I 

118TH CONGRESS 

2D SESSION H. R. 10247 

To amend the Small Business Act to enhance the Office of Credit Risk 

Management, to require the Administrator of the Small Business Administration to issue rules relating to environmental obligations of certified 

development companies, and for other purposes. 

IN THE HOUSE OF REPRESENTATIVES 

NOVEMBER 21, 2024 

Ms. VELA ́ZQUEZ introduced the following bill; which was referred to the 

Committee on Small Business 

A BILL 

To amend the Small Business Act to enhance the Office 

of Credit Risk Management, to require the Administrator 

of the Small Business Administration to issue rules relating to environmental obligations of certified development 

companies, and for other purposes. 

1 Be it enacted by the Senate and House of Representa2 tives of the United States of America in Congress assembled, 

3 SECTION 1. SHORT TITLE. 

4 This Act may be cited as the ‘‘504 Credit Risk Man5 agement Improvement Act of 2024’’. 


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1 SEC. 2. ENHANCEMENTS TO THE OFFICE OF CREDIT RISK 

2 MANAGEMENT. 

3 Title V of the Small Business Investment Act of 1958 

4 (15 U.S.C. 695 et seq.) is amended by adding at the end 

5 the following: 

6 ‘‘SEC. 511. OFFICE OF CREDIT RISK MANAGEMENT OVER7 SIGHT. 

8 ‘‘(a) DEFINITIONS.—In this section— 

9 ‘‘(1) the term ‘Director’ means the Director of 

10 the Office; and 

11 ‘‘(2) the term ‘Office’ means the Office of Cred12 it Risk Management established under section 47 of 

13 the Small Business Act (15 U.S.C. 657t). 

14 ‘‘(b) DUTIES RELATING TO 504 PROGRAM.—The Of15 fice— 

16 ‘‘(1) shall be responsible for— 

17 ‘‘(A) supervising any certified development 

18 company, as provided in subsection (d); and 

19 ‘‘(B) conducting file reviews with respect 

20 to loan closings under the program established 

21 under this title, as provided in subsection (c); 

22 and 

23 ‘‘(2) may— 

24 ‘‘(A) take formal and informal enforcement 

25 actions against a certified development com26 pany, as provided in subsection (e); and 


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1 ‘‘(B) charge a certified development com2 pany a fee, as provided in subsection (f). 

3 ‘‘(c) LOAN CLOSING FILE REVIEWS.—With respect 

4 to a loan closing under the program established under this 

5 title, the Office shall be responsible for the following: 

6 ‘‘(1) Conducting a complete file review of a ran7 dom selection of all loan closings, the number, fre8 quency, and conduct of which shall be at the discre9 tion of the Office, to ensure program integrity, in10 cluding a review of the items listed on the Checklist 

11 for Complete File Review, or any successor thereof, 

12 contained in the appropriate form of the Administra13 tion. 

14 ‘‘(2) Not later than 60 days after the date on 

15 which each complete file review conducted under 

16 paragraph (1) is completed, preparing a written re17 port documenting the results of that review, which 

18 the Office shall send to— 

19 ‘‘(A) the applicable certified development 

20 company; 

21 ‘‘(B) the designated attorney that closed 

22 the loan for the certified development company; 

23 and 

24 ‘‘(C) the Commercial Loan Service Center. 


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1 ‘‘(3) If a complete file review conducted under 

2 paragraph (1) reveals a deficiency that could result 

3 in a loss to the Administration, requiring the appli4 cable certified development company or the des5 ignated attorney to promptly correct the deficiency. 

6 ‘‘(d) SUPERVISION OF CERTIFIED DEVELOPMENT

7 COMPANIES.—With respect to the supervision of certified 

8 development companies— 

9 ‘‘(1) an employee of the Office shall— 

10 ‘‘(A) be present for, and supervise, the re11 view of any such company that is conducted by 

12 a contractor of the Office on the premises of 

13 the company; and 

14 ‘‘(B) supervise the review of any such com15 pany that is conducted by a contractor of the 

16 Office that is not conducted on the premises of 

17 the company; and 

18 ‘‘(2) the Administrator shall— 

19 ‘‘(A) develop a timeline for the review by 

20 the Office of certified development companies 

21 and the submission of reports regarding those 

22 reviews, under which the Administrator shall— 

23 ‘‘(i) submit to a certified development 

24 company a written report of any review of 

25 the company not later than 90 days after 


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1 the date on which the review is concluded; 

2 or 

3 ‘‘(ii) if the Administrator expects to 

4 submit the report after the end of the 90- 

5 day period described in clause (i)— 

6 ‘‘(I) notify the company of the 

7 expected date of submission of the re8 port and the reason for the delay; and 

9 ‘‘(II) submit to the company the 

10 report; and 

11 ‘‘(B) if a response by a certified develop12 ment company is requested in a report sub13 mitted under subparagraph (A), require the 

14 company to submit responses to the Adminis15 trator not later than 45 business days after the 

16 date on which the company receives the report. 

17 ‘‘(e) ENFORCEMENT AUTHORITY AGAINST CER18 TIFIED DEVELOPMENT COMPANIES.— 

19 ‘‘(1) INFORMAL ENFORCEMENT AUTHORITY.— 

20 The Director may take an informal enforcement ac21 tion against a certified development company if the 

22 Director finds that the company has violated a stat23 utory or regulatory requirement or any requirement 

24 in a Standard Operating Procedures Manual or PolVerDate Sep 11 2014 01:11 Dec 28, 2024 Jkt 059200 PO 00000 Frm 00005 Fmt 6652 Sfmt 6201 E:\BILLS\H10247.IH H10247

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1 icy Notice relating to a program or function of the 

2 Office of Capital Access. 

3 ‘‘(2) FORMAL ENFORCEMENT AUTHORITY.— 

4 ‘‘(A) IN GENERAL.—With the approval of 

5 the Lender Oversight Committee established 

6 under section 48 of the Small Business Act (15 

7 U.S.C. 657u), the Director may take a formal 

8 enforcement action against any certified devel9 opment company if the Director finds that the 

10 company has violated— 

11 ‘‘(i) a statutory or regulatory require12 ment; or 

13 ‘‘(ii) any requirement described in a 

14 Standard Operating Procedures Manual or 

15 Policy Notice relating to a program or 

16 function of the Office of Capital Access. 

17 ‘‘(B) ENFORCEMENT ACTIONS.—The deci18 sion to take an enforcement action against a 

19 certified development company under subpara20 graph (A) shall be based on the severity or fre21 quency of the violation and may include assess22 ing a civil monetary penalty against the com23 pany in an amount that is not greater than 

24 $250,000. 


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1 ‘‘(3) FAILURE TO SUBMIT ANNUAL REPORT.— 

2 With respect to a certified development company 

3 that, as of the date that is 60 days after the date 

4 on which the company is required to submit any re5 port, fails to submit that report, the Director may— 

6 ‘‘(A) suspend the company from partici7 pating in the program established under this 

8 title for a period that is not longer than 30 

9 days; or 

10 ‘‘(B) impose a penalty on the company in 

11 an amount to be determined by the Director, 

12 except that the amount of the penalty shall be 

13 not more than $10,000. 

14 ‘‘(f) FEE AUTHORITY REGARDING CERTIFIED DE15 VELOPMENT COMPANIES.— 

16 ‘‘(1) IN GENERAL.—On and after the date that 

17 is 1 year after the date of enactment of this section, 

18 the Office may collect from each certified develop19 ment company a fee, the amount of which— 

20 ‘‘(A) shall be determined on a graduated 

21 scale according to the size of the portfolio of 

22 the certified development company with respect 

23 to the program carried out under this title; and 


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1 ‘‘(B) shall not exceed the amount that is 1 

2 basis point with respect to the value of the 

3 portfolio described in subparagraph (A). 

4 ‘‘(2) PAYMENT.—A certified development com5 pany on which a fee is imposed under paragraph (1) 

6 shall pay the fee from the servicing fees collected by 

7 the development company pursuant to regulation. 

8 ‘‘(3) REPORT.—Not later than 2 years after the 

9 date of enactment of this section, and annually 

10 thereafter, the Administrator of the Small Business 

11 Administration shall submit to the Committee on 

12 Small Business of the House of Representatives and 

13 the Committee on Small Business and Entrepre14 neurship of the Senate and make available online a 

15 report that shall include— 

16 ‘‘(A) the fees, if any, charged by the Office 

17 under this subsection; 

18 ‘‘(B) a breakdown of those fees by certified 

19 development company portfolio size; 

20 ‘‘(C) the number of full-time equivalent 

21 and contract employees carrying out duties re22 lated to certified development companies; and 

23 ‘‘(D) an accounting of the use of fees by 

24 the Office and its employees or contractors for 

25 certified development company examinations.’’. 


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1 SEC. 3. RULES RELATING TO OBLIGATIONS OF CERTIFIED 

2 DEVELOPMENT COMPANIES UNDER THE NA3 TIONAL ENVIRONMENTAL POLICY ACT. 

4 (a) ELIGIBLE CERTIFIED DEVELOPMENT COMPANY

5 DEFINED.—In this section, the term ‘‘eligible certified de6 velopment company’’ means a certified development com7 pany, within the meaning under title V of the Small Busi8 ness Investment Act of 1958 (15 U.S.C. 695 et seq.), that 

9 receives assistance pursuant to that title. 

10 (b) REQUIREMENT TO ISSUE RULES.—Not later 

11 than 180 days after the date of enactment of this Act, 

12 the Administrator of the Small Business Administration 

13 shall issue rules to clarify the procedures necessary for an 

14 eligible certified development company to comply with the 

15 applicable requirements under National Environmental 

16 Policy Act of 1969 (42 U.S.C. 4321 et seq.). 

17 (c) RULE OF CONSTRUCTION.—Nothing in this sec18 tion shall be construed to modify the requirements of the 

19 National Environmental Policy Act of 1969 (42 U.S.C. 

20 4321 et seq.). 

21 SEC. 4. EXTENSION OF SUNSET FOR DELEGATED AUTHOR22 ITY FOR ACCREDITED LENDERS. 

23 Section 328(b)(2) of division N of the Consolidated 

24 Appropriations Act, 2021 (15 U.S.C. 697d note) is 

25 amended by striking ‘‘2023’’ and inserting ‘‘2025’’. 

Æ 


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