To amend the Robert T. Stafford Disaster Relief and Emergency Assistance Act to modify the terms of the community disaster loan program, and for other purposes.

Summary: Whatever It Takes to Rebuild Act, Part II - Repeals the Community Disaster Loan Act of 2005.

Amends the Robert T. Stafford Disaster Relief and Emergency Assistance Act to authorize the President to make community disaster loans to any state government which may suffer a substantial loss of tax and other revenue as a result of a major disaster, and has demonstrated a need for financial assistance in order to perform its governmental functions.

Removes the $5 million cap set for community disaster loans.

Provides that in the case of a community disaster loan made to a state or local government which suffers a substantial loss of tax and other revenues as a result of a major disaster the President determines to be an incident of national significance: (1) the amount of the loan shall not be subject to the current limitation of 25% of the annual operating budget of that state or local government for the fiscal year in which the major disaster occurs; and (2) the President shall not require the payment of any interest or principal on a loans.

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Whatever It Takes to Rebuild Act, 
Part II''.

SEC. 2. FINDINGS.

    Congress finds the following:
            (1) Major disasters, including natural disasters and 
        disasters caused by terrorist acts, often result in a decline 
        in economic activity in areas affected by the disaster and a 
        reduction in tax collections by State and local governments 
        serving those areas.
            (2) A report of the Government Accountability Office 
        entitled ``September 11: Recent Estimates of Fiscal Impact of 
        2001 Terrorist Attack on New York'', dated March 2005, 
        confirmed prior estimates that--
                    (A) New York City lost between $2,500,000,000 and 
                $2,900,000,000 in tax revenues for fiscal years 2002 
                and 2003; and
                    (B) the State of New York lost $2,900,000,000 for 
                fiscal years 2002 and 2003.
            (3) The impact of Hurricane Katrina on State and local tax 
        revenues is not yet known, but the impact is believed to be 
        extensive.
            (4) Under the community disaster loan program (in this 
        section referred to as the ``CDL program''), as authorized by 
        the Robert T. Stafford Disaster Relief and Emergency Assistance 
        Act, the President may make loans to a local government 
        suffering a substantial loss of tax and other revenues as a 
        result of a major disaster, if the local government 
        demonstrates a need for financial assistance in order to 
        preform its governmental function.
            (5) The President may cancel the repayment of all or any 
        part of a loan made to a local government under the CDL program 
        if revenues following the disaster are insufficient to meet the 
        operating budget of that local government as a result of 
        disaster-related revenue losses and additional unreimbursed 
        disaster-related municipal operating expenses. In the case of a 
        major disaster designated as an incident of national 
        significance, including natural disasters and disasters caused 
        by terrorist acts, repayment of any interest or principal on a 
        loan made under the CDL program should not be required.
            (6) Assistance made available under the CDL program is 
        often instrumental in aiding the full recovery of a local 
        government following a major disaster.
            (7) The Disaster Mitigation Act of 2000 established a 
        $5,000,000 limitation on loans made to a local government under 
        the CDL program in connection with a major disaster. Before the 
        date of enactment of such Act, there was not any limitation on 
        the amount of such loans.
            (8) The $5,000,000 limitation is inequitable when applied 
        to a local government serving a largely populated area, such as 
        New York City, and when applied to an area that is completely 
        devastated by a major disaster (such as Orleans, St. Bernard, 
        and Plaquemines parishes in the State of Louisiana following 
        Hurricane Katrina), and is inconsistent with the objective of 
        the CDL program to provide meaningful assistance to a local 
        government recovering from a major disaster.
            (9) On October 4, 2005, the Mayor of New Orleans announced 
        that the city was laying off 3,000 city employees as a result 
        of reduced tax revenues following Hurricane Katrina.
            (10) On October 7, 2005, Congress passed and the President 
        signed into law the Community Disaster Loan Act of 2005 (Public 
        Law 109-88), which--
                    (A) made available $1,000,000,000 for making 
                community disaster loans to communities affected by 
                Hurricane Katrina or Hurricane Rita;
                    (B) waived the $5,000,000 limitation that is 
                generally applicable to community disaster loans with 
                respect to loans made to communities affected by 
                Hurricane Katrina or Hurricane Rita; and
                    (C) prohibited the forgiveness of community 
                disaster loans made to communities affected by 
                Hurricane Katrina or Hurricane Rita.
            (11) Repayment of community disaster loans has frequently 
        been forgiven under the Robert T. Stafford Disaster Relief and 
        Emergency Assistance Act, and the prohibition on forgiveness 
        contained in the Community Disaster Loan Act of 2005 is the 
        first time such a prohibition has applied to such loans.

SEC. 3. REPEAL.

    The Community Disaster Loan Act of 2005 (Public Law 108-88) is 
repealed.

SEC. 4. COMMUNITY DISASTER LOANS.

    (a) Eligibility of States.--Section 417 of the Robert T. Stafford 
Disaster Relief and Emergency Assistance Act (42 U.S.C. 5184) is 
amended by striking ``local government'' each place it appears and 
inserting ``State or local government''.
    (b) Amount.--Section 417(b) of such Act (42 U.S.C. 5184(b)) is 
amended--
            (1) by striking ``based on need, shall'' and inserting 
        ``based on need and shall''; and
            (2) by striking ``, and shall not exceed $5,000,000''.
    (c) Incidents of National Significance.--Section 417 of such Act 
(42 U.S.C. 5184) is amended by adding at the end the following:
    ``(e) Incidents of National Significance.--
            ``(1) Loan terms.--In the case a loan made under this 
        section to a State or local government which may suffer a 
        substantial loss of tax and other revenues as a result of a 
        major disaster that the President determines to be an incident 
        of national significance--
                    ``(A) the amount of the loan shall not be subject 
                to the per centum limitation in subsection (b); and
                    ``(B) the President shall not require the payment 
                of any interest or principal on a loan.
            ``(2) Incident of national significance defined.--In this 
        subsection, the term `incident of national significance' has 
        the meaning such term has in the national response plan 
        established pursuant to section 502(6) of the Homeland Security 
        Act of 2002 (6 U.S.C. 312(6)).''.
    (d) Applicability.--The amendments made by this section shall apply 
with respect to any major disaster occurring on or after August 24, 
2005.
    (e) Authorization of Appropriations.--There is authorized to be 
appropriated for making community disaster loans under section 417 of 
such Act (42 U.S.C. 5184) to State and local governments which may 
suffer a substantial loss of tax and other revenues as a result of 
Hurricane Katrina or Hurricane Rita $1,000,000,000 and such additional 
sums as may be necessary.