[Congressional Record Volume 172, Number 105 (Tuesday, June 23, 2026)]
[House]
[Pages H4143-H4145]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]
DISASTER LOAN ACCOUNTABILITY AND REFORM ACT
Mr. WILLIAMS of Texas. Mr. Speaker, I move to suspend the rules and
pass the bill (H.R. 4238) to improve accountability in the disaster
loan program 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. 4238
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 ``Disaster Loan Accountability
and Reform Act'' or the ``DLARA''.
SEC. 2. TABLE OF CONTENTS.
The table of contents for this Act is as follows:
Sec. 1. Short title.
Sec. 2. Table of contents.
Sec. 3. Definitions.
Sec. 4. Monthly disaster loan reports.
Sec. 5. Budget request relating to disaster loans.
Sec. 6. Limitations on disaster loans.
Sec. 7. GAO report on SBA disaster loan account.
Sec. 8. GAO report on disaster loan changes.
Sec. 9. Budget and forecasting report regarding the cost of direct
disaster loans.
SEC. 3. DEFINITIONS.
In this Act--
(1) the terms ``Administration'' and ``Administrator'' mean
the Small Business Administration and the Administrator
thereof, respectively;
(2) the term ``appropriate committees of Congress'' means
the Committee on Small Business and Entrepreneurship and the
Committee on Appropriations of the Senate and the Committee
on Small Business and the Committee on Appropriations of the
House of Representatives; and
(3) the term ``SBA disaster loan'' means a direct loan
authorized by section 7(b) of the Small Business Act (15
U.S.C. 636(b)), other than a loan that was authorized under
section 1110 of the CARES Act (15 U.S.C. 9009).
SEC. 4. MONTHLY DISASTER LOAN REPORTS.
Section 12091(a) of the Small Business Disaster Response
and Loan Improvements Act of 2008 (15 U.S.C. 636k(a)) is
amended--
(1) in paragraph (1)--
(A) by striking ``during the applicable period for a major
disaster''; and
(B) by striking ``for that major disaster'';
(2) in paragraph (2)--
(A) in subparagraph (E), by striking ``how long the
available funding for such loans will last'' and inserting
``the date at which available funding for such loans will
reach 10 percent of the most recent appropriation and the
date at which the funds will be depleted'';
(B) in subparagraph (H), by striking ``and'' at the end;
(C) in subparagraph (I), by striking the period at the end
and inserting ``; and''; and
(D) by adding at the end the following:
``(J) a summary detailing any changes to estimates or
assumptions on obligations and expenditures, including data
supporting these changes.''; and
(3) by adding at the end the following:
``(3) Prohibition on official travel.--If the Administrator
does not submit a report required to be submitted under
paragraph (1) by the required date, no funds are authorized
to be appropriated for official travel by the Administrator
until the Administrator submits the report.''.
SEC. 5. BUDGET REQUEST RELATING TO DISASTER LOANS.
Section 1105 of title 31, United States Code, is amended--
(1) in subsection (a), by adding at the end the following:
``(39) separate statements of--
``(A) the amount of appropriations requested for the fiscal
year for which the budget is submitted for the cost of SBA
disaster loans, the 10-year average of the cost of SBA
disaster loans, and an explanation for any difference between
the amount requested and the 10-year average cost; and
``(B) the amount of appropriations requested for the fiscal
year for which the budget is submitted for the cost of COVID-
EIDL loans, the 10-year average of the cost of COVID-EIDL
loans, and an explanation for any difference between the
amount requested and the 10-year average cost.
``(40) separate statements of--
``(A) the amount of appropriations requested for the fiscal
year for which the budget is submitted for administrative
costs relating to SBA disaster loans, the 10-year average of
such administrative costs, and an explanation for any
difference between the amount requested and the 10-year
average costs; and
``(B) the amount of appropriations requested for the fiscal
year for which the budget is submitted for administrative
costs relating to COVID-EIDL loans, the 10-year average of
such administrative costs, and an explanation for any
difference between the amount requested and the 10-year
average costs.''; and
(2) by adding at the end the following:
``(j) In paragraphs (39) and (40) of subsection (a)--
[[Page H4144]]
``(1) the term `COVID-EIDL loan' means a direct loan under
section 7(b) of the Small Business Act (15 U.S.C. 636(b))
that was authorized under section 1110 of the CARES Act (15
U.S.C. 9009); and
``(2) the term `SBA disaster loan' means a direct loan
authorized by section 7(b) of the Small Business Act (15
U.S.C. 636(b)), other than a loan that was authorized under
section 1110 of the CARES Act (15 U.S.C. 9009).''.
SEC. 6. LIMITATIONS ON DISASTER LOANS.
Section 7(b) of the Small Business Act (15 U.S.C. 636(b))
is amended--
(1) by redesignating the second paragraph designated as
paragraph (16), relating to statute of limitations, as added
by the COVID-19 EIDL Fraud Statute of Limitations Act of 2022
(Public Law 117-165; 136 Stat. 1363), as paragraph (18); and
(2) by inserting after paragraph (16), relating to disaster
declarations in rural areas, as added by the Disaster
Assistance for Rural Communities Act (Public Law 117-249; 136
Stat. 2350), the following:
``(17) Requirements when funding is low.--Not later than 24
hours after the balance of funds authorized to be
appropriated for the cost of direct loans authorized by this
subsection is less than 10 percent of the 10-year average
annual cost provided in the most recent Presidential budget
request required under section 1105(a)(39)(A) of title 31,
United States Code, or, if unavailable, the 10-year average
annual cost for the immediately preceding 10-year period of
SBA disaster loans (as defined in section 1105(j) of such
title), the Administrator shall notify the Committee on
Appropriations and the Committee on Small Business and
Entrepreneurship of the Senate and the Committee on
Appropriations and the Committee on Small Business of the
House of Representatives.''.
SEC. 7. GAO REPORT ON SBA DISASTER LOAN ACCOUNT.
(a) Report.--Not later than 180 days after the date of
enactment of this Act, the Comptroller General of the United
States shall submit to the Administrator and the appropriate
committees of Congress a report on--
(1) the average weekly rate at which the Administration
obligates the unobligated balance of amounts available for
the cost of SBA disaster loans;
(2) the average amount, during the periods beginning on
October 1, 2015, and ending on July 31, 2023, and beginning
on July 31, 2023, and ending on the date of enactment of this
Act, respectively, disbursed to a borrower each week, during
the initial 12-week period in which a borrower receives
amounts from an SBA disaster loan, beginning the day after
the borrower accepts their loan, separated by home SBA
disaster loan borrowers, business SBA disaster loan
borrowers, and economic injury disaster loan borrowers; and
(3) the average amount of fully disbursed SBA disaster
loans, originated during the period beginning on July 31,
2023, and ending on the date of enactment of this Act, with
separate averages for SBA disaster loans delineated by home,
business, and economic injury disaster loans.
(b) Response.--Not later than 90 days after the date on
which the Comptroller General of the United States submits
the report under subsection (a), the Administrator shall
submit to the appropriate committees of Congress a response
to the report, including an implementation plan for any
recommendations in the report.
SEC. 8. GAO REPORT ON DISASTER LOAN CHANGES.
(a) Definition.--In this section, the term ``covered final
rule'' means--
(1) the final rule entitled ``Disaster Assistance Loan
Program Changes to Maximum Loan Amounts and Miscellaneous
Updates'' (88 Fed. Reg. 39335 (June 16, 2023); RIN 3245-
AH91); or
(2) the final rule entitled ``Disaster Assistance Loan
Program Changes to Unsecured Loan Amounts and Credit
Elsewhere Criteria'' (89 Fed. Reg. 59826 (July 24, 2024); RIN
3245-AI08).
(b) Report.--Not later than 1 year after the date of
enactment of this Act, the Comptroller General of the United
States shall submit to the appropriate committees of Congress
a report on--
(1) the cost (as defined in section 502 of the Federal
Credit Reform Act of 1990 (2 U.S.C. 661a)) of the increase in
the home loan lending limits for, the extension of the
deferment period for, the expansion of mitigation options
for, the modifications to the criteria for determining
whether applicants can obtain credit elsewhere with respect
to, the changes to collateral requirements for, and other
changes to the terms and conditions of loans under section
7(b)(1) of the Small Business Act (15 U.S.C. 636(b)(1)) made
by the covered final rules; and
(2) the effect on the subsidy for such loans of the changes
contained in the covered final rules.
SEC. 9. BUDGET AND FORECASTING REPORT REGARDING THE COST OF
DIRECT DISASTER LOANS.
(a) Budget Formulation and Forecasting.--Not later than 30
days after the date of enactment of this Act, the
Administrator shall submit to the appropriate committees of
Congress a report detailing corrections the Administration
will make to improve forecasting, data quality, and budget
assumptions relating to budget submissions relating to
amounts made available for the cost of SBA disaster loans.
(b) Updates.--Not later than 90 days after the date of
enactment of this Act, and every 90 days thereafter until the
date that is 90 days after the date on which all the
corrections described in subsection (a) have been
implemented, the Administrator shall submit to the
appropriate committees of Congress a report--
(1) detailing the actions the Administration has taken to
implement the corrections described in subsection (a); and
(2) explaining how each action detailed under paragraph (1)
is directly related to implementing 1 or more corrections
described in subsection (a).
The SPEAKER pro tempore. Pursuant to the rule, the gentleman from
Texas (Mr. Williams) and the gentleman from Maryland (Mr. Olszewski)
each will control 20 minutes.
The Chair recognizes the gentleman from Texas.
General Leave
Mr. WILLIAMS of Texas. Mr. Speaker, I ask unanimous consent that all
Members have 5 legislative days in which to revise and extend their
remarks and include extraneous material on the bill.
The SPEAKER pro tempore. Is there objection to the request of the
gentleman from Texas?
There was no objection.
Mr. WILLIAMS of Texas. Mr. Speaker, I yield myself such time as I may
consume.
Mr. Speaker, I rise today in strong support of H.R. 4238, the
Disaster Loan Accountability and Reform Act introduced by
Representative Moore from the great State of North Carolina.
Disaster survivors should not have to wonder whether relief will
arrive in time. Instead, they should be able to trust that the programs
designed to help them recover are prepared to meet the moment.
The SBA's disaster loan program serves as a critical lifeline for
families, homeowners, and small businesses recovering from natural
disasters. Communities hit by hurricanes, floods, wildfires, and other
emergencies use these loans to rebuild their homes, restore their
livelihoods, and get themselves back on their feet.
That is why it was so concerning that during the 2024 hurricane
season, the SBA disaster loan program exhausted its funding and was
forced to pause new loan disbursements while communities were actively
recovering from Hurricanes Helene and Milton.
The disruption highlighted serious concerns about the program's
budgeting, oversight, and communication processes.
It is a sobering thought to know that at a time when thousands of
vulnerable Americans were seeking assistance, the program was unable to
provide the support they needed. Americans who have already survived a
disaster should not face additional uncertainty because of preventable
administrative failures.
This legislation will ensure that the SBA disaster relief programs
will be backed by strong oversight, transparent budgeting, and timely
communication with Congress.
I urge all of my colleagues to support H.R. 4238. Mr. Speaker, I
reserve the balance of my time.
Mr. OLSZEWSKI. Mr. Speaker, I yield myself such time as I may
consume.
Mr. Speaker, SBA loans provide long-term, low-interest capital to
homeowners, renters, entrepreneurs, and nonprofits after declared
disasters, playing a critical role in Federal disaster response and
recovery.
In 2024, several major hurricanes made landfall in the U.S.,
crippling not only our communities but SBA's disaster loan fund, as
well.
On October 15, 2024, the agency announced its disaster loan funds had
been exhausted, and it couldn't approve or disburse new loans until
Congress appropriated extra money delaying much-needed relief to the
affected areas.
Ultimately, this failure was caused by a lack of communication from
the SBA to Congress. They failed to submit required reports on the
disaster program, and they didn't give Congress enough notice to
replenish the funds. That is why the Disaster Loan Accountability
Reform Act, or DLARA, is necessary.
This bill would expand SBA disaster loan notice and reporting
requirements, create specific budget line items for disaster loans, and
direct the U.S. Government Accountability Office to study how previous
rulemaking has impacted the speed of disaster loan disbursement.
I commend Representatives Davis and Moore of North Carolina, as well
[[Page H4145]]
as Ms. Goodlander, Ms. King-Hinds, and Mr. Meuser for working together
on this critical issues.
Mr. Speaker, I urge members to support this bill, as amended, and I
reserve the balance of my time.
Mr. WILLIAMS OF Texas. Mr. Speaker, I yield such time as he may
consume to the gentleman from North Carolina (Mr. Moore).
Mr. MOORE of North Carolina. Mr. Speaker, I will first start off with
thanking my colleague on the other side of the aisle for his support on
this. It is great when we can do bipartisan things, particularly on
such subject matter.
I rise today in support of my bill, the Disaster Loan Accountability
and Reform Act. When Hurricane Helene struck western North Carolina and
so many other States, small businesses were on the front lines of
recovery.
They stepped up to serve their communities and support their
neighbors. They led, in a lot of ways, the response when it was needed
most.
When disaster hits, speed matters.
Delays can determine whether businesses reopen or whether homes are
repaired. The longer it takes for a community to rebuild, the greater
the strain on the local economy.
That is why the Small Business Administration's Disaster Loan Program
is so important.
It provides low-interest, long-term loans that help homeowners and
businesses recover, rebuild, and get back on their feet.
Unfortunately, a few years ago, the SBA failed to notify Congress
that the disaster loan account was running dangerously low on funds.
So what happened?
{time} 1520
As a result, the program experienced a 66-day funding shortfall. What
that did, Mr. Speaker, was leave homeowners and small businesses unable
to access critical disaster assistance when they needed it most.
Hurricane Helene exposed serious weaknesses in the oversight and
management of this account. We should learn from these failures rather
than allowing them to be repeated.
That is why I introduced this bill. It strengthens oversight,
increases transparency, and also puts in place even better financial
safeguards within the Small Business Administration's disaster loan
program.
These reforms are going to help ensure that Congress receives timely
information, that resources are managed responsibly, and that disaster
assistance remains available when Americans need it, not after it is
too late.
Homeowners and small businesses cannot afford delays after a
disaster. This ensures that the Federal Government is better prepared
to respond quickly, effectively, and responsibly when disaster strikes.
Mr. Speaker, I urge my colleagues to support this bill.
Mr. OLSZEWSKI. Mr. Speaker, I yield myself the balance of my time to
close.
Mr. Speaker, DLARA would make numerous bipartisan reforms to the SBA
disaster loan program, like expanded notice and reporting requirements,
separate budget line items, and professional evaluations of the
program's administration in light of recent rule changes.
This bill will go a long way to ensure that the disaster loan account
does not run out of funds again and that disaster victims receive
assistance in a timely manner.
Mr. Speaker, I urge all Members to support the bill, and I yield back
the balance of my time.
Mr. WILLIAMS of Texas. Mr. Speaker, I yield myself the balance of my
time to close.
Mr. Speaker, we must pass H.R. 4238 to strengthen oversight of the
SBA disaster loan program. I yield back the balance of my time.
The SPEAKER pro tempore. The question is on the motion offered by the
gentleman from Texas (Mr. Williams) that the House suspend the rules
and pass the bill, H.R. 4238, 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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