[Senate Report 113-91]
[From the U.S. Government Publishing Office]


                                                       Calendar No. 169
113th Congress                                                   Report
                                 SENATE
 1st Session                                                     113-91

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   THE COMMUNICATING LENDER ACTIVITY REPORTS FROM THE SMALL BUSINESS 
                 ADMINISTRATION (CLEAR SBA) ACT OF 2013

                                _______
                                

               September 10, 2013.--Ordered to be printed

                                _______
                                

        Ms. Landrieu, from the Committee on Small Business and 
               Entrepreneurship, submitted the following

                              R E P O R T

                         [To accompany S. 537]

    The Committee on Small Business and Entrepreneurship, 
having considered the bill (S. 537) to require the Small 
Business Administration to make information relating to lenders 
making covered loans publicly available, and for other 
purposes, reports favorably thereon, with amendments, and 
recommends that the bill, as amended, do pass.

                            I. INTRODUCTION

    The CLEAR SBA Act (S. 537) was introduced by the 
Committee's Chair, Senator Mary L. Landrieu, on March 12, 2013.
    The CLEAR SBA Act requires the Small Business 
Administration (SBA) to establish a searchable online database, 
known as a ``Lender Activity Index,'' to provide consumers with 
more transparent, user-friendly data about local SBA lenders.
    During the markup of the bill, the Risch-Landrieu amendment 
to the bill was approved unanimously by voice vote. The Risch-
Landrieu amendment provides that the SBA may not increase the 
burden on lenders in order to comply with the bill. The 
amendment also asserts that it is the sense of Congress that no 
additional funding will be made available to carry out this 
program. The bill, as amended, was also approved unanimously by 
voice vote.

              II. HISTORY (PURPOSE & NEED FOR LEGISLATION)

    The Small Business Administration (SBA) administers several 
loan programs to support small businesses, including its 
flagship 7(a) and 504/Certified Development Company (504/CDC) 
loan guaranty programs. By guaranteeing a portion of each loan, 
the SBA encourages banks and other lenders to make loans to 
small businesses who otherwise may not qualify for traditional 
financing options.
    In the past two fiscal years alone, SBA supported over $30 
billion in loans to approximately 60,000 small businesses each 
year through its 7(a) and 504/CDC loan guaranty programs. As of 
the end of Fiscal Year 2012, there were over 2,400 7(a) lenders 
and 273 Certified Development Companies nationwide. While the 
SBA currently releases some information publicly about SBA 
lending partners and activity, it is extremely difficult to 
find and comprehend for those who are not SBA lending 
professionals. If small business owners, local mayors, or 
governors want to determine SBA lending activity in their area, 
they lack the ability to do so easily.
    Through conversations with the SBA, small businesses, and 
SBA lenders, the Committee conceived the idea of a ``Lender 
Activity Index,'' an online, searchable database established by 
the SBA on its website to provide consumers with more 
transparent, user-friendly data about their local SBA lenders. 
Potential borrowers will be able to see which banks in their 
area provide SBA loans, and with this information, approach 
those banks. The Committee believes that the Lender Activity 
Index is a common-sense proposal to increase transparency and 
accountability at the SBA, simplify the process of obtaining a 
loan, and ultimately put more capital in the hands of America's 
small businesses.
    Senator Landrieu included a provision providing for a 
Lender Activity Index in Senate Amendment 2521 (S. Amdt. 2521), 
which she filed to S. 2237, the Small Business Jobs and Tax 
Relief Act of 2012, on July 11, 2012. Division B of S. Amdt. 
2521, entitled the Success Ultimately Comes from Capital, 
Contracting, Education, Strategic Partnerships, and Smart 
Regulations (SUCCESS) Act, included the language identical to 
the CLEAR SBA Act as a portion of Title II. Although it came up 
short of the 60 votes needed to end debate, the amendment 
received a strong 57 bipartisan votes, including five 
Republicans, when it received a vote on the Senate floor on 
July 12, 2012. Shortly thereafter, Chair Landrieu filed the 
SUCCESS Act as a standalone bill. On July 25, 2012, Chair 
Landrieu introduced S. 3442, the SUCCESS Act of 2012, with 
eight co-sponsors including Committee members Senator Cardin 
and Senator Shaheen, as well as Senators Blumenthal, Boxer, 
Gillibrand, Lieberman, Merkley, and Whitehouse.
    Ultimately, however, none of the bills or amendments made 
it to the President's desk during the 112th Congress.

                      III. HEARINGS & ROUNDTABLES

    In the 112th Congress:
    On November 29, 2012, the Committee held a hearing 
entitled, ``Creating Jobs and Growing the Economy: Legislative 
Proposals to Strengthen the Entrepreneurial Ecosystem.'' The 
purpose of the hearing was to discuss the legislative proposals 
included in the ``Success Ultimately Comes from Capital, 
Contracting, Education, Strategic Partnerships, and Smart 
Regulation (SUCCESS) Act of 2012'' (S. 3442), which was the 
result of recommendations gathered during a series of three 
Committee roundtables examining the entrepreneurial ecosystem 
during the 112th Congress. Among the provisions that the 
Committee examined during the hearing was Section 231, which 
provided for the Lender Activity Index and would later comprise 
the CLEAR SBA Act of 2013.
    In the 113th Congress:
    On March 14, 2013, the Committee held a roundtable entitled 
``Helping Small Businesses Weather Economic Challenges & 
Natural Disasters: Review of Legislative Proposals on Access to 
Capital and Disaster Recovery.'' The purpose of the roundtable 
was to discuss four legislative proposals on small business 
access to capital and disaster recovery on which the Committee 
would focus during the beginning of the 113th Congress, 
including the CLEAR SBA Act. Participants included a wide range 
of small business owners, investors, and stakeholders, and SBA 
representatives, including the Associate Administrator for the 
SBA's Office of Capital Access. The roundtable followed up on 
previous Committee roundtables and legislative hearings held 
during the 112th Congress and provided an opportunity for 
Committee members to highlight their relevant priorities ahead 
of an upcoming markup on access to capital and disaster 
recovery legislation.

                        IV. DESCRIPTION OF BILL

    Section 2 of the bill requires the SBA to post a user 
friendly Lender Activity Index on the SBA website. Users will 
be able to access the following data for any given bank: name 
of bank or Certified Development Company (CDC), number of SBA 
loans each lender made, total dollar amount of SBA loans of 
each bank or CDC, zip code of lender activity (zip code of 
borrower), industries lent to (hospitality, manufacturing, 
service, software, etc.), stage of business cycle (new or 
existing business), and other business specific information 
(i.e. Women Owned Businesses, Minority Owned Businesses, or 
Veteran Owned Businesses). Data will be available for the year 
to date and users will be able to compare to 3 previous fiscal 
years. Both quarterly and annual data will be included.
    The Risch-Landrieu amendment to the bill also stipulates 
that in creating the Lender Activity Index, the SBA cannot 
require additional paperwork from lenders or otherwise increase 
the burden on them in any way. Furthermore, the SBA is expected 
to use existing funds to create the database. Thus, the Lender 
Activity Index comes at no cost to taxpayers.

                           V. COMMITTEE VOTE

    In compliance with rule XXVI (7)(b) of the Standing Rules 
of the Senate, the following vote was recorded on June 17, 
2013.
    A motion to adopt the Communicating Lender Activity Reports 
from the Small Business Administration Act, a bill to require 
the Small Business Administration to make information related 
to lenders making covered loans publicly available, as amended 
by the Risch-Landrieu amendment, was approved unanimously by 
voice vote with the following Senators present: Landrieu, 
Risch, Levin, Cantwell, Pryor, Cardin, Shaheen, Hagan, 
Heitkamp, Cowan, Rubio, Scott, Fischer, and Johnson (WI).

                           VI. COST ESTIMATE

    In compliance with rule XXVI(11)(a)(1) of the Standing 
Rules of the Senate, the Committee estimates the cost of the 
legislation will be equal to the amounts discussed in the 
following letter from the Congressional Budget Office:

                                                    August 1, 2013.
Hon. Mary L. Landrieu,
Chair, Committee on Small Business and Entrepreneurship,
U.S. Senate, Washington, DC.
    Dear Madam Chair: The Congressional Budget Office has 
prepared the enclosed cost estimate for S. 537, the 
Communicating Lending Activity Reports from the Small Business 
Administration Act.
    If you wish further details on this estimate, we will be 
pleased to provide them. The CBO staff contact is Susan Willie.
            Sincerely,
                                              Douglas W. Elmendorf.
    Enclosure.

S. 537--Communicating Lending Activity Reports from the Small Business 
        Administration Act

    S. 537 would require the Small Business Administration 
(SBA) to develop a database that tracks information about 
lenders that participate in the agency's loan guarantee 
programs and the loans they have made under those programs 
(``covered loans''). The database would contain information, 
such as the name of the lender, the number and total dollar 
amount of covered loans made by the lender, whether the loans 
are made for existing or new businesses, and the SBA program 
that provided the guarantee for the loans. The SBA would be 
required to collect this information for fiscal years 2009 
through 2013 and to make it available on the agency's website.
    Based on information from the SBA, CBO expects that lender 
data already collected by the agency would be sufficient to 
meet the bill's information collection requirements and that 
the cost to present that information on the agency's website 
would be insignificant. Therefore, CBO estimates that 
implementing S. 537 would not have a significant effect on 
spending subject to appropriation. Enacting S. 537 would not 
affect direct spending or revenues; therefore, pay-as-you-go 
procedures do not apply.
    S. 537 contains no intergovernmental or private-sector 
mandates as defined in the Unfunded Mandates Reform Act and 
would not affect the budgets of state, local, or tribal 
governments.
    The CBO staff contact for this estimate is Susan Willie. 
The estimate was approved by Theresa Gullo, Deputy Assistant 
Director for Budget Analysis.

                  VII. EVALUATION OF REGULATORY IMPACT

    In compliance with rule XXVI(11)(b) of the Standing Rules 
of the Senate, it is the opinion of the Committee that no 
significant additional regulatory impact will be incurred in 
carrying out the provisions of this legislation. There will be 
no additional impact on the personal privacy of companies or 
individuals who utilize the services provided.

                   VIII. SECTION-BY-SECTION ANALYSIS


Section 1. Title

    This section provides the title of the bill. This Act may 
be cited as the ``Communicating Lender Activity Reports from 
the Small Business Administration Act'' or the ``CLEAR SBA 
Act.''

Section 2. SBA Lender Activity Index

    This section requires the SBA to create a user-friendly 
database of information about SBA lenders on its website, known 
as the Lender Activity Index. The database will include the 
following information for any given lender: name of bank or 
Certified Development Company (CDC), number of SBA loans each 
lender made, total dollar amount of SBA loans of each bank or 
CDC, zip code of lender activity, industries lent to, stage of 
business cycle, and other business specific information. Data 
will be available for the year to date, and users will be able 
to compare to 3 previous fiscal years. Both quarterly and 
annual data will be included. The section, as amended, also 
specifies that no additional paperwork burdens may be put on 
lenders in order to comply with the Lender Activity Index 
provision and states that the SBA is expected to use existing 
funds to create the database.

                                  
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