[Congressional Record Volume 153, Number 45 (Thursday, March 15, 2007)]
[Senate]
[Pages S3211-S3212]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]

      By Ms. SNOWE (for herself, Mr. Pryor, and Mr. Craig):
  S. 904. A bill to provide additional relief for small business owners 
ordered to active duty as members of reserve components of the Armed 
Forces, and for other purposes; to the Committee on Small Business and 
Entrepreneurship.
  Ms. SNOWE. Mr. President, I rise today to introduce the Veterans 
Small Business Opportunity Act of 2007. Senators Pryor, Craig, and I 
are introducing this legislation to assist veterans and small 
businesses that employ Guard and reservists. Our bill improves the 
Small Business Administration's, SBA's, Military Reservist Economic 
Injury Disaster Loan, MREIDL, program. Additionally, this bill 
increases procurement opportunities, capital access, and other types of 
business development assistance for veterans and service-disabled 
veterans.
  We all know today's small business men and women play a vital role in 
the economic stability and prosperity of our Nation. Quite often, these 
same entrepreneurs are the veterans who have protected our Nation in 
years past, or who serve in the Armed Forces today. When our Nation's 
patriotic men and women are called to duty, they often leave behind 
thriving small businesses, and as a result, many of these businesses 
experience production slowdowns and lost sales, or incur additional 
expenses to compensate for an employee's absence.
  In recent years, the Department of Defense has placed a greater 
reliance on our country's Guard and Reserve Forces. In fact, since 
September 2001, nearly 600,000 Guard and Reserve members have been 
called up in support of current operations, comprising nearly one-third 
of deployed service members in Iraq and Afghanistan. Furthermore, Guard 
and Reserve members were charged with assisting recovery efforts in the 
gulf coast region in the aftermath of Hurricanes Katrina and Rita.
  In my 4 years as chair of the Senate Committee on Small Business and 
Entrepreneurship, and now as ranking member, I have fought to support 
our patriotic small businesses affected by the Guard and Reserve call-
ups. My home State of Maine has one of the highest Guard and Reserve 
deployment levels in the country--over 50 percent have been deployed to 
Iraq and Afghanistan. In response to this I commissioned a 
Congressional Budget Office, CBO, study which found that 35 percent of 
Guard and reservists work for small busineses or are self-employed. In 
addition, the small businesses that employ them may be ``paying'' a 
disproportionate and unfair share of the burden of increased Guard and 
Reserve member call-ups. The burden is further magnified when it is the 
small business owner or a key employee who is deployed.
  Our legislation will raise the maximum MREIDL amount from $1,500,000 
to $2,000,000. A maximum military reservist loan amount of $2,000,000 
is the same level as many of the SBA's other loan programs, including: 
7(a) loans, international trade loans, and 504 Certified Development 
Corporation loans that serve a public policy goal.
  Currently, some of the SBA's contracting and business development 
programs have defined time limits for participation. If the firm's time 
for participation expires prematurely, then competitive opportunities, 
investments, and jobs become lost. Today, small business owners who get 
called-up to active duty in the National Guard or Reserve are 
effectively penalized because their active duty time is counted against 
the time limitation participation in the SBA's programs. The Veterans 
Small Business Opportunity Act amends the Small Business Act by 
allowing small businesses owned by veterans and service-disabled 
veterans to extend their SBA program participation time limitations by 
the duration of their owners' active duty service after September 11, 
2001.

  Additionally, this bill will allow the SBA Administrator, either 
directly or through banks, to offer loans up to $25,000 without 
requiring collateral from a loan applicant. Currently, the SBA offers 
military reservist loans up to $5,000 without collateral. This 
provision would increase that level to eligible small businesses.
  The bill will also require the Administrator to give military 
reservist loan applications priority for processing and ensure that 
Guard and Reserve members are adequately assisted with their loan 
application by incorporating the support and expertise of SBA 
entrepreneurial development partners, such as Small Business 
Development Centers and Veterans Business Outreach Centers.
  This legislation increases the authorization of appropriations for 
the SBA's Office of Veteran Business Development to $2 million for 
fiscal year 2008, $2.1 million for fiscal year 2009 and $2.2 million 
for fiscal year 2010. Increased funding for SBA's Office of Veterans 
Business Development help them better assist our Nation's veterans and 
provide the business services they need.
  This legislation will also strengthen the access of veterans and 
service-disabled veterans to Federal contracts and subcontracts. Under 
the Small Business Act and the President's Executive Order 13360, 
Providing Opportunities for Service-Disabled Veteran Businesses To 
Increase Their Federal Contracting and Subcontracting, Federal agencies 
must award at least 3 percent of prime contracts and subcontracts to 
small businesses owned by service-disabled veterans. The order states 
that, to achieve these goals, Federal agencies ``shall more 
effectively'' use the authorities in the Small Business Act to reserve 
and award contracts to service-disabled veterans. During the Senate 
Small Business and Entrepreneurship Committee hearing held in January, 
it became very clear that Federal agencies have been short-changing 
service-disabled veteran-owned small businesses to the tune of over 
$7.5 billion a year in government contracts during fiscal year 2003 
through fiscal year 2005. To remedy this unacceptable situation, our 
legislation puts the force of a congressional statute behind the 
requirements of the President's Executive order.
  In addition, our legislation ensures that veterans and service-
disabled veterans do not face confusing and duplicative red tape before 
they can be eligible to access the Federal procurement market. 
Currently, the Department of

[[Page S3212]]

Veterans Affairs and the SBA both operate registration databases for 
small businesses owned by veterans and service-disabled veterans. A 
veteran must often register in both databases to be properly considered 
for bidding. Surely, in this information age, we can have a better 
process. Registration data can easily be made to migrate from one 
database to the other. Our legislation requires that a single 
registration point for both of these databases be established within a 
year. Such one-stop registration must be reliable and compliant with 
statutory provisions concerning veteran and service-disabled veteran 
status certifications for small businesses.

  To increase the capacity of service-disabled veteran-owned firms, my 
legislation permits the SBA, in cooperation with the Department of 
Veterans Affairs, to develop a business development assistance program, 
including mentor-protege assistance, to be administered by the SBA. Our 
legislation contains a strict fairness requirement that any such 
program must be developed in such a way as to ensure success of other 
small business contracting programs. Within a year, the SBA is required 
to submit a report to Congress on its proposals for this program. In 
2004, I succeeded in amending the Department of Defense Mentor-Protege 
Program statute by expanding it to service-disabled veterans. Since 
then, over $204 million in contracts and subcontracts have been awarded 
to service-disabled veteran-owned small businesses as a result of the 
$17 million in mentor-Protege assistance. This represents a stunning 
$12 return for every $1 in assistance investment. I believe the success 
of this initiative should be replicated. The SBA is already 
administering a Mentor-Protege Program as part of the 8(a) business 
development program for small disadvantaged businesses, and both the 
SBA and the DOD programs would provide useful examples for helping our 
disabled veterans succeed.
  Finally, our legislation creates an interagency task force among 
Federal agencies charged with improving procurement opportunities for 
service-disabled veterans. The scope of this task force will, in 
addition to procurement, include franchising, capital access, and other 
types of business development assistance. In examining the 
implementation of Executive Order 13360 and other veterans business 
development initiatives, our committee found that the responsible 
agencies were not talking to each other on a regular basis, and that no 
overall ``game plan'' was in place to coordinate various Federal 
efforts.
  I would like to thank Senators Pryor and Craig for working with me on 
this critical issue and I urge my colleagues to support this bill.
  Mr. CRAIG. Mr. President, I rise to comment on a bill that is being 
introduced by Senator Snowe today, the Veterans Small Business 
Opportunity Act of 2007. I am proud to join with Senator Snowe and 
Senator Pryor as an original cosponsor of this important bill.
  This legislation will benefit patriot ``citizen-soldiers'' who are 
called from their employment at America's small businesses to serve our 
country in uniform. In States across the Nation, small businesses are 
being affected by the mobilization of our Guard and Reserve personnel. 
In my home State, the Idaho National Guard's 116th Brigade Combat Team 
returned in 2005 from an 18-month deployment to Iraq. I visited members 
of the 116th while they were in Iraq and discovered that a good number 
had left jobs at small businesses across Idaho. I also held a hearing 
in Idaho during the 109th Congress to examine the reemployment rights 
of returning Guard and Reserve members.
  At that hearing, it was emphasized that, although legal rights to 
reemployment are critical, they do little for those who have no 
employer, or no small business, to return to. To me, it was clear that 
we should do more to help small businesses in coping with the financial 
hardships of frequent and lengthy mobilizations of its employees or 
owners during the war on terrorism. I believe we can provide some of 
that needed assistance with this legislation, which includes key 
provisions from The Patriot Loan Act of 2006, a bill that Senator Snowe 
and I introduced last year.
  This bill would enhance the U.S. Small Business Administration's 
Military Reservist Economic Injury Disaster Loan, or MREIDL, Program. 
That program provides loan assistance to small businesses to help them 
meet ordinary and necessary operating expenses after essential 
employees are called to active duty in their roles as citizen-soldiers.
  This bill would raise the maximum military reservist loan amount from 
$1.5 million to $2 million. It would also allow the Small Business 
Administration, by direct loan or through banks, to offer unsecured 
loans of up to $25,000, an increase from the current $5,000 limit. In 
addition, this bill would ensure proactive outreach to Guard and 
Reserve members about the MREIDL Program and other small business 
programs by requiring SBA and the Department of Defense to develop a 
joint Web site and printed materials with information about those 
programs.
  For the brave men and women who serve our Nation in the Guard and 
Reserve, we must do what we can to ensure that their sacrifices do not 
place them in financial harm's way when they return home. I urge my 
colleagues to support these measures, and I thank Senator Snowe for her 
leadership in introducing this bill.
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