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[Congressional Bills 109th Congress]
[From the U.S. Government Publishing Office]
[S. 2646 Introduced in Senate (IS)]

109th CONGRESS
  2d Session
                                S. 2646

To create a 3-year pilot program that makes small, nonprofit child care 
   businesses eligible for loans under title V of the Small Business 
                        Investment Act of 1958.

_______________________________________________________________________

                   IN THE SENATE OF THE UNITED STATES

                             April 25, 2006

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

_______________________________________________________________________

                                 A BILL

 
To create a 3-year pilot program that makes small, nonprofit child care 
   businesses eligible for loans under title V of the Small Business 
                        Investment Act of 1958.

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

SECTION 1. SHORT TITLE; DEFINITIONS.

    (a) Short Title.--This Act may be cited as the ``Child Care Lending 
Pilot Act of 2006''.
    (b) Definitions.--In this Act--
            (1) the terms ``Administration'' and ``Administrator'' mean 
        the Small Business Administration and the Administrator 
        thereof, respectively; and
            (2) the term ``small business concern'' has the meaning 
        given the term in section 3 of the Small Business Act (15 
        U.S.C. 632).

SEC. 2. CHILD CARE LENDING PILOT PROGRAM.

    Section 502 of the Small Business Investment Act of 1958 (15 U.S.C. 
696) is amended--
            (1) in the matter preceding paragraph (1)--
                    (A) by striking ``The Administration'' and 
                inserting the following:
    ``(a) Authorization.--The Administration'';
                    (B) by striking ``and such loans'' and inserting 
                ``. Such loans'';
                    (C) by striking ``: Provided, however, That the 
                foregoing powers shall be subject to the following 
                restrictions and limitations:'' and inserting a period; 
                and
                    (D) by adding at the end the following:
    ``(b) Restrictions and Limitations.--The authority under subsection 
(a) shall be subject to the following restrictions and limitations:''; 
and
            (2) in paragraph (1)--
                    (A) by inserting after ``Use of proceeds.--'' the 
                following:
                    ``(A) In general.--;'' and
                    (B) by adding at the end the following:
                    ``(B) Loans to small, nonprofit child care 
                businesses.--
                            ``(i) In general.--Notwithstanding 
                        subsection (a)(1), the proceeds of any loan 
                        described in subsection (a) may be used by the 
                        certified development company to assist a 
                        small, nonprofit child care business, if--
                                    ``(I) the loan is used for a sound 
                                business purpose that has been approved 
                                by the Administration;
                                    ``(II) each such business meets all 
                                of the same eligibility requirements 
                                applicable to for-profit businesses 
                                under this title, except for status as 
                                a for-profit business;
                                    ``(III) 1 or more individuals has 
                                personally guaranteed the loan;
                                    ``(IV) each such business has clear 
                                and singular title to the collateral 
                                for the loan; and
                                    ``(V) each such business has 
                                sufficient cash flow from its 
                                operations to meet its obligations on 
                                the loan and its normal and reasonable 
                                operating expenses.
                            ``(ii) Limitation on volume.--Not more than 
                        7 percent of the total number of loans 
                        guaranteed in any fiscal year under this title 
                        may be awarded under this subparagraph.
                            ``(iii) Defined term.--For purposes of this 
                        subparagraph, the term `small, nonprofit child 
                        care business' means an establishment that--
                                    ``(I) is organized in accordance 
                                with section 501(c)(3) of the Internal 
                                Revenue Code of 1986;
                                    ``(II) is primarily engaged in 
                                providing child care for infants, 
                                toddlers, pre-school, or pre-
                                kindergarten children (or any 
                                combination thereof), and may provide 
                                care for older children when they are 
                                not in school, and may offer pre-
                                kindergarten educational programs;
                                    ``(III) including its affiliates, 
                                has tangible net worth that does not 
                                exceed $7,000,000, and has average net 
                                income (excluding any carryover losses) 
                                for the 2 completed fiscal years 
                                preceding the application that does not 
                                exceed $2,500,000; and
                                    ``(IV) is licensed as a child care 
                                provider by the State, the insular 
                                area, or the District of Columbia in 
                                which it is located.
                            ``(iv) Sunset provision.--This subparagraph 
                        shall remain in effect until September 30, 
                        2009, and shall apply to all loans authorized 
                        under this subparagraph that are applied for, 
                        approved, or disbursed during the period 
                        beginning on the date of enactment of this 
                        subparagraph and ending on September 30, 
                        2009.''.

SEC. 3. REPORTS.

    (a) Small Business Administration.--
            (1) In general.--Not later than 6 months after the date of 
        enactment of this Act, and every 6 months thereafter until 
        September 30, 2009, the Administrator shall submit a report on 
        the implementation of the program under section 502(b)(1)(B) of 
        the Small Business Investment Act of 1958, as added by this 
        Act, to--
                    (A) the Committee on Small Business and 
                Entrepreneurship of the Senate; and
                    (B) the Committee on Small Business of the House of 
                Representatives.
            (2) Contents.--Each report under paragraph (1) shall 
        contain--
                    (A) the date on which the program is implemented;
                    (B) the date on which the rules are issued under 
                section 4; and
                    (C) the number and dollar amount of loans under the 
                program applied for, approved, and disbursed during the 
                previous 6 months--
                            (i) with respect to nonprofit child care 
                        businesses; and
                            (ii) with respect to for-profit child care 
                        businesses.
    (b) Government Accountability Office.--
            (1) In general.--Not later than March 31, 2009, the 
        Comptroller General of the United States shall submit a report 
        on the child care small business loans authorized by section 
        502(b)(1)(B) of the Small Business Investment Act of 1958, as 
        added by this Act, to--
                    (A) the Committee on Small Business and 
                Entrepreneurship of the Senate; and
                    (B) the Committee on Small Business of the House of 
                Representatives.
            (2) Contents.--The report under paragraph (1) shall contain 
        information gathered during the first 2 years of the loan 
        program, including--
                    (A) an evaluation of the timeliness of the 
                implementation of the loan program;
                    (B) a description of the effectiveness and ease 
                with which certified development companies, lenders, 
                and small business concerns have participated in the 
                loan program;
                    (C) a description and assessment of how the loan 
                program was marketed;
                    (D) by location (State, insular area, and the 
                District of Columbia) and in total, the number of child 
                care small businesses, categorized by status as a for-
                profit or nonprofit business, that--
                            (i) applied for a loan under the program 
                        (and whether it was a new or expanding child 
                        care provider);
                            (ii) were approved for a loan under the 
                        program; and
                            (iii) received a loan disbursement under 
                        the program (and whether they are a new or 
                        expanding child care provider); and
                    (E) with respect to businesses described under 
                subparagraph (D)(iii)--
                            (i) the number of such businesses in each 
                        State, insular area, and the District of 
                        Columbia, as of the year of enactment of this 
                        Act;
                            (ii) the total amount loaned to such 
                        businesses under the program;
                            (iii) the total number of loans to such 
                        businesses under the program;
                            (iv) the average loan amount and term;
                            (v) the currency rate, delinquencies, 
                        defaults, and losses of the loans;
                            (vi) the number and percent of children 
                        served who receive subsidized assistance; and
                            (vii) the number and percent of children 
                        served who are low income.
            (3) Access to information.--
                    (A) In general.--The Administration shall collect 
                and maintain such information as may be necessary to 
                carry out this subsection from certified development 
                centers and child care providers, and such centers and 
                providers shall comply with a request for information 
                from the Administration for that purpose.
                    (B) Provision of information to government 
                accountability office.--The Administration shall 
                provide information collected under this paragraph to 
                the Comptroller General of the United States for 
                purposes of the report required by this subsection.

SEC. 4. RULEMAKING AUTHORITY.

    Not later than 120 days after the date of enactment of this Act, 
the Administrator shall issue final rules to carry out the loan program 
authorized by section 502(b)(1)(B) of the Small Business Investment Act 
of 1958, as added by this Act.
                                 <all>
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