II 

109TH CONGRESS 

1ST SESSION S. 1463 

To clarify that the Small Business Administration has authority to provide 

emergency assistance to non-farm-related small business concerns that 

have suffered substantial economic harm from drought. 

IN THE SENATE OF THE UNITED STATES 

JULY 21, 2005 

Mr. KERRY introduced the following bill; which was read twice and referred 

to the Committee on Small Business and Entrepreneurship 

A BILL 

To clarify that the Small Business Administration has authority to provide emergency assistance to non-farm-related small business concerns that have suffered substantial economic harm from drought. 

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 ‘‘Small Business 

5 Drought Relief Act of 2005’’. 

6 SEC. 2. FINDINGS. 

7 Congress finds that— 
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1 (1) as of July 2002, when this Act was origi2 nally introduced in the 107th Congress as Senate 

3 Bill S. 2734, more than 36 States (including Massa4 chusetts, Montana, Texas, and Nevada) had suffered 

5 from continuing drought conditions; 

6 (2) as of July 2005, drought continues to be a 

7 serious national problem, with 19 States suffering 

8 from severe to extreme drought conditions; 

9 (3) droughts have a negative effect on State 

10 and regional economies; 

11 (4) many small businesses in the United States 

12 sell, distribute, market, or otherwise engage in com13 merce related to water and water sources, such as 

14 lakes, rivers, and streams; 

15 (5) many small businesses in the United States 

16 suffer economic injury from drought conditions, 

17 leading to revenue losses, job layoffs, and bank18 ruptcies; 

19 (6) these small businesses need access to low20 interest loans for business-related purposes, includ21 ing paying their bills and making payroll until busi22 ness returns to normal; 

23 (7) absent a legislative change, the practice of 

24 the Small Business Administration of permitting 

25 only agriculture and agriculture-related businesses to 
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1 be eligible for Federal disaster loan assistance as a 

2 result of drought conditions would likely continue; 

3 (8) during the past several years small busi4 nesses that rely on the Great Lakes have suffered 

5 economic injury as a result of lower than average 

6 water levels, resulting from low precipitation and in7 creased evaporation, and there are concerns that 

8 small businesses in other regions could suffer similar 

9 hardships beyond their control and that they should 

10 also be eligible for assistance; and 

11 (9) it is necessary to amend the Small Business 

12 Act to clarify that non-farm-related small businesses 

13 that have suffered economic injury from drought are 

14 eligible to receive financial assistance through Small 

15 Business Administration Economic Injury Disaster 

16 Loans. 

17 SEC. 3. DISASTER RELIEF FOR SMALL BUSINESS CON18 CERNS DAMAGED BY DROUGHT. 

19 (a) DROUGHT DISASTER AUTHORITY.— 

20 (1) DEFINITION OF DISASTER.—Section 3(k) of 

21 the Small Business Act (15 U.S.C. 632(k)) is 

22 amended— 

23 (A) by inserting ‘‘(1)’’ after ‘‘(k)’’; and 

24 (B) by adding at the end the following: 
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1 ‘‘(2) For purposes of section 7(b)(2), the term ‘dis2 aster’ includes— 

3 ‘‘(A) drought; and 

4 ‘‘(B) below average water levels in the Great 

5 Lakes, or on any body of water in the United States 

6 that supports commerce by small business con7 cerns.’’. 

8 (2) DROUGHT DISASTER RELIEF AUTHORITY.— 

9 Section 7(b)(2) of the Small Business Act (15 

10 U.S.C. 636(b)(2)) is amended— 

11 (A) by inserting ‘‘(including drought), with 

12 respect to both farm-related and non-farm-re13 lated small business concerns,’’ before ‘‘if the 

14 Administration’’; and 

15 (B) in subparagraph (B), by striking ‘‘the 

16 Consolidated Farmers Home Administration 

17 Act of 1961 (7 U.S.C. 1961)’’ and inserting the 

18 following: ‘‘section 321 of the Consolidated 

19 Farm and Rural Development Act (7 U.S.C. 

20 1961), in which case, assistance under this 

21 paragraph may be provided to farm-related and 

22 non-farm-related small business concerns, sub23 ject to the other applicable requirements of this 

24 paragraph’’. 
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1 (b) LIMITATION ON LOANS.—From funds otherwise 

2 appropriated for loans under section 7(b) of the Small 

3 Business Act (15 U.S.C. 636(b)), not more than 

4 $9,000,000 may be used during each of fiscal years 2005 

5 through 2008, to provide drought disaster loans to non6 farm-related small business concerns in accordance with 

7 this Act and the amendments made by this Act. 

8 (c) PROMPT RESPONSE TO DISASTER REQUESTS.— 

9 Section 7(b)(2)(D) of the Small Business Act (15 U.S.C. 

10 636(b)(2)(D)) is amended by striking ‘‘Upon receipt of 

11 such certification, the Administration may’’ and inserting 

12 ‘‘Not later than 30 days after the date of receipt of such 

13 certification by a Governor of a State, the Administration 

14 shall respond in writing to that Governor on its determina15 tion and the reasons therefore, and may’’. 

16 SEC. 4. RULEMAKING. 

17 Not later than 45 days after the date of enactment 

18 of this Act, the Administrator of the Small Business Ad19 ministration shall promulgate final rules to carry out this 

20 Act and the amendments made by this Act. 

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