[Congressional Record Volume 155, Number 165 (Friday, November 6, 2009)]
[House]
[Pages H12471-H12473]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




                              {time}  1030
        SMALL BUSINESS DISASTER READINESS AND REFORM ACT OF 2009

  Ms. VELAZQUEZ. Mr. Speaker, I move to suspend the rules and pass the 
bill (H.R. 3743) to amend the Small Business Act to improve the 
disaster relief programs of the Small Business Administration, and for 
other purposes, as amended.
  The Clerk read the title of the bill.
  The text of the bill is as follows:

                               H.R. 3743

       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 
     Readiness and Reform Act of 2009''.

     SEC. 2. REVISED COLLATERAL REQUIREMENTS.

       Section 7 of the Small Business Act (15 U.S.C. 636) is 
     amended--
       (1) by striking ``(e) [RESERVED].'' and ``(f) 
     [RESERVED].''; and
       (2) in subsection (f), as added by section 12068(a)(2) of 
     the Small Business Disaster Response and Loan Improvements 
     Act of 2008 (subtitle B of title XII of the Food, 
     Conservation, and Energy Act of 2008; Public Law 110-246), by 
     adding at the end the following:
       ``(2) Revised collateral requirements.--In making a loan 
     with respect to a business under subsection (b), if the total 
     approved amount of such loan is less than or equal to 
     $250,000, the Administrator may not require the borrower to 
     use the borrower's home as collateral.''.

     SEC. 3. INCREASED LIMITS.

       Section 7(b) of the Small Business Act (15 U.S.C. 636(b)) 
     is amended--
       (1) in paragraph (3)(E) by striking ``$1,500,000'' each 
     place it appears and inserting ``$3,000,000''; and
       (2) in paragraph (8)(A) by striking ``$2,000,000'' and 
     inserting ``$3,000,000''.

     SEC. 4. REVISED REPAYMENT TERMS.

       Section 7(f) of the Small Business Act (15 U.S.C. 636(f)) 
     is amended by adding at the end the following:
       ``(3) Revised repayment terms.--In making loans under 
     subsection (b), the Administrator--
       ``(A) may not require repayment to begin until the date 
     that is 12 months after the date on which the final 
     disbursement of approved amounts is made; and
       ``(B) shall calculate the amount of repayment based solely 
     on the amounts disbursed.''.

     SEC. 5. REVISED DISBURSEMENT PROCESS.

       Section 7(f) of the Small Business Act (15 U.S.C. 636(f)), 
     as amended by this Act, is further amended by adding at the 
     end the following:
       ``(4) Revised disbursement process.--In making a loan under 
     subsection (b), the Administrator shall disburse loan amounts 
     in accordance with the following:
       ``(A) If the total amount approved with respect to such 
     loan is less than or equal to $150,000--
       ``(i) the first disbursement with respect to such loan 
     shall consist of 40 percent of the total loan amount, or a 
     lesser percentage of the total loan amount if the 
     Administrator and the borrower agree on such a lesser 
     percentage;
       ``(ii) the second disbursement shall consist of 50 percent 
     of the loan amounts that remain after the first disbursement, 
     and shall be made when the borrower has produced

[[Page H12472]]

     satisfactory receipts to demonstrate the proper use of 50 
     percent of the first disbursement; and
       ``(iii) the third disbursement shall consist of the loan 
     amounts that remain after the preceding disbursements, and 
     shall be made when the borrower has produced satisfactory 
     receipts to demonstrate the proper use of the first 
     disbursement and 50 percent of the second disbursement.
       ``(B) If the total amount approved with respect to such 
     loan is more than $150,000 but less than or equal to 
     $500,000--
       ``(i) the first disbursement with respect to such loan 
     shall consist of 20 percent of the total loan amount, or a 
     lesser percentage of the total loan amount if the 
     Administrator and the borrower agree on such a lesser 
     percentage;
       ``(ii) the second disbursement shall consist of 30 percent 
     of the loan amounts that remain after the first disbursement, 
     and shall be made when the borrower has produced satisfactory 
     receipts to demonstrate the proper use of 50 percent of the 
     first disbursement;
       ``(iii) the third disbursement shall consist of 25 percent 
     of the loan amounts that remain after the first and second 
     disbursements, and shall be made when the borrower has 
     produced satisfactory receipts to demonstrate the proper use 
     of the first disbursement and 50 percent of the second 
     disbursement; and
       ``(iv) the fourth disbursement shall consist of the loan 
     amounts that remain after the preceding disbursements, and 
     shall be made when the borrower has produced satisfactory 
     receipts to demonstrate the proper use of the first and 
     second disbursements and 50 percent of the third 
     disbursement.
       ``(C) If the total amount approved with respect to such 
     loan is more than $500,000--
       ``(i) the first disbursement with respect to such loan 
     shall consist of at least $100,000, or a lesser amount if the 
     Administrator and the borrower agree on such a lesser amount; 
     and
       ``(ii) the number of disbursements after the first, and the 
     amount of each such disbursement, shall be in the discretion 
     of the Administrator, but the amount of each such 
     disbursement shall be at least $100,000.''.

     SEC. 6. GRANT PROGRAM.

       Section 7(b) of the Small Business Act (15 U.S.C. 636(b)), 
     as amended by this Act, is further amended by inserting after 
     paragraph (9) the following:
       ``(10) Grants to disaster-affected small businesses.--
       ``(A) In general.--If the Administrator declares 
     eligibility for additional disaster assistance under 
     paragraph (9), the Administrator may make a grant, in an 
     amount not exceeding $100,000, to a small business concern 
     that--
       ``(i) is located in an area affected by the applicable 
     major disaster;
       ``(ii) submits to the Administrator a certification by the 
     owner of the concern that such owner intends to reestablish 
     the concern in the same county in which the concern was 
     originally located;
       ``(iii) has applied for, and was rejected for, a 
     conventional disaster assistance loan under this subsection; 
     and
       ``(iv) was in existence for at least 2 years before the 
     date on which the applicable disaster declaration was made.
       ``(B) Priority.--In making grants under this paragraph, the 
     Administrator shall give priority to a small business concern 
     that the Administrator determines is economically viable but 
     unable to meet short-term financial obligations.
       ``(C) Program level and authorization of appropriations.--
       ``(i) Program level.--The Administrator is authorized to 
     make $100,000,000 in grants under this paragraph for each of 
     fiscal years 2010 and 2011.
       ``(ii) Authorization of appropriations.--There are 
     authorized to be appropriated to the Administrator such sums 
     as may be necessary to carry out this paragraph.''.

     SEC. 7. REGIONAL DISASTER WORKING GROUPS.

       Section 40 of the Small Business Act (15 U.S.C. 657l) is 
     amended--
       (1) in subsection (a), in the matter preceding paragraph 
     (1), by striking ``or'' and inserting ``and'';
       (2) by redesignating subsection (d) as subsection (e); and
       (3) by inserting after subsection (c) the following:
       ``(d) Regional Disaster Working Groups.--In carrying out 
     the responsibilities pertaining to loan making activities 
     under subsection (a), the Administrator, acting through the 
     regional administrators of the regional offices of the 
     Administration, shall develop a disaster preparedness and 
     response plan for each region of the Administration. Each 
     such plan shall be developed in cooperation with Federal, 
     State, and local emergency response authorities and 
     representatives of businesses located in the region to which 
     such plan applies. Each such plan shall identify and include 
     a plan relating to the 3 disasters, natural or manmade, most 
     likely to occur in the region to which such plan applies.''.

     SEC. 8. OUTREACH GRANTS FOR LOAN APPLICANT ASSISTANCE.

       Section 7(b) of the Small Business Act (15 U.S.C. 636(b)), 
     as amended by this Act, is further amended by inserting after 
     paragraph (10) the following:
       ``(11) Outreach grants for loan applicant assistance.--
       ``(A) In general.--From amounts made available for 
     administrative expenses relating to activities under this 
     subsection, the Administrator is authorized to make grants to 
     the following:
       ``(i) A women's business center in an area affected by a 
     disaster.
       ``(ii) A small business development center in an area 
     affected by a disaster.
       ``(iii) A Veteran Business Outreach Center in an area 
     affected by a disaster.
       ``(iv) A chamber of commerce in an area affected by a 
     disaster.
       ``(B) Use of grant.--An entity specified under subparagraph 
     (A) shall use a grant received under this paragraph to 
     provide application preparation assistance to applicants for 
     a loan under this subsection.
       ``(C) Program level.--The Administrator is authorized to 
     make $50,000,000 in grants under this paragraph for each of 
     fiscal years 2010 and 2011.''.

     SEC. 9. HOMEOWNERS IMPACTED BY TOXIC DRYWALL.

       Section 7(b) of the Small Business Act (15 U.S.C. 636(b)), 
     as amended by this Act, is further amended by inserting after 
     paragraph (11) the following:
       ``(12) Homeowners impacted by toxic drywall.--The 
     Administrator may make a loan under this subsection to any 
     homeowner if the primary residence of such homeowner has been 
     adversely impacted by the installation of toxic drywall 
     manufactured in China. A loan under this paragraph may be 
     used only for the repair or replacement of such toxic 
     drywall.''.

     SEC. 10. AUTHORIZATION OF APPROPRIATIONS.

       Section 20 of the Small Business Act (15 U.S.C. 631 note) 
     is amended by inserting after subsection (e) the following:
       ``(f) Fiscal Years 2010 and 2011 With Respect to Section 
     7(b).--There is authorized to be appropriated such sums as 
     may be necessary for administrative expenses and loans under 
     section 7(b).''.

     SEC. 11. REGULATIONS.

       Except as otherwise provided in this Act or in amendments 
     made by this Act, after an opportunity for notice and 
     comment, but not later than 180 days after the date of the 
     enactment of this Act, the Administrator shall issue 
     regulations to carry out this Act and the amendments made by 
     this Act.

  The SPEAKER pro tempore. Pursuant to the rule, the gentlewoman from 
New York (Ms. Velazquez) and the gentleman from Missouri (Mr. Graves) 
each will control 20 minutes.
  The Chair recognizes the gentlewoman from New York.


                             General Leave

  Ms. VELAZQUEZ. Mr. Speaker, I ask unanimous consent that all Members 
may have 5 legislative days in which to revise and extend their remarks 
and include extraneous material on H.R. 3743, as amended.
  The SPEAKER pro tempore. Is there objection to the request of the 
gentlewoman from New York?
  There was no objection.
  Ms. VELAZQUEZ. Mr. Speaker, I yield myself such time as I may 
consume.
  I rise in support of H.R. 3743, the Small Business Disaster Readiness 
and Reform Act of 2009.
  The Small Business Administration's Disaster Loan Program is an 
important lifeline for businesses struggling to recover following 
natural disasters. Low-interest loans offered through the program help 
entrepreneurs rebuild their firms and get back on their feet. These 
loans also help small businesses avoid the economic shocks that often 
accompany disasters.
  While these programs are valuable in helping our communities recover 
from crises, they have not reached their full potential. Earlier this 
year, the Government Accountability Office examined the SBA's disaster 
recovery programs, including the agency's new measures following 
Hurricane Katrina. In July, the GAO testified to the Small Business 
Committee that the Small Business Administration has not done enough to 
prepare for major emergencies. The GAO's findings give cause for 
concern that the SBA will fall short of the needs of entrepreneurs 
during critical times.
  The legislation we are considering today will help the SBA better 
meet the needs of those recovering from natural disasters. This bill 
will improve how the SBA disburses assistance, ensuring small firms get 
help more quickly. This legislation will also require SBA to establish 
regional disaster working groups. These groups will develop localized 
disaster preparedness plans, putting the SBA in a better position to 
address the unique challenges facing small businesses recovering from 
disasters.
  Mr. Speaker, small businesses need access to capital to make payroll 
and carry on their daily operations. However, for firms recovering from 
natural disasters, finding an affordable loan can make all the 
difference between

[[Page H12473]]

staying open or closing forever. The legislation before us will ensure 
entrepreneurs can receive the help they need when times are tough.
  I commend Mr. Griffith, who is the sponsor of this bill, for his work 
on this important legislation.
  Mr. Speaker, I reserve the balance of my time.
  Mr. GRAVES. Mr. Speaker, I yield myself such time as I may consume.
  I rise today in support of H.R. 3743, the Small Business Disaster 
Readiness and Reform Act of 2009. I would like to thank the chairwoman 
and the gentleman from Alabama for working very hard, obviously, in the 
committee to the bring this bill to the floor.
  In 2008, Congress took action to address the inadequate response that 
the Small Business Administration had to the gulf hurricanes of 2005. 
The expectation was that those changes would alleviate many of the 
problems identified by small business owners, the Government 
Accountability Office, and the SBA found in response to Hurricane 
Katrina. However, GAO testified before the committee this summer and 
found that the SBA implementation of those changes had not been 
accomplished. That means that the SBA may not be able to respond 
adequately to a major disaster like Hurricane Katrina.
  A key element noted by GAO is the need for coordination. The bill 
requires the establishment of regional working groups to develop 
regional disaster plans in addition to the national plan that was 
required by Congress last year. This is sensible because some areas of 
the country are more prone to hurricanes while others are more prone to 
flooding and others to even things like wildfires. The national plan 
simply cannot cover with any specificity the range of disasters to 
which the SBA must respond. This should improve the overall emergency 
preparedness of the SBA.
  GAO and the committee remain concerned about the difficulty that 
small businesses have in filing applications for disaster loans. H.R. 
3743 recognizes that the SBA entrepreneur development partners can 
assist small business owners that need to file an application for a 
disaster loan and authorizes additional funds to these partners to 
provide such assistance to those seeking to recover from a disaster.
  Another primary focus of the committee's examination of the disaster 
loan process has been the disbursement process. Although changes were 
made in 2008, further refinements are needed to ensure that small 
businesses have access to funds needed to restore their operations and 
help their communities recover from the disaster.
  I would reiterate that this bill before us today builds on important 
work already done by Congress and will provide additional assurances 
that the SBA is capable of responding to the next natural or manmade 
disaster.
  Mr. Speaker, I reserve the balance of my time.
  Ms. VELAZQUEZ. Mr. Speaker, I continue to reserve the balance of my 
time.
  Mr. GRAVES. Mr. Speaker, I yield such time as he may consume to the 
gentleman from Illinois (Mr. Shimkus).
  (Mr. SHIMKUS asked and was given permission to revise and extend his 
remarks.)
  Mr. SHIMKUS. Mr. Speaker, I'm pleased to be down here on the 
suspension calendar to talk about the importance of the emergency 
response of small business centers. But you know what the real 
emergency response to small business should be is the assault on the 
workers that's coming because of this health care bill.
  Let me talk about the reports today:
  10.2 percent unemployment. ``The unemployment rate spiked to its 
highest level since 1983, much worse than expected as employers 
continue to trim jobs despite other signs of growth.''
  And do you know what the real catastrophe is? We are doing nothing 
here to help create jobs. In fact, what we're doing, based upon the 
Democratic bill, H.R. 3962, will destroy jobs. Here are some of the 
job-destruction aspects of this health care bill:
  Tax on jobs will increase unemployment. The Democrat bill would 
impose $150 billion in taxes on businesses who can't afford to finance 
their workers' health coverage. Guess what they'll do. They're going to 
lay off people to be able to afford the taxes to provide the few 
remaining employees jobs.
  The CBO confirmed this tax on jobs would reduce the hiring of low-
wage workers and could also lead to wage stagnation as wage 
compensation is diverted to comply with new Federal taxes and mandates. 
A model developed by the chief Obama adviser Christina Romer indicates 
that as many as 5.5 million jobs could be lost. That's not us. That's 
not the Small Business Committee. That's not the ranking member. That's 
the administration that's saying 5.5 million jobs could be lost.
  Hundreds of billions of dollars in taxes on businesses. In addition 
to the tax on jobs, H.R. 3962 includes nearly half a trillion dollars 
in other taxes, including a surtax more than half of whose intended 
targets are small businesses.
  We would be hoping that the Small Business Committee would come down 
here and say let's don't tax small business with this health care bill. 
Let's incentivize small businesses to provide health care coverage to 
their employees.
  That's what we'll do on the House version in the amendment offered, 
once the bill comes to the floor, is we're going to incentivize small 
businesses to stay in business, keep their employees, and provide 
health insurance coverage.
  In addition to the tax on jobs, the Democrat bill includes a half 
trillion dollars in other taxes including, as I said before, a surtax. 
More than half of those intended targets are small businesses.
  This is the disaster that we ought to be talking about here. This is 
a problem that we have with this Congress, the job-destroying plans 
coming to the floor of the House. Imposing a total of $729.5 billion in 
higher taxes on a struggling economy will be a recipe for years, if not 
decades, of prolonged stagnation.
  I thank the ranking member for yielding me the time.
  Mr. GRAVES. Mr. Speaker, I yield back the balance of my time.
  Ms. VELAZQUEZ. Mr. Speaker, I yield back the balance of my time.
  The SPEAKER pro tempore. The question is on the motion offered by the 
gentlewoman from New York (Ms. Velazquez) that the House suspend the 
rules and pass the bill, H.R. 3743, as amended.
  The question was taken; and (two-thirds being in the affirmative) the 
rules were suspended and the bill, as amended, was passed.
  A motion to reconsider was laid on the table.

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