[Congressional Record (Bound Edition), Volume 151 (2005), Part 19]
[Senate]
[Page 26132]
[From the U.S. Government Publishing Office, www.gpo.gov]




                       DEFENSE AUTHORIZATION ACT

  Mr. KERRY. Mr. President, drought continues to be a serious problem 
for many states in this country, and I am very pleased that yesterday, 
as part of the National Defense Authorization Act for Fiscal Year 2006, 
we passed legislation that will help small businesses in those States 
that have been hurt by drought. I thank Senators Levin and Warner, and 
their staffs, for their help in moving drought relief one step closer 
to enactment.
  This legislation helps small businesses that need disaster assistance 
but can not get it through the Small Business Administration's disaster 
loan program. You see, the SBA does not 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. Just 
ask the many small businesses on Lake Mead, outside of Las Vegas, that 
met with the committee in July: fishing guides that struggle to find 
ramps that still reach the water to launch their boats; boat 
dealerships in the county that have lost an estimated $100 million in 
sales because recreation at the lake is down; marinas paying millions 
to move their docks, buildings, and utilities, trying to ``chase the 
water.'' The area usually gets 8 to 10 million visitors a year. 
However, the impact of drought on Lake Mead has had a serious adverse 
impact on the regional economy, exceeding $1 billion according to local 
officials. Lake Michigan has suffered similar economic losses, and its 
delegation has been pushing for small business relief for years. 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, in July of 2002, when this legislation was 
originally introduced, the SBA had in effect drought disaster 
declarations in 36 States. As of today, 17 States are under SBA drought 
disaster declarations: Wisconsin, Tennessee, Kentucky, Virginia, 
Montana, Oregon, Nebraska, South Dakota, Iowa, Oklahoma, Illinois, 
Arkansas, Louisiana, Mississippi, Texas, Kansas, and California. Adding 
insult to injury, in those States where the agency declares drought 
disasters, it limits assistance to only farm-related small businesses. 
Take, for instance, South Carolina. A couple of years ago that entire 
State had been declared a disaster by the SBA, but the administration 
would not help all drought victims. Let me read to you from the 
declaration:

       Small businesses located in all 46 counties may apply for 
     economic injury disaster loan assistance through the SBA. 
     These are working capital loans to help the business continue 
     to meet its obligations until the business returns to normal 
     conditions. . . . Only small, non-farm agriculture dependent 
     and small agricultural cooperatives are eligible to apply for 
     assistance. Nurseries are also eligible for economic injury 
     caused by drought conditions.

  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 provision that passed yesterday as part of the 
Defense Authorization Act--and that I introduced this July as the Small 
Business Drought Relief Act of 2005 S. 1463--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.
  This legislation has been thoroughly reviewed, passing the committee 
of jurisdiction and the full Senate three times, with supporters 
numbering up to 25, from both sides of the aisle. In addition to 
approval by the committee of jurisdiction, OMB, the Office of 
Management and Budget, approved virtually identical legislation in 
2003. The legislation passed yesterday includes those changes we worked 
out with the administration, and I see no reason why this should not be 
retained in the final conference report and sent to the President for 
his signature.
  I thank Senators Snowe and Bond, our current and past chairs, both of 
whom have been supportive of this legislation each time it was 
introduced and passed. And I again thank Senators Levin and Warner.

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