[Congressional Bills 119th Congress]
[From the U.S. Government Publishing Office]
[H.R. 10375 Introduced in House (IH)]
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119th CONGRESS
2d Session
H. R. 10375
To amend the Small Business Investment Act of 1958 to improve the loan
guaranty program, enhance the ability of small manufacturers to access
affordable capital, and for other purposes.
_______________________________________________________________________
IN THE HOUSE OF REPRESENTATIVES
September 14, 2026
Ms. Velazquez (for herself and Mr. Williams of Texas) introduced the
following bill; which was referred to the Committee on Small Business
_______________________________________________________________________
A BILL
To amend the Small Business Investment Act of 1958 to improve the loan
guaranty program, enhance the ability of small manufacturers to access
affordable capital, and for other purposes.
Be it enacted by the Senate and House of Representatives of the
United States of America in Congress assembled,
SECTION 1. SHORT TITLE.
This Act may be cited as the ``504 Modernization and Small
Manufacturer Enhancement Act of 2026''.
SEC. 2. ADDITIONS TO POLICY GOALS FOR THE DEVELOPMENT COMPANY PROGRAM.
Section 501(d)(3) of the Small Business Investment Act of 1958 (15
U.S.C. 695(d)(3)) is amended--
(1) by redesignating subparagraphs (A) through (L) as
subparagraphs (B) through (M), respectively;
(2) by inserting before subparagraph (B), as so
redesignated, the following:
``(A) workforce development through work-based or
work-integrated training, which shall be satisfied by
demonstrating that a small business concern that is a
subject of the project has--
``(i) a documented in-house training
program, the duration of which is not shorter
than 12 weeks; or
``(ii) entered into a contract with an
entity--
``(I) to provide trained applicants
for any open position of employment at
the small business concern; and
``(II) that ensures that any
applicant provided to the small
business concern under subclause (I)
has undergone not fewer than 12 weeks
of training that is relevant to the
open position described in that
subclause,'';
(3) in subparagraph (L), as so redesignated, by striking
``producers, or'' and inserting ``producers,'';
(4) in subparagraph (M), as so redesignated, by striking
the period at the end and inserting a comma;
(5) by inserting after subparagraph (M), as so
redesignated, the following:
``(N) aid revitalizing of an area for which a
disaster has been declared or determined under
subparagraph (A), (B), (C), or (E) of section 7(b)(2)
of the Small Business Act (15 U.S.C. 636(b)(2)) during
the five-year period beginning on the date on which the
disaster was declared or determined under such
subparagraph, except that the Administrator may extend
such period if, for each extension of such period, the
Administrator determines that such extension will
facilitate the recovery of such area from such disaster
and such extension is for a period of one year, or
``(O) expansion of small business concerns with 10
or fewer employees.''; and
(6) in the flush text following subparagraph (O), as added
by paragraph (5), by striking ``subparagraphs (J) and (K)'' and
inserting ``subparagraphs (K) and (L)''.
SEC. 3. IMPROVEMENTS TO 504 LOAN CLOSING PROCEDURE.
Title V of the Small Business Investment Act of 1958 (15 U.S.C. 695
et seq.) is amended--
(1) in section 502 (15 U.S.C. 696), by adding at the end
the following:
``(8) Closing.--An accredited lender certified company may
take any of the following actions to facilitate the closing of
a loan made under this section:
``(A) Reallocate the cost of the project with
respect to which the loan is made in an amount that is
not more than 10 percent of the overall cost of the
project.
``(B) Make typographical corrections to any name
that is applicable to the loan, including the name of
any borrower, guarantor, eligible passive company
described in subparagraph (C)(i), and operating company
described in subparagraph (C)(i).
``(C) Add any of the following to receive proceeds
of the loan:
``(i) An eligible passive company, as
defined by the Administrator.
``(ii) If an eligible passive company is
added under clause (i), an operating company
with respect to that eligible passive company.
``(D) Make typographical corrections to the address
of any property with respect to which the loan is made.
``(E) Make typographical corrections to the name of
any interim lender, third-party lender, or provider of
funds described in subclause (I), (II), or (III) of
section 502(3)(B)(i).
``(F) Make a guarantor a co-borrower or a co-
borrower a guarantor.
``(G) Add a guarantor that does not have any
ownership interest in the business seeking financing or
project being financed under this section.
``(H) Reduce the amount of debt owed by the
borrower before the closing as a result of regularly
scheduled payments.
``(I) Reduce the cost of the project with respect
to which the loan is made.
``(9) Accredited lender certified company defined.--In this
section, the term `accredited lender certified company' means a
certified development company that the Administration has
designated as an accredited lender under such section
507(b).''; and
(2) by adding at the end the following:
``SEC. 511. CLOSING AND OVERSIGHT.
``(a) SBA District Counsels.--Beginning on the date that is 180
days after the date of enactment of this section, with respect to the
program established under this title, district counsels of the
Administration shall be subject to the same requirements, and shall
have the same authority and responsibilities, as in effect with respect
to that program on the day before the date of enactment of this
section, except that--
``(1) the Office of Credit Risk Management of the
Administration shall have the responsibility for all duties
relating to conducting file reviews of loans reviewed and
closed by a designated attorney under this title; and
``(2) district counsels of the Administration shall not
have any responsibility relating to the review of closing
packages with respect to a loan reviewed and closed by a
designated attorney under this title.
``(b) Designated Attorneys.--For the purposes of this title, the
following definitions and requirements shall apply with respect to a
designated attorney of a Priority certified development company:
``(1) The term `designated attorney' means a certified
development company attorney that the Administrator has
approved to close loans for a Priority certified development
company.
``(2) The term `Priority certified development company'
means a certified development company certified to participate
on a permanent basis in the program to provide financings
established under this title and that the Administrator has
approved to participate in an expedited loan and debenture
closing process.
``(3) A designated attorney shall be responsible for
certifying documents relating to the closing of a loan made
under this title if such designated attorney submits to the
Administrator evidence that such designated attorney--
``(A) is licensed and in good standing to practice
law in the State in which such loan is being closed;
``(B) has professional malpractice insurance
coverage; and
``(C) has attended a training course on closing
loans made under this title that is approved by the
Administration.''.
SEC. 4. SBA MARKETING AND OUTREACH.
(a) In General.--Title V of the Small Business Investment Act of
1958 (15 U.S.C. 695 et seq.), as amended by this Act, is further
amended by adding at the end the following:
``SEC. 512. SBA MARKETING AND OUTREACH.
``The Administrator shall develop and implement a marketing and
outreach plan with respect to the availability of loans available under
this title and may partner with 1 or more resource partners to
implement such plan.''.
(b) Initial Plan.--The Administrator of the Small Business
Administration shall begin implementing the plan required under section
512 of title V of the Small Business Investment Act of 1958 (15 U.S.C.
695 et seq.), as added by subsection (a), not later than 1 year after
the date of the enactment of this Act.
SEC. 5. LEASING RULES FOR NEW FACILITIES AND EXISTING BUILDINGS.
(a) In General.--Section 502 of the Small Business Investment Act
of 1958 (15 U.S.C. 696) is amended by striking paragraphs (4) and (5)
and inserting the following:
``(4) New facilities.--
``(A) In general.--With respect to a project to
construct a new facility, an assisted small business
concern may permanently lease not more than 20 percent
of the project to commercial or residential tenants if
such concern--
``(i) permanently occupies and uses not
less than 60 percent of the project;
``(ii) plans to occupy and use an
additional portion of the project that is not
permanently leased not later than 3 years after
receipt of assistance under this section; and
``(iii) plans to permanently occupy and use
80 percent of the project not later than 10
years after receipt of such assistance.
``(B) Small manufacturers.--With respect to an
assisted small business concern that is a small
manufacturer (as defined in section 501(e)(6)),
subparagraph (A)(i) shall apply with `50 percent'
substituted for `60 percent'.
``(5) Existing buildings.--With respect to a project to
acquire, renovate, or reconstruct an existing building, the
following shall apply:
``(A) Occupancy requirements.--The assisted small
business concern may permanently lease not more than 50
percent of the project if the concern permanently
occupies and uses not less than 50 percent of the
project.
``(B) Exception.--The assisted small business
concern may permanently lease more than 50 percent of
the project, but not more than 66 percent of the
project, to commercial or residential tenants if--
``(i) such concern--
``(I) has occupied and used the
existing building for a consecutive 12-
month period before submitting an
application for assistance under this
section;
``(II) agrees to permanently use
less than 50 percent of the existing
building and permanently lease more
than 50 percent for a consecutive 12-
month period after receiving such
assistance; and
``(III) affirms that the existing
building is appropriate for current and
reasonably anticipated needs; and
``(ii) the development company assisting
such project--
``(I) provides written notice to
the Administrator on the date on which
the development company closes the loan
for such project; and
``(II) once each year during the
first 5 years of the loan, and once
every 2 years for the remainder of the
loan--
``(aa) conducts an
examination of the assisted
small business concern to
ensure the concern is not a
real estate development
business; and
``(bb) files with the
Administrator an anti-investor
certification signed by the
development company and the
assisted small business
concern.
``(C) Lease term.--Any residential lease made under
this paragraph shall be for a term of not more than 1
year, and any commercial lease made under this
paragraph shall be for a term of not more than 5
years.''.
(b) Report.--Not later than 5 years after the date of enactment of
this Act, the Administrator of the Small Business Administration shall
submit to Congress a report analyzing the impact of the amendments made
by this section on access to capital for small business concerns (as
defined in section 3 of the Small Business Act (15 U.S.C. 632)).
SEC. 6. CREDIT ELSEWHERE EXEMPTION.
Section 7(a)(1)(A) of the Small Business Act (15 U.S.C.
636(a)(1)(A)) is amended--
(1) in clause (i), by striking ``The Administrator'' and
inserting ``Except as provided in clause (iii), the
Administrator''; and
(2) by adding at the end the following:
``(iii) Exemption.--Clause (i) shall not
apply to loans under paragraph (13) of this
subsection, loans or other financings under the
Small Business Investment Act of 1958 (15
U.S.C. 661 et seq.), or any other loan made by
the Administrator to a certified development
company.''.
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