[Congressional Bills 111th Congress]
[From the U.S. Government Publishing Office]
[S. 3835 Introduced in Senate (IS)]

111th CONGRESS
  2d Session
                                S. 3835

 To reinstate the increase in the surety bond guarantee limits for the 
                     Small Business Administration.


_______________________________________________________________________


                   IN THE SENATE OF THE UNITED STATES

                           September 23, 2010

 Mr. Cardin (for himself, Ms. Landrieu, and Mr. Baucus) introduced the 
 following bill; which was read twice and referred to the Committee on 
                  Small Business and Entrepreneurship

_______________________________________________________________________

                                 A BILL


 
 To reinstate the increase in the surety bond guarantee limits for the 
                     Small Business Administration.

    Be it enacted by the Senate and House of Representatives of the 
United States of America in Congress assembled,

SECTION 1. SURETY BONDS.

    (a) Maximum Bond Amount.--Section 411(a)(1) of the Small Business 
Investment Act of 1958 (15 U.S.C. 694b(a)(1)) is amended by striking 
``(1)'' and all that follows and inserting the following: ``(1)(A) The 
Administration may, upon such terms and conditions as it may prescribe, 
guarantee and enter into commitments to guarantee any surety against 
loss resulting from a breach of the terms of a bid bond, payment bond, 
performance bond, or bonds ancillary thereto, by a principal on any 
total work order or contract amount at the time of bond execution that 
does not exceed $5,000,000.
    ``(B) The Administrator may guarantee a surety under subparagraph 
(A) for a total work order or contract amount that does not exceed 
$10,000,000, if a contracting officer of a Federal agency certifies 
that such a guarantee is necessary.''.
    (b) Denial of Liability.--Section 411 of the Small Business 
Investment Act of 1958 (15 U.S.C. 694b) is amended--
            (1) by striking subsection (e) and inserting the following:
    ``(e) Reimbursement of Surety; Conditions.--Pursuant to any such 
guarantee or agreement, the Administration shall reimburse the surety, 
as provided in subsection (c) of this section, except that the 
Administration shall be relieved of liability (in whole or in part 
within the discretion of the Administration) if--
            ``(1) the surety obtained such guarantee or agreement, or 
        applied for such reimbursement, by fraud or material 
        misrepresentation;
            ``(2) the total contract amount at the time of execution of 
        the bond or bonds exceeds $5,000,000;
            ``(3) the surety has breached a material term or condition 
        of such guarantee agreement; or
            ``(4) the surety has substantially violated the regulations 
        promulgated by the Administration pursuant to subsection 
        (d).'';
            (2) by striking subsection (k); and
            (3) by adding after subsection (i) the following:
    ``(j) Denial of Liability.--For bonds made or executed with the 
prior approval of the Administration, the Administration shall not deny 
liability to a surety based upon material information that was provided 
as part of the guaranty application.''.
    (c) Size Standards.--Section 410 of the Small Business Investment 
Act of 1958 (15 U.S.C. 694a) is amended--
            (1) by striking paragraph (9); and
            (2) adding after paragraph (8) the following:
    ``(9) Notwithstanding any other provision of law or any rule, 
regulation, or order of the Administration, for purposes of sections 
410, 411, and 412 the term `small business concern' means a business 
concern that meets the size standard for the primary industry in which 
such business concern, and the affiliates of such business concern, is 
engaged, as determined by the Administrator in accordance with the 
North American Industry Classification System.''.
    (d) Conforming Amendment.--Section 508(f) of division A of the 
American Recovery and Reinvestment Act of 2009 (15 U.S.C. 694a note) is 
repealed.
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