[Congressional Record Volume 150, Number 108 (Monday, September 13, 2004)]
[House]
[Pages H7028-H7031]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]
PROVIDING FOR TEMPORARY EXTENSION OF PROGRAMS UNDER SMALL BUSINESS ACT
AND SMALL BUSINESS INVESTMENT ACT OF 1958
Mrs. CAPITO. Mr. Speaker, I move to suspend the rules and pass the
bill (H.R. 5008) to provide an additional temporary extension of
programs under the Small Business Act and the Small Business Investment
Act of 1958 through September 30, 2004, and for other purposes.
The Clerk read as follows:
H.R. 5008
Be it enacted by the Senate and House of Representatives of
the United States of America in Congress assembled,
SECTION 1. ADDITIONAL TEMPORARY EXTENSION OF PROGRAMS UNDER
SMALL BUSINESS ACT AND SMALL BUSINESS
INVESTMENT ACT OF 1958.
The authorization for any program, authority, or provision,
including any pilot program, that was extended through June
4, 2004, by section 1 of Public Law 108-217 is further
extended through September 30, 2004, under the same terms and
conditions.
SEC. 2. TECHNICAL AMENDMENT.
Section 2 of Public Law 108-205 is amended by striking
``October 1, 2003'' and inserting ``March 15, 2004''. The
amendment made by the preceding sentence shall take effect as
if included in the enactment of the section to which it
relates.
SEC. 3. COMPENSATION OF AGENTS.
Section 5 of the Small Business Act (15 U.S.C. 634) is
amended--
(1) in subsection (g)(4), by adding at the end the
following:
``(C) The Administration may contract with an agent to
carry out, on behalf of the Administration, the assessment
and collection of the annual fee established under section
7(a)(23). The agent may receive, as compensation for
services, any interest earned
[[Page H7029]]
on the fee while in the control of the agent before the time
at which the agent is contractually required to remit the fee
to the Administration.''; and
(2) in subsection (h)--
(A) by redesignating paragraph (2) as paragraph (3); and
(B) by inserting after paragraph (1) the following:
``(2) The agent described in paragraph (1)(B) may be
compensated through any of the fees assessed under this
section and any interest earned on any funds collected by the
agent while such funds are in the control of the agent and
before the time at which the agent is contractually required
to transfer such funds to the Administration or to the
holders of the trust certificates, as appropriate.''.
The SPEAKER pro tempore (Mr. Flake). Pursuant to the rule, the
gentlewoman from West Virginia (Mrs. Capito) and the gentlewoman from
New York (Ms. Velazquez) each will control 20 minutes.
The Chair recognizes the gentlewoman from West Virginia (Mrs.
Capito).
General Leave
Mrs. CAPITO. Mr. Speaker, I ask unanimous consent that all Members
may have 5 legislative days within which to revise and extend their
remarks and include extraneous material on H.R. 5008.
The SPEAKER pro tempore. Is there objection to the request of the
gentlewoman from West Virginia?
There was no objection.
Mrs. CAPITO. Mr. Speaker, I yield myself such time as I may consume.
Mr. Speaker, this bill extends until September 30 the programs of the
Small Business Administration not covered by an appropriation,
including the Preferred Surety Bond Program, SBA's Private Sector
Cosponsorship Authority, the Small Disadvantaged Business Procurement
Assistance Program, the Small Business Development Center Drug-Free
Workplace Assistance Grants Program and the Very Small Business
Concerns Program.
Last June, the House acted responsibly by passing H.R. 4478 to extend
the programs of the SBA, but the other body failed to act. These
programs have been in limbo since June 4, and it is important that they
are extended while we continue to work on an SBA reauthorization bill.
In addition, H.R. 5008 would help many existing Women's Business
Centers keep their doors open. Passage of H.R. 5008 would free up the
remaining $4 million already appropriated for the program this year to
provide at a minimum approximately $70,000 to each Women's Business
Center and sustainability status.
Finally, H.R. 5008 corrects a legal problem regarding how the SBA
pays fiscal transfer agents, who provide a vital role in the secondary
market. For nearly 10 years, the SBA's fiscal transfer agent has been
paid by a float on interest on the pools of securitized 7(a) guaranteed
loans. Recently there has been some confusion as to whether or not this
practice violates the Anti-Deficiency Act. The SBA has proposed a fix
to this problem, and that solution is incorporated in section 3 of H.R.
5008, which essentially codifies the existing practice.
Passage of this legislation is needed in order to prevent the
crippling of the SBA's 7(a) loan program, because without the liquidity
of a secondary market banks will not make as many 7(a) loans as in the
past.
This bipartisan bill has the support of the ranking minority member,
the gentlewoman from New York (Ms. Velazquez), and it has the support
of the Bush administration. I urge my colleagues to support H.R. 5008.
Mr. Speaker, I reserve the balance of my time.
Ms. VELAZQUEZ. Mr. Speaker, I yield myself such time as I may
consume.
(Ms. VELAZQUEZ asked and was given permission to revise and extend
her remarks.)
Ms. VELAZQUEZ. Mr. Speaker, we are here today because Congress has
failed to complete its work. Over 1 year ago, the Committee on Small
Business unanimously reported out a bipartisan reauthorization bill. As
a result of the failure to move this legislation, the authorization for
the SBA expired last year and we are now forced to pass our fourth
extension. Shamefully, the agency has been operating for 3 months
without any authorization.
It is clear that the Nation's job creators, small businesses, are
struggling. The United States has lost 1.7 million jobs since 2001, and
we are continuing to see growth rates that only keep up with inflation.
American manufacturers are being hit hardest, with 2.7 million jobs
lost during that period and 11,000 lost in June alone. This is clearly
not the picture of an economy that is getting back on its feet.
Last week, the House Committee on Small Business Democrats released a
quarterly small business index showing that business conditions are at
7-year lows. Skyrocketing health care and energy costs and exploding
Federal budget deficits are but a few of the barriers small firms face
in achieving the growth our economy needs so badly.
At a time when we should be providing our Nation's entrepreneurs a
leg up, this administration and the Republican Congress has
continuously failed to provide the assistance they need by blocking
passage of the SBA reauthorization.
The bipartisan reauthorization bill will provide the most
comprehensive overhaul of the SBA in over a decade. It will broaden or
modernize the SBA loan programs so firms can access the capital they
need. At a time when the Federal Government failed to meet the small
business contracting goals for the fourth consecutive year, the
Republican leadership is blocking this bill that will expand
procurement opportunities for small companies.
The legislation ensures small firms are given a fair chance to break
into the Federal marketplace. By doing so, we provide the Federal
Government a quality service at a good price. This is not just good for
small businesses, it is good for the American taxpayer. Additionally,
the likelihood of success for small business is nearly doubled when
they have access to technical assistance.
Passage of the reauthorization bill will offer the greatest expansion
of entrepreneurial assistance programs in decades.
Even more concerning is the possibility that our failure to act will
actually worsen the business environment for small businesses. Small
businesses are faced with a possible doubling of fees on SBA loans at
the end of this month. Without immediate action, the current structure
will lapse, leaving banks and entrepreneurs in a worse situation than
when the program was shut down last year.
Although the gentleman from Illinois (Chairman Manzullo), who cannot
be here today, has tried repeatedly to bring this bill up for
consideration, the Republican House leadership and the administration
have blocked it.
In today's economic climate, small businesses are more important than
ever. We need to ensure that they have all the tools for success, as
they are facing numerous obstacles. It is unfortunate that we are here
today passing an extension, rather than celebrating the passage of an
SBA reauthorization.
These issues should not be subject to partisan politics. When our
small businesses need us the most, our committee was able to work in a
bipartisan manner to produce this legislation. We now ask the
Republican leadership to recognize these efforts and pass the
reauthorization bill that will get small businesses back creating jobs.
Mr. Speaker, I yield 2 minutes to the gentlewoman from Guam (Ms.
Bordallo).
Ms. BORDALLO. Mr. Speaker, I rise today in support of H.R. 5008, and
I would like to take this time to thank the chairman of the Committee
on Small Business, the gentleman from Illinois (Chairman Manzullo), and
the ranking member, the gentlewoman from New York (Ms. Velazquez), for
their continued leadership in crafting a long-term reauthorization of
the Small Business Administration.
As you know, Mr. Speaker, H.R. 5008 will provide temporary
reauthorization of the Small Business Administration. While I support
H.R. 5008, I do share the ranking member's frustration that we still
have not had the opportunity to vote to pass a permanent
reauthorization of the Small Business Administration, and consequently
this raises concerns about the future of the 7(a) loan guarantee
program, which is often the only source of long-term financing on
reasonable terms for small businesses, particularly those in poor,
rural and underserved areas.
While H.R. 5008 will maintain the current authority for the 7(a)
program,
[[Page H7030]]
small business owners will see a doubling of administration fees.
As you know, Mr. Speaker, the Committee on Small Business approved on
a unanimous, bipartisan basis a permanent Small Business Administration
reauthorization, H.R. 2802. The committee marked up this bill on July
21, 2003. H.R. 2802 would revise the 7(a) fee calculation for small
businesses, avoiding the increase that they will otherwise face under
the current authority.
{time} 1715
These small firms represent the future of our economy, Mr. Speaker,
as they account for 75 percent of all new jobs created in the United
States.
Therefore, I hope that we can work together to resolve any
outstanding issues with respect to this bill and move this important
legislation to the floor before we recess. In the meantime, I
respectfully urge my colleagues to vote today in favor of the temporary
reauthorization.
Mrs. CAPITO. Mr. Speaker, I yield myself such time as I may consume.
While reauthorization is extremely important, I think it would
behoove us at this time to really think about all of the things that
have been done and are in the process of being done for small
businesses here and across America.
Twenty-five million small business owners will receive tax relief,
totaling $75 billion. That is real savings. The rate reductions in the
tax benefit plan is more than 90 percent small business. We also have
raised the small business expensing limit from $25,000 to $100,000, and
I can tell my colleagues in my home State of West Virginia, small
businesses are beginning to do and beginning to feel the growth effects
of being able to hire another person, being able to buy that extra
piece of equipment as a result of the tax incentives.
Regulation, which is another burdensome thing on small business, this
administration has slowed the growth of burdensome new rules by 75
percent. Also, small businesses saved $7 billion last year in
regulatory costs, and that is significant.
We have worked a lot to try to incent and grow our small businesses,
and there is always more, much more, that can be done. But in terms of
government procurement, for the first time in many years, the Federal
Government exceeded its small business goal by providing a record $65.5
billion in prime contracts to small businesses. That is a significant
increase over past years.
So, in conclusion, I would like to say that reauthorization of SBA is
exceedingly important to small business, and what we are doing here
today in extending the authorization is extremely important. But much
has been done and much needs to still continue to be done to help small
business, which is the backbone of our American economy.
Mr. Speaker, I reserve the balance of my time.
Ms. VELAZQUEZ. Mr. Speaker, I yield myself such time as I may
consume.
I would like to set the record straight regarding the tax cut that
the President submitted to Congress and that Congress passed.
The tax cuts are not helping small businesses. The President's tax
cuts have provided little relief for small businesses. In fact, under
the latest tax cut, over half of small businesses receive less than
$500, despite a cost of $350 billion. And, while the President talks
about how the top tax rate cut helps small businesses, only 1 percent
of small business owners benefit from the reduction in the top tax
rate. In fact, out of the 28 million small businesses, only 180,000
benefited from the top tax rate, according to the figures presented to
us by the Department of the Treasury. Those are your own numbers. Less
than 5 percent of the latest 2003 Jobs and Growth package was in the
form of targeted tax relief for small businesses.
Mr. Speaker, I yield 3 minutes to the gentlewoman from the Virgin
Islands (Mrs. Christensen).
Mrs. CHRISTENSEN. Mr. Speaker, I thank the gentlewoman for yielding
me this time.
Although I would rather be here to support the SBA reauthorization, I
rise today in support of H.R. 5008, which would simply, once again,
extend the important programs under the Small Business Act and the
Small Business Investment Act.
Mr. Speaker, H.R. 5008 marks the fourth extension of the SBA
programs. The House Committee on Small Business passed the extension on
the SBA programs with bipartisan support a year ago. I want to take
this opportunity to commend the leadership of our ranking member, the
gentlewoman from New York (Ms. Velazquez), and our chairman for their
strong leadership and their bipartisanship in working on that
reauthorization.
Yet, the House leadership has failed to bring this bill to the floor
for a vote. Why?
The leadership in this and the other body give a lot of lip service
to small business. We constantly tout them as the backbone and the
engines of our economy. Yet, on legislation as critical to their and,
thus, our Nation's well-being as the reauthorization of programs on
which they depend, this Congress has, once again, failed to act.
It is getting late in the year. Our small businesses cannot wait.
They need security now. They need the assurance that the programs they
will need to continue will be there now. They need to know what to
expect, and we need to stop these stop-gap measures and give them that
security and that assurance.
I am particularly concerned because I have heard Members ask, Why
should we continue to fund agencies and programs that have not been
reauthorized?
Mr. Speaker, actions speak louder than words. Failure to act on this
legislation is sending the message that our Nation's small businesses
are not a priority for this administration. But they are very important
to both the Democrats and the Republicans on the committee.
It is also of great concern that this bill fails to address the
current problem of high fees associated with the 7(a) program, the
flagship lending program for the Small Business Administration. If the
leadership fails to bring the reauthorization to a vote by the end of
this month, the 7(a) lending program will once again be in jeopardy.
It is a good thing that, in our districts, the agencies charged with
supporting small businesses are doing what they need to do. On that
positive note, I would like to take this opportunity to recognize and
congratulate the University of the Virgin Islands Small Business
Development Center, the university president, Dr. Laverne Ragster, and
the SBDC director, Mr. Warren Bush, for successfully hosting its Small
Business Innovation Research Program and Small Business Technology
Transfer Program Orientation Conference last week.
Finally, on a bill previously before this body today, I want to take
this opportunity to also join my colleagues in supporting House
Resolution 717 and belatedly extend, on behalf of all of my
constituents in the U.S. Virgin Islands, our best wishes to President
Bill Clinton on his 58th birthday, as well as to wish him a continued
speedy recovery, many, many more birthdays and good health and
happiness, and God's richest blessings on him and his family.
Mrs. CAPITO. Mr. Speaker, I reserve the balance of my time.
Ms. VELAZQUEZ. Mr. Speaker, I yield 2 minutes to the gentleman from
Massachusetts (Mr. Tierney).
Mr. TIERNEY. Mr. Speaker, I thank the gentlewoman from New York, both
for yielding me this time and for bringing this matter to the floor
today.
It is obviously essential that we finally take some action on this
legislation. We need to extend critical funding to women's business
centers across the United States. In particular, the Center for Women
and Enterprise in Boston serves many of the constituents in my district
and throughout the State of Massachusetts. It has been long overdue,
and many of these centers have already suffered because of Congress's
inaction.
It is a bit disturbing to know that it has been 10 months since the
Small Business Administration authorization bill has expired. And it
continues to linger, and we need the majority to come forward and the
White House to come forward at this point in time and bring it and put
it on the agenda. Everybody has great rhetoric about how important
small businesses are to our country, to our districts and to the
economy. But now it is time to put that rhetoric into action and make
sure we move on this bill.
[[Page H7031]]
We do not have to tell people or remind them about how this economy
is suffering: almost 2 million jobs lost in the last several years and
still not anywhere near back to where we were in January of 2001.
We know what a generator of jobs, what a booster of the economy small
businesses can be, and we also know how important the Small Business
Administration is in providing capital for these businesses. So if we
could do the bill that is before us today but also bring forward the
Small Business Administration reauthorization, we could deal with that
issue of capital.
At a time when the economy is suffering as much as it is, many
businesses are starting to fail. They need that capital so that they
can retool. Some need it to grow. And we need some new businesses to
fill in where others have left. That cannot happen without this bill
coming forward.
The so-called 7(a) loans are by far the most critical capital
vehicles that we have for small businesses: $11 billion in loans to
small businesses every year. That aspect has to be assured to
businesses. If we do nothing by the end of this month, fees for that
will double, freezing out many businesses from the opportunity to get
access to this money so that they can expand or they can start up.
Time after time, we hear on the floor and we hear in people's
individual districts how much they feel for small business and how
certain they are that small businesses add to the benefit of our
country.
Mr. Speaker, we need to put our money where our mouth is. We need
this measure to be brought forward. I support today's bill because it
does a good thing, particularly with respect to the women's business
centers across the country, but realize that we have to do more and
move the Small Business Administration reauthorization forward.
Mrs. CAPITO. Mr. Speaker, I continue to reserve the balance of my
time.
Ms. VELAZQUEZ. Mr. Speaker, I yield myself such time as I may
consume.
Mr. Speaker, there is no disagreement that we should pass this
extension. It is, though, embarrassing that it has come to this. We
expect small businesses to meet their taxes, comply with Federal
regulations and pay their employees on time. But when it comes to
Congress, we are not held accountable for our failure to meet their
needs.
At a time when our economy is struggling, at a time when small
businesses are struggling, Congress should be holding up its end of the
deal. Passing the Small Business Administration Reauthorization Act
must be a priority.
Mr. Speaker, I yield back the balance of my time.
Mrs. CAPITO. Mr. Speaker, I yield myself such time as I may consume.
I would like to thank the gentlewoman from New York (Ms. Velazquez)
for not only her advocacy for this bill before us today, but for her
advocacy for small business. She is one of the staunchest cheerleaders
for small businesses across this Nation, and I appreciate her service
and her ability to get things done.
I thank our chairman, the gentleman from Illinois (Chairman
Manzullo), who is not with us today, to thank him also for his small
business advocacy. It is good to know that we have a bipartisan opinion
on this bill. I look forward to its passage, and I look forward to all
of us working together to see that small business not only grows but
thrives under this bill and also under further legislation.
Mr. Speaker, I yield back the balance of my time.
The SPEAKER pro tempore (Mr. Flake). The question is on the motion
offered by the gentlewoman from West Virginia (Mrs. Capito) that the
House suspend the rules and pass the bill, H.R. 5008.
The question was taken; and (two-thirds having voted in favor
thereof) the rules were suspended and the bill was passed.
A motion to reconsider was laid on the table.
____________________