financing outstanding at the time of disbursement.</text> </subparagraph> <subparagraph commented="no" id="H4E44E017924A4B5AB383B949563FD487"><enum>(D)</enum><text>The fees on the loan under paragraphs (18) and (23) shall be reduced by half.</text> </subparagraph></paragraph><after-quoted-block>.</after-quoted-block></quoted-block> </subsection> <subsection id="H2A183B75DB7142880009498D5E7355A5"><enum>(b)</enum><header>Notice and comment</header><text display-inline="yes-display-inline">The program required by section 7(a)(35) of the Small Business Act, as added by subsection (a), shall be established after the opportunity for notice and comment and not later than 180 days after the date of the enactment of this Act.</text> </subsection></section> <section commented="no" id="H363148C2B32F4FF5A9B0D66CBB6308E9"><enum>105.</enum><header>Increased Veteran Participation Program</header> <subsection id="H6D73F12BB59D4C12A249124583D0D0F3"><enum>(a)</enum><header>In general</header><text display-inline="yes-display-inline">Section 7(a) of the Small Business Act (<external-xref legal-doc="usc" parsable-cite="usc/15/636">15 U.S.C. 636(a)</external-xref>) is amended by adding at the end the following:</text> <quoted-block display-inline="no-display-inline" id="HFC2BCB2C8C694BCC946498E1C38C5195" style="OLC"> <paragraph commented="no" id="HE4446D93BFD04746B3A3463B00143442"><enum>(36)</enum><header>Increased Veteran Participation Program</header><text>The Administrator shall carry out an Increased Veteran Participation Program. For a loan made under this paragraph, the following shall apply:</text> <subparagraph id="HF34E12A7CC1640D2A7BA5FB28CD46254"><enum>(A)</enum><text display-inline="yes-display-inline">The loan shall be made to a business concern the majority ownership interest of which is directly held by individuals who are veterans of the Armed Forces or members of the reserve components of the Armed Forces.</text> </subparagraph> <subparagraph commented="no" id="HBE91013961DE4283A4A350353782F58B"><enum>(B)</enum><text display-inline="yes-display-inline">The loan shall include the participation by the Administration equal to 90 percent of the balance of the financing outstanding at the time of disbursement.</text> </subparagraph> <subparagraph commented="no" id="H89EA12FD574547E89B4B0600257C8DB8"><enum>(C)</enum><text>The fees on the loan under paragraphs (18) and (23) shall not apply.</text> </subparagraph></paragraph><after-quoted-block>.</after-quoted-block></quoted-block> </subsection> <subsection id="HB58F226E12594619B8954438A298F5DD"><enum>(b)</enum><header>Notice and comment</header><text display-inline="yes-display-inline">The program required by section 7(a)(36) of the Small Business Act, as added by subsection (a), shall be established after the opportunity for notice and comment and not later than 180 days after the date of the enactment of this Act.</text> </subsection></section> <section id="H1EA775C23B62444294735E4138596273"><enum>106.</enum><header>Alternative size standard</header> <subsection id="H0B37BDE923EA448DBDE53B7D01E8E800"><enum>(a)</enum><header>In general</header><text display-inline="yes-display-inline">Section 3(a) of the Small Business Act (<external-xref legal-doc="usc" parsable-cite="usc/15/632">15 U.S.C. 632(a)</external-xref>) is amended by adding at the end the following:</text> <quoted-block display-inline="no-display-inline" id="HA7D54414F04D48BDA8CC4B35B8AA648" style="OLC"> <paragraph id="H02870ADD6D894EC7A3C2BE22B521FFAF"><enum>(5)</enum><text display-inline="yes-display-inline">In addition to any other size standard under this subsection, the Administrator shall establish, and permit a lender making a loan under section 7(a) and a lender making a loan under the development company loan program to use, an alternative size standard. The alternative size standard shall be based on factors including maximum tangible net worth and average net income.</text> </paragraph><after-quoted-block>.</after-quoted-block></quoted-block> </subsection> <subsection id="H947EBB6D21B94E6C971088E6A961A41C"><enum>(b)</enum><header>Applicability</header><text display-inline="yes-display-inline">Until the Administrator establishes, under section 3(a)(5) of the Small Business Act (as added by subsection (a)), an alternative size standard in the case of a lender making a loan under section 7(a) of that Act, the alternative size standard in <external-xref legal-doc="regulation" parsable-cite="cfr/13/121.301">section 121.301(b)</external-xref> of title 13, Code of Federal Regulations, shall apply to such a case.</text> </subsection></section> <section id="HB77D67817664408D929C27C507CB1BE2"><enum>107.</enum><header>Support to regional offices</header><text display-inline="no-display-inline">Section 7(a) of the Small Business Act (<external-xref legal-doc="usc" parsable-cite="usc/15/636">15 U.S.C. 636(a)</external-xref>) is amended by adding at the end the following:</text> <quoted-block display-inline="no-display-inline" id="H786C6E72AEA14A8CA655002BA41F79B2" style="OLC"> <paragraph id="HF18B24BE5E90412D8EB49BBA64AA872C"><enum>(37)</enum><header>Support to regional offices</header><text>The Administrator shall carry out a program, within an element of the Administration already in existence as of the date of the enactment of the , to provide support to regional offices of the Administration in assisting small lenders who do not participate in the preferred lender program to participate in the 7(a) program.</text> </paragraph><after-quoted-block>.</after-quoted-block></quoted-block> </section> <enum>II</enum><header>Certified Development Company Economic Development Loan Program</header> <section id="H6C397C45EDB94D4EB67FF8616F9BC53F"><enum>201.</enum><header>Certified Development Company Economic Development Loan Program</header><text display-inline="no-display-inline">Section 504 of the Small Business Investment Act of 1958 (<external-xref legal-doc="usc" parsable-cite="usc/15/697a">15 U.S.C. 697a</external-xref>) is amended—</text> <paragraph id="HDA89FB90A24F4AC19654B139BB2FC661"><enum>(1)</enum><text>by redesignating subsections (a) and (b) as subsections (b) and (c); and</text> </paragraph> <paragraph id="H4AE5891FE1234CEF8BDB9115EE8E0023"><enum>(2)</enum><text>by inserting before subsection (b) (as so redesignated) the following:</text> <quoted-block display-inline="no-display-inline" id="H7689C1641BFF47F8A803237C71ED7B2E" style="OLC"> <subsection id="H0A01FE9458014EE5812808B375905795"><enum>(a)</enum><text display-inline="yes-display-inline">The program to provide financing to small businesses by guarantees of loans under this Act which are funded by debentures guaranteed by the Administration may be known as the <quote>Certified Development Company Economic Development Loan Program</quote>.</text> </subsection><after-quoted-block>.</after-quoted-block></quoted-block> </paragraph></section> <section id="HA3DDEE93E76D4FC9B6D098B347856C4D"><enum>202.</enum><header>Definitions</header><text display-inline="no-display-inline">Section 103(6) of the Small Business Investment Act of 1958 (<external-xref legal-doc="usc" parsable-cite="usc/15/662">15 U.S.C. 662(6)</external-xref>) is amended to read as follows:</text> <quoted-block display-inline="no-display-inline" id="H52D1AAF5B5E748EAB6C04EA76DB3AF97" style="OLC"> <paragraph id="H6C909F8904E84CA0B63C95FA55C8F05"><enum>(6)</enum><text display-inline="yes-display-inline">the term <term>development company</term> means an entity incorporated under State law with the authority to promote and assist the growth and development of small-business concerns in the areas in which it is authorized to operate by the Administration, and the term <term>certified development company</term> means a development company which the Administration has determined meets the criteria of section 506;</text> </paragraph><after-quoted-block>.</after-quoted-block></quoted-block> </section> <section id="H1320412F027F4A43A44DACD693C3CB00"><enum>203.</enum><header>Eligibility of development companies to be designated as certified development companies</header><text display-inline="no-display-inline">Section 506 of the Small Business Investment Act of 1958 (<external-xref legal-doc="usc" parsable-cite="usc/15/697c">15 U.S.C. 697c</external-xref>) is amended to read as follows:</text> <quoted-block display-inline="no-display-inline" id="HC6B6E69A194D4E33A8A003383DDEDF71" style="OLC"> <section id="H2562FC89CB614AE092A7D8C4C506FA29"><enum>506.</enum><header>Certified Development Companies</header> <subsection id="H6F4C41C31DFB452DAC63FC42E3DB6E1E"><enum>(a)</enum><header>Authority To issue debentures</header><text display-inline="yes-display-inline">A development company may issue debentures pursuant to this Act if the Administration certifies that the company meets the following criteria:</text> <paragraph id="H36497A050D06471982C68C005C5CE490"><enum>(1)</enum><header>Size</header><text>The development company is required to be a small concern with fewer than 500 employees and not under the control of any entity which does not meet the Administration’s size standards as a small business, except that any development company which was certified by the Administration prior to December 31, 2005 may continue to issue debentures.</text> </paragraph> <paragraph id="H1E18FB95626745DA8701432B748FCD97"><enum>(2)</enum><header>Purpose</header><text>The primary purpose of the development company is to benefit the community by fostering economic development to create and preserve jobs and stimulate private investment.</text> </paragraph> <paragraph id="H50ECB7FC791A4B1F88153C9B19CC55EE"><enum>(3)</enum><header>Primary function</header><text display-inline="yes-display-inline">The primary function of the development company is to accomplish its purpose by providing long term financing to small businesses by the utilization of the Certified Development Company Economic Development Loan Program. It may also provide or support such other local economic development activities to assist the community.</text> </paragraph> <paragraph id="H7C99FBD7B6864836AED84B7C31A3423F"><enum>(4)</enum><header>Non-profit status</header><text>The development company is a non-profit corporation, except that a development company certified by the Administration prior to January 1, 1987, may retain its status as a for-profit corporation.</text> </paragraph> <paragraph id="H70937D4A747D42C9A94E3B947B001F5B"><enum>(5)</enum><header>Good standing</header><text>The development company is in good standing in its State of incorporation and in any other State in which it conducts business, and is in compliance with all laws, including taxation requirements, in its State of incorporation and in any other State in which it conducts business.</text> </paragraph> <paragraph id="H3806F67DEEFE4099000651FF83ABC39"><enum>(6)</enum><header>Membership</header><text>The development company has at least 25 members (or stockholders if the corporation is a for-profit entity), none of whom may own or control more than 10 percent of the company’s voting membership, consisting of representation from each of the following groups (none of which are in a position to control the development company):</text> <subparagraph id="H96F5EDF742E84D0680A2BC8D02ABA646"><enum>(A)</enum><text>Government organizations that are responsible for economic development.</text> </subparagraph> <subparagraph id="H91A849FA0ED348FCBE848DEC53216B6"><enum>(B)</enum><text>Financial institutions that provide commercial long term fixed asset financing.</text> </subparagraph> <subparagraph id="H466E8F4B73AB4A0294B1FA93B8C80018"><enum>(C)</enum><text>Community organizations that are dedicated to economic development.</text> </subparagraph> <subparagraph id="H8A4530865D364CA78E96E846FA14BF69"><enum>(D)</enum><text>Businesses.</text> </subparagraph></paragraph> <paragraph id="HAAFB8E1AFC8B4F858FBBD76DB82603DF"><enum>(7)</enum><header>Board of directors</header><text>The development company has a board of directors that—</text> <subparagraph id="H0F31AE7C9D90489E8DC736D89ECB734"><enum>(A)</enum><text>is elected from the membership by the members;</text> </subparagraph> <subparagraph id="HA298C78F81504B0F82FDE2A485831FC7"><enum>(B)</enum><text>represents at least three of the four groups enumerated in subsection (a)(6) and no group is in a position to control the company; and</text> </subparagraph> <subparagraph id="HB0C3DB3EFA354B85A5B9BE94CEE0AE96"><enum>(C)</enum><text>meets on a regular basis to make policy decisions for such company.</text> </subparagraph></paragraph> <paragraph id="H09C6935DE5F542BE904800EBC852AAF6"><enum>(8)</enum><header>Professional management and staff</header><text display-inline="yes-display-inline">The development company has full-time professional management, including a chief executive officer to manage daily operations, and a full-time professional staff qualified to market the Certified Development Company Economic Development Loan Program and handle all aspects of loan approval and servicing, including liquidation, if appropriate. The development company is required to be independently managed and operated to pursue its economic development mission and to employ its chief executive officer directly, with the following exceptions:</text> <subparagraph id="H178EA882C2C94C268E779B638ED849C6"><enum>(A)</enum><text>A development company may be an affiliate of another local non-profit service corporation (specifically excluding another development company) whose mission is to support economic development in the area in which the development company operates. In such a case:</text> <clause id="HC9CEAC175E604E119BB6DD645481753"><enum>(i)</enum><text>The development company may satisfy the requirement for full-time professional staff by contracting with a local non-profit service corporation (or one of its non-profit affiliates), or a governmental or quasi-governmental agency, to provide the required staffing.</text> </clause> <clause id="HAE2A995776B544758521E098DB2FE25E"><enum>(ii)</enum><text>The development company and the local non-profit service corporation may have partially common boards of directors.</text> </clause></subparagraph> <subparagraph id="H5FB2D65BD19F4EE49D08A291858B42FF"><enum>(B)</enum><text>A development company in a rural area (as defined in section 501(f)) shall be deemed to have satisfied the requirements of a full-time professional staff and professional management ability if it contracts with another certified development company which has such staff and management ability and which is located in the same general area to provide such services.</text> </subparagraph> <subparagraph id="H18CCE08BB4164C79844E9844B00A77F"><enum>(C)</enum><text>A development company that has been certified by the Administration as of December 31, 2005, and that has contracted with a for-profit company to provide services as of such date may continue to do so.</text> </subparagraph></paragraph></subsection> <subsection id="H6179030BCC6F49E0B6C4A773B79BC65"><enum>(b)</enum><header>Area of operations</header><text>The Administration shall specify the area in which an applicant is certified to provide assistance to small businesses under this title, which may not initially exceed its State of incorporation unless it proposes to operate in a local economic area which is required to include part of its State of incorporation and may include adjacent areas within several States. After a development company has demonstrated its ability to provide assistance in its area of operations, it may request the Administration to be allowed to operate in one or more additional States as a multi-state certified development company if it satisfies the following criteria:</text> <paragraph id="HF16B5C7731DC43F989895017DB2988B4"><enum>(1)</enum><text>Each additional State is contiguous to the State of incorporation, except the States of Alaska and Hawaii shall be deemed to be contiguous to any State abutting the Pacific ocean.</text> </paragraph> <paragraph id="H98428DBE7C5B43D994DA1EB09F822FE1"><enum>(2)</enum><text display-inline="yes-display-inline">It demonstrates its proficiency in making and servicing loans under the Certified Development Company Economic Development Loan Program by—</text> <subparagraph id="HDE589547D1114C6DAA074F065EE5F51E"><enum>(A)</enum><text>requesting and receiving designation as an accredited lender under section 507 or a premier certified lender under section 508; and</text> </subparagraph> <subparagraph id="H16A5A54A36CD406F9DC85E5BFFFD042"><enum>(B)</enum><text>meeting or exceeding performance standards established by the Administration.</text> </subparagraph></paragraph> <paragraph id="HFEF161ECA6B14871A11D6765ECFB63BA"><enum>(3)</enum><text>The development company adds to the membership of its State of incorporation additional membership from each additional State and the added membership meets the requirements of subsection (a)(6).</text> </paragraph> <paragraph id="HD357A4562C2D4B05B3A365754FEF07A4"><enum>(4)</enum><text>The development company adds at least one member to its board of directors in the State of incorporation, providing that added member was selected by the membership of the development company.</text> </paragraph> <paragraph id="H96F2D501B2CF453AB2EF77F7FD1F4E44"><enum>(5)</enum><text>The company meets such other criteria or complies with such conditions as the Administration deems appropriate.</text> </paragraph></subsection> <subsection id="H659853CDD0EF4F7EAD05393FD3A44439"><enum>(c)</enum><header>Processing of expansion applications</header><text>The Administration shall respond to the request of a certified development company for certification as a multi-state company on an expedited basis within 30 days of receipt of a completed application if the application demonstrates that the development company meets the requirements of subsection (b)(1) through (b)(4).</text> </subsection> <subsection id="H71FC2C10D3554A9AA669BD28CDFD47A8"><enum>(d)</enum><header>Use of funds limited to State where generated</header><text display-inline="yes-display-inline">Any funds generated by a development company from making loans under the Certified Development Company Economic Development Loan Program which remain after payment of staff, operating and overhead expenses shall be retained by the development company as a reserve for future operations, for expanding its area of operations in a local economic area as authorized by the Administration, or for investment in other local economic development activity in the State from which the funds were generated.</text> </subsection> <subsection id="H4A164108ED0C4A11BA01B2DF118C1CEB"><enum>(e)</enum><header>Ethical requirements</header> <paragraph id="H165F241098A9475FA960D8975EF78062"><enum>(1)</enum><header>In general</header><text>Certified development companies, their officers, employees and other staff, shall at all times act ethically and avoid activities which constitute a conflict of interest or appear to constitute a conflict of interest. No one may serve as an officer, director or chief executive officer of more than one certified development company.</text> </paragraph> <paragraph id="H4EF57D81903C476BB7A8BB773D699D25"><enum>(2)</enum><header>Prohibited conflict in project loans</header><text display-inline="yes-display-inline">As part of a project under the Certified Development Company Economic Development Loan Program, no certified development company may recommend or approve a guarantee of a debenture by the Administration that is collateralized by a second lien position on the property being constructed or acquired and also provide, or be affiliated with a corporation or other entity, for-profit or non-profit, which provides, financing collateralized by a first lien on the same property. A business development company that was participating as a first mortgage lender, either directly or through an affiliate, for the Certified Development Company Economic Development Loan Program in either fiscal years 2004 or 2005 may continue to do so.</text> </paragraph> <paragraph id="H4D1792E251224F9AB60790E0CD006C2C"><enum>(3)</enum><header>Other economic development activities</header><text>Operation of multiple programs to assist small business concerns in order for a certified development company to carry out its economic development mission shall not be deemed a conflict of interest, but notwithstanding any other provision of law, no development company may accept funding from any source, including but not limited to any department or agency of the United States Government—</text> <subparagraph id="HA1B861A2E329476CB35F32C280893855"><enum>(A)</enum><text>if such funding includes any conditions, priorities or restrictions upon the types of small businesses to which they may provide financial assistance under this title; or</text> </subparagraph> <subparagraph id="HE0E6EB58AD084B310094F310A7D43024"><enum>(B)</enum><text>if it includes any conditions or imposes any requirements, directly or indirectly, upon any recipient of assistance under this title unless the department or agency also provides all of the financial assistance to be delivered by the development company to the small business and such conditions, priorities or restrictions are limited solely to the financial assistance so provided.</text> </subparagraph></paragraph></subsection></section><after-quoted-block>.</after-quoted-block></quoted-block> </section> <section id="H1B092720E5DB4536BE68A172EBDF2968"><enum>204.</enum><header>Definition of rural areas</header><text display-inline="no-display-inline">Section 501 of the Small Business Investment Act of 1958 (<external-xref legal-doc="usc" parsable-cite="usc/15/695">15 U.S.C. 695</external-xref>) is amended by adding at the end the following new subsection:</text> <quoted-block display-inline="no-display-inline" id="H1D96F283C5904C8C8543DCB287581DC5" style="OLC"> <subsection id="H8568EE4A4171400300D1B7F008E19F5F"><enum>(f)</enum><text display-inline="yes-display-inline">As used in subsection (d)(3)(D), the term <term>rural</term> shall include any area other than—</text> <paragraph id="H37873BFC97664C30B275B918BAA761AF"><enum>(1)</enum><text>a city or town that has a population greater than 50,000 inhabitants; and</text> </paragraph> <paragraph id="H2DB03E4A945A45098E705BE466E6E4EA"><enum>(2)</enum><text>the urbanized area contiguous and adjacent to such a city or town.</text> </paragraph></subsection><after-quoted-block>.</after-quoted-block></quoted-block> </section> <section id="HC9FED5B146D14391003B6FA9DCBB93D8"><enum>205.</enum><header>Businesses in low-income areas</header><text display-inline="no-display-inline">Section 501(d)(3) of the Small Business Investment Act of 1958 (<external-xref legal-doc="usc" parsable-cite="usc/15/695">15 U.S.C. 695(d)(3)</external-xref>) is amended by inserting after <quote>business district revitalization</quote> the following: <quote>or expansion of businesses in low-income communities that would be eligible for new market tax credit investments under <external-xref legal-doc="usc" parsable-cite="usc/26/45D">section 45D</external-xref> of the Internal Revenue Code of 1986 (<external-xref legal-doc="usc" parsable-cite="usc/26/45D">26 U.S.C. 45D</external-xref>)</quote>.</text> </section> <section id="HB4AAA2528EA6478CB609767FE9B573FF"><enum>206.</enum><header>Combinations of certain goals</header><text display-inline="no-display-inline">Section 501(e) of the Small Business Investment Act of 1958 (<external-xref legal-doc="usc" parsable-cite="usc/15/695">15 U.S.C. 695(e)</external-xref>) is amended by adding at the end the following:</text> <quoted-block display-inline="no-display-inline" id="H750345B604BD4CCFB1E8D5D34D43035E" style="OLC"> <paragraph id="HED953600E1114C2488A7BFC2EA8630CE"><enum>(7)</enum><text display-inline="yes-display-inline">A small business concern that is unconditionally owned by more than one individual, or a corporation whose stock is owned by more than one individual, is deemed to achieve a public policy goal under subsection (d)(3) if a combined ownership share of at least 51 percent is held by individuals who are in one of the groups listed as public policy goals specified in subsection (d)(3)(C) or (d)(3)(E).</text> </paragraph><after-quoted-block>.</after-quoted-block></quoted-block> </section> <section id="H91F7B2AF55A64C3095A9E8008701F498"><enum>207.</enum><header>Refinancing</header><text display-inline="no-display-inline">Section 502 of the Small Business Investment Act of 1958 (<external-xref legal-doc="usc" parsable-cite="usc/15/696">15 U.S.C. 696</external-xref>) is amended by adding at the end the following:</text> <quoted-block display-inline="no-display-inline" id="HD5564C0B065E4EBC9C51614416629B20" style="OLC"> <paragraph id="H8D9313CA6A4D44468B85E6AEA8CE5DBC"><enum>(7)</enum><header>Permissible debt refinancing</header><text display-inline="yes-display-inline">Any financing approved under this title may also include a limited amount of debt refinancing for debt that was not previously guaranteed by the Administration. If the project involves expansion of a small business which has existing indebtedness collateralized by fixed assets, any amount of existing indebtedness that does not exceed one-half of the project cost of the expansion may be refinanced and added to the expansion cost, providing—</text> <subparagraph id="H8B9D74D3EA7A403E86DF9E03862321D8"><enum>(A)</enum><text>the proceeds of the indebtedness were used to acquire land, including a building situated thereon, to construct a building thereon or to purchase equipment;</text> </subparagraph> <subparagraph id="H656618BD1D344A92000172967EA22C82"><enum>(B)</enum><text>the borrower has been current on all payments due on the existing debt for at least the past year; and</text> </subparagraph> <subparagraph id="H2D5E75B0BF644E298CDF702EB25E23CA"><enum>(C)</enum><text display-inline="yes-display-inline">the financing under the Certified Development Company Economic Development Loan Program will provide better terms or rate of interest than now exists on the debt.</text> </subparagraph></paragraph><after-quoted-block>.</after-quoted-block></quoted-block> </section> <section id="H0BC74A71C8EB48B5870069A88989BC"><enum>208.</enum><header>Additional equity injections</header><text display-inline="no-display-inline">Clause (ii) of section 502(3)(B) of the Small Business Investment Act of 1958 (<external-xref legal-doc="usc" parsable-cite="usc/15/696">15 U.S.C. 696(3)(B)</external-xref>) is amended to read as follows:</text> <quoted-block display-inline="no-display-inline" id="H13299B13685E489B8B4328F906829700" style="OLC"> <clause id="HFA2ACEE3E0F94CE883473EF17E3BEF4"><enum>(ii)</enum><header>Funding from institutions</header> <subclause id="HB3494221ABF04F4CBFD38FC938E24E3B"><enum>(I)</enum><text display-inline="yes-display-inline">If a small business concern provides the minimum contribution required under paragraph (C), not less than 50 percent of the total cost of any project financed pursuant to clauses (i), (ii), or (iii) of subparagraph (C) shall come from the institutions described in subclauses (I), (II), and (III) of clause (i).</text> </subclause> <subclause id="H465D9C87FCDB41238F8339D2B9E96D1C"><enum>(II)</enum><text>If a small business concern provides more than the minimum contribution required under paragraph (C), any excess contribution may be used to reduce the amount required from the institutions described in subclauses (I), (II), and (III) of clause (i) except that the amount from such institutions may not be reduced to an amount less than the amount of the loan made by the Administration.</text> </subclause></clause><after-quoted-block>.</after-quoted-block></quoted-block> </section> <section id="H7D1F3326FAF24E7C00987B44EA4D00F"><enum>209.</enum><header>Loan liquidations</header><text display-inline="no-display-inline">Section 510 of the Small Business Investment Act of 1958 (<external-xref legal-doc="usc" parsable-cite="usc/15/697g">15 U.S.C. 697g</external-xref>) is amended—</text> <paragraph id="H022994F46AE443F39B42F6FD555BEEB9"><enum>(1)</enum><text>by redesignating subsection (e) as subsection (g); and</text> </paragraph> <paragraph id="H14652B680FBB41ECB2D0E5D8FE4C175E"><enum>(2)</enum><text>by inserting after subsection (d) the following:</text> <quoted-block display-inline="no-display-inline" id="H58C1020F5EE84B2D9CC9F52CF6E1AB2D" style="OLC"> <subsection id="H9E2EAE84AD6149C6873E15961253E2F3"><enum>(e)</enum><header>Participation</header> <paragraph id="H288F356DFE6D4873B54C616748FA4912"><enum>(1)</enum><header>Mandatory</header><text display-inline="yes-display-inline">Any certified development company which elects not to apply for authority to foreclose and liquidate defaulted loans under this section or which the Administration determines to be ineligible for such authority shall contract with a qualified third-party to perform foreclosure and liquidation of defaulted loans in its portfolio. The contract shall be contingent upon approval by the Administration with respect to the qualifications of the contractor and the terms and conditions of liquidation activities.</text> </paragraph> <paragraph id="HB2C5E4EAACDF4F459964A2864236A5C7"><enum>(2)</enum><header>Commencement</header><text>The provisions of this subsection shall not require any development company to liquidate defaulted loans until the Administration has adopted and implemented a program to compensate and reimburse development companies as provided under subsection (f).</text> </paragraph></subsection> <subsection id="H96643CD1D54D4A6BA0E8225FDA96BF08"><enum>(f)</enum><header>Compensation and reimbursement</header> <paragraph id="HF7AB625DD6B144BEA7C079D0C17B33BB"><enum>(1)</enum><header>Reimbursement of expenses</header><text>The Administration shall reimburse each certified development company for all expenses paid by such company as part of the foreclosure and liquidation activities if the expenses—</text> <subparagraph id="HC87495EA48EC42FFAB1964BA144433C"><enum>(A)</enum><text>were approved in advance by the Administration either specifically or generally; or</text> </subparagraph> <subparagraph id="HCD44007E8DA44D9C904FFCAB3DDEB9BC"><enum>(B)</enum><text>were incurred by the company on an emergency basis without Administration prior approval but which were reasonable and appropriate.</text> </subparagraph></paragraph> <paragraph id="H70B198336F1E47318E625E80AC25FD00"><enum>(2)</enum><header>Compensation for results</header><text>The Administration shall develop a schedule to compensate and provide an incentive to qualified State or local development companies which foreclose and liquidate defaulted loans. The schedule shall be based on a percentage of the net amount recovered but shall not exceed a maximum amount. The schedule shall not apply to any foreclosure which is conducted pursuant to a contract between a development company and a qualified third-party to perform the foreclosure and liquidation.</text> </paragraph></subsection><after-quoted-block>.</after-quoted-block></quoted-block> </paragraph></section> <section id="HA269B8FA4F434145998B13EC78E70270"><enum>210.</enum><header>Closing costs</header><text display-inline="no-display-inline">Paragraph (4) of section 503(b) of the Small Business Investment Act of 1958 (<external-xref legal-doc="usc" parsable-cite="usc/15/697">15 U.S.C. 697(b)</external-xref>) is amended to read as follows:</text> <quoted-block display-inline="no-display-inline" id="H8A4873F5AE714A80A04FDE8F272FD454" style="OLC"> <paragraph id="H49327A8E28584D808B3DF2FF7E8E5937"><enum>(4)</enum><text display-inline="yes-display-inline">the aggregate amount of such debenture does not exceed the amount of loans to be made from the proceeds of such debenture plus, at the election of the borrower under the Certified Development Company Economic Development Loan Program, other amounts attributable to the administrative and closing costs of such loans, except for the borrower’s attorney fees;</text> </paragraph><after-quoted-block>.</after-quoted-block></quoted-block> </section> <section id="H3178C37A4F064F2C84B4C9A3DB549CC1"><enum>211.</enum><header>Maximum Certified Development Company and 7(a) loan eligibility</header><text display-inline="no-display-inline">Section 502(2) of the Small Business Investment Act of 1958 (<external-xref legal-doc="usc" parsable-cite="usc/15/696">15 U.S.C. 696(2)</external-xref>) is amended by adding at the end the following:</text> <quoted-block display-inline="no-display-inline" id="H58AAAB198E404C749576504218A1E63B" style="OLC"> <subparagraph id="H4DF5E3D466004CC9B31801355C3C4C22"><enum>(C)</enum><header>Combination financing</header><text display-inline="yes-display-inline">Financing under this title may be provided to a borrower in the maximum amount provided in this subsection, plus a loan guarantee under section 7(a) of the Small Business Act may also be provided to the same borrower in the maximum provided in section 7(a)(3)(A) of such Act.</text> </subparagraph><after-quoted-block>.</after-quoted-block></quoted-block> </section> <section commented="no" id="H0D8CE136388E41238E58C476EC1FD100"><enum>212.</enum><header>Eligibility for energy efficiency projects</header><text display-inline="no-display-inline">Section 501(d)(3) of the Small Business Investment Act of 1958 (<external-xref legal-doc="usc" parsable-cite="usc/15/695">15 U.S.C. 695(d)(3)</external-xref>) is amended—</text> <paragraph id="H8D8F910039F647AFACF05F42C4AF038"><enum>(1)</enum><text>in subparagraph (G) by striking <quote>or</quote> at the end;</text> </paragraph> <paragraph id="H3750DE4FA6894BAC8239335EAEDB21DB"><enum>(2)</enum><text>in subparagraph (H) by striking the period at the end and inserting a comma; and</text> </paragraph> <paragraph id="HBA9FE0B3E5594E61B3DBF1B958CE427B"><enum>(3)</enum><text>by inserting after subparagraph (H) the following:</text> <quoted-block display-inline="no-display-inline" id="HC7BE5A2F43154E9B974D9266074C9C47" style="OLC"> <subparagraph id="H9DC2EF0037BE42838326BB696302145F"><enum>(I)</enum><text>reduction of energy consumption by at least 10 percent, or</text> </subparagraph> <subparagraph id="H0D0B340EB35542DAA19DB5B38CDFBD5"><enum>(J)</enum><text>increased use of sustainable design or low-impact design to produce buildings that reduce the use of non-renewable resources, minimize environmental impact, and relate people with the natural environment.</text> </subparagraph><after-quoted-block>.</after-quoted-block></quoted-block> </paragraph></section> <section commented="no" id="H472A68FE427743BBAA9B38AB6F079603"><enum>213.</enum><header>Loans for plant projects used for energy-efficient purposes</header><text display-inline="no-display-inline">Section 502(2)(A) of the Small Business Investment Act of 1958 (<external-xref legal-doc="usc" parsable-cite="usc/15/696">15 U.S.C. 696(2)(A)</external-xref>) is amended—</text> <paragraph id="H17BF3AC30E2344D682D8BF29CD60ED00"><enum>(1)</enum><text>in clause (ii) by striking <quote>and</quote> at the end;</text> </paragraph> <paragraph id="H07508C814B83407FA586DEE014889DC3"><enum>(2)</enum><text>in clause (iii) by striking the period at the end and inserting <quote>; and</quote>; and</text> </paragraph> <paragraph id="H5E9F2AF4D3BB4D7A88E5EF9E106781B9"><enum>(3)</enum><text>by adding at the end the following:</text> <quoted-block display-inline="no-display-inline" id="H8E6C590EB9154EA78BA52D1801001905" style="OLC"> <clause id="H68C757F27B0741860089A83FF697C04"><enum>(iv)</enum><text>$4,000,000 for each project that reduces the borrower’s energy consumption by at least 10 percent.</text> </clause><after-quoted-block>.</after-quoted-block></quoted-block> </paragraph></section> <section commented="no" id="HAB803A096D7142C1BE342F631803FA95"><enum>214.</enum><header>Extension of period during which loss reserves of premier certified lenders determined on the basis of outstanding balance of debentures</header><text display-inline="no-display-inline">Section 508(c)(6)(B) of the Small Business Investment Act of 1958 (<external-xref legal-doc="usc" parsable-cite="usc/15/697e">15 U.S.C. 697e(c)(6)(B)</external-xref>) is amended by striking <quote>during the 2-year period beginning on the date that is 90 days after the date of the enactment of this subparagraph,</quote> and inserting <quote>through the end of fiscal year 2008,</quote>.</text> </section> <section commented="no" id="HDE5DE4C9E5CD4152AC1739A87818B21"><enum>215.</enum><header>Extension of alternative loss reserve pilot program for certain premier certified lenders</header><text display-inline="no-display-inline">Section 508(c)(7)(J) of the Small Business Investment Act of 1958 (<external-xref legal-doc="usc" parsable-cite="usc/15/697e">15 U.S.C. 697e(c)(7)(J)</external-xref>) is amended by striking <quote>means</quote> and all that follows through the period at the end and inserting <quote>means each calendar quarter through the end of fiscal year 2008.</quote>.</text> </section>

Passed the House of Representatives April 25, 2007.

Lorraine C. Miller, Clerk.

May 1, 2007

Read the second time and placed on the calendar