‘‘(i) recommend or approve a guar-
antee of a debenture by the Administrator 
under the Certified Development Company 
Program that is collateralized by a second 
lien position on the property being con-
structed or acquired; and 
‘‘(ii) provide, or be affiliated with a 
corporation or other entity which provides, 
financing collateralized by a first lien on 
the same property. 
‘‘(B) EXCEPTION.—A certified develop-
ment company that was participating as a first 
mortgage lender, either directly or through an 
affiliate, for the Certified Development Com-
pany Program in either of fiscal years 2004 or 
2005 may continue to do so. 
‘‘(3) OTHER ECONOMIC DEVELOPMENT ACTIVI-
TIES.—It shall not be a conflict of interest for a cer-
tified development company to operate multiple pro-
grams to assist small business concerns as part of 
carrying out its economic development purpose. 
‘‘(4) ACCEPTANCE
OF
FUNDING
SUBJECT
TO 
RESTRICTIONS.— 
‘‘(A) IN
GENERAL.—A certified develop-
ment company may not accept funding that is 
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subject to a restriction described in subpara-
graph (B) from a source (including a source 
that is a department or agency of the Federal 
Government) unless the source also provides all 
of the financial assistance to be delivered by the 
certified development company under this title 
and the restriction is limited solely to the finan-
cial assistance so provided. 
‘‘(B) RESTRICTIONS COVERED.—A restric-
tion referred to in subparagraph (A) is— 
‘‘(i) a condition, priority, or restric-
tion upon the types of small businesses to 
which the certified development company 
may deliver financial assistance under this 
title; or 
‘‘(ii) a condition or requirement, di-
rectly or indirectly, upon the small busi-
ness to which financial assistance is to be 
delivered under this title. 
‘‘(e) MULTISTATE OPERATIONS.— 
‘‘(1) AUTHORIZATION.—Notwithstanding any 
other provision of law, the Administrator shall per-
mit a certified development company to make loans 
in any State that is contiguous to the State of incor-
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poration of that certified development company, only 
if such company— 
‘‘(A) is— 
‘‘(i) an accredited lender under section 
507; or 
‘‘(ii) a premier certified lender under 
section 508; 
‘‘(B) meets or exceeds performance stand-
ards established by the Administrator; 
‘‘(C) has a membership that contains not 
fewer than 25 members from each State in 
which the company makes loans and meets the 
requirements of paragraph (6)(B) for member-
ship in each State; 
‘‘(D) has a board of directors that contains 
not fewer than 1 member from each State in 
which the company makes loans; 
‘‘(E) has not fewer than 1 loan com-
mittee— 
‘‘(i) that considers loan applications 
from small businesses in States other than 
the State of incorporation of the certified 
development company; 
‘‘(ii) that has at least one member 
with commercial lending experience; and 
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‘‘(iii) that does not have any staff of 
the certified development company serving 
on the loan committee; and 
‘‘(F) submits to the Administrator, in writ-
ing— 
‘‘(i) a notice of the intention of the 
company to make loans in multiple States; 
‘‘(ii) the names of the States in which 
the company intends to make loans; 
‘‘(iii) a detailed statement of how the 
company will comply with this paragraph, 
including a list of the members described 
in subparagraph (C). 
‘‘(2) REVIEW.—The Administrator shall verify 
whether a certified development company satisfies 
the requirements of paragraph (1) on an expedited 
basis and, not later than 30 days after the date on 
which the Administrator receives the statement de-
scribed in paragraph (1)(E)(iii), the Administrator 
shall determine whether such company satisfies such 
criteria and provide notice to such company. 
‘‘(3) LOAN COMMITTEE OPERATION.— 
‘‘(A) APPROVAL
REQUIRED.—Any loan 
made by a certified development company in a 
State other than its State of incorporation shall 
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be approved by a loan committee established 
pursuant to subsection (e)(1)(E) of this section. 
No such loan shall be approved if the loan com-
mittee does not have at least one member from 
the State in which the loan is made and such 
member participates in the review of the loan. 
‘‘(B) RATIFICATION BY BOARD.—Any loan 
made in a State other than the State of incor-
poration must be ratified by the Board of Di-
rectors of the certified development company. 
‘‘(4) AGGREGATE
ACCOUNTING.—A company 
described in paragraph (1) may maintain an aggre-
gate accounting of all revenue and expenses of the 
company for purposes of this title. 
‘‘(5) LOCAL JOB CREATION REQUIREMENTS.— 
‘‘(A) IN GENERAL.—Any certified develop-
ment company making loans in multiple States 
shall satisfy any applicable job creation or re-
tention requirements separately for each such 
State. Such a company shall not count jobs cre-
ated or retained in 1 State towards any applica-
ble job creation or retention requirement in an-
other State. 
‘‘(B) TRANSITION PERIOD.—The require-
ment of subparagraph (A) does not apply dur-
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ing the 2-year period beginning with the date 
on which the Administrator authorizes multi- 
State operations. 
‘‘(6) CONTROL OF MULTIPLE COMPANIES.— 
‘‘(A) IN GENERAL.—No one either directly 
or indirectly may exercise a position of control 
on more than one certified development com-
pany. 
‘‘(B) CLOSE RELATIVES.—No close relative 
of an individual who holds a position of control 
in a certified development company may hold a 
position of control on a certified development 
company other than the company on which the 
individual serves. 
‘‘(C) DEFINITIONS.—In this paragraph— 
‘‘(i) the term ‘close relative’ means a 
spouse, parent, child, or sibling, or the 
spouse of a parent, child, or sibling; and 
‘‘(ii) the term ‘position of control’ 
means a certified development company’s 
officer, member of the board of directors, 
manager, chief executive officer, agent in-
volved in the loan process, key employee or 
similar management position, or, if the cer-
tified development company is a for-profit 
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