[Congressional Record Volume 147, Number 161 (Tuesday, November 27, 2001)]
[Senate]
[Pages S12045-S12047]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




                   UNANIMOUS CONSENT REQUEST--S. 1499

  Mr. KERRY. Madam President, Senator Bond and I have been trying to 
bring S. 1499 before the Senate since it was introduced, but literally 
for more than 1 month steadily, we have been held up, depriving the 
Senate of an appropriate debate and depriving us of an opportunity to 
achieve maybe 90 to 95 votes for this legislation.
  I ask unanimous consent that the Senate now proceed to Calendar No. 
186, S. 1499; that the Kerry-Bond substitute amendment which is at the 
desk be considered and agreed to, and the bill, as amended, be read 
three times, passed, and that the motion to reconsider be laid upon the 
table with no intervening action or debate.
  The PRESIDING OFFICER. Is there objection?
  Mr. KYL. Madam President, I object reluctantly on my behalf and on 
behalf of other Senators. I believe both Senator Kerry and Senator Bond 
wish to speak on the issue, and I will speak to it when they have 
completed their remarks.
  The PRESIDING OFFICER. The objection is heard.
  Mr. KERRY. Madam President, I understand the Senator from Arizona has 
indeed objected to this bill for a period of time now, as I referenced 
moments ago. I regret that. We have tried to work out the issues with 
respect to what is the American Small Business Emergency Relief and 
Recovery Act of 2001. The ranking member of the Small Business and 
Entrepreneurship Committee, Senator Bond, has joined me for some period 
of time now in trying to move this important legislation for the small 
businesses of our country. We have 55 cosponsors of this bill, a 
majority of the Senate, prepared to help the small businesses of the 
country. Two United States Senators, I regret to say, oppose this bill, 
and we are not able to proceed forward.
  We have the support of the Airport Ground Transportation Association, 
the American Bus Association, the Association of Women's Business 
Centers, the CDC Small Business Finance, the Chicago Association of 
Neighborhood Development Organizations, the Citizens Financial Group of 
Rhode Island, the Clovis Community Bank of California, the Coastal 
Enterprises of Maine, the County of San Diego, the Delaware Community 
Reinvestment Act Council, the Fairness in Rural Lending Group, the 
Florida Atlantic University Small Business Development Center, the 
Helicopter Association, the National Association of Development 
Companies, the National Association of Government Guaranteed Lenders--
some 5,000-plus lenders--the National Community Reinvestment 
Association, the National League of Cities, the National Limousine 
Association, the National Restaurant Association, the National Small 
Business United, National Tour Association, the Rural Housing 
Institute, the Rural Opportunities, Small Business Legislative Council, 
the U.S. Conference of Mayors, the United States Chamber of Commerce, 
the United States Tour Operator Association, the Women's Business 
Development Center, and others.
  This amendment incorporates a number of improvements that Senator 
Bond and I have made at the recommendation of the administration and of 
other colleagues and of the business community. It seeks to provide 
help to small businesses nationwide that are struggling because of the 
events of September 11, exacerbating an already declining economy in 
the months prior to September 11.
  They need access to working capital until normal operations resume, 
or until they can restructure or change the business to address the 
market changes. Many small businesses simply cannot find the working 
capital they need, even though they are a viable business under normal 
circumstances, because of this momentary downturn, because of an abrupt 
cutoff of business due to the reduction in auto rentals, hotel rentals, 
visits to restaurants, travel and therefore business with travel 
agencies. All of those immediately impacted by the events of September 
11 are living out an aberration in the economy. It is not the normal 
course of doing business. Those are businesses that could be viable in 
a matter of months, which we do not want to lose, providing in the 
normal course of business we provide them with adequate access to 
credit.
  The problem is, all across the country, we know credit has tightened 
up as a consequence of the outlook of the economy. So we create this 
self-fulfilling prophecy, this cycle of a downward trend as a 
consequence of people saying: I think the economy looks bad. . . . We 
have to hold back on those loans. . . . Consequently, they hold back on 
the loans and then, indeed, the economy looks bad because the failures 
ensue because working businesses do not get their capital.
  In American Banker, they wrote the following:

       Lenders were already skittish following the steep economic 
     decline of the past year. The events of September 11 have 
     diminished their confidence and dimmed their prospect for 
     recovery.

  This bill is geared to try to provide emergency lending completely 
within the current law and capacity of the Small Business 
Administration. It builds on SBA's disaster loans, the 7(a) working 
capital loans, the 504 loans for equipment and building improvements, 
the venture capital investments and expanded access to SBA's business 
counseling. SBA has done an extraordinary job of leveraging small 
amounts of money into larger amounts of money in the country.
  Let me point out that one of the objections of our colleagues who 
keep stopping us from proceeding forward is that this bill will cost 
money. Based on a 1992 study by Price Waterhouse, the $17 billion of 
7(a) loans authorized by this bill will yield tax revenues from the 
small businesses borrowers of about $2.5 billion in the first year 
alone, more than off-setting the cost of the entire bill.
  This bill is fiscally responsible. The Congressional Budget Office 
(CBO) has informally scored S. 1499 at $860 million if all aspects are 
fully funded and utilized. CBO has estimated that the vast majority of 
the loans provided by S. 1499 (those made under section 7(a) of the 
Small Business Act) will cost 3 percent; that means that for every $100 
loaned, the cost to the government is $3. This is a cost-effective way 
to provide necessary access to capital to small businesses throughout 
the country.
  The judgment that is made in making a loan is how assured is that 
return on investment or what is the track record of the people to whom 
you are lending. The fact is that the track record of the Small 
Business Administration over the last years has been improving steadily 
and is at a rate today that would suggest this is a positive 
undertaking for the Government of the United States. It is particularly 
important for us to engage in it. In fact, the Administrator of the SBA 
recently said at a conference that the cost of the 7(a) program will be 
50 percent less in FY 2003.
  I might point out that if one were to take a number of the businesses 
that have been helped by the Small Business Administration--and I will 
be very quick because I know my colleague from Missouri wants to 
speak--the entire budget of the SBA for several years has been paid for 
many times over by the tax revenues that have come from the success 
stories of the companies that the SBA has funded. How many of our 
colleagues are aware that SBA was involved in funding Fed Ex, SBA was 
involved in the funding of Callaway Golf, SBA was involved in the 
funding of Intel? Intel alone has returned more in terms of the tax 
revenue in this country than the entire annual budget of SBA.
  So we have many small businesses that are currently trying to stave 
off

[[Page S12046]]

bankruptcies. They are trying to prevent the doors from being closed. 
They want to keep people working, and keeping those people working is 
in itself a stimulus for the United States because those are people who 
pay their health bills, pay their mortgages, make their car payments, 
and all of that begins to restore the health of the economy in the long 
run.
  I urge my colleagues to take up this legislation in the next few 
days. Small businesses are asking Members to do this. Our friends in 
the House of Representatives, Congressman Don Manzullo, chairman of the 
committee, and Congressman Jim Moran have introduced a companion bill 
and are gearing up to pass it as soon as possible. I hope my 55 
colleagues, who are consponsors of this, and others waiting to vote for 
it, and the small businesses who need it, will be liberated from this 
hold in the Senate.
  Mr. President, I thank my 55 colleagues who are cosponsors of this 
bill, with a special thanks to Senator Bond, the ranking member of the 
Senate Committee on Small Business and Entrepreneurship. I also want to 
thank the many supporters of this legislation.
  I ask unanimous consent that the list of cosponsors and several of 
the many letters of support for the legislation be printed in the 
Record.
  There being no objection, the material was ordered to be printed in 
the Record, as follows:

 Cosponsors--The American Small Business Emergency Relief and Recovery 
                              Act of 2001

       Senators Bond, Wellstone, Harkin, Cleland, Lieberman, 
     Edwards, Carnahan, Levin, Cantwell, Landrieu, Snowe, Allen, 
     Crapo, Enzi, Burns, Ensign, Schumer, Clinton, Daschle, 
     Bingaman, Inouye, Sarbanes, Akaka, Reed, Durbin, Kennedy, 
     Grassley, Torricelli, Lincoln, Rockfeller, Hollings, Leahy, 
     Corzine, Johnson, Collins, Biden, Warner, Bill Nelson, 
     Mikulski, Jeffords, Bennett, Murray, Carper, Domenici, 
     Conrad, Smith (OR), Graham, Roberts, Stabenow, Dorgan, Hagel, 
     Hutchison, Dodd, Hutchinson, and Boxer.
                                  ____

                                        Chamber of Commerce of the


                                     United States of America,

                                 Washington, DC, October 12, 2001.
     Hon. John Kerry,
     Chairman, Small Business Committee,
     U.S. Senate, Washington, DC.
       Dear Mr. Chairman: I am writing to thank you for 
     introducing S. 1499, ``The American Small Business Emergency 
     Relief and Recover Act of 2001,'' on October 8, 2001, and 
     pledge the U.S. Chamber of Commerce's support for this 
     important bill that provides much needed relief to many of 
     America's small business owners.
       As a direct result of the events of September 11, many 
     small businesses have been physically and economically 
     devastated. Because of the unique character of this disaster, 
     many of the existing programs meant to act as a ``safety 
     net'' to the small business community have been found to be 
     inadequate or not available. Your bill, ``The American Small 
     Business Emergency Relief and Recover Act of 2001,'' serves 
     to correct these inequities and provide the economic tools 
     necessary for many small business owners to recover from this 
     tragedy.
       For those small business owners whose enterprises have been 
     shattered by the repercussions of the economic shockwave from 
     ground zero, we must extend the lifeline of assistance in the 
     form of expanded Small Business Administration low-interest 
     loans and programs. We must not let the recent tragedies 
     serve to dampen the drive and determination of our nation's 
     existing small business owners who may be struggling 
     financially as a result of the events of September 11.
       The U.S. Chamber of Commerce is the world's largest 
     business federation, representing more than three million 
     businesses of every size, sector, and region. More than 96 
     percent of the Chamber's members are small businesses with 
     100 or fewer employees. On behalf of these small employers, I 
     again thank you for introducing S. 1499, ``The American Small 
     Business Emergency Relief and Recover Act of 2001.''
           Sincerely,

                                              R. Bruce Josten.

                                         Executive Vice President,
     Government Affairs.
                                  ____

         The National Association of Government Guaranteed 
           Lenders, Inc.,
                                                   Stillwater, OK.
     Hon. John Kerry,
     Chairman, Senate Committee on Small Business and 
         Entrepreneurship, Russell Senate Building, Washington, 
         DC.
     Hon. Christopher Bond,
     Ranking Member, Senate Committee on Small Business and 
         Entrepreneurship, Russell Senate Building, Washington, 
         DC.
       Dear Senators Kerry and Bond: On behalf of the members of 
     the National Association of Government Guaranteed Lenders 
     (NAGGL), SBA's 7(a) lending partners, thank you for your 
     efforts to support capital access for small businesses, 
     especially in this time of heightened need. In accordance 
     with this need, NAGGL's leadership and membership fully 
     endorses S. 1499, the ``The American Small Business Emergency 
     Relief and Recovery Act of 2001.''
       This bill's goal is to provide small businesses with the 
     necessary financial assistance to spur them, and thus 
     America's greater economy, to full recovery. It will do this 
     by addressing the credit needs of a variety of small 
     businesses, from those located at or near disaster sites, to 
     the multitude of small businesses throughout the country that 
     were indirectly impacted by the events of September 11, 2001.
       Prior to September 11, there were already signs of a 
     slowing economy and a tightening of credit underwriting 
     standards by commercial lenders. Some small businesses were 
     already facing difficulty in obtaining credit. The events of 
     September 11th have only exacerbated these problems.
       This is why the quick passage of S. 1499 is so important. 
     This bill addresses the difficulties facing America's small 
     business sector, and so we encourage your Senate colleagues 
     to pass it expeditiously.
           Sincerely,
                                             Anthony R. Wilkinson,
     NAGGL President & CEO.
                                  ____



                                    National League of Cities,

                                 Washington, DC, October 30, 2001.
       Dear Senator: On behalf of 138,000 local elected officials, 
     the National League of Cities (NLC) strongly urges you and 
     your colleagues to support and push for immediate 
     consideration of S. 1499, the American Small Business 
     Emergency Relief and Recovery Act of 2001.
       In the wake of September 11, cities nationwide have 
     reported stress to local economies and city finances, and 
     have indicated that a decline in local business is one of 
     their greatest concerns. In a recent letter to Senator 
     Daschle and members of the Senate Finance and Budget 
     Committees, NLC urged inclusion of small business relief in 
     any economic stimulus package.
       S. 1499 would help the efforts of lending institutions, 
     community organizations and local public agencies in 
     providing assistance to small businesses. The measure would 
     expand access to Small Business Administration (SBA) low-
     interest or no-cost recovery loans to small businesses that 
     were directly or indirectly affected by the attacks, and 
     those in need of capital and investment financing or 
     procurement assistance.
       NLC has always supported adequate federal assistance to new 
     and existing small businesses, and this emergency legislation 
     reflects an important and timely effort by Congress to 
     recognize the impact of these attacks on local economies 
     nationwide by helping mitigate bankruptcies, business 
     closures, and lay-offs.
       If you have any questions or comments, please contact Scott 
     Shrum in our office at 202-626-3033.
           Sincerely,
                                                  Donald J. Borut,
     Executive Director.
                                  ____



                              National Restaurant Association,

                                Washington, DC, November 14, 2001.
     U.S. Senate,
     Washington, DC.
       Dear Senator: On behalf of the National Restaurant 
     Association, the leading trade group for the nation's 844,000 
     restaurant locations, we urge you to cosponsor S. 1499, the 
     American Small Business Emergency Relief and Recovery Act of 
     2001.
       S. 1499 would address both emergency relief needed in the 
     aftermath of the September 11 tragedies as well as the 
     magnified credit crunch caused by the economic downturn and 
     the uncertain economic outlook facing our nation. In October 
     2001, eating and drinking places cut 42,000 jobs, which 
     followed a 43,000 job reduction in September (seasonally-
     adjusted). This is the worst employment performance in the 
     industry for this two month period since records have been 
     kept.
       The purpose of S. 1499 is to help small businesses meet 
     their payments on existing debts, finance their businesses 
     and maintain jobs in the aftermath of the September 11 
     attacks by strengthening and expending access to the Small 
     Business Administration's loan payments and management 
     counseling. With 11.3 million employees, the restaurant 
     industry is our nation's largest employer outside of 
     government. Ninety-two percent of restaurant in the United 
     States have fewer than 50 employees.
       The National Restaurant Association applauds Senator John 
     Kerry and Senator Kit Bond for introducing this bipartisan 
     legislation and we ask that you consider cosponsoring S. 
     1499.
           Sincerely,
     Steven C. Anderson,
       President and CEO.
     Lee Culpepper,
       Senior Vice President, Government Affairs and Public 
     Policy.

  The PRESIDING OFFICER. The Senator from Missouri.
  Mr. BOND. Madam President, I ask unanimous consent to be permitted to 
speak as in morning business for up to 5 minutes.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  Mr. BOND. Madam President, there are a couple of issues on which I 
agree very strongly with my good friend, the chairman of the Small 
Business Committee, and one on which I disagree.

[[Page S12047]]

 First, I agree on the need to bring up an energy package, have a sound 
and full debate, and pass a sensible energy package. We need it. I 
disagree with him on the need to continue the environmentally sound 
development of natural resources and petroleum products out of ANWR.
  I have been on the North Slope, a frozen desert which is not harmed 
by drilling there now. The 2,000 acres that would be involved out of 
ANWR's 1.9 million acres will do nothing but provide a sounder base for 
the caribou that live there--I disagree on that, but I strongly agree 
with him on the need to bring up S. 1499.
  If a Senator has a problem with it, air it on the floor. We have 55 
cosponsors; 18 out of the 19 members of the Senate Small Business 
Committee said it is time to do something for small business.
  It had become apparent to all Members that in 2000 we had an economic 
slowdown. Officially, we are in a recession. As we know, as banks 
tighten credit standards, and as access to credit drops, small business 
slows down. In the wake of the September 11 terrorist attacks, there 
were significant weaknesses in the small business sector. We proposed a 
reasonable, bipartisan measure that can go a long way toward helping 
small business get the restart it needs to provide jobs and spur 
economic activity in this country.
  Very briefly, the American Small Business Emergency Relief and 
Recovery Act would make economic injury disaster loans available to all 
small businesses directly impacted by terrorist attacks. Businesses 
that shut down, such as airport shutdowns and general aviation 
shutdowns, and airport suppliers, would be allowed a repayment of 
principal and interest deferral for 2 years and interest could be 
forgiven.
  The SBA current disaster loan program was not designed to meet the 
extraordinary circumstances that came about as a result of the 
terrorist activities. It could be a year or more before many of the 
small businesses in New York City can open their doors. They could not 
repay the loans right away, so we allow them to defer.
  Small businesses throughout the United States have shut down. When 
general aviation was grounded, flight schools were closed, and other 
small businesses, depending on aircraft, were hurt. Our bill allows 
these small businesses to defer for 2 years repayment of principal and 
interest on their SBA disaster loans. Other small businesses 
experiencing economic problems that need help with their cashflow, 
working capital, or investments to continue their operation or hire 
more people would be available for special loan programs with a lower 
interest prime, with a 90 percent guarantee of the loan, and with a 
deferral of principal and payments for up to a year.
  Small businesses are already hurt. We need to give them a stimulus to 
get them moving again. There would be other breaks: No guarantee fees 
to be paid by small businesses. The amount that the SBA could guarantee 
would increase from 80 to 90 percent for loans up to $150,000 and from 
75 to 85 percent for loans greater than $150,000. The participating 
bank fees would be removed on 504 certified development company loans.

  That is what we propose. That is what the Small Business Committee 
says makes sense. Right now we are talking about coming forward with a 
$70 to $80 to $90 to $100 billion stimulus package because we know the 
economy needs a jump-start. That is $70 to $80 to $90 billion that 
would mostly be paid out in the hopes that people would use that money 
to buy and get business started again.
  We are in a business recession. The beauty of this program is no 
money is spent unless small business borrows money to put to work. We 
want small businesses to get back to work. This program doesn't cost a 
thing unless some small business goes out and borrows the money and 
puts it to work, buys equipment, uses it for working capital, uses it 
to pay employees.
  When we talk about credit scoring in the credit subsidy rates, 
people's eyes always glaze over. They say the total cost of the bill 
for 1 year is $815 million. That means they make $17 billion worth of 
loans, and somewhere around half a percent of those or $800 million may 
go bad. We are talking million. The rest is paid back. There are other 
minor losses on fees. Total cost to the Government is $816 million.
  I am almost embarrassed to come out here and talk about a stimulus 
package in terms of millions of dollars because anybody on this floor 
worth their salt can get up and talk about billions and billions and 
billions of dollars they would like to see in stimulus. We can get 
small business investing, growing, hiring more people, paying wages, 
buying equipment, being good customers for other businesses, for $816 
million.
  I think this bill makes sense. We have a majority of the Senate 
cosponsoring it. Let's get on with this bill. If we are not able to 
bring it up as a separate bill, I have this warm feeling that it will 
be offered as an amendment at some point and we will have an 
opportunity for that full debate at that time.
  I agree with my colleague from Massachusetts; I expect as usual when 
we are talking about helping small business, some 80 to 90 Members of 
this body will go along with us.
  I strongly urge my colleagues to let us know what their problems are 
with the bill, talk it out, get it done, and pass it. We are going to 
have an opportunity to vote on it at some point.
  I yield the floor.
  The PRESIDING OFFICER. The Senator from New York.
  Mrs. CLINTON. Madam President, I ask unanimous consent I be given up 
to 15 minutes as in morning business.
  The PRESIDING OFFICER. Without objection, it is so ordered.

                          ____________________