1.Short title; table of
contents
(a)This title may be cited
as the Small Business Jobs and Credit Act of 2010
.
(b)The table of contents for this Act is as follows:
Sec. 1. Short title; table of contents.
Title I—Small Business Lending Fund
Sec. 101. Purpose.
Sec. 102. Definitions.
Sec. 103. Small Business Lending Fund.
Sec. 104. Additional authorities of the Secretary.
Sec. 105. Considerations.
Sec. 106. Reports.
Sec. 107. Oversight and audits.
Sec. 108. Credit reform; Funding.
Sec. 109. Termination and continuation of
authorities.
Sec. 110. Preservation of authority.
Sec. 111. Assurances.
Sec. 112. Study and report with respect to women-owned,
veteran-owned, and minority-owned businesses.
Sec. 113. Temporary amortization authority.
Sec. 114. Sense of Congress.
Title II—State Small Business Credit Initiative
Sec. 201. Short title.
Sec. 202. Definitions.
Sec. 203. Federal funds allocated to States.
Sec. 204. Approving States for participation.
Sec. 205. Approving State capital access programs.
Sec. 206. Approving collateral support and other innovative
credit access and guarantee initiatives for small businesses and
manufacturers.
Sec. 207. Reports.
Sec. 208. Remedies for State program termination or
failures.
Sec. 209. Implementation and administration.
Sec. 210. Regulations.
Sec. 211. Oversight and audits.
Title III—Small business early-stage investment
program
Sec. 301. Short title.
Sec. 302. Small business early-stage investment
program.
Sec. 303. Regulations.
Sec. 304. Prohibitions on earmarks.
Title IV—Miscellaneous
Sec. 401. Budgetary effects.
Title V—Tax provisions
Sec. 500. Short title; etc.
Subtitle A—Small business tax incentives
Part 1—General provisions
Sec. 501. Temporary exclusion of 100 percent of gain on certain
small business stock.
Part 2—Limitations and reporting on certain penalties
Sec. 511. Limitation on penalty for failure to disclose certain
information.
Sec. 512. Annual reports on penalties and certain other
enforcement actions.
Part 3—Other provisions
Sec. 521. Increase in amount allowed as deduction for start-up
expenditures.
Sec. 522. Nonrecourse small business investment company loans
from the Small Business Administration treated as amounts at risk.
Sec. 523. Benefits under the Small Business Borrower Assistance
Program excluded from gross income.
Subtitle B—Revenue provisions
Sec. 531. Required minimum 10-year term, etc., for grantor
retained annuity trusts.
Sec. 532. Crude tall oil ineligible for cellulosic biofuel
producer credit.
Sec. 533. Time for payment of corporate estimated
taxes.
Title VI—Plain Writing Act
Sec. 601. Short title.
Sec. 602. Purpose.
Sec. 603. Definitions.
Sec. 604. Responsibilities of Federal agencies.
Sec. 605. Reports to Congress.
Title VII—Sense of Congress on agriculture and farming small
business loans
Sec. 701. Sense of Congress.
Title VIII—Small Business Borrower Assistance Program
Sec. 801. Short title.
Sec. 802. Small Business Borrower Assistance
Program.
<enum>I</enum><header>Small
Business Lending Fund</header>
<section id="HED85DB753036491BAF7D1CA9215A5102"><enum>101.</enum><header>Purpose</header><text display-inline="no-display-inline">The purpose of this title is to address the
ongoing effects of the financial crisis on small businesses by providing
temporary authority to the Secretary of the Treasury to make capital
investments in eligible institutions in order to increase the availability of
credit for small businesses.</text>
</section><section id="H63EF820F524C4546AF1367375F437591"><enum>102.</enum><header>Definitions</header><text display-inline="no-display-inline">For purposes of this title:</text>
<paragraph id="H959EBCBCD5C44923917EF6C89387E696"><enum>(1)</enum><header>Appropriate
committees of Congress</header><text>The term <quote>appropriate committees of
Congress</quote> means—</text>
<subparagraph id="H347127F080BC43369F18070F1ED58EDD"><enum>(A)</enum><text>the Committee on
Small Business and Entrepreneurship, the Committee on Agriculture, Nutrition,
and Forestry, the Committee on Banking, Housing, and Urban Affairs, the
Committee on Finance, the Committee on the Budget, and the Committee on
Appropriations of the Senate; and</text>
</subparagraph><subparagraph id="H2BEBA816636D4426A954854C8473A392"><enum>(B)</enum><text>the Committee on
Small Business, the Committee on Agriculture, the Committee on Financial
Services, the Committee on Ways and Means, the Committee on the Budget, and the
Committee on Appropriations of the House of Representatives.</text>
</subparagraph></paragraph><paragraph id="H8160822F7E244C07918C46878EC50ED1"><enum>(2)</enum><header>Appropriate
Federal banking agency</header><text>The term <quote>appropriate Federal
banking agency</quote> has the meaning given such term under section 3(q) of
the Federal Deposit Insurance Act (<external-xref legal-doc="usc" parsable-cite="usc/12/1813">12 U.S.C.
1813(q)</external-xref>).</text>
</paragraph><paragraph id="HEAC43581D9314296AD968EAB93D72930"><enum>(3)</enum><header>Bank holding
company</header><text>The term <quote>bank holding company</quote> has the
meaning given such term under section 2(a)(1) of the Bank Holding Company Act
of 1956 (12 U.S.C. 1841(2)(a)(1)).</text>
</paragraph><paragraph id="HEC06544219444B489BF1E4E783835802"><enum>(4)</enum><header>Call
report</header><text>The term <quote>call report</quote> means—</text>
<subparagraph id="H4C9EFC7AB033490EBC4AC931B25BA959"><enum>(A)</enum><text>reports of
Condition and Income submitted to the Office of the Comptroller of the
Currency, the Board of Governors of the Federal Reserve System, and the Federal
Deposit Insurance Corporation;</text>
</subparagraph><subparagraph id="HA97706D3A7404DB7A3EB5456C0228639"><enum>(B)</enum><text>the Office of
Thrift Supervision Thrift Financial Report;</text>
</subparagraph><subparagraph id="H6F8808A95F5B42129811E56D4A72F2A6"><enum>(C)</enum><text>any report that is
designated by the Office of the Comptroller of the Currency, the Board of
Governors of the Federal Reserve System, the Federal Deposit Insurance
Corporation, or the Office of Thrift Supervision, as applicable, as a successor
to any report referred to in subparagraph (A) or (B);</text>
</subparagraph><subparagraph id="H2995583C063A4CC0974811727F370C0E"><enum>(D)</enum><text display-inline="yes-display-inline">standard reports of Condition and Income
submitted by Community Development Financial Institution loan funds to the
Community Development Financial Institutions Fund; and</text>
</subparagraph><subparagraph id="HD301ABED19DE4280B3E78F14B883D904"><enum>(E)</enum><text display-inline="yes-display-inline">with respect to an eligible institution for
which no report exists that is described under subparagraph (A), (B), or (C),
such other report or set of information as the Secretary, in consultation with
the Administrator of the Small Business Administration, may prescribe.</text>
</subparagraph></paragraph><paragraph id="H888F2FBD628B4A5C9410AC2C5876698B"><enum>(5)</enum><header>CDCI</header><text>The
term <quote>CDCI</quote> means the Community Development Capital Initiative
created by the Secretary under the Troubled Asset Relief Program established by
the Emergency Economic Stabilization Act of 2008.</text>
</paragraph><paragraph id="HA739E0450401473B994D67A4F4D553D9"><enum>(6)</enum><header>CDCI
investment</header><text>The term <quote>CDCI investment</quote> means, with
respect to any eligible institution, the principal amount of any investment
made by the Secretary in such eligible institution under the CDCI that has not
been repaid.</text>
</paragraph><paragraph id="H802CD9FBF7F644CFAA17A4A3AB16BD68"><enum>(7)</enum><header>CPP</header><text>The
term <quote>CPP</quote> means the Capital Purchase Program created by the
Secretary under the Troubled Asset Relief Program established by the Emergency
Economic Stabilization Act of 2008.</text>
</paragraph><paragraph id="H9DDAAA472A0E47F8AEEF801047E9FCFF"><enum>(8)</enum><header>CPP
investment</header><text>The term <quote>CPP investment</quote> means, with
respect to any eligible institution, the principal amount of any investment
made by the Secretary in such eligible institution under the CPP that has not
been repaid.</text>
</paragraph><paragraph id="H2117BA8664FE4A7AB6661B35B50891E1"><enum>(9)</enum><header>Eligible
institution</header><text>The term <quote>eligible institution</quote>
means—</text>
<subparagraph id="H14BC84639A994FB9B9DD93BB26BD2342"><enum>(A)</enum><text>any insured
depository institution, which—</text>
<clause id="HA43E135D24DF4FB2B317E26DD23C8E71"><enum>(i)</enum><text>is
not controlled by a bank holding company or savings and loan holding company
that is also an eligible institution;</text>
</clause><clause id="H9D59B0F0E35646B7955620CCABD4601F"><enum>(ii)</enum><text>has
total assets of equal to or less than $10,000,000,000, as reported in the call
report as of the end of the fourth quarter of calendar year 2009; and</text>
</clause><clause id="H176C015B6F134AC6A48063FA6F589B33"><enum>(iii)</enum><text>is
not directly or indirectly controlled by any company or other entity that has
total consolidated assets of more than $10,000,000,000, as so reported;</text>
</clause></subparagraph><subparagraph id="HFD74A831B33849258E970BA4EFE65060"><enum>(B)</enum><text display-inline="yes-display-inline">any bank holding company which has total
consolidated assets of equal to or less than $10,000,000,000;</text>
</subparagraph><subparagraph id="H271E49F87D3B402DA1B59C27AEB64FB3"><enum>(C)</enum><text display-inline="yes-display-inline">any savings and loan holding company which
has total consolidated assets of equal to or less than $10,000,000,000;</text>
</subparagraph><subparagraph id="H64DA1AD3796141B5939EDC54B08C7BF0"><enum>(D)</enum><text display-inline="yes-display-inline">any community development financial
institution loan fund which has total assets of equal to or less than
$10,000,000,000; and</text>
</subparagraph><subparagraph id="HA18DDD40AB304C3C864E70A3B4458D8E"><enum>(E)</enum><text display-inline="yes-display-inline">any small business lending company that has
total assets of equal to or less than $10,000,000,000.</text>
</subparagraph></paragraph><paragraph id="H621D8A553D4A450DBC925520F8719A9E"><enum>(10)</enum><header>Fund</header><text>The
term <quote>Fund</quote> means the Small Business Lending Fund established by
section 4(a)(1) of this title.</text>
</paragraph><paragraph id="H23D98F032E554BFAB232119BD6D5F6C1"><enum>(11)</enum><header>Insured
depository institution</header><text>The term <quote>insured depository
institution</quote> has the meaning given such term under section 3(c)(2) of
the Federal Deposit Insurance Act (<external-xref legal-doc="usc" parsable-cite="usc/12/1813">12 U.S.C.
1813(c)(2)</external-xref>).</text>
</paragraph><paragraph id="H4DADEE1DC5C34295A5A0803CF0EDB1DF"><enum>(12)</enum><header>Program</header><text>The
term <quote>Program</quote> means the Small Business Lending Fund Program
authorized by section 4(a)(2) of this title.</text>
</paragraph><paragraph id="H91BD07770AB2437EBE9BA8CF1AC0627F"><enum>(13)</enum><header>Savings and
loan holding company</header><text>The term <quote>savings and loan holding
company</quote> has the meaning given such term under section 10(a)(1)(D) of
the Home Owners’ Loan Act (<external-xref legal-doc="usc" parsable-cite="usc/12/1467a">12 U.S.C. 1467a(a)(1)(D)</external-xref>).</text>
</paragraph><paragraph id="HF6BAFE26DFE844528E2D497418A3B9BF"><enum>(14)</enum><header>Secretary</header><text>The
term <quote>Secretary</quote> means the Secretary of the Treasury.</text>
</paragraph><paragraph id="H530C622CCE914B3EA7DE453BBAA5D4E9"><enum>(15)</enum><header>Small business
lending</header>
<subparagraph id="H0D7ACA73282C4884B868180DD86BFA3A"><enum>(A)</enum><header>In
general</header><text display-inline="yes-display-inline">The term <quote>small
business lending</quote> means small business lending, as defined by and
reported in an eligible institution’s quarterly call report, where each loan
comprising such lending is made to a small business and is one of the following
types:</text>
<clause id="H3EB6ECD31906429ABA9EF17025222353"><enum>(i)</enum><text>Commercial and
industrial loans.</text>
</clause><clause id="H9AABE36E7DE14F8198005D8BE8F2FFE5"><enum>(ii)</enum><text>Owner-occupied
nonfarm, nonresidential real estate loans.</text>
</clause><clause id="H059D62C7CE144D31B4C5409A47834660"><enum>(iii)</enum><text>Loans to finance
agricultural production and other loans to farmers.</text>
</clause><clause id="HD5B22E1D4B0C4D9288CC284074FA14A8"><enum>(iv)</enum><text>Loans secured by
farmland.</text>
</clause><clause id="H859B34A5A1B74DE4BF56E794C8328F5E"><enum>(v)</enum><text display-inline="yes-display-inline">Nonowner-occupied commercial real estate
loans.</text>
</clause><clause id="HE15920C1ADE84108842FA0D081DBF607"><enum>(vi)</enum><header>Construction,
land development, and other land loans</header>
<subclause id="HADCC422637BD49549E3006A2BEEF98D6"><enum>(I)</enum><header>In
general</header><text>Loans secured by real estate—</text>
<item id="HFEF31C3153E24DD9BAC141BAF42F4652"><enum>(aa)</enum><text>that
are made to finance—</text>
<subitem id="H5F61B57E4C30439CA279DA4CB1239D77"><enum>(AA)</enum><text display-inline="yes-display-inline">land development that is preparatory to
erecting new structures, including improving land, laying sewers, and laying
water pipes; or</text>
</subitem><subitem id="HF78EB7B915644A148D6DF2632CA6D23A"><enum>(BB)</enum><text display-inline="yes-display-inline">the on-site construction of industrial,
commercial, residential, or farm buildings;</text>
</subitem></item><item id="H3D56A7B3BB204FE38CDD2BF471135DF4"><enum>(bb)</enum><text display-inline="yes-display-inline">that is vacant land, except land known to
be used or usable for agricultural purposes, such as crop and livestock
production;</text>
</item><item id="H941279A681E747E7BA5A1DEE95176C65"><enum>(cc)</enum><text display-inline="yes-display-inline">the proceeds of which are to be used to
acquire and improve developed or undeveloped property; or</text>
</item><item id="H4A313D04CEE14785AB0758A5AA3EE20F"><enum>(dd)</enum><text display-inline="yes-display-inline">that are made under title I or title X of
the National Housing Act.</text>
</item></subclause><subclause display-inline="no-display-inline" id="HFD1FC8F7FFBC4E29BADA33F02CB40CEE"><enum>(II)</enum><header>Construction
industry requirement</header><text display-inline="yes-display-inline">Subclause (I) shall only apply to loans
that are extended to small business concerns in the construction industry, as
such term is defined by the Secretary in consultation with the Administrator of
the Small Business Administration.</text>
</subclause><subclause id="HCF5AA00A6E16449E85B35902C805E8BE"><enum>(III)</enum><header>Construction
defined</header><text display-inline="yes-display-inline">For purposes of this
clause, the term <quote>construction</quote> includes the construction of new
structures, additions or alterations to existing structures, and the demolition
of existing structures to make way for new structures.</text>
</subclause></clause></subparagraph><subparagraph id="HE4E0F378F8274185A99CEDA281C90BED"><enum>(B)</enum><header>Treatment of
holding companies</header><text>In the case of eligible institutions that are
bank holding companies or savings and loan holding companies having one or more
insured depository institution subsidiaries, small business lending shall be
measured based on the combined small business lending reported in the call
report of the insured depository institution subsidiaries.</text>
</subparagraph></paragraph><paragraph id="H5DC7158EAC334DE4BA20FC4299AFD6D0"><enum>(16)</enum><header>Minority-owned
and women-owned business</header><text display-inline="yes-display-inline">The
terms <quote>minority-owned business</quote> and <quote>women-owned
business</quote> shall have the meaning given the terms <quote>minority-owned
business</quote> and <quote>women’s business</quote>, respectively, under
section 21A(r)(4) of the Federal Home Loan Bank Act (<external-xref legal-doc="usc" parsable-cite="usc/12/1441A">12 U.S.C.
1441A(r)(4)</external-xref>).</text>
</paragraph><paragraph id="HA8C0186B16494589972EC8629D0490BC"><enum>(17)</enum><header>CDFI; Community
development financial institution</header><text display-inline="yes-display-inline">The terms <quote>CDFI</quote> and
<quote>community development financial institution</quote> have the meaning
given the term <quote>community development financial institution</quote> under
the Riegle Community Development and Regulatory Improvement Act of 1994.</text>
</paragraph><paragraph id="HFBB559E7FFCC448396260760B214CB9F"><enum>(18)</enum><header>CDLF; Community
development loan fund</header><text display-inline="yes-display-inline">The
terms <quote>CDLF</quote> and <quote>community development loan fund</quote>
mean any entity that—</text>
<subparagraph id="HB2E0DCC4B8DD4B60AEFDA4BE512BADB3"><enum>(A)</enum><text>is certified by
the Department of the Treasury as a community development financial institution
loan fund;</text>
</subparagraph><subparagraph id="H0BF0C9C63B794D3198EE2DDB6E9F9510"><enum>(B)</enum><text>is exempt from
taxation under the Internal Revenue Code of 1986; and</text>
</subparagraph><subparagraph id="H1E4764D72E784CA1883772049F7A8B62"><enum>(C)</enum><text>has assets under
$10,000,000,000 as of the fourth quarter of calendar year 2009.</text>
</subparagraph></paragraph><paragraph display-inline="no-display-inline" id="H2FDB797A9B4F42CE880AF3AF0EB7BD5C"><enum>(19)</enum><header>Small
business</header><text display-inline="yes-display-inline">The term
<quote>small business</quote> has the meaning given the term <quote>small
business concern</quote> under section 3 of the Small Business Act
(<external-xref legal-doc="usc" parsable-cite="usc/15/632">15 U.S.C.
632</external-xref>).</text>
</paragraph><paragraph id="H9AE3FC2E385D40D68424B359E105EFF9"><enum>(20)</enum><header>Small business
lending company</header><text>The term <quote>small business lending
company</quote> has the meaning given such term under section 3(r)(1) of the
Small Business Act (<external-xref legal-doc="usc" parsable-cite="usc/15/632">15 U.S.C. 632(r)(1)</external-xref>).</text>
</paragraph><paragraph id="H0B7F4D06D1C24DACA8801809C9F0F29B"><enum>(21)</enum><header>Veteran-owned
business</header>
<subparagraph id="H244162A180EE4595AB83A175F5C6FC1E"><enum>(A)</enum><text>The term
<quote>veteran-owned business</quote> means a business—</text>
<clause id="H55A960E81895478191F91B81D8A4F679"><enum>(i)</enum><text>more
than 50 percent of the ownership or control of which is held by 1 or more
veterans;</text>
</clause><clause id="H0D9FE29F72C247779B924309436FF5E6"><enum>(ii)</enum><text>more than 50
percent of the net profit or loss of which accrues to 1 or more veterans;
and</text>
</clause><clause id="HE523A8DF5A1C4D46822F20DF7E287639"><enum>(iii)</enum><text>a
significant percentage of senior management positions of which are held by
veterans.</text>
</clause></subparagraph><subparagraph id="H5FE6BEFD6AAB4169A96C3C20820E7CA3"><enum>(B)</enum><text>For purposes of
this paragraph, the term <quote>veteran</quote> has the meaning given such term
in <external-xref legal-doc="usc" parsable-cite="usc/38/101">section
101(2)</external-xref> of title 38, United States Code.</text>
</subparagraph></paragraph></section><section id="HF74F6E2D5D8D49A3B1904C4F9F0099B7"><enum>103.</enum><header>Small Business
Lending Fund</header>
<subsection id="H3874CD2E64FF46E886EC6324368FE5AB"><enum>(a)</enum><header>Fund and
program</header>
<paragraph id="H34452E0817A243F2BC3ED0059EA44C57"><enum>(1)</enum><header>Fund
established</header><text>There is established in the Treasury of the United
States a fund to be known as the <quote>Small Business Lending Fund</quote>,
which shall be administered by the Secretary.</text>
</paragraph><paragraph id="H9186B54173FA4B4B98BBA41F3991AE27"><enum>(2)</enum><header>Programs
authorized</header><text>The Secretary is authorized to establish the Small
Business Lending Fund Program for using the Fund consistent with this
title.</text>
</paragraph></subsection><subsection id="HF7F604ECAA334FB990C780FF201E3784"><enum>(b)</enum><header>Use of
Fund</header>
<paragraph id="H137BD09869B043D7B616AB2DB2F36512"><enum>(1)</enum><header>In
general</header><text display-inline="yes-display-inline">Subject to paragraph
(2), the Fund shall be available to the Secretary, without further
appropriation or fiscal year limitation, for the costs of purchases (including
commitments to purchase), and modifications of such purchases, of preferred
stock and other financial instruments from eligible institutions on such terms
and conditions as are determined by the Secretary in accordance with this
title. For purposes of this paragraph and with respect to an eligible
institution, the term <quote>other financial instruments</quote> shall include
only debt instruments for which such eligible institution is fully liable or
equity equivalent capital of the eligible institution. Such debt instruments
may be subordinated to the claims of other creditors of the eligible
institution.</text>
</paragraph><paragraph id="H4D49159BD90D49FAB6045ED1218193F8"><enum>(2)</enum><header>Maximum purchase
limit</header><text>The aggregate amount of purchases (and commitments to
purchase) made pursuant to paragraph (1) may not exceed $30,000,000,000.</text>
</paragraph><paragraph id="H9E304A131BBB40B18CD70A9E4EB26D38"><enum>(3)</enum><header>Proceeds used to
pay down public debt</header><text display-inline="yes-display-inline">All
funds received by the Secretary in connection with purchases made pursuant to
paragraph (1), including interest payments, dividend payments, and proceeds
from the sale of any financial instrument, shall be paid into the general fund
of the Treasury for reduction of the public debt.</text>
</paragraph><paragraph id="HA60EBC2E29474C19B6982E7D6BE93D01"><enum>(4)</enum><header>Limitation on
purchases from CDLFs</header>
<subparagraph id="H3352B4B1A2424CAD86F96CFD69F6D11F"><enum>(A)</enum><header>In
general</header><text>Not more than 1 percent of the value of purchases made by
the Secretary in carrying out the Program may be used to make purchases from
community development loan funds.</text>
</subparagraph><subparagraph id="HAB33A995651F4E19870A6AF15D397598"><enum>(B)</enum><header>Eligibility
standards</header><text display-inline="yes-display-inline">The Secretary, in
consultation with the Community Development Financial Institutions Fund, shall
develop eligibility criteria to determine the financial ability of a CDLF to
participate in the Program and repay the investment. Such criteria may include
net asset ratio to total assets, ratio of loan loss reserves to loans and
leases 90 days or more delinquent (including loans sold with full recourse),
positive net income measured on a 3-year rolling average, operating liquidity
ratio, ratio of loans and leases 90 days or more delinquent (including loans
sold with full recourse) to total equity plus loan loss reserves or any other
measures deemed appropriate. In addition, CDLFs participating in the Program
shall submit audited financial statements to the Secretary, have a clean audit
opinion, and have at least three years of operating experience.</text>
</subparagraph></paragraph></subsection><subsection id="H10BAE82CA7FE49B0A3068AAE71CFAEE9"><enum>(c)</enum><header>Credits to the
fund</header><text>There shall be credited to the Fund amounts made available
pursuant to section 9, to the extent provided by appropriations Acts.</text>
</subsection><subsection id="H7B725F619B2F43F7A37BBFB94D55D21B"><enum>(d)</enum><header>Terms</header>
<paragraph id="H72C7DA8F4E8F4B1FB82422AC753EA482"><enum>(1)</enum><header>Application</header>
<subparagraph id="HF8A1B682AB5046B2B91B1AA2CFD78567"><enum>(A)</enum><header>Institutions
with assets of $1,000,000,000 or less</header><text>Eligible institutions
having total assets equal to or less than $1,000,000,000, as reported in a call
report as of the end of the fourth quarter of calendar year 2009, may apply to
receive a capital investment from the Fund in an amount not exceeding 5 percent
of risk-weighted assets, as reported in the call report immediately preceding
the date of application, less the amount of any CDCI investment and any CPP
investment.</text>
</subparagraph><subparagraph id="H037267562F4D4B1D93F31F407C4FB8D1"><enum>(B)</enum><header>Institutions
with assets of more than $1,000,000,000 and less than
$10,000,000,000</header><text>Eligible institutions having total assets of more
than $1,000,000,000 but less than $10,000,000,000, as of the end of the fourth
quarter of calendar year 2009, may apply to receive a capital investment from
the Fund in an amount not exceeding 3 percent of risk-weighted assets, as
reported in the call report immediately preceding the date of application, less
the amount of any CDCI investment and any CPP investment.</text>
</subparagraph><subparagraph id="H1945A4631EBE4EF7ACFD388FFBA7BC0F"><enum>(C)</enum><header>Treatment of
holding companies</header><text>In the case of an eligible institution that is
a bank holding company or a savings and loan holding company having one or more
insured depository institution subsidiaries, total assets shall be measured
based on the combined total assets reported in the call report of the insured
depository institution subsidiaries as of the end of the fourth quarter of
calendar year 2009 and risk-weighted assets shall be measured based on the
combined risk-weighted assets of the insured depository institution
subsidiaries as reported in the call report immediately preceding the date of
application.</text>
</subparagraph><subparagraph id="HB0A5D862B4BC44DA84BA25B748DAC437"><enum>(D)</enum><header>Treatment of
applicants that are institutions controlled by holding
companies</header><text>If an eligible institution that applies to receive a
capital investment under the Program is under the control of a bank holding
company or a savings and loan holding company, then the Secretary may use the
Fund to purchase preferred stock or other financial instruments from the
top-tier bank holding company or savings and loan holding company of such
eligible institution, as applicable. For purposes of this paragraph, the term
<quote>control</quote> with respect to a bank holding company shall have the
same meaning as in section 2(a)(2) of the Bank Holding Company Act of 1956 (12
U.S.C. 1841(2)(a)(2)). For purposes of this paragraph, the term
<quote>control</quote> with respect to a savings and loan holding company shall
have the same meaning as in 10(a)(2) of the Home Owners’ Loan Act
(<external-xref legal-doc="usc" parsable-cite="usc/12/1467a">12 U.S.C.
1467a(a)(2)</external-xref>).</text>
</subparagraph><subparagraph id="H5C0C4A37D3A84DE98ADAB79EFE74D645"><enum>(E)</enum><header>Requirement to
provide a small business lending plan</header><text display-inline="yes-display-inline">At the time that an applicant submits an
application to the Secretary for a capital investment under the Program, the
applicant shall deliver to the appropriate Federal banking agency and, for
applicants that are State-chartered banks, to the appropriate State banking
regulator, a small business lending plan describing how the applicant’s
business strategy and operating goals will allow it to address the needs of
small businesses in the areas it serves, as well as a plan to provide
linguistically and culturally appropriate outreach, where appropriate. This
plan shall be confidential supervisory information.</text>
</subparagraph><subparagraph id="HBE474DCBE762475DA4CC3E8FD755DC3A"><enum>(F)</enum><header>Treatment of
applicants that are community development loan funds</header><text display-inline="yes-display-inline">Eligible institutions that are community
development loan funds may apply to receive a capital investment from the Fund
in an amount not exceeding 10 percent of total assets, as reported in the call
report immediately preceding the date of application.</text>
</subparagraph><subparagraph id="H9171E58B042248D8A7D1B0CA3039095A"><enum>(G)</enum><header>Election to
include other nonfarm, nonresidential real estate loans in amount of small
business lending</header><text display-inline="yes-display-inline">At the time
that an applicant submits an application to the Secretary for a capital
investment under the Program, the applicant may notify the Secretary that it
elects to have included in the determination of the amount of its small
business lending, for purposes of the computations made under paragraph (4),
the amount of lending reported as other nonfarm, nonresidential real estate
loans in its quarterly call report, but for purposes of this subparagraph,
other nonfarm, nonresidential real estate loans shall not include a loan having
an original amount greater than $10,000,000. If an applicant makes the election
under this subparagraph, the amount of lending reported as other nonfarm,
nonresidential real estate loans shall be included in the determination of the
amount of its small business lending for purposes of the computations made
under paragraph (4).</text>
</subparagraph></paragraph><paragraph id="H8F1AF2595D324BDA8CB9048CAA391E55"><enum>(2)</enum><header>Consultation
with regulators</header><text>For each eligible institution that applies to
receive a capital investment under the Program, the Secretary shall—</text>
<subparagraph id="HBFF6A8810FFD44E6AE27C03ECA5F263F"><enum>(A)</enum><text display-inline="yes-display-inline">consult with the appropriate Federal
banking agency or, in the case of an eligible institution that is a
non-depository community development financial institution, the Community
Development Financial Institution Fund, for the eligible institution to
determine whether the eligible institution may receive such capital
investment;</text>
</subparagraph><subparagraph id="H961F586CAE1244E98CB08A803A5476E6"><enum>(B)</enum><text display-inline="yes-display-inline">in the case of an eligible institution that
is a State-chartered bank, consider any views received from the State banking
regulator of the State of the eligible institution regarding the financial
condition of the eligible institution; and</text>
</subparagraph><subparagraph id="H24473F6CCEA44FF39D063386C19BC8CB"><enum>(C)</enum><text display-inline="yes-display-inline">in the case of a community development
financial institution loan fund, consult with the Community Development
Financial Institution Fund.</text>
</subparagraph></paragraph><paragraph display-inline="no-display-inline" id="H75FB8873AE0D499CB5791C3C4F7EDC3A"><enum>(3)</enum><header>Ineligibility of
institutions on FDIC problem bank list</header>
<subparagraph id="H48B47A09A62A49CD8514D3000250BC4C"><enum>(A)</enum><header>In
general</header><text>An eligible institution may not receive any capital
investment under the Program if—</text>
<clause id="H14E1A3C48182485280353D0D36B06753"><enum>(i)</enum><text>such
institution is on the FDIC problem bank list; or</text>
</clause><clause id="H8D43A5CBDA1948B59781DF55B36EF099"><enum>(ii)</enum><text>such institution
has been removed from the FDIC problem bank list for less than 90 days.</text>
</clause></subparagraph><subparagraph display-inline="no-display-inline" id="H958A8E9EEE1142128F564C5A7D0CC8D7"><enum>(B)</enum><header>Construction</header><text display-inline="yes-display-inline">Nothing in subparagraph (A) shall be
construed as limiting the discretion of the Secretary to deny the application
of an eligible institution that is not on the FDIC problem bank list.</text>
</subparagraph><subparagraph id="HB5724C3A3F134EB7B889F6A9BDAADF23"><enum>(C)</enum><header>FDIC problem
bank list defined</header><text display-inline="yes-display-inline">For
purposes of this subparagraph, the term <quote>FDIC problem bank list</quote>
means the list of institutions with a current rating of 4 or 5 under the
Uniform Financial Institutions Rating System, or such other list designated by
the Federal Deposit Insurance Corporation.</text>
</subparagraph></paragraph><paragraph id="H3655BB1E16FE4A26B59C7D8A841A939F"><enum>(4)</enum><header>Incentives to
lend</header>
<subparagraph id="HBAC8AB6A9C3C476F87DCEC011DB285F4"><enum>(A)</enum><header>Requirements on
preferred stock and other financial instruments</header><text>Any preferred
stock or other financial instrument issued to Treasury by an eligible
institution receiving a capital investment under the Program shall provide
that—</text>
<clause id="H81B446CB646E4195845E666EA518E3CD"><enum>(i)</enum><text>the
rate at which dividends or interest are payable shall be 5 percent per annum
initially;</text>
</clause><clause id="H6A4619A2661848979E08A12CB1AA6213"><enum>(ii)</enum><text display-inline="yes-display-inline">within the first 2 years after the date of
the capital investment under the Program, the rate may be adjusted based on the
amount of an eligible institution’s small business lending. Changes in the
amount of small business lending shall be measured against the average amount
of small business lending reported by the eligible institution in its call
reports for the 4 full quarters immediately preceding the enactment of this
title, minus adjustments from each quarterly balance in respect of—</text>
<subclause id="HDB346AF91F2144BB8F7FCBF8DB66C658"><enum>(I)</enum><text>net loan charge
offs with respect to small business lending; and</text>
</subclause><subclause id="HC2B17F9C37934E25AC3DFBF08B573454"><enum>(II)</enum><text>gains realized by
the eligible institution resulting from mergers, acquisitions or purchases of
loans after origination and syndication; which adjustments shall be determined
in accordance with guidance promulgated by the Secretary; and</text>
</subclause></clause><clause id="H410EB07D03AF40308C35B800F99FB23D"><enum>(iii)</enum><text>during any
calendar quarter during the initial 2-year period referred to in clause (ii),
an institution’s rate shall be adjusted to reflect the following schedule,
based on that institution’s change in the amount of small business lending
relative to the baseline—</text>
<subclause id="HA0CED3A0C773483C9BBD7B6F924F1DF7"><enum>(I)</enum><text>if the amount of
small business lending has increased by less than 2.5 percent, the dividend or
interest rate shall be 5 percent;</text>
</subclause><subclause id="H84A57E11C07E4865B9743812E9082E96"><enum>(II)</enum><text>if the amount of
small business lending has increased by 2.5 percent or greater, but by less
than 5.0 percent, the dividend or interest rate shall be 4 percent;</text>
</subclause><subclause id="H9DCB341E55964B4AAF9A738EB98C85D4"><enum>(III)</enum><text>if the amount of
small business lending has increased by 5.0 percent or greater, but by less
than 7.5 percent, the dividend or interest rate shall be 3 percent;</text>
</subclause><subclause id="H985D5450533D483FBD335BEBF2AC9B63"><enum>(IV)</enum><text>if the amount of
small business lending has increased by 7.5 percent or greater, and but by less
than 10.0 percent, the dividend or interest rate shall be 2 percent; or</text>
</subclause><subclause id="H364E804D15FA47178517056C621993F0"><enum>(V)</enum><text>if the amount of
small business lending has increased by 10 percent or greater, the dividend or
interest rate shall be 1 percent.</text>
</subclause></clause></subparagraph><subparagraph id="H7D49293F2D0B474E8B23A0A1D6E02E89"><enum>(B)</enum><header>Basis of initial
rate</header><text>The initial dividend or interest rate shall be based on call
report data published in the quarter immediately preceding the date of the
capital investment under the Program.</text>
</subparagraph><subparagraph id="H221334BAC51C4E708390711E9DDEBEDF"><enum>(C)</enum><header>Timing of rate
adjustments</header><text>Any rate adjustment shall occur in the calendar
quarter following the publication of call report data, such that the rate based
on call report data from any one calendar quarter, which is published in the
first following calendar quarter, shall be adjusted in that first following
calendar quarter and payable in the second following quarter.</text>
</subparagraph><subparagraph id="HB72602077D104571835E747188049AA7"><enum>(D)</enum><header>Rate following
initial 2-year period</header><text>Generally, the rate based on call report
data from the eighth calendar quarter after the date of the capital investment
under the Program shall be payable until the expiration of the
4<fraction>½</fraction>-year period that begins on the date of the investment.
In the case where the amount of small business lending has remained the same or
decreased relative to the institution's baseline in the eighth quarter after
the date of the capital investment under the Program, the rate shall be 7
percent until the expiration of the 4<fraction>½</fraction>-year period that
begins on the date of the investment.</text>
</subparagraph><subparagraph id="HEB6D8728FDB04931B43E963D6D64E502"><enum>(E)</enum><header>Rate following
initial 4<fraction>½</fraction>-year period</header><text>The dividend or
interest rate paid on any preferred stock or other financial instrument issued
by an eligible institution that receives a capital investment under the Program
shall increase to 9 percent at the end of the 4<fraction>½</fraction>-year
period that begins on the date of the capital investment under the
Program.</text>
</subparagraph><subparagraph id="H079304F867C5455E88E2B458E1BF3D26"><enum>(F)</enum><header>Limitation on
rate reductions with respect to certain amount</header><text>The reduction in
the dividend or interest rate payable to Treasury by any eligible institution
shall be limited such that the rate reduction shall not apply to a dollar
amount of the investment made by Treasury that is greater than the dollar
amount increase in the amount of small business lending realized under this
program. The Secretary may issue guidelines that will apply to new capital
investments limiting the amount of capital available to eligible institutions
consistent with this limitation.</text>
</subparagraph><subparagraph id="H11366D79E63343559703CC0F9938D1B0"><enum>(G)</enum><header>Rate adjustments
for S corporation</header><text>Before making a capital investment in an
eligible institution that is an S corporation or a corporation organized on a
mutual basis, the Secretary may adjust the dividend or interest rate on the
financial instrument to be issued to the Secretary, from the dividend or
interest rate that would apply under subparagraphs (A) through (F), to take
into account any differential tax treatment of securities issued by such
eligible institution. For purpose of this subparagraph, the term <quote>S
corporation</quote> has the same meaning as in
<external-xref legal-doc="usc" parsable-cite="usc/26/1361">section
1361(a)</external-xref> of the Internal Revenue Code of 1986.</text>
</subparagraph><subparagraph id="H99956049005E4290A5A24773E62C91FA"><enum>(H)</enum><header>Repayment
deadline</header><text>The capital investment received by an eligible
institution under the Program shall be evidenced by preferred stock or other
financial instrument that—</text>
<clause id="HF4C1799788DC48EEB5F3D6047E348D0F"><enum>(i)</enum><text display-inline="yes-display-inline">includes, as a term and condition, that the
capital investment will—</text>
<subclause id="H488EBCCBCCBA42CFBC77B46854505BC5"><enum>(I)</enum><text>be repaid not
later than the end of the 10-year period beginning on the date of the capital
investment under the Program; or</text>
</subclause><subclause id="HAD90B5565A6F4A9993FE925F0CDDB238"><enum>(II)</enum><text>at the end of
such 10-year period, be subject to such additional terms as the Secretary shall
prescribe, which shall include a requirement that the stock or instrument shall
carry the highest dividend or interest rate payable; and</text>
</subclause></clause><clause display-inline="no-display-inline" id="HC48A6049C5C141BDBE2D635AC9F6BE7E"><enum>(ii)</enum><text>provides that the
term and condition described under clause (i) shall not apply if the
application of that term and condition would adversely affect the capital
treatment of the stock or financial instrument under current or successor
applicable capital provisions compared to a capital instrument with identical
terms other than the term and condition described under clause (i).</text>
</clause></subparagraph><subparagraph display-inline="no-display-inline" id="HEA71D4131D45449AA090617FDC8E4243"><enum>(I)</enum><header>Requirements on
financial instruments issued by a community development financial institution
loan fund</header><text display-inline="yes-display-inline">Any equity
equivalent capital issued to the Treasury by a Community Development Financial
Institution loan fund receiving a capital investment under the Program shall
provide that the rate at which interest is payable shall be 2 percent per annum
for 8 years. After 8 years, the rate at which interest is payable shall be 9
percent.</text>
</subparagraph><subparagraph id="H0917C50725084A999FC4AFC027D044FE"><enum>(J)</enum><header>Incentives
contingent on an increase in the number of loans made</header><text display-inline="yes-display-inline">For any quarter during the first
4<fraction>½</fraction>-year period following the date on which an eligible
institution receives a capital investment under the Program, other than the
first such quarter, in which the institution’s change in the amount of small
business lending relative to the baseline is positive, if the number of loans
made by the institution does not increase by 2.5 percent for each 2.5 percent
increase of small business lending, then the rate at which dividends and
interest shall be payable during the following quarter on preferred stock or
other financial instruments issued to the Treasury by the eligible institution
shall be—</text>
<clause display-inline="no-display-inline" id="HF505460F12DF403B876923466DA60DA5"><enum>(i)</enum><text display-inline="yes-display-inline">5 percent, if such quarter is within the
2-year period following the date on which the eligible institution receives the
capital investment under the Program; or</text>
</clause><clause id="H0D575AE0241E42EB95877651AEF5B932"><enum>(ii)</enum><text>7
percent, if such quarter is after such 2-year period.</text>
</clause></subparagraph><subparagraph display-inline="no-display-inline" id="H65A4E8DDB8D141999C3F871909BE0508"><enum>(K)</enum><header>Alternative
computation</header><text>An eligible institution may choose to compute their
small business lending amount by computing the amount of small business
lending, as if the definition of such term did not require that the loans
comprising such lending be made to small business. Any eligible institution
choosing to compute their small business lending in this manner shall certify
that all lending included by the institution for purposes of computing the
increase in lending under this paragraph was made to small businesses.</text>
</subparagraph></paragraph><paragraph id="H7001B44C2F014866AF50545179BD984B"><enum>(5)</enum><header>Additional
incentives to repay</header><text>The Secretary may, by regulation or guidance
issued under section 104(8), establish repayment incentives in addition to the
incentive in paragraph (4)(E) that will apply to new capital investments in a
manner that the Secretary determines to be consistent with the purposes of this
title.</text>
</paragraph><paragraph id="H156BD54E0CA044BA8212C1ADF3BDFE45"><enum>(6)</enum><header>Capital purchase
program refinance</header>
<subparagraph id="HFEC92869B91B453C8FE7A99B4C4D71F6"><enum>(A)</enum><header>In
general</header><text>The Secretary shall, in a manner that the Secretary
determines to be consistent with the purposes of this title, issue regulations
and other guidance to permit eligible institutions to refinance securities
issued to Treasury under the CDCI and the CPP for securities to be issued under
the Program.</text>
</subparagraph><subparagraph id="HCA578A31737C4E09B22B3D55F05FC681"><enum>(B)</enum><header>Prohibition on
participation by non-paying CPP participants</header><text display-inline="yes-display-inline">Subparagraph (A) shall not apply to any
eligible institution that has missed more than one dividend payment due under
the CPP. For purposes of this subparagraph, a CPP dividend payment that is
submitted within 60 days of the due date of such payment shall not be
considered a missed dividend payment.</text>
</subparagraph></paragraph><paragraph display-inline="no-display-inline" id="H2302B8BB93C74C0489614428F1D95007"><enum>(7)</enum><header>Outreach to
minorities, women, and veterans</header><text display-inline="yes-display-inline">The Secretary shall require eligible
institutions receiving capital investments under the Program to provide
linguistically and culturally appropriate outreach and advertising in the
applicant pool describing the availability and application process of receiving
loans from the eligible institution that are made possible by the Program
through the use of print, radio, television or electronic media outlets which
target organizations, trade associations, and individuals that—</text>
<subparagraph id="H3E742B1E5F8F44239A289B90B6504BE9"><enum>(A)</enum><text display-inline="yes-display-inline">represent or work within or are members of
minority communities;</text>
</subparagraph><subparagraph id="HFEBD609F9664466C9DE092D6ECA297D9"><enum>(B)</enum><text>represent or work
with or are women; and</text>
</subparagraph><subparagraph id="H3B86732896B141CCA7221D5B27CE14B2"><enum>(C)</enum><text>represent or work
with or are veterans.</text>
</subparagraph></paragraph><paragraph id="H84DAADC23C104D3F8AAB9F5F3CEC9E10"><enum>(8)</enum><header>Additional
terms</header><text>The Secretary may, by regulation or guidance issued under
section 5(9), make modifications that will apply to new capital investments in
order to manage risks associated with the administration of the Fund in a
manner consistent with the purposes of this title.</text>
</paragraph><paragraph id="H5FA4137B8A78417086B5D56879BE5D00"><enum>(9)</enum><header>Minimum
underwriting standards</header><text display-inline="yes-display-inline">The
appropriate Federal banking agency for an eligible institution that receives
funds under the Program shall within 60 days issue guidance regarding prudent
underwriting standards that must be used for loans made by the eligible
institution using such funds. In the case of a community development financial
institution loan fund, the Community Development Financial Institutions Fund
shall within 60 days issue regulations defining minimum underwriting standards
that must be used for loans made by the eligible institution using such
funds.</text>
</paragraph><paragraph id="HC7A1408C9EA64685B067E57E7E940C33"><enum>(10)</enum><header>Reporting</header><text display-inline="yes-display-inline">Each eligible institution receiving a
capital investment under the Program shall issue a quarterly report to the
Secretary detailing the percentage of new loans to small businesses the
institution makes that are—</text>
<subparagraph id="H49594E49E2124FE78D9C8E3AAD4DEC00"><enum>(A)</enum><text display-inline="yes-display-inline">guaranteed by the Small Business
Administration;</text>
</subparagraph><subparagraph id="HD980B366BA2D411D91638252945F674B"><enum>(B)</enum><text>made to Small
Business Investment Companies;</text>
</subparagraph><subparagraph id="H77018CFFB0F84EBC81D5C59239F87865"><enum>(C)</enum><text>other loans made
to small business concerns (as defined under the Small Business Act), if the
internal reporting of the concern distinguishes the size of businesses to which
loans are made; and</text>
</subparagraph><subparagraph id="HE3F3A0D399DD43699DB5F5A29CDEAEFB"><enum>(D)</enum><text display-inline="yes-display-inline">other loans made to entities that the
internal reporting of the concern classifies as a small business.</text>
</subparagraph></paragraph></subsection><subsection display-inline="no-display-inline" id="H7EBA50FB61E94BD6A3C961E1BED9C462"><enum>(e)</enum><header>Notification to
customers</header><text display-inline="yes-display-inline">Any eligible
institution receiving funds under the Program shall—</text>
<paragraph id="H186E67229B074B9892929EC2ED9C1798"><enum>(1)</enum><text>disclose on every
applicable loan transaction that the loan is being made possible by the
Program; and</text>
</paragraph><paragraph id="H4E5EFDFCAF1A4376B1E5036459C82EAC"><enum>(2)</enum><text>if such
institution has an established internet website, such institution shall make
available on its internet website—</text>
<subparagraph id="H51C9D97DF4D940EDB5728DC88D4B19D8"><enum>(A)</enum><text>the written
reports made by the Secretary pursuant to paragraphs (1) and (2) of section 7;
and</text>
</subparagraph><subparagraph id="H55CF8F27E57D4415BF5B01CB3B3F1F52"><enum>(B)</enum><text>a statement that
the institution, as a participant in the Program, is seeking to make small
business loans to qualified borrowers and may not discriminate on the basis of
any factor prohibited under the Equal Credit Opportunity Act, including the
race, color, religion, national origin, sex, marital status, or age.</text>
</subparagraph></paragraph></subsection></section><section id="H8C956A2375D248FC9A070F2356821381"><enum>104.</enum><header>Additional
authorities of the Secretary</header><text display-inline="no-display-inline">The Secretary may take such actions as the
Secretary deems necessary to carry out the authorities in this title,
including, without limitation, the following:</text>
<paragraph id="H592CC71E7262444E88C50F3EB3174704"><enum>(1)</enum><text>The Secretary may
use the services of any agency or instrumentality of the United States or
component thereof on a reimbursable basis, and any such agency or
instrumentality or component thereof is authorized to provide services as
requested by the Secretary using all authorities vested in or delegated to that
agency, instrumentality, or component.</text>
</paragraph><paragraph id="H0227FFDA6DE047528BCC398CA91F8A85"><enum>(2)</enum><text>The Secretary may
designate any bank, savings association, trust company, security broker or
dealer, asset manager, or investment adviser as a financial agent of the
Federal Government and such institution shall perform all such reasonable
duties related to this title as financial agent of the Federal Government as
may be required. The Secretary shall have authority to amend existing
agreements with financial agents, entered into during the 2-year period before
the date of enactment of this title, to perform reasonable duties related to
this title.</text>
</paragraph><paragraph id="H0FC30321F3AE46B4889D7B6FFD0DC80C"><enum>(3)</enum><text>The Secretary may
exercise any rights received in connection with any preferred stock or other
financial instruments or assets purchased or acquired pursuant to the
authorities granted under this title.</text>
</paragraph><paragraph id="H0949FAEBB0FB45D0B6B3538B9E7558DD"><enum>(4)</enum><text>Subject to section
4(b)(3), the Secretary may manage any assets purchased under this title,
including revenues and portfolio risks therefrom.</text>
</paragraph><paragraph id="HD66861D210584F48959FEE27A28DBED3"><enum>(5)</enum><text>The Secretary may
sell, dispose of, transfer, exchange or enter into securities loans, repurchase
transactions, or other financial transactions in regard to, any preferred stock
or other financial instrument or asset purchased or acquired under this title,
upon terms and conditions and at a price determined by the Secretary.</text>
</paragraph><paragraph id="H09EB9D2ABF3D44AD9CE6670F445D1A4A"><enum>(6)</enum><text>The Secretary may
manage or prohibit conflicts of interest that may arise in connection with the
administration and execution of the authorities provided under this
title.</text>
</paragraph><paragraph id="H71BEB9FDE8BB459F81AD610414A1CF66"><enum>(7)</enum><text>The Secretary may
establish and use vehicles, subject to supervision by the Secretary, to
purchase, hold, and sell preferred stock or other financial instruments and
issue obligations.</text>
</paragraph><paragraph id="HB8A917EF197348FBA8C0B387113B552B"><enum>(8)</enum><text>The Secretary may,
in consultation with the Administrator of the Small Business Administration,
issue such regulations and other guidance as may be necessary or appropriate to
define terms or carry out the authorities or purposes of this title.</text>
</paragraph></section><section id="H089E4DCC545A4AB3867054C301D506A5"><enum>105.</enum><header>Considerations</header><text display-inline="no-display-inline">In exercising the authorities granted in
this title, the Secretary shall take into consideration—</text>
<paragraph id="H9B7F7E5C950C46438A5C9A22AD8737C1"><enum>(1)</enum><text>increasing the
availability of credit for small businesses;</text>
</paragraph><paragraph display-inline="no-display-inline" id="H5CD32E134631429FA5A17DE19AF145B6"><enum>(2)</enum><text display-inline="yes-display-inline">providing funding to minority-owned
eligible institutions and other eligible institutions that serve small
businesses that are minority-, veteran-, and women-owned and that also serve
low- and moderate-income, minority, and other underserved or rural
communities;</text>
</paragraph><paragraph id="H85671DC28FF5450B8C084E1F32409843"><enum>(3)</enum><text>protecting and
increasing American jobs;</text>
</paragraph><paragraph display-inline="no-display-inline" id="HFB603BC26C1A4E08ABF71F4DD0EA8AB2"><enum>(4)</enum><text display-inline="yes-display-inline">increasing the opportunity for small
business development in areas with high unemployment rates that exceed the
national average;</text>
</paragraph><paragraph id="H4820DE84BC3246458FC008D04548C4E4"><enum>(5)</enum><text>ensuring that all
eligible institutions may apply to participate in the program established under
this title, without discrimination based on geography;</text>
</paragraph><paragraph id="HA6F6A88F2A35445C8AC8213D8D6E450F"><enum>(6)</enum><text>providing
transparency with respect to use of funds provided under this title;</text>
</paragraph><paragraph id="H68C298766D9E456891FA4288A6B7375E"><enum>(7)</enum><text>minimizing the
cost to taxpayers of exercising the authorities;</text>
</paragraph><paragraph id="H9EEDE53F0CFC4EBAA12DD36AA06C7F29"><enum>(8)</enum><text>promoting and
engaging in financial education to would-be borrowers; and</text>
</paragraph><paragraph id="H192E974B7C5740EDAD93F5703177632A"><enum>(9)</enum><text display-inline="yes-display-inline">providing funding to eligible institutions
that serve small businesses directly affected by the discharge of oil arising
from the explosion on and sinking of the mobile offshore drilling unit
Deepwater Horizon and small businesses in communities that have suffered
negative economic effects as a result of that discharge with particular
consideration to States along the coast of the Gulf of Mexico.</text>
</paragraph></section><section id="H7AF1F094A4F940A2A4535A461B874DD0"><enum>106.</enum><header>Reports</header><text display-inline="no-display-inline">The Secretary shall provide to the
appropriate committees of Congress—</text>
<paragraph id="HC6B1A31B981647B39677D1F3EEBC548D"><enum>(1)</enum><text>within 7 days of
the end of each month commencing with the first month in which transactions are
made under the Program, a written report describing all of the transactions
made during the reporting period pursuant to the authorities granted under this
title;</text>
</paragraph><paragraph id="H4AA1FCB7A1A94ABFA0025C09658EC4B7"><enum>(2)</enum><text display-inline="yes-display-inline">after the end of March and the end of
September, commencing September 30, 2010, a written report on all projected
costs and liabilities, all operating expenses, including compensation for
financial agents, and all transactions made by the Fund, which shall include
participating institutions and amounts each institution has received under the
Program; and</text>
</paragraph><paragraph id="H5A66AE101A4E423B8A7901BE82C3A370"><enum>(3)</enum><text display-inline="yes-display-inline">within 7 days of the end of each month
commencing with the first month in which transactions are made under the
Program, a written report detailing how eligible institutions participating in
the Program have used the funds such institutions received under the
Program.</text>
</paragraph></section><section id="HB60B15622BDF46C8B0A2C59E4AED298E"><enum>107.</enum><header>Oversight and
audits</header>
<subsection id="H0614B9D616FC440ABD8DEA8713689873"><enum>(a)</enum><header>Inspector
General oversight</header><text display-inline="yes-display-inline">The
Inspector General of the Department of the Treasury shall conduct, supervise,
and coordinate audits and investigations of the Program through the Office of
Small Business Lending Fund Program Oversight established under subsection
(b).</text>
</subsection><subsection display-inline="no-display-inline" id="HC70E93F1CCFA4F4CA3AC2519004DF43A"><enum>(b)</enum><header>Office of Small
Business Lending Fund Program Oversight</header>
<paragraph id="H6762F55B7E8A470689E8B4F3E3046A9E"><enum>(1)</enum><header>Establishment</header><text display-inline="yes-display-inline">There is hereby established within the
Office of the Inspector General of the Department of the Treasury a new office
to be named the <quote>Office of Small Business Lending Fund Program
Oversight</quote> to provide oversight of the Program.</text>
</paragraph><paragraph id="H6A93424DE04A4773B8144BFEB4090EBD"><enum>(2)</enum><header>Leadership</header><text display-inline="yes-display-inline">The Inspector General shall appoint a
Special Deputy Inspector General for SBLF Program Oversight to lead the Office,
with commensurate staff, who shall report directly to the Inspector General and
who shall be responsible for the performance of all auditing and investigative
activities relating to the Program.</text>
</paragraph><paragraph id="HE93BF9B236134FC196632B57FCCC6BF9"><enum>(3)</enum><header>Reporting</header>
<subparagraph id="H3D6C846C242E463890AEE70CA3F83BDB"><enum>(A)</enum><header>In
general</header><text>The Inspector General shall issue a report no less than
two times a year to the Congress and the Secretary devoted to the oversight
provided by the Office, including any recommendations for improvements to the
Program.</text>
</subparagraph><subparagraph id="H3E119EAE11904A24B37640BDD1C68921"><enum>(B)</enum><header>Recommendations</header><text>With
respect to any deficiencies identified in a report under subparagraph (A), the
Secretary shall either—</text>
<clause id="H40904CD136CC4574A1EDF377A079ECF0"><enum>(i)</enum><text>take
actions to address such deficiencies; or</text>
</clause><clause id="H62B6957C2FC94CDE841FAD6A6220A2D4"><enum>(ii)</enum><text>certify to the
appropriate committees of Congress that no action is necessary or
appropriate.</text>
</clause></subparagraph></paragraph><paragraph display-inline="no-display-inline" id="H7A2425D95C684B569F2516BE67D667D3"><enum>(4)</enum><header>Coordination</header><text display-inline="yes-display-inline">The Inspector General, in maximizing the
effectiveness of the Office, shall work with other Offices of Inspector
General, as appropriate, to minimize duplication of effort and ensure
comprehensive oversight of the Program.</text>
</paragraph><paragraph id="H60B6E1A80C6B45818F47DA92284823E5"><enum>(5)</enum><header>Termination</header><text>The
Office shall terminate at the end of the 6-month period beginning on the date
on which all capital investments are repaid under the Program or the date on
which the Secretary determines that any remaining capital investments will not
be repaid.</text>
</paragraph><paragraph id="HE2EF018DBEAC42A8B7163C4783C45985"><enum>(6)</enum><header>Definitions</header><text>For
purposes of this subsection:</text>
<subparagraph id="H2B9CF3F028D542B187CA46C022FA7A1F"><enum>(A)</enum><header>Office</header><text display-inline="yes-display-inline">The term <quote>Office</quote> means the
Office of Small Business Lending Fund Program Oversight established under
paragraph (1).</text>
</subparagraph><subparagraph id="H655D920E328C451F96238E3EE1B926CF"><enum>(B)</enum><header>Inspector
General</header><text display-inline="yes-display-inline">The term
<quote>Inspector General</quote> means the Inspector General of the Department
of the Treasury.</text>
</subparagraph></paragraph></subsection><subsection id="H6481F79BF98245A39BF1FB3DCFB59B74"><enum>(c)</enum><header>GAO
audit</header><text display-inline="yes-display-inline">The Comptroller General
of the United States shall perform an annual audit of the Program and issue a
report to the appropriate committees of Congress containing the results of such
audit.</text>
</subsection><subsection id="HEA6C9BDF11D14DB89F8C56EFF7D7FFAB"><enum>(d)</enum><header>Required
certifications</header>
<paragraph id="H7ADEDB9686354EDABA9D685E13163291"><enum>(1)</enum><header>Eligible
institution certification</header><text display-inline="yes-display-inline">Each eligible institution that participate
in the Program must certify that such institution is in compliance with the
requirements of
<external-xref legal-doc="regulation" parsable-cite="cfr/31/103.121">section
103.121</external-xref> of title 31, Code of Federal Regulations, a regulation
that, at a minimum, requires financial institutions, as that term is defined in
<external-xref legal-doc="usc" parsable-cite="usc/31/5312">31 U.S.C.
5312(a)(2)</external-xref> and (c)(1)(A), to implement reasonable procedures to
verify the identity of any person seeking to open an account, to the extent
reasonable and practicable, maintain records of the information used to verify
the person's identity, and determine whether the person appears on any lists of
known or suspected terrorists or terrorist organizations provided to the
financial institution by any government agency.</text>
</paragraph><paragraph id="HEB4415AF619044198DB1CBDF7DEEEA74"><enum>(2)</enum><header>Loan
recipients</header><text display-inline="yes-display-inline">With respect to
funds received by an eligible institution under the Program, any business
receiving a loan from the eligible institution using such funds after the date
of the enactment of this title shall certify to such eligible institution that
the principals of such business have not been convicted of a sex offense
against a minor (as such terms are defined in section 111 of the Sex Offender
Registration and Notification Act (<external-xref legal-doc="usc" parsable-cite="usc/42/16911">42 U.S.C.
16911</external-xref>)).</text>
</paragraph></subsection><subsection display-inline="no-display-inline" id="HA07F1B5519154CABB69B9B7AF1398964"><enum>(e)</enum><header>Prohibition on
pornography</header><text display-inline="yes-display-inline">None of the funds
made available under this title may be used to pay the salary of any individual
engaged in activities related to the Program who has been officially
disciplined for violations of subpart G of the Standards of Ethical Conduct for
Employees of the Executive Branch for viewing, downloading, or exchanging
pornography, including child pornography, on a Federal Government computer or
while performing official Federal Government duties.</text>
</subsection></section><section id="H46B5F3689E8C4C0F8E005E64E749C29B"><enum>108.</enum><header>Credit reform;
Funding</header>
<subsection id="HF0771361FCF948269307AF39E2E4AB02"><enum>(a)</enum><header>Credit
reform</header><text>The cost of purchases of preferred stock and other
financial instruments made as capital investments under this title shall be
determined as provided under the Federal Credit Reform Act of 1990
(<external-xref legal-doc="usc" parsable-cite="usc/2/661">2 U.S.C. 661 et
seq.</external-xref>).</text>
</subsection><subsection id="HEF089E88F3B2464692F0410427436E05"><enum>(b)</enum><header>Funds made
available</header><text display-inline="yes-display-inline">There are hereby
appropriated, out of funds in the Treasury not otherwise appropriated, such
sums as may be necessary to pay the costs of $30,000,000,000 of capital
investments in eligible institutions, including the costs of modifying such
investments, and reasonable costs of administering the program of making,
holding, managing, and selling the capital investments.</text>
</subsection></section><section id="HA1E3E087334A4878A832783E671EAF98"><enum>109.</enum><header>Termination and
continuation of authorities</header>
<subsection id="HE6C6AF87E1DC4DED9DA95C25EA9A1022"><enum>(a)</enum><header>Termination of
investment authority</header><text>The authority to make capital investments in
eligible institutions, including commitments to purchase preferred stock or
other instruments, provided under this title shall terminate 1 year after the
date of enactment of this title.</text>
</subsection><subsection id="H288E420452A64B0283ECD0B4F08C971D"><enum>(b)</enum><header>Continuation of
other authorities</header><text>The authorities of the Secretary in section 104
shall not be limited by the termination date in subsection (a).</text>
</subsection></section><section id="HB646C203D2A8423083D88D1255978C94"><enum>110.</enum><header>Preservation of
authority</header><text display-inline="no-display-inline">Nothing in this
title may be construed to limit the authority of the Secretary under any other
provision of law.</text>
</section><section id="H2B20BE68CEC94052A23E16FEB200E49D"><enum>111.</enum><header>Assurances</header>
<subsection id="HB4E969860C69432296ABB1F5E1CCE3DF"><enum>(a)</enum><header>Small Business
Lending Fund separate from TARP</header><text>The Small Business Lending Fund
Program is established as separate and distinct from the Troubled Asset Relief
Program established by the Emergency Economic Stabilization Act of 2008. An
institution shall not, by virtue of a capital investment under the Small
Business Lending Fund Program, be considered a recipient of the Troubled Asset
Relief Program.</text>
</subsection><subsection id="H3FB2C0A48B4546728699774C85DFCC71"><enum>(b)</enum><header>Change in
law</header><text>If, after a capital investment has been made in an eligible
institution under the Program, there is a change in law that modifies the terms
of the investment or program in a materially adverse respect for the eligible
institution, the eligible institution may, after consultation with the
appropriate Federal banking agency for the eligible institution, repay the
investment without impediment.</text>
</subsection></section><section id="H6064F72FD2D1464EAB888BE4E00AA3A8"><enum>112.</enum><header>Study and
report with respect to women-owned, veteran-owned, and minority-owned
businesses</header>
<subsection id="H2A27D019F3B842BCA17977EF8068DC22"><enum>(a)</enum><header>Study</header><text display-inline="yes-display-inline">The Secretary shall conduct a study to
determine the number of women-owned businesses, veteran-owned businesses, and
minority-owned businesses that receive assistance as a result of the Program
(including determining the percentage of the total number of all businesses
that receive assistance that such number represents), including—</text>
<paragraph id="HF59DE2D5CD5A47DCBB53C50E7CD4D605"><enum>(1)</enum><text display-inline="yes-display-inline">efforts, including technical assistance and
outreach that institutions have employed under the Program to provide loans to
minority-, veteran-, and women-owned small businesses;</text>
</paragraph><paragraph id="H7E031AFCC0AC49A391CE027B41EF3316"><enum>(2)</enum><text>loan applications
received;</text>
</paragraph><paragraph id="HEA962EFFD1C7434C9B33F1043EF2DB01"><enum>(3)</enum><text>loan applications
approved; and</text>
</paragraph><paragraph id="H745367B27BB44DC99FCC3ACC1F77BB17"><enum>(4)</enum><text>and any other
relevant data related to such transactions to promote the purposes of the
Program as the Secretary may require.</text>
</paragraph></subsection><subsection id="HE52A30AB70364E988171290881AC9BED"><enum>(b)</enum><header>Report</header><text display-inline="yes-display-inline">Not later than one year after the date of
enactment of this Act, the Secretary shall submit to Congress a report on the
results of the study conducted pursuant to subsection (a). To the extent
possible, the Secretary shall disaggregate the results of such study by ethnic
group and gender.</text>
</subsection><subsection id="HB0E2BEB59A6942F29B1D64F8AF427805"><enum>(c)</enum><header>Information
provided to the Secretary</header><text>Eligible institutions that participate
in the Program shall provide the Secretary with such information as the
Secretary may require to carry out the study required by this section.</text>
</subsection></section><section display-inline="no-display-inline" id="H87C9B456B64841F3958A4DC014ABD025" section-type="subsequent-section"><enum>113.</enum><header>Temporary
amortization authority</header>
<subsection id="H45D86DFE891146859CA4F67FB237A2AF"><enum>(a)</enum><header>Purpose</header><text display-inline="yes-display-inline">The purpose this section is to address the
ongoing effects of the financial crisis on small businesses by providing
temporary authority to amortize losses or write-downs in order to increase the
availability of credit for small businesses.</text>
</subsection><subsection id="H3D1BADE665344D98969533B6F7500D33"><enum>(b)</enum><header>In
general</header><text display-inline="yes-display-inline">For purposes of
capital calculation under the Financial Institutions Examination Council’s
Consolidated Reports of Condition, an eligible institution may choose to
amortize any loss or write-down, on a quarterly straight line basis over a
period determined under subsection (c), beginning with the month in which such
loss or write-down occurs, resulting from the application of FASB Statement 114
or 144 to—</text>
<paragraph id="HCC611345C72B475B89D53C19A7579C91"><enum>(1)</enum><text>other real estate
owned (as defined under
<external-xref legal-doc="usc" parsable-cite="usc/12/34">section
34.81</external-xref> of title 12, Code of Federal Regulation), or</text>
</paragraph><paragraph id="H994D763BB7B84CAF8457C089A86A935D"><enum>(2)</enum><text>an impared loan
secured by real estate,</text>
</paragraph><continuation-text continuation-text-level="subsection">provided
that the institution discloses the difference in the amount of the
institution’s capital, when calculated taking into account the temporary
amortization, from the amount of the institution’s capital when calculated
without taking into account the temporary amortization on the Financial
Institutions Examination Council’s Consolidated Reports of Condition.</continuation-text></subsection><subsection id="H2A517CD9342D4BE3B31C7B2DF0081DD1"><enum>(c)</enum><header>Amortization
requirements</header><text display-inline="yes-display-inline">During the
initial 2-year period referred to in section 4(d)(4), an eligible institution’s
amortization period shall be adjusted to reflect the following schedule based
on the institution’s change in the amount of small business lending relative to
the baseline:</text>
<paragraph id="H25A5288FBF2F48DE858AA58350694BAD"><enum>(1)</enum><text>If the amount of
small business lending has increased by less than 2.5 percent, the amortization
period shall be 6 years.</text>
</paragraph><paragraph id="H45BAAF51C5EA412BBF882EFFB9BA5F86"><enum>(2)</enum><text>If the amount of
small business lending has increased by 2.5 percent or greater, but by less
than 5.0 percent, the amortization period shall be 7 years.</text>
</paragraph><paragraph id="H546131A8AAF143CC8F1E832DCDB9D6B1"><enum>(3)</enum><text>If the amount of
small business lending has increased by 5.0 percent or greater, but by less
than 7.5 percent, the amortization period shall be 8 years.</text>
</paragraph><paragraph id="H1C300223131748CCB9183876FD606381"><enum>(4)</enum><text>If the amount of
small business lending has increased by 7.5 percent or greater, but by less
than 10.0 percent, the amortization period shall be 9 years.</text>
</paragraph><paragraph id="H50BB7D7C604A4D82937F8BE78A147D43"><enum>(5)</enum><text>If the amount of
small business lending has increased by 10 percent or greater, the amortization
period shall be 10 years.</text>
</paragraph></subsection><subsection id="H245936A7ECB047ADA783E7528AA92824"><enum>(d)</enum><header>Minimum
underwriting standards</header><text display-inline="yes-display-inline">The
appropriate Federal banking agency for an eligible institution that chooses to
amortize any loss or write-down as permitted under subsection (b) shall, within
60 days of the date of the enactment of this title, issue regulations defining
minimum underwriting standards that must be used for loans made by the eligible
institution.</text>
</subsection><subsection id="HCFEA3B4FDFDF4BC9A1091C62169786FE"><enum>(e)</enum><header>Effective
date</header><text display-inline="yes-display-inline">The provisions of this
section shall apply to loan origination that occurred on or after January 1,
2003, and before January 1, 2008.</text>
</subsection></section><section display-inline="no-display-inline" id="H99AAC8A9FC574365AABB217345FA3F7B" section-type="subsequent-section"><enum>114.</enum><header>Sense of
Congress</header><text display-inline="no-display-inline">It is the sense of
Congress that the Federal Deposit Insurance Corporation and other bank
regulators are sending mixed messages to banks regarding regulatory capital
requirements and lending standards, which is a contributing cause of decreased
small business lending and increased regulatory uncertainty at community
banks.</text>
</section><enum>II</enum><header>State Small
Business Credit Initiative</header>
<section id="H162C62F2ED2B4C6AAA36347C6088025E" section-type="subsequent-section"><enum>201.</enum><header>Short
title</header><text display-inline="no-display-inline">This title may be cited
as the <quote>State Small Business Credit Initiative Act of
2010</quote>.</text>
</section><section id="HBF13830566224CC5916423DC313E22B3"><enum>202.</enum><header>Definitions</header><text display-inline="no-display-inline">For purposes of this title, the following
definitions shall apply:</text>
<paragraph id="HABBF5030EA604CC4835AE5E6CE1C469C"><enum>(1)</enum><header>Appropriate
Federal banking agency</header><text>The term <term>appropriate Federal banking
agency</term>—</text>
<subparagraph id="HEECBC45FE4FB4DE0B02B280484ECFC1D"><enum>(A)</enum><text>has the same
meaning as in section 3 of the Federal Deposit Insurance Act; and</text>
</subparagraph><subparagraph id="H18D1D1A0377148499B39F22C00E9C703"><enum>(B)</enum><text>includes the
National Credit Union Administration Board in the case of any credit union the
deposits of which are insured in accordance with the Federal Credit Union
Act.</text>
</subparagraph></paragraph><paragraph id="HDF3D6020E7D54B1B806B5726751BDD8D"><enum>(2)</enum><header>Enrolled
loan</header><text>The term <term>enrolled loan</term> means a loan made by a
financial institution lender that is enrolled by a participating State in an
approved State capital access program in accordance with this title.</text>
</paragraph><paragraph id="H3B4EC1205C134E69AEC400E603A40C93"><enum>(3)</enum><header>Federal
contribution</header><text>The term <term>Federal contribution</term> means the
portion of the contribution made by a participating State to, or for the
account of, an approved State program that is made with Federal funds allocated
to the State by the Secretary under section 203.</text>
</paragraph><paragraph id="H1BEEEF68660547A286774071AA3388F1"><enum>(4)</enum><header>Financial
institution</header><text>The term <term>financial institution</term> means any
insured depository institution, insured credit union, or community development
financial institution, as those terms are each defined in section 103 of the
Riegle Community Development and Regulatory Improvement Act of 1994.</text>
</paragraph><paragraph id="HB29D40D7A0C04C6CBA21501BE589D1AE"><enum>(5)</enum><header>Participating
state</header><text>The term <term>participating State</term> means any State
that has been approved for participation in the Program under section
204.</text>
</paragraph><paragraph id="H696B1B076E3F4ED0B3316071CA9AF11C"><enum>(6)</enum><header>Program</header><text>The
term <term>Program</term> means the State Small Business Credit Initiative
established under this title.</text>
</paragraph><paragraph id="HA7E31A7EC7504EBF95B57F5CC3AE8B5D"><enum>(7)</enum><header>Qualifying loan
or swap funding facility</header><text>The term <term>qualifying loan or swap
funding facility</term> means a contractual arrangement between a participating
State and a private financial entity under which—</text>
<subparagraph id="H88E6CD7C96AB41F285C4701341F5575A"><enum>(A)</enum><text>the participating
State delivers funds to the entity as collateral;</text>
</subparagraph><subparagraph id="H14411C3130474D10889FE47DE10D1751"><enum>(B)</enum><text>the entity
provides funding from the arrangement back to the participating State;
and</text>
</subparagraph><subparagraph id="H753ED9B701C646B788E7E95C325560F9"><enum>(C)</enum><text>the full amount of
resulting funding from the arrangement, less any fees and other costs of the
arrangement, is contributed to, or for the account of, an approved State
program.</text>
</subparagraph></paragraph><paragraph id="HA77A57A0C011481DABD5D9B5874E6317"><enum>(8)</enum><header>Reserve
fund</header><text>The term <term>reserve fund</term> means a fund, established
by a participating State, dedicated to a particular financial institution
lender, for the purposes of—</text>
<subparagraph id="H995051EB25514D92A116DC7EB6909A37"><enum>(A)</enum><text>depositing all
required premium charges paid by the financial institution lender and by each
borrower receiving a loan under an approved State program from that financial
institution lender;</text>
</subparagraph><subparagraph id="H0E367CCA67DF452FA575F06DC787D588"><enum>(B)</enum><text>depositing
contributions made by the participating State, including State contributions
made with Federal contributions; and</text>
</subparagraph><subparagraph id="H8F38F7AD0DD143ADAD85DE18CE8DFC49"><enum>(C)</enum><text>covering losses on
enrolled loans by disbursing accumulated funds.</text>
</subparagraph></paragraph><paragraph id="H2F1AE9A849E64BB592975AF8F2D036B8"><enum>(9)</enum><header>State</header><text>The
term <term>State</term> means—</text>
<subparagraph id="H206A19295D814C6F9CB75D7FCBFC333A"><enum>(A)</enum><text>a State of the
United States;</text>
</subparagraph><subparagraph id="HFE1E78330B9B4DEC9F496E598B61B418"><enum>(B)</enum><text display-inline="yes-display-inline">the District of Columbia, the Commonwealth
of Puerto Rico, the Commonwealth of Northern Mariana Islands, Guam, American
Samoa, and the United States Virgin Islands;</text>
</subparagraph><subparagraph id="H25D83CFB6B4C4C658DAF0166A644753B"><enum>(C)</enum><text>when designated by
a State of the United States, a political subdivision of that State that the
Secretary determines has the capacity to participate in the Program; and</text>
</subparagraph><subparagraph id="HC89592EF71A3450D955ED946B248276B"><enum>(D)</enum><text>under the
circumstances described in section 204(d), a municipality of a State of the
United States to which the Secretary has given a special permission under
section 204(d).</text>
</subparagraph></paragraph><paragraph id="H439F4927E8824D13AF779292F7BA0F44"><enum>(10)</enum><header>State capital
access program</header><text>The term <term>State capital access program</term>
means a program of a State that—</text>
<subparagraph id="HE62BC29879524073B3B4EC54BCD25D82"><enum>(A)</enum><text>uses public
resources to promote private access to credit; and</text>
</subparagraph><subparagraph id="H804C68CB14AE449FA10FD81294BFB9EE"><enum>(B)</enum><text>meets the
eligibility criteria in section 205(c).</text>
</subparagraph></paragraph><paragraph id="H810C1D4C3EEF4ED9ADD2B7DAEDE3A53B"><enum>(11)</enum><header>State other
credit support program</header><text>The term <term>State other credit support
program</term>—</text>
<subparagraph id="H9FCBFA4BE8EF4E9888CB3C25E0234DF3"><enum>(A)</enum><text>means a program of
a State that—</text>
<clause id="H7AC32964B0BE419998D1471507928D70"><enum>(i)</enum><text>uses
public resources to promote private access to credit;</text>
</clause><clause id="H274B3D7B7DA849D989CF86C7EF0F08F0"><enum>(ii)</enum><text>is
not a State capital access program; and</text>
</clause><clause id="HA2FBE760F6874B0784C83418FD32AAD6"><enum>(iii)</enum><text>meets the
eligibility criteria in section 206(c); and</text>
</clause></subparagraph><subparagraph id="H603A957819BC4EEE896E97D736093776"><enum>(B)</enum><text display-inline="yes-display-inline">includes, collateral support programs, loan
participation programs, State-run venture capital fund programs, and credit
guarantee programs.</text>
</subparagraph></paragraph><paragraph id="HF0183AD95AA2480A95E7CA56C6420CDC"><enum>(12)</enum><header>State
program</header><text>The term <term>State program</term> means a State capital
access program or a State other credit support program.</text>
</paragraph><paragraph id="H24007AD98E3F4268810CCFE32C9FB0A2"><enum>(13)</enum><header>Secretary</header><text>The
term <term>Secretary</term> means the Secretary of the Treasury.</text>
</paragraph></section><section id="H5B94FC3D2DB24410B7FB1EF9B33CCC19"><enum>203.</enum><header>Federal funds
allocated to States</header>
<subsection id="H119A0ABDF53941079567D4F698C6AB45"><enum>(a)</enum><header>Program
established; Purpose</header><text>There is established the State Small
Business Credit Initiative (hereinafter in this title referred to as the
<quote>Program</quote>), to be administered by the Secretary. Under the
Program, the Secretary shall allocate Federal funds to participating States and
make the allocated funds available to the participating States as provided in
this section for the uses described in this section.</text>
</subsection><subsection id="HF3A9EA31410C4EFC896FEEB8FC4788B0"><enum>(b)</enum><header>Allocation
formula</header><text></text>
<paragraph id="H939EBCA0FD5045E5974CE298A1862D14"><enum>(1)</enum><header>In
general</header><text>Not later than 30 days after the date of enactment of
this title, the Secretary shall allocate Federal funds to participating States
so that each State is eligible to receive an amount equal to the average of the
respective amounts that the State—</text>
<subparagraph id="H9FD00E30766B41198BA2C52ABFBA2D90"><enum>(A)</enum><text>would receive
under the 2009 allocation, as determined under paragraph (2); and</text>
</subparagraph><subparagraph id="H4999E5BC9C8B465BBAA5BBC13B7BEF10"><enum>(B)</enum><text>would receive
under the 2010 allocation, as determined under paragraph (3).</text>
</subparagraph></paragraph><paragraph id="H3CA95378F6034CFF961942AF83909E4F"><enum>(2)</enum><header>2009 allocation
formula</header>
<subparagraph id="H4AE4B8F924ED4118AD642513BCA2F0A5"><enum>(A)</enum><header>In
general</header><text display-inline="yes-display-inline">The Secretary shall
determine the 2009 allocation by allocating Federal funds among the States in
the proportion that each such State’s 2008 State employment decline bears to
the aggregate of the 2008 State employment declines for all States.</text>
</subparagraph><subparagraph id="HCAAAABD3A702446D950531B5218303A9"><enum>(B)</enum><header>Minimum
allocation</header><text display-inline="yes-display-inline">The Secretary
shall adjust the allocations under subparagraph (A) for each State to the
extent necessary to ensure that no State receives less than 0.9 percent of the
Federal funds.</text>
</subparagraph><subparagraph id="H4A0B95BBA16247C9BF0B35FEF3D2CDED"><enum>(C)</enum><header>2008 State
employment decline defined</header><text>For purposes of this paragraph and
with respect to a State, the term <quote>2008 State employment decline</quote>
means the excess (if any) of—</text>
<clause id="HFC9897CA26C44BB0AE0B0B6E9DDDE055"><enum>(i)</enum><text display-inline="yes-display-inline">the number of individuals employed in such
State determined for December 2007; over</text>
</clause><clause id="HF135DE8D1FFB465E90CFC6FCC941479E"><enum>(ii)</enum><text>the
number of individuals employed in such State determined for December
2008.</text>
</clause></subparagraph></paragraph><paragraph id="H426D571B1C5F48448F07CB14CBBBDDBC"><enum>(3)</enum><header>2010 allocation
formula</header>
<subparagraph id="HAD3361C211104A9E958431C9FD08D399"><enum>(A)</enum><header>In
general</header><text display-inline="yes-display-inline">The Secretary shall
determine the 2010 allocation by allocating Federal funds among the States in
the proportion that each such State’s 2009 unemployment number bears to the
aggregate of the 2009 unemployment numbers for all of the States.</text>
</subparagraph><subparagraph id="HA19F953206724CE993AB98E07CC49D4F"><enum>(B)</enum><header>Minimum
allocation</header><text>The Secretary shall adjust the allocations under
subparagraph (A) for each State to the extent necessary to ensure that no State
receives less than 0.9 percent of the Federal funds.</text>
</subparagraph><subparagraph id="H885354F60CB14DC8ADFF99EB22BE7A4F"><enum>(C)</enum><header>2009
unemployment number defined</header><text>For purposes of this paragraph and
with respect to a State, the term <quote>2009 unemployment number</quote> means
the number of individuals within such State who were determined to be
unemployed by the Bureau of Labor Statistics for December 2009.</text>
</subparagraph></paragraph></subsection><subsection id="H9102D7CA52574F79966C0AC10B176547"><enum>(c)</enum><header>Availability of
allocated amount</header><text>The amount allocated by the Secretary to each
participating State under subsection (b) shall be made available to the State
as follows:</text>
<paragraph id="H03A967CF26DB44D887C5A015FC4A75C1"><enum>(1)</enum><header>Allocated amount
generally to be available to State in one-thirds</header>
<subparagraph id="H7B1952F427FB4C7C8BB430B46C68606D"><enum>(A)</enum><header>In
general</header><text>The Secretary shall—</text>
<clause id="H84B5ED529BF74B6CA28899540989010C"><enum>(i)</enum><text>apportion the
participating State’s allocated amount into one-thirds;</text>
</clause><clause id="H031779A4462341438499881B9823D957"><enum>(ii)</enum><text>transfer to the
participating State the first one-third when the Secretary approves the State
for participation under section 204; and</text>
</clause><clause id="H9194C376813146A0AD20DD1D5A6A6A86"><enum>(iii)</enum><text>transfer to the
participating State each successive one-third when the State has certified to
the Secretary that it has expended, transferred, or obligated 80 percent of the
last transferred one-third for Federal contributions to, or for the account of,
State programs.</text>
</clause></subparagraph><subparagraph id="H5289A600984E4CD9B2A307CEA147D235"><enum>(B)</enum><header>Authority to
withhold pending audit</header><text>The Secretary may withhold the transfer of
any successive one-third pending results of a financial audit.</text>
</subparagraph><subparagraph id="H05F921B4935544D0AE38F7F6A0D2AE51"><enum>(C)</enum><header>Transfers
contingent on Inspector General audits</header>
<clause id="HC5B7EC3C2A8C4972BB50AE19A65779D7"><enum>(i)</enum><header>In
general</header><text display-inline="yes-display-inline">Before a transfer to
a participating State of the second one-third or the last one-third, the
Inspector General of the Department of the Treasury shall carry out an audit of
the participating State’s use of amounts already received.</text>
</clause><clause id="H27B4393AA0A44FC0AC2FEE97667A7E1E"><enum>(ii)</enum><header>Penalty for
misstatement</header><text>Any participating State that is found to have
intentionally misstated any report issued to the Secretary under the Program
shall be ineligible to receive any additional funds under the Program. Funds
that had been allocated or that would otherwise have been allocated to such
participating State shall be paid into the general fund of the Treasury for
reduction of the public debt.</text>
</clause><clause id="H2FD5972D8AAD438A9CCC04C6EF5353A4"><enum>(iii)</enum><header>Municipalities</header><text>For
purposes of this subparagraph, the term <quote>participating State</quote>
shall include a municipality given special permission to participate in the
Program, pursuant to section 204(d).</text>
</clause></subparagraph><subparagraph display-inline="no-display-inline" id="H24E5CAF0A6094C6586BA32F1D5F27447"><enum>(D)</enum><header>Exception</header>
<clause id="H273206B819E94BA4B02C6566603E8456"><enum>(i)</enum><header>In
general</header><text display-inline="yes-display-inline">The Secretary may, in
the Secretary’s discretion, transfer the full amount of the participating
State’s allocated amount to the State in a single transfer if the participating
State applies to the Secretary for approval to use the full amount of the
allocation as collateral for a qualifying loan or swap funding facility.</text>
</clause><clause id="H2BCAD9C8FA0343D48D7F5047A976F011"><enum>(ii)</enum><header>Recoupment
triggered by intentional misstatement</header><text display-inline="yes-display-inline">If, in any audit of a report issued by a
participating State that receives a single transfer pursuant to clause (i), the
Secretary or the Inspector General of the Department of the Treasury determines
that such State intentionally misstated information in such report, the
participating State shall be required to fully repay all amounts received by
the State under the Program, and such amounts shall be paid into the general
fund of the Treasury for reduction of the public debt.</text>
</clause></subparagraph></paragraph><paragraph id="HF91319C89B2E4F19AFF22912A2E7BA0B"><enum>(2)</enum><header>Transferred
amounts</header><text>Each amount transferred to a participating State under
this section shall remain available to the State until used by the State as
permitted under paragraph (3).</text>
</paragraph><paragraph id="H948B045C036D4D4FA87550921BFB7B2A"><enum>(3)</enum><header>Use of
transferred funds</header><text>Each participating State may use funds
transferred to it under this section only—</text>
<subparagraph id="HF5666726A40241CCBFB4F9A6A8B80B72"><enum>(A)</enum><text>for making Federal
contributions to, or for the account of, an approved State program;</text>
</subparagraph><subparagraph id="HF2BDE40B26494A1691A198BFC0700A25"><enum>(B)</enum><text>as collateral for
a qualifying loan or swap funding facility;</text>
</subparagraph><subparagraph id="H6584A4BB3C2C48E487B150435D202163"><enum>(C)</enum><text>in the case of the
first one-third transferred, for paying administrative costs incurred by the
State in implementing an approved State program in an amount not to exceed 5
percent of that first one-third; or</text>
</subparagraph><subparagraph id="H51FC14E377284F25A4840D535F2696F0"><enum>(D)</enum><text>in the case of
each successive one-third transferred, for paying administrative costs incurred
by the State in implementing an approved State program in an amount not to
exceed 3 percent of that successive one-third.</text>
</subparagraph></paragraph><paragraph id="HA3FC89FD39F64FF1AC580DECAD4DA055"><enum>(4)</enum><header>Termination of
availability of amounts not transferred within 2 years of
participation</header><text>Any portion of a participating State’s allocated
amount that has not been transferred to the State under this section by the end
of the 2-year period beginning on the date that the Secretary approves the
State for participation may be deemed by the Secretary to be no longer
allocated to the State and no longer available to the State and shall be
returned to the General Fund of the Treasury.</text>
</paragraph><paragraph display-inline="no-display-inline" id="H122CB84D577141658534D660C94611B6"><enum>(5)</enum><header>Transferred
amounts not assistance</header><text display-inline="yes-display-inline">The
amounts transferred to a participating State under this section shall not be
considered <quote>assistance</quote> for purposes of subtitle V of title 31,
United States Code.</text>
</paragraph><paragraph id="H0E14C3C54089408BA8F7C15289013034"><enum>(6)</enum><header>Definitions</header><text>For
purposes of this section—</text>
<subparagraph id="HD09F645196F042B88B59B644C769988B"><enum>(A)</enum><text>the term
<term>allocated amount</term> means the total amount of Federal funds allocated
by the Secretary under subsection (b) to the participating State; and</text>
</subparagraph><subparagraph id="H1A638CD7C6294680812CB3E5BA86E6F8"><enum>(B)</enum><text>the term
<term>one-third</term> means—</text>
<clause id="H500D045207F046FD859377A375393C3C"><enum>(i)</enum><text>in
the case of the first and second one-thirds, an amount equal to 33 percent of a
participating State’s allocated amount; and</text>
</clause><clause id="H85250CA7B18F4B3E8D34AC150CF4DE23"><enum>(ii)</enum><text>in
the case of the last one-third, an amount equal to 34 percent of a
participating State’s allocated amount.</text>
</clause></subparagraph></paragraph></subsection></section><section id="H3BC549E4C59E44F8B556EF0493B70381"><enum>204.</enum><header>Approving
States for participation</header>
<subsection id="HC1CAAB4F04BE4880994C2FEFE363F2B5"><enum>(a)</enum><header>Application</header><text>Any
State may apply to the Secretary for approval to be a participating State under
the Program and to be eligible for an allocation of Federal funds under the
Program.</text>
</subsection><subsection id="HE963FFCEC6F24833B40F01490A7455C4"><enum>(b)</enum><header>General approval
criteria</header><text>The Secretary shall approve a State to be a
participating State, if—</text>
<paragraph id="H88D0DEF4900B4C30B7722F9AA12DC339"><enum>(1)</enum><text>a
specific department, agency, or political subdivision of the State has been
designated to implement a State program and participate in the Program;</text>
</paragraph><paragraph id="H068B5BA37E654819933BAA27D785284B"><enum>(2)</enum><text>all legal actions
necessary to enable such designated department, agency, or political
subdivision to implement a State program and participate in the Program have
been accomplished;</text>
</paragraph><paragraph id="HB8A6D1C5EEA046AF84FF937C954E0738"><enum>(3)</enum><text>the State has
filed an application with the Secretary for approval of a State capital access
program under section 205 or approval as a State other credit support program
under section 206, in each case within the time period provided in the
respective section; and</text>
</paragraph><paragraph id="H24E8E7ABA26C4BA1A4DE9B5DD8C28D02"><enum>(4)</enum><text>the State and the
Secretary have executed an allocation agreement that—</text>
<subparagraph id="H09E09E7122DD4BFEB254B398686C5F09"><enum>(A)</enum><text>conforms to the
requirements of this title;</text>
</subparagraph><subparagraph id="H70F2E94E51E245078C3F61BF84D27C80"><enum>(B)</enum><text>ensures that the
State program complies with such national standards as are established by the
Secretary under section 209(a)(2);</text>
</subparagraph><subparagraph id="H25A56CA62482430880CEB051576C6E20"><enum>(C)</enum><text>sets forth
internal control, compliance, and reporting requirements as established by the
Secretary, and such other terms and conditions necessary to carry out the
purposes of this title, including an agreement by the State to allow the
Secretary to audit State programs;</text>
</subparagraph><subparagraph id="H0AE29D5712BF4063BBDEBB785349D8B6"><enum>(D)</enum><text>requires that the
State program be fully positioned, within 90 days of the State’s execution of
the allocation agreement with the Secretary, to act on providing the kind of
credit support that the State program was established to provide; and</text>
</subparagraph><subparagraph id="HD8A903F6A53A4733A7DF643F281360D2"><enum>(E)</enum><text>includes an
agreement by the State to deliver to the Secretary, and update annually, a
schedule describing how the State intends to apportion among its State programs
the Federal funds allocated to the State.</text>
</subparagraph></paragraph></subsection><subsection id="HBD493D87B625494484AC502BFFC6DB46"><enum>(c)</enum><header>Contractual
arrangements for implementation of State programs</header><text>A State may be
approved to be a participating State, and be eligible for an allocation of
Federal funds under the Program, if the State has contractual arrangements for
the implementation and administration of its State program with—</text>
<paragraph id="H96D9094E8A5740D6B4B2304B457A8D9C"><enum>(1)</enum><text>an existing,
approved State program administered by another State; or</text>
</paragraph><paragraph id="H0996970499D44C5A9A7B9550B047885E"><enum>(2)</enum><text>an authorized
agent of, or entity supervised by, the State, including for-profit and
not-for-profit entities.</text>
</paragraph></subsection><subsection id="H1FA8EF29CB9D4CB5A1349E75ACE5AABE"><enum>(d)</enum><header>Special
permission</header><text></text>
<paragraph id="H7517F32851194C5E98C8C4B4FF4A30C9"><enum>(1)</enum><header>Circumstances
when a municipality may apply directly</header><text>If a State does not,
within 60 days after the date of enactment of this title, file with the
Secretary a notice of its intent to apply for approval by the Secretary of a
State program or within 9 months after the date of enactment of this title,
file with the Secretary a complete application for approval of a State program,
the Secretary may grant to municipalities of that State a special permission
that will allow them to apply directly to the Secretary without the State for
approval to be participating municipalities.</text>
</paragraph><paragraph id="HA19D036B1B2540CA8FAD0D0AED1D89DC"><enum>(2)</enum><header>Timing
requirements applicable to municipalities applying directly</header><text>To
qualify for the special permission, a municipality of a State must, within 12
months after the date of enactment of this title, file with the Secretary a
complete application for approval by the Secretary of a State program.</text>
</paragraph><paragraph id="H8EC00E84DC5C4E09BEC83C937A15CAD0"><enum>(3)</enum><header>Notices of
intent and applications from more than 1 municipality</header><text>A
municipality of a State may combine with 1 or more other municipalities of that
State to file a joint notice of intent to file and a joint application.</text>
</paragraph><paragraph id="H6626C1E2454F464792A2C96836EC164C"><enum>(4)</enum><header>Approval
criteria</header><text>The general approval criteria in paragraphs (2) and (4)
shall apply.</text>
</paragraph><paragraph id="H089C64FB9F3D47A5B6492D835FEC4B6E"><enum>(5)</enum><header>Allocation to
municipalities</header><text></text>
<subparagraph id="HB702660F57684A55BB9A67D5FCBB4768"><enum>(A)</enum><header>If more than
3</header><text>If more than 3 municipalities, or combination of municipalities
as provided in paragraph (3), of a State apply for approval by the Secretary to
be participating municipalities under this subsection, and the applications
meet the approval criteria in paragraph (4), the Secretary shall allocate
Federal funds to the 3 municipalities with the largest populations.</text>
</subparagraph><subparagraph id="HDA1F5BAEA82348D7BE3EB9AA97E934EF"><enum>(B)</enum><header>If 3 or
fewer</header><text>If 3 or fewer municipalities, or combination of
municipalities as provided in paragraph (3), of a State apply for approval by
the Secretary to be participating municipalities under this subsection, and the
applications meet the approval criteria in paragraph (4), the Secretary shall
allocate Federal funds to each applicant municipality or combination of
municipalities.</text>
</subparagraph></paragraph><paragraph id="HE5FB40C888694739AA1AAC2B5C91DC14"><enum>(6)</enum><header>Apportionment of
allocated amount among participating municipalities</header><text>If the
Secretary approves municipalities to be participating municipalities under this
subsection, the Secretary shall apportion the full amount of the Federal funds
that are allocated to that State to municipalities that are approved under this
subsection in amounts proportionate to the population of those municipalities,
based on the most recent available decennial census.</text>
</paragraph><paragraph id="HD777DCC2E7BC4A77BFD9C9F808215268"><enum>(7)</enum><header>Approving State
programs for municipalities</header><text>If the Secretary approves
municipalities to be participating municipalities under this subsection, the
Secretary shall take into account the additional considerations in section
206(d) in making the determination under section 205 or 206 that the State
program or programs to be implemented by the participating municipalities,
including a State capital access program, is eligible for Federal contributions
to, or for the account of, the State program.</text>
</paragraph></subsection></section><section id="H7A4208653C1F449F82A4974F47A6C985"><enum>205.</enum><header>Approving State
capital access programs</header>
<subsection id="H8109BC67545748A3A8159E70B04EAFA6"><enum>(a)</enum><header>Application</header><text>A
participating State that establishes a new, or has an existing, State capital
access program that meets the eligibility criteria in subsection (c) may apply
to Secretary to have the State capital access program approved as eligible for
Federal contributions to the reserve fund.</text>
</subsection><subsection id="HD17DAD08C68B4761ACEE61A822DD1B1F"><enum>(b)</enum><header>Approval</header><text>The
Secretary shall approve such State capital access program as eligible for
Federal contributions to the reserve fund if—</text>
<paragraph id="H32662C6A2DF24295A0775DCB54E2281F"><enum>(1)</enum><text>within 60 days
after the date of enactment of this title, the State has filed with the
Secretary a notice of intent to apply for approval by the Secretary of a State
capital access program;</text>
</paragraph><paragraph id="HFBAB7A547FD745F28A02E8D817F4FF47"><enum>(2)</enum><text>within 9 months
after the date of enactment of this title, the State has filed with the
Secretary a complete application for approval by the Secretary of a capital
access program;</text>
</paragraph><paragraph id="H90949E1607064121B6CF3D4162C25039"><enum>(3)</enum><text>the State
satisfies the requirements of subsections (a) and (b) of section 204;
and</text>
</paragraph><paragraph id="H83C83CCB8ACD4430A359993E0D725E58"><enum>(4)</enum><text>the State capital
access program meets the eligibility criteria in subsection (c).</text>
</paragraph></subsection><subsection id="H0E45FF6F452E4FB5AA13D91F07CF7CF7"><enum>(c)</enum><header>Eligibility
criteria for State capital access programs</header><text>For a State capital
access program to be approved under this section, it must be a program of the
State that—</text>
<paragraph id="HB99D7E86875940A9965CC88A03CCCEC4"><enum>(1)</enum><text>provides portfolio
insurance for business loans based on a separate loan-loss reserve fund for
each financial institution;</text>
</paragraph><paragraph id="H205E3930A1CC439F93BE30B1F6F2323E"><enum>(2)</enum><text>requires insurance
premiums to be paid by the financial institution lenders and by the business
borrowers to the reserve fund to have their loans enrolled in the reserve
fund;</text>
</paragraph><paragraph id="HC929E65B35CC471C9248096BEA18FC86"><enum>(3)</enum><text>provides for
contributions to be made by the State to the reserve fund in amounts at least
equal to the sum of the amount of the insurance premium charges paid by the
borrower and the financial institution to the reserve fund for any newly
enrolled loan; and</text>
</paragraph><paragraph id="HA1BB9D97D7DA408EA6569BD6DFE092FA"><enum>(4)</enum><text>provides its
portfolio insurance solely for loans that meet both the following
requirements:</text>
<subparagraph id="H3AD299B5110E407E943B736DB71EE77E"><enum>(A)</enum><text>The borrower has
500 employees or less at the time that the loan is enrolled in the
Program.</text>
</subparagraph><subparagraph id="HB512E3F953424E628C5A9F04C69A8871"><enum>(B)</enum><text>The loan amount
does not exceed $5,000,000.</text>
</subparagraph></paragraph></subsection><subsection id="H641B5606162D4ABFAE0D55AD1B3A634B"><enum>(d)</enum><header>Federal
contributions to approved State capital access programs</header><text>A State
capital access program approved under this section will be eligible for
receiving Federal contributions to the reserve fund in an amount equal to the
sum of the amount of the insurance premium charges paid by the borrowers and by
the financial institution to the reserve fund for loans that meet the
requirements in subsection (c)(4). A participating State may use the Federal
contribution to make its contribution to the reserve fund of an approved State
capital access program.</text>
</subsection><subsection id="HC9508C222B0E4AC185B07C4694998907"><enum>(e)</enum><header>Minimum program
requirements for State capital access programs</header><text>The Secretary
shall, by regulation or other guidance, prescribe Program requirements that
meet the following minimum requirements:</text>
<paragraph id="HE3857CFEBFB947A18986A721E8999000"><enum>(1)</enum><header>Experience and
capacity</header><text>The participating State shall determine for each
financial institution that participates in the State capital access program,
after consultation with the appropriate Federal banking agency or, in the case
of a financial institution that is a non depository community development
financial institution, the Community Development Financial Institution Fund,
that the financial institution has sufficient commercial lending experience and
financial and managerial capacity to participate in the approved State capital
access program. The determination by the State shall not be reviewable by the
Secretary.</text>
</paragraph><paragraph id="H37AA0DBA58BD421190A0DE77A0CAEF5C"><enum>(2)</enum><header>Investment
authority</header><text>Subject to applicable State law, the participating
State may invest, or cause to be invested, funds held in a reserve fund by
establishing a deposit account at the financial institution lender in the name
of the participating State. In the event that funds in the reserve fund are not
deposited in such an account, such funds shall be invested in a form that the
participating State determines is safe and liquid.</text>
</paragraph><paragraph id="HECDC0B17AE244042A3687F7C9F2C0638"><enum>(3)</enum><header>Loan terms and
conditions to be determined by agreement</header><text>A loan to be filed for
enrollment in an approved State capital access program may be made with such
interest rate, fees, and other terms and conditions, and the loan may be
enrolled in the approved State capital access program and claims may be filed
and paid, as agreed upon by the financial institution lender and the borrower,
consistent with applicable law.</text>
</paragraph><paragraph id="HE95A80EB9E7243AB8BDAB8A5E124A495"><enum>(4)</enum><header>Lender capital
at-risk</header><text>A loan to be filed for enrollment in the State capital
access program must require the financial institution lender to have a
meaningful amount of its own capital resources at risk in the loan.</text>
</paragraph><paragraph id="H91CBBC3CFB034255B4506D5604622FB5"><enum>(5)</enum><header>Premium charges
minimum and maximum amounts</header><text>The insurance premium charges payable
to the reserve fund by the borrower and the financial institution lender shall
be prescribed by the financial institution lender, within minimum and maximum
limits that require that the sum of the insurance premium charges paid in
connection with a loan by the borrower and the financial institution lender may
not be less than 2 percent nor more than 7 percent of the amount of the loan
enrolled in the approved State capital access program.</text>
</paragraph><paragraph id="H18AD6F94464646EAB65C895070851B05"><enum>(6)</enum><header>State
contributions</header><text>In enrolling a loan in an approved State capital
access program, the participating State may make a contribution to the reserve
fund to supplement Federal contributions made under this Program.</text>
</paragraph><paragraph id="H196E8E52ACFD471BB80F20935A546DB3"><enum>(7)</enum><header>Loan
purpose</header>
<subparagraph id="H4BCA4404B7D2484EAD5AA53DF8F91B04"><enum>(A)</enum><header>Particular loan
purpose requirements and prohibitions</header><text>In connection with the
filing of a loan for enrollment in an approved State capital access program,
the financial institution lender—</text>
<clause id="H980BA93D091A488CB99FF872B5BB95DC"><enum>(i)</enum><text>shall obtain an
assurance from each borrower that—</text>
<subclause id="HAFD5DAFF04CD4BE6950819BC403F2A70"><enum>(I)</enum><text>the proceeds of
the loan will be used for a business purpose;</text>
</subclause><subclause id="HEE156CBD2D21492395524E2B68DB5736"><enum>(II)</enum><text>the loan will not
be used to finance such business activities as the Secretary, by regulation,
may proscribe as prohibited loan purposes for enrollment in an approved State
capital access program; and</text>
</subclause><subclause id="H83FDE355C2894DE189E78F4C25443A93"><enum>(III)</enum><text>the borrower is
not—</text>
<item id="H4D3508931CA64E7DAC14FDB5C6A550D8"><enum>(aa)</enum><text display-inline="yes-display-inline">an executive officer, director, or
principal shareholder of the financial institution lender;</text>
</item><item id="H4D4A125EBFA94E01AA03790BA0244819"><enum>(bb)</enum><text>a
member of the immediate family of an executive officer, director, or principal
shareholder of the financial institution lender; or</text>
</item><item id="H40B75726AC6542AE8F0525C8B7BFC34F"><enum>(cc)</enum><text>a
related interest of any such executive officer, director, principal
shareholder, or member of the immediate family;</text>
</item></subclause></clause><clause id="H8EE6847E92E349E8B884E3EFCC885DA1"><enum>(ii)</enum><text>shall provide
assurances to the participating State that the loan has not been made in order
to place under the protection of the approved State capital access program
prior debt that is not covered under the approved State capital access program
and that is or was owed by the borrower to the financial institution lender or
to an affiliate of the financial institution lender;</text>
</clause><clause id="H4859A88847324B2DAF0B74F8CBBA6D64"><enum>(iii)</enum><text>shall not allow
the enrollment of a loan to a borrower that is a refinancing of a loan
previously made to that borrower by the financial institution lender or an
affiliate of the financial institution lender; and</text>
</clause><clause id="H15EB871FA7FA4E39AD390A75F2CFFD5D"><enum>(iv)</enum><text>may
include additional restrictions on the eligibility of loans or borrowers that
are not inconsistent with the provisions and purposes of this title, including
compliance with all applicable Federal and State laws, regulations, ordinances,
and Executive orders.</text>
</clause></subparagraph><subparagraph id="HE05220BF38BC4A979606CE03C05D7593"><enum>(B)</enum><header>Definitions</header><text display-inline="yes-display-inline">For purposes of this subsection, the terms
<term>executive officer</term>, <term>director</term>, <term>principal
shareholder</term>, <term>immediate family</term>, and <quote>related
interest</quote> refer to the same relationship to a financial institution
lender as the relationship described in part 215 of title 12 of the Code of
Federal Regulations, or any successor to such part.</text>
</subparagraph></paragraph><paragraph display-inline="no-display-inline" id="HDA9D2F8702A04C0B9AFFA58EB7BEDDD2"><enum>(8)</enum><header>Capital access
for small businesses in underserved communities</header><text display-inline="yes-display-inline">At the time that a State applies to the
Secretary to have the State capital access program approved as eligible for
Federal contributions, the State shall deliver to the Secretary a report
stating how the State plans to use the Federal contributions to the reserve
fund to provide access to capital for small businesses in low- and
moderate-income, minority, and other underserved communities, including women-
and minority-owned small businesses.</text>
</paragraph></subsection></section><section id="HD89C0B220B104C49A6972C6D5472F602"><enum>206.</enum><header>Approving
collateral support and other innovative credit access and guarantee initiatives
for small businesses and manufacturers</header>
<subsection id="HA2352D8E07BE4610B14790C425B61C77"><enum>(a)</enum><header>Application</header><text>A
participating State that establishes a new, or has an existing, credit support
program that meets the eligibility criteria in subsection (c) may apply to the
Secretary to have the State other credit support program approved as eligible
for Federal contributions to, or for the account of, the State program.</text>
</subsection><subsection id="HDF46DEE0D8094EEE9F5E4DAA2F8EF9F2"><enum>(b)</enum><header>Approval</header><text>The
Secretary shall approve such State other credit support program as eligible for
Federal contributions to, or for the account of, the program if—</text>
<paragraph id="HA52934D7C086437CAEB81B5CC171D48E"><enum>(1)</enum><text>the Secretary
determines that the State satisfies the requirements of paragraphs (1) through
(3) of section 205(b);</text>
</paragraph><paragraph id="HD2B96708957F4D72AD5B62EA838159D9"><enum>(2)</enum><text>the Secretary
determines that the State other credit support program meets the eligibility
criteria in subsection (c);</text>
</paragraph><paragraph id="HAE7138F870474E4CA822AC6EF87603A1"><enum>(3)</enum><text>the Secretary
determines the State other credit support program to be eligible based on the
additional considerations in subsection (d); and</text>
</paragraph><paragraph id="H6F20DE2674F649969137DA8D0CEEBF64"><enum>(4)</enum><text>within 9 months
after the date of enactment of this title, the State has filed with Treasury a
complete application for Treasury approval.</text>
</paragraph></subsection><subsection id="H9BF3CC37EFA4455696A861E95C66FF86"><enum>(c)</enum><header>Eligibility
criteria for State other credit support programs</header><text>For a State
other credit support program to be approved under this section, it must be a
program of the State that—</text>
<paragraph id="H92E5CF1AE0CE4D20A1F94CFF93FEC19B"><enum>(1)</enum><text>can demonstrate
that, at a minimum, 1 dollar of public investment by the State program will
cause and result in 1 dollar of new private credit;</text>
</paragraph><paragraph id="H3691166596E64DB4A2E95F2BA0601235"><enum>(2)</enum><text>can demonstrate a
reasonable expectation that, when considered with all other State programs of
the State, such State programs together have the ability to use amounts of new
Federal contributions to, or for the account of, all such programs in the State
to cause and result in amounts of new small business lending at least 10 times
the new Federal contribution amount;</text>
</paragraph><paragraph id="HCEA63431ECC14AF8B8EB8D1259173884"><enum>(3)</enum><text>for those State
other credit support programs that provide their credit support through 1 or
more financial institution lenders, requires the financial institution lenders
to have a meaningful amount of their own capital resources at risk in their
small business lending; and</text>
</paragraph><paragraph id="HD74308CF97C64EB1B83A84349214C591"><enum>(4)</enum><text display-inline="yes-display-inline">uses Federal funds allocated under this
title to extend credit support that—</text>
<subparagraph id="HFEEAAB3B411E4647B404240CD485DEA9"><enum>(A)</enum><text>targets an average
borrower size of 500 employees or less;</text>
</subparagraph><subparagraph id="HD9B1D5B2EA604FF3844DADA42CBED90F"><enum>(B)</enum><text>does not extend
credit support to borrowers that have more than 750 employees;</text>
</subparagraph><subparagraph id="HA45A702420984C96A87397AF23F3B09E"><enum>(C)</enum><text>targets support
towards loans with an average principal amount of $5,000,000 or less;
and</text>
</subparagraph><subparagraph id="H466E2D129C9E48C0B3B5561BC09B311D"><enum>(D)</enum><text>does not extend
credit support to loans that exceed a principal amount of $20,000,000.</text>
</subparagraph></paragraph></subsection><subsection id="H0A9218620CBB496FA3A5D55925061DC9"><enum>(d)</enum><header>Additional
considerations</header><text>In making a determination that a State other
credit support program is eligible for Federal contributions to, or for the
account of, the State program, the Secretary shall take into account the
following additional considerations:</text>
<paragraph id="H2DE62F301A6B4F2A9C1959FE09E76E1D"><enum>(1)</enum><text>The anticipated
benefits to the State, its businesses, and its residents to be derived from the
Federal contributions to, or for the account of, the approved State other
credit support program, including the extent to which resulting small business
lending will expand economic opportunities.</text>
</paragraph><paragraph id="H54833AFD87714B74A78B1F07D28F18F6"><enum>(2)</enum><text>The operational
capacity, skills, and experience of the management team of the State other
credit support program.</text>
</paragraph><paragraph id="H0F47CD0BEFC2451C946DE0A9EEB50F2B"><enum>(3)</enum><text>The capacity of
the State other credit support program to manage increases in the volume of its
small business lending.</text>
</paragraph><paragraph id="HFC384401FA324158BB1A3FB10781C148"><enum>(4)</enum><text>The internal
accounting and administrative controls systems of the State other credit
support program, and the extent to which they can provide reasonable assurance
that funds of the State program are safeguarded against waste, loss,
unauthorized use, or misappropriation.</text>
</paragraph><paragraph id="HB9C265FF04C14FF4A0A951E9A93B756C"><enum>(5)</enum><text>The soundness of
the program design and implementation plan of the State other credit support
program.</text>
</paragraph></subsection><subsection id="H6925117298AA41DEA5112174DD3D0373"><enum>(e)</enum><header>Federal
contributions to approved State other credit support programs</header><text>A
State other credit support program approved under this section will be eligible
for receiving Federal contributions to, or for the account of, the State
program in an amount consistent with the schedule describing the apportionment
of allocated Federal funds among State programs delivered by the State to the
Secretary under the allocation agreement.</text>
</subsection><subsection id="H9167720C1AB44F6893634821B9750A37"><enum>(f)</enum><header>Minimum program
requirements for State other credit support programs</header>
<paragraph id="HB543A908EAA64855904AE473D1A47CDA"><enum>(1)</enum><header>Fund to
prescribe</header><text>The Secretary shall, by regulation or other guidance,
prescribe Program requirements for approved State other credit support
programs.</text>
</paragraph><paragraph id="H9FD11A9ACE2A4C6594AFBCB44D287E59"><enum>(2)</enum><header>Considerations
for fund</header><text>In prescribing minimum Program requirements for approved
State other credit support programs, the Secretary shall take into
consideration, to the extent the Secretary determines applicable and
appropriate, the minimum Program requirements for approved State capital access
programs in section 205(e).</text>
</paragraph></subsection></section><section id="H9FEA493523884153916EFC4C64B87944"><enum>207.</enum><header>Reports</header>
<subsection id="HF595AD78F62B44679DC4E8F763BD8706"><enum>(a)</enum><header>Quarterly
use-of-funds report</header>
<paragraph id="H6AB113ADFA9C451A98BA8E735D508254"><enum>(1)</enum><header>In
general</header><text>Not later than 30 days after the beginning of each
calendar quarter, beginning after the first full calendar quarter to occur
after the date the Secretary approves a State for participation, the
participating State shall submit to the Secretary a report on the use of
Federal funding by the participating State during the previous calendar
quarter.</text>
</paragraph><paragraph id="H2FE597F27164408982FFBECD86141D84"><enum>(2)</enum><header>Report
contents</header><text>The report shall—</text>
<subparagraph id="H10ABB5F3DE104A4AB8ACFDDD361E3490"><enum>(A)</enum><text>indicate the total
amount of Federal funding used by the participating State;</text>
</subparagraph><subparagraph id="HF9A62BB652B648659385AE92784E4FFD"><enum>(B)</enum><text>include a
certification by the participating State that—</text>
<clause id="HD2A2F2000C114A96B54F1669D70EEBCC"><enum>(i)</enum><text>the
information provided in accordance with subparagraph (A) is accurate;</text>
</clause><clause id="H3F51896B0142411AB38CAD676C266A1C"><enum>(ii)</enum><text>funds continue to
be available and legally committed to contributions by the State to, or for the
account of, approved State programs, less any amount that has been contributed
by the State to, or for the account of, approved State programs subsequent to
the State being approved for participation in the Program; and</text>
</clause><clause id="H9D362F3CF3C241E483940320109134E2"><enum>(iii)</enum><text>the
participating State is implementing its approved State program or programs in
accordance with this title and regulations issued pursuant to section
210.</text>
</clause></subparagraph></paragraph></subsection><subsection id="HCD2332A15BB64731A57183FC49130032"><enum>(b)</enum><header>Annual
report</header><text>Not later than March 31 of each year, beginning March 31,
2011, each participating State shall submit to the Secretary an annual report
that shall include the following information:</text>
<paragraph id="HDD364C79EA29416DA6FB984AEEA05360"><enum>(1)</enum><text>The number of
borrowers that received new loans originated under the approved State program
or programs after the State program was approved as eligible for Federal
contributions.</text>
</paragraph><paragraph id="H2BEE00EBC03C48508FD70975E85DB262"><enum>(2)</enum><text>The total amount
of such new loans.</text>
</paragraph><paragraph id="HE46FB6A546074541AD1DF2946CEFA99D"><enum>(3)</enum><text>Breakdowns by
industry type, loan size, annual sales, and number of employees of the
borrowers that received such new loans.</text>
</paragraph><paragraph id="H345D67AF4D6740238A178DBC60DA7AB6"><enum>(4)</enum><text>The zip code of
each borrower that received such a new loan.</text>
</paragraph><paragraph id="HE4B46D07DE0C46DD8D5E4137170377EC"><enum>(5)</enum><text>Such other data as
the Secretary, in the Secretary’s sole discretion, may require to carry out the
purposes of the Program.</text>
</paragraph></subsection><subsection id="H83938862604B4A67B94B15129C79389E"><enum>(c)</enum><header>Form</header><text>The
reports and data filed pursuant to subsections (a) and (b) shall be in such
form as the Secretary, in the Secretary’s sole discretion, may require.</text>
</subsection><subsection id="HFBFF52936C304A64B516231F0E79F0ED"><enum>(d)</enum><header>Termination of
reporting requirements</header><text>The requirement to submit reports under
subsections (a) and (b) shall terminate for a participating State with the
submission of the completed reports due on the first March 31 to occur after 5
complete 12-month periods after the State is approved by the Secretary to be a
participating State.</text>
</subsection></section><section id="H3B1062097B874EA99E785FEDFE78FC86"><enum>208.</enum><header>Remedies for
State program termination or failures</header>
<subsection id="H48F0D47E80254D448CCE2A299029D526"><enum>(a)</enum><header>Remedies</header><text></text>
<paragraph id="HE653A686F7BD407D8CA782E73BB4EFB4"><enum>(1)</enum><header>In
general</header><text>If any of the events listed in paragraph (2) occur, the
Secretary, in the Secretary’s discretion, may—</text>
<subparagraph id="H4A0A26A9C6B34588ABB9FC90ED3E125F"><enum>(A)</enum><text>reduce the amount
of Federal funds allocated to the State under the Program; or</text>
</subparagraph><subparagraph id="H76FAB92719A74EF7928C450006AEEC9C"><enum>(B)</enum><text>terminate any
further transfers of allocated amounts that have not yet been transferred to
the State.</text>
</subparagraph></paragraph><paragraph id="H459D0938EB444726818F0EDFAD0BE316"><enum>(2)</enum><header>Causal
events</header><text>The events referred to in paragraph (1) are—</text>
<subparagraph id="H4CC37925E4FD430C8D1FB510FDC7E3E7"><enum>(A)</enum><text>termination by a
participating State of its participation in the Program;</text>
</subparagraph><subparagraph id="H15D808C47B264AC0A32C7D339A214AC7"><enum>(B)</enum><text>failure on the
part of a participating State to submit complete reports under section 207 on a
timely basis; or</text>
</subparagraph><subparagraph id="H25C0A587D9AF4E2588F064E39138D1E4"><enum>(C)</enum><text>noncompliance by
the State with the terms of the allocation agreement between the Secretary and
the State.</text>
</subparagraph></paragraph></subsection><subsection id="HF767D6652C0C48C9A37092B9E5040B2B"><enum>(b)</enum><header>Deallocated
amounts to be reallocated</header><text>If, after 13 months, any portion of the
amount of Federal funds allocated to a participating State is deemed by the
Secretary to be no longer allocated to the State after actions taken by the
Secretary under subsection (a)(1), the Secretary shall reallocate that portion
among the participating States, excluding the State whose allocated funds were
deemed to be no longer allocated, as provided in section 203(b).</text>
</subsection></section><section id="HFB0C09829D0E4FDC86D6E24E74C98FE4"><enum>209.</enum><header>Implementation
and administration</header>
<subsection id="HE756504F38F847859EC7B67FBEDFDADF"><enum>(a)</enum><header>General
authorities and duties</header><text>The Secretary shall—</text>
<paragraph id="H8522F86FEA7A4196A3E6022C675DBE02"><enum>(1)</enum><text>consult with the
Administrator of the Small Business Administration and the appropriate Federal
banking agencies on the administration of the Program;</text>
</paragraph><paragraph id="H9A349697F93442CEA8C008ED3D1EC335"><enum>(2)</enum><text>establish minimum
national standards for approved State programs;</text>
</paragraph><paragraph id="HE4D3BD3016E5484EA789ED7F7476AB24"><enum>(3)</enum><text>provide technical
assistance to States for starting State programs and generally disseminate best
practices;</text>
</paragraph><paragraph id="H60A1BE7066CE42FBAC66A2FF1B0CFE15"><enum>(4)</enum><text>manage,
administer, and perform necessary program integrity functions for the Program;
and</text>
</paragraph><paragraph id="HDB40ED9ED9D24101B5FA98EE26DD26B9"><enum>(5)</enum><text>ensure adequate
oversight of the approved State programs, including oversight of the cash
flows, performance, and compliance of each approved State program.</text>
</paragraph></subsection><subsection id="H958F0AEB9BE04443AFFCC18D2836896D"><enum>(b)</enum><header>Appropriations</header><text display-inline="yes-display-inline">There is hereby appropriated to the
Secretary, out of funds in the Treasury not otherwise appropriated,
$2,000,000,000 to carry out the Program, including to pay reasonable costs of
administering the Program.</text>
</subsection><subsection id="H5C02A8B30C694EA1851E90A5A9DC875B"><enum>(c)</enum><header>Termination of
secretary’s program administration functions</header><text>The authorities and
duties of the Secretary to implement and administer the Program shall terminate
at the end of the 7-year period beginning on the date of enactment of this
title.</text>
</subsection></section><section id="H925C7265024D4445B98A27B6023AAEA9"><enum>210.</enum><header>Regulations</header><text display-inline="no-display-inline">The Secretary, in consultation with the
Administrator of the Small Business Administration, shall issue such
regulations and other guidance as the Secretary determines necessary or
appropriate to implement this title including, but not limited to, to define
terms, to establish compliance and reporting requirements, and such other terms
and conditions necessary to carry out the purposes of this title.</text>
</section><section id="H98870BE844EB47BFBA9301634545401F"><enum>211.</enum><header>Oversight and
audits</header>
<subsection id="HD556415540EC48D8A4F719601B173DE9"><enum>(a)</enum><header>Inspector
General oversight</header><text display-inline="yes-display-inline">The
Inspector General of the Department of the Treasury shall conduct, supervise,
and coordinate audits and investigations of the use of funds made available
under the Program.</text>
</subsection><subsection id="H2C6DB9537FAE4FD48A11B7D9DBCB9DB7"><enum>(b)</enum><header>GAO
audit</header><text display-inline="yes-display-inline">The Comptroller General
of the United States shall perform an annual audit of the Program and issue a
report to the appropriate committees of Congress, as such term is defined under
section 3(1), containing the results of such audit.</text>
</subsection><subsection id="H13D2B23AD20F4E6C97CF95DD4F6FC5AA"><enum>(c)</enum><header>Required
certification</header>
<paragraph id="HD6DF6CA9E2DE495290B838668C128C32"><enum>(1)</enum><header>Financial
institutions certification</header><text display-inline="yes-display-inline">With respect to funds received by a
participating State under the Program, any financial institution that receives
a loan, a loan guarantee, or other financial assistance using such funds after
the date of the enactment of this title must certify that such institution is
in compliance with the requirements of
<external-xref legal-doc="regulation" parsable-cite="cfr/31/103.121">section
103.121</external-xref> of title 31, Code of Federal Regulations, a regulation
that, at a minimum, requires financial institutions, as that term is defined in
<external-xref legal-doc="usc" parsable-cite="usc/31/5312">31 U.S.C.
5312(a)(2)</external-xref> and (c)(1)(A), to implement reasonable procedures to
verify the identity of any person seeking to open an account, to the extent
reasonable and practicable, maintain records of the information used to verify
the person's identity, and determine whether the person appears on any lists of
known or suspected terrorists or terrorist organizations provided to the
financial institution by any government agency.</text>
</paragraph><paragraph id="HC482A11DA6794AF08B7739D9FA663474"><enum>(2)</enum><header>Sex offense
certification</header><text>With respect to funds received by a participating
State under the Program, any private entity that receives a loan, a loan
guarantee, or other financial assistance using such funds after the date of the
enactment of this title shall certify to the participating State that the
principals of such entity have not been convicted of a sex offense against a
minor (as such terms are defined in section 111 of the Sex Offender
Registration and Notification Act (<external-xref legal-doc="usc" parsable-cite="usc/42/16911">42 U.S.C.
16911</external-xref>)).</text>
</paragraph></subsection><subsection display-inline="no-display-inline" id="H0FD7BEB2F7AF4D159B6575CC46015C74"><enum>(d)</enum><header>Prohibition on
pornography</header><text display-inline="yes-display-inline">None of the funds
made available under this title may be used to pay the salary of any individual
engaged in activities related to the Program who has been officially
disciplined for violations of subpart G of the Standards of Ethical Conduct for
Employees of the Executive Branch for viewing, downloading, or exchanging
pornography, including child pornography, on a Federal Government computer or
while performing official Federal Government duties.</text>
</subsection></section><enum>III</enum><header>Small business
early-stage investment program</header>
<section id="HB8D0349E01C24E7995CC9C48FEB1CACA"><enum>301.</enum><header>Short
title</header><text display-inline="no-display-inline">This title may be cited
as the <quote>Small Business Early-Stage Investment Program Act of
2010</quote>.</text>
</section><section id="HE10BBBE7DA5F45C8A91E39292CDCBA8E"><enum>302.</enum><header>Small business
early-stage investment program</header><text display-inline="no-display-inline">Title III of the Small Business Investment
Act of 1958 (<external-xref legal-doc="usc" parsable-cite="usc/15/681">15
U.S.C. 681 et seq.</external-xref>) is amended by adding at the end the
following:</text>
<quoted-block display-inline="no-display-inline" id="HA0831C0AE67A4D4EA16569A89676F44D" style="OLC">
<part id="H3BB192950B944FB9B0EFC3D365D201BC"><enum>D</enum><header>Small business
early-stage investment program</header>
<section id="HD036DBF7086846699E42BF850A622A7E"><enum>399A.</enum><header>Establishment
of program</header><text display-inline="no-display-inline">The Administrator
shall establish and carry out an early-stage investment program (hereinafter
referred to in this part as the <quote>program</quote>) to provide equity
investment financing to support early-stage small businesses in accordance with
this part.</text>
</section><section id="HFF1B631E48AD40AAA8D6916B68171215"><enum>399B.</enum><header>Administration
of program</header><text display-inline="no-display-inline">The program shall
be administered by the Administrator acting through the Associate Administrator
described under section 201.</text>
</section><section id="HA5965B3DFBAE45ECAEEDBB6B4AA6CB8C"><enum>399C.</enum><header>Applications</header>
<subsection id="H70A021B6CF9046AEBFFBEF3C99B53AA1"><enum>(a)</enum><header>In
general</header><text display-inline="yes-display-inline">Any existing or newly
formed incorporated body, limited liability company, or limited partnership
organized and chartered or otherwise existing under Federal or State law for
the purpose of performing the functions and conducting the activities
contemplated under the program and any manager of any small business investment
company may submit to the Administrator an application to participate in the
program.</text>
</subsection><subsection id="H095B22E94B12414198B49AE5776DDE5D"><enum>(b)</enum><header>Requirements for
application</header><text>An application to participate in the program shall
include the following:</text>
<paragraph id="H644385FC72EF4D48B879A1BB888F354F"><enum>(1)</enum><text display-inline="yes-display-inline">A business plan describing how the
applicant intends to make successful venture capital investments in early-stage
small businesses and direct capital to small business concerns in targeted
industries or other business sectors.</text>
</paragraph><paragraph id="H9243DC2829E84FC3B13B46BA7DEBD0E5"><enum>(2)</enum><text>Information
regarding the relevant venture capital investment qualifications and
backgrounds of the individuals responsible for the management of the
applicant.</text>
</paragraph><paragraph id="H9159851CFBDC40EFBE1E0959670D09B6"><enum>(3)</enum><text>A description of
the extent to which the applicant meets the selection criteria under section
399D.</text>
</paragraph></subsection><subsection id="H43C926852B5B4496A746BA44A85DECDD"><enum>(c)</enum><header>Applications
from managers of small business investment companies</header><text display-inline="yes-display-inline">The Administrator shall establish an
abbreviated application process for applicants that are managers of small
business investment companies that are licensed under section 301 and that are
applying to participate in the program. Such abbreviated process shall
incorporate a presumption that such managers satisfactorily meet the selection
criteria under paragraphs (3) and (5) of section 399D(b).</text>
</subsection></section><section id="H8266900221A146CEA45E0A34A37B384F"><enum>399D.</enum><header>Selection of
participating investment companies</header>
<subsection id="HD5848131F4204F5B8F1ADB576F373D55"><enum>(a)</enum><header>In
general</header><text display-inline="yes-display-inline">Not later than 90
days after the date on which the Administrator receives an application from an
applicant under section 399C, the Administrator shall make a determination to
conditionally approve or disapprove such applicant to participate in the
program and shall transmit such determination to the applicant in writing. A
determination to conditionally approve an applicant shall identify all
conditions necessary for a final approval and shall provide a period of not
less than one year for satisfying such conditions.</text>
</subsection><subsection id="H3980A0E6A43E4257844031EBFC7CCEC6"><enum>(b)</enum><header>Selection
criteria</header><text>In making a determination under subsection (a), the
Administrator shall consider each of the following:</text>
<paragraph id="H03A1612FF5D54D92AFC5910E8F3743CD"><enum>(1)</enum><text display-inline="yes-display-inline">The likelihood that the applicant will meet
the goals specified in the business plan of the applicant.</text>
</paragraph><paragraph id="H8F9C098431414FD3B5D32C5C45217437"><enum>(2)</enum><text>The likelihood
that the investments of the applicant will create or preserve jobs, both
directly and indirectly.</text>
</paragraph><paragraph id="H2EAF796659784464B2D935720AE6E86B"><enum>(3)</enum><text>The character and
fitness of the management of the applicant.</text>
</paragraph><paragraph id="HC53797EADE404AF59B3092AF63A1F6F3"><enum>(4)</enum><text>The experience and
background of the management of the applicant.</text>
</paragraph><paragraph id="HA85A75D2E2B0484E8186A220A5E31086"><enum>(5)</enum><text>The extent to
which the applicant will concentrate investment activities on early-stage small
businesses.</text>
</paragraph><paragraph id="HA375BA0C346D4F5B9FC48ED8F340F241"><enum>(6)</enum><text>The likelihood
that the applicant will achieve profitability.</text>
</paragraph><paragraph id="HF49D532D989E4BBF82E5DF3DC40B5D7F"><enum>(7)</enum><text>The experience of
the management of the applicant with respect to establishing a profitable
investment track record.</text>
</paragraph><paragraph id="H4035B9699D774FF1BD9F419C434939DD"><enum>(8)</enum><text display-inline="yes-display-inline">The extent to which the applicant will
concentrate investment activities on small business concerns in targeted
industries.</text>
</paragraph></subsection><subsection id="HA5DA4906833D430DBA167A446043DFFB"><enum>(c)</enum><header>Final
approval</header><text display-inline="yes-display-inline">For each applicant
provided a conditional approval under subsection (a), the Administrator shall
provide final approval to participate in the program not later than 90 days
after the date the applicant satisfies the conditions specified by the
Administrator under such subsection or, in the case of applicants whose
partnership or management agreements conform to models approved by the
Administrator, the Administrator shall provide final approval to participate in
the program not later than 30 days after the date the applicant satisfies the
conditions specified under such subsection. If an applicant provided
conditional approval under subsection (a) fails to satisfy the conditions
specified by the Administrator in the time period designated under such
subsection, the Administrator shall revoke the conditional approval.</text>
</subsection></section><section id="HC88DE8E111B747FCA7396BF3FD07A42F"><enum>399E.</enum><header>Equity
financings</header>
<subsection id="HE619C6C6DA59473D8DEF80CC1F896E75"><enum>(a)</enum><header>In
general</header><text display-inline="yes-display-inline">The Administrator may
make one or more equity financings to a participating investment
company.</text>
</subsection><subsection id="HCEB7DC8264404265A2155E0119C453BD"><enum>(b)</enum><header>Equity financing
amounts</header>
<paragraph id="H8F6DC26AF2E94D73A348C524F213348A"><enum>(1)</enum><header>Non-Federal
capital</header><text display-inline="yes-display-inline">An equity financing
made to a participating investment company under the program may not be in an
amount that exceeds the amount of the capital of such company that is not from
a Federal source and that is available for investment on or before the date on
which an equity financing is drawn upon. Such capital may include legally
binding commitments with respect to capital for investment.</text>
</paragraph><paragraph id="H6B29DB866513439A8862DBAE7FA1136C"><enum>(2)</enum><header>Limitation on
aggregate amount</header><text>The aggregate amount of all equity financings
made to a participating investment company under the program may not exceed
$100,000,000.</text>
</paragraph></subsection><subsection id="HF35EAE845BF14EA4AFE61305847412B9"><enum>(c)</enum><header>Equity financing
process</header><text display-inline="yes-display-inline">In making an equity
financing under the program, the Administrator shall commit an equity financing
amount to a participating investment company and the amount of each such
commitment shall remain available to be drawn upon by such company—</text>
<paragraph id="HABE81803703E4C699E7466DCF0B81ED3"><enum>(1)</enum><text>for new-named
investments during the 5-year period beginning on the date on which each such
commitment is first drawn upon; and</text>
</paragraph><paragraph id="HE173C1B3BC934838AE64911D7A25FBC7"><enum>(2)</enum><text display-inline="yes-display-inline">for follow-on investments and management
fees during the 10-year period beginning on the date on which each such
commitment is first drawn upon, with not more than 2 additional 1-year periods
available at the discretion of the Administrator.</text>
</paragraph></subsection><subsection id="H95AFE7A585F146A8A23D2DD83F6CC906"><enum>(d)</enum><header>Commitment of
funds</header><text display-inline="yes-display-inline">The Administrator shall
make commitments for equity financings not later than 2 years after the date
funds are appropriated for the program.</text>
</subsection></section><section id="H21546BC32F0E4A45B0952DBD819C76D1"><enum>399F.</enum><header>Investments in
early-stage small businesses</header>
<subsection id="H31B933D80B5440379B2C2201EA6BB65D"><enum>(a)</enum><header>In
general</header><text display-inline="yes-display-inline">As a condition of
receiving an equity financing under the program, a participating investment
company shall make all of the investments of such company in small business
concerns, of which at least 50 percent shall be early-stage small
businesses.</text>
</subsection><subsection id="HBA023D477AA840BAB6521C8F559CE1EA"><enum>(b)</enum><header>Evaluation of
compliance</header><text>With respect to an equity financing amount committed
to a participating investment company under section 399E, the Administrator
shall evaluate the compliance of such company with the requirements under this
section if such company has drawn upon 50 percent of such commitment.</text>
</subsection></section><section id="H80C8006A7C6C4BE0B730109DAAF36ADA"><enum>399G.</enum><header>Pro rata
investment shares</header><text display-inline="no-display-inline">Each
investment made by a participating investment company under the program shall
be treated as comprised of capital from equity financings under the program
according to the ratio that capital from equity financings under the program
bears to all capital available to such company for investment.</text>
</section><section id="HC6245B2264B445BBB992D658CBAF32DC"><enum>399H.</enum><header>Equity
financing interest</header>
<subsection id="HFC74DE7AD46E40F8BC702A34C54C0C5A"><enum>(a)</enum><header>Equity financing
Interest</header>
<paragraph id="HC5094619A2B6455D9D22B3976AC3BA10"><enum>(1)</enum><header>In
general</header><text>As a condition of receiving an equity financing under the
program, a participating investment company shall convey an equity financing
interest to the Administrator in accordance with paragraph (2).</text>
</paragraph><paragraph id="HDA6DD665A68B4F2ABAB77ACE34F94ED0"><enum>(2)</enum><header>Effect of
conveyance</header><text>The equity financing interest conveyed under paragraph
(1) shall have all the rights and attributes of other investors attributable to
their interests in the participating investment company, but shall not denote
control or voting rights to the Administrator. The equity financing interest
shall entitle the Administrator to a pro rata portion of any distributions made
by the participating investment company equal to the percentage of capital in
the participating investment company that the equity financing comprises. The
Administrator shall receive distributions from the participating investment
company at the same times and in the same amounts as any other investor in the
company with a similar interest. The investment company shall make allocations
of income, gain, loss, deduction, and credit to the Administrator with respect
to the equity financing interest as if the Administrator were an
investor.</text>
</paragraph></subsection><subsection id="H89C470814C8E43B99136EBCDFF41BF81"><enum>(b)</enum><header>Manager
profits</header><text display-inline="yes-display-inline">As a condition of
receiving an equity financing under the program, the manager profits interest
payable to the managers of a participating investment company under the program
shall not exceed 20 percent of profits, exclusive of any profits that may
accrue as a result of the capital contributions of any such managers with
respect to such company. Any excess of this amount, less taxes payable thereon,
shall be returned by the managers and paid to the investors and the
Administrator in proportion to the capital contributions and equity financings
paid in. No manager profits interest (other than a tax distribution) shall be
paid prior to the repayment to the investors and the Administrator of all
contributed capital and equity financings made.</text>
</subsection><subsection id="H318EA357E673483CA41D598220BEA726"><enum>(c)</enum><header>Distribution
requirements</header><text>As a condition of receiving an equity financing
under the program, a participating investment company shall make all
distributions to all investors in cash and shall make distributions within a
reasonable time after exiting investments, including following a public
offering or market sale of underlying investments.</text>
</subsection></section><section id="H2321FE7BCEB347F781FC1101998A368C"><enum>399I.</enum><header>Fund</header><text display-inline="no-display-inline">There is hereby created within the Treasury
a separate fund for equity financings which shall be available to the
Administrator subject to annual appropriations as a revolving fund to be used
for the purposes of the program. All amounts received by the Administrator,
including any moneys, property, or assets derived by the Administrator from
operations in connection with the program, shall be deposited in the fund. All
expenses and payments, excluding administrative expenses, pursuant to the
operations of the Administrator under the program shall be paid from the
fund.</text>
</section><section id="HC00DBCF450984796A76F506355A9820F"><enum>399J.</enum><header>Application of
other sections</header><text display-inline="no-display-inline">To the extent
not inconsistent with requirements under this part, the Administrator may apply
sections 309, 311, 312, 313, and 314 to activities under this part and an
officer, director, employee, agent, or other participant in a participating
investment company shall be subject to the requirements under such
sections.</text>
</section><section id="H923A010769974C0EA1ADFC40F192FB4B"><enum>399K.</enum><header>Annual
reporting</header><text display-inline="no-display-inline">The Administrator
shall report on the performance of the program in the annual performance report
of the Administration.</text>
</section><section id="H7DCF06D9807449B78159FF0C095C3DA7"><enum>399L.</enum><header>Definitions</header><text display-inline="no-display-inline">In this part, the following definitions
apply:</text>
<paragraph id="H017C0933F805465392A92CE7CC910DA9"><enum>(1)</enum><header>Early-stage
small business</header><text>The term <term>early-stage small business</term>
means a small business concern that—</text>
<subparagraph id="HD0E918A4AAC44E1984A1398A8C68F10B"><enum>(A)</enum><text>is domiciled in a
State; and</text>
</subparagraph><subparagraph id="H0DB63EBB492E478AA0345965DC4BBF00"><enum>(B)</enum><text display-inline="yes-display-inline">has not generated gross annual sales
revenues exceeding $15,000,000 in any of the previous 3 years.</text>
</subparagraph></paragraph><paragraph display-inline="no-display-inline" id="H98067F06B9E543DB92F29E49C6006CE0"><enum>(2)</enum><header>Participating
investment company</header><text display-inline="yes-display-inline">The term
<term>participating investment company</term> means an applicant approved under
section 399D to participate in the program.</text>
</paragraph><paragraph id="H6FB26944099247E888FFA3D1E0542F6B"><enum>(3)</enum><header>Targeted
industries</header><text>The term <term>targeted industries</term> means any of
the following business sectors:</text>
<subparagraph id="H85F1926F02944C80BF9EFECFE11C161F"><enum>(A)</enum><text>Agricultural
technology.</text>
</subparagraph><subparagraph id="H347A1252C25349A29E79E4A07525A380"><enum>(B)</enum><text>Energy
technology.</text>
</subparagraph><subparagraph id="H1E435AFD9E2246F9BAD5C50773F94EC6"><enum>(C)</enum><text>Environmental
technology.</text>
</subparagraph><subparagraph id="H9094387604F442049792FD262A3816E4"><enum>(D)</enum><text>Life
science.</text>
</subparagraph><subparagraph id="H0D76E329BDA6438DBADC47B3DD898D37"><enum>(E)</enum><text>Information
technology.</text>
</subparagraph><subparagraph id="H4632F3601AD44DE7A3A9F1A634BD4523"><enum>(F)</enum><text>Digital
media.</text>
</subparagraph><subparagraph id="H712F32853EE74052A7616A618C87785F"><enum>(G)</enum><text>Clean
technology.</text>
</subparagraph><subparagraph id="H521B2279097D4754B731F3146D61905E"><enum>(H)</enum><text>Defense
technology.</text>
</subparagraph><subparagraph id="H4225DBF4D4CA4A3C84DE714B83C657C6"><enum>(I)</enum><text>Photonics
technology.</text>
</subparagraph></paragraph></section><section display-inline="no-display-inline" id="H731D163A0286491EA96C86C7B6CB5C30" section-type="subsequent-section"><enum>399M.</enum><header>Appropriation</header><text display-inline="no-display-inline">From funds not otherwise appropriated, there
is hereby appropriated $1,000,000,000 to carry out the program.</text>
</section><section id="H9A42B10DEDE0430DA54D1BADE7208BA2"><enum>399N.</enum><header>Certification</header>
<subsection id="H2FDF34B962C44C588B7A9C19990D38C7"><enum>(a)</enum><header>Immigration
certification</header>
<paragraph id="H8AB4E58746F440F6B17777B0D9131F5B"><enum>(1)</enum><header>Participating
investment companies</header><text display-inline="yes-display-inline">Each
participating investment company that receives an equity financing under this
part after the date of the enactment of this part must, if applicable, certify
that such company is in compliance with the requirements of
<external-xref legal-doc="regulation" parsable-cite="cfr/31/103.121">section
103.121</external-xref> of title 31, Code of Federal Regulations, a regulation
that, at a minimum, requires financial institutions, as that term is defined in
<external-xref legal-doc="usc" parsable-cite="usc/31/5312">31 U.S.C.
5312(a)(2)</external-xref> and (c)(1)(A), to implement reasonable procedures to
verify the identity of any person seeking to open an account, to the extent
reasonable and practicable, maintain records of the information used to verify
the person's identity, and determine whether the person appears on any lists of
known or suspected terrorists or terrorist organizations provided to the
financial institution by any government agency.</text>
</paragraph><paragraph id="HB9903BA6806341D39543447A23107E1A"><enum>(2)</enum><header>Early-stage
small businesses</header><text display-inline="yes-display-inline">Each
early-stage small business that receives funds from a participating investment
company that receives an equity financing under this part after the date of the
enactment of this part must, if applicable, certify that such company is in
compliance with the requirements of
<external-xref legal-doc="regulation" parsable-cite="cfr/31/103.121">section
103.121</external-xref> of title 31, Code of Federal Regulations, a regulation
that, at a minimum, requires financial institutions, as that term is defined in
<external-xref legal-doc="usc" parsable-cite="usc/31/5312">31 U.S.C.
5312(a)(2)</external-xref> and (c)(1)(A), to implement reasonable procedures to
verify the identity of any person seeking to open an account, to the extent
reasonable and practicable, maintain records of the information used to verify
the person's identity, and determine whether the person appears on any lists of
known or suspected terrorists or terrorist organizations provided to the
financial institution by any government agency.</text>
</paragraph></subsection><subsection id="H90FB6B06F4D54201A8CD4643FF92CAB2"><enum>(b)</enum><header>Sex offender
certification</header>
<paragraph id="H5CDFF286C38641DBB91896E9DD5182C3"><enum>(1)</enum><header>Participating
investment companies</header><text display-inline="yes-display-inline">Each
participating investment company that receives an equity financing under this
part after the date of the enactment of this part shall certify to the
Administrator that the principals of such company have not been convicted of a
sex offense against a minor (as such terms are defined in section 111 of the
Sex Offender Registration and Notification Act (<external-xref legal-doc="usc" parsable-cite="usc/42/16911">42 U.S.C. 16911</external-xref>)).</text>
</paragraph><paragraph id="H9FDF9837F53C4DCBA999FC8147741ABF"><enum>(2)</enum><header>Early-stage
small businesses</header><text display-inline="yes-display-inline">Each
early-stage small business that receives funds from a participating investment
company that receives an equity financing under this part after the date of the
enactment of this part shall certify to the Administrator that the principals
of such business have not been convicted of a sex offense against a minor (as
such terms are defined in section 111 of the Sex Offender Registration and
Notification Act (<external-xref legal-doc="usc" parsable-cite="usc/42/16911">42 U.S.C. 16911</external-xref>)).</text>
</paragraph></subsection><subsection id="H25E6DABB72994316A80433A7BA9F3B56"><enum>(c)</enum><header>Pornography
certification</header><text display-inline="yes-display-inline">None of the
funds made available under this part may be used to pay the salary of any
individual engaged in activities related to the provisions of this part who has
been officially disciplined for violations of subpart G of the Standards of
Ethical Conduct for Employees of the Executive Branch for viewing, downloading,
or exchanging pornography, including child pornography, on a Federal Government
computer or while performing official Federal Government
duties.</text>
</subsection></section></part><after-quoted-block>.</after-quoted-block></quoted-block>
</section><section id="H0504F1A64EEB4AFEB34DC5AE977403AC"><enum>303.</enum><header>Regulations</header><text display-inline="no-display-inline">Not later than 180 days after the date of
enactment of this Act, the Administrator shall issue regulations to carry out
this title and the amendments made by this title.</text>
</section><section id="H8C381193798E4684B87F50C25A0744DA"><enum>304.</enum><header>Prohibitions on
earmarks</header><text display-inline="no-display-inline">None of the funds
appropriated for the program established under part D of title III of the Small
Business Investment Act of 1958, as added by this Act, may be used for a
Congressional earmark as defined in clause 9(e) of rule XXI of the Rules of the
House of Representatives.</text>
</section><enum>IV</enum><header>Miscellaneous</header>
<section id="HEA276E8A600D40EE8A086ACCDDF2D89F"><enum>401.</enum><header>Budgetary
effects</header><text display-inline="no-display-inline">The budgetary effects
of this Act, for the purpose of complying with the Statutory Pay-As-You-Go Act
of 2010, shall be determined by reference to the latest statement titled
<quote>Budgetary Effects of PAYGO Legislation</quote> for this Act, submitted
for printing in the Congressional Record by the Chairman of the House Budget
Committee, provided that such statement has been submitted prior to the vote on
passage.</text>
</section><enum>V</enum><header>Tax
provisions</header>
<section display-inline="no-display-inline" id="HDA1CCCA7FE0F467FA2E849E9846159B0" section-type="subsequent-section"><enum>500.</enum><header>Short title;
etc</header>
<subsection commented="no" id="H0F0E232AB7334A1D9D3BBB08F8E8128F"><enum>(a)</enum><header>Short
title</header><text display-inline="yes-display-inline">This title may be cited
as the <quote><short-title>Small Business Jobs Tax Relief
Act of 2010</short-title></quote>.</text>
</subsection><subsection id="H2DA7400DB563491DBF9890232B06859A"><enum>(b)</enum><header>Amendment of
1986 Code</header><text>Except as otherwise expressly provided, whenever in
this title an amendment or repeal is expressed in terms of an amendment to, or
repeal of, a section or other provision, the reference shall be considered to
be made to a section or other provision of the Internal Revenue Code of
1986.</text>
</subsection></section><subtitle id="HF882E5FFE82D40B5BD91AEF70E36E22F"><enum>A</enum><header>Small business tax
incentives</header>
<part id="H76EA82F632F8406D8095DDA324FAE0DE"><enum>1</enum><header>General
provisions</header>
<section id="H01C81C7C7FF642D08E38DD3C08B84D2D"><enum>501.</enum><header>Temporary
exclusion of 100 percent of gain on certain small business stock</header>
<subsection id="H8737445E9F8644F98045E97A0A481523"><enum>(a)</enum><header>In
general</header><text display-inline="yes-display-inline">Subsection (a) of
<external-xref legal-doc="usc" parsable-cite="usc/26/1202">section
1202</external-xref> is amended by adding at the end the following new
paragraph:</text>
<quoted-block display-inline="no-display-inline" id="HACA3465A0FD6407CBE76D3894EF6E8C1" style="OLC">
<paragraph id="HAB67D28C07CE4294A3A6143DF5C1BA90"><enum>(4)</enum><header>Special 100
percent exclusion</header><text display-inline="yes-display-inline">In the case
of qualified small business stock acquired after March 15, 2010, and before
January 1, 2012—</text>
<subparagraph id="HAC7030DECB7749AFB0D2E45463F9C00C"><enum>(A)</enum><text>paragraph (1)
shall be applied by substituting <quote>100 percent</quote> for <quote>50
percent</quote>,</text>
</subparagraph><subparagraph id="HB2861A013C1940DFBA981E6596031DAD"><enum>(B)</enum><text>paragraph (2)
shall not apply, and</text>
</subparagraph><subparagraph id="H44F35D3BCB0C46CCBBA2B1D8BD1FFC29"><enum>(C)</enum><text>paragraph (7) of
section 57(a) shall not
apply.</text>
</subparagraph></paragraph><after-quoted-block>.</after-quoted-block></quoted-block>
</subsection><subsection commented="no" id="H615FA564CD0A4D8AB3C0DC7335527DB9"><enum>(b)</enum><header>Conforming
amendments</header><text>Paragraph (3) of
<external-xref legal-doc="usc" parsable-cite="usc/26/1202">section
1202(a)</external-xref> is amended—</text>
<paragraph commented="no" id="H24914AD5558A4239B62F749D665B730D"><enum>(1)</enum><text>by striking
<quote>after the date of the enactment of this paragraph and before January 1,
2011</quote> and inserting <quote>after February 17, 2009, and before March 16,
2010</quote>; and</text>
</paragraph><paragraph commented="no" id="HEA5A87E7591040C397AFFFE56730D48A"><enum>(2)</enum><text>by striking
<quote><header-in-text level="paragraph" style="OLC">Special rules for 2009 and
2010</header-in-text></quote> in the heading and inserting
<quote><header-in-text level="paragraph" style="OLC">Special 75 percent
exclusion</header-in-text></quote>.</text>
</paragraph></subsection><subsection commented="no" id="H696B8002C6B440A2AC1E3DC14DCAD64B"><enum>(c)</enum><header>Effective
date</header><text>The amendments made by this section shall apply to stock
acquired after March 15, 2010.</text>
</subsection></section></part><part id="H9AC4791081044297B0D35DA9F602F4AC"><enum>2</enum><header>Limitations and
reporting on certain penalties</header>
<section display-inline="no-display-inline" id="H74294319800E4DA7A71D1C94E1C5C39E" section-type="subsequent-section"><enum>511.</enum><header>Limitation on
penalty for failure to disclose certain information</header>
<subsection id="H91768103389D487CB4C8B99355A00224"><enum>(a)</enum><header>In
general</header><text display-inline="yes-display-inline">Subsection (b) of
<external-xref legal-doc="usc" parsable-cite="usc/26/6707A">section
6707A</external-xref> is amended to read as follows:</text>
<quoted-block display-inline="no-display-inline" id="HA8D8C8120F46401790B7A81306D79BC6" style="OLC">
<subsection id="H40457E02B1FC4E148ED7772F92E76034"><enum>(b)</enum><header>Amount of
penalty</header>
<paragraph id="H71E4700978484CFBABB1638BAE79D408"><enum>(1)</enum><header>In
general</header><text display-inline="yes-display-inline">Except as otherwise
provided in this subsection, the amount of the penalty under subsection (a)
with respect to any reportable transaction shall be 75 percent of the decrease
in tax shown on the return as a result of such transaction (or which would have
resulted from such transaction if such transaction were respected for Federal
tax purposes).</text>
</paragraph><paragraph id="HBBD2DC0EC9E245F898471A3F08FB6431"><enum>(2)</enum><header>Maximum
penalty</header><text>The amount of the penalty under subsection (a) with
respect to any reportable transaction for any taxable year shall not
exceed—</text>
<subparagraph id="H55100F8EA8DC434F9C751198CE0543B8"><enum>(A)</enum><text>in the case of a
listed transaction, $200,000 ($100,000 in the case of a natural person),
or</text>
</subparagraph><subparagraph id="HDA44294CBE1147FA826219F4D43DE9D5"><enum>(B)</enum><text>in the case of any
other reportable transaction, $50,000 ($10,000 in the case of a natural
person).</text>
</subparagraph></paragraph><paragraph id="H9BBA8D0BEA6E49228D405E7D4ACB646C"><enum>(3)</enum><header>Minimum
penalty</header><text>The amount of the penalty under subsection (a) with
respect to any transaction for any taxable year shall not be less than $10,000
($5,000 in the case of a natural
person).</text>
</paragraph></subsection><after-quoted-block>.</after-quoted-block></quoted-block>
</subsection><subsection id="H66DFF5724FBB45A99590CA5858EC0257"><enum>(b)</enum><header>Effective
date</header><text>The amendment made by this section shall apply to penalties
assessed after December 31, 2006.</text>
</subsection></section><section commented="no" display-inline="no-display-inline" id="HEB888863FC9849C1A43BCA36DA8409D6" section-type="subsequent-section"><enum>512.</enum><header>Annual reports on
penalties and certain other enforcement actions</header>
<subsection commented="no" id="H604CEC0D5DBB48B69DFA766FEFE70073"><enum>(a)</enum><header>In
general</header><text display-inline="yes-display-inline">The Commissioner of
Internal Revenue, in consultation with the Secretary of the Treasury, shall
submit to the Committee on Ways and Means of the House of Representatives and
the Committee on Finance of the Senate an annual report on the penalties
assessed by the Internal Revenue Service during the preceding year under each
of the following provisions of the Internal Revenue Code of 1986:</text>
<paragraph commented="no" id="H428D478720094E1A92EBC1FB1CD15403"><enum>(1)</enum><text>Section 6662A
(relating to accuracy-related penalty on understatements with respect to
reportable transactions).</text>
</paragraph><paragraph commented="no" id="H8015128B09DF4C288D5F879172E96D56"><enum>(2)</enum><text>Section 6700(a)
(relating to promoting abusive tax shelters).</text>
</paragraph><paragraph commented="no" id="H7F3E4358623041869DF3B129870A480F"><enum>(3)</enum><text>Section 6707
(relating to failure to furnish information regarding reportable
transactions).</text>
</paragraph><paragraph commented="no" id="HB94EEB6986B14110A0DB1671027B765C"><enum>(4)</enum><text>Section 6707A
(relating to failure to include reportable transaction information with
return).</text>
</paragraph><paragraph commented="no" id="H38083187AF3A423C9203256550F36C03"><enum>(5)</enum><text>Section 6708
(relating to failure to maintain lists of advisees with respect to reportable
transactions).</text>
</paragraph></subsection><subsection commented="no" id="H82D7D42A764F413ABE98B8F4ADA270D9"><enum>(b)</enum><header>Additional
information</header><text>The report required under subsection (a) shall also
include information on the following with respect to each year:</text>
<paragraph commented="no" id="HD221546397F44B31A62DE22482F9714B"><enum>(1)</enum><text>Any action taken
under <external-xref legal-doc="usc" parsable-cite="usc/31/330">section
330(b)</external-xref> of title 31, United States Code, with respect to any
reportable transaction (as defined in
<external-xref legal-doc="usc" parsable-cite="usc/26/6707A">section
6707A(c)</external-xref> of the Internal Revenue Code of 1986).</text>
</paragraph><paragraph commented="no" id="H15622B09A9E1489198343EFC0EE1B752"><enum>(2)</enum><text>Any extension of
the time for assessment of tax enforced, or assessment of any amount under such
an extension, under paragraph (10) of
<external-xref legal-doc="usc" parsable-cite="usc/26/6501">section
6501(c)</external-xref> of the Internal Revenue Code of 1986.</text>
</paragraph></subsection><subsection commented="no" id="H9348A7D57EB4442EB1E73FBAFB2FC572"><enum>(c)</enum><header>Date of
report</header><text>The first report required under subsection (a) shall be
submitted not later than December 31, 2010.</text>
</subsection></section></part><part id="H86394B13F2BA45638D6CF07E0417A1B4"><enum>3</enum><header>Other
provisions</header>
<section display-inline="no-display-inline" id="H0467DF4E78214F83A17E218C281AAB7C" section-type="subsequent-section"><enum>521.</enum><header>Increase in amount
allowed as deduction for start-up expenditures</header>
<subsection id="H746021E965D3453DBC465725F9EE1A01"><enum>(a)</enum><header>In
general</header><text display-inline="yes-display-inline">Subsection (b) of
<external-xref legal-doc="usc" parsable-cite="usc/26/195">section
195</external-xref> is amended by adding at the end the following new
paragraph:</text>
<quoted-block display-inline="no-display-inline" id="HB31619B439DA49E492ED9DE80D2E8E4F" style="OLC">
<paragraph id="H9B1939234E5E4D7FA7DDAB421EEC732D"><enum>(3)</enum><header>Increased
limitation for taxable years beginning in 2010 or 2011</header><text display-inline="yes-display-inline">In the case of any taxable year beginning
in 2010 or 2011, paragraph (1)(A)(ii) shall be applied—</text>
<subparagraph id="HE6829853AEF14D79A4513DB9C36A9483"><enum>(A)</enum><text>by substituting
<quote>$20,000</quote> for <quote>$5,000</quote>, and</text>
</subparagraph><subparagraph id="HC2687E46A7054ACFA88500BCC6D65B8F"><enum>(B)</enum><text>by substituting
<quote>$75,000</quote> for
<quote>$50,000</quote>.</text>
</subparagraph></paragraph><after-quoted-block>.</after-quoted-block></quoted-block>
</subsection><subsection id="HB1A2AF5853C44D28844F89DEE3B269C0"><enum>(b)</enum><header>Effective
date</header><text>The amendments made by this section shall apply to taxable
years beginning after December 31, 2009.</text>
</subsection></section><section display-inline="no-display-inline" id="H5D7C9ECD388E400C9EB33D312D790ABB" section-type="subsequent-section"><enum>522.</enum><header>Nonrecourse small
business investment company loans from the Small Business Administration
treated as amounts at risk</header>
<subsection id="H5998A72018194CCBBFC675AE09221A36"><enum>(a)</enum><header>In
general</header><text display-inline="yes-display-inline">Subparagraph (B) of
<external-xref legal-doc="usc" parsable-cite="usc/26/465">section
465(b)(6)</external-xref> is amended to read as follows:</text>
<quoted-block display-inline="no-display-inline" id="H6FB83A9B8CA34F8982EDBA31A1DB6946" style="OLC">
<subparagraph id="H7EAA19A131504A91BB5D1CDBC63C1691"><enum>(B)</enum><header>Qualified
nonrecourse financing</header><text display-inline="yes-display-inline">For
purposes of this paragraph—</text>
<clause id="H175EFC17293447929C690413E425F976"><enum>(i)</enum><header>In
general</header><text>The term <term>qualified nonrecourse financing</term>
means any financing—</text>
<subclause id="HA34A6B98FAFC422AB31E56A0CC8751C2"><enum>(I)</enum><text>which is qualified
real property financing or qualified SBIC financing,</text>
</subclause><subclause id="HE8980565CDEF4D28BD6B7C2DDD833F1B"><enum>(II)</enum><text>except to the
extent provided in regulations, with respect to which no person is personally
liable for repayment, and</text>
</subclause><subclause id="H48F236992306426A9A50FDC95DF2EF5C"><enum>(III)</enum><text>which is not
convertible debt.</text>
</subclause></clause><clause id="H78FBE55BA98843AE9D2E779CA72B9D91"><enum>(ii)</enum><header>Qualified real
property financing</header><text>The term <term>qualified real property
financing</term> means any financing which—</text>
<subclause id="H0AE17A255F4B4714B395CD63275FED3C"><enum>(I)</enum><text display-inline="yes-display-inline">is borrowed by the taxpayer with respect to
the activity of holding real property,</text>
</subclause><subclause id="H6CD0EA62D59D49EAA106DD9767EBBFCF"><enum>(II)</enum><text>is secured by
real property used in such activity, and</text>
</subclause><subclause id="H9F448F4F7CD046E1B0EE88C5C68CA5E6"><enum>(III)</enum><text display-inline="yes-display-inline">is borrowed by the taxpayer from a
qualified person or represents a loan from any Federal, State, or local
government or instrumentality thereof, or is guaranteed by any Federal, State,
or local government.</text>
</subclause></clause><clause id="HA3E0603F8D8548B3BB1A94201493562B"><enum>(iii)</enum><header>Qualified SBIC
financing</header><text>The term <term>qualified SBIC financing</term> means
any financing which—</text>
<subclause id="HD4F8E68AF94C4F139C8CFEA304341C46"><enum>(I)</enum><text>is borrowed by a
small business investment company (within the meaning of section 301 of the
Small Business Investment Act of 1958), and</text>
</subclause><subclause id="HD50B40509C344ED383659636A2742FFE"><enum>(II)</enum><text>is borrowed from,
or guaranteed by, the Small Business Administration under the authority of
section 303(b) of such
Act.</text>
</subclause></clause></subparagraph><after-quoted-block>.</after-quoted-block></quoted-block>
</subsection><subsection id="H76AEFF2326634CF99D5A0F805018D50A"><enum>(b)</enum><header>Conforming
amendments</header><text>Subparagraph (A) of
<external-xref legal-doc="usc" parsable-cite="usc/26/465">section
465(b)(6)</external-xref> is amended—</text>
<paragraph id="HD88414ECF33149C19B58532737E34803"><enum>(1)</enum><text>by striking
<quote>in the case of an activity of holding real property,</quote>; and</text>
</paragraph><paragraph id="H3E1133C54C2D45B086AF9D3386A8E148"><enum>(2)</enum><text>by striking
<quote>which is secured by real property used in such activity</quote>.</text>
</paragraph></subsection><subsection id="H28495F3BC11B44708C45F328C7A9A543"><enum>(c)</enum><header>Effective
date</header><text>The amendments made by this section shall apply to loans and
guarantees made after the date of the enactment of this Act.</text>
</subsection></section><section display-inline="no-display-inline" id="H43613022EE7F4D54B47562021C98BB63" section-type="subsequent-section"><enum>523.</enum><header>Benefits under the
Small Business Borrower Assistance Program excluded from gross income</header>
<subsection id="H83BDF68A00004873A13E92BB4A29D70E"><enum>(a)</enum><header>In
general</header><text display-inline="yes-display-inline">Part III of
subchapter B of
<external-xref legal-doc="usc-chapter" parsable-cite="usc-chapter/26/1">chapter
1</external-xref> is amended by adding at the end the following new
section:</text>
<quoted-block display-inline="no-display-inline" id="H00D99AA37E7E42A092479A790346728F" style="OLC">
<section id="H1C0228B9B09B4FC3A0F9C655E0691B78"><enum>139F.</enum><header>Benefits under
the Small Business Borrower Assistance Program</header>
<subsection id="H9D75D242AA5449139737F04B8532768C"><enum>(a)</enum><header>In
general</header><text display-inline="yes-display-inline">Gross income shall
not include any amount paid on behalf of a borrower by the Administrator of the
Small Business Administration under the Small Business Borrower Assistance
program established under section 402 of the Small Business Assistance Fund Act
of 2010 (as in effect immediately after the date of the enactment of such
Act).</text>
</subsection><subsection id="H3ED90DDB73F74B228A6435FD77F01486"><enum>(b)</enum><header>Denial of double
benefit</header><text display-inline="yes-display-inline">Notwithstanding any
other provision of this subtitle, with respect to the person for whose benefit
a payment described in subsection (a) is made—</text>
<paragraph id="H8E0F4BB105CF46F8A9A44D7B4247389F"><enum>(1)</enum><header>Interest</header><text>No
deduction shall be allowed for interest to the extent the liability for such
interest is covered by such payment.</text>
</paragraph><paragraph id="H598C8EBEBB384B8E850B40EA1DE46061"><enum>(2)</enum><header>Payments of
principal</header><text>If any payment is applied to reduce the principal of
the loan to which such payment relates—</text>
<subparagraph id="H63B81063141549068E682D5EEAA27762"><enum>(A)</enum><header>Allocation among
financed expenditures</header><text>Such payment shall be allocated pro rata
among the expenditures financed with such loan.</text>
</subparagraph><subparagraph id="H15BBE94ED4B94FA782227E99E486F266"><enum>(B)</enum><header>Credits and
deductible expenses</header><text>No deduction or credit shall be allowed for,
or by reason of, any such expenditure to the extent of the amount of the
payment allocated to such expenditure under subparagraph (A).</text>
</subparagraph><subparagraph id="H8A65B42A5EF84A49A2FB8B7C46EDF7EC"><enum>(C)</enum><header>Adjustment of
basis</header><text>The adjusted basis of any property acquired with such
expenditure shall be reduced to the extent of the amount of the payment
allocated to such expenditure under subparagraph
(A).</text>
</subparagraph></paragraph></subsection></section><after-quoted-block>.</after-quoted-block></quoted-block>
</subsection><subsection id="HA23829BC04C14E1FA63592A88E603345"><enum>(b)</enum><header>Clerical
amendments</header><text display-inline="yes-display-inline">The table of
sections for part III of subchapter B of
<external-xref legal-doc="usc-chapter" parsable-cite="usc-chapter/26/1">chapter
1</external-xref> is amended by adding at the end the following new
item:</text>
<quoted-block display-inline="no-display-inline" id="H826543E7C31A496FA54C943AFCCFE4F3" style="OLC">
<toc container-level="quoted-block-container" idref="H00D99AA37E7E42A092479A790346728F" lowest-bolded-level="division-lowest-bolded" lowest-level="section" quoted-block="no-quoted-block" regeneration="yes-regeneration">
<toc-entry idref="H1C0228B9B09B4FC3A0F9C655E0691B78" level="section">Sec. 139F. Benefits under the Small Business Borrower
Assistance
Program.</toc-entry>
</toc>
<after-quoted-block>.</after-quoted-block></quoted-block>
</subsection><subsection id="HB1E38AD6DE694C43BF28D11CF4CC4323"><enum>(c)</enum><header>Effective
date</header><text>The amendments made by this section shall apply to payments
made after the date of the enactment of this Act.</text>
</subsection></section></part></subtitle><subtitle id="HDE81D38FE23743FCAE763A99A38F294E"><enum>B</enum><header>Revenue
provisions</header>
<section display-inline="no-display-inline" id="H0BA849516EE44EACB98846463A56F05A" section-type="subsequent-section"><enum>531.</enum><header>Required minimum
10-year term, etc., for grantor retained annuity trusts</header>
<subsection id="HE273F856B68A4A8EBCA81B5142AA9099"><enum>(a)</enum><header>In
general</header><text display-inline="yes-display-inline">Subsection (b) of
<external-xref legal-doc="usc" parsable-cite="usc/26/2702">section
2702</external-xref> is amended—</text>
<paragraph id="HA40F556CAC0C461D9157DC7B54E83CF7"><enum>(1)</enum><text>by redesignating
paragraphs (1), (2) and (3) as subparagraphs (A), (B), and (C), respectively,
and by moving such subparagraphs (as so redesignated) 2 ems to the
right;</text>
</paragraph><paragraph id="HADD77288CF704046841ED73F4F490B69"><enum>(2)</enum><text>by striking
<quote>For purposes of</quote> and inserting the following:</text>
<quoted-block display-inline="no-display-inline" id="HBCA74F88C4E746B294D939F9147C6B21" style="OLC">
<paragraph id="HBAD537B3AE684F5FB50F61C5D3DD70EF"><enum>(1)</enum><header>In
general</header><text display-inline="yes-display-inline">For purposes
of</text>
</paragraph><after-quoted-block>; </after-quoted-block></quoted-block>
</paragraph><paragraph id="H2B0F11F478FF4F9782F41CF6141F4C58"><enum>(3)</enum><text>by striking
<quote>paragraph (1) or (2)</quote> in paragraph (1)(C) (as so redesignated)
and inserting <quote>subparagraph (A) or (B)</quote>; and</text>
</paragraph><paragraph id="H9925F0CC51BA4C92BDB20152EEE0DD8F"><enum>(4)</enum><text>by adding at the
end the following new paragraph:</text>
<quoted-block display-inline="no-display-inline" id="HB88FE7D10C07440DB603397C714930CD" style="OLC">
<paragraph id="H2850DA907BC441DB8F52292C34F464A0"><enum>(2)</enum><header>Additional
requirements with respect to grantor retained annuities</header><text>For
purposes of subsection (a), in the case of an interest described in paragraph
(1)(A) (determined without regard to this paragraph) which is retained by the
transferor, such interest shall be treated as described in such paragraph only
if—</text>
<subparagraph id="HD1901762F38442D2B53F803C1E6115EF"><enum>(A)</enum><text>the right to
receive the fixed amounts referred to in such paragraph is for a term of not
less than 10 years,</text>
</subparagraph><subparagraph id="H5C8C96920DB345369C4DDC736131089D"><enum>(B)</enum><text>such fixed
amounts, when determined on an annual basis, do not decrease relative to any
prior year during the first 10 years of the term referred to in subparagraph
(A), and</text>
</subparagraph><subparagraph id="H8EEBFAF52F704AF996B42609DFFFCEFD"><enum>(C)</enum><text>the remainder
interest has a value greater than zero determined as of the time of the
transfer.</text>
</subparagraph></paragraph><after-quoted-block>.</after-quoted-block></quoted-block>
</paragraph></subsection><subsection id="HDA87FDF298664032A9B27E33611A436A"><enum>(b)</enum><header>Effective
date</header><text>The amendments made by this section shall apply to transfers
made after the date of the enactment of this Act.</text>
</subsection></section><section display-inline="no-display-inline" id="H257019D000DF4E7281E54CEF4AF19B35" section-type="subsequent-section"><enum>532.</enum><header>Crude tall oil
ineligible for cellulosic biofuel producer credit</header>
<subsection id="H1F55B8FF1A514C298D68547701850312"><enum>(a)</enum><header>In
general</header><text display-inline="yes-display-inline">Clause (iii) of
<external-xref legal-doc="usc" parsable-cite="usc/26/40">section
40(b)(6)(E)</external-xref> is amended—</text>
<paragraph id="H75AC311185534316B80B28D951FAE90B"><enum>(1)</enum><text>by striking
<quote>or</quote> at the end of subclause (I),</text>
</paragraph><paragraph id="H238354993A874D45A787F09C3DA38DED"><enum>(2)</enum><text>by striking the
period at the end of subclause (II) and inserting <quote>, or</quote>,</text>
</paragraph><paragraph id="H30FAD787DFA143259CC9C84361E7999C"><enum>(3)</enum><text>by adding at the
end the following new subclause:</text>
<quoted-block display-inline="no-display-inline" id="HD6B307EA7868478183662550D76BBBBB" style="OLC">
<subclause id="H5842C77B2D9A4A20B204A51916AD96D6"><enum>(III)</enum><text display-inline="yes-display-inline">such fuel has an acid number greater than
25.</text>
</subclause><after-quoted-block>,
and</after-quoted-block></quoted-block>
</paragraph><paragraph id="H5DE5479A5492490F82CACC7A6050E81D"><enum>(4)</enum><text>by striking
<quote><header-in-text level="clause" style="OLC">unprocessed</header-in-text></quote> in the heading and inserting
<quote><header-in-text level="clause" style="OLC">certain</header-in-text></quote>.</text>
</paragraph></subsection><subsection id="HE6A9B374897B4C0EBDFFE6143F8284B4"><enum>(b)</enum><header>Effective
date</header><text>The amendment made by this section shall apply to fuels sold
or used on or after January 1, 2010.</text>
</subsection></section><section display-inline="no-display-inline" id="HAE9D501873FF48EE95E65D2D2EA14015" section-type="subsequent-section"><enum>533.</enum><header>Time for payment of
corporate estimated taxes</header><text display-inline="no-display-inline">The
percentage under paragraph (2) of section 561 of the Hiring Incentives to
Restore Employment Act in effect on the date of the enactment of this Act is
increased by 7.75 percentage points.</text>
</section></subtitle><enum>VI</enum><header>Plain Writing
Act</header>
<section id="H4504AC6716A14FC1A4B45DE8255A7D9F"><enum>601.</enum><header>Short
title</header><text display-inline="no-display-inline">This title may be cited
as the <quote><short-title>Plain Writing Act of
2010</short-title></quote>.</text>
</section><section id="H01ACC40FEAC04095943D51405D4903E7"><enum>602.</enum><header>Purpose</header><text display-inline="no-display-inline">The purpose of this title is to improve the
effectiveness and accountability of Federal agencies to the public by promoting
clear Government communication that the public can understand and use.</text>
</section><section id="H69E980F42EC4427DB5C53FFEBE7E147E"><enum>603.</enum><header>Definitions</header><text display-inline="no-display-inline">In this title:</text>
<paragraph id="HB61DCB30CFA646F09674C6C861903C4C"><enum>(1)</enum><header>Agency</header><text>The
term <quote>agency</quote> means the Department of the Treasury and the Small
Business Administration.</text>
</paragraph><paragraph id="HD406B856925A454B8E1A716A0210CB71"><enum>(2)</enum><header>Covered
document</header><text>The term <quote>covered document</quote>—</text>
<subparagraph id="H6E6C0E302C1B40E4BE2E0816C23D1043"><enum>(A)</enum><text>means any document
that—</text>
<clause id="HF398E5A2526D403E82F2946B1B304B7D"><enum>(i)</enum><text>is
relevant to obtaining any Federal Government benefit or service provided under
title I, II, or III;</text>
</clause><clause id="H3C96FAFBFC2D416A9B7C7694AF972DE8"><enum>(ii)</enum><text display-inline="yes-display-inline">provides information about any Federal
Government benefit or service provided under title I, II, or III; or</text>
</clause><clause id="HA625128A863B4FE2A5370BFF845560FD"><enum>(iii)</enum><text display-inline="yes-display-inline">explains to the public how to comply with a
requirement the Federal Government administers or enforces under title I, II,
or III;</text>
</clause></subparagraph><subparagraph id="H7284BE79D6884C9AA948A6B8D0903C8A"><enum>(B)</enum><text>includes (whether
in paper or electronic form) a letter, publication, form, notice, or
instruction; and</text>
</subparagraph><subparagraph id="H9677154880DD4F06A808B5A7CCFCEFD2"><enum>(C)</enum><text>does not include a
regulation.</text>
</subparagraph></paragraph><paragraph id="H5692D306C18544DCADF7926028138CA4"><enum>(3)</enum><header>Plain
writing</header><text>The term <quote>plain writing</quote> means writing that
the intended audience can readily understand and use because that writing is
clear, concise, well-organized, and follows other best practices of plain
writing.</text>
</paragraph></section><section id="HF3AC6E930B7249F8B8D3AFBEB3EBD096"><enum>604.</enum><header>Responsibilities
of Federal agencies</header>
<subsection id="HD55418CE070D48DC8BE2E8B7EC9B00FD"><enum>(a)</enum><header>Preparation for
Implementation of Plain Writing Requirements</header>
<paragraph id="H08F46B872AFE496293AE0D117EBAAF81"><enum>(1)</enum><header>In
general</header><text>Not later than 9 months after the date of enactment of
this title, the head of each agency shall—</text>
<subparagraph id="H38DE7635AB1047F383C1A1DBA1771F40"><enum>(A)</enum><text>designate 1 or
more senior officials within the agency to oversee the agency implementation of
this title;</text>
</subparagraph><subparagraph id="HAE99389B4A3E4F3481C8E22C560D0EDC"><enum>(B)</enum><text>communicate the
requirements of this title to the employees of the agency;</text>
</subparagraph><subparagraph id="H0F2A6922C39D4816AF0BCFC93FD84A23"><enum>(C)</enum><text>train employees of
the agency in plain writing;</text>
</subparagraph><subparagraph id="HD7BCF37B6E764D95B42C9C3FF7E77B97"><enum>(D)</enum><text>establish a
process for overseeing the ongoing compliance of the agency with the
requirements of this title;</text>
</subparagraph><subparagraph id="HB815FF9EDE2E415DB9D1EEF3AF16448A"><enum>(E)</enum><text>create and
maintain a plain writing section of the agency’s website that is accessible
from the homepage of the agency’s website; and</text>
</subparagraph><subparagraph id="H33333A1202AB4D7C93C891D9D898C203"><enum>(F)</enum><text>designate 1 or
more agency points-of-contact to receive and respond to public input on—</text>
<clause id="H383DE7C5DDFC4A818C48A44BC9323D4C"><enum>(i)</enum><text>agency
implementation of this title; and</text>
</clause><clause id="H7EEE8CCA80D442539367361EFD584385"><enum>(ii)</enum><text>the
agency reports required under section 605.</text>
</clause></subparagraph></paragraph><paragraph id="H07C3AA9D945B46718B590033915AC664"><enum>(2)</enum><header>Website</header><text>The
plain writing section described under paragraph (1)(E) shall—</text>
<subparagraph id="H8ADB3E6E4E4C4B17AFD09C627DF01AFD"><enum>(A)</enum><text>inform the public
of agency compliance with the requirements of this title; and</text>
</subparagraph><subparagraph id="H839854CF6B6448C5A10DAF275900767A"><enum>(B)</enum><text>provide a
mechanism for the agency to receive and respond to public input on—</text>
<clause id="HAE3171B996D94A0E812E640D745DE266"><enum>(i)</enum><text>agency
implementation of this title; and</text>
</clause><clause id="H4B7D5C2533764409A0EFCDF7C299508C"><enum>(ii)</enum><text>the
agency reports required under section 605.</text>
</clause></subparagraph></paragraph></subsection><subsection id="H4B400E074CD04A9EB85739D1A7B68061"><enum>(b)</enum><header>Requirement to
use plain writing in new documents</header><text>Beginning not later than 1
year after the date of enactment of this title, each agency shall use plain
writing in every covered document of the agency that the agency issues or
substantially revises.</text>
</subsection><subsection id="H30260E50A0CD47F18E6129F90F444FF7"><enum>(c)</enum><header>Guidance</header><text>In
carrying out the provisions of this title, agencies may follow the guidance
of—</text>
<paragraph id="H8B5BA42B197A48AEBDA4070BC51B363D"><enum>(1)</enum><text>the writing
guidelines developed by the Plain Language Action and Information Network;
or</text>
</paragraph><paragraph id="H208A46F0DF894ABEABAC6C381B2DE9C0"><enum>(2)</enum><text>guidance provided
by the head of the agency.</text>
</paragraph></subsection></section><section id="H96DF2BCCDCCE4A34BA96043DB72A9875"><enum>605.</enum><header>Reports to
Congress</header>
<subsection id="HE18DD75B3C28428EBD3497A9598EAC8C"><enum>(a)</enum><header>Initial
report</header><text>Not later than 9 months after the date of enactment of
this title, the head of each agency shall publish on the plain writing section
of the agency’s website a report that describes the agency plan for compliance
with the requirements of this title.</text>
</subsection><subsection id="H7D396F0A361646648F03FA9DACF05183"><enum>(b)</enum><header>Annual
compliance report</header><text>Not later than 18 months after the date of
enactment of this title, and annually thereafter, the head of each agency shall
publish on the plain writing section of the agency’s website a report on agency
compliance with the requirements of this title.</text>
</subsection></section><enum>VII</enum><header>Sense of
Congress on agriculture and farming small business loans</header>
<section id="H2C8E10F3A8074B6291310E7C29117651"><enum>701.</enum><header>Sense of
Congress</header><text display-inline="no-display-inline">It is the sense of
the Congress that—</text>
<paragraph id="HEBCD5A0DB745468D9D72823CD4E7D026"><enum>(1)</enum><text display-inline="yes-display-inline">agriculture operations, farms, and rural
communities should receive equal consideration through lending activities for
small businesses in this Act, particularly small- and mid-size farms and
agriculture operations; and</text>
</paragraph><paragraph id="HF0998A9425AE4399926D44E3E0BEEC25"><enum>(2)</enum><text>attention should
be given to ensuring there is adequate small business credit and financing
availability under this Act in the agriculture and farming sectors.</text>
</paragraph></section><enum>VIII</enum><header>Small Business
Borrower Assistance Program</header>
<section id="HBC304902EFDA442ABC6ECF15D55DDCB6"><enum>801.</enum><header>Short
title</header><text display-inline="no-display-inline">This title may be cited
as the <quote>Small Business Assistance Fund Act of 2010</quote>.</text>
</section><section id="HDA492685B9AC4111A34E0EEEC67E89E0"><enum>802.</enum><header>Small Business
Borrower Assistance Program</header>
<subsection id="H8F536975A0C14842848EC03F70259069"><enum>(a)</enum><header>In
general</header><text display-inline="yes-display-inline">The Administrator
shall carry out a program to be called the <quote>Small Business Borrower
Assistance Program</quote> to provide payments of principal and interest on
qualifying small business loans.</text>
</subsection><subsection id="H13B9AE4321CD4C22884540620969E70A"><enum>(b)</enum><header>Automatic
enrollment; Commitment of funds</header>
<paragraph id="H0762045E4E4741D2AA33CA43C49C0442"><enum>(1)</enum><header>In
general</header><text>To the extent funds are available under the Program, each
borrower that receives a qualifying small business loan after the date on which
the Administrator issues regulations pursuant to subsection (e) shall be
automatically enrolled in the Program, unless the borrower requests otherwise,
and the Administrator shall commit an amount to each borrower equal to 6
percent of the principal disbursed amount of such borrower’s qualifying small
business loan.</text>
</paragraph><paragraph id="H823BE3A546A24AFEB7EA533AC041568C"><enum>(2)</enum><header>One year window
for participating in Program</header><text display-inline="yes-display-inline">Notwithstanding paragraph (1), a borrower
may only be enrolled in the Program if the borrower is approved for a
qualifying small business loan before the end of the 1-year period following
the date on which the Administrator issues final regulations pursuant to
subsection (e).</text>
</paragraph><paragraph id="HE4698080747942A3A513F26A24051281"><enum>(3)</enum><header>Termination of
participation in certain circumstances</header><text>In any instance in which
the Administrator determines that a borrower participating in the Program has
committed fraud or made a material misrepresentation related to such
participation, the Administrator may terminate such borrower’s participation in
the Program and ban such borrower from any future participation in the
Program.</text>
</paragraph></subsection><subsection id="HCFFD76A6C56A43F498A4AF866D3B4435"><enum>(c)</enum><header>Disbursement of
funds</header>
<paragraph id="H9E5749E2B6EC4E43A6C16E52563436F1"><enum>(1)</enum><header>In
general</header><text display-inline="yes-display-inline">A borrower enrolled
in the Program may submit a request for the payment of committed funds by a
method to be developed by the Administrator.</text>
</paragraph><paragraph id="HB396349B7B174AD1A97D9365188B6DDD"><enum>(2)</enum><header>Multiple
disbursements permitted</header><text>A borrower enrolled in the Program may
request multiple payments under paragraph (1), as long as the aggregate amount
of such payments does not exceed the amount committed to such borrower under
subsection (b).</text>
</paragraph></subsection><subsection id="H1D6D3BAAE7E14064AC0D7B023A097223"><enum>(d)</enum><header>Terms</header>
<paragraph id="HE9EC24EF8F94436DB1A5FA96714E7F1C"><enum>(1)</enum><header>Payments only to
lender or servicer</header><text display-inline="yes-display-inline">Payments
made by the Administrator under the Program shall only be made to the lender or
servicer of a qualifying small business loan to be applied against outstanding
principal or interest, and may not be made to the borrower.</text>
</paragraph><paragraph id="H9CBFBEAC321448008C070FD5AB15DB9C"><enum>(2)</enum><header>Program
participation only permitted during first 2 years</header>
<subparagraph id="H8BA462E7A7F145C28695B5FB10D9F09C"><enum>(A)</enum><header>In
general</header><text>Payments made by the Administrator under the Program may
only be made with respect to a payment of interest or principal due on a
qualifying small business loan within the 2-year period following the date on
which such loan is disbursed.</text>
</subparagraph><subparagraph id="H837C26A353564C119BAE124C50B003F0"><enum>(B)</enum><header>Unexpended
committed funds</header>
<clause id="H123F2879411E4159B1A1D4B8295E70BB"><enum>(i)</enum><header>In
general</header><text display-inline="yes-display-inline">With respect to any
funds committed to a borrower enrolled in the Program that remain unexpended at
the end of the 2-year period described under subparagraph (A), such funds shall
be paid to the lender or servicer of the borrower’s loan and applied to the
principal of such loan.</text>
</clause><clause id="HA5F66E0C684F43EF92B0F8740F113849"><enum>(ii)</enum><header>Exception</header><text>In
any case in which the amount of committed funds that remain unexpended is
greater than the remaining principal of a borrower’s loan, the amount of any
excess shall be returned to the Treasury.</text>
</clause></subparagraph></paragraph></subsection><subsection id="HCB69C8DD7D3F49FC8FCE09655941FA03"><enum>(e)</enum><header>Rulemaking</header><text>Not
later than 180 days after the date of the enactment of this section, the
Administrator shall issue regulations necessary to carry out this
section.</text>
</subsection><subsection id="HB8657B3886E64FAB864DA85D8561B358"><enum>(f)</enum><header>Contracting with
agents</header><text display-inline="yes-display-inline">The Administrator may
contract with one or more entities as necessary to carry out the provisions of
the Program. The Secretary of the Treasury is authorized to designate financial
institutions, including any bank, savings association, or trust company, as
financial agents of the Federal Government to carry out the authorities of this
section, and such institutions shall perform all such reasonable duties related
to the Program as financial agents of the Federal Government as the Secretary
may require. In engaging any such third parties to carry out the Program, the
Administrator or the Secretary shall seek to involve small businesses in the
provision of the core direct services required under the engagement.</text>
</subsection><subsection id="H619CFECC5A724875A9EB6D14A6F4EE05"><enum>(g)</enum><header>Definitions</header><text>For
purposes of this section:</text>
<paragraph id="HA1B2AF47837A47BD83BC3A47DD36A712"><enum>(1)</enum><header>Administrator</header><text>The
term <quote>Administrator</quote> means the Administrator of the Small Business
Administration.</text>
</paragraph><paragraph id="HD85C2085FCA64BBC80F341CD0263C209"><enum>(2)</enum><header>Program</header><text display-inline="yes-display-inline">The term <quote>Program</quote> means the
Small Business Borrower Assistance Program established under subsection
(a).</text>
</paragraph><paragraph id="H9652881CE3EF483783384492E384E887"><enum>(3)</enum><header>Qualifying small
business loan</header><text display-inline="yes-display-inline">The term
<quote>qualifying small business loan</quote> means any loan, up to $300,000,
made to a small business concern and guaranteed under 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>), other than a loan made pursuant to section
7(a)(31) of such Act, a revolving credit line, or any other revolving
loan.</text>
</paragraph><paragraph id="HAFFFBD72B57C4630B66968BBCA93E7C6"><enum>(4)</enum><header>Small business
concern</header><text>The term <quote>small business concern</quote> has the
meaning given such term under section 3 of the Small Business Act
(<external-xref legal-doc="usc" parsable-cite="usc/15/632">15 U.S.C.
632</external-xref>).</text>
</paragraph></subsection><subsection display-inline="no-display-inline" id="H1528D52FAED745E1AD3B4C96FA665347"><enum>(h)</enum><header>Authorization of
appropriations</header><text display-inline="yes-display-inline">There is
hereby authorized to be appropriated to the Administrator $300,000,000 to carry
out this section.</text>
</subsection></section>
Passed the House of
Representatives June 17, 2010.
Lorraine C. Miller,
Clerk.
June 21, 2010
Read the second time and placed on the
calendar