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[Congressional Bills 114th Congress]
[From the U.S. Government Publishing Office]
[S. 1470 Introduced in Senate (IS)]

114th CONGRESS
  1st Session
                                S. 1470

  To amend the Small Business Act to provide additional assistance to 
 small business concerns for disaster recovery, and for other purposes.

_______________________________________________________________________

                   IN THE SENATE OF THE UNITED STATES

                              May 31, 2015

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

_______________________________________________________________________

                                 A BILL

 
  To amend the Small Business Act to provide additional assistance to 
 small business concerns for disaster recovery, 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; TABLE OF CONTENTS.

    (a) Short Title.--This Act may be cited as the ``Recovery 
Improvements for Small Entities After Disaster Act of 2015'' or the 
``RISE After Disaster Act of 2015''.
    (b) Table of Contents.--The table of contents for this Act is as 
follows:

Sec. 1. Short title; table of contents.
Sec. 2. Definitions.
          TITLE I--IMPROVEMENTS OF DISASTER RESPONSE AND LOANS

Sec. 101. Use of data sharing.
Sec. 102. Additional awards to small business development centers, 
                            women's business centers, SCORE, and FAST 
                            recipients for disaster recovery.
Sec. 103. Collateral requirements for disaster loans.
Sec. 104. Assistance to out-of-State business concerns to aid in 
                            disaster recovery.
Sec. 105. Fast-track SBIC applications.
Sec. 106. FAST priorities.
Sec. 107. Use of Federal surplus property in disaster areas.
Sec. 108. Recovery opportunity loans.
Sec. 109. Contractor malfeasance.
Sec. 110. Local contracting preferences and incentives.
               TITLE II--DISASTER PLANNING AND MITIGATION

Sec. 201. Use of physical damage disaster loans.
Sec. 202. Business recovery centers.
                      TITLE III--OTHER PROVISIONS

Sec. 301. Increased oversight of economic injury disaster loans.
Sec. 302. Reduction of paperwork burden.
Sec. 303. Report on web portal for disaster loan applicants.
Sec. 304. Local disaster contracting fairness.

SEC. 2. DEFINITIONS.

    In this Act--
            (1) the term ``7(b) loan program'' means assistance 
        provided by the Administration under section 7(b) of the Small 
        Business Act (15 U.S.C. 636(b));
            (2) the terms ``Administration'' and ``Administrator'' mean 
        the Small Business Administration and the Administrator 
        thereof, respectively;
            (3) the term ``covered supplemental appropriations'' means 
        amounts made available to the Administration through 
        supplemental appropriations for--
                    (A) the cost of direct loans authorized under 
                section 7(b) of the Small Business Act (15 U.S.C. 
                636(b)) for necessary expenses related to the 
                consequences of a major disaster declared by the 
                President under section 401 of the Robert T. Stafford 
                Disaster Relief and Emergency Assistance Act (42 U.S.C. 
                5170); and
                    (B) the direct administrative expenses of making 
                and servicing those loans;
            (4) the term ``major disaster'' means a major disaster 
        declared by the President under section 401 of the Robert T. 
        Stafford Disaster Relief and Emergency Assistance Act (42 
        U.S.C. 5170); and
            (5) the term ``small business concern'' has the meaning 
        given that term under section 3 of the Small Business Act (15 
        U.S.C. 632).

          TITLE I--IMPROVEMENTS OF DISASTER RESPONSE AND LOANS

SEC. 101. USE OF DATA SHARING.

    Section 312 of the Robert T. Stafford Disaster Relief and Emergency 
Assistance Act (42 U.S.C. 5155) is amended by adding at the end the 
following:
    ``(e) Use of Data Sharing.--
            ``(1) Definition.--In this subsection, the term `agency' 
        has the meaning given the term in section 552a of title 5, 
        United States Code.
            ``(2) Exemption from certain matching program 
        requirements.--Any action taken by an agency to prevent, 
        investigate, or recover duplicative Federal assistance under 
        this section shall not be subject to subsections (e)(12), (o), 
        (q), (r), and (u) of section 552a of title 5, United States 
        Code.
            ``(3) Fraudulent acquisition of assistance.--An 
        investigation conducted by an agency relating to the fraudulent 
        acquisition of duplicative Federal assistance under this 
        section shall not be subject to section 552a(p) of title 5, 
        United States Code.''.

SEC. 102. ADDITIONAL AWARDS TO SMALL BUSINESS DEVELOPMENT CENTERS, 
              WOMEN'S BUSINESS CENTERS, SCORE, AND FAST RECIPIENTS FOR 
              DISASTER RECOVERY.

    Section 7(b) of the Small Business Act (15 U.S.C. 636(b)) is 
amended by inserting before the undesignated matter following paragraph 
(9) the following:
            ``(10) Additional awards to small business development 
        centers, women's business centers, score, and fast recipients 
        for disaster recovery.--
                    ``(A) In general.--The Administration may provide 
                financial assistance to a small business development 
                center, a women's business center described in section 
                29, the Service Corps of Retired Executives, a entity, 
                organization, or individual that receives an award or 
                has in effect a cooperative agreement under section 34, 
                or any proposed consortium of such individuals or 
                entities to spur disaster recovery and growth of small 
                business concerns located in an area for which the 
                President has declared a major disaster.
                    ``(B) Form of financial assistance.--Financial 
                assistance provided under this paragraph shall be in 
                the form of a grant, contract, or cooperative 
                agreement.
                    ``(C) No matching funds required.--Matching funds 
                shall not be required for any grant, contract, or 
                cooperative agreement under this paragraph.
                    ``(D) Requirements.--A recipient of financial 
                assistance under this paragraph shall provide 
                counseling, training, and other related services, such 
                as promoting long-term resiliency, to small business 
                concerns and entrepreneurs impacted by a major 
                disaster.
                    ``(E) Performance.--
                            ``(i) In general.--The Administrator, in 
                        cooperation with the recipients of financial 
                        assistance under this paragraph, shall 
                        establish metrics and goals for performance of 
                        grants, contracts, and cooperative agreements 
                        under this paragraph, which shall include 
                        recovery of sales, recovery of employment, 
                        reestablishment of business premises, and 
                        establishment of new small business concerns.
                            ``(ii) Use of estimates.--The Administrator 
                        shall base the goals and metrics for 
                        performance established under clause (i), in 
                        part, on the estimates of disaster impact 
                        prepared by the Office of Disaster Assistance 
                        for purposes of estimating loan-making 
                        requirements.
                    ``(F) Term.--
                            ``(i) In general.--The term of any grant, 
                        contract, or cooperative agreement under this 
                        paragraph shall be for not more than 2 years.
                            ``(ii) Extension.--The Administrator may 
                        make 1 extension of a grant, contract, or 
                        cooperative agreement under this paragraph for 
                        a period of not more than 1 year, upon a 
                        showing of good cause and need for the 
                        extension.
                    ``(G) Exemption from other program requirements.--
                Financial assistance provided under this paragraph is 
                in addition to, and wholly separate from, any other 
                form of assistance provided by the Administrator under 
                this Act.
                    ``(H) Competitive basis.--The Administration shall 
                award financial assistance under this paragraph on a 
                competitive basis.''.

SEC. 103. COLLATERAL REQUIREMENTS FOR DISASTER LOANS.

    (a) In General.--Section 7(d)(6) of the Small Business Act (15 
U.S.C. 636(d)(6)) is amended in the third proviso--
            (1) by striking ``$14,000'' and inserting ``$25,000''; and
            (2) by striking ``major disaster'' and inserting 
        ``disaster''.
    (b) Sunset.--Effective on the date that is 3 years after the date 
of enactment of this Act, section 7(d)(6) of the Small Business Act (15 
U.S.C. 636(d)(6)) is amended in the third proviso--
            (1) by striking ``$25,000'' and inserting ``$14,000''; and
            (2) by inserting ``major'' before ``disaster''.
    (c) Report.--Not later than 180 days before the date on which the 
amendments made by subsection (b) are to take effect, the Administrator 
shall submit to Committee on Small Business and Entrepreneurship of the 
Senate and the Committee on Small Business of the House of 
Representatives a report on the effects of the amendments made by 
subsection (a), which shall include--
            (1) an assessment of the impact and benefits resulting from 
        the amendments; and
            (2) a recommendation as to whether the amendments should be 
        made permanent.

SEC. 104. ASSISTANCE TO OUT-OF-STATE BUSINESS CONCERNS TO AID IN 
              DISASTER RECOVERY.

    (a) In General.--Section 21(b)(3) of the Small Business Act (15 
U.S.C. 648(b)(3)) is amended--
            (1) by striking ``(3) At the discretion'' and inserting the 
        following:
            ``(3) Assistance to out-of-state small business concerns.--
                    ``(A) In general.--At the discretion''; and
            (2) by adding at the end the following:
                    ``(B) Disaster recovery assistance.--
                            ``(i) In general.--At the discretion of the 
                        Administrator, the Administrator may authorize 
                        a small business development center to provide 
                        advice, information, and assistance, as 
                        described in subsection (c), to a small 
                        business concern located outside of the State, 
                        without regard to geographic proximity to the 
                        small business development center, if the small 
                        business concern is located in an area for 
                        which the President has declared a major 
                        disaster.
                            ``(ii) Term.--
                                    ``(I) In general.--A small business 
                                development center may provide advice, 
                                information, and assistance to a small 
                                business concern under clause (i) for a 
                                period of not more than 2 years after 
                                the date on which the President 
                                declared a major disaster for the area 
                                in which the small business concern is 
                                located.
                                    ``(II) Extension.--The 
                                Administrator may, at the discretion of 
                                the Administrator, extend the period 
                                described in subclause (I).
                            ``(iii) Continuity of services.--A small 
                        business development center that provides 
                        counselors to an area described in clause (i) 
                        shall, to the maximum extent practicable, 
                        ensure continuity of services in any State in 
                        which the small business development center 
                        otherwise provides services.
                            ``(iv) Access to disaster recovery 
                        facilities.--For purposes of this subparagraph, 
                        the Administrator shall, to the maximum extent 
                        practicable, permit the personnel of a small 
                        business development center to use any site or 
                        facility designated by the Administrator for 
                        use to provide disaster recovery assistance.''.
    (b) Sense of Congress.--It is the sense of Congress that, subject 
to the availability of funds, the Administrator should, to the extent 
practicable, ensure that a small business development center is 
appropriately reimbursed for any legitimate expenses incurred in 
carrying out activities under section 21(b)(3)(B) of the Small Business 
Act, as added by subsection (a).

SEC. 105. FAST-TRACK SBIC APPLICATIONS.

    Section 301(c)(2) of the Small Business Investment Act of 1958 (15 
U.S.C. 681(c)(2)) is amended by adding at the end the following:
                    ``(C) Priority for applicants located in disaster 
                areas.--
                            ``(i) Definition.--In this subparagraph, 
                        the term `disaster area' means the area for 
                        which the President has declared a major 
                        disaster (as defined in section 102 of the 
                        Robert T. Stafford Disaster Relief and 
                        Emergency Assistance Act (42 U.S.C. 5122)), 
                        during the period of the declaration.
                            ``(ii) Priority.--The Administrator shall 
                        give priority to an application for a license 
                        to operate as a small business investment 
                        company that is from an applicant located in a 
                        disaster area.''.

SEC. 106. FAST PRIORITIES.

    (a) Definitions.--Section 34(a) of the Small Business Act (15 
U.S.C. 657d(a)) is amended--
            (1) by redesignating paragraphs (3) through (9) as (4) 
        through (10), respectively; and
            (2) by inserting after paragraph (2) the following:
            ``(3) Catastrophic disaster.--The term `catastrophic 
        disaster' means a catastrophic disaster, as determined by the 
        Administrator.''.
    (b) Priority.--Section 34(c)(2) of the Small Business Act (15 
U.S.C. 657d(c)(2)) is amended--
            (1) in subparagraph (A), by striking ``and'' at the end;
            (2) in subparagraph (B)(vi)(III), by striking the period at 
        the end and inserting ``; and''; and
            (3) by adding at the end the following:
                    ``(C) shall give special consideration to an 
                applicant that is located in an area affected by a 
                catastrophic disaster.''.
    (c) Additional Assistance.--Section 34(c) of the Small Business Act 
(15 U.S.C. 657d(c)) is amended by adding at the end the following:
            ``(5) Additional assistance for catastrophic disasters.--
        Upon application by an applicant that receives an award or has 
        in effect a cooperative agreement under this section and that 
        is located in an area affected by a catastrophic disaster, the 
        Administrator may provide additional assistance to the 
        applicant.''.

SEC. 107. USE OF FEDERAL SURPLUS PROPERTY IN DISASTER AREAS.

    Section 7(j)(13)(F) of the Small Business Act (15 U.S.C. 
636(j)(13)(F)) is amended--
            (1) by inserting ``(i)'' after ``(F)''; and
            (2) by adding at the end the following:
                            ``(ii)(I) In this clause--
                                    ``(aa) the term `covered period' 
                                means the 2-year period beginning on 
                                the date on which the President 
                                declared the applicable major disaster; 
                                and
                                    ``(bb) the term `disaster area' 
                                means the area for which the President 
                                has declared a major disaster, during 
                                the covered period.
                            ``(II) The Administrator may transfer 
                        technology or surplus property under clause (i) 
                        on a priority basis to a small business concern 
                        located in a disaster area if--
                                    ``(aa) the small business concern 
                                meets the requirements for such a 
                                transfer, without regard to whether the 
                                small business concern is a Program 
                                Participant; and
                                    ``(bb) for a small business concern 
                                that is a Program Participant, on and 
                                after the date on which the President 
                                declared the applicable major disaster, 
                                the small business concern has not 
                                received property under this 
                                subparagraph on the basis of the status 
                                of the small business concern as a 
                                Program Participant.
                            ``(III) For any transfer of property under 
                        this clause to a small business concern, the 
                        terms and conditions shall be the same as a 
                        transfer to a Program Participant, except that 
                        the small business concern shall agree not to 
                        sell or transfer the property to any party 
                        other than the Federal Government during the 
                        covered period.
                            ``(IV) A small business concern that 
                        receives a transfer of property under this 
                        clause may not receive a transfer of property 
                        under clause (i) during the covered period.
                            ``(V) If a small business concern sells or 
                        transfers property in violation of the 
                        agreement described in subclause (III), the 
                        Administrator may initiate proceedings to 
                        prohibit the small business concern from 
                        receiving a transfer of property under this 
                        clause or clause (i), in addition to any other 
                        remedy available to the Administrator.''.

SEC. 108. RECOVERY OPPORTUNITY LOANS.

    Section 7(a)(31) of the Small Business Act (15 U.S.C. 636(a)(31)) 
is amended--
            (1) in subparagraph (A)--
                    (A) by redesignating clauses (i), (ii), and (iii) 
                as clauses (ii), (iii), and (iv), respectively; and
                    (B) by inserting before clause (ii), as so 
                redesignated, the following:
                            ``(i) The term `disaster area' means the 
                        area for which the President has declared a 
                        major disaster, during the 5-year period 
                        beginning on the date of the declaration.'';
            (2) by adding at the end the following:
                    ``(G) Recovery opportunity loans.--
                            ``(i) In general.--The Administrator may 
                        guarantee an express loan to a small business 
                        concern located in a disaster area in 
                        accordance with this subparagraph.
                            ``(ii) Maximums.--For a loan guaranteed 
                        under clause (i)--
                                    ``(I) the maximum loan amount is 
                                $150,000; and
                                    ``(II) the guarantee rate shall be 
                                not more than 85 percent.
                            ``(iii) Overall cap.--A loan guaranteed 
                        under clause (i) shall not be counted in 
                        determining the amount of loans made to a 
                        borrower for purposes of subparagraph (D).
                            ``(iv) Existing debt.--A loan guaranteed 
                        under clause (i) may be used to refinance 
                        existing debt arising from the applicable major 
                        disaster, subject to section 120.201 of title 
                        13, Code of Federal Regulations, or any 
                        successor thereto.
                            ``(v) Operations.--A small business concern 
                        receiving a loan guaranteed under clause (i) 
                        shall certify that the small business concern 
                        was in operation on the date on which the 
                        applicable major disaster occurred as a 
                        condition of receiving the loan.
                            ``(vi) Repayment ability.--A loan 
                        guaranteed under clause (i) may only be made to 
                        a small business concern that demonstrates, to 
                        the satisfaction of the Administrator, 
                        sufficient capacity to repay the loan.
                            ``(vii) Timing of payment of guarantees.--
                                    ``(I) In general.--Not later than 
                                90 days after the date on which the 
                                Administrator receives notice of a 
                                default on a loan guaranteed under 
                                clause (i), the Administrator shall 
                                determine whether to pay the guaranteed 
                                portion of the loan.
                                    ``(II) Recapture.--Unless there is 
                                a fraud relating to a loan guaranteed 
                                under clause (i), on and after the date 
                                that is 6 months after the date on 
                                which the Administrator determines to 
                                pay the guaranteed portion of the loan, 
                                the Administrator may not attempt to 
                                recapture the paid guarantee.''.

SEC. 109. CONTRACTOR MALFEASANCE.

    Section 7(b) of the Small Business Act (15 U.S.C. 636(b)) is 
amended by inserting before the undesignated matter following paragraph 
(10), as added by section 102 of this Act, the following:
            ``(11) Supplemental assistance for contractor 
        malfeasance.--
                    ``(A) In general.--If a contractor or other person 
                engages in malfeasance in connection with repairs to, 
                rehabilitation of, or replacement of real or personal 
                property relating to which a loan was made under this 
                subsection and the malfeasance results in substantial 
                economic damage to the recipient of the loan or 
                substantial risks to health or safety, upon receiving 
                documentation of the substantial economic damage or the 
                substantial risk to health and safety from an 
                independent loss verifier, and subject to subparagraph 
                (B), the Administrator may increase the amount of the 
                loan under this subsection, as necessary for the cost 
                of repairs, rehabilitation, or replacement needed to 
                address the cause of the economic damage or health or 
                safety risk.
                    ``(B) Requirements.--The Administrator may only 
                increase the amount of a loan under subparagraph (A) 
                upon receiving an appropriate certification from the 
                borrower and person performing the mitigation attesting 
                to the reasonableness of the mitigation costs and an 
                assignment of any proceeds received from the person 
                engaging in the malfeasance. The assignment of proceeds 
                recovered from the person engaging in the malfeasance 
                shall be equal to the amount of the loan under this 
                section. Any mitigation activities shall be subject to 
                audit and independent verification of completeness and 
                cost reasonableness.''.

SEC. 110. LOCAL CONTRACTING PREFERENCES AND INCENTIVES.

    Section 15 of the Small Business Act (15 U.S.C. 644) is amended by 
inserting after subsection (e) the following:
    ``(f) Contracting Preference for Small Business Concerns in a Major 
Disaster Area.--
            ``(1) Definition.--In this subsection, the term `disaster 
        area' means the area for which the President has declared a 
        major disaster, during the period of the declaration.
            ``(2) Contracting preference.--An agency shall provide a 
        contracting preference for a small business concern located in 
        a disaster area if the small business concern will perform the 
        work required under the contract in the disaster area.
            ``(3) Credit for meeting contracting goals.--If an agency 
        awards a contract to a small business concern under the 
        circumstances described in paragraph (2), the value of the 
        contract shall be doubled for purposes of determining 
        compliance with the goals for procurement contracts under 
        subsection (g)(1)(A).''.

               TITLE II--DISASTER PLANNING AND MITIGATION

SEC. 201. USE OF PHYSICAL DAMAGE DISASTER LOANS.

    Section 7(b)(1)(A) of the Small Business Act (15 U.S.C. 
636(b)(1)(A)) is amended in the second proviso--
            (1) by striking ``the Administration may increase'' and 
        inserting ``the Administration may, subject to section 18(a), 
        increase''; and
            (2) by striking ``and modifying structures'' and inserting 
        ``, and modifying structures (including construction of a safe 
        room or similar storm shelter designed to protect property and 
        occupants from tornadoes or other natural disasters)''.

SEC. 202. BUSINESS RECOVERY CENTERS.

    Section 7(b) of the Small Business Act (15 U.S.C. 636(b)) is 
amended by inserting before the undesignated matter following paragraph 
(11), as added by section 109 of this Act, the following:
            ``(12) Business recovery centers.--
                    ``(A) In general.--The Administrator, acting 
                through the district offices of the Administration, 
                shall identify locations that may be used as recovery 
                centers by the Administration in the event of a 
                disaster declared under this subsection or a major 
                disaster.
                    ``(B) Requirements for identification.--Each 
                district office of the Administration shall--
                            ``(i) identify a location described in 
                        subparagraph (A) in each county, parish, or 
                        similar unit of general local government in the 
                        area served by the district office; and
                            ``(ii) ensure that the locations identified 
                        under subparagraph (A) may be used as a 
                        recovery center without cost to the Government, 
                        to the extent practicable.''.

                      TITLE III--OTHER PROVISIONS

SEC. 301. INCREASED OVERSIGHT OF ECONOMIC INJURY DISASTER LOANS.

    (a) In General.--Section 7(b) of the Small Business Act (15 U.S.C. 
636(b)) is amended by inserting before the undesignated matter 
following paragraph (12), as added by section 202 of this Act, the 
following:
            ``(13) Increased oversight of economic injury disaster 
        loans.--The Administrator shall increase oversight of entities 
        receiving loans under paragraph (2), including through--
                    ``(A) scheduled site visits to ensure borrower 
                eligibility and compliance with requirements 
                established by the Administrator; and
                    ``(B) reviews of the use of the loan proceeds by an 
                entity described in paragraph (2) to ensure compliance 
                with requirements established by the Administrator.''.
    (b) Sense of Congress Relating to Using Existing Funds.--It is the 
sense of Congress that no additional Federal funds should be made 
available to carry out the amendments made by this section.

SEC. 302. REDUCTION OF PAPERWORK BURDEN.

    (a) Sense of Congress.--It is the sense of Congress that the 
Administrator should--
            (1) reduce paperwork burdens pursuant to section 3501 of 
        title 44, United States Code, on small business concerns 
        applying for disaster assistance under section 7(b) of the 
        Small Business Act (15 U.S.C. 636(b)); and
            (2) ensure that the application for disaster assistance 
        under section 7(b) of the Small Business Act (15 U.S.C. 636(b)) 
        facilitates deterring and detecting potential incidents of 
        waste, fraud, and abuse.
    (b) Reduction.--Section 7(b) of the Small Business Act (15 U.S.C. 
636(b)) is amended by inserting before the undesignated matter 
following paragraph (13), as added by section 301 of this Act, the 
following:
            ``(14) Paperwork reduction.--The Administrator shall take 
        steps to reduce, to the maximum extent practicable, the 
        paperwork associated with the application for a loan under this 
        subsection.''.

SEC. 303. REPORT ON WEB PORTAL FOR DISASTER LOAN APPLICANTS.

    Section 38 of the Small Business Act (15 U.S.C. 657j) is amended by 
adding at the end the following:
    ``(c) Report on Web Portal for Disaster Loan Application Status.--
            ``(1) In general.--Not later than 90 days after the date of 
        enactment of this subsection, 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 relating to the creation of a web 
        portal to the track the status of applications for disaster 
        assistance under section 7(b).
            ``(2) Contents.--The report under paragraph (1) shall 
        include--
                    ``(A) information on the progress of the 
                Administration in implementing the information system 
                under subsection (a);
                    ``(B) recommendations from the Administration 
                relating to the creation of a web portal for applicants 
                to check the status of an application for disaster 
                assistance under section 7(b), including a review of 
                best practices and web portal models from the private 
                sector;
                    ``(C) information on any related costs or staffing 
                needed to implement such a web portal;
                    ``(D) information on whether such a web portal can 
                maintain high standards for data privacy and data 
                security;
                    ``(E) information on whether such a web portal will 
                minimize redundancy among Administration disaster 
                programs, improve management of the number of inquiries 
                made by disaster applicants to employees located in the 
                area affected by the disaster and to call centers, and 
                reduce paperwork burdens on disaster victims; and
                    ``(F) such additional information as is determined 
                necessary by the Administrator.''.

SEC. 304. LOCAL DISASTER CONTRACTING FAIRNESS.

    (a) Definitions.--In this section--
            (1) the term ``executive agency'' has the meaning given 
        that term in section 133 of title 41, United States Code;
            (2) the term ``local subcontractor'' means, with respect to 
        a contract, a subcontractor who has a principal place of 
        business or regularly conducts operations in the area in which 
        work is to be performed under the contract by the 
        subcontractor; and
            (3) the term ``natural disaster reconstruction efforts'' 
        means reconstruction efforts undertaken in an area for which 
        the President has declared a major disaster under section 401 
        of the Robert T. Stafford Disaster Relief and Emergency 
        Assistance Act (42 U.S.C. 5170).
    (b) Federal Contracting Requirements.--
            (1) In general.--The head of an executive agency may not 
        enter into an agreement for debris removal or demolition 
        services in connection with natural disaster reconstruction 
        efforts unless the agreement specifies that--
                    (A) all of the work under the contract will be 
                performed by the prime contractor or 1 or more 
                subcontractors at 1 tier under the contract;
                    (B) any work performed under the contract by 
                subcontractors will be performed by local 
                subcontractors, except to the extent that local 
                subcontractors are not available to perform such work;
                    (C) the prime contractor will act as the project 
                manager or construction manager for the contract; and
                    (D) the prime contractor--
                            (i) has primary responsibility for managing 
                        all work under the contract; and
                            (ii) will be paid a certain percentage of 
                        the overall value of the contract as sole 
                        compensation for assuming the risk associated 
                        with such responsibility.
            (2) Preference for subcontractors affected by natural 
        disasters.--In entering into an agreement for debris removal or 
        demolition services in connection with natural disaster 
        reconstruction efforts, the head of an executive agency shall 
        give a preference in the source selection process to each 
        offeror who certifies that any work that is to be performed 
        under the contract by subcontractors will be performed by local 
        subcontractors.
    (c) Applicability.--The requirements under subsection (b) shall 
apply to agreements entered into on or after the date of enactment of 
this Act.
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