[Congressional Record Volume 166, Number 204 (Thursday, December 3, 2020)]
[House]
[Pages H6068-H6072]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




                    COMMUNITY ADVANTAGE LOAN PROGRAM

  Ms. VELAZQUEZ. Mr. Speaker, I move to suspend the rules and pass the 
bill (H.R. 7903) to amend the Small Business Act to establish the 
Community Advantage Loan Program, as amended.
  The Clerk read the title of the bill.
  The text of the bill is as follows:

                               H.R. 7903

       Be it enacted by the Senate and House of Representatives of 
     the United States of America in Congress assembled,

     SECTION 1. COMMUNITY ADVANTAGE LOAN PROGRAM.

       Section 7(a) of the Small Business Act (15 U.S.C. 636(a)) 
     is amended by adding at the end the following:
       ``(37) Community advantage loan program.--
       ``(A) Purposes.--The purposes of the Community Advantage 
     Loan Program are--
       ``(i) to create a mission-oriented loan guarantee program 
     that builds on the demonstrated success of the Community 
     Advantage Pilot Program of the Administration, as established 
     in 2011, to reach more underserved small business concerns;
       ``(ii) to increase lending to small business concerns in 
     underserved and rural markets, including veterans and members 
     of the military community, small business concerns owned and 
     controlled by socially and economically disadvantaged 
     individuals, women, and startups;
       ``(iii) to ensure that the program under this subsection 
     (in this paragraph referred to as the `7(a) loan program') is 
     more inclusive and more broadly meets congressional intent to 
     reach borrowers who are unable to get credit elsewhere on 
     reasonable terms and conditions;
       ``(iv) to help underserved small business concerns become 
     bankable by utilizing the small-dollar financing and business 
     support experience of mission-oriented lenders;
       ``(v) to allow certain mission-oriented lenders, primarily 
     nonprofit financial intermediaries focused on economic 
     development in underserved markets, to access guarantees for 
     loans under this subsection (in this paragraph referred to as 
     `7(a) loans') of not more than $250,000 and provide 
     management and technical assistance to small business 
     concerns as needed;
       ``(vi) to provide certainty for the lending partners that 
     make loans under this subsection and to attract new lenders; 
     and
       ``(vii) to encourage collaboration between mission-oriented 
     and conventional lenders under this subsection in order to 
     support underserved small business concerns.
       ``(B) Definitions.--In this paragraph--
       ``(i) the term `covered institution' means--

       ``(I) a development company, as defined in section 103 of 
     the Small Business Investment Act of 1958 (15 U.S.C. 662), 
     participating in the 504 Loan Guaranty program established 
     under title V of such Act (15 U.S.C. 695 et seq.);
       ``(II) a nonprofit intermediary, as defined in subsection 
     (m)(12), participating in the microloan program under 
     subsection (m);
       ``(III) a non-Federally regulated entity certified as a 
     community development financial institution by the Community 
     Development Financial Institutions Fund established under 
     section 104(a) of the Riegle Community Development and 
     Regulatory Improvement Act of 1994 (12 U.S.C. 4703(a)); and
       ``(IV) an eligible intermediary, as defined in subsection 
     (l)(1), as in effect on the day before the date of enactment 
     of this paragraph, that participated in the Intermediary 
     Lending Pilot Program established under subsection (l)(2);

       ``(ii) the term `existing business' means a small business 
     concern that has been in existence for not less than 2 years 
     on the date on which a loan is made to the small business 
     concern under the program;
       ``(iii) the term `new business' means a small business 
     concern that has been existence for not more than 2 years on 
     the date on which a loan is made to the small business 
     concern under the program;
       ``(iv) the term `program' means the Community Advantage 
     Loan Program established under subparagraph (C);
       ``(v) the term `Reservist' means a member of a reserve 
     component of the Armed Forces named in section 10101 of title 
     10, United States Code;
       ``(vi) the term `rural area' means any county that the 
     Bureau of the Census has defined as mostly rural or 
     completely rural in the most recent decennial census;
       ``(vii) the term `service-connected' has the meaning given 
     the term in section 101(16) of title 38, United States Code;
       ``(viii) the term `small business concern in an underserved 
     market' means a small business concern--

       ``(I) that is located in--

       ``(aa) a low- to moderate-income community;
       ``(bb) a HUBZone;
       ``(cc) a community that has been designated as an 
     empowerment zone or an enterprise community under section 
     1391 of the Internal Revenue Code of 1986;
       ``(dd) a community that has been designated as a promise 
     zone by the Secretary of Housing and Urban Development;
       ``(ee) a community that has been designated as a qualified 
     opportunity zone under section 1400Z-1 of the Internal 
     Revenue Code of 1986;
       ``(ff) a rural area; or
       ``(gg) any area for which a disaster declaration or 
     determination described in subparagraphs (A), (B), (C), or 
     (E) of subsection (b)(2) has been made that has not 
     terminated or expired more than 2 years before the date (or 
     later, as determined by the Administrator) on which a loan is 
     made to such concern under the program;

       ``(II) for which more than 50 percent of the employees 
     reside in a low- or moderate-income community;
       ``(III) that is a startup or new business;
       ``(IV) owned and controlled by socially and economically 
     disadvantaged individuals, including Black Americans, 
     Hispanic Americans, Native Americans, Asian Pacific 
     Americans, and other minorities;
       ``(V) owned and controlled by women;
       ``(VI) owned and controlled by veterans;
       ``(VII) owned and controlled by service-disabled veterans;
       ``(VIII) not less than 51 percent owned and controlled by 
     one or more--

       ``(aa) members of the Armed Forces participating in the 
     Transition Assistance Program of the Department of Defense;
       ``(bb) Reservists;
       ``(cc) spouses of veterans, members of the Armed Forces, or 
     Reservists; or
       ``(dd) surviving spouses of veterans who died on active 
     duty or as a result of a service-connected disability; or

       ``(IX) that is eligible to receive a veterans advantage 
     loan;

       ``(ix) the term `small business concern owned and 
     controlled by socially and economically disadvantaged 
     individuals' has the meaning given the term in section 
     8(d)(3)(C);
       ``(x) the term `startup' means a business that has not yet 
     opened; and
       ``(xi) the term `veterans advantage loan' means a loan made 
     to a small business concern under this subsection that is 
     eligible for a waiver of the guarantee fee under paragraph 
     (18) or the yearly fee under paragraph (23) because the small 
     business concern is a concern described in subclause (VI), 
     (VII), or (VIII) of clause (viii).
       ``(C) Establishment.--There is established a Community 
     Advantage Loan Program under which the Administration may 
     guarantee loans made by covered institutions under this 
     subsection, including loans made to small business concerns 
     in underserved markets.
       ``(D) Program levels.--In each of fiscal years 2021 through 
     2025, not more than 10 percent of the number of loans 
     guaranteed under this subsection may be guaranteed under the 
     program.
       ``(E) New lenders.--
       ``(i) Fiscal years 2021 and 2022.--In each of fiscal years 
     2021 and 2022--

[[Page H6069]]

       ``(I) not more than 150 covered institutions shall 
     participate in the program; and
       ``(II) the Administrator shall allow for new applicants and 
     give priority to applications submitted by any covered 
     institution that is located in an area with insufficient 
     lending under the program.

       ``(ii) Fiscal years 2023, 2024, and 2025.--

       ``(I) In general.--In each of fiscal years 2023, 2024, and 
     2025--

       ``(aa) except as provided in subclause (II), not more than 
     175 covered institutions shall participate in the program; 
     and
       ``(bb) the Administrator shall allow for new applicants and 
     give priority to applications submitted by any covered 
     institution that is located in an area with insufficient 
     lending under the program.

       ``(II) Exception for fiscal year 2025.--In fiscal year 
     2025, not more than 200 covered institutions may participate 
     in the program if--

       ``(aa) after reviewing the report under subparagraph 
     (M)(iii), the Administrator determines that not more than 200 
     covered institutions may participate in the program;
       ``(bb) the Administrator notifies Congress in writing of 
     the determination of the Administrator under item (aa); and
       ``(cc) not later than July 30, 2024, the Administrator 
     notifies the public of the determination of the Administrator 
     under item (aa).
       ``(F) Grandfathering of existing lenders.--Any covered 
     institution that participated in the Community Advantage 
     Pilot Program of the Administration and is in good standing 
     on the day before the date of enactment of this paragraph--
       ``(i) shall retain designation in the program; and
       ``(ii) shall not be required to submit an application to 
     participate in the program.
       ``(G) Requirement to make loans to underserved markets.--
     Not less than 75 percent of loans made by a covered 
     institution under the program shall consist of loans made to 
     small business concerns in underserved markets.
       ``(H) Maximum loan amount.--
       ``(i) In general.--Except as provided in clause (ii), the 
     maximum loan amount for a loan guaranteed under the program 
     is $250,000.
       ``(ii) Exception.--

       ``(I) In general.--The Administration may, in the 
     discretion of the Administration, approve a guarantee of a 
     loan under the program that is more than $250,000 and not 
     more than $350,000.
       ``(II) Notification.--Not later than 2 days after approving 
     the guarantee of a loan under subclause (I), the 
     Administration shall provide notification of the approval to 
     the covered institution making the loan.

       ``(I) Interest rates.--
       ``(i) In general.--Except as provided in clause (ii), the 
     maximum allowable interest rate prescribed by the 
     Administration on any financing made on a deferred basis 
     pursuant to the program shall not exceed the maximum 
     allowable interest rate in effect on September 1, 2018.
       ``(ii) Modification.--The Administration shall not modify 
     the maximum allowable interest rate described in clause (i) 
     unless the Administration provides the public with an 
     opportunity to comment for a period of not less than 180 days 
     before implementing the modified interest rate.
       ``(J) Training and technical assistance.--The 
     Administration--
       ``(i) shall in person and online, provide upfront and 
     ongoing training and technical assistance for covered 
     institutions making loans under the program in order to 
     support prudent lending standards and improve the interface 
     between the covered institutions and the Administration;
       ``(ii) shall ensure that the training and technical 
     assistance described in clause (i) is provided for free or at 
     a low-cost; and
       ``(iii) may enter into a contract to provide the training 
     or technical assistance described in clause (i) with an 
     organization with expertise in lending under this subsection, 
     mission-oriented lending, and lending to underserved markets.
       ``(K) Delegated authority.--A covered institution is not 
     eligible to receive delegated authority from the 
     Administration under the program until the covered 
     institution makes not less than 7 loans under the program.
       ``(L) Regulations.--
       ``(i) In general.--Not later than 180 days after the date 
     of enactment of this paragraph and in accordance with the 
     notice and comment procedures under section 553 of title 5, 
     United States Code, the Administrator shall promulgate 
     regulations to carry out the program, which shall--

       ``(I) outline the requirements for participation by covered 
     institutions in the program;
       ``(II) define performance metrics for covered institutions 
     participating in the program for the first time, which are 
     required to be met in order to continue participating in the 
     program;
       ``(III) determine the credit score of a small business 
     concern under which the Administration is required to 
     underwrite a loan provided to the small business concern 
     under the program and the loan may not be made using the 
     delegated authority of a covered institution;
       ``(IV) require each covered institution that sells loans 
     made under the program on the secondary market to establish a 
     loan loss reserve fund, which--

       ``(aa) with respect to covered institutions in good 
     standing, including the covered institutions described in 
     subparagraph (F), shall be maintained at a level equal to 3 
     percent of the outstanding guaranteed portion of the loans; 
     and
       ``(bb) with respect to any other covered institution, shall 
     be maintained at a level equal to 5 percent of the 
     outstanding guaranteed portion of the loans; and

       ``(V) allow the Administrator to require additional amounts 
     to be deposited into a loan loss reserve fund established by 
     a covered institution under subclause (IV) based on the risk 
     characteristics or performance of the covered institution and 
     the loan portfolio of the covered institution.

       ``(ii) Pilot program.--

       ``(I) Reversion.--Beginning on the date of enactment of 
     this paragraph and ending on the day before the date on which 
     the regulations promulgated by the Administrator under clause 
     (i) take effect, the Administrator may only carry out the 
     Community Advantage Pilot Program of the Administration based 
     on applicable program guidelines, requirements, and other 
     policy in effect on September 1, 2018, except that the 
     definition of underserved market shall include--

       ``(aa) a community and an area described in items (ee) and 
     (ff), respectively, of subparagraph (B)(viii)(I); and
       ``(bb) small business concerns described in clauses (IV) 
     and (V) of subparagraph (B)(viii).

       ``(II) Termination.--Beginning on the date on which the 
     regulations promulgated by the Administrator under clause (i) 
     take effect, the Administrator may not carry out the 
     Community Advantage Pilot Program of the Administration.

       ``(M) Reporting.--
       ``(i) Weekly reports.--

       ``(I) In general.--The Administration shall report on the 
     website of the Administration, as part of the weekly reports 
     on lending approvals under this subsection--

       ``(aa) on and after the date of enactment of this paragraph 
     until the date on which the regulations promulgated under 
     subparagraph (L)(i) take effect, the number and dollar amount 
     of loans guaranteed under the Community Advantage Pilot 
     Program of the Administration; and
       ``(bb) on and after the date on which the Administration 
     begins to approve loans under the program, the number and 
     dollar amount of loans guaranteed under the program.

       ``(II) Separate accounting.--The number and dollar amount 
     of loans reported in a weekly report under subclause (I) for 
     loans guaranteed under the Community Advantage Pilot Program 
     of the Administration and under the program shall include a 
     breakdown by the categories of race, ethnicity, and gender of 
     the owners of the small business concerns.

       ``(ii) Annual reports.--

       ``(I) In general.--For each of the first 5 fiscal years in 
     which the program is in effect, the Administration shall 
     submit to the Committee on Small Business and 
     Entrepreneurship of the Senate and the Committee on Small 
     Business of the House of Representatives, and make publicly 
     available on the internet, information about loans provided 
     under the program and under the Community Advantage Pilot 
     Program of the Administration.
       ``(II) Contents.--Each report submitted and made publicly 
     available under subclause (I) shall include--

       ``(aa) the number and dollar amounts of loans provided to 
     small business concerns under the program and under the 
     Community Advantage Pilot Program of the Administration, 
     including a breakdown by--
       ``(AA) the gender of the owners of the small business 
     concern;
       ``(BB) the race and ethnicity of the owners of the small 
     business concern, disaggregated in a manner that captures all 
     the racial groups specified in the American Community Survey 
     conducted by the Bureau of the Census;
       ``(CC) whether the small business concern is located in an 
     urban or rural area; and
       ``(DD) whether the small business concern is a startup, an 
     existing business, or a new business, as provided in the 
     weekly reports on lending approvals under this subsection;
       ``(bb) the proportion of loans described in item (aa) 
     compared to--
       ``(AA) other 7(a) loans of any amount;
       ``(BB) other 7(a) loans of similar amounts;
       ``(CC) express loans provided under paragraph (31) of 
     similar amounts; and
       ``(DD) other 7(a) loans of similar amounts provided to 
     small business concerns in underserved markets;
       ``(cc) a comparison of the number and dollar amounts of 
     loans provided to small business concerns under the program, 
     under the Community Advantage Pilot Program of the 
     Administration, and under each category of loans described in 
     item (bb), broken down by--
       ``(AA) loans of not more than $50,000;
       ``(BB) loans of more than $50,000 and not more than 
     $150,000;
       ``(CC) loans of more than $150,000 and not more than 
     $250,000; and
       ``(DD) loans of more than $250,000 and not more than 
     $350,000;
       ``(dd) the number and dollar amounts of loans provided to 
     small business concerns under the program and under the 
     Community Advantage Pilot Program of the Administration by 
     State, and the jobs created or retained within each State;
       ``(ee) with respect to loans provided to small business 
     concerns under the program

[[Page H6070]]

     and under the Community Advantage Pilot Program of the 
     Administration--
       ``(AA) the performance of the loans provided by each type 
     of covered institution;
       ``(BB) the performance of the loans broken down by loan 
     size;
       ``(CC) the performance of the loans broken down by whether 
     the credit score of the borrower is above, below, or equal to 
     140;
       ``(DD) the predictive purchase rate of the loans;
       ``(EE) the early default rate of the loans;
       ``(FF) the 12-month default rate of the loans;
       ``(GG) the cumulative default rate for the loans for the 5-
     year period preceding the report;
       ``(HH) the charge-off rates of the loans;
       ``(II) the charge-off rates as a percent of the unpaid 
     principal balance as in table 9 of the annual budget 
     submitted by the Administration; and
       ``(JJ) the purchase rates as a percent of the unpaid 
     principal balance as in table 8 of the annual budget 
     submitted by the Administration;
       ``(ff) a list of covered institutions participating in the 
     program and the Community Advantage Pilot Program of the 
     Administration, including--
       ``(AA) the name, location, and contact information, such as 
     the website and telephone number, of each covered 
     institution; and
       ``(BB) a breakdown by the number and dollar amount of the 
     loans approved for small business concerns; and
       ``(gg) the benchmarks established by the working group 
     under subparagraph (N)(i).

       ``(III) Timing.--An annual report required under this 
     clause shall--

       ``(aa) be submitted and made publicly available not later 
     than October 15 of each year; and
       ``(bb) cover the lending activity for the fiscal year that 
     ended on September 30 of that same year.
       ``(iii) GAO report.--Not later than 3 years after the date 
     of enactment of this paragraph, the Comptroller General of 
     the United States shall submit to the Administrator, the 
     Committee on Small Business and Entrepreneurship of the 
     Senate, and the Committee on Small Business of the House of 
     Representatives a report--

       ``(I) assessing--

       ``(aa) the extent to which the program fulfills the 
     requirements of this paragraph; and
       ``(bb) the performance of covered institutions 
     participating in the program; and

       ``(II) providing recommendations on the administration of 
     the program and the findings under items (aa) and (bb) of 
     subclause (I).

       ``(N) Working group.--
       ``(i) In general.--Not later than 90 days after the date of 
     enactment of this paragraph, the Administrator shall 
     establish a Community Advantage Working Group, which shall--

       ``(I) include--

       ``(aa) a geographically diverse representation of members 
     from among covered institutions participating in the program; 
     and
       ``(bb) representatives from the Office of Capital Access of 
     the Administration, including the Office of Credit Risk 
     Management, the Office of Financial Assistance, and the 
     Office of Economic Opportunity;

       ``(II) develop recommendations on how the Administration 
     can effectively manage, support, and promote the program and 
     the mission of the program;
       ``(III) establish metrics of success and benchmarks that 
     reflect the mission and population served by covered 
     institutions under the program, which the Administration 
     shall use to evaluate the performance of those covered 
     institutions; and
       ``(IV) institute regular and sustainable systems of 
     communication between the Administration and covered 
     institutions participating in the program.

       ``(ii) Report.--Not later than 180 days after the date of 
     enactment of this paragraph, the Administrator shall submit 
     to the Committee on Small Business and Entrepreneurship of 
     the Senate and the Committee on Small Business of the House 
     of Representatives a report that includes--

       ``(I) the recommendations of the Community Advantage 
     Working Group established under clause (i); and
       ``(II) a recommended plan and timeline for implementation 
     of those recommendations.

       ``(O) Termination.--The authority to carry out the program 
     under this paragraph shall terminate on September 30, 
     2025.''.

  The SPEAKER pro tempore. Pursuant to the rule, the gentlewoman from 
New York (Ms. Velazquez) and the gentleman from Ohio (Mr. Chabot) 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 the measure under consideration.
  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.
  Mr. Speaker, before I begin, I would like to take a moment to 
recognize my good friend and colleague, Ranking Member Chabot. Mr. 
Chabot has led this committee with me for years. Together, we have 
worked in a bipartisan manner to pass legislation that will help 
entrepreneurs across the country launch and grow their small 
businesses.
  Steve has been an absolute pleasure to work with. Not only is he 
results-oriented, but he is strongly committed to bipartisanship and 
finding common ground. While we do not always agree, Ranking Member 
Chabot has always respected our views and the need to work together to 
do the right thing for America's small businesses.
  The bills we are bringing to the floor today represent our 
committee's long tradition of collaboration.
  Turning to the legislation now, I rise in support of the bill before 
us today, H.R. 7903, which would codify the SBA's Community Advantage 
Loan Program.
  Initially launched in 2011 as a pilot program, Community Advantage 
provides 7(a) loan guarantees to nonprofit lenders to make loans up to 
$250,000 to small businesses in underserved markets.
  As we all know, businesses in underserved areas have historically 
struggled to access capital through conventional credit markets. This 
is particularly true for minority-owned small businesses.
  According to the Minority Business Development Agency, the loan 
denial rates for minority-owned firms were about three times higher 
compared to those of nonminority-owned firms with gross receipts under 
$500,000.
  To that end, the Community Advantage program partners with SBA's 
certified development companies, SBA microlenders, and community 
development financial institutions, or CDFIs, all of which have deep 
relationships in the neighborhoods and can expand access to capital in 
these areas.
  The Community Advantage program reaches significantly more women and 
minorities than traditional 7(a) loan programs, which will be critical 
to helping these groups that were hit especially hard by the COVID-19 
pandemic.
  To fill gaps in lending, it is imperative that we empower the 
community lenders with the strongest relationships in these areas. We 
can accomplish this by passing the bill before us today to bring 
stability and long-needed recognition to a program that has 
successfully delivered over $770 million in capital since its 
inception.
  I thank Ms. Chu and Mr. Spano for working in a bipartisan manner on 
this important legislation.
  Mr. Speaker, I recommend a ``yes'' vote to all of my colleagues in 
the House, and I reserve the balance of my time.
  Mr. CHABOT. Mr. Speaker, I yield myself such time as I may consume.
  I rise in support of H.R. 7903, as amended. This is a bill to improve 
and authorize the SBA's Community Advantage Loan Program for 5 years.
  Mr. Speaker, before I get into the business of the day, I would like 
to mention that, with the passage of these four bills today, our 
committee has produced 35 individual bipartisan pieces of legislation 
that have passed the House just this Congress. We have had similar 
numbers the previous two Congresses, as well. That is an uncommon 
occurrence in a time of divided government.
  The reason we have been so successful in improving the programs that 
benefit America's more than 30 million small businesses is the 
leadership and the bipartisanship of our chairwoman, Nydia Velazquez.
  Now, this is my swan song, so to speak, here as the ranking member of 
the committee, as I am term-limited and, therefore, unable to continue 
serving in that role. I have had the pleasure of being on the Small 
Business Committee--I am on the Foreign Affairs Committee and Judiciary 
Committee, as well--for 12 terms now, representing Ohio's First 
Congressional District. I have also been fortunate to have been the 
ranking member two of those terms and the chair of the committee two of 
those terms, as well. Again, that is why I am term-limited.
  In each of those terms that I have spent in a leadership position on 
the committee, my counterpart was Chairwoman or Ranking Member 
Velazquez. She has remained a valued

[[Page H6071]]

friend and a reliable partner to do the things that we needed to do to 
help the Nation's small businesses. I sincerely thank her for the 
partnership that we have forged over the years.
  We share a common bond of wanting to do everything in our power to 
help America's small businesses, and we have consistently been able to 
put partisan politics aside and work together to support that goal. So, 
again, I thank her for her willingness to work with my staff and me 
over those years, and I hope and trust that they will be able to 
continue that relationship with my replacement, and I think that will 
happen.
  Finally, I mentioned staff before. I want to thank the longtime 
Democratic Small Business Committee staffers Melissa Jung, Justin 
Pelletier, Naveen Parmar, and Ellen Harrington for their extraordinary 
commitment to bipartisanship over the years, regardless of who was 
chair or who was the ranking member. Again, on that committee, we have 
worked together for many years now.
  Now, to the business at hand. When traditional and conventional 
lending is out of reach for the Nation's smallest businesses, they have 
the opportunity to turn to a number of the SBA's government guaranteed 
lending programs.

  For approximately 10 years, the SBA has been operating a Community 
Advantage pilot program that combines access to capital and technical 
assistance. The legislation before us today makes structural changes 
and improvements in the program and authorizes it for 5 years.
  With oversight and reporting requirements in place, this program will 
continue to provide access to capital and consistency to the Nation's 
job creators who truly need assistance.
  I thank the gentleman from Florida (Mr. Spano) and the gentlewoman 
from California (Ms. Judy Chu) for working in a bipartisan manner on 
behalf of the Nation's smallest firms. They have both worked together 
on this and previous legislation, both of them, in the spirit of 
bipartisanship on that committee.
  Mr. Speaker, I urge all of my colleagues to support H.R. 7903, which 
was favorably reported out of the committee via voice vote, and I 
reserve the balance of my time.
  Ms. VELAZQUEZ. Mr. Speaker, I yield such time as she may consume to 
the gentlewoman from California (Ms. Judy Chu), the sponsor of the bill 
and the chair of the Subcommittee on Investigations, Oversight and 
Regulations.
  Ms. JUDY CHU of California. Mr. Speaker, I rise today in strong 
support of my bill, H.R. 7903, which would authorize the Community 
Advantage Loan Program for 5 years. To help our struggling economy, we 
need a bipartisan bill that gets money to those who need it.
  This bill, which I am proud to have introduced with my colleague, 
Congressman Ross Spano, does just that by providing statutory 
authorization to the Community Advantage program, already a proven and 
successful pilot program.
  Thanks to Community Advantage, underserved small businesses, which 
typically have the hardest time accessing loans, can gain access to 
affordable financing and technical assistance from mission-based, 
primarily nonprofit lenders through SBA's 7(a) loan guarantee. That 
means more money in more communities to keep our businesses operating. 
This is something we need now more than ever.
  The Community Advantage program was first established almost 10 years 
ago as a pilot at the Small Business Administration with the goal of 
delivering capital to the hard-to-reach businesses that need under 
$250,000 in financing to grow. Since 2011, the program has facilitated 
over $850 million in loans averaging $140,000 each. Compare that to the 
average 7(a) loan of $530,000, and it is clear Community Advantage is 
meeting a small business need that is unfilled by the traditional 7(a) 
program.
  It has also made a big impact in my district, where businesses have 
received nearly $10 million in Community Advantage loans. That includes 
businesses like Unincorporated Coffee Roasters in Altadena, California, 
which received a Community Advantage loan last summer. This business 
had been in operation for under 2 years, but their Community Advantage 
loan allowed them to expand into the space next door and open a second 
company to roast their own coffee beans for the wholesale market.

                              {time}  1515

  They have even added jobs and continued to grow during the pandemic. 
That is what can happen when we make small business loans just a little 
less difficult to access. And it is an experience shared by businesses 
across the country.
  Last year, I chaired a hearing in the Subcommittee on Investigations, 
Oversight and Regulations to examine the Community Advantage program. 
We heard from borrowers and lenders about the ways that Community 
Advantage has closed the credit gap for underserved businesses.
  Because of their focus on economic and community development, the 
mission-based lenders that facilitate Community Advantage loans can 
leverage their strong relationships within the community to provide 
accessibility, guidance, and assistance to the businesses that too 
often find themselves on the margins without the ability to access 
capital from traditional banks. As a result, Community Advantage is 
able to reach far more businesses owned by people of color, women, and 
veterans than traditional 7(a) loans.
  This is a proven model, and we can see further evidence in the 
response to the COVID-19 pandemic. When the Paycheck Protection 
Program, or PPP, first launched at the start of April, traditional 
lenders prioritized their largest and longstanding clients, making it 
difficult for underserved businesses to even submit an application for 
assistance.
  To address this problem, Congress established a set-aside lending 
authority for community financial institutions like certified 
development companies, microloan intermediaries, and community 
development financial institutions, many of which are already certified 
Community Advantage lenders. The result was a success, as these 
nontraditional lenders were able to reach the underserved businesses 
and, together, deliver over 141,000 PPP loans totaling more than $8.5 
billion.
  Now it is time to build on that success. This legislation before us 
today includes measures, with bipartisan agreement, to make the program 
even stronger. It will expand the definition of ``underserved 
businesses'' to explicitly include those owned by people of color and 
those located in declared disaster areas, and it will increase the 
percentage of loans that lenders must make in underserved markets from 
60 to 75 percent of their portfolios. It will also allow SBA to make 
loans up to $350,000 on a case-by-case basis.
  With these improvements and the long-term certainty afforded by 
statutory authorization, this bill will make the Community Advantage 
program an even more powerful tool for closing the credit gap and 
delivering affordable capital to more small businesses.
  With a long and arduous economic recovery before us, this bill will 
help countless small businesses rebuild, and it will help them to start 
anew as we recover from the coronavirus pandemic.
  Mr. Speaker, I thank Congressman Spano for his partnership and 
Chairwoman Velazquez and Ranking Member Chabot for their strong 
support. I also thank the Community Advantage lenders and borrowers 
whose success and testimony over the years have powerfully made the 
case for Congress to pass this legislation to authorize the program.
  Mr. Speaker, I urge my colleagues to vote ``yes'' on H.R. 7903.
  Mr. CHABOT. Mr. Speaker, I yield such time as he may consume to the 
gentleman from Florida (Mr. Spano).
  Mr. Speaker, I thank the gentleman for his service in this body. He 
has introduced and supported a number of pieces of legislation and has 
worked very hard in his leadership position as ranking member of the 
Oversight, Investigations and Regulations Subcommittee. I thank him for 
his service here.
  Mr. SPANO. Mr. Speaker, I thank the gentleman from Ohio (Mr. Chabot) 
for those kind comments. I appreciate that very much.
  I rise today in support of a bill I am proud to sponsor, H.R. 7903, 
legislation to improve and authorize the SBA's Community Advantage Loan 
Program.

[[Page H6072]]

  Small businesses are the driver of our communities, and now, more 
than ever, it is imperative for Congress to support them.
  In my home State of Florida, there are over 2.5 million small 
businesses employing over 3.5 million Floridians.
  As a former small business owner myself and as someone who will be a 
small business owner again very, very soon, I understand the sacrifice 
many small business owners make to keep their doors open and to meet 
their payrolls. I know the challenges that they face and the grit that 
it takes for them to persevere and the impact that they have on our 
communities.
  Among these challenges for many small businesses is acquiring the 
capital that is necessary to finance their operations.
  Many of the tools available at the SBA strive to increase access to 
capital for small businesses that are unable to receive it through 
conventional and traditional lending markets. One of these tools to 
support small businesses is the SBA's Community Advantage Loan Program, 
which was launched as a pilot program to assist small businesses in 
historically underserved and rural areas. It targets assistance to 
veteran-owned businesses, women-owned businesses, startups, and 
underserved minority communities, all key job creators. The combination 
of financial and technical assistance has made the program a proven 
game changer for many small businesses.
  Mr. Speaker, I thank the gentlewoman from California (Ms. Judy Chu) 
for her bipartisan leadership in providing strategic improvements to 
this program and to move it from a pilot program to an authorized 
program for the next 5 years.
  The improvements included in H.R. 7903 will ensure the program serves 
businesses truly in need of SBA services. Specifically, H.R. 7903 
defines the program with congressional intent. It outlines how 
Community Advantage lenders must operate within the program and details 
loan terms and other requirements.
  Mr. Speaker, I also thank the chairwoman and the ranking member for 
advancing this important legislation that will strengthen and improve 
the Community Advantage Loan Program.

  Mr. Speaker, I urge my colleagues to support the bill.
  Mr. CHABOT. Mr. Speaker, this is a good bill that deserves our 
support. The SBA's Community Advantage program provides both financial 
and technical assistance to our Nation's smallest firms. It is a great 
program that has proven results.
  Mr. Speaker, I urge my colleagues to support this bill, and I yield 
back the balance of my time.
  Ms. VELAZQUEZ. Mr. Speaker, in almost a decade, Community Advantage 
lenders have delivered over $770 million in affordable capital to 
underserved small businesses across America, assisting women- and 
minority-owned businesses that have historically struggled to secure 
affordable capital through traditional means, yet new lenders are 
hesitant to participate because of its pilot status and frequently 
changing rules.
  Today's bill will remedy these problems and ultimately grow the CA 
program to deliver more capital to entrepreneurs who need access to 
affordable capital the most, especially those severely impacted by the 
COVID-19 pandemic.
  Mr. Speaker, I applaud the work by the gentlewoman from California 
(Ms. Judy Chu) and the gentleman from Florida (Mr. Spano) for their 
efforts in crafting a bipartisan bill to codify the Community Advantage 
program.
  Mr. Speaker, I encourage all my colleagues to vote ``yes,'' and 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. 7903, 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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