[Congressional Record Volume 164, Number 158 (Tuesday, September 25, 2018)]
[House]
[Pages H8803-H8804]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




              7(a) REAL ESTATE APPRAISAL HARMONIZATION ACT

  Mr. CHABOT. Mr. Speaker, I move to suspend the rules and pass the 
bill (H.R. 6347) to adjust the real estate appraisal thresholds under 
the 7(a) program to bring them into line with the thresholds used by 
the Federal banking regulators, and for other purposes.
  The Clerk read the title of the bill.
  The text of the bill is as follows:

                               H.R. 6347

       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 ``7(a) Real Estate Appraisal 
     Harmonization Act''.

     SEC. 2. APPRAISAL THRESHOLDS.

       Section 7(a)(29) of the Small Business Act (15 U.S.C. 
     636(a)(29)) is amended--
       (1) by redesignating subparagraphs (A) and (B) as clauses 
     (i) and (ii), respectively, and adjusting the margins of such 
     clauses accordingly;
       (2) by striking ``With respect to'' and inserting the 
     following:
       ``(A) In general.--With respect to'';
       (3) in clause (i), as so redesignated, by striking ``for 
     more than $250,000'' and inserting ``, if such loan is in an 
     amount greater than the Federal banking regulator appraisal 
     threshold'';
       (4) in clause (ii), as so redesignated, by striking ``for 
     $250,000 or less'' and inserting ``, if such loan is in an 
     amount equal to or

[[Page H8804]]

     less than the Federal banking regulator appraisal 
     threshold''; and
       (5) by adding at the end the following:
       ``(B) Federal banking regulator appraisal threshold 
     defined.--For purposes of this paragraph, the term `Federal 
     banking regulator appraisal threshold' means the lesser of 
     the threshold amounts set by the Board of Governors of the 
     Federal Reserve System, the Comptroller of the Currency, and 
     the Federal Deposit Insurance Corporation for when a 
     federally related transaction that is a commercial real 
     estate transaction requires an appraisal prepared by a State 
     licensed or certified appraiser.''.

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


                             General Leave

  Mr. CHABOT. 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 the bill under consideration.
  The SPEAKER pro tempore. Is there objection to the request of the 
gentleman from Ohio?
  There was no objection.
  Mr. CHABOT. Mr. Speaker, I yield myself such time as I may consume.
  Mr. Speaker, similar to the SBA's 504/CDC loan program, the SBA's 
7(a) loan program assists small businesses that have a business plan in 
place for success but do not have the ability to obtain credit 
elsewhere. Through a partnership with financial institutions, the SBA 
provides a government guarantee to help the small business grow and 
create jobs. Importantly, this program has been running on zero cost to 
the American taxpayers for years.
  While the economy has been improving, conflicting Federal rules and 
regulations often present uncertainty and confusion for small 
businesses and those within the 7(a) loan program.
  When an SBA 7(a) loan is used in a commercial real estate 
transaction, a formal State licensed or certified appraisal is 
statutorily required on all transactions above $250,000. However, the 
value set by Federal financial regulators has recently been increased 
from $250,000 to $500,000. To provide clarity for small businesses, 
H.R. 6347 modernizes and mirrors the SBA's commercial real estate 
appraisal threshold with the value set by Federal financial regulators.
  Similar to H.R. 6348, H.R. 6347 does not provide an exact dollar 
threshold. Rather, it ties the SBA's 7(a) threshold to the value set by 
Federal financial regulators. This benchmark provision will prevent 
conflict as the threshold value is updated in the future.
  I would like to thank Mr. Evans and Mr. Curtis for working in a 
bipartisan manner to find a solution to this problem that is impacting 
small businesses. The bill has broad bipartisan support.
  Mr. Speaker, I urge my colleagues to vote ``yes'' on H.R. 6347, and I 
reserve the balance of my time.
  Ms. VELAZQUEZ. Mr. Speaker, I yield myself such time as I may 
consume.
  Mr. Speaker, I rise in support of H.R. 6347, the 7(a) Real Estate 
Harmonization Act, which updates SBA's outdated real estate appraisal 
threshold for the 7(a) loan guarantee program.
  The 7(a) loan program, the SBA's flagship lending product, is a vital 
source of capital for thousands of small businesses unable to secure 
financing through traditional lending. Today's bill brings the 7(a) 
program's real estate appraisal threshold in line with other Federal 
banking regulators, namely the Fed, OCC, and FDIC. In doing so, it 
eliminates the burden lenders currently face in having to meet two 
different standards. I want to thank the gentleman from Pennsylvania 
(Mr. Evans) for his leadership on this important issue.
  Mr. Speaker, I urge Members to support this bipartisan piece of 
legislation, and I reserve the balance of my time.
  Mr. CHABOT. Mr. Speaker, I reserve the balance of my time.
  Ms. VELAZQUEZ. Mr. Speaker, I yield 5 minutes to the gentleman from 
Pennsylvania (Mr. Evans), who is the sponsor of the bill.
  Mr. EVANS. Mr. Speaker, I thank the chairman and the ranking member 
for their support of this bill.
  As I mentioned earlier, this bill is important for modernization and 
moving toward the future. In the city of Philadelphia, we have a lot of 
opportunities. It is most important that we rise in competitiveness 
from where we are today. As the ranking member has stated very clearly, 
this again just makes the opportunities more competitive.
  I think it is most important in this environment today that we are 
sensitive to small businesses because they are the backbone of our 
future. It is important to understand that in a city like Philadelphia, 
which has 26 percent poverty--one of the largest major cities in this 
country--we need to add this to the toolbox. The importance of growing 
businesses, particularly small businesses, is extremely important to us 
all.
  So I stand here today and join with my colleagues and ask that we 
support this legislation that will be very important in the toolbox of 
small businesses.
  Ms. VELAZQUEZ. Mr. Speaker, I yield myself the balance of my time.
  This past spring, Federal banking regulators updated their threshold 
level for when a State licensed or certified appraisal is required, 
raising it to $500,000. In order to remain consistent with the rest of 
the market, SBA's levels should match the market. This bill does this 
by harmonizing the real estate appraisal threshold for the SBA's 7(a) 
program with the rest of the marketplace.
  Mr. Speaker, I urge Members to support this bill, and I yield back 
the balance of my time.
  Mr. CHABOT. Mr. Speaker, I yield myself the balance of my time.
  Mr. Speaker, I would first like to commend the gentleman from 
Pennsylvania (Mr. Evans) for his leadership on this bill.
  Small businesses do not employ an army of tax and accounting 
specialists. All too often, the small business owner must sacrifice 
time and energy away from growing his or her business to comply with 
Federal rules and regulations. While we are making progress on reducing 
regulations, at times, Federal rules conflict.
  As we have heard today, H.R. 6347 aims to reduce the confusion that 
exists for small businesses that utilize the Small Business 
Administration's 7(a) loan program when it comes to the commercial real 
estate appraisal threshold.
  Mr. Speaker, I urge my colleagues to support the bipartisan updates 
proposed in this measure, and I yield back the balance of my time.
  The SPEAKER pro tempore (Mr. Emmer). The question is on the motion 
offered by the gentleman from Ohio (Mr. Chabot) that the House suspend 
the rules and pass the bill, H.R. 6347.
  The question was taken; and (two-thirds being in the affirmative) the 
rules were suspended and the bill was passed.
  A motion to reconsider was laid on the table.

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