[Congressional Record Volume 167, Number 64 (Wednesday, April 14, 2021)]
[House]
[Pages H1765-H1767]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]
MICROLOAN IMPROVEMENT ACT OF 2021
Ms. CRAIG. Madam Speaker, I move to suspend the rules and pass the
bill (H.R. 1502) to amend the Small Business Act to optimize the
operations of the microloan program, lower costs for small business
concerns and intermediary participants in the program, and for other
purposes.
The Clerk read the title of the bill.
The text of the bill is as follows:
H.R. 1502
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 ``Microloan Improvement Act of
2021''.
SEC. 2. INTEREST RATE FOR CERTAIN INTERMEDIARIES.
Section 7(m)(3)(F)(iii) of the Small Business Act (15
U.S.C. 636(m)(3)(F)(iii)) is amended by striking ``$7,500''
and inserting ``$10,000''.
SEC. 3. LINES OF CREDIT AUTHORIZED.
Section 7(m)(6)(A) of the Small Business Act (15 U.S.C.
636(m)(6)(A)) is amended by inserting ``(including lines of
credit)'' after ``fixed rate loans''.
SEC. 4. EXTENDED REPAYMENT TERMS.
(a) In General.--Section 7(m)(6) of the Small Business Act
(15 U.S.C. 636(m)(6)) is amended by adding at the end the
following:
``(F) Repayment terms.--
``(i) Limitation on repayments term.--The repayment term
for a loan made under this paragraph shall not be more than--
``(I) in the case of a loan made by an intermediary of
$10,000 or less, 7 years; and
``(II) in the case of a loan made by an intermediary of
greater than $10,000, 10 years.
``(ii) No additional limitations.--The Administrator may
not impose any additional limitation on the term for
repayment of a loan made by an intermediary under this
paragraph.''.
(b) Technical Amendment.--Section 329(c) of the Economic
Aid to Hard-Hit Small Businesses, Nonprofits, and Venues Act
(Public Law 116-260; 134 Stat. 2042 15 U.S.C. 636 note) is
repealed.
SEC. 5. PROGRAM FUNDING FOR MICROLOANS.
(a) In General.--Section 7(m) of the Small Business Act (15
U.S.C. 636(m)) is amended--
(1) in paragraph (7)(B)--
(A) by amending clause (i) to read as follows:
``(i) Allocation.--Subject to the availability of
appropriations and for the first 2 quarters of a fiscal year,
of the total amount of new loan funds made available for
award under this subsection in such fiscal year, the
Administrator shall--
``(I) reserve 15 percent of such funds for award to
designated underutilized States; and
``(II) make the remaining 85 percent of such funds
available for award in any State.''; and
(B) in clause (ii), by striking ``to carry out'' and all
that follows through the period at the end and inserting the
following: ``under clause (i)(I) remains unexpended, the
Administrator may make that portion available for award in
any State or designated underutilized State.''; and
(2) in paragraph (11)--
(A) in subparagraph (C)(ii), by striking ``and'' at the
end;
(B) in subparagraph (D), by striking the period at the end
and inserting ``; and''; and
(C) by adding at the end the following new subparagraph:
``(E) the term `State' means each of the several States,
the District of Columbia, the Commonwealth of Puerto Rico,
the United States Virgin Islands, Guam, the Northern Mariana
Islands, and American Samoa.''.
(b) Rulemaking.--Not later than 180 days after the date of
the enactment of this Act, the Administrator of the Small
Business Administration shall issue regulations to define the
term ``designated underutilized State'', as used in section
7(m)(7)(B) of the Small Business Act (15 U.S.C.
636(m)(7)(B)), as added by this section.
SEC. 6. CREDIT REPORTING INFORMATION.
The Administrator of the Small Business Administration
shall issue rules establishing a process under which an
intermediary that makes a loan to a borrower under section
7(m) of the Small Business Act (15 U.S.C. 636(m)) shall be
required to provide the major credit reporting agencies with
information about the borrower relevant to credit reporting,
such as the borrower's payment activity on the loan.
SEC. 7. REPORT REGARDING EQUITABLE DISTRIBUTION.
Section 7(m)(8) of the Small Business Act (15 U.S.C.
636(m)(8)) is amended--
(1) by striking ``In approving'' and inserting the
following:
``(A) In general.--In approving''; and
(2) by adding at the end the following:
``(B) Annual report.--The Administrator shall include in
the report submitted under paragraph (10), and make publicly
available on the website of the Administration, information
on how the Administration has met the requirements of
subparagraph (A).''.
The SPEAKER pro tempore. Pursuant to the rule, the gentlewoman from
[[Page H1766]]
Minnesota (Ms. Craig) and the gentleman from Missouri (Mr. Luetkemeyer)
each will control 20 minutes.
The Chair recognizes the gentlewoman from Minnesota.
General Leave
Ms. CRAIG. Madam 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 Minnesota?
There was no objection.
Ms. CRAIG. Madam Speaker, I yield myself such time as I may consume.
Madam Speaker, I rise in support of the bill before us today, H.R.
1502, the Microloan Improvement Act of 2021.
Today, we are considering four bipartisan bills that were approved by
the Small Business Committee and the full House of Representatives last
year. I am proud of the committee's work on behalf of small businesses
and pleased that we worked together to get things done. Our small
businesses deserve nothing less.
I would like to thank the chairwoman, Ms. Velazquez, for giving me
the opportunity to manage time today on these four important small
business bills.
I would also like to thank the ranking member, Mr. Luetkemeyer, who
will be handling the floor proceedings today with me.
Prior to the COVID-19 pandemic, the Subcommittee on Economic Growth,
Tax, and Capital Access, under the leadership of Mr. Kim, held a
hearing on the microloan program, where we heard from a panel of
intermediaries who reported that many of the program's rules, largely
unchanged since 1991, are outdated and restrict them from meeting
today's demand for start-up financing and providing more technical
assistance.
In response, Mr. Kim crafted the Microloan Improvement Act of 2020, a
series of proposals designed to update the program's rules and,
ultimately, help microloan intermediaries extend more affordable
capital to first-time entrepreneurs.
I was proud to support the Microloan Improvement Act last Congress
and was pleased to see some of its provisions become law as part of the
Economic Aid Act last December.
Today's bill, the Microloan Improvement Act of 2021, is virtually the
same as last Congress' version without the policies we have already
enacted into law.
Madam Speaker, we have heard time and again many entrepreneurs lack
the experience needed to demonstrate their creditworthiness to
conventional lenders. The COVID-19 pandemic has highlighted these gaps
in financing, showing the smallest of small businesses, especially
those owned by women and minorities, struggle the most to afford access
to capital.
The microloan program is uniquely suited to address this problem, and
today's bill strengthens the program and is long overdue.
I encourage my colleagues to support the bill.
Madam Speaker, I reserve the balance of my time.
Mr. LUETKEMEYER. Madam Speaker, I yield myself such time as I may
consume, and I rise in support of H.R. 1502, the Microloan Improvement
Act of 2021.
Before I begin, I would like to thank the chairwoman for working in a
bipartisan manner on behalf of our Nation's small businesses.
The bills before us today were developed in the 116th Congress and
have been updated and reintroduced in this Congress. They focus on the
Small Business Administration's existing government guaranteed loan
programs. These programs are important resources and tools for the
Nation's smallest businesses as they seek out financing.
Now, more than ever, these programs need to be ready for small
businesses as they begin and continue to recover from the COVID-19
pandemic. As ranking member of the Committee on Small Business, I want
to make sure we focus, or continue to focus on these programs that
assist the Nation's small businesses, entrepreneurs, and start-ups.
The first bill is the Microloan Improvement Act. This legislation
enhances and expands SBA's microloan program which provides loans of
$50,000 or less. This program, which is delivered to small businesses
through a partnership with microloan intermediaries, concentrates on
low-dollar loans and technical assistance.
When a small business is starting out, counseling and capital
assistance are true drivers of continued and prolonged success. H.R.
1502 further enhances the program for micro-borrowers by expanding the
repayment terms of the program and providing additional tools in their
toolbox.
Additionally, the bill removes the burdensome 1/55th rule that delays
dollars from flowing to microloan intermediaries within the first two
fiscal quarters of the year and replaces it with an allocation
mechanism that will provide more equitable access to all States across
the Nation.
I would like to thank Mr. Kim, Mr. Garbarino, Ms. Newman, and Mr.
Burchett for concentrating their efforts on this legislation.
Madam Speaker, I urge my colleagues to support H.R. 1502, and I
reserve the balance of my time.
Ms. CRAIG. Madam Speaker, I yield such time as she may consume to the
gentlewoman from Illinois (Ms. Newman).
Ms. NEWMAN. Madam Speaker, I rise today, excitedly, on behalf of the
millions of small businesses across our Nation that are truly suffering
from the pandemic and struggling to keep their doors open because
support is simply not reaching them.
As a former small business owner, I know firsthand how loans can make
an absolutely life-changing difference for an entrepreneur.
However, the reality is that too many small businesses, especially
those led by women, or minorities, or those in rural communities, don't
have access to the primary lending programs offered by the Small
Business Administration or private sector.
Microloans are designed to help start-ups and new small businesses
that don't have banking relationships with access to larger capital.
But for too many businesses, these microloans have been unreachable.
That is why I am proud to co-lead the Microloan Improvement Act to
ensure that, regardless of background or location, every business has
equitable access to capital.
With this legislation, we are expanding the number of community-based
lenders eligible for the lowest interest rates on loans. That means
these lenders can offer lines of credit to more small businesses.
Now more than ever, we have an obligation to remove barriers that
prevent small businesses from receiving microloans. With this
legislation, we are cutting bureaucratic red tape that has restricted
growth and job creation.
From mom-and-pop shops, to family-owned stores, to every small
business, they will all benefit. That is why this legislation is
supported by Democrats and Republicans, and I am so glad to partner
today with my Republican colleagues. I am happy to work in a bipartisan
fashion to help our intermediaries provide assistance to our local
entrepreneurs.
Let's pass this legislation so we can support the smallest of the
small businesses in all of our communities.
Mr. LUETKEMEYER. Madam Speaker, I yield such time as he may consume
to the gentleman from Tennessee (Mr. Burchett), who has been a leader
in small business issues.
Mr. BURCHETT. Madam Speaker, I thank the ranking member for yielding.
I rise in support of Representative Kim's Microloan Improvement Act.
I am proud to be an original cosponsor of this important legislation.
Access to financial capital is essential to the success of America's
small businesses and their entrepreneurs. This bipartisan bill is
straightforward and effective. It increases the number of nonprofit
community-based lenders that can offer loans through the SBA's
microloan program.
Representative Kim's bill works in tandem with the Microloan
Transparency and Accountability Act, my small business legislation that
we will debate shortly, to expand access to financial resources that
will help our aspiring small business owners and entrepreneurs chase
down the American Dream.
[[Page H1767]]
I encourage my colleagues to support this important bipartisan
legislation.
Ms. CRAIG. Madam Speaker, I have no further speakers and I am
prepared to close. I reserve the balance of my time.
Mr. LUETKEMEYER. Madam Speaker, I yield myself the balance of my
time.
Madam Speaker, 2020 was a difficult year for small businesses. The
COVID-19 pandemic hit small businesses hard. This is especially true
for small businesses that were just starting out.
As our country continues to recover, the SBA's programs and resources
must be ready to assist the Nation's job creators along the way.
The microloan program is a key tool for many small business owners.
The reforms in H.R. 1502 are commonsense improvements that will
continue to provide assistance and resources to America's Main Street
businesses.
Madam Speaker, I urge and recommend my colleagues to support H.R.
1502, and I yield back the balance of my time.
{time} 1430
Ms. CRAIG. Madam Speaker, I yield myself the balance of my time.
As the small business economy starts to recover from the COVID-19
pandemic, entrepreneurs will need as many affordable capital options as
possible. That is why the Economic Aid Act included PPP updates, grants
for hard-hit venues, and other enhancements to SBA's business loan
programs, including the microloan program.
Today's bill takes the next step after that relief effort toward
fully modernizing and optimizing SBA's microloan program. For nearly 30
years, this program has had a strong track record of success and has
helped to launch many successful small businesses, especially those
owned by women and minority entrepreneurs. The record is full of
success stories as the program has grown from a simple pilot program to
a vital lending tool with strong stakeholder and congressional support.
The legislation before us today renews our commitment to startups by
easing access to the program for even more aspiring entrepreneurs and
making the program nimbler for intermediaries and borrowers alike.
Passing this bill will be another step to help lead our Nation out of
this pandemic and build back the economy by embracing America's
entrepreneurial spirit.
I applaud the work by Mr. Kim and Mr. Garbarino for their bipartisan
work on the microloan program. I encourage all of 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 Minnesota (Ms. Craig) that the House suspend the rules
and pass the bill, H.R. 1502.
The question was taken.
The SPEAKER pro tempore. In the opinion of the Chair, two-thirds
being in the affirmative, the ayes have it.
Mr. WEBER of Texas. Madam Speaker, on that I demand the yeas and
nays.
The SPEAKER pro tempore. Pursuant to section 3(s) of House Resolution
8, the yeas and nays are ordered.
Pursuant to clause 8 of rule XX, further proceedings on this motion
are postponed.
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