II 

109TH CONGRESS 

1ST SESSION S. 1807 

To provide assistance for small businesses damaged by Hurricane Katrina 

or Hurricane Rita, and for other purposes. 

IN THE SENATE OF THE UNITED STATES 

SEPTEMBER 30, 2005 

Ms. SNOWE (for herself, Mr. KERRY, Mr. VITTER, Ms. LANDRIEU, Mr. TALENT, Mr. KENNEDY, Mr. CORNYN, and Mr. BAYH) introduced the following bill; which was read twice and referred to the Committee on Small 

Business and Entrepreneurship 

A BILL 

To provide assistance for small businesses damaged by Hurricane Katrina or Hurricane Rita, 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; TABLE OF CONTENTS. 

4 (a) SHORT TITLE.—This Act may be cited as the 

5 ‘‘Small Business Hurricane Relief and Reconstruction Act 

6 of 2005’’. 

7 (b) TABLE OF CONTENTS.—The table of contents for 

8 this Act is as follows: 

Sec. 1. Short title; table of contents. 
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Sec. 2. Definitions. 

Sec. 3. Disaster loans after Hurricane Katrina and Hurricane Rita. 

Sec. 4. Energy emergency relief. 

Sec. 5. Supplemental emergency loans. 

Sec. 6. Development company debentures. 

Sec. 7. Small business emergency relief. 

Sec. 8. Business counseling. 

Sec. 9. Small business development centers. 

Sec. 10. HUBZones. 

Sec. 11. Outreach programs. 

Sec. 12. Small business bonding threshold. 

Sec. 13. Small business participation. 

Sec. 14. Micropurchases. 

Sec. 15. Loan defaults. 

Sec. 16. Budgetary treatment of loans and financings. 

Sec. 17. Emergency procurement authority. 

1 SEC. 2. DEFINITIONS. 

2 In this Act— 

3 (1) the terms ‘‘Administration’’ and ‘‘Adminis4 trator’’ mean the Small Business Administration 

5 and the Administrator thereof, respectively; 

6 (2) the term ‘‘Disaster Area’’ means an area 

7 which the President has designated as a disaster 

8 area as a result of Hurricane Katrina of August 

9 2005 or Hurricane Rita of September 2005; and 

10 (3) the term ‘‘small business concern’’ has the 

11 same meaning as in section 3 of the Small Business 

12 Act. 

13 SEC. 3. DISASTER LOANS AFTER HURRICANE KATRINA AND 

14 HURRICANE RITA. 

15 (a) IN A DISASTER AREA.—Section 7(b) of the Small 

16 Business Act (15 U.S.C. 636(b)) is amended by inserting 

17 immediately after paragraph (3) the following: 
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1 ‘‘(4) DISASTER LOANS AFTER HURRICANE

2 KATRINA AND HURRICANE RITA IN A DISASTER

3 AREA.— 

4 ‘‘(A) DEFINITION.—In this paragraph, the 

5 term ‘Disaster Area’ means an area which the 

6 President has designated as a disaster area as 

7 a result of Hurricane Katrina of August 2005 

8 or Hurricane Rita of September 2005. 

9 ‘‘(B) LOANS TO NONPROFITS.—In addition 

10 to any other loan authorized by this subsection, 

11 the Administrator may make such loans under 

12 this subsection (either directly or in cooperation 

13 with banks or other lending institutions through 

14 agreements to participate on an immediate or 

15 deferred basis) as the Administrator determines 

16 appropriate to a nonprofit organization located 

17 or operating in a Disaster Area or providing 

18 services to persons who have evacuated from a 

19 Disaster Area. 

20 ‘‘(C) INCREASED LOAN CAPS.— 

21 ‘‘(i) AGGREGATE LOAN AMOUNTS.— 

22 Except as provided in clause (ii), the ag23 gregate loan amount outstanding and com24 mitted to a borrower under this subsection, 

25 except for loans under paragraph (5) or 
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1 (6), made as a result of Hurricane Katrina 

2 or Hurricane Rita, may not exceed 

3 $10,000,000. 

4 ‘‘(ii) WAIVER AUTHORITY.—The Ad5 ministrator may, at the discretion of the 

6 Administrator, waive the aggregate loan 

7 amount established under clause (i). 

8 ‘‘(D) DEFERMENT OF DISASTER LOAN

9 PAYMENTS.— 

10 ‘‘(i) IN GENERAL.—Notwithstanding 

11 any other provision of law, payments of 

12 principal and interest on a loan to a bor13 rower located in a Disaster Area made be14 fore August 24, 2007, shall be deferred, 

15 and no interest shall accrue with respect to 

16 such loan, during the time period described 

17 in clause (ii). 

18 ‘‘(ii) TIME PERIOD.—The time period 

19 for purposes of clause (i) shall be 1 year 

20 from the later of the date of enactment of 

21 this paragraph or the date of issuance of 

22 a loan described in clause (i), but may be 

23 extended to 2 years from such date, at the 

24 discretion of the Administrator. 
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1 ‘‘(iii) RESUMPTION OF PAYMENTS.— 

2 At the end of the time period described in 

3 clause (ii), the payment of periodic install4 ments of principal and interest shall be re5 quired with respect to such loan, in the 

6 same manner and subject to the same 

7 terms and conditions as would otherwise be 

8 applicable to any other loan made under 

9 this subsection. 

10 ‘‘(E) REFINANCING DISASTER LOANS

11 AFTER HURRICANE KATRINA AND HURRICANE

12 RITA.— 

13 ‘‘(i) IN GENERAL.—Any loan made 

14 under this subsection that was outstanding 

15 as to principal or interest on August 24, 

16 2005, may be refinanced by a small busi17 ness concern that is located in a Disaster 

18 Area, and the refinanced amount shall be 

19 considered to be part of the new loan for 

20 purposes of this subparagraph. 

21 ‘‘(ii) NO EFFECT ON ELIGIBILITY.—A 

22 refinancing under clause (i) by a small 

23 business concern shall be in addition to 

24 any other loan eligibility for that small 

25 business concern under this Act. 
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1 ‘‘(F) REFINANCING BUSINESS DEBT.— 

2 ‘‘(i) IN GENERAL.—Any business debt 

3 of a small business concern that was out4 standing as to principal or interest on Au5 gust 24, 2005, may be refinanced by the 

6 small business concern if it is, or was on 

7 that date, located in a Disaster Area. With 

8 respect to a refinancing under this clause, 

9 payments of principal shall be deferred, 

10 and interest may accrue, during the 1-year 

11 period following the date of refinancing, 

12 and the refinanced amount shall be consid13 ered to be part of a new loan for purposes 

14 of this subparagraph. 

15 ‘‘(ii) RESUMPTION OF PAYMENTS.—At 

16 the end of the 1-year period described in 

17 clause (i), the payment of periodic install18 ments of principal and interest shall be re19 quired with respect to such loan, in the 

20 same manner and subject to the same 

21 terms and conditions as would otherwise be 

22 applicable to any other loan made under 

23 this subsection. 

24 ‘‘(G) TERMS.—A loan under subparagraph 

25 (E) or (F) shall be made at the same interest 
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1 rate as economic injury loans under paragraph 

2 (2). 

3 ‘‘(H) EXTENDED APPLICATION PERIOD.— 

4 Notwithstanding any other provision of law, the 

5 Administrator shall accept applications for as6 sistance under this subsection as a result of 

7 Hurricane Katrina or Rita until 1 year after 

8 the date on which the President designated the 

9 area as a disaster area as a result of Hurricane 

10 Katrina or Hurricane Rita, as the case may be. 

11 ‘‘(I) NO SALE.—No loan under this sub12 section made as a result of Hurricane Katrina 

13 or Hurricane Rita may be sold.’’. 

14 (b) NATIONWIDE DISASTER LOANS.—Section 7(b) of 

15 the Small Business Act (15 U.S.C. 636(b)), as amended 

16 by this Act, is amended by inserting immediately after 

17 paragraph (4) the following: 

18 ‘‘(5) NATIONWIDE LOANS AFTER HURRICANE

19 KATRINA AND HURRICANE RITA.—In addition to any 

20 other loan authorized by this subsection, the Admin21 istrator may make such loans under this subsection 

22 (either directly or in cooperation with banks or other 

23 lending institutions through agreements to partici24 pate on an immediate or deferred basis) as the Ad25 ministrator determines appropriate to a small busi-
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1 ness concern, small agricultural cooperative, small 

2 nursery, or small producer cooperative located any3 where in the United States that demonstrates a di4 rect adverse economic impact caused by Hurricane 

5 Katrina or Hurricane Rita, based on such criteria as 

6 the Administrator may set by rule, regulation, or 

7 order.’’. 

8 (c) DISASTER MITIGATION.— 

9 (1) IN GENERAL.—Section 7(b)(1)(A) of the 

10 Small Business Act (15 U.S.C. 636(b)(1)(A)) is 

11 amended by inserting ‘‘of the aggregate costs of 

12 such damage or destruction (whether or not com13 pensated for by insurance or otherwise)’’ after ‘‘20 

14 per centum’’. 

15 (2) EFFECTIVE DATE.—The amendment made 

16 by paragraph (1) shall apply with respect to a loan 

17 or guarantee made after the date of enactment of 

18 this Act. 

19 (d) TECHNICAL AMENDMENTS.—Section 7(b) of the 

20 Small Business Act (15 U.S.C. 636(b)) is amended— 

21 (1) in the matter preceding paragraph (1), by 

22 striking ‘‘the, Administration’’ and inserting ‘‘the 

23 Administration’’; 

24 (2) in paragraph (2)(A), by striking ‘‘Disaster 

25 Relief and Emergency Assistance Act’’ and inserting 
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1 ‘‘Robert T. Stafford Disaster Relief and Emergency 

2 Assistance Act (42 U.S.C. 5121 et seq.)’’; and 

3 (3) in the undesignated matter at the end— 

4 (A) by striking ‘‘, (2), and (4)’’ and insert5 ing ‘‘and (2)’’; and 

6 (B) by striking ‘‘, (2), or (4)’’ and insert7 ing ‘‘(2)’’. 

8 (e) DISASTER LOAN ADDITIONAL AMOUNTS.—In ad9 dition to any other amounts otherwise appropriated for 

10 such purpose, there is authorized to be appropriated to 

11 the Administration $86,000,000, to make loans under sec12 tion 7(b) of the Small Business Act. 

13 SEC. 4. ENERGY EMERGENCY RELIEF. 

14 (a) SMALL BUSINESS AND FARM ENERGY EMER15 GENCY DISASTER LOAN PROGRAM.— 

16 (1) SMALL BUSINESS DISASTER LOAN AUTHOR17 ITY.—Section 7(b) of the Small Business Act (15 

18 U.S.C. 636(b)) is amended by inserting immediately 

19 after paragraph (5), as added by this Act, the fol20 lowing: 

21 ‘‘(6) ENERGY EMERGENCY RELIEF.— 

22 ‘‘(A) DEFINITIONS.—For purposes of this 

23 paragraph— 

24 ‘‘(i) the term ‘base price index’ means 

25 the moving average of the closing unit 
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1 price on the New York Mercantile Ex2 change for heating oil, natural gas, gaso3 line, or propane for the 10 days, in each 

4 of the most recent 2 preceding years, 

5 which correspond to the trading days de6 scribed in clause (ii); 

7 ‘‘(ii) the term ‘current price index’ 

8 means the moving average of the closing 

9 unit price on the New York Mercantile Ex10 change, for the 10 most recent trading 

11 days, for contracts to purchase heating oil, 

12 natural gas, gasoline, or propane during 

13 the subsequent calendar month, commonly 

14 known as the ‘front month’; 

15 ‘‘(iii) the term ‘significant increase’ 

16 means— 

17 ‘‘(I) with respect to the price of 

18 heating oil, natural gas, gasoline, or 

19 propane, any time the current price 

20 index exceeds the base price index by 

21 not less than 40 percent; and 

22 ‘‘(II) with respect to the price of 

23 kerosene, any increase which the Ad24 ministrator, in consultation with the 
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1 Secretary of Energy, determines to be 

2 significant; and 

3 ‘‘(iv) a small business concern en4 gaged in the heating oil business is eligible 

5 for a loan, if the small business concern 

6 sells not more than 10,000,000 gallons of 

7 heating oil per year. 

8 ‘‘(B) LOAN AUTHORITY.—The Administra9 tion may make such loans, either directly or in 

10 cooperation with banks or other lending institu11 tions through agreements to participate on an 

12 immediate or deferred basis, to assist a small 

13 business concern that has suffered or that is 

14 likely to suffer substantial economic injury on 

15 or after August 24, 2005, as the result of a sig16 nificant increase in the price of heating oil, nat17 ural gas, gasoline, propane, or kerosene occur18 ring on or after August 24, 2005. 

19 ‘‘(C) APPLICABLE INTEREST RATE.—Any 

20 loan or guarantee extended pursuant to this 

21 paragraph shall be made at the same interest 

22 rate as economic injury loans under paragraph 

23 (2). 

24 ‘‘(D) LOAN LIMITATION.—No loan may be 

25 made under this paragraph, either directly or in 
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1 cooperation with banks or other lending institu2 tions through agreements to participate on an 

3 immediate or deferred basis, if the total amount 

4 outstanding and committed to the borrower 

5 under this subsection would exceed $1,500,000, 

6 unless such borrower constitutes a major source 

7 of employment in its surrounding area, as de8 termined by the Administrator, in which case 

9 the Administrator, in its discretion, may waive 

10 the $1,500,000 limitation. 

11 ‘‘(E) LOAN CRITERIA.—For purposes of 

12 assistance under this paragraph— 

13 ‘‘(i) a declaration of a disaster area 

14 based on conditions specified in this para15 graph shall be required, and shall be made 

16 by the President or the Administrator; or 

17 ‘‘(ii) if no declaration has been made 

18 pursuant to clause (i), the Governor of a 

19 State in which a significant increase in the 

20 price of heating oil, natural gas, gasoline, 

21 propane, or kerosene has occurred may 

22 certify to the Administration that small 

23 business concerns have suffered economic 

24 injury as a result of such increase and are 

25 in need of financial assistance which is not 
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1 otherwise available on reasonable terms in 

2 that State, and upon receipt of such cer3 tification, the Administration may make 

4 such loans as would have been available 

5 under this paragraph if a disaster declara6 tion had been issued. 

7 ‘‘(F) PERMISSIBLE USES.—Notwith8 standing any other provision of law, loans made 

9 under this paragraph may be used by a small 

10 business concern described in subparagraph (B) 

11 to convert from the use of heating oil, natural 

12 gas, gasoline, propane, or kerosene to a renew13 able or alternative energy source, including ag14 riculture and urban waste, geothermal energy, 

15 cogeneration, solar energy, wind energy, or fuel 

16 cells.’’. 

17 (2) CONFORMING AMENDMENTS.—Section 3(k) 

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

19 amended— 

20 (A) by inserting ‘‘, significant increase in 

21 the price of heating oil, natural gas, gasoline, 

22 propane, or kerosene’’ after ‘‘civil disorders’’; 

23 and 

24 (B) by inserting ‘‘other’’ before ‘‘eco25 nomic’’. 
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1 (3) REPORT.—Not later than 12 months after 

2 the date on which the Administrator issues guide3 lines under subsection (c)(1), and annually there4 after, until the date that is 12 months after the end 

5 of the effective period of section 7(b)(6) of the Small 

6 Business Act, as added by this subsection, the Ad7 ministrator shall submit to the Committee on Small 

8 Business and Entrepreneurship of the Senate and 

9 the Committee on Small Business of the House of 

10 Representatives, a report on the effectiveness of the 

11 assistance made available under section 7(b)(6) of 

12 the Small Business Act, as added by this subsection, 

13 including— 

14 (A) the number of small business concerns 

15 that applied for a loan under that section 

16 7(b)(6) and the number of those that received 

17 such loans; 

18 (B) the dollar value of those loans; 

19 (C) the States in which the small business 

20 concerns that received such loans are located; 

21 (D) the type of energy that caused the sig22 nificant increase in the cost for the partici23 pating small business concerns; and 
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1 (E) recommendations for ways to improve 

2 the assistance provided under that section 

3 7(b)(6), if any. 

4 (4) EFFECTIVE DATE.—The amendments made 

5 by this subsection shall apply during the 4-year pe6 riod beginning on the earlier of the date on which 

7 guidelines are published by the Administrator under 

8 subsection (c)(1), or 30 days after the date of enact9 ment of this Act, with respect to assistance under 

10 section 7(b)(6) of the Small Business Act, as added 

11 by this subsection. 

12 (b) FARM ENERGY EMERGENCY RELIEF.— 

13 (1) IN GENERAL.—Section 321(a) of the Con14 solidated Farm and Rural Development Act (7 

15 U.S.C. 1961(a)) is amended— 

16 (A) in the first sentence— 

17 (i) by striking ‘‘operations have’’ and 

18 inserting ‘‘operations (i) have’’; and 

19 (ii) by inserting before ‘‘: Provided,’’ 

20 the following: ‘‘, or (ii)(I) are owned or op21 erated by such an applicant that is also a 

22 small business concern (as defined in sec23 tion 3 of the Small Business Act (15 

24 U.S.C. 632)), and (II) have suffered or are 

25 likely to suffer substantial economic injury 
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1 on or after August 24, 2005, as the result 

2 of a significant increase in energy costs or 

3 input costs from energy sources occurring 

4 on or after August 24, 2005, in connection 

5 with an energy emergency declared by the 

6 President or the Secretary’’; 

7 (B) in the third sentence, by inserting be8 fore the period at the end the following: ‘‘or by 

9 an energy emergency declared by the President 

10 or the Secretary’’; and 

11 (C) in the fourth sentence— 

12 (i) by inserting ‘‘or energy emer13 gency’’ after ‘‘natural disaster’’ each place 

14 that term appears; and 

15 (ii) by inserting ‘‘or declaration’’ after 

16 ‘‘emergency designation’’. 

17 (2) FUNDING.—Funds available on the date of 

18 enactment of this Act for emergency loans under 

19 subtitle C of the Consolidated Farm and Rural De20 velopment Act (7 U.S.C. 1961 et seq.) shall be avail21 able to carry out the amendments made by para22 graph (1) to meet the needs resulting from natural 

23 disasters. 

24 (3) REPORT.—Not later than 12 months after 

25 the date on which the Secretary of Agriculture 
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1 issues guidelines under subsection (c)(1), and annu2 ally thereafter, the Secretary shall submit to the 

3 Committee on Small Business and Entrepreneurship 

4 and the Committee on Agriculture, Nutrition, and 

5 Forestry of the Senate and to the Committee on 

6 Small Business and the Committee on Agriculture of 

7 the House of Representatives, a report that— 

8 (A) describes the effectiveness of the as9 sistance made available under section 321(a) of 

10 the Consolidated Farm and Rural Development 

11 Act (7 U.S.C. 1961(a)), as amended by this 

12 section; and 

13 (B) contains recommendations for ways to 

14 improve the assistance provided under such sec15 tion 321(a). 

16 (4) EFFECTIVE DATE.—The amendments made 

17 by this subsection shall apply during the 4-year pe18 riod beginning on the earlier of the date on which 

19 guidelines are published by the Secretary of Agri20 culture under subsection (c)(1), or 30 days after the 

21 date of enactment of this Act, with respect to assist22 ance under section 321(a) of the Consolidated Farm 

23 and Rural Development Act (7 U.S.C. 1961(a)), as 

24 amended by this subsection. 

25 (c) GUIDELINES AND RULEMAKING.— 
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1 (1) GUIDELINES.—Not later than 30 days after 

2 the date of enactment of this Act, the Administrator 

3 and the Secretary of Agriculture shall each issue 

4 guidelines to carry out subsections (a) and (b), re5 spectively, and the amendments made thereby, which 

6 guidelines shall become effective on the date of their 

7 issuance. 

8 (2) RULEMAKING.—Not later than 30 days 

9 after the date of enactment of this Act, the Adminis10 trator, after consultation with the Secretary of En11 ergy, shall promulgate regulations specifying the 

12 method for determining a significant increase in the 

13 price of kerosene under section 7(b)(6)(A)(iii)(II) of 

14 the Small Business Act, as added by this Act. 

15 SEC. 5. SUPPLEMENTAL EMERGENCY LOANS. 

16 (a) IN GENERAL.—Section 7(a) of the Small Busi17 ness Act (15 U.S.C. 636(a)) is amended by adding at the 

18 end the following: 

19 ‘‘(32) SUPPLEMENTAL EMERGENCY LOANS

20 AFTER HURRICANE KATRINA AND HURRICANE

21 RITA.— 

22 ‘‘(A) LOAN AUTHORITY.—In addition to 

23 any other loan authorized by this subsection, 

24 the Administrator shall make such loans under 

25 this subsection (either directly or in cooperation 
19 

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1 with banks or other lending institutions through 

2 agreements to participate on an immediate or 

3 deferred basis) as the Administrator determines 

4 appropriate to a small business concern, located 

5 anywhere in the United States, that is directly 

6 adversely affected by Hurricane Katrina or 

7 Hurricane Rita, based on such criteria as the 

8 Administrator may set by rule, regulation, or 

9 order, subject to subparagraph (B). 

10 ‘‘(B) OVERSIGHT PROTECTIONS.—In mak11 ing any loan under subparagraph (A)— 

12 ‘‘(i) the borrower shall be made aware 

13 that such loans are for those directly ad14 versely affected by Hurricane Katrina or 

15 Hurricane Rita, as the case may be; and 

16 ‘‘(ii) if such loans are made in co17 operation with a bank or other lending in18 stitution— 

19 ‘‘(I) lenders shall document for 

20 the Administrator how the borrower 

21 was directly adversely affected by 

22 Hurricane Katrina or Hurricane Rita; 

23 ‘‘(II) not later than 6 months 

24 after the date of enactment of this 

25 paragraph, and every 6 months there-
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1 after until the date that is 18 months 

2 after the date of enactment of this 

3 paragraph, the Inspector General of 

4 the Administration shall make a re5 port regarding such loans to the Com6 mittee on Small Business and Entre7 preneurship of the Senate and the 

8 Committee on Small Business of the 

9 House of Representatives, including 

10 verification that the program is being 

11 administered appropriately and that 

12 such loans are being used for pur13 poses authorized by this paragraph; 

14 and 

15 ‘‘(III) not later than 12 months 

16 after the date on which the final re17 port submitted by the Inspector Gen18 eral under subclause (II), the Comp19 troller General of the United States 

20 shall conduct a review of the adminis21 tration of the supplemental emergency 

22 loan program authorized under this 

23 paragraph and submit a report to the 

24 Committee on Small Business and 

25 Entrepreneurship of the Senate and 
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1 the Committee on Small Business of 

2 the House of Representatives con3 taining the findings of the review and 

4 any recommendations. 

5 ‘‘(C) FEES.— 

6 ‘‘(i) IN GENERAL.—Notwithstanding 

7 any other provision of law, the Adminis8 trator shall, in lieu of the fee established 

9 under paragraph (23)(A), collect an annual 

10 fee of 0.25 percent of the outstanding bal11 ance of deferred participation loans made 

12 under this subsection to a small business 

13 concern, located anywhere in the United 

14 States, directly adversely affected by Hur15 ricane Katrina or Hurricane Rita for a pe16 riod of 1 year after the date of enactment 

17 of this paragraph. 

18 ‘‘(ii) GUARANTEE FEES.—Notwith19 standing any other provision of law, the 

20 guarantee fee under paragraph (18)(A) for 

21 a period of 1 year after the date of enact22 ment of this subparagraph shall be as fol23 lows: 

24 ‘‘(I) A guarantee fee equal to 1 

25 percent of the deferred participation 
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1 share of a total loan amount that is 

2 not more than $150,000. 

3 ‘‘(II) A guarantee fee equal to 

4 2.5 percent of the deferred participa5 tion share of a total loan amount that 

6 is more than $150,000, but not more 

7 than $700,000. 

8 ‘‘(III) A guarantee fee equal to 

9 3.5 percent of the deferred participa10 tion share of a total loan amount that 

11 is more than $700,000.’’. 

12 (b) AUTHORIZATION OF APPROPRIATIONS.—There is 

13 authorized to be appropriated $75,000,000 to carry out 

14 section 7(a)(32) of the Small Business Act, as added by 

15 this section. 

16 SEC. 6. DEVELOPMENT COMPANY DEBENTURES. 

17 (a) AUTHORITY.—Section 503 of the Small Business 

18 Investment Act of 1958 (15 U.S.C. 697) is amended by 

19 adding at the end the following: 

20 ‘‘(j) DEBENTURES AFTER HURRICANE KATRINA AND

21 HURRICANE RITA.— 

22 ‘‘(1) AUTHORITY.— 

23 ‘‘(A) IN GENERAL.—In addition to any 

24 other guarantee authorized by this section, the 

25 Administrator may guarantee the timely pay-
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1 ment of all principal and interest as scheduled 

2 on any debenture issued to a qualified borrower. 

3 ‘‘(B) TERMS.—The Administrator shall es4 tablish a fee for a guarantee issued under sub5 paragraph (A) that is lower than that for other 

6 guarantees under this section. 

7 ‘‘(2) EXISTING GUARANTEES.— 

8 ‘‘(A) IN GENERAL.—Notwithstanding any 

9 other provision of law, the Administrator may 

10 temporarily defer payments of principal and in11 terest on a guarantee made under this section 

12 before the date of enactment of this subsection 

13 to a qualified borrower located in a Disaster 

14 Area, in any case in which the payments are 

15 owed to the Administration. 

16 ‘‘(B) PAYMENTS TO OTHER PARTIES.— 

17 Notwithstanding any other provision of law, the 

18 Administrator may temporarily make payments 

19 of principal and interest on a loan made under 

20 this section before the date of enactment of this 

21 subsection to a qualified borrower located in a 

22 Disaster Area, in any case in which the pay23 ments are owed to a person other than the Ad24 ministration. 
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1 ‘‘(C) TERMINATION OF AUTHORITY.—The 

2 authority to defer, or make, payments under 

3 this paragraph shall terminate 1 year after the 

4 date of enactment of this subsection. 

5 ‘‘(3) DEFINITIONS.—In this subsection, the fol6 lowing definitions shall apply: 

7 ‘‘(A) DISASTER AREA.—The term ‘Disaster 

8 Area’ means an area which the President has 

9 designated as a disaster area as a result of 

10 Hurricane Katrina of August 2005 or Hurri11 cane Rita of September 2005. 

12 ‘‘(B) QUALIFIED BORROWER.—The term 

13 ‘qualified borrower’ means a small business con14 cern located anywhere in the United States that 

15 has been directly adversely affected by Hurri16 cane Katrina or Hurricane Rita, based on such 

17 criteria as the Administrator may set by rule, 

18 regulation, or order.’’. 

19 (b) AUTHORIZATION OF APPROPRIATIONS.—There is 

20 authorized to be appropriated $75,000,000 to carry out 

21 section 503(j) of the Small Business Investment Act of 

22 1958, as added by this section. 
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1 SEC. 7. SMALL BUSINESS EMERGENCY RELIEF. 

2 (a) BUSINESS LOAN PROGRAMS.—Section 

3 20(e)(1)(B) of the Small Business Act (15 U.S.C. 631 

4 note) is amended— 

5 (1) in the matter preceding clause (i), by strik6 ing ‘‘$25,050,000,000’’ and inserting 

7 ‘‘$40,050,000,000’’; 

8 (2) in clause (i), by striking ‘‘$17,000,000,000’’ 

9 and inserting ‘‘$27,000,000,000’’; and 

10 (3) in clause (ii), by striking ‘‘$7,500,000,000’’ 

11 and inserting ‘‘$12,500,000,000’’. 

12 (b) GRANTS TO STATES DAMAGED BY HURRICANE

13 KATRINA OR HURRICANE RITA.— 

14 (1) IN GENERAL.—There is authorized to be 

15 appropriated to the Secretary of Commerce 

16 $450,000,000 for the Economic Development Ad17 ministration of the Department of Commerce to 

18 make grants to the appropriate State government 

19 agencies in Louisiana, Alabama, Mississippi, Texas, 

20 and Florida, to carry out this subsection. 

21 (2) DISBURSEMENT OF FUNDS.—The Depart22 ment of Commerce shall disburse the funds author23 ized under paragraph (1) in the most expeditious 

24 manner possible to the designated States, based 

25 on— 
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1 (A) the number of businesses directly dam2 aged or disrupted by Hurricane Katrina or 

3 Hurricane Rita in the State; 

4 (B) the number of residents displaced from 

5 the State by Hurricane Katrina or Hurricane 

6 Rita; 

7 (C) the number of jobs lost or disrupted by 

8 Hurricane Katrina or Hurricane Rita in the 

9 State; 

10 (D) the extent of economic disruption by 

11 Hurricane Katrina or Hurricane Rita in the 

12 State; and 

13 (E) the number of evacuees from any other 

14 State due to Hurricane Katrina or Hurricane 

15 Rita to whom the designated State is providing 

16 assistance. 

17 (3) USE OF FUNDS.— 

18 (A) IN GENERAL.—Grants awarded to a 

19 State under paragraph (1) shall be used by the 

20 State to provide bridge grants and loans, which 

21 may be made to any person located in a Dis22 aster Area who was directly adversely affected 

23 by Hurricane Katrina or Hurricane Rita, to as24 sist such person in covering costs until the per-
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1 son is able to obtain loans through Administra2 tion assistance programs or other sources. 

3 (B) REIMBURSEMENT.—A State may use a 

4 grant awarded under paragraph (1) as reim5 bursement for any State funds used to provide 

6 bridge grants or loans to any person located in 

7 a Disaster Area who was directly adversely af8 fected by Hurricane Katrina or Hurricane Rita 

9 before the date on which the funds authorized 

10 under paragraph (1) are disbursed. 

11 (C) CRITERIA.—Notwithstanding any 

12 other provision of law, in making bridge grants 

13 and loans under subparagraph (A), the State 

14 may use such criteria as the State determines 

15 appropriate, and shall not be required to apply 

16 eligibility criteria for programs administered by 

17 the Department of Commerce. 

18 (D) TERMS.—For any loan made by a 

19 State under subparagraph (A)— 

20 (i) such a loan may initially be a 

21 noncollateralized, low-interest loan; 

22 (ii) payments and interest on such a 

23 loan may be deferred for at least 1 year 

24 after the date on which the loan is made; 
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1 (iii) the balance remaining on such a 

2 loan 5 years after the date on which the 

3 loan is made may be forgiven entirely by 

4 the State, if the borrower has continued to 

5 operate during that 5-year period in a Dis6 aster Area; and 

7 (iv) such a loan may be forgiven by 

8 the State, under such terms as it may set, 

9 if the borrower cannot repay such loan. 

10 (E) ADMINISTRATIVE EXPENSES.—The 

11 Department of Commerce may use not more 

12 than $1,000,000 of the funds authorized under 

13 paragraph (1) to administer the provision of 

14 grants to the designated States under this sub15 section. 

16 SEC. 8. BUSINESS COUNSELING. 

17 In addition to any other amounts authorized for any 

18 fiscal year, there are authorized to be appropriated to the 

19 Administration, to remain available until expended, for fis20 cal year 2006— 

21 (1) $21,000,000, to be used for activities of 

22 small business development centers pursuant to sec23 tion 21 of the Small Business Act, not less than 

24 $15,000,000 of which shall be non-matching funds 
29 

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1 and used to aid and assist small business concerns 

2 affected by Hurricane Katrina or Hurricane Rita; 

3 (2) $2,000,000, to be used for the SCORE pro4 gram authorized by section 8(b)(1) of the Small 

5 Business Act, for the activities described in section 

6 8(b)(1)(B)(ii) of that Act, not less than $1,000,000 

7 of which shall be used to aid and assist small busi8 ness concerns affected by Hurricane Katrina or 

9 Hurricane Rita; 

10 (3) $4,500,000, to be used for activities of 

11 women’s business centers authorized by section 

12 29(b) of the Small Business Act and for recipients 

13 of a grant under section 29(l) of that Act, not less 

14 than $2,500,000 of which shall be non-matching 

15 funds used to aid and assist small business concerns 

16 affected by Hurricane Katrina or Hurricane Rita, 

17 which may also be made available to a women’s busi18 ness center whose 5-year project ended in fiscal year 

19 2004; 

20 (4) $1,250,000, to be used for activities of the 

21 office of veteran’s business development pursuant to 

22 section 32 of the Small Business Act, not less than 

23 $750,000 of which shall be used to aid and assist 

24 small business concerns affected by Hurricane 

25 Katrina or Hurricane Rita; and 
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1 (5) $5,000,000, to be used for activities of the 

2 microloan program authorized by clauses (ii) and 

3 (iii) of section 7(m)(1)(G) of the Small Business Act 

4 to aid and assist small business concerns adversely 

5 affected by Hurricane Katrina or Hurricane Rita. 

6 SEC. 9. SMALL BUSINESS DEVELOPMENT CENTERS. 

7 (a) WAIVER OF MAXIMUM AMOUNT.—Section 

8 21(a)(4) of the Small Business Act (15 U.S.C. 648(a)(4)) 

9 is amended by adding at the end the following: 

10 ‘‘(D) FISCAL YEARS 2005 AND 2006.—For fiscal 

11 years 2005 and 2006, the Administrator has the au12 thority to waive the maximum amount of $100,000 

13 for grants under subparagraph (C)(viii), and such 

14 grants shall be made available for small business de15 velopment centers assisting small business concerns 

16 adversely affected by Hurricane Katrina or Hurri17 cane Rita.’’. 

18 (b) ASSISTANCE AFTER HURRICANE KATRINA AND

19 HURRICANE RITA.—Section 21(b) of the Small Business 

20 Act (15 U.S.C. 648(b)) is amended by adding at the end 

21 the following: 

22 ‘‘(4) ASSISTANCE AFTER HURRICANE KATRINA AND

23 HURRICANE RITA.— 

24 ‘‘(A) IN GENERAL.—The Administration shall 

25 authorize any small business development center, re-
31 

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1 gardless of location, to provide advice, information, 

2 and assistance, as described in subsection (c), to a 

3 small business concern located in an area which the 

4 President has designated as a disaster area as a re5 sult of Hurricane Katrina of August 2005 or Hurri6 cane Rita of September 2005. 

7 ‘‘(B) CONTINUITY OF SERVICES.—A small busi8 ness development center that provides counselors to 

9 an area described in subparagraph (A) shall, to the 

10 maximum extent practicable, ensure continuity of 

11 services in the State it currently serves.’’. 

12 SEC. 10. HUBZONES. 

13 Section 3(p)(1) of the Small Business Act (15 U.S.C. 

14 632(p)(1)) is amended— 

15 (1) in subparagraph (D), by striking ‘‘or’’; 

16 (2) in subparagraph (E), by striking the period 

17 at the end and inserting ‘‘; or’’; and 

18 (3) by adding at the end the following: 

19 ‘‘(F) an area which the President has des20 ignated as a disaster area as a result of Hurri21 cane Katrina of August 2005 or Hurricane Rita 

22 of September 2005.’’. 

23 SEC. 11. OUTREACH PROGRAMS. 

24 (a) IN GENERAL.—Not later than 90 days after the 

25 date of enactment of this Act, the Administrator shall es-
32 

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1 tablish a contracting outreach and technical assistance 

2 program for small business concerns which have had a pri3 mary place of business in, or other significant presence 

4 in a Disaster Area at any time following the 60 days prior 

5 to the designation of such area by the Administrator. 

6 (b) ADMINISTRATOR ACTION.—The Administrator 

7 may fulfill the requirement of subsection (a) by acting 

8 through— 

9 (1) the Administration; 

10 (2) the Federal agency small business officials 

11 designated under section 15(k)(1) of the Small Busi12 ness Act (15 U.S.C. 644(k)(1)); or 

13 (3) any Federal, State, or local government en14 tity, higher education institution, or private non15 profit organization that the Administrator may deem 

16 appropriate, upon conclusion of a memorandum of 

17 understanding or assistance agreement, as appro18 priate, with the Administrator. 

19 SEC. 12. SMALL BUSINESS BONDING THRESHOLD. 

20 Notwithstanding any other provision of law, for all 

21 procurements related to Hurricane Katrina or Hurricane 

22 Rita, the Administrator may, upon such terms and condi23 tions as it may prescribe, guarantee and enter into com24 mitments to guarantee any surety against loss resulting 

25 from a breach of the terms of a bid bond, payment bond, 
33 

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1 performance bond, or bonds ancillary thereto, by a prin2 cipal on any total work order or contract amount at the 

3 time of bond execution that does not exceed $5,000,000, 

4 except that the Administrator may increase such amount 

5 to $10,000,000, at the discretion of the Administrator. 

6 SEC. 13. SMALL BUSINESS PARTICIPATION. 

7 In order to facilitate the maximum practicable par8 ticipation of small business concerns in activities related 

9 to relief and recovery from Hurricane Katrina and Hurri10 cane Rita, the Administrator and the head of any Federal 

11 agency making procurements related to the aftermath of 

12 Hurricane Katrina or Hurricane Rita, shall set a goal, to 

13 be met within a reasonable time, of awarding to small 

14 business concerns not less than 30 percent of amounts ex15 pended for prime contracts and not less than 40 percent 

16 of amounts expended for subcontracts on procurements by 

17 such agency related to the aftermath of Hurricane Katrina 

18 or Hurricane Rita, respectively. 

19 SEC. 14. MICROPURCHASES. 

20 (a) IN GENERAL.—Section 101 of the Second Emer21 gency Supplemental Appropriations Act to Meet Imme22 diate Needs Arising From the Consequences of Hurricane 

23 Katrina, 2005 (Public Law 109–62; 119 Stat. 1990) is 

24 repealed. 
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1 (b) AUTHORITY.—The authority provided in sub2 section 32A of the Office of Federal Procurement Policy 

3 Act (41 U.S.C. 428a) may be used with respect to any 

4 procurement for property or services determined by the 

5 head of an Executive agency to be necessary for support 

6 of Hurricane Katrina or Hurricane Rita rescue and relief 

7 operations. 

8 (c) EXPIRATION.—The authority provided by sub9 section (b) shall expire on the date that is 180 days after 

10 the date of enactment of this Act. 

11 SEC. 15. LOAN DEFAULTS. 

12 Notwithstanding any other provision of law, no loan 

13 made before August 24, 2005, under subsection (a) or (m) 

14 of section 7 of the Small Business Act or title III or sec15 tion 503 of the Small Business Investment Act of 1958 

16 for which the borrower goes into default because of Hurri17 cane Katrina or Hurricane Rita shall be considered a cost, 

18 as that term is defined in section 502 of the Federal Cred19 it Reform Act of 1990, to the Administration for purposes 

20 of calculating the subsidy rate for loans under subsection 

21 (a) or (m) of section 7 of the Small Business Act or title 

22 III or section 503 of the Small Business Investment Act 

23 of 1958, respectively. 
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1 SEC. 16. BUDGETARY TREATMENT OF LOANS AND 

2 FINANCINGS. 

3 (a) IN GENERAL.—Assistance made available under 

4 any loan made or approved by the Administration under 

5 this Act, subsections (a) or (b) of section 7 of the Small 

6 Business Act (15 U.S.C. 636(a)), as amended by this Act, 

7 or financings made under title V of the Small Business 

8 Investment Act of 1958 (15 U.S.C. 695 et seq.), as 

9 amended by this Act, on and after the date of enactment 

10 of this Act, shall be treated as separate programs of the 

11 Administration for purposes of the Federal Credit Reform 

12 Act of 1990 only. 

13 (b) USE OF FUNDS.—Assistance under this Act and 

14 the amendments made by this Act shall be available only 

15 to the extent that funds are made available under appro16 priations Acts, which funds shall be utilized to offset the 

17 cost (as such term is defined in section 502 of the Federal 

18 Credit Reform Act of 1990) of such assistance. 

19 SEC. 17. EMERGENCY PROCUREMENT AUTHORITY. 

20 (a) SMALL BUSINESS RESERVATION OFFSET.—Sec21 tion 15(j) of the Small Business Act (15 U.S.C. 644(j)) 

22 is amended by adding at the end the following: 

23 ‘‘(4) For any contracts involving the use of the spe24 cial emergency procurement authority under section 

25 32A(c) of the Office of Federal Procurement Policy Act 

26 (41 U.S.C. 428a(c)), the dollar ceiling of the small busi-
36 

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1 ness reservation established in paragraph (1) shall be ad2 justed to match the applicable amount of the simplified 

3 acquisition threshold.’’. 

4 (b) RETENTION OF SMALL BUSINESS SUBCON5 TRACTING.—Section 8(d)(4)(D) of the Small Business Act 

6 (15 U.S.C. 637(d)(4)(D)) is amended— 

7 (1) by striking ‘‘(D) No contract’’ and inserting 

8 the following: 

9 ‘‘(D) SMALL BUSINESS PARTICIPATION.— 

10 ‘‘(i) IN GENERAL.—No contract’’; and 

11 (2) by adding at the end the following: 

12 ‘‘(ii) EMERGENCY PROCUREMENTS.— 

13 ‘‘(I) IN GENERAL.—For any contract 

14 which otherwise meets the requirements of 

15 this subsection, and which involves the use 

16 of special emergency procurement author17 ity under section 32A(c) of the Office of 

18 Federal Procurement Policy Act (41 

19 U.S.C. 428a(c)), the subcontracting plan 

20 required under this subsection shall be ne21 gotiated as soon as is practicable, but not 

22 later than 30 days after the date on which 

23 the contract is awarded. 

24 ‘‘(II) PAYMENT.—Not greater than 

25 50 percent of the amounts due under any 
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1 contract described in subclause (I) may be 

2 paid, unless a subcontracting plan compli3 ant with this subsection is negotiated by 

4 the contractor.’’. 

Æ