[Congressional Record Volume 153, Number 34 (Wednesday, February 28, 2007)]
[Senate]
[Pages S2365-S2366]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]

      By Ms. LANDRIEU (for herself, Mr. Kerry, Ms. Snowe, and Mr. 
        Vitter):
  S. 715. A bill to amend the Small Business Act to provide expedited 
disaster assistance, and for other purposes; to the Committee on Small 
Business and Entrepreneurship.
  Ms. LANDRIEU. Mr. President, as we all know, there was a tremendous 
amount of criticism of the Federal Government's response to Hurricanes 
Katrina and Rita last year. Things are better now and the region is 
slowly recovering. But, having luckily survived the 2006 hurricane 
season with no major storms, and with the 2007 season a few months 
away, we must be sure that if we have another disaster, the Federal 
Government's response will be better this time around. Disaster 
response agencies have to be better organized, more efficient, and more 
responsive in order to avoid the problems, the delays, mismanagement, 
and the seeming incompetence that occurred in 2005.
  Today, I am proud to sponsor legislation to improve the disaster 
response of one agency that had a great deal of problems last year, the 
Small Business Administration (SBA). This bill, the ``Small Business 
Disaster Recovery Improvement Act,'' makes a major improvement to the 
SBA's disaster response and provides them with an essential tool to 
ensure that they are more efficient and better prepared for future 
disasters--big and small. I should note that this bill is a result of 
intensive bipartisan work over the past couple of months on a larger 
SBA Disaster Reforms bill, S. 137, the ``Small Business Disaster 
Response and Loan Improvements Act,'' which was introduced early in the 
110th Congress. I feel strongly that this provision, an Expedited 
Disaster Assistance Loan Program for businesses, should be passed 
during this session of Congress, therefore I wanted to also introduce 
it in separate legislation for the 110th Congress. That said, I will 
continue to work with my colleagues on the Small Business Committee, 
Senators Kerry and Snowe, respectively Chair and Ranking Member of the 
Senate Small Business Committee, as well as with my colleague Senator 
Vitter to include this provision along with more comprehensive SBA 
Disaster Assistance reforms that we hope to enact in the coming months.
  After Hurricanes Katrina and Rita hit, our businesses and homeowners 
had to wait months for loan approvals. I do not know how many 
businesses we lost because help did not come in time. What these 
businesses needed was immediate, short-term assistance to hold them 
over until SBA was ready to process the tens of thousands of loan 
applications it received.
  That is why this legislation provides the SBA Administrator with the 
ability to set up an expedited disaster assistance business loan 
program to make short-term, low- interest loans to keep them afloat. 
These loans will allow businesses to make payroll, begin making 
repairs, and address other immediate needs while they are awaiting 
insurance payouts or regular SBA Disaster Loans. However, I realize 
that every disaster is different and could range from a disaster on the 
scale of Hurricanes Katrina or Rita or 9-11, to an ice storm or 
drought. This legislation gives the SBA additional options and 
flexibility in the kinds of relief they can offer a community. When a 
tornado destroys 20 businesses in a small town in the Midwest, SBA can 
get the regular disaster program up and running fairly quickly. You may 
not need short-term loans in this instance. But if you know that SBA's 
resources would be overwhelmed by a storm--just as they were initially 
with the storms of 2005--these expedited business loans would be very 
helpful.
  The Small Business Disaster Recovery Improvement Act will provide an

[[Page S2366]]

essential tool to make the SBA more proactive, flexible, and most 
important, more efficient during future disasters. If SBA is not in the 
business of short-term assistance for future disasters, I feel that we 
will again see businesses fail while waiting for SBA to get its act 
together. The agency has implemented some major changes to its Disaster 
Assistance Program but, if the storms of 2005 taught us anything it was 
that the best laid plans can fail. This Expedited Disaster Assistance 
Loan Program would ensure that SBA has a backup tool to provide 
immediate assistance to impacted businesses. Again, I look forward to 
working with both Senator Snowe and Senator Kerry during the coming 
weeks to ensure that the SBA has everything it needs to respond to 
future disasters.
  I ask unanimous consent that the text of the legislation be printed 
in the Record.
  There being no objection, the text of the bill was ordered to be 
printed in the Record, as follows:

                                 S. 715

       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 ``Small Business Disaster 
     Recovery Assistance Improvement Act of 2007''.

     SEC. 2. BUSINESS EXPEDITED DISASTER ASSISTANCE LOAN PROGRAM.

       (a) Definitions.--In this section--
       (1) the terms ``Administration'' and ``Administrator'' mean 
     the Small Business Administration and the Administrator 
     thereof, respectively;
       (2) the term ``immediate disaster assistance'' means 
     assistance provided during the period beginning on the date 
     on which a disaster declaration is made and ending on the 
     date that an impacted small business concern is able to 
     secure funding through insurance claims, Federal assistance 
     programs, or other sources;
       (3) the term ``program'' means the expedited disaster 
     assistance business loan program established under subsection 
     (b); and
       (4) the term ``small business concern'' has the meaning 
     given that term in section 3 of the Small Business Act (15 
     U.S.C. 632).
       (b) Creation of Program.--The Administrator shall take such 
     administrative action as is necessary to establish and 
     implement an expedited disaster assistance business loan 
     program to provide small business concerns with immediate 
     disaster assistance under section 7(b) of the Small Business 
     Act (15 U.S.C. 636(b)).
       (c) Consultation Required.--In establishing the program, 
     the Administrator shall consult with--
       (1) appropriate personnel of the Administration (including 
     District Office personnel of the Administration);
       (2) appropriate technical assistance providers (including 
     small business development centers);
       (3) appropriate lenders and credit unions;
       (4) the Committee on Small Business and Entrepreneurship of 
     the Senate; and
       (5) the Committee on Small Business of the House of 
     Representatives.
       (d) Rules.--
       (1) In general.--Not later than 1 year after the date of 
     enactment of this Act, the Administrator shall promulgate 
     rules establishing and implementing the program in accordance 
     with this section. Such rules shall apply as provided for in 
     this section, beginning 90 days after their issuance in final 
     form.
       (2) Contents.--The rules promulgated under paragraph (1) 
     shall--
       (A) identify whether appropriate uses of funds under the 
     program may include--
       (i) paying employees;
       (ii) paying bills and other financial obligations;
       (iii) making repairs;
       (iv) purchasing inventory;
       (v) restarting or operating a small business concern in the 
     community in which it was conducting operations prior to the 
     declared disaster, or to a neighboring area, county, or 
     parish in the disaster area; or
       (vi) covering additional costs until the small business 
     concern is able to obtain funding through insurance claims, 
     Federal assistance programs, or other sources; and
       (B) set the terms and conditions of any loan made under the 
     program, subject to paragraph (3).
       (3) Terms and conditions.--A loan made by the 
     Administration under this section--
       (A) shall be a short-term loan, not to exceed 180 days, 
     except that the Administrator may extend such term as the 
     Administrator determines necessary or appropriate on a case-
     by-case basis;
       (B) shall have an interest rate not to exceed 1 percentage 
     point above the prime rate of interest that a private lender 
     may charge;
       (C) shall have no prepayment penalty;
       (D) may be refinanced as part of any subsequent disaster 
     assistance provided under section 7(b) of the Small Business 
     Act; and
       (E) shall be subject to such additional terms as the 
     Administrator determines necessary or appropriate.
       (e) Report to Congress.--Not later than 5 months after the 
     date of enactment of this Act, the Administrator shall report 
     to the Committee on Small Business and Entrepreneurship of 
     the Senate and the Committee on Small Business of the House 
     of Representatives on the progress of the Administrator in 
     establishing the program.
       (f) Authorization.--There are authorized to be appropriated 
     to the Administrator such sums as are necessary to carry out 
     this section.
                                 ______