[Congressional Record (Bound Edition), Volume 149 (2003), Part 12]
[House]
[Pages 15797-15800]
[From the U.S. Government Publishing Office, www.gpo.gov]




       PREMIER CERTIFIED LENDERS PROGRAM IMPROVEMENT ACT OF 2003

  Mr. MANZULLO. Mr. Speaker, I move to suspend the rules and pass the 
bill (H.R. 923) to amend the Small Business Investment Act of 1958 to 
allow certain premier certified lenders to elect to maintain an 
alternative loss reserve, as amended.
  The Clerk read as follows:

                                H.R. 923

       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 ``Premier Certified Lenders 
     Program Improvement Act of 2003''.

     SEC. 2. LOSS RESERVES OF PREMIER CERTIFIED LENDERS 
                   TEMPORARILY DETERMINED ON THE BASIS OF 
                   OUTSTANDING BALANCE OF DEBENTURES.

       Paragraph (6) of section 508(c) of the Small Business 
     Investment Act of 1958 (15 U.S.C. 697e(c)) is amended--
       (1) by striking ``The Administration'' and inserting the 
     following:
       ``(A) In general.--The Administration''; and
       (2) by adding at the end the following new subparagraph:
       ``(B) Temporary reduction based on outstanding balance.--
     Notwithstanding subparagraph (A), during the 2-year period 
     beginning on the date that is 90 days after the date of the 
     enactment of this subparagraph, the Administration shall 
     allow the certified development company to withdraw from the 
     loss reserve such amounts as are in excess of 1 percent of 
     the aggregate outstanding balances of debentures to which 
     such loss reserve relates. The preceding sentence shall not 
     apply with respect to any debenture before 100 percent of the 
     contribution described in paragraph (4) with respect to such 
     debenture has been made.''.

     SEC. 3. ALTERNATIVE LOSS RESERVE PILOT PROGRAM FOR CERTAIN 
                   PREMIER CERTIFIED LENDERS.

       (a) In General.--Subsection (c) of section 508 of the Small 
     Business Investment Act of 1958 (15 U.S.C. 697e) is amended 
     by adding at the end the following new paragraphs:
       ``(7) Alternative loss reserve.--
       ``(A) Election.--With respect to any eligible calendar 
     quarter, any qualified high loss reserve PCL may elect to 
     have the requirements of this paragraph apply in lieu of the 
     requirements of paragraphs (2) and (4) for such quarter.
       ``(B) Contributions.--
       ``(i) Ordinary rules inapplicable.--Except as provided 
     under clause (ii) and paragraph (5), a qualified high loss 
     reserve PCL that makes the election described in subparagraph 
     (A) with respect to a calendar quarter shall not be required 
     to make contributions to its loss reserve during such 
     quarter.
       ``(ii) Based on loss.--A qualified high loss reserve PCL 
     that makes the election described in subparagraph (A) with 
     respect to any calendar quarter shall, before the last day of 
     such quarter, make such contributions to its loss reserve as 
     are necessary to ensure that the amount of the loss reserve 
     of the PCL is--

       ``(I) not less than $100,000; and
       ``(II) sufficient, as determined by a qualified independent 
     auditor, for the PCL to meet its obligations to protect the 
     Federal Government from risk of loss.

       ``(iii) Certification.--Before the end of any calendar 
     quarter for which an election is in effect under subparagraph 
     (A), the head of the PCL shall submit to the Administrator a 
     certification that the loss reserve of the PCL is sufficient 
     to meet such PCL's obligation to protect the Federal 
     Government from risk of loss. Such certification shall be in 
     such form and submitted in such manner as the Administrator 
     may require and shall be signed by the head of such PCL and 
     the auditor making the determination under clause (ii)(II).
       ``(C) Disbursements.--
       ``(i) Ordinary rule inapplicable.--Paragraph (6) shall not 
     apply with respect to any qualified high loss reserve PCL for 
     any calendar quarter for which an election is in effect under 
     subparagraph (A).
       ``(ii) Excess funds.--At the end of each calendar quarter 
     for which an election is in effect under subparagraph (A), 
     the Administration shall allow the qualified high loss 
     reserve PCL to withdraw from its loss reserve the excess of--

       ``(I) the amount of the loss reserve, over
       ``(II) the greater of $100,000 or the amount which is 
     determined under subparagraph (B)(ii) to be sufficient to 
     meet the PCL's obligation to protect the Federal Government 
     from risk of loss.

       ``(D) Recontribution.--If the requirements of this 
     paragraph apply to a qualified high loss reserve PCL for any 
     calendar quarter and cease to apply to such PCL for any 
     subsequent calendar quarter, such PCL shall make a 
     contribution to its loss reserve in such amount as the 
     Administrator may determine provided that such amount does 
     not exceed the amount which would result in the total amount 
     in the loss reserve being equal to the amount which would 
     have been in such loss reserve had this paragraph never 
     applied to such PCL. The Administrator may require that such 
     payment be made as a single payment or as a series of 
     payments.
       ``(E) Risk management.--If a qualified high loss reserve 
     PCL fails to meet the requirement of subparagraph (F)(iii) 
     during any period for which an election is in effect under 
     subparagraph (A) and such failure continues for 180 days, the 
     requirements of paragraphs (2), (4), and (6) shall apply to 
     such PCL as of the end of such 180-day period and such PCL 
     shall make the contribution to its loss reserve described in 
     subparagraph (D). The Administrator may waive the 
     requirements of this subparagraph.
       ``(F) Qualified high loss reserve pcl.--The term `qualified 
     high loss reserve PCL' means, with respect to any calendar 
     year, any premier certified lender designated by the 
     Administrator as a qualified high loss reserve PCL for such 
     year. The Administrator shall not designate a company under 
     the preceding sentence unless the Administrator determines 
     that--
       ``(i) the amount of the loss reserve of the company is not 
     less than $100,000;
       ``(ii) the company has established and is utilizing an 
     appropriate and effective process for analyzing the risk of 
     loss associated with its portfolio of PCLP loans and for 
     grading each PCLP loan made by the company on the basis of 
     the risk of loss associated with such loan; and
       ``(iii) the company meets or exceeds 4 or more of the 
     specified risk management benchmarks as of the most recent 
     assessment by the Administration or the Administration has 
     issued a waiver with respect to the requirement of this 
     clause.
       ``(G) Specified risk management benchmarks.--For purposes 
     of this paragraph, the term `specified risk management 
     benchmarks' means the following rates, as determined by the 
     Administrator:
       ``(i) Currency rate.
       ``(ii) Delinquency rate.
       ``(iii) Default rate.
       ``(iv) Liquidation rate.
       ``(v) Loss rate.
       ``(H) Qualified independent auditor.--For purpose of this 
     paragraph, the term `qualified independent auditor' means any 
     auditor who--
       ``(i) is compensated by the qualified high loss reserve 
     PCL;
       ``(ii) is independent of such PCL; and
       ``(iii) has been approved by the Administrator during the 
     preceding year.
       ``(I) PCLP loan.--For purposes of this paragraph, the term 
     `PCLP loan' means any loan guaranteed under this section.
       ``(J) Eligible calendar quarter.--For purposes of this 
     paragraph, the term `eligible calendar quarter' means--
       ``(i) the first calendar quarter that begins after the end 
     of the 90-day period beginning with the date of the enactment 
     of this paragraph; and
       ``(ii) the 7 succeeding calendar quarters.
       ``(K) Calendar quarter.--For purposes of this paragraph, 
     the term `calendar quarter' means--
       ``(i) the period which begins on January 1 and ends on 
     March 31 of each year;
       ``(ii) the period which begins on April 1 and ends on June 
     30 of each year;
       ``(iii) the period which begins on July 1 and ends on 
     September 30 of each year; and
       ``(iv) the period which begins on October 1 and ends on 
     December 31 of each year.
       ``(L) Regulations.--Not later than 45 days after the date 
     of the enactment of this paragraph, the Administrator shall 
     publish in the Federal Register and transmit to the Congress 
     regulations to carry out this paragraph. Such regulations 
     shall include provisions relating to--
       ``(i) the approval of auditors under subparagraph (H); and
       ``(ii) the designation of qualified high loss reserve PCLs 
     under subparagraph (F), including the determination of 
     whether a process for analyzing risk of loss is appropriate 
     and effective for purposes of subparagraph (F)(ii).
       ``(8) Bureau of pclp oversight.--
       ``(A) Establishment.--There is hereby established in the 
     Small Business Administration a bureau to be known as the 
     Bureau of PCLP Oversight.
       ``(B) Purpose.--The Bureau of PCLP Oversight shall carry 
     out such functions of the Administration under this 
     subsection as the Administrator may designate.
       ``(C) Deadline.--Not later than 90 days after the date of 
     the enactment of this Act--
       ``(i) the Administrator shall ensure that the Bureau of 
     PCLP Oversight is prepared to carry out any functions 
     designated under subparagraph (B), and
       ``(ii) the Office of the Inspector General of the 
     Administration shall report to the Congress on the 
     preparedness of the Bureau of PCLP Oversight to carry out 
     such functions.''.
       (b) Increased Reimbursement for Losses Related to 
     Debentures Issued During Election Period.--Subparagraph (C) 
     of section 508(b)(2) of the Small Business Investment Act of 
     1958 (15 U.S.C. 697e(b)(2)) is amended by inserting ``(15 
     percent in the case of any such loss attributable to a 
     debenture issued by the company during any period for which 
     an election is

[[Page 15798]]

     in effect under subsection (c)(7) for such company)'' before 
     ``; and''.
       (c) Conforming Amendments.--
       (1) Subparagraph (D) of section 508(b)(2) of the Small 
     Business Investment Act of 1958 (15 U.S.C. 697e(b)(2)) is 
     amended by striking ``subsection (c)(2)'' and inserting 
     ``subsection (c)''.
       (2) Paragraph (5) of section 508(c) of the Small Business 
     Investment Act of 1958 (15 U.S.C. 697e(c)) is amended by 
     striking ``10 percent''.
       (d) Study and Report.--
       (1) In general.--The Administrator shall enter into a 
     contract with a Federal agency experienced in community 
     development lending and financial regulation or with a member 
     of the Federal Financial Institutions Examinations Council to 
     study and prepare a report regarding--
       (A) the extent to which statutory requirements have caused 
     overcapitalization in the loss reserves maintained by 
     certified development companies participating in the Premier 
     Certified Lenders Program established under section 508 of 
     the Small Business Investment Act of 1958 (15 U.S.C. 697e); 
     and
       (B) alternatives for establishing and maintaining loss 
     reserves that are sufficient to protect the Federal 
     Government from the risk of loss associated with loans 
     guaranteed under such Program.
       (2) Transmission of report.--The report described in 
     paragraph (1) shall be transmitted to the Committee on Small 
     Business of the House of Representatives and the Committee on 
     Small Business and Entrepreneurship of the Senate not later 
     than 90 days after the date of the enactment of this Act.
       (3) Limitation.--The amount of the contract described in 
     paragraph (1) shall not exceed $75,000.

  The SPEAKER pro tempore. Pursuant to the rule, the gentleman from 
Illinois (Mr. Manzullo) and the gentlewoman from the Virgin Islands 
(Mrs. Christensen) each will control 20 minutes.
  The Chair recognizes the gentleman from Illinois (Mr. Manzullo).


                             General Leave

  Mr. MANZULLO. Mr. Speaker, I ask unanimous consent that all Members 
may have 5 legislative days within which to revise and extend their 
remarks and include extraneous material on this legislation.
  The SPEAKER pro tempore. Is there objection to the request of the 
gentleman from Illinois?
  There was no objection.
  Mr. MANZULLO. Mr. Speaker, I yield myself such time as I may consume.
  The SBA's 504 Certified Development Company program provides small 
businesses with long-term, fixed-rate financing for the purchase of 
fixed assets such as land, buildings and equipment for business 
expansion purposes. The loans are made by CDCs, usually nonprofit 
corporations organized to contribute to the economic development of a 
particular community or region. The entire 504 program runs totally on 
user fees charged to small business borrowers. It does not receive an 
annual appropriation.
  SBA has a Premier Certified Lender program that gives discretion to 
certain qualified CDCs to approve 504 loans subject to the borrower 
being eligible and the available loan authority. In return for this 
lower regulatory oversight, these premier CDCs must set aside more 
money in order to cover potentially bad loans than regular CDCs. Some 
premier CDCs believe that this amount of reserve is well beyond what is 
prudently required.
  My good friend and colleague, the gentleman from California (Mr. 
Doolittle), introduced H.R. 923 for the purpose of allowing premier 
CDCs to take a cue from the private sector by using a risk-based 
management approach to calculate the loan loss reserve requirements. I 
agree with this approach subject to certain conditions to protect the 
taxpayer and to ensure that no unintended consequences result from this 
change in policy such as higher loan fees. Our staffs have met to 
develop an acceptable compromise which unanimously passed the committee 
last month. I am pleased to present it to my colleagues before the full 
House today.
  This bipartisan compromise creates a 2-year pilot program that 
permits qualified premier CDCs to use a risk-based approach to 
calculate their loan loss reserve requirements. In order to ensure that 
premier CDCs' loan loss reserves are sufficient to protect the 
taxpayer, the compromise establishes a Bureau of PCLP oversight within 
the Office of Lender Oversight at SBA. For those premier CDCs not in 
the new pilot program, they can withdraw from their loss such amounts 
that are in excess of 1 percent of their total outstanding loan 
balances. Finally, this compromise provides for a study to evaluate 
alternative loan loss reserve approaches.
  H.R. 923 is about providing more liquidity and capital into the hands 
of small businesses without any additional cost to the taxpayer. I urge 
my colleagues to support H.R. 923.
  Mr. Speaker, I reserve the balance of my time.
  Mrs. CHRISTENSEN. Mr. Speaker, I yield myself such time as I might 
consume.
  Mr. Speaker, today I rise in strong support of H.R. 923. This 
legislation is among the first steps that Congress will take this year 
to ensure that the Small Business Administration continues to serve the 
needs of our country's small businesses. I would like to thank the 
gentleman from California (Mr. Doolittle) for bringing this important 
bill to the Committee on Small Business's attention.
  This legislation will allow certified development companies to make 
more loans to small businesses while safeguarding the interests of our 
taxpayers. This is good for the government and good for small business, 
the driver of this Nation's economy.
  Even though access to capital is access to opportunity for small 
businesses, many find it difficult to get funding, especially given the 
current lending environment. The SBA's lending program addresses this 
by providing a vital stream of funding to small businesses. Last year, 
these programs supplied $21 billion in capital, accounting for 40 
percent of all long-term small business lending to this country's 
entrepreneurs.
  Among SBA's loan programs, the 504 program provides the best value to 
taxpayers because it is completely self-funded. While the 504 program 
requires no funding, it contributes substantially to the economic 
growth of our communities. Given the weak state of our economy, the 504 
program is especially important now because it promotes investment 
where we need it most, in the small business sector.
  Yet capital remained elusive to many small businesses because the 
SBA, in many cases, took too long to make these loans and the process 
was too complicated. Since the SBA processing time for 504 applications 
can frequently approach 30 days, borrowers and lenders were deterred 
from participating.
  In response to this, Congress created the Premier Certified Lender 
program. Through this public-private partnership, certified development 
companies are permitted to process their 504 loans without SBA 
approval. In exchange for this autonomy, SBA requires the certified 
development companies to assume responsibility for some of the losses 
associated with the loans they make.
  While the Premier Certified Lender program addresses one problem, it 
created another by requiring the certified development companies to 
hold loan loss reserves in excess of amounts necessary to protect the 
government. These excess funds could serve a much better purpose, like 
being used to make loans for small business, the number one job creator 
in the United States, instead of sitting in a ledger helping no one at 
all.
  To address these issues, today we are creating a pilot program that 
will permit the certified development companies to maintain loan loss 
reserves sufficient to protect the government and to draw out those 
amounts that are held in excess of such purposes. In order to oversee 
this new program, we are creating a new bureau within SBA.
  By creating a system that frees up these funds, certified development 
companies will then be able to make more loans to small businesses, 
which is exactly what this Nation needs in a time of such economic 
uncertainty. Economic recovery is only within reach if small businesses 
are able to start up and grow, and this is impossible without capital.
  H.R. 923 takes the important first steps to modernize the 504 program 
and, in doing so, increases small businesses' ability to secure much-
needed capital.

[[Page 15799]]

  Mr. Speaker, I urge the adoption of this legislation.
  Mr. Speaker, I reserve the balance of my time.
  Mr. MANZULLO. Mr. Speaker, I yield 5 minutes to the gentleman from 
California (Mr. Doolittle), my good friend and colleague, the author of 
the bill.
  Mr. DOOLITTLE. Mr. Speaker, I thank the gentleman from Illinois (Mr. 
Manzullo) and the gentlewoman from the Virgin Islands (Mrs. 
Christensen) for their remarks. I very much appreciate the support that 
they have given me on this bill and the cooperation that we have had 
from their staffs. I would like to acknowledge the gentlewoman from New 
York (Ms. Velazquez), the ranking member, as well.
  Indeed, the explanation for what this bill does has been clearly 
articulated by both our previous speakers and so I will choose not to 
repeat that, Mr. Speaker; but I have a statement which I will submit 
for the Record.

                              {time}  1045

  I feel that this bill, as was explained by our previous speakers, 
will actually do something to help stimulate the economy. The Premier 
Certified Lenders Program is an excellent program. It has been 
unnecessarily tied down by the problem with the requirements about the 
loan loss reserves. This bill, as was explained, creates a risk-based 
approach to loan loss reserves with sufficient safeguards and 
monitoring to make sure that everything is going along as we would wish 
it to.
  In the process, however, a tremendous amount of funds will be freed 
up that will be used to make loans to small businesses, and as we know, 
as this process unfolds, that will result in the employment of more 
people and the generation of more capital and will trigger, indeed, the 
very process that we need to have happen in order to make this a more 
vibrant and stronger economy.
  Mr. Speaker, I rise today in support of H.R. 923, the Premier 
Certified Lenders Program Improvement Act, legislation I introduced in 
February.
  Over the past few years, I have had an opportunity to learn of the 
outstanding work that certified development companies are doing across 
the county and in my district, in particular. CDCs participating in the 
Premier Certified Lenders Program are providing thousands of loans to 
small businesses and helping these businesses to create jobs and 
wealth.
  As my colleagues know, small businesses are the economic backbone of 
our Nation. Nearly one in four American households are either starting 
a business, presently owning a a business, or investing in someone 
else's business. Our economy depends on entrepreneurs whose spirit 
result in the creation of both new businesses and new jobs.
  I think the best policy our government can pursue to help small 
businesses in this country is to get out of their way. Unshackle the 
American spirit from high taxes and burdensome regulations, Mr. 
Speaker, and we shall witness tremendous job creation and economic 
growth. If the government seeks to help small businesses, it should 
remove regulatory hurdles and provide incentives for entrepreneurs.
  One successful example of government encouragement of small business 
expansion is the Premier Certified Lenders Program PCLP. This program 
was established in 1997 and allows a participating Certified 
Development Company, CDC, the expanded authority to review and approve 
SBA 504 Loan requests and to foreclose, litigate, and liquidate SBA 504 
Loans made under the Program. By taking on this authority, the private 
sector is able to stretch limited Federal resources in order to help 
more small businesses.
  Unfortunately, current law requires premier certified lenders to 
deposit and maintain 1 percent of each debenture issued in a loan loss 
reserve fund, from which they are to reimburse the Small Business 
Administration, SBA, for 10 percent of any loss. Premier certified 
lenders must maintain that deposit throughout the life of the loan, 
even as the loan matures, the debenture is paid down, and the risk is 
reduced.
  This requirement has resulted in the accumulation of unnecessarily 
high loan loss reserve funds for some premier lenders. In addition, it 
has deterred additional premier certified lenders from participating in 
the program at all.
  Mr. Speaker, my bill simply allows these premier lenders the option 
of creating risk-based loan loss reserves. It includes several 
safeguards to ensure that these companies do not make bad loans and put 
Federal taxpayers at risk. Specifically, premier certified lenders must 
maintain no less than $100,000 in their loan loss reserve funds; they 
must employ 3rd-party auditors to review their reserve funds on a 
quarterly basis; their auditors must be approved by the SBA; and the 
PCL must meet SBA performance benchmarks to retain their eligibility to 
hold risk-based loan loss reserve funds.
  Mr. Speaker, I want to sincerely thank Mr. Manzullo, my friend and 
the Chairman of the Small Business Committee, for working with me to 
get the bill to this point. I also want to thank the Ranking Member, 
Ms. Velazquez for her valuable input, and Mrs. Christensen for 
representing Ms. Velazquez on the floor today. Finally, I want to 
express my gratitude to the Chairman's and Ranking Member's staff, as 
well as my staff, for putting in so much time and energy into this 
effort.
  I encourage my colleagues to support our Nation's small businesses by 
supporting this important legislation.
  Mr. Speaker, I very much appreciate the bipartisan cooperation we 
have had on this, and I urge the passage of the bill.
  Mrs. CHRISTENSEN. Mr. Speaker, I yield such time as he may consume to 
the gentleman from Illinois (Mr. Davis).
  Mr. DAVIS of Illinois. Mr. Speaker, let me first of all thank the 
gentlewoman from the Virgin Islands for yielding me this time. I also 
want to commend the chairman, the gentleman from Illinois (Mr. 
Manzullo), and the ranking member, the gentlewoman from New York (Ms. 
Velazquez), for bringing this legislation to the floor and getting us 
to this point.
  When we talk about small businesses and we talk about the development 
of small business, one of the primary problems that people face is 
finding enough money to actually get a business off the ground, keep it 
going, keep it moving, have enough capital to actually carry the 
business on until they reach the point where they have the kind of cash 
flow and they have the kind of returns that they know they need in 
order to be stable and keep being successful. This PCLP Improvement Act 
helps to do all of that. It helps to make capital available and it 
gives people assistance to acquire what they actually need.
  While it is true, Mr. Speaker, that some of the best things in life 
are free, I remember the song that says ``But you can give it to the 
birds and bees, what I need is money.'' And what small businesses need 
is capital to help them grow, develop and flourish. This legislation 
helps to do that.
  Again I commend Chairman Manzullo, my colleague from Illinois, and 
the ranking member for bringing this to the floor.
  Mr. MANZULLO. Mr. Speaker, I reserve the balance of my time.
  Mrs. CHRISTENSEN. Mr. Speaker, I yield myself the balance of my time.
  Mr. Speaker, small businesses today face many barriers to achieving 
their success. Today's legislation helps address one of the most 
significant barriers faced by small businesses: Access to capital. The 
bill before us today will make more capital available to small 
businesses, spurring economic development in our Nation's communities.
  While today's legislation fixes a problem with the 504 program, it is 
only a stopgap measure. Even after we pass this legislation, small 
businesses will still have to endure SBA's inconsistent and 
bureaucratic 504 loan processing procedures. As such, today's 
legislation is the first of several near-term steps to centralize, 
streamline, and modernize the 504 program so that it is better able to 
meet the needs of our small businesses. First among these steps is this 
year's SBA reauthorization, in which we will address many of these 
deficiencies in order to help our country's small businesses access 
capital more readily.
  Mr. Speaker, I would like to take this moment to thank Adam 
Minehardt, a Democratic staff member of the Committee on Small 
Business, and Greg Orlando, a staff member for the gentleman from 
California (Mr. Doolittle), for their work on this important 
legislation. I also wish to thank the gentleman from California

[[Page 15800]]

(Mr. Doolittle) once again for bringing it to the committee, and our 
chairman and ranking member for their leadership on this bill and all 
the others we have worked on this year. This bill is truly a bipartisan 
product and the work reflects that spirit.
  Mr. Speaker, I again urge the adoption of this legislation.
  Ms. MILLENDER-McDONALD. Mr. Speaker, I rise today to offer my support 
for H.R. 923, the Premier Certified Lenders Program Act of 2003.
  Mr. Speaker, small business owners all over this nation have long 
been faced with a number of hurdles that limit their ability to be 
successful. Health care costs have risen at an astronomical rate, 
Federal regulations are being issued that establish competitive 
advantages for large firms, and, perhaps most importantly, access to 
capital is extremely limited.
  In an attempt to address concerns about small business financing 
issues, 3 years ago Congress established the Premier Certified Lenders 
Program (PCLP) as a permanent Small Business Administration program.
  The PCLP delegates substantial authority and autonomy to selected 
Certified Development Companies (CDCs) participating in the Small 
Business Administration's 504 Loan Program to offer long-term, fixed-
rate financing for major fixed assets such as land and buildings.
  My district is home to a CDC, the Long Beach Area Certified 
Development Corporation, and it serves the Cities of Long Beach, Signal 
Hill and Southern Los Angeles County. Ms. Regina Grant Peterson does an 
excellent job in reaching out to my constituents, doing all she can to 
promote economic development in the community.
  Currently, because of antiquated laws, CDCs participating in the PCLP 
must keep financial reserves in excess of what is actually necessary to 
safeguard against potential losses, and are not allowed to withdraw 
from these reserves until loans are paid in full.
  This severely limits the lending potential of these entities, costing 
small businesses nationwide millions of dollars in unused capital.
  H.R. 923 addresses this issue by allowing participating lenders to 
withdraw from their loan loss reserves attributable to the payment of 
principal on outstanding loans.
  In addition, the legislation would also create a Bureau of Lender 
Oversight within SBA that will oversee the calculation of loan loss 
reserves, thereby insuring that government monies are used 
appropriately.
  Mr. Speaker, as a Ranking Member of the Small Business Committee, I 
enthusiastically support this measure, and I support its swift passage.
  Mrs. CHRISTENSEN. Mr. Speaker, I yield back the balance of my time.
  Mr. MANZULLO. Mr. Speaker, I yield back the balance of my time.
  The SPEAKER pro tempore (Mr. Petri). The question is on the motion 
offered by the gentleman from Illinois (Mr. Manzullo) that the House 
suspend the rules and pass the bill, H.R. 923, as amended.
  The question was taken.
  The SPEAKER pro tempore. In the opinion of the Chair, two-thirds of 
those present have voted in the affirmative.
  Mr. MANZULLO. Mr. Speaker, on that I demand the yeas and nays.
  The yeas and nays were ordered.
  The SPEAKER pro tempore. Pursuant to clause 8 of rule XX and the 
Chair's prior announcement, further proceedings on this motion will be 
postponed.

                          ____________________