[Congressional Record (Bound Edition), Volume 149 (2003), Part 6]
[Senate]
[Pages 8017-8019]
[From the U.S. Government Publishing Office, www.gpo.gov]




             THE SMALL BUSINESS DROUGHT RELIEF ACT OF 2003

  Mr. KERRY. Mr. President, I rise to thank my colleagues for voting 
last night in favor of the Small Business Drought Relief Act of 2003. 
Time is of the essence for disaster victims; small businesses across 
the country have been waiting 8 months for Congress to take action and 
force the Small Business Administration to comply with the law and open 
its disaster loan program to them. They are frustrated, and 
understandably so.
  You see, the SBA doesn't treat all drought victims the same. The 
agency only helps those small businesses whose income is tied to 
farming and agriculture. However, farmers and ranchers are not the only 
small business owners whose livelihoods are at risk when drought hits 
their communities. The impact can be just as devastating to the owners 
of rafting businesses, marinas, and bait and tackle shops. Sadly, these 
small businesses cannot get help through the SBA's disaster loan 
program because of something taxpayers hate about government 
bureaucracy.
  The SBA denies these businesses access to disaster loans because its 
lawyers say drought is not a sudden event and therefore it is not a 
disaster by definition. However, contrary to the agency's position that 
drought is not a disaster, as of July 16, 2002, the day this 
legislation was introduced last year, the SBA had in effect drought 
disaster declarations in 36 States. That

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number has grown to 48, demonstrating that problem has gotten worse and 
even more small businesses are in need.
  As I have said time and again, the SBA has the authority to help all 
small businesses hurt by drought in declared disaster areas, but the 
agency won't do it. For years the agency has been applying the law 
unfairly, helping some and not others, and it is out of compliance with 
the law. The Small Business Drought Relief Act of 2003 would force SBA 
to comply with existing law, restoring fairness to an unfair system, 
and get help to small business drought victims that need it.
  I thank the Chair of the Committee on Small Business and 
Entrepreneurship, Senator Snowe, for all her work to ensure passage of 
this bill, as well as our many colleagues who are cosponsors--Senators 
Bond, Landrieu, Edwards, Johnson, Bingaman, Levin, Baucus, Daschle, 
Hollings, Lieberman, Warner, Crapo, Harkin, Reid, Allen, Bennett, and 
Enzi.
  Mr. President, I ask unanimous consent that letters of support from 
Governors who advocated prompt passage of this legislation last year be 
printed in the Record.
  There being no objection, the material was ordered to be printed in 
the Record, as follows:

                              Southern Governors' Association,

                                  Washington, DC, August 19, 2002.
     Hon. John Kerry,
     U.S. Senate, Russell Senate Office Building, Washington, DC.
       Dear Senator Kerry: We are deeply concerned that small 
     businesses in states experiencing drought are being 
     devastated by drought conditions that are expected to 
     continue through the end of the summer. We urge you to 
     support legislation that would allow small businesses to 
     protect themselves against the detrimental effects of 
     drought.
       Much like other natural disasters, the effects of drought 
     on local economies can be crippling. Farmers and farm-related 
     businesses can turn in times of drought to the U.S. 
     Department of Agriculture. However, non-farm small businesses 
     have nowhere to go, not even the Small Business 
     Administration (SBA), because their disaster loans are not 
     made available for damage due to drought.
       To remedy this omission, Sen. John Kerry (D-Mass.) 
     introduced the Small Business Drought Relief Act (S. 2734) on 
     July 16, 2002, to make SBA disaster loans available to those 
     small businesses debilitated by prolonged drought conditions. 
     This bill was passed by the Senate Small Business Committee 
     just eight days later. Also, the companion legislation (H.R. 
     5197) was introduced by Rep. Jim DeMint (R-S.C.) on July 24, 
     2002. Both bills are gaining bipartisan support, and we hope 
     you will cosponsor this important legislation and push for 
     its rapid enactment in the 107th Congress.
       As 11 southern states are presently experiencing moderate 
     to exceptional drought conditions this summer, we cannot 
     afford to wait to act. We urge you to cosponsor the Small 
     Business Drought Relief Act and push for its consideration as 
     soon as possible.
           Sincerely,
         Gov. Don Siegelman of Alabama; Gov. Mike Huckabee of 
           Arkansas; Gov. Roy E. Barnes of Georgia; Gov. Paul E. 
           Patton of Kentucky; Gov. M.J. ``Mike'' Foster, Jr. of 
           Louisiana; Gov. Parris N. Glendening of Maryland; Gov. 
           Ronnie Musgrove of Mississippi; Gov. Bob Holden of 
           Missouri; Gov. Michael F. Easley of North Carolina; 
           Gov. Frank Keating of Oklahoma; Gov. Jim Hodges of 
           South Carolina; Gov. Don Sundquist of Tennessee; Gov. 
           Rick Perry of Texas; Gov. Mark Warner of Virginia; Gov. 
           Bob Wise of West Virginia.
                                  ____



                                       Office of the Governor,

                                   Carson City, NV, July 23, 2002.
     Hon. John F. Kerry,
     Chairman, Committee on Small Business, Russell Building, 
         Washington, DC.
     Hon. Christopher Bond,
     Ranking Member, Committee on Small Business, Russell 
         Building, Washington, DC.
       Dear Senators Kerry and Bond: Much of Nevada and the Nation 
     have been experiencing extreme drought over the past several 
     years. In Nevada we have seen the effects of this situation 
     through catastrophic range and forest fires, insect 
     infestations and loss of crops and livestock.
       Prolonged drought causes a drastic reduction in stream and 
     river flow levels. This can cause the level of lakes to drop 
     so significantly that existing docks and boat ramps cannot 
     provided access to boats. In the case of range and forest 
     fires we have seen small innkeepers and hunting and fishing 
     related businesses that have their entire season wiped out in 
     a matter of a few hours.
       Unfortunately for some small businesses, drought assistance 
     is available only for agriculture related small businesses, 
     such as feed and seed stores. For businesses that are based 
     on tourism around lakes and rivers, there is currently no 
     drought assistance available.
       The Small Business Administration (SBA) is not currently 
     authorized to help these businesses because a drought is not 
     a sudden occurrence. Nonetheless, a drought is an ongoing 
     natural disaster that causes great damage to these small 
     businesses.
       I would like to lend my support to S. 2734. The Small 
     Business Drought Relief Act. This bill would amend the 
     guidelines and authorize the SBA to offer assistance to small 
     businesses affected by prolonged drought. With passage of 
     this bill, Governors would be allowed to ask SBA for an 
     administrative declarations of economic injury because of 
     drought. The low interest loans SBA can offer these 
     businesses would allow many of them to weather the drought 
     and remain economically viable for future operation.
           Sincerely,
                                                   Kenny C. Guinn,
     Governor.
                                  ____

                                          State of North Carolina,


                                       Office of the Governor,

                                       Raleigh, NC, July 18, 2002.
     Hon. John Edwards,
     U.S. Senate, Dirksen Senate Office Building, Washington, DC.
       Dear Senator Edwards: I am writing to thank you for your 
     support for legislation introduced in the Senate to add 
     drought as a condition for which small businesses may apply 
     for Small Business Administration Economic Injury Disaster 
     Loans.
       The Small Business Drought Relief Act (S. 2734) will 
     correct the current situation facing our small businesses in 
     North Carolina. SBA disaster assistance is not available 
     despite a historic drought that is impacting not just our 
     agriculture sector, but causing real business and revenue 
     losses, which threaten some firms with job layoffs or even 
     bankruptcy.
       These businesses need help, and access to low-interest SBA 
     loans can offer a lifeline to allow paying bills and making 
     payrolls until business returns to normal.
       I urge you to push for rapid action on this important 
     enhancement to SBA's ability to help our people through this 
     time of trouble.
       With kindest regards, I remain
           Very truly yours,
     Michael F. Easley.
                                  ____

                                          State of South Carolina,


                                       Office of the Governor,

                                       Columbia, SC, July 9, 2002.
     Hon. John Kerry,
     U.S. Senate, Russell Building, Washington, DC.
       Dear Senator Kerry: The State of South Carolina is in its 
     fifth year of drought status, the worst in over fifty years. 
     Some parts of the state are in extreme drought status and the 
     rest is in severe drought status.
       Ninty-nine percent of our streams are flowing at less than 
     10% of their average flow for this time of year. 60% of those 
     same streams are running at lowest flow on record for this 
     date. The levels of South Carolina's lakes have dropped 
     anywhere from five feet to twenty feet. Some lakes have 
     experienced a drop in water level so significant that tourist 
     and recreational use has diminished.
       State and national climatologists are not hopeful that we 
     will receive any significant rainfall in the near future. To 
     end our current drought, we would need an extended period of 
     average to above average rainfall.
       Droughts, particularly prolonged ones such as we are 
     experiencing now, have extensive economic effects. For 
     farmers who experience the economic effects of such a 
     drought, assistance is available through the USDA. For small 
     businesses, assistance is available only for agriculture 
     related small businesses, i.e. feed and seed stores. For 
     businesses that are based on tourism around Lakes and Rivers, 
     there is currently no assistance available.
       We have reports of lake and river tourism dependent 
     businesses experiencing 17% to 80% declines in revenue. The 
     average decline in revenue is probably near 50% across the 
     board.
       My staff has contacted Small Business Administration and 
     they are not authorized to offer assistance to these 
     businesses because a drought is not defined as a sudden 
     occurrence. Nonetheless, a drought is an ongoing natural 
     disaster that is causing great economic damage to these small 
     business owners.
       I am requesting that you assist us in this situation by 
     proposing that the Small Business and Entrepreneurship 
     Committee take action to at least temporarily amend the SBA 
     authorizing language and allow them to offer assistance to 
     small businesses affected by prolonged drought. This would 
     allow Governors to ask SBA for an administrative declaration 
     of economic injury because of drought. The low interest loans 
     SBA can offer these businesses would allow many of them to 
     weather the drought and remain in business for the long run.
       My staff has also been in contact with Senator Hollings' 
     legislative staff. I hope together, we can find an expedient 
     solution to the plight of these small business owners. Short 
     of finding a way to control the weather, this may be our only 
     option to help their dire situation.
           Sincerely,
                                                       Jim Hodges.


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