II 

108TH CONGRESS 

2D SESSION S. 2186

To temporarily extend the programs under the Small Business Act and 

the Small Business Investment Act of 1958, through May 15, 2004, 

and for other purposes. 

IN THE SENATE OF THE UNITED STATES 

MARCH 9, 2004

Mr. DASCHLE for Mr. KERRY (for himself) introduced the following bill; which 

was read twice and referred to the Committee on Small Business and Entrepreneurship 

A BILL

To temporarily extend the programs under the Small Business Act and the Small Business Investment Act of 

1958, through May 15, 2004, and for other purposes.

1 Be it enacted by the Senate and House of Representa2 tives of the United States of America in Congress assembled,

3 SECTION 1. SHORT TITLE. 

4 This Act may be cited as the ‘‘SBA Emergency Au5 thorization Extension Act of 2004’’. 

6 SEC. 2. SBA PROGRAM AUTHORIZATIONS. 

7 (a) IN GENERAL.—Section 1 of Public Law 108–172 

8 (117 Stat. 2065) is amended— 
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1 (1) in subsection (a), by striking ‘‘March 15’’ 

2 each place that term appears and inserting ‘‘May 

3 15’’; and 

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

5 ‘‘(c) EXCEPTION FOR OTHER PROGRAMS.—Notwith6 standing subsection (a), title V of the Small Business In7 vestment Act of 1958 (15 U.S.C. 661 et seq.) and section 

8 29 of the Small Business Act (15 U.S.C. 656), including 

9 any pilot program, shall remain authorized through Sep10 tember 30, 2004.’’. 

11 (b) CONFORMING AMENDMENT.—Section 503(f) of 

12 the Small Business Investment Act of 1958 (15 U.S.C. 

13 697(f)) is amended by striking ‘‘October 1, 2003’’ and in14 serting ‘‘October 1, 2004’’. 

15 SEC. 3. WOMEN’S BUSINESS CENTERS. 

16 (a) IN GENERAL.—Section 29(k) of the Small Busi17 ness Act (15 U.S.C. 656(k)) is amended— 

18 (1) in paragraph (2), by adding at the end the 

19 following: 

20 ‘‘(C) FUNDING PRIORITY.—Subject to 

21 available funds, and reservation of funds, the 

22 Administration shall, for each fiscal year, allo23 cate— 

24 ‘‘(i) $150,000 for each women’s busi25 ness center established under subsection 
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1 (b), except for any center that requests a 

2 lesser amount; 

3 ‘‘(ii) from the remaining funds, not 

4 more than $125,000, in equal amounts, to 

5 each women’s business center established 

6 under subsection (l), to the extent such 

7 funds are reserved under subsection 

8 (k)(4)(A), except for any center that re9 quests a lesser amount; and 

10 ‘‘(iii) any funds remaining after allo11 cations are made under clauses (i) and (ii) 

12 to new eligible women’s business centers 

13 and eligible women’s business centers that 

14 did not receive funding in the prior fiscal 

15 year under subsection (b).’’; and 

16 (2) in paragraph (4)(A), by adding at the end 

17 the following: 

18 ‘‘(v) For fiscal year 2004, 48 per19 cent.’’. 

20 (b) SUNSET DATE.—The amendments made by this 

21 section are repealed on October 1, 2004. 

22 SEC. 4. 7(a) LOAN GUARANTEE PROGRAM. 

23 (a) COMBINATION LOANS.— 
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1 (1) IN GENERAL.—Section 7(a) of the Small 

2 Business Act (15 U.S.C. 636(a)) is amended by add3 ing at the end the following: 

4 ‘‘(31) COMBINATION LOANS.— 

5 ‘‘(A) DEFINED TERM.—As used in this 

6 paragraph, the term ‘combination loan’ means a 

7 financing comprised of a loan guaranteed under 

8 this subsection and a loan not guaranteed by 

9 Federal, State, or local government. 

10 ‘‘(B) AUTHORITY.— 

11 ‘‘(i) IN GENERAL.—A small business 

12 concern may combine a loan guaranteed 

13 under this subsection with a loan that is 

14 not guaranteed by Federal, State, or local 

15 government. 

16 ‘‘(ii) LENDER.—The nonguaranteed 

17 loan under clause (i) may be made by— 

18 ‘‘(I) the lender that provided the 

19 financing under this subsection or a 

20 different lender; or 

21 ‘‘(II) a lender in the Preferred 

22 Lenders Program. 

23 ‘‘(iii) SECURITY.—The nonguaranteed 

24 loan under clause (i) may be secured by a 

25 senior lien and the guaranteed loan under
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1 this subsection may be secured by a subor2 dinated lien. 

3 ‘‘(iv) APPLICATION.—A loan guar4 antee under this subsection on behalf of a 

5 small business concern, which is approved 

6 within 120 days of the date on which a 

7 nonguaranteed loan is obtained by the 

8 same small business concern, shall be sub9 ject to the provisions of this paragraph. 

10 ‘‘(C) FEE ON COMBINATION LOAN.—The 

11 lender shall pay a one-time fee of 0.5 percent 

12 of the amount of the nonguaranteed loan if the 

13 nonguaranteed portion of the loan has a senior 

14 credit position to the guaranteed portion of the 

15 loan. This fee shall be in addition to any other 

16 lender fees and shall not be charged to the bor17 rower. 

18 ‘‘(D) LOAN SIZE.— 

19 ‘‘(i) PREFERRED LENDERS PRO20 GRAM.—If the loan guaranteed under this 

21 subsection is processed under delegated au22 thority under the Preferred Lenders Pro23 gram, the maximum amount of the non24 guaranteed loan may not exceed— 

25 ‘‘(I) $1,000,000; or 
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1 ‘‘(II) a combination of 

2 $2,000,000 gross loan amount of a 

3 loan guaranteed by the Administra4 tion and an additional nonguaranteed 

5 loan of $1,000,000. 

6 ‘‘(ii) SMALL BUSINESS ADMINISTRA7 TION.—If the loan guaranteed under this 

8 subsection is processed and approved by 

9 Administration staff, the amount of the 

10 nonguaranteed loan may not exceed— 

11 ‘‘(I) $2,000,000; or 

12 ‘‘(II) a combination of 

13 $2,000,000 gross loan amount of a 

14 loan guaranteed by the Administra15 tion and an additional nonguaranteed 

16 loan of $2,000,000. 

17 ‘‘(E) USE OF PROCEEDS.—All proceeds 

18 from the fee collected under this subparagraph 

19 shall be used to offset the cost (as defined in 

20 section 502 of the Credit Reform Act of 1990) 

21 to the Administration of guaranteeing loans 

22 under this subsection.’’. 

23 (b) TERMINATION OF LENDER AUTHORITY TO RE24 TAIN GUARANTEE FEES.—Section 7(a)(18)(B) of the 
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1 Small Business Act (15 U.S.C. 636(a)(18)(B)) is amend2 ed to read as follows: 

3 ‘‘(B) RETENTION OF CERTAIN FEES.— 

4 ‘‘(i) IN GENERAL.—Except as pro5 vided under clause (ii), lenders partici6 pating in the programs established under 

7 this subsection may retain not more than 

8 25 percent of a fee collected under sub9 paragraph (A)(i). 

10 ‘‘(ii) FISCAL YEAR 2004.—Beginning 

11 on the date of enactment of this clause and 

12 ending on September 30, 2004, the Admin13 istration or its agent shall collect all fees 

14 under subparagraph (A)(i). All proceeds 

15 from fees collected under this paragraph 

16 shall be used to offset the cost (as defined 

17 in section 502 of the Credit Reform Act of 

18 1990) to the Small Business Administra19 tion of guaranteeing loans under this sub20 section.’’. 

21 (c) TEMPORARY MODIFICATION OF ANNUAL LENDER

22 FEE.—Section 7(a)(23) of the Small Business Act (15 

23 U.S.C. 636(a)) is amended— 

24 (1) by striking ‘‘0.25 percent’’ and inserting 

25 ‘‘0.35 percent’’; and 
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1 (2) by adding at the end the following: ‘‘All 

2 proceeds from the fee collected under this paragraph 

3 shall be used to offset the cost (as defined in section 

4 502 of the Credit Reform Act of 1990) to the Ad5 ministration of guaranteeing loans under this sub6 section.’’. 

7 (d) LIFTING LOAN RESTRICTIONS AND PRIORITY

8 PROCESSING OF REJECTED APPLICATIONS.— 

9 (1) IN GENERAL.—The Small Business Admin10 istration shall— 

11 (A) eliminate the program restrictions im12 posed by policy notices 5000–902 and 0000–

13 1709 to allow for the processing and approval 

14 of loan applications cancelled or returned be15 cause of the program shutdown or restrictions 

16 imposed by policy notices 5000–902, 0000–

17 1707, or 0000–1709; 

18 (B) permit a small business or lender to 

19 resubmit any loan application that was not con20 sidered or approved because of the program 

21 shutdown or restrictions imposed by policy no22 tices 5000–902, 0000–1707, or 0000–1709; 

23 (C) give priority to processing any applica24 tion submitted before January 8, 2004, that 

25 was not considered because of the program
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1 shutdown or loan restrictions imposed by policy 

2 notices 5000–902, 0000–1707, or 0000–1709; 

3 (D) give priority, to the extent possible, to 

4 approving all eligible loans that were cancelled 

5 or returned because of the program shutdown 

6 or restrictions imposed by policy notices 5000–

7 902, 0000–1707, or 0000–1709, in the order in 

8 which the applications were originally sub9 mitted; and 

10 (E) give priority to processing all eligible 

11 loans to any small business that has received fi12 nancing under section 7(a)(14) of the Small 

13 Business Act (15 U.S.C. 636(a)(14) and re14 quests a renewal of such financing, regardless 

15 of temporary restrictions imposed by the Small 

16 Business Administration through the policy no17 tices referred to in this paragraph, and approve 

18 such loans, if the small business is otherwise el19 igible for such financing under that section. 

20 (2) PROOF OF APPLICATION.—An application 

21 shall not be denied consideration or approval be22 cause the Small Business Administration failed to 

23 retain a record of receiving an application if the 

24 lender or borrower supplies proof that the applica-
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1 tion was submitted by mail, fax, or electronic means 

2 before January 8, 2004. 

3 (3) RESERVATION AND APPLICATION OF FEE

4 PROCEEDS.—All proceeds from fees authorized 

5 under section 7(a) of the Small Business Act (15 

6 U.S.C. 636(a)) shall be combined with any amounts 

7 appropriated to carry out such section and used— 

8 (A) first, to process and fund loan guaran9 tees approved pursuant to paragraph (d)(1); 

10 and 

11 (B) second, to process and fund other loan 

12 guarantees under section 7(a) of the Small 

13 Business Act. 

14 (4) NOTIFICATION REQUIREMENT.—The Small 

15 Business Administration shall not make any signifi16 cant policy or administrative changes affecting the 

17 operation of the loan program authorized under sec18 tion 7(a) of the Small Business Act (15 U.S.C. 

19 636(a)) unless, not later than 15 business days be20 fore such change, the Administrator of the Small 

21 Business Administration submits, under the Admin22 istrator’s signature, a report that specifically de23 scribes the proposed changes and the duration of 

24 those changes to— 
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1 (A) the chairman and ranking member of 

2 the Committee on Small Business and Entre3 preneurship of the Senate; and 

4 (B) the chairman and ranking member of 

5 the Committee on Small Business of the House 

6 of Representatives. 

7 (e) SUNSET DATE.—This section and the amend8 ments made by this section are repealed on October 1, 

9 2004. 

10 SEC. 5. RESUBMISSION OF DISASTER LOAN APPLICATIONS 

11 FOR CERTAIN BUSINESSES. 

12 (a) RESUBMISSION OF APPLICATIONS.—During the 

13 30-day period beginning on the date of enactment of this 

14 Act, a small business concern may resubmit an application 

15 for a loan that was not approved under section 7(b)(2) 

16 of the Small Business Act (15 U.S.C. 636(b)(2)) if the 

17 following conditions are met: 

18 (1) ORIGINAL APPLICATION.—The small busi19 ness concern originally submitted an application be20 fore January 1, 2003, in response to the events as21 sociated with Small Business Administration Dis22 aster Declaration 3364. 

23 (2) LOCATION.—On the date of the original 

24 submission of the application and on the date of the 

25 resubmission, the applicant operates a facility in 
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1 Bronx, Kings, Nassau, New York, Queens, Rich2 mond, or Westchester county in the State of New 

3 York. 

4 (3) INABILITY TO OPERATE.—Without regard 

5 to physical damage to a facility, the applicant was 

6 unable to operate at a facility because of a prohibi7 tion on the use of the facility, in whole or in part, 

8 by an order or other action of a Federal, State, or 

9 local government (or any instrumentality of any of 

10 the foregoing) for 20 or more consecutive days, oc11 curring as a result of the events associated with 

12 Small Business Administration Disaster Declaration 

13 3364. 

14 (b) STANDARD FOR APPROVAL.—The Administrator 

15 shall approve (without regard to any requirements applica16 ble under section 7(b) of the Small Business Act (15 

17 U.S.C. 636(b))), a loan with respect to any application 

18 resubmitted under subsection (a) if the applicant has a 

19 debt coverage ratio, as attested to by a qualified, inde20 pendent, third-party auditor, of not less than 1.15 for the 

21 applicant’s last taxable year ending before the date of the 

22 submission of the original application. For purposes of de23 termining the debt coverage ratio under this subsection, 

24 the Administrator shall not take into account any Federal 

25 or State tax lien or obligation other than a judgment lien. 
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1 (c) MINIMUM LOAN AMOUNT.—The Administrator 

2 shall not approve a loan under this section for an amount 

3 that is less than 80 percent of the documented losses 

4 shown on the application submitted under subsection (a). 

5 (d) COORDINATION WITH OTHER LOAN LIMITS.—No 

6 loan made under this section shall be taken into account 

7 under section 7(b)(3)(E) of the Small Business Act (15 

8 U.S.C. 636(b)(3)(E)).

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