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[Congressional Bills 110th Congress]
[From the U.S. Government Publishing Office]
[S. 163 Engrossed in Senate (ES)]

  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
110th CONGRESS
  1st Session
                                 S. 163

_______________________________________________________________________

                                 AN ACT

 
      To improve the disaster loan program of the Small Business 
                Administration, 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 ``Small Business 
Disaster Response and Loan Improvements Act of 2007''.
    (b) Table of Contents.--The table of contents for this Act is as 
follows:

Sec. 1. Short title; table of contents.
Sec. 2. Definitions.
Sec. 3. Extension of program authority.
                TITLE I--DISASTER PLANNING AND RESPONSE

Sec. 101. Disaster loans to nonprofits.
Sec. 102. Disaster loan amounts.
Sec. 103. Small business development center portability grants.
Sec. 104. Assistance to out-of-State businesses.
Sec. 105. Outreach programs.
Sec. 106. Small business bonding threshold.
Sec. 107. Termination of program.
Sec. 108. Increasing collateral requirements.
Sec. 109. Public awareness of disaster declaration and application 
                            periods.
Sec. 110. Consistency between Administration regulations and standard 
                            operating procedures.
Sec. 111. Processing disaster loans.
Sec. 112. Development and implementation of major disaster response 
                            plan.
Sec. 113. Disaster planning responsibilities.
Sec. 114. Additional authority for district offices of the 
                            Administration.
Sec. 115. Assignment of employees of the Office of Disaster Assistance 
                            and Disaster Cadre.
                       TITLE II--DISASTER LENDING

Sec. 201. Catastrophic national disaster declaration.
Sec. 202. Private disaster loans.
Sec. 203. Technical and conforming amendments.
Sec. 204. Expedited disaster assistance loan program.
Sec. 205. HUBZones.
                TITLE III--DISASTER ASSISTANCE OVERSIGHT

Sec. 301. Congressional oversight.

SEC. 2. DEFINITIONS.

    In this Act--
            (1) the terms ``Administration'' and ``Administrator'' mean 
        the Small Business Administration and the Administrator 
        thereof, respectively;
            (2) the term ``catastrophic national disaster'' means a 
        catastrophic national disaster declared under section 7(b)(11) 
        of the Small Business Act (15 U.S.C. 636(b)), as added by this 
        Act;
            (3) the term ``declared disaster'' means a major disaster 
        or a catastrophic national disaster;
            (4) the term ``disaster area'' means an area affected by a 
        natural or other disaster, as determined for purposes of 
        paragraph (1) or (2) of section 7(b) of the Small Business Act 
        (15 U.S.C. 636(b)), during the period of such declaration;
            (5) the term ``disaster loan program of the 
        Administration'' means assistance under section 7(b) of the 
        Small Business Act (15 U.S.C. 636(b));
            (6) the term ``disaster update period'' means the period 
        beginning on the date on which the President declares a major 
        disaster or a catastrophic national disaster and ending on the 
        date on which such declaration terminates;
            (7) the term ``major disaster'' has the meaning given that 
        term in section 102 of the Robert T. Stafford Disaster Relief 
        and Emergency Assistance Act (42 U.S.C. 5122);
            (8) the term ``small business concern'' has the same 
        meaning as in section 3 of the Small Business Act (15 U.S.C. 
        632); and
            (9) the term ``State'' means any State of the United 
        States, the District of Columbia, the Commonwealth of Puerto 
        Rico, the Northern Mariana Islands, the Virgin Islands, Guam, 
        American Samoa, and any territory or possession of the United 
        States.

SEC. 3. EXTENSION OF PROGRAM AUTHORITY.

    (a) In General.--Section 1 of the Act entitled ``An Act to extend 
temporarily certain authorities of the Small Business Administration'', 
approved October 10, 2006 (Public Law 109-316; 120 Stat. 1742), is 
amended by striking ``July 31, 2007'' each place it appears and 
inserting ``October 31, 2007''.
    (b) Effective Date.--The amendments made by subsection (a) shall 
take effect on July 31, 2007.

                TITLE I--DISASTER PLANNING AND RESPONSE

SEC. 101. DISASTER LOANS TO NONPROFITS.

    Section 7(b) of the Small Business Act (15 U.S.C. 636(b)) is 
amended by inserting immediately after paragraph (3) the following:
            ``(4) Loans to nonprofits.--In addition to any other loan 
        authorized by this subsection, the Administrator may make such 
        loans (either directly or in cooperation with banks or other 
        lending institutions through agreements to participate on an 
        immediate or deferred basis) as the Administrator determines 
        appropriate to a nonprofit organization located or operating in 
        an area affected by a natural or other disaster, as determined 
        under paragraph (1) or (2), or providing services to persons 
        who have evacuated from any such area.''.

SEC. 102. DISASTER LOAN AMOUNTS.

    (a) Increased Loan Caps.--Section 7(b) of the Small Business Act 
(15 U.S.C. 636(b)) is amended by inserting immediately after paragraph 
(4), as added by this title, the following:
            ``(5) Increased loan caps.--
                    ``(A) Aggregate loan amounts.--Except as provided 
                in subparagraph (B), and notwithstanding any other 
                provision of law, the aggregate loan amount outstanding 
                and committed to a borrower under this subsection may 
                not exceed $2,000,000.
                    ``(B) Waiver authority.--The Administrator may, at 
                the discretion of the Administrator, increase the 
                aggregate loan amount under subparagraph (A) for loans 
                relating to a disaster to a level established by the 
                Administrator, based on appropriate economic indicators 
                for the region in which that disaster occurred.''.
    (b) Disaster Mitigation.--
            (1) In general.--Section 7(b)(1)(A) of the Small Business 
        Act (15 U.S.C. 636(b)(1)(A)) is amended by inserting ``of the 
        aggregate costs of such damage or destruction (whether or not 
        compensated for by insurance or otherwise)'' after ``20 per 
        centum''.
            (2) Effective date.--The amendment made by paragraph (1) 
        shall apply with respect to a loan or guarantee made after the 
        date of enactment of this Act.
    (c) Technical Amendments.--Section 7(b) of the Small Business Act 
(15 U.S.C. 636(b)) is amended--
            (1) in the matter preceding paragraph (1), by striking 
        ``the, Administration'' and inserting ``the Administration'';
            (2) in paragraph (2)(A), by striking ``Disaster Relief and 
        Emergency Assistance Act'' and inserting ``Robert T. Stafford 
        Disaster Relief and Emergency Assistance Act (42 U.S.C. 5121 et 
        seq.) (in this subsection referred to as a `major disaster')''; 
        and
            (3) in the undesignated matter at the end--
                    (A) by striking ``, (2), and (4)'' and inserting 
                ``and (2)''; and
                    (B) by striking ``, (2), or (4)'' and inserting 
                ``(2)''.

SEC. 103. SMALL BUSINESS DEVELOPMENT CENTER PORTABILITY GRANTS.

    Section 21(a)(4)(C)(viii) of the Small Business Act (15 U.S.C. 
648(a)(4)(C)(viii)) is amended--
            (1) in the first sentence, by striking ``as a result of a 
        business or government facility down sizing or closing, which 
        has resulted in the loss of jobs or small business 
        instability'' and inserting ``due to events that have resulted 
        or will result in, business or government facility downsizing 
        or closing''; and
            (2) by adding at the end ``At the discretion of the 
        Administrator, the Administrator may make an award greater than 
        $100,000 to a recipient to accommodate extraordinary 
        occurrences having a catastrophic impact on the small business 
        concerns in a community.''.

SEC. 104. ASSISTANCE TO OUT-OF-STATE BUSINESSES.

    Section 21(b)(3) of the Small Business Act (15 U.S.C. 648(b)(3)) is 
amended--
            (1) by striking ``At the discretion'' and inserting the 
        following: ``Small business development centers.--
                    ``(A) In general.--At the discretion''; and
            (2) by adding at the end the following:
                    ``(B) During disasters.--
                            ``(i) In general.--At the discretion of the 
                        Administrator, the Administrator may authorize 
                        a small business development center to provide 
                        such assistance to small business concerns 
                        located outside of the State, without regard to 
                        geographic proximity, if the small business 
                        concerns are located in a disaster area 
                        declared under section 7(b)(2)(A).
                            ``(ii) 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 such small business development center 
                        otherwise provides services.
                            ``(iii) Access to disaster recovery 
                        facilities.--For purposes of providing disaster 
                        recovery assistance under this subparagraph, 
                        the Administrator shall, to the maximum extent 
                        practicable, permit small business development 
                        center personnel to use any site or facility 
                        designated by the Administrator for use to 
                        provide disaster recovery assistance.''.

SEC. 105. OUTREACH PROGRAMS.

    (a) In General.--Not later than 30 days after the date of the 
declaration of a disaster area, the Administrator may establish a 
contracting outreach and technical assistance program for small 
business concerns which have had a primary place of business in, or 
other significant presence in, such disaster area.
    (b) Administrator Action.--The Administrator may carry out 
subsection (a) by acting through--
            (1) the Administration;
            (2) the Federal agency small business officials designated 
        under section 15(k)(1) of the Small Business Act (15 U.S.C. 
        644(k)(1)); or
            (3) any Federal, State, or local government entity, higher 
        education institution, procurement technical assistance center, 
        or private nonprofit organization that the Administrator may 
        determine appropriate, upon conclusion of a memorandum of 
        understanding or assistance agreement, as appropriate, with the 
        Administrator.

SEC. 106. SMALL BUSINESS BONDING THRESHOLD.

    (a) In General.--Except as provided in subsection (b), and 
notwithstanding any other provision of law, for any procurement related 
to a major disaster, the Administrator may, upon such terms and 
conditions as the Administrator may prescribe, guarantee and enter into 
commitments to guarantee any surety against loss resulting from a 
breach of the terms of a bid bond, payment bond, performance bond, or 
bonds ancillary thereto, by a principal on any total work order or 
contract amount at the time of bond execution that does not exceed 
$5,000,000.
    (b) Increase of Amount.--Upon request of the head of any Federal 
agency other than the Administration involved in reconstruction efforts 
in response to a major disaster, the Administrator may guarantee and 
enter into a commitment to guarantee any security against loss under 
subsection (a) on any total work order or contract amount at the time 
of bond execution that does not exceed $10,000,000.

SEC. 107. TERMINATION OF PROGRAM.

    Section 711(c) of the Small Business Competitive Demonstration 
Program Act of 1988 (15 U.S.C. 644 note) is amended by inserting after 
``January 1, 1989'' the following: ``, and shall terminate on the date 
of enactment of the Small Business Disaster Response and Loan 
Improvements Act of 2007''.

SEC. 108. INCREASING COLLATERAL REQUIREMENTS.

    Section 7(c)(6) of the Small Business Act (15 U.S.C. 636(c)(6)) is 
amended by striking ``$10,000 or less'' and inserting ``$14,000 or less 
(or such higher amount as the Administrator determines appropriate in 
the event of a catastrophic national disaster declared under subsection 
(b)(11))''.

SEC. 109. PUBLIC AWARENESS OF DISASTER DECLARATION AND APPLICATION 
              PERIODS.

    (a) In General.--Section 7(b) of the Small Business Act (15 U.S.C. 
636(b)) is amended by inserting immediately after paragraph (5), as 
added by this Act, the following:
            ``(6) Coordination with fema.--
                    ``(A) In general.--Notwithstanding any other 
                provision of law, for any disaster (including a 
                catastrophic national disaster) declared under this 
                subsection or major disaster, the Administrator, in 
                consultation with the Administrator of the Federal 
                Emergency Management Agency, shall ensure, to the 
                maximum extent practicable, that all application 
                periods for disaster relief under this Act correspond 
                with application deadlines established under the Robert 
                T. Stafford Disaster Relief and Emergency Assistance 
                Act (42 U.S.C. 5121 et seq.), or as extended by the 
                President.
                    ``(B) Deadlines.--Notwithstanding any other 
                provision of law, not later than 10 days before the 
                closing date of an application period for a major 
                disaster (including a catastrophic national disaster), 
                the Administrator, in consultation with the 
                Administrator of the Federal Emergency Management 
                Agency, 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 
                that includes--
                            ``(i) the deadline for submitting 
                        applications for assistance under this Act 
                        relating to that major disaster;
                            ``(ii) information regarding the number of 
                        loan applications and disbursements processed 
                        by the Administrator relating to that major 
                        disaster for each day during the period 
                        beginning on the date on which that major 
                        disaster was declared and ending on the date of 
                        that report; and
                            ``(iii) an estimate of the number of 
                        potential applicants that have not submitted an 
                        application relating to that major disaster.
            ``(7) Public awareness of disasters.--If a disaster 
        (including a catastrophic national disaster) is declared under 
        this subsection, the Administrator shall make every effort to 
        communicate through radio, television, print, and web-based 
        outlets, all relevant information needed by disaster loan 
        applicants, including--
                    ``(A) the date of such declaration;
                    ``(B) cities and towns within the area of such 
                declaration;
                    ``(C) loan application deadlines related to such 
                disaster;
                    ``(D) all relevant contact information for victim 
                services available through the Administration 
                (including links to small business development center 
                websites);
                    ``(E) links to relevant Federal and State disaster 
                assistance websites, including links to websites 
                providing information regarding assistance available 
                from the Federal Emergency Management Agency;
                    ``(F) information on eligibility criteria for 
                Administration loan programs, including where such 
                applications can be found; and
                    ``(G) application materials that clearly state the 
                function of the Administration as the Federal source of 
                disaster loans for homeowners and renters.''.
    (b) Marketing and Outreach.--Not later than 90 days after the date 
of enactment of this Act, the Administrator shall create a marketing 
and outreach plan that--
            (1) encourages a proactive approach to the disaster relief 
        efforts of the Administration;
            (2) makes clear the services provided by the 
        Administration, including contact information, application 
        information, and timelines for submitting applications, the 
        review of applications, and the disbursement of funds;
            (3) describes the different disaster loan programs of the 
        Administration, including how they are made available and the 
        eligibility requirements for each loan program;
            (4) provides for regional marketing, focusing on disasters 
        occurring in each region before the date of enactment of this 
        Act, and likely scenarios for disasters in each such region; 
        and
            (5) ensures that the marketing plan is made available at 
        small business development centers and on the website of the 
        Administration.

SEC. 110. CONSISTENCY BETWEEN ADMINISTRATION REGULATIONS AND STANDARD 
              OPERATING PROCEDURES.

    (a) In General.--The Administrator shall, promptly following the 
date of enactment of this Act, conduct a study of whether the standard 
operating procedures of the Administration for loans offered under 
section 7(b) of the Small Business Act (15 U.S.C. 636(b)) are 
consistent with the regulations of the Administration for administering 
the disaster loan program.
    (b) Report.--Not later than 180 days after the date of enactment of 
this Act, the Administration shall submit to Congress a report 
containing all findings and recommendations of the study conducted 
under subsection (a).

SEC. 111. PROCESSING DISASTER LOANS.

    (a) Authority for Qualified Private Contractors To Process Disaster 
Loans.--Section 7(b) of the Small Business Act (15 U.S.C. 636(b)) is 
amended by inserting immediately after paragraph (7), as added by this 
Act, the following:
            ``(8) Authority for qualified private contractors.--
                    ``(A) Disaster loan processing.--The Administrator 
                may enter into an agreement with a qualified private 
                contractor, as determined by the Administrator, to 
                process loans under this subsection in the event of a 
                major disaster or a catastrophic national disaster 
                declared under paragraph (11), under which the 
                Administrator shall pay the contractor a fee for each 
                loan processed.
                    ``(B) Loan loss verification services.--The 
                Administrator may enter into an agreement with a 
                qualified lender or loss verification professional, as 
                determined by the Administrator, to verify losses for 
                loans under this subsection in the event of a major 
                disaster or a catastrophic national disaster declared 
                under paragraph (11), under which the Administrator 
                shall pay the lender or verification professional a fee 
                for each loan for which such lender or verification 
                professional verifies losses.''.
    (b) Coordination of Efforts Between the Administrator and the 
Internal Revenue Service To Expedite Loan Processing.--The 
Administrator and the Commissioner of Internal Revenue shall, to the 
maximum extent practicable, ensure that all relevant and allowable tax 
records for loan approval are shared with loan processors in an 
expedited manner, upon request by the Administrator.

SEC. 112. DEVELOPMENT AND IMPLEMENTATION OF MAJOR DISASTER RESPONSE 
              PLAN.

    (a) In General.--Not later than 3 months after the date of 
enactment of this Act, the Administrator shall--
            (1) by rule, amend the 2006 Atlantic hurricane season 
        disaster response plan of the Administration (in this section 
        referred to as the ``disaster response plan'') to apply to 
        major disasters; and
            (2) submit a report to the Committee on Small Business and 
        Entrepreneurship of the Senate and the Committee on Small 
        Business of the House of Representatives detailing the 
        amendments to the disaster response plan.
    (b) Contents.--The report required under subsection (a)(2) shall 
include--
            (1) any updates or modifications made to the disaster 
        response plan since the report regarding the disaster response 
        plan submitted to Congress on July 14, 2006;
            (2) a description of how the Administrator plans to utilize 
        and integrate District Office personnel of the Administration 
        in the response to a major disaster, including information on 
        the utilization of personnel for loan processing and loan 
        disbursement;
            (3) a description of the disaster scalability model of the 
        Administration and on what basis or function the plan is 
        scaled;
            (4) a description of how the agency-wide Disaster Oversight 
        Council is structured, which offices comprise its membership, 
        and whether the Associate Deputy Administrator for 
        Entrepreneurial Development of the Administration is a member;
            (5) a description of how the Administrator plans to 
        coordinate the disaster efforts of the Administration with 
        State and local government officials, including recommendations 
        on how to better incorporate State initiatives or programs, 
        such as State-administered bridge loan programs, into the 
        disaster response of the Administration;
            (6) recommendations, if any, on how the Administration can 
        better coordinate its disaster response operations with the 
        operations of other Federal, State, and local entities;
            (7) any surge plan for the disaster loan program of the 
        Administration in effect on or after August 29, 2005 (including 
        surge plans for loss verification, loan processing, mailroom, 
        customer service or call center operations, and a continuity of 
        operations plan);
            (8) the number of full-time equivalent employees and job 
        descriptions for the planning and disaster response staff of 
        the Administration;
            (9) the in-service and preservice training procedures for 
        disaster response staff of the Administration;
            (10) information on the logistical support plans of the 
        Administration (including equipment and staffing needs, and 
        detailed information on how such plans will be scalable 
        depending on the size and scope of the major disaster;
            (11) a description of the findings and recommendations of 
        the Administrator, if any, based on a review of the response of 
        the Administration to Hurricane Katrina of 2005, Hurricane Rita 
        of 2005, and Hurricane Wilma of 2005; and
            (12) a plan for how the Administrator, in consultation with 
        the Administrator of the Federal Emergency Management Agency, 
        will coordinate the provision of accommodations and necessary 
        resources for disaster assistance personnel to effectively 
        perform their responsibilities in the aftermath of a major 
        disaster.
    (c) Exercises.--Not later than 6 months after the date of the 
submission of the report under subsection (a)(2), the Administrator 
shall develop and execute simulation exercises to demonstrate the 
effectiveness of the amended disaster response plan required under this 
section.

SEC. 113. DISASTER PLANNING RESPONSIBILITIES.

    (a) Assignment of Small Business Administration Disaster Planning 
Responsibilities.--The Administrator shall specifically assign the 
disaster planning responsibilities described in subsection (b) to an 
employee of the Administration who--
            (1) is not an employee of the Office of Disaster Assistance 
        of the Administration;
            (2) shall report directly to the Administrator; and
            (3) has a background and expertise demonstrating 
        significant experience in the area of disaster planning.
    (b) Responsibilities.--The responsibilities described in this 
subsection are--
            (1) creating and maintaining the comprehensive disaster 
        response plan of the Administration;
            (2) ensuring in-service and pre-service training procedures 
        for the disaster response staff of the Administration;
            (3) coordinating and directing Administration training 
        exercises, including mock disaster responses, with other 
        Federal agencies; and
            (4) other responsibilities, as determined by the 
        Administrator.
    (c) Report.--Not later than 30 days after the date of enactment of 
this Act, 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 containing--
            (1) a description of the actions of the Administrator to 
        assign an employee under subsection (a);
            (2) information detailing the background and expertise of 
        the employee assigned under subsection (a); and
            (3) information on the status of the implementation of the 
        responsibilities described in subsection (b).

SEC. 114. ADDITIONAL AUTHORITY FOR DISTRICT OFFICES OF THE 
              ADMINISTRATION.

    (a) In General.--Section 7(b) of the Small Business Act (15 U.S.C. 
636(b)) is amended by inserting immediately after paragraph (8), as 
added by this Act, the following:
            ``(9) Use of district offices.--In the event of a major 
        disaster, the Administrator may authorize a district office of 
        the Administration to process loans under paragraph (1) or 
        (2).''.
    (b) Designation.--
            (1) In general.--The Administrator may designate an 
        employee in each district office of the Administration to act 
        as a disaster loan liaison between the disaster processing 
        center and applicants under the disaster loan program of the 
        Administration.
            (2) Responsibilities.--Each employee designated under 
        paragraph (1) shall--
                    (A) be responsible for coordinating and 
                facilitating communications between applicants under 
                the disaster loan program of the Administration and 
                disaster loan processing staff regarding documentation 
                and information required for completion of an 
                application; and
                    (B) provide information to applicants under the 
                disaster loan program of the Administration regarding 
                additional services and benefits that may be available 
                to such applicants to assist with recovery.
            (3) Outreach.--In providing outreach to disaster victims 
        following a declared disaster, the Administrator shall make 
        disaster victims aware of--
                    (A) any relevant employee designated under 
                paragraph (1); and
                    (B) how to contact that employee.

SEC. 115. ASSIGNMENT OF EMPLOYEES OF THE OFFICE OF DISASTER ASSISTANCE 
              AND DISASTER CADRE.

    (a) In General.--Section 7(b) of the Small Business Act (15 U.S.C. 
636(b)) is amended by inserting immediately after paragraph (9), as 
added by this Act, the following:
            ``(10) Disaster assistance employees.--
                    ``(A) In general.--In carrying out this section, 
                the Administrator may, where practicable, ensure that 
                the number of full-time equivalent employees--
                            ``(i) in the Office of the Disaster 
                        Assistance is not fewer than 800; and
                            ``(ii) in the Disaster Cadre of the 
                        Administration is not fewer than 750.
                    ``(B) Report.--In carrying out this subsection, if 
                the number of full-time employees for either the Office 
                of Disaster Assistance or the Disaster Cadre of the 
                Administration is below the level described in 
                subparagraph (A) for that office, not later than 21 
                days after the date on which that staffing level 
                decreased below the level described in subparagraph 
                (A), the Administrator shall submit to the Committee on 
                Appropriations and the Committee on Small Business and 
                Entrepreneurship of the Senate and the Committee on 
                Appropriations and Committee on Small Business of the 
                House of Representatives, a report--
                            ``(i) detailing staffing levels on that 
                        date;
                            ``(ii) requesting, if practicable and 
                        determined appropriate by the Administrator, 
                        additional funds for additional employees; and
                            ``(iii) containing such additional 
                        information, as determined appropriate by the 
                        Administrator.''.

                       TITLE II--DISASTER LENDING

SEC. 201. CATASTROPHIC NATIONAL DISASTER DECLARATION.

    Section 7(b) of the Small Business Act (15 U.S.C. 636(b)) is 
amended by inserting immediately after paragraph (10), as added by this 
Act, the following:
            ``(11) Catastrophic national disasters.--
                    ``(A) In general.--The President may make a 
                catastrophic national disaster declaration in 
                accordance with this paragraph.
                    ``(B) Promulgation of rules.--
                            ``(i) In general.--Not later than 6 months 
                        after the date of enactment of this paragraph, 
                        the Administrator, with the concurrence of the 
                        Secretary of Homeland Security and the 
                        Administrator of the Federal Emergency 
                        Management Agency, shall promulgate regulations 
                        establishing a threshold for a catastrophic 
                        national disaster declaration.
                            ``(ii) Considerations.--In promulgating the 
                        regulations required under clause (i), the 
                        Administrator shall establish a threshold 
                        that--
                                    ``(I) is similar in size and scope 
                                to the events relating to the terrorist 
                                attacks of September 11, 2001, and 
                                Hurricane Katrina of 2005;
                                    ``(II) requires that the President 
                                declares a major disaster before making 
                                a catastrophic national disaster 
                                declaration under this paragraph;
                                    ``(III) requires consideration of--
                                            ``(aa) the dollar amount 
                                        per capita of damage to the 
                                        State, its political 
                                        subdivisions, or a region;
                                            ``(bb) the number of small 
                                        business concerns damaged, 
                                        physically or economically, as 
                                        a direct result of the event;
                                            ``(cc) the number of 
                                        individuals and households 
                                        displaced from their 
                                        predisaster residences by the 
                                        event;
                                            ``(dd) the severity of the 
                                        impact on employment rates in 
                                        the State, its political 
                                        subdivisions, or a region;
                                            ``(ee) the anticipated 
                                        length and difficulty of the 
                                        recovery process;
                                            ``(ff) whether the events 
                                        leading to the relevant major 
                                        disaster declaration are of an 
                                        unusually large and calamitous 
                                        nature that is orders of 
                                        magnitude larger than for an 
                                        average major disaster; and
                                            ``(gg) any other factor 
                                        determined relevant by the 
                                        Administrator.
                    ``(C) Authorization.--If the President makes a 
                catastrophic national disaster declaration under this 
                paragraph, the Administrator may make such loans under 
                this paragraph (either directly or in cooperation with 
                banks or other lending institutions through agreements 
                to participate on an immediate or deferred basis) as 
                the Administrator determines appropriate to small 
                business concerns located anywhere in the United States 
                that are economically adversely impacted as a result of 
                that catastrophic national disaster.
                    ``(D) Loan terms.--A loan under this paragraph 
                shall be made on the same terms as a loan under 
                paragraph (2).''.

SEC. 202. PRIVATE DISASTER LOANS.

    (a) In General.--Section 7 of the Small Business Act (15 U.S.C. 
636) is amended--
            (1) by redesignating subsections (c) and (d) as subsections 
        (d) and (e), respectively; and
            (2) by inserting after subsection (b) the following:
    ``(c) Private Disaster Loans.--
            ``(1) Definitions.--In this subsection--
                    ``(A) the term `disaster area' means any area for 
                which the President declared a major disaster (as that 
                term is defined in section 102 of the Robert T. 
                Stafford Disaster Relief and Emergency Assistance Act 
                (42 U.S.C. 5122)) that subsequently results in the 
                President making a catastrophic national disaster 
                declaration under subsection (b)(11);
                    ``(B) the term `eligible small business concern' 
                means a business concern that is--
                            ``(i) a small business concern, as defined 
                        in this Act; or
                            ``(ii) a small business concern, as defined 
                        in section 103 of the Small Business Investment 
                        Act of 1958; and
                    ``(C) the term `qualified private lender' means any 
                privately-owned bank or other lending institution that 
                the Administrator determines meets the criteria 
                established under paragraph (9).
            ``(2) Authorization.--The Administrator may guarantee 
        timely payment of principal and interest, as scheduled on any 
        loan issued by a qualified private lender to an eligible small 
        business concern located in a disaster area.
            ``(3) Use of loans.--A loan guaranteed by the Administrator 
        under this subsection may be used for any purpose authorized 
        under subsection (b).
            ``(4) Online applications.--
                    ``(A) Establishment.--The Administrator may 
                establish, directly or through an agreement with 
                another entity, an online application process for loans 
                guaranteed under this subsection.
                    ``(B) Other federal assistance.--The Administrator 
                may coordinate with the head of any other appropriate 
                Federal agency so that any application submitted 
                through an online application process established under 
                this paragraph may be considered for any other Federal 
                assistance program for disaster relief.
                    ``(C) Consultation.--In establishing an online 
                application process under this paragraph, the 
                Administrator shall consult with appropriate persons 
                from the public and private sectors, including private 
                lenders.
            ``(5) Maximum amounts.--
                    ``(A) Guarantee percentage.--The Administrator may 
                guarantee not more than 85 percent of a loan under this 
                subsection.
                    ``(B) Loan amounts.--The maximum amount of a loan 
                guaranteed under this subsection shall be $2,000,000.
            ``(6) Loan term.--The longest term of a loan for a loan 
        guaranteed under this subsection shall be--
                    ``(A) 15 years for any loan that is issued without 
                collateral; and
                    ``(B) 25 years for any loan that is issued with 
                collateral.
            ``(7) Fees.--
                    ``(A) In general.--The Administrator may not 
                collect a guarantee fee under this subsection.
                    ``(B) Origination fee.--The Administrator may pay a 
                qualified private lender an origination fee for a loan 
                guaranteed under this subsection in an amount agreed 
                upon in advance between the qualified private lender 
                and the Administrator.
            ``(8) Documentation.--A qualified private lender may use 
        its own loan documentation for a loan guaranteed by the 
        Administrator, to the extent authorized by the Administrator. 
        The ability of a lender to use its own loan documentation for a 
        loan guaranteed under this subsection shall not be considered 
        part of the criteria for becoming a qualified private lender 
        under the regulations promulgated under paragraph (9).
            ``(9) Implementation regulations.--
                    ``(A) In general.--Not later than 1 year after the 
                date of enactment of the Small Business Disaster 
                Response and Loan Improvements Act of 2007, the 
                Administrator shall issue final regulations 
                establishing permanent criteria for qualified private 
                lenders.
                    ``(B) Report to congress.--Not later than 6 months 
                after the date of enactment of the Small Business 
                Disaster Response and Loan Improvements Act of 2007, 
                the Administrator shall submit a report on the progress 
                of the regulations required by subparagraph (A) to the 
                Committee on Small Business and Entrepreneurship of the 
                Senate and the Committee on Small Business of the House 
                of Representatives.
            ``(10) Authorization of appropriations.--
                    ``(A) In general.--Amounts necessary to carry out 
                this subsection shall be made available from amounts 
                appropriated to the Administration to carry out 
                subsection (b).
                    ``(B) Authority to reduce interest rates.--Funds 
                appropriated to the Administration to carry out this 
                subsection, may be used by the Administrator, to the 
                extent available, to reduce the rate of interest for 
                any loan guaranteed under this subsection by not more 
                than 3 percentage points.
            ``(11) Purchase of loans.--The Administrator may enter into 
        an agreement with a qualified private lender to purchase any 
        loan issued under this subsection.''.
    (b) Effective Date.--The amendments made by this section shall 
apply to disasters declared under section 7(b)(2) of the Small Business 
Act (631 U.S.C. 636(b)(2)) before, on, or after the date of enactment 
of this Act.

SEC. 203. TECHNICAL AND CONFORMING AMENDMENTS.

    The Small Business Act (15 U.S.C. 631 et seq.) is amended--
            (1) in section 4(c)--
                    (A) in paragraph (1), by striking ``7(c)(2)'' and 
                inserting ``7(d)(2)''; and
                    (B) in paragraph (2)--
                            (i) by striking ``7(c)(2)'' and inserting 
                        ``7(d)(2)''; and
                            (ii) by striking ``7(e),''; and
            (2) in section 7(b), in the undesignated matter following 
        paragraph (3)--
                    (A) by striking ``That the provisions of paragraph 
                (1) of subsection (c)'' and inserting ``That the 
                provisions of paragraph (1) of subsection (d)''; and
                    (B) by striking ``Notwithstanding the provisions of 
                any other law the interest rate on the Administration's 
                share of any loan made under subsection (b) except as 
                provided in subsection (c),'' and inserting 
                ``Notwithstanding any other provision of law, and 
                except as provided in subsection (d), the interest rate 
                on the Administration's share of any loan made under 
                subsection (b)''.

SEC. 204. EXPEDITED DISASTER ASSISTANCE LOAN PROGRAM.

    (a) Definitions.--In this section--
            (1) the term ``immediate disaster assistance'' means 
        assistance provided during the period beginning on the date on 
        which the President makes a catastrophic disaster declaration 
        under paragraph (11) of section 7(b) of the Small Business Act 
        (15 U.S.C. 636(b)), as added by this Act, and ending on the 
        date that an impacted small business concern is able to secure 
        funding through insurance claims, Federal assistance programs, 
        or other sources; and
            (2) the term ``program'' means the expedited disaster 
        assistance business loan program established under subsection 
        (b).
    (b) Creation of Program.--The Administrator shall take such 
administrative action as is necessary to establish and implement an 
expedited disaster assistance business loan program to provide small 
business concerns with immediate disaster assistance under paragraph 
(11) of section 7(b) of the Small Business Act (15 U.S.C. 636(b)), as 
added by this Act.
    (c) Consultation Required.--In establishing the program, the 
Administrator shall consult with--
            (1) appropriate personnel of the Administration (including 
        District Office personnel of the Administration);
            (2) appropriate technical assistance providers (including 
        small business development centers);
            (3) appropriate lenders and credit unions;
            (4) the Committee on Small Business and Entrepreneurship of 
        the Senate; and
            (5) the Committee on Small Business of the House of 
        Representatives.
    (d) Rules.--
            (1) In general.--Not later than 1 year after the date of 
        enactment of this Act, the Administrator shall issue rules in 
        final form establishing and implementing the program in 
        accordance with this section. Such rules shall apply as 
        provided for in this section, beginning 90 days after their 
        issuance in final form.
            (2) Contents.--The rules promulgated under paragraph (1) 
        shall--
                    (A) identify whether appropriate uses of funds 
                under the program may include--
                            (i) paying employees;
                            (ii) paying bills and other financial 
                        obligations;
                            (iii) making repairs;
                            (iv) purchasing inventory;
                            (v) restarting or operating a small 
                        business concern in the community in which it 
                        was conducting operations prior to the declared 
                        disaster, or to a neighboring area, county, or 
                        parish in the disaster area; or
                            (vi) covering additional costs until the 
                        small business concern is able to obtain 
                        funding through insurance claims, Federal 
                        assistance programs, or other sources; and
                    (B) set the terms and conditions of any loan made 
                under the program, subject to paragraph (3).
            (3) Terms and conditions.--A loan made by the 
        Administration under this section--
                    (A) shall be for not more than $150,000;
                    (B) shall be a short-term loan, not to exceed 180 
                days, except that the Administrator may extend such 
                term as the Administrator determines necessary or 
                appropriate on a case-by-case basis;
                    (C) shall have an interest rate not to exceed 1 
                percentage point above the prime rate of interest that 
                a private lender may charge;
                    (D) shall have no prepayment penalty;
                    (E) may only be made to a borrower that meets the 
                requirements for a loan under section 7(b) of the Small 
                Business Act (15 U.S.C. 636(b));
                    (F) may be refinanced as part of any subsequent 
                disaster assistance provided under section 7(b) of the 
                Small Business Act;
                    (G) may receive expedited loss verification and 
                loan processing, if the applicant is--
                            (i) a major source of employment in the 
                        disaster area (which shall be determined in the 
                        same manner as under section 7(b)(3)(B) of the 
                        Small Business Act (15 U.S.C. 636(b)(3)(B))); 
                        or
                            (ii) vital to recovery efforts in the 
                        region (including providing debris removal 
                        services, manufactured housing, or building 
                        materials); and
                    (H) shall be subject to such additional terms as 
                the Administrator determines necessary or appropriate.
    (e) Report to Congress.--Not later than 5 months after the date of 
enactment of this Act, the Administrator shall report to the Committee 
on Small Business and Entrepreneurship of the Senate and the Committee 
on Small Business of the House of Representatives on the progress of 
the Administrator in establishing the program.
    (f) Authorization.--There are authorized to be appropriated to the 
Administrator such sums as are necessary to carry out this section.

SEC. 205. HUBZONES.

    (a) In General.--Section 3(p) of the Small Business Act (15 U.S.C. 
632(p)) is amended--
            (1) in paragraph (1)--
                    (A) in subparagraph (D), by striking ``or'';
                    (B) in subparagraph (E), by striking the period at 
                the end and inserting a semicolon; and
                    (C) by adding at the end the following:
                    ``(F) areas in which the President has declared a 
                major disaster (as that term is defined in section 102 
                of the Robert T. Stafford Disaster Relief and Emergency 
                Assistance Act (42 U.S.C. 5122)) as a result of 
                Hurricane Katrina of August 2005 or Hurricane Rita of 
                September 2005, during the time period described in 
                paragraph (8); or
                    ``(G) catastrophic national disaster areas.'';
            (2) in paragraph (4), by adding at the end the following:
                    ``(E) Catastrophic national disaster area.--
                            ``(i) In general.--The term `catastrophic 
                        national disaster area' means an area--
                                    ``(I) affected by a catastrophic 
                                national disaster declared under 
                                section 7(b)(11), during the time 
                                period described in clause (ii); and
                                    ``(II) for which the Administrator 
                                determines that designation as a 
                                HUBZone would substantially contribute 
                                to the reconstruction and recovery 
                                effort in that area.
                            ``(ii) Time period.--The time period for 
                        the purposes of clause (i)--
                                    ``(I) shall be the 2-year period 
                                beginning on the date that the 
                                applicable catastrophic national 
                                disaster was declared under section 
                                7(b)(11); and
                                    ``(II) may, at the discretion of 
                                the Administrator, be extended to be 
                                the 3-year period beginning on the date 
                                described in subclause (I).''; and
            (3) by adding at the end the following:
            ``(8) Time period.--The time period for the purposes of 
        paragraph (1)(F)--
                    ``(A) shall be the 2-year period beginning on the 
                later of the date of enactment of this paragraph and 
                August 29, 2007; and
                    ``(B) may, at the discretion of the Administrator, 
                be extended to be the 3-year period beginning on the 
                later of the date of enactment of this paragraph and 
                August 29, 2007.''.
    (b) Tolling of Graduation.--Section 7(j)(10)(C) of the Small 
Business Act (15 U.S.C. 636(j)(10)(C)) is amended by adding at the end 
the following:
                    ``(iii)(I) For purposes of this subparagraph, if 
                the Administrator designates an area as a HUBZone under 
                section 3(p)(4)(E)(i)(II), the Administrator shall not 
                count the time period described in subclause (II) of 
                this clause for any small business concern--
                            ``(aa) that is participating in any 
                        program, activity, or contract under section 
                        8(a); and
                            ``(bb) the principal place of business of 
                        which is located in that area.
                    ``(II) The time period for purposes of subclause 
                (I)--
                            ``(aa) shall be the 2-year period beginning 
                        on the date that the applicable catastrophic 
                        national disaster was declared under section 
                        7(b)(11); and
                            ``(bb) may, at the discretion of the 
                        Administrator, be extended to be the 3-year 
                        period beginning on the date described in item 
                        (aa).''.
    (c) Study of HUBZone Disaster Areas.--Not later than 1 year after 
the date of enactment of this Act, the Comptroller General of the 
United States shall submit a report to the Committee on Small Business 
and Entrepreneurship of the Senate and the Committee on Small Business 
of the House of Representatives evaluating the designation by the 
Administrator of catastrophic national disaster areas, as that term is 
defined in section 3(p)(4)(E) of the Small Business Act (as added by 
this Act), as HUBZones.

                TITLE III--DISASTER ASSISTANCE OVERSIGHT

SEC. 301. CONGRESSIONAL OVERSIGHT.

    (a) Monthly Accounting Report to Congress.--
            (1) Reporting requirements.--Not later than the fifth 
        business day of each month during the applicable period for a 
        major disaster, the Administrator shall provide to the 
        Committee on Small Business and Entrepreneurship and the 
        Committee on Appropriations of the Senate and to the Committee 
        on Small Business and the Committee on Appropriations of the 
        House of Representatives a report on the operation of the 
        disaster loan program authorized under section 7 of the Small 
        Business Act (15 U.S.C. 636) for that major disaster during the 
        preceding month.
            (2) Contents.--Each report under paragraph (1) shall 
        include--
                    (A) the daily average lending volume, in number of 
                loans and dollars, and the percent by which each 
                category has increased or decreased since the previous 
                report under paragraph (1);
                    (B) the weekly average lending volume, in number of 
                loans and dollars, and the percent by which each 
                category has increased or decreased since the previous 
                report under paragraph (1);
                    (C) the amount of funding spent over the month for 
                loans, both in appropriations and program level, and 
                the percent by which each category has increased or 
                decreased since the previous report under paragraph 
                (1);
                    (D) the amount of funding available for loans, both 
                in appropriations and program level, and the percent by 
                which each category has increased or decreased since 
                the previous report under paragraph (1), noting the 
                source of any additional funding;
                    (E) an estimate of how long the available funding 
                for such loans will last, based on the spending rate;
                    (F) the amount of funding spent over the month for 
                staff, along with the number of staff, and the percent 
                by which each category has increased or decreased since 
                the previous report under paragraph (1);
                    (G) the amount of funding spent over the month for 
                administrative costs, and the percent by which such 
                spending has increased or decreased since the previous 
                report under paragraph (1);
                    (H) the amount of funding available for salaries 
                and expenses combined, and the percent by which such 
                funding has increased or decreased since the previous 
                report under paragraph (1), noting the source of any 
                additional funding; and
                    (I) an estimate of how long the available funding 
                for salaries and expenses will last, based on the 
                spending rate.
    (b) Daily Disaster Updates to Congress for Presidentially Declared 
Disasters.--
            (1) In general.--Each day during a disaster update period, 
        excluding Federal holidays and weekends, the Administration 
        shall provide to the Committee on Small Business and 
        Entrepreneurship of the Senate and to the Committee on Small 
        Business of the House of Representatives a report on the 
        operation of the disaster loan program of the Administration 
        for the area in which the President declared a major disaster.
            (2) Contents.--Each report under paragraph (1) shall 
        include--
                    (A) the number of Administration staff performing 
                loan processing, field inspection, and other duties for 
                the declared disaster, and the allocations of such 
                staff in the disaster field offices, disaster recovery 
                centers, workshops, and other Administration offices 
                nationwide;
                    (B) the daily number of applications received from 
                applicants in the relevant area, as well as a breakdown 
                of such figures by State;
                    (C) the daily number of applications pending 
                application entry from applicants in the relevant area, 
                as well as a breakdown of such figures by State;
                    (D) the daily number of applications withdrawn by 
                applicants in the relevant area, as well as a breakdown 
                of such figures by State;
                    (E) the daily number of applications summarily 
                declined by the Administration from applicants in the 
                relevant area, as well as a breakdown of such figures 
                by State;
                    (F) the daily number of applications declined by 
                the Administration from applicants in the relevant 
                area, as well as a breakdown of such figures by State;
                    (G) the daily number of applications in process 
                from applicants in the relevant area, as well as a 
                breakdown of such figures by State;
                    (H) the daily number of applications approved by 
                the Administration from applicants in the relevant 
                area, as well as a breakdown of such figures by State;
                    (I) the daily dollar amount of applications 
                approved by the Administration from applicants in the 
                relevant area, as well as a breakdown of such figures 
                by State;
                    (J) the daily amount of loans dispersed, both 
                partially and fully, by the Administration to 
                applicants in the relevant area, as well as a breakdown 
                of such figures by State;
                    (K) the daily dollar amount of loans disbursed, 
                both partially and fully, from the relevant area, as 
                well as a breakdown of such figures by State;
                    (L) the number of applications approved, including 
                dollar amount approved, as well as applications 
                partially and fully disbursed, including dollar 
                amounts, since the last report under paragraph (1); and
                    (M) the declaration date, physical damage closing 
                date, economic injury closing date, and number of 
                counties included in the declaration of a major 
                disaster.
    (c) Notice of the Need for Supplemental Funds.--On the same date 
that the Administrator notifies any committee of the Senate or the 
House of Representatives that supplemental funding is necessary for the 
disaster loan program of the Administration in any fiscal year, the 
Administrator shall notify in writing the Committee on Small Business 
and Entrepreneurship of the Senate and the Committee on Small Business 
of the House of Representatives regarding the need for supplemental 
funds for that loan program.
    (d) Report on Contracting.--
            (1) In general.--Not later than 6 months after the date on 
        which the President declares a major disaster, and every 6 
        months thereafter until the date that is 18 months after the 
        date on which the major disaster was declared, the 
        Administrator shall submit a report to the Committee on Small 
        Business and Entrepreneurship of the Senate and to the 
        Committee on Small Business of the House of Representatives 
        regarding Federal contracts awarded as a result of that major 
        disaster.
            (2) Contents.--Each report submitted under paragraph (1) 
        shall include--
                    (A) the total number of contracts awarded as a 
                result of that major disaster;
                    (B) the total number of contracts awarded to small 
                business concerns as a result of that major disaster;
                    (C) the total number of contracts awarded to women 
                and minority-owned businesses as a result of that major 
                disaster; and
                    (D) the total number of contracts awarded to local 
                businesses as a result of that major disaster.
    (e) Report on Loan Approval Rate.--
            (1) In general.--Not later than 6 months after the date of 
        enactment of this Act, the Administrator shall submit a report 
        to the Committee on Small Business and Entrepreneurship of the 
        Senate and the Committee on Small Business of the House of 
        Representatives detailing how the Administration can improve 
        the processing of applications under the disaster loan program 
        of the Administration.
            (2) Contents.--The report submitted under paragraph (1) 
        shall include--
                    (A) recommendations, if any, regarding--
                            (i) staffing levels during a major 
                        disaster;
                            (ii) how to improve the process for 
                        processing, approving, and disbursing loans 
                        under the disaster loan program of the 
                        Administration, to ensure that the maximum 
                        assistance is provided to victims in a timely 
                        manner;
                            (iii) the viability of using alternative 
                        methods for assessing the ability of an 
                        applicant to repay a loan, including the credit 
                        score of the applicant on the day before the 
                        date on which the disaster for which the 
                        applicant is seeking assistance was declared;
                            (iv) methods, if any, for the 
                        Administration to expedite loss verification 
                        and loan processing of disaster loans during a 
                        major disaster for businesses affected by, and 
                        located in the area for which the President 
                        declared, the major disaster that are a major 
                        source of employment in the area or are vital 
                        to recovery efforts in the region (including 
                        providing debris removal services, manufactured 
                        housing, or building materials);
                            (v) legislative changes, if any, needed to 
                        implement findings from the Accelerated 
                        Disaster Response Initiative of the 
                        Administration; and
                            (vi) a description of how the 
                        Administration plans to integrate and 
                        coordinate the response to a major disaster 
                        with the technical assistance programs of the 
                        Administration; and
                    (B) the plans of the Administrator for implementing 
                any recommendation made under subparagraph (A).

            Passed the Senate August 3, 2007.

            Attest:

                                                             Secretary.
110th CONGRESS

  1st Session

                                 S. 163

_______________________________________________________________________

                                 AN ACT

      To improve the disaster loan program of the Small Business 
                Administration, and for other purposes.
```