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[Congressional Bills 117th Congress]
[From the U.S. Government Publishing Office]
[S. 5102 Introduced in Senate (IS)]

<DOC>

117th CONGRESS
  2d Session
                                S. 5102

To authorize the Community Advantage Loan Program of the Small Business 
                Administration, and for other purposes.

_______________________________________________________________________

                   IN THE SENATE OF THE UNITED STATES

                           November 16, 2022

  Mr. Cardin introduced the following bill; which was read twice and 
    referred to the Committee on Small Business and Entrepreneurship

_______________________________________________________________________

                                 A BILL

 
To authorize the Community Advantage Loan Program of the Small Business 
                Administration, and for other purposes.

    Be it enacted by the Senate and House of Representatives of the 
United States of America in Congress assembled,

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Community Advantage Loan Program 
Permanency Act of 2022''.

SEC. 2. FINDINGS.

    Congress finds that--
            (1) capital access remains one of the largest barriers to 
        overcome for socially and economically disadvantaged business 
        owners as well as for the smallest small businesses;
            (2) according to the Double Jeopardy: COVID-19's 
        Concentrated Health and Wealth Effects in Black Communities 
        study conducted by the Federal Reserve banks, in 2020--
                    (A) firms owned by people of color are more likely 
                to have weak capitalizations, limited bank 
                relationships, and little in cash reserves; and
                    (B) 51 percent of Black-owned businesses have less 
                than 3 months of cash reserves in case of an emergency, 
                which is nearly 7 percentage points higher than their 
                peers;
            (3) according to the Small Business Credit Survey conducted 
        by the Federal Reserve banks, in 2021--
                    (A) 31 percent of firms that sought financing 
                received the full financing sought by the firm;
                    (B) firms owned by people of color were least 
                likely to receive the full amount of financing sought 
                by the firm, with 15 percent of Asian-owned businesses, 
                16 percent of Black-owned businesses, and 19 percent of 
                Hispanic-owned businesses receiving full financing, as 
                opposed to 35 percent of non-Hispanic White-owned 
                businesses receiving full financing; and
                    (C) firms with fewer employees were also least 
                likely to receive the full financing sought by the 
                firm, with 23 percent of businesses with 1 to 4 
                employees and 37 percent of businesses with 5 to 49 
                employees receiving full financing, as opposed to 55 
                percent of businesses with 50 to 499 employees 
                receiving full financing;
            (4) the Community Advantage Pilot Program of the Small 
        Business Administration has helped increase lending backed by 
        the Administration to firms owned by people of color, women, 
        and veterans and firms classified as start ups;
            (5) from fiscal year 2018 to fiscal year 2022--
                    (A) 13 percent of loans under the Community 
                Advantage Pilot Program went to Black business owners, 
                while 4 percent of loans under the loan program under 
                section 7(a) of the Small Business Act (15 U.S.C. 
                636(a)) (in this section referred to as the ``7(a) loan 
                program'') went to Black business owners;
                    (B) 15 percent of loans under the Community 
                Advantage Pilot Program went to Hispanic business 
                owners, while 8 percent of loans under the 7(a) loan 
                program went to Hispanic business owners;
                    (C) 20 percent of loans under the Community 
                Advantage Pilot Program went to women business owners, 
                while 17 percent of loans under the 7(a) loan program 
                went to women business owners; and
                    (D) 9 percent of loans under the Community 
                Advantage Pilot Program went to veteran business 
                owners, while 5 percent of loans under the 7(a) loan 
                program went to veteran business owners; and
            (6) from fiscal year 2020 to fiscal year 2021, 14 percent 
        of loans under the Community Advantage Pilot Program went to 
        startup business owners, while 7 percent of loans under the 
        7(a) loan program went to startup business owners.

SEC. 3. COMMUNITY ADVANTAGE LOAN PROGRAM.

    (a) In General.--Section 7(a) of the Small Business Act (15 U.S.C. 
636(a)) is amended by adding at the end the following:
            ``(38) Community advantage loan program.--
                    ``(A) Purposes.--The purposes of the Community 
                Advantage Loan Program are--
                            ``(i) to create a mission-oriented loan 
                        guarantee program that builds on the 
                        demonstrated success of the Community Advantage 
                        Pilot Program of the Administration, as 
                        established in 2011, to reach more underserved 
                        small business concerns;
                            ``(ii) to increase lending to small 
                        business concerns in underserved and rural 
                        markets, including veterans and members of the 
                        military community, socially and economically 
                        disadvantaged individuals, as described in 
                        paragraphs (5) and (6)(A) of section 8(a), 
                        respectively, women, and new businesses;
                            ``(iii) to ensure that the program under 
                        this subsection expands inclusion and more 
                        broadly meets congressional intent to reach 
                        borrowers who are unable to get credit 
                        elsewhere on reasonable terms and conditions;
                            ``(iv) to help underserved small business 
                        concerns become bankable by utilizing the small 
                        dollar financing and business support 
                        experience of mission-oriented lenders;
                            ``(v) to allow certain mission-oriented 
                        lenders, primarily financial intermediaries 
                        focused on economic development in underserved 
                        markets, access to guarantees for loans under 
                        this subsection (in this paragraph referred to 
                        as `7(a) loans') of not more than $350,000 and 
                        provide management and technical assistance to 
                        small business concerns as needed;
                            ``(vi) to provide certainty for the lending 
                        partners that make loans under this subsection 
                        and to attract new lenders;
                            ``(vii) to encourage collaboration between 
                        mission-oriented and conventional lenders under 
                        this subsection in order to support underserved 
                        small business concerns; and
                            ``(viii) to assist covered institutions 
                        with providing business support services and 
                        technical assistance to small business 
                        concerns, when needed.
                    ``(B) Definitions.--In this paragraph--
                            ``(i) the term `Community Advantage Network 
                        Partner'--
                                    ``(I) means a nonprofit, mission-
                                oriented organization that acts as a 
                                Referral Agent to covered institutions 
                                in order to expand the reach of the 
                                program to small businesses in 
                                underserved markets; and
                                    ``(II) does not include a covered 
                                institution making loans under the 
                                program;
                            ``(ii) the term `covered institution' means 
                        an entity that--
                                    ``(I) is--
                                            ``(aa) a development 
                                        company, as defined in section 
                                        103 of the Small Business 
                                        Investment Act of 1958 (15 
                                        U.S.C. 662), participating in 
                                        the 504 Loan Guaranty program 
                                        established under title V of 
                                        that Act (15 U.S.C. 695 et 
                                        seq.);
                                            ``(bb) a nonprofit 
                                        intermediary, as defined in 
                                        subsection (m)(11), 
                                        participating in the microloan 
                                        program under subsection (m);
                                            ``(cc) a non-Federally 
                                        regulated entity or a lending 
                                        institution certified as a 
                                        community development financial 
                                        institution by the Community 
                                        Development Financial 
                                        Institutions Fund established 
                                        under section 104(a) of the 
                                        Riegle Community Development 
                                        and Regulatory Improvement Act 
                                        of 1994 (12 U.S.C. 4703(a)); or
                                            ``(dd) an eligible 
                                        intermediary, as defined in 
                                        subsection (l)(1), 
                                        participating in the 
                                        Intermediary Lending Program 
                                        established under subsection 
                                        (l)(2); and
                                    ``(II) has approved and disbursed 
                                10 similarly sized loans in the 
                                preceding 24-month period and is 
                                servicing not less than 10 similarly 
                                sized loans to small business concerns 
                                in the portfolio of the entity;
                            ``(iii) the term `existing business' means 
                        a small business concern that has been in 
                        existence for not less than 2 years on the date 
                        on which a loan is made to the small business 
                        concern under the program;
                            ``(iv) the term `new business' means a 
                        small business concern that has been in 
                        existence for not more than 2 years on the date 
                        on which a loan is made to the small business 
                        concern under the program;
                            ``(v) the term `program' means the 
                        Community Advantage Loan Program established 
                        under subparagraph (C);
                            ``(vi) the term `Referral Agent' has the 
                        meaning given the term in section 103.1(f) of 
                        title 13, Code of Federal Regulations, or any 
                        successor regulation;
                            ``(vii) the term `rural area' means any 
                        county that the Bureau of the Census has 
                        defined as mostly rural or completely rural in 
                        the most recent decennial census; and
                            ``(viii) the term `small business concern 
                        in an underserved market' means a small 
                        business concern--
                                    ``(I) that is located in--
                                            ``(aa) a low- to moderate-
                                        income community;
                                            ``(bb) a HUBZone, as that 
                                        term is defined in section 
                                        31(b);
                                            ``(cc) a rural area; or
                                            ``(dd) any area for which a 
                                        disaster declaration or 
                                        determination described in 
                                        subparagraph (A), (B), (C), or 
                                        (E) of subsection (b)(2) has 
                                        been made that has not 
                                        terminated more than 2 years 
                                        before the date (or later, as 
                                        determined by the 
                                        Administrator) on which a loan 
                                        is made to the small business 
                                        concern under the program, 
                                        except that, in the case of a 
                                        major disaster described in 
                                        subsection (b)(2)(A), that 
                                        period shall be 5 years;
                                    ``(II) for which more than 50 
                                percent of the employees reside in a 
                                low- or moderate-income community;
                                    ``(III) that is a new business;
                                    ``(IV) owned and controlled by 
                                socially and economically disadvantaged 
                                individuals, as described in paragraphs 
                                (5) and (6)(A) of section 8(a), 
                                respectively, which the Administrator, 
                                in carrying out the program, shall 
                                presume includes Black Americans, 
                                Hispanic Americans, Native Americans, 
                                Asian Pacific Americans, and other 
                                minorities;
                                    ``(V) owned and controlled by 
                                women;
                                    ``(VI) owned and controlled by 
                                veterans or spouses of veterans;
                                    ``(VII) owned and controlled by a 
                                member of an Indian Tribe individually 
                                identified (including parenthetically) 
                                in the most recent list published 
                                pursuant to section 104 of the 
                                Federally Recognized Indian Tribe List 
                                Act of 1994 (25 U.S.C. 5131);
                                    ``(VIII) owned and controlled by an 
                                individual who has completed a term of 
                                imprisonment in a Federal, State, or 
                                local jail or prison;
                                    ``(IX) owned and controlled by an 
                                individual with a disability, as that 
                                term is defined in section 3 of the 
                                Americans with Disabilities Act of 1990 
                                (42 U.S.C. 12102); or
                                    ``(X) as otherwise determined by 
                                the Administrator.
                    ``(C) Establishment.--There is established a 
                Community Advantage Loan Program under which the 
                Administration may guarantee loans made by covered 
                institutions under this subsection, with an emphasis on 
                loans made to small business concerns in underserved 
                markets.
                    ``(D) Program levels.--In fiscal year 2023 and each 
                fiscal year thereafter, not more than 10 percent of the 
                number of loans guaranteed under this subsection may be 
                guaranteed under the program.
                    ``(E) Grandfathering of existing lenders.--Any 
                covered institution that actively participated in the 
                Community Advantage Pilot Program of the Administration 
                and is in good standing, as determined by the 
                Administration, on the day before the date of enactment 
                of this paragraph--
                            ``(i) shall retain designation in the 
                        program;
                            ``(ii) shall not be required to submit an 
                        application to participate in the program; and
                            ``(iii) for the purpose of determining the 
                        loan loss reserve amount of the covered 
                        institution, shall have participation in the 
                        Community Advantage Pilot Program included in 
                        the calculation under subparagraph (J).
                    ``(F) Requirement to make loans to underserved 
                markets.--Not less than 70 percent of loans made by a 
                covered institution under the program shall consist of 
                loans made to small business concerns in underserved 
                markets.
                    ``(G) Maximum loan amount.--The maximum loan amount 
                for a loan guaranteed under the program is $350,000.
                    ``(H) Interest rates.--The maximum allowable 
                interest rate prescribed by the Administration on any 
                financing made on a deferred basis pursuant to the 
                program shall not exceed the maximum allowable interest 
                rate under sections 120.213 and 120.214 of title 13, 
                Code of Federal Regulations, or any successor 
                regulations.
                    ``(I) Refinancing of community advantage program 
                loans.--A loan guaranteed under the program or 
                guaranteed under the Community Advantage Pilot Program 
                of the Administration may be refinanced into another 
                7(a) loan made by lender that does not participate in 
                the program.
                    ``(J) Loan loss reserve requirements.--
                            ``(i) Loan loss reserve account for covered 
                        institutions.--A covered institution--
                                    ``(I) with not more than 5 years of 
                                participation in the program shall 
                                maintain a loan loss reserve account 
                                with an amount equal to 5 percent of 
                                the outstanding amount of the 
                                unguaranteed portion of the loan 
                                portfolio of the covered institution 
                                under the program; and
                                    ``(II) with more than 5 years of 
                                participation in the program shall 
                                maintain a loan loss reserve account 
                                with an amount equal to the average 
                                repurchase rate of the covered 
                                institution over the preceding 36-month 
                                period.
                            ``(ii) Additional loan loss reserve amount 
                        for selling loans on the secondary market.--In 
                        addition to the amount required in the loan 
                        loss reserve account under clause (i), a 
                        covered institution that sells a program loan 
                        on the secondary market shall be required to 
                        maintain the following additional amounts in 
                        the loan loss reserve account:
                                    ``(I) An amount equal to 2 percent 
                                of the guaranteed portion of each 
                                program loan sold on the secondary 
                                market for lenders with less than 5 
                                years experience selling program loans 
                                on the secondary market.
                                    ``(II) An amount equal to the 
                                average repurchase rate for loans sold 
                                by the lender on the secondary market 
                                over the preceding 36 months for 
                                lenders with more than 5 years 
                                experience selling program loans on the 
                                secondary market.
                            ``(iii) Recalculation.--The loan loss 
                        reserve required under clauses (i) and (ii) 
                        shall be recalculated on October 1 of each 
                        year.
                    ``(K) Training.--The Administration--
                            ``(i) shall provide accessible upfront and 
                        ongoing training for covered institutions 
                        making loans under the program to support 
                        program compliance and improve the interface 
                        between the covered institutions and the 
                        Administration, which shall include--
                                    ``(I) guidance for following the 
                                regulations of the Administration; and
                                    ``(II) guidance specific to 
                                mission-oriented lending that is 
                                intended to help lenders effectively 
                                reach and support underserved small 
                                business concerns, including management 
                                and technical assistance delivery;
                            ``(ii) shall ensure that the training 
                        described in clause (i) is provided for free or 
                        at a low cost;
                            ``(iii) may enter into a contract to 
                        provide the training described in clause (i) 
                        with an organization with expertise in lending 
                        under this subsection and primarily 
                        specializing in mission-oriented lending, and 
                        lending to underserved markets; and
                            ``(iv) shall provide training for the 
                        employees and contractors of the Administration 
                        that regularly engage with covered institutions 
                        or borrowers in the program.
                    ``(L) Community advantage outreach and education.--
                The Administrator--
                            ``(i) shall develop and implement a program 
                        to promote to, conduct outreach to, and educate 
                        prospective covered institutions about the 
                        program, with a focus on women- and minority-
                        owned covered institutions; and
                            ``(ii) may enter into a contract with 1 or 
                        more nonprofit organizations experienced in 
                        working with and training mission driven 
                        lenders to provide the outreach and education 
                        described in clause (i).
                    ``(M) Community advantage network partner 
                participation.--
                            ``(i) In general.--A covered institution 
                        that uses a Community Advantage Network Partner 
                        shall abide by policies and procedures of the 
                        Administration concerning the use of Referral 
                        Agent fees permitted by the Administration and 
                        disclosure of those fees.
                            ``(ii) Payment of fees.--Notwithstanding 
                        any other provision of law, all fees described 
                        in clause (i) shall be paid by the covered 
                        institution to the Community Advantage Network 
                        Partner upon disbursement of the applicable 
                        program loan.
                    ``(N) Delegated authority.--A covered institution 
                is not eligible to receive delegated authority from the 
                Administration under the program until the covered 
                institution has approved and fully disbursed not less 
                than 10 loans under the program and the Administration 
                had evaluated the ability of the covered institution to 
                fulfill program requirements.
                    ``(O) Reporting.--
                            ``(i) Weekly reports.--
                                    ``(I) In general.--The 
                                Administration shall report on the 
                                website of the Administration, as part 
                                of the weekly reports on lending 
                                approvals under this subsection--
                                            ``(aa) on and after the 
                                        date of enactment of this 
                                        paragraph, the number and 
                                        dollar amount of loans 
                                        guaranteed under the Community 
                                        Advantage Pilot Program of the 
                                        Administration; and
                                            ``(bb) on and after the 
                                        date on which the 
                                        Administration begins to 
                                        approve loans under the 
                                        program, the number and dollar 
                                        amount of loans guaranteed 
                                        under the program.
                                    ``(II) Separate accounting.--The 
                                number and dollar amount of loans 
                                reported in a weekly report under 
                                subclause (I) for loans guaranteed 
                                under the Community Advantage Pilot 
                                Program of the Administration and under 
                                the program shall include a breakdown 
                                by the categories of race, ethnicity, 
                                and gender of the owners of the small 
                                business concerns, by whether the small 
                                business concern is a new or existing 
                                small business concern, and by whether 
                                the small business concern is located 
                                in an urban or rural area, and broken 
                                down by--
                                            ``(aa) loans of not more 
                                        than $50,000;
                                            ``(bb) loans of more than 
                                        $50,000 and not more than 
                                        $150,000;
                                            ``(cc) loans of more than 
                                        $150,000 and not more than 
                                        $250,000; and
                                            ``(dd) loans of more than 
                                        $250,000 and not more than 
                                        $350,000.
                            ``(ii) Annual reports.--
                                    ``(I) In general.--For each fiscal 
                                year in which the program is in effect, 
                                the Administration shall submit to the 
                                Committee on Small Business and 
                                Entrepreneurship of the Senate and the 
                                Committee on Small Business of the 
                                House of Representatives, and make 
                                publicly available on the internet, 
                                information about loans provided under 
                                the program and under the Community 
                                Advantage Pilot Program of the 
                                Administration.
                                    ``(II) Contents.--Each report 
                                submitted and made publicly available 
                                under subclause (I) shall include--
                                            ``(aa) the number and 
                                        dollar amounts of loans 
                                        provided to small business 
                                        concerns under the program, 
                                        including a breakdown by--

                                                    ``(AA) the gender 
                                                of the owners of the 
                                                small business concern;

                                                    ``(BB) the race and 
                                                ethnicity of the owners 
                                                of the small business 
                                                concern, disaggregated 
                                                in a manner that 
                                                captures all the racial 
                                                groups specified in the 
                                                American Community 
                                                Survey conducted by the 
                                                Bureau of the Census;

                                                    ``(CC) whether the 
                                                small business concern 
                                                is located in an urban 
                                                or rural area; and

                                                    ``(DD) whether the 
                                                small business concern 
                                                is an existing business 
                                                or a new business, as 
                                                provided in the weekly 
                                                reports on lending 
                                                approvals under this 
                                                subsection;

                                            ``(bb) the proportion of 
                                        loans described in item (aa) 
                                        compared to--

                                                    ``(AA) other 7(a) 
                                                loans of any amount;

                                                    ``(BB) other 7(a) 
                                                loans of similar 
                                                amounts;

                                                    ``(CC) express 
                                                loans provided under 
                                                paragraph (31) of 
                                                similar amounts; and

                                                    ``(DD) other 7(a) 
                                                loans of similar 
                                                amounts provided to 
                                                small business concerns 
                                                in underserved markets;

                                            ``(cc) a comparison of the 
                                        number and dollar amounts of 
                                        loans provided to small 
                                        business concerns under the 
                                        program and under each category 
                                        of loans described in item 
                                        (aa), broken down by--

                                                    ``(AA) loans of not 
                                                more than $50,000;

                                                    ``(BB) loans of 
                                                more than $50,000 and 
                                                not more than $150,000;

                                                    ``(CC) loans of 
                                                more than $150,000 and 
                                                not more than $250,000; 
                                                and

                                                    ``(DD) loans of 
                                                more than $250,000 and 
                                                not more than $350,000;

                                            ``(dd) the number and 
                                        dollar amounts of loans 
                                        provided to small business 
                                        concerns under the program by 
                                        State, and the jobs created or 
                                        retained within each State;
                                            ``(ee) a list of covered 
                                        institutions participating in 
                                        the program and the Community 
                                        Advantage Pilot Program of the 
                                        Administration, including--

                                                    ``(AA) the name, 
                                                location, and contact 
                                                information, such as 
                                                the website and 
                                                telephone number, of 
                                                each covered 
                                                institution; and

                                                    ``(BB) a breakdown 
                                                by the number and 
                                                dollar amount of the 
                                                loans approved for 
                                                small business 
                                                concerns; and

                                            ``(ff) the benchmarks 
                                        established by the Community 
                                        Advantage Working Group under 
                                        subparagraph (O)(i).
                                    ``(III) Timing.--An annual report 
                                required under this clause shall--
                                            ``(aa) be submitted and 
                                        made publicly available not 
                                        later than December 1 of each 
                                        year; and
                                            ``(bb) cover the lending 
                                        activity for the fiscal year 
                                        that ended on September 30 of 
                                        that same year.
                    ``(P) GAO report.--Not later than 5 years after the 
                date of enactment of this paragraph, the Comptroller 
                General of the United States shall submit to the 
                Administrator, the Committee on Small Business and 
                Entrepreneurship of the Senate, and the Committee on 
                Small Business of the House of Representatives a 
                report--
                            ``(i) assessing--
                                    ``(I) the extent to which the 
                                program fulfills the requirements of 
                                this paragraph; and
                                    ``(II) the performance of covered 
                                institutions participating in the 
                                program; and
                            ``(ii) providing recommendations on the 
                        administration of the program and the findings 
                        under subclauses (I) and (II) of clause (i).
                    ``(Q) Community advantage working group.--
                            ``(i) In general.--Not later than 90 days 
                        after the date of enactment of this paragraph, 
                        the Administrator shall establish a Community 
                        Advantage Working Group, which shall--
                                    ``(I) include--
                                            ``(aa) a geographically 
                                        diverse representation of 
                                        members from among covered 
                                        institutions participating in 
                                        the program; and
                                            ``(bb) representatives from 
                                        the Office of Capital Access of 
                                        the Administration, including 
                                        the Office of Credit Risk 
                                        Management, the Office of 
                                        Financial Assistance, and the 
                                        Office of Economic Opportunity;
                                    ``(II) develop recommendations on 
                                how the Administration can effectively 
                                manage, support, and promote the 
                                program and the mission of the program;
                                    ``(III) establish metrics of 
                                success and benchmarks that reflect the 
                                mission and population served by 
                                covered institutions under the program, 
                                which the Administration shall use to 
                                evaluate the performance of those 
                                covered institutions;
                                    ``(IV) establish criteria assessing 
                                the business support services and 
                                technical assistance needs of borrowers 
                                and methods to assess lender expertise 
                                to provide necessary services and 
                                assistance; and
                                    ``(V) institute regular and 
                                sustainable systems of communication 
                                between the Administration and covered 
                                institutions participating in the 
                                program.
                            ``(ii) Report.--Not later than 1 year after 
                        the date of enactment of this paragraph, the 
                        Administrator shall submit to the Committee on 
                        Small Business and Entrepreneurship of the 
                        Senate and the Committee on Small Business of 
                        the House of Representatives a report that 
                        includes--
                                    ``(I) the recommendations of the 
                                Community Advantage Working Group 
                                established under clause (i); and
                                    ``(II) a recommended plan and 
                                timeline for implementation of those 
                                recommendations.
                    ``(R) Regulations.--
                            ``(i) In general.--Not later than 180 days 
                        after the date of enactment of this paragraph, 
                        the Administrator shall promulgate regulations 
                        governing the program, including metrics for 
                        lender performance, metrics of success and 
                        benchmarks of the program, and criteria for 
                        appropriate management and technical 
                        assistance.
                            ``(ii) Updates.--The Administrator shall 
                        consult the report issued under subparagraph 
                        (P)(ii) and, not later than 180 days after 
                        submission of the report, promulgate any 
                        necessary changes to existing regulations of 
                        the Administration based on the recommendations 
                        contained in the report.
                    ``(S) Authorization of appropriations.--There is 
                authorized to be appropriated such sums as may be 
                necessary to conduct outreach and education described 
                in subparagraph (L).''.
    (b) Participation.--Section 7(a)(2) of the Small Business Act (15 
U.S.C. 636(a)(2)) is amended--
            (1) in subparagraph (A), in the matter preceding clause 
        (i), by striking ``and (F)'' and inserting ``(F), and (G)''; 
        and
            (2) by adding at the end the following:
                    ``(G) Participation in the community advantage loan 
                program.--In an agreement to participate in a loan on a 
                deferred basis under paragraph (38), the participation 
                by the Administration shall be--
                            ``(i) 80 percent of the balance of the 
                        financing outstanding at the time of the 
                        disbursement of the loan, if that balance is 
                        more than $150,000 and not more than $350,000; 
                        or
                            ``(ii) 90 percent of the balance of the 
                        financing outstanding at the time of the 
                        disbursement of the loan, if that balance is 
                        not more than $150,000.''.
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