To encourage initiatives for financial products and services that are appropriate and accessible for millions of American small businesses that do not have access to the financial mainstream.

Summary: Investing in America's Small Businesses Act of 2011 - Amends the Community Development Banking and Financial Institutions Act of 1994 to require the Community Development Financial Institutions Fund to make grants to community development financial institutions to enable such institutions to establish a loan-loss reserve fund to defray the costs of a small business loan program.

Defines "small business loan program" as a program in which a community development financial institution offers loans to small businesses that: (1) are made in amounts up to $25,000, (2) have no prepayment penalty, and (3) meet any affordability requirements established by Administrator of the Fund.

Requires a community development financial institution to provide non-federal matching funds equal to 50% of the amount of any grant received.

Prohibits the use of such grants to make direct loans to small businesses.

Permits a community development financial institution to use such a grant to: (1) help recapture a portion or all of a defaulted loan made under its small business loan program, and (2) designate and utilize a fiscal agent for services the agent normally provides.

Requires the Fund to make technical assistance grants to community development financial institutions to create, support, or maintain such a program.

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Investing in America's Small 
Businesses Act of 2011''.

SEC. 2. FINDINGS.

    The Congress finds the following:
            (1) Small businesses in underserved areas have for 
        generations been unable to access affordable credit.
            (2) The financial crisis of 2008 only served to exacerbate 
        efforts by entrepreneurs to access capital for the purpose of 
        creating jobs and improving economic outcomes in the community.
            (3) The Create Jobs for USA campaign by Starbucks Coffee 
        Company and Opportunity Finance Network, through community 
        development financial institutions, will provide loans to 
        underserved small businesses and microenterprises to create and 
        sustain jobs throughout America. This will allow Americans to 
        help Americans create and sustain jobs, but will not be enough 
        to help our Nation's small businesses.
            (4) Small business investments revitalize communities by 
        creating jobs but also contribute to the local tax base, which 
        helps finance investments in schools, hospitals, 
        infrastructure, and public safety.
            (5) The Community Development Financial Institutions Fund, 
        an agency of the Federal Government located within the United 
        States Department of the Treasury, has reported that in 2010 
        alone, community development financial institutions awardees 
        originated loans or investments totaling more than $1 billion, 
        and financed almost 18,000 affordable housing units; more than 
        5,200 business and microenterprise loans; and created or 
        maintained over 25,000 jobs and leveraged $1.5 billion in 
        private investment.
            (6) The Community Development Financial Institutions Fund 
        awardees have almost tripled jobs created since 2007, making 
        almost 14,000 loans to small businesses on average each year, 
        representing an average investment of close to $1 billion 
        annually.
            (7) The Community Development Financial Institutions Fund 
        is well placed to complement the Create Jobs for USA campaign 
        through careful, targeted investments in community development 
        financial institutions for the purposes of improving economic 
        outcomes for underserved families across the country.

SEC. 3. GRANTS TO ESTABLISH LOAN-LOSS RESERVE FUNDS FOR SMALL BUSINESS 
              LENDING.

    (a) In General.--The Community Development Banking and Financial 
Institutions Act of 1994 (12 U.S.C. 4701 et seq.) is amended by adding 
at the end the following:

``SEC. 123. GRANTS TO ESTABLISH LOAN-LOSS RESERVE FUNDS FOR SMALL 
              BUSINESS LENDING.

    ``(a) Purposes.--The purposes of this section are--
            ``(1) to make financial assistance available from the Fund 
        in order to help community development financial institutions 
        defray the costs of operating small business loan programs, by 
        providing the amounts necessary for such institutions to 
        establish their own loan loss reserve funds to mitigate some of 
        the losses on such small business loan programs;
            ``(2) to encourage community development financial 
        institutions to establish and maintain small business loan 
        programs that would help provide borrowers access to mainstream 
        financial institutions and combat high cost small business 
        lending; and
            ``(3) to encourage community development financial 
        institutions to expand the development services they offer and 
        to serve new investment areas and new targeted populations.
    ``(b) Grants.--
            ``(1) Loan-loss reserve fund grants.--
                    ``(A) In general.--The Fund shall make grants to 
                community development financial institutions to enable 
                such institutions to establish a loan-loss reserve fund 
                in order to defray the costs of a small business loan 
                program established or maintained by such institution.
                    ``(B) Application.--A community development 
                financial institution that wishes to receive a grant 
                under this paragraph shall submit an application to the 
                Administrator in such form and manner and containing 
                such information as the Administrator may require.
                    ``(C) Matching requirement.--A community 
                development financial institution shall provide non-
                Federal matching funds in an amount equal to 50 percent 
                of the amount of any grant received under this 
                paragraph.
                    ``(D) Use of funds.--Any grant amounts received by 
                a community development financial institution under 
                this paragraph--
                            ``(i) may not be used by such institution 
                        to provide direct loans to small businesses;
                            ``(ii) may be used by such institution to 
                        help recapture a portion or all of a defaulted 
                        loan made under the small business loan program 
                        of such institution on or after the date of the 
                        enactment of this section; and
                            ``(iii) may be used to designate and 
                        utilize a fiscal agent for services normally 
                        provided by such an agent.
            ``(2) Technical assistance grants.--
                    ``(A) In general.--The Fund shall make technical 
                assistance grants to community development financial 
                institutions to create, support, or maintain a small 
                business loan program. Any grant amounts received under 
                this paragraph may be used for--
                            ``(i) technology, staff support, staff 
                        capacity building, and other costs associated 
                        with establishing, supporting, or maintaining a 
                        small business loan program; and
                            ``(ii) establishing, supporting, or 
                        maintaining technical assistance programs for 
                        borrowers.
                    ``(B) Application.--A community development 
                financial institution that wishes to receive a grant 
                under this paragraph shall submit an application to the 
                Administrator in such form and manner and containing 
                such information as the Administrator may require.
    ``(c) Reports.--For each fiscal year for which grants are made 
under this section, the Administrator shall submit a report to the 
Committee on Financial Services of the House of Representatives and the 
Committee on Banking, Housing, and Urban Affairs of the Senate 
containing a description of the activities funded and amounts 
distributed under this section for such fiscal year, as well as 
measurable results of such actions.
    ``(d) Authorization of Appropriations.--
            ``(1) In general.--There are authorized to be appropriated 
        to the Fund $25,000,000 for each of fiscal years 2012 to 2017 
        to carry out this section.
            ``(2) Administrative costs.--There are authorized to be 
        appropriated to the Fund $5,000,000 for each of fiscal years 
        2012 to 2017 for the administrative costs of carrying out this 
        section.
    ``(e) Definitions.--For purposes of this section:
            ``(1) Small business.--The term `small business' has the 
        meaning given the term `small business concern' under section 
        3(a) of the Small Business Act (15 U.S.C. 632(a)).
            ``(2) Small business loan program.--The term `small 
        business loan program' means a loan program wherein a community 
        development financial institution offers loans to small 
        businesses that--
                    ``(A) are made in amounts not exceeding $25,000;
                    ``(B) have no pre-payment penalty; and
                    ``(C) meet any other affordability requirements as 
                may be established by the Administrator.''.
    (b) Conforming Amendment.--The table of contents for the Riegle 
Community Development and Regulatory Improvement Act of 1994 is amended 
by inserting after the item relating to section 121 the following:

``Sec. 122. Grants to establish loan-loss reserve funds.
``Sec. 123. Grants to establish loan-loss reserve funds for small 
                            business lending.''.