Small Business Guaranteed Credit Enhancement Act of 1993

Summary: Small Business Guaranteed Credit Enhancement Act of 1993 - Amends the Small Business Act (the Act) to increase the FY 1993 and 1994 authorizations of appropriations for loans to State and local development companies for community business development programs. 
Authorizes the Small Business Administration (SBA) to:  (1) collect additional fees after August 31, 1995, on loans made under the Act which are sold on the secondary market; (2) permit participating lenders to charge a late fee to loan borrowers who fail to make timely payments; and (3) reduce the maximum loan guarantees on real estate loans above $155,000 and on loans made under the Preferred Lenders Program. 
Directs the SBA to study and report to the Congress on the effect of the SBA's authority to impose secondary market fees and to reduce loan guarantee percentages on the ability of small businesses; including minority- and woman-owned small businesses, to obtain financing and the viability of the secondary market in SBA guaranteed loans.  Terminates the SBA's authority to impose such fees and reduce such percentages as of FY 1996. 
Makes the following revisions with respect to the Microloan Demonstration Program (the provision of loans and grants to startup, newly established, or growing small businesses): (1) increases from $15,000 to $25,000 the maximum loan which may be guaranteed by an intermediary; (2) increases the maximum grant amounts to such intermediaries for such purpose; and (3) increases from three to seven percent the maximum appropriated amount which may be used for training purposes. 
Authorizes the SBA to make grants or enter into cooperative arrangements in order to carry out the Small Business Development Center Program.  Extends the authorization of appropriations for such Program through FY 1994.  Strikes a provision prohibiting regulations concerning the Program from being printed in the Federal Register. 
Revises the dates of conferences to be held by the National White House Conference on Small Business.  Extends through FY 1994 the authorization of appropriations for the National Women's Business Council and terminates the Council on November 30, 1995.

SECTION 1. SHORT TITLE; TABLE OF CONTENTS.

    (a) Short Title.--This Act may be cited as the ``Small Business 
Guaranteed Credit Enhancement Act of 1993''.
    (b) Table of Contents.--The table of contents for this Act is as 
follows:
Sec. 1. Short title; table of contents.
Sec. 2. General authorizations.
Sec. 3. Authority to impose secondary market fees.
Sec. 4. Penalties.
Sec. 5. Authority to reduce loan guarantee percentages.
Sec. 6. Study and report.
Sec. 7. Repealer.
Sec. 8. Microloan program amendments.
Sec. 9. Small Business Development Center Program.
Sec. 10. White House Conference on Small Business.
Sec. 11. National Women's Business Council.

SEC. 2. GENERAL AUTHORIZATIONS.

    Section 20 of the Small Business Act (15 U.S.C. 631 note) is 
amended--
        (1) in subsection (g)(2) by striking ``$7,030,000,000'' and by 
    inserting in lieu thereof ``$7,155,000,000'';
        (2) in subsection (g)(2) by striking ``$775,000,000'' and by 
    inserting in lieu thereof ``$900,000,000'';
        (3) in subsection (i)(2) by striking ``$8,083,000,000'' and by 
    inserting in lieu thereof ``$8,458,000,000''; and
        (4) in subsection (i)(2) by striking ``$825,000,000'' and by 
    inserting in lieu thereof ``$1,200,000,000''.

SEC. 3. AUTHORITY TO IMPOSE SECONDARY MARKET FEES.

    (a) Additional Guarantee Fees.--Section 5(g) of the Small Business 
Act (15 U.S.C. 634) is amended by striking paragraph (4) and by 
inserting in lieu thereof the following:
        ``(4)(A) The Administration may collect the following fees for 
    loan guarantees sold into the secondary market pursuant to the 
    provisions of subsection (f): an amount equal to (A)
    not more than \4/10\ of one percent per year of the outstanding 
    principal amount of the portion of such loan guaranteed by the 
    Administration, and (B) not more than 50 percent of the portion of 
    the sale price which is in excess of 110 percent of the outstanding 
    principal amount of the portion of such loan guaranteed by the 
    Administration. Any such fees imposed by the Administration shall be 
    collected by the Administration or by the agent which carries out on 
    behalf of the Administration the central registration functions 
    required by subsection (h) of this section and shall be paid to the 
    Administration and used solely to reduce the subsidy on loans 
    guaranteed under section 7(a) of this Act: Provided, That such fees 
    shall not be charged to the borrower whose loan is guaranteed: and, 
    Provided further, That nothing herein shall preclude any agent of 
    the Administration from collecting a fee approved by the 
    Administration for the functions described in subsection (h)(2).
        ``(B) The Administration is authorized to impose and collect, 
    either directly or through a fiscal and transfer agent, a reasonable 
    penalty on late payments of the fee authorized under subparagraph 
    (A) in an amount not to exceed 5 percent of such fee per month plus 
    interest.''.
    (b) Any new fees imposed by the Administration pursuant to the 
authority conferred by subsection (a) shall be applicable only to loans 
initially sold in the secondary market pursuant to the provisions of 
section 5(f) of the Small Business Act after August 31, 1993.

SEC. 4. PENALTIES.

    Section 7(a) of the Small Business Act (15 U.S.C. 636(a)) is amended 
by adding at the end the following new paragraph:
        ``(22) The Administration is authorized to permit participating 
    lenders to impose and collect a reasonable penalty fee on late 
    payments of loans guaranteed under this subsection in an amount not 
    to exceed 5 percent of the monthly loan payment per month plus 
    interest.''.

SEC. 5. AUTHORITY TO REDUCE LOAN GUARANTEE PERCENTAGES.

    (a) Guarantee Percentages.--Section 7(a)(2) of the Small Business 
Act (15 U.S.C. 636) is amended--
        (1) by striking from the end of clause (B)(i) the word ``and'' 
    and by redesignating clause (B)(ii) as (B)(iv) and by inserting the 
    following after clause (B)(i):
            ``(ii) not less than 75 percent of the financing outstanding 
        at the time of disbursement, if such financing is more than 
        $155,000 and the period of maturity of such financing is more 
        than 10 years, except that the participation by the 
        Administration may be reduced below 75 percent upon request of 
        the participating lender;
            ``(iii) not less than 85 percent of the financing 
        outstanding at the time of disbursement, if such financing is 
        more than $155,000 and the period of maturity of such financing 
        is 10 years or less, except that the participation by the 
        Administration may be reduced below 85 percent upon request of 
        the participating lender; and'';
        (2) by striking the words ``85 percent under subparagraph (B)'' 
    and by inserting in lieu thereof the following: ``the above 
    specified percentums'';
        (3) by striking from paragraph (B) the words ``not less than 80 
    percent, except upon'' and by inserting in lieu thereof the 
    following: ``not less than 70 percent, unless a lesser percent is 
    required by clause (B)(ii) or upon the''; and
        (4) by inserting after the third sentence the following: ``The 
    maximum interest rate for a loan guaranteed under the Preferred 
    Lenders Program shall not exceed the maximum interest rate, as 
    determined by the Administration, which is made applicable to other 
    loan guarantees under section 7(a).''.
    (b) Application.--Notwithstanding any other provision of law, the 
amendments made by subsection (a) shall be effective September 1, 1993, 
but shall not be applicable to loan guarantee applications received by 
the Administration prior to August 21, 1993. In order to determine the 
percent of the loan to be guaranteed pursuant to the amendments made by 
subsection (a), the Administration shall aggregate the outstanding 
guaranteed principal of multiple loan guarantees issued on behalf of the 
same borrower.

SEC. 6. STUDY AND REPORT.

    The Administration shall study, monitor and evaluate the impact of 
the amendments made by sections 3 and 5 of this Act on the ability of 
small business concerns and small business concerns owned and controlled 
by minorities and women, to obtain financing and the impact of such 
sections on the effectiveness, viability and growth of the secondary 
market authorized by section 5(f) of the Small Business Act. Not later 
than 16 months after the date of enactment, and annually thereafter, the 
Administration shall submit to the Committees on Small Business of the 
Senate and the House of Representatives a report containing the 
Administration's findings and recommendations on such impact, 
specifically including changes in the interest rates on financings 
provided to small business concerns and small business concerns owned 
and controlled by minorities and women, through the use of the secondary 
market. The Administration shall segregate such findings and 
recommendations in the study according to the ethnic and gender 
components in these categories. Solely for the purposes of the study 
authorized herein, the term ``small business concerns owned and 
controlled by minorities'', includes businesses owned and controlled by 
individuals belonging to one of the designated groups listed in section 
8(d)(3)(C) of the Small Business Act.

SEC. 7. REPEALER.

    Sections 3 and 5 of this Act are hereby repealed on September 30, 
1996.

SEC. 8. MICROLOAN PROGRAM AMENDMENTS.

    Section 7(m) of the Small Business Act (15 U.S.C. 636(m)) is 
amended--
        (1) in paragraph (1)(B)(iii), by striking ``$15,000'' and 
    inserting ``$25,000'';
        (2) in paragraph (5)(A), by striking ``6 grants'' and inserting 
    ``25 grants for terms of up to 5 years''; and
        (3) in paragraph (9)(B) by striking ``3 percent'' and inserting 
    ``7 percent''.

SEC. 9. SMALL BUSINESS DEVELOPMENT CENTER PROGRAM.

    (a) Clearinghouse.--Section 21(c)(7) of the Small Business Act (15 
U.S.C. 648) is amended by striking ``system which will'' and by 
inserting in lieu thereof the following: ``system. Subject to amounts 
approved in advance in appropriations Acts, the Administration may make 
grants or enter cooperative agreements with one or more centers to carry 
out the provisions of this paragraph. Said grants or cooperative 
agreements shall be awarded for periods of no more than five years 
duration. The matching funds provisions of subsection (a) shall not be 
applicable to grants or cooperative agreements under this paragraph. The 
system shall''.
    (b) Authorization.--Section 25(i) of the Small Business Act (15 
U.S.C. 652) is amended by striking ``$8,000,000 for fiscal year 1993'' 
and by inserting in lieu thereof ``$2,000,000 for each of fiscal years 
1993 and 1994''.
    (c) Regulations.--Section 223 of the Small Business Credit and 
Business Opportunity Enhancement Act of 1992 (15 U.S.C. 631 note) is 
amended by striking the last sentence of subsection (b).

SEC. 10. WHITE HOUSE CONFERENCE ON SMALL BUSINESS.

    The White House Conference on Small Business Authorization Act (15 
U.S.C. 631 note) is amended--
        (1) in section 2 by striking from subsection (a) ``not earlier 
    than January 1, 1994, and not later than April 1, 1994'' and by 
    inserting in lieu thereof ``not earlier than May 1, 1995, and not 
    later than September 30, 1995'';
        (2) in section 2 by striking from subsection (a) ``December 1, 
    1992'' and by inserting in lieu thereof ``March 1, 1994''; and
        (3) in section 5 by striking the second sentence of subsection 
    (a) and by inserting in lieu thereof the following: ``Subsequent to 
    the date of enactment of this Act, but not later than 30 days after 
    the date of enactment of this Act, the President shall select and 
    appoint eleven individuals to the Commission.''.

SEC. 11. NATIONAL WOMEN'S BUSINESS COUNCIL.

    Section 407 of the Women's Business Ownership Act of 1988 (15 U.S.C. 
631 note) is amended to read as follows:

``SEC. 407. AUTHORIZATION.

    ``(a) In General.--There are authorized to be appropriated to carry 
out this title--
        ``(1) $500,000 for fiscal year 1993; and
        ``(2) $500,000 for fiscal year 1994.
    ``(b) Limitation on Authority.--New spending authority or authority 
to enter into contracts as authorized in this Act shall be effective 
only to such extent and in such amounts as are provided in advance in 
appropriation Acts.
    ``(c) Sunset.--This section shall cease to be effective on November 
30, 1995.''.







                                Speaker of the House of Representatives.







                             Vice President of the United States and    
                                                President of the Senate.