H. R. 4062
One Hundred Eighth Congress
of the
United States of America
AT THE SECOND SESSION
Begun and held at the City of Washington on Tuesday,
the twentieth day of January, two thousand and four
An Act
To provide for an additional temporary extension of programs under the Small
Business Act and the Small Business Investment Act of 1958 through June
4, 2004, 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. ADDITIONAL TEMPORARY EXTENSION OF AUTHORIZATION
OF PROGRAMS UNDER SMALL BUSINESS ACT AND SMALL
BUSINESS INVESTMENT ACT OF 1958.
The authorization for any program, authority, or provision,
including any pilot program, that was extended through April 2,
2004, by section 1 of Public Law 108–205 is further extended
through June 4, 2004, under the same terms and conditions.
SEC. 2. EXTENSION OF CERTAIN FEE AUTHORIZATIONS.
Section 503(f) of the Small Business Investment Act of 1958
(15 U.S.C. 697(f)), as amended by section 2 of Public Law 108–
205, is further amended by striking ‘‘May 21, 2004’’ and inserting
‘‘October 1, 2004’’.
SEC. 3. FISCAL YEAR 2004 PURCHASE AND GUARANTEE AUTHORITY
UNDER TITLE III OF SMALL BUSINESS INVESTMENT ACT
OF 1958.
Section 20 of the Small Business Act (15 U.S.C. 631 note)
is amended by adding at the end the following new subsection:
‘‘(j) FISCAL YEAR 2004 PURCHASE AND GUARANTEE AUTHORITY
UNDER TITLE III OF SMALL BUSINESS INVESTMENT ACT OF 1958.—
For fiscal year 2004, for the programs authorized by title III of
the Small Business Investment Act of 1958 (15 U.S.C. 681 et
seq.), the Administration is authorized to make—
‘‘(1) $4,000,000,000 in purchases of participating securities;
and
‘‘(2) $3,000,000,000 in guarantees of debentures.’’.
SEC. 4. COMBINATION FINANCING.
(a) IN GENERAL.—During the period beginning on the date
of the enactment of this section and ending on September 30,
2004, subsection (a) of section 7 of the Small Business Act (15
U.S.C. 636(a)) shall be applied as if the paragraph set forth in
subsection (b) were added at the end of that subsection (a).
(b) PARAGRAPH SPECIFIED.—The paragraph referred to in sub-
section (a) is as follows:
‘‘(31) COMBINATION FINANCING.—
‘‘(A) DEFINITIONS.—In this paragraph—
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‘‘(i) the term ‘combination financing’ means financing
comprised of a loan guaranteed under this subsection and
a commercial loan; and
‘‘(ii) the term ‘commercial loan’ means a loan which
is part of a combination financing and no portion of which
is guaranteed by the Federal Government.
‘‘(B) APPLICABILITY.—This paragraph applies to a loan guar-
antee obtained by a small business concern under this sub-
section, if the small business concern also obtains a commercial
loan.
‘‘(C) COMMERCIAL LOAN AMOUNT.—In the case of any com-
bination financing, the amount of the commercial loan which
is part of such financing shall not exceed the gross amount
of the loan guaranteed under this subsection which is part
of such financing.
‘‘(D) COMMERCIAL LOAN PROVISIONS.—The commercial loan
obtained by the small business concern—
‘‘(i) may be made by the participating lender that is
providing financing under this subsection or by a different
lender;
‘‘(ii) may be secured by a senior lien; and
‘‘(iii) may be made by a lender in the Preferred Lenders
Program, if applicable.
‘‘(E) COMMERCIAL LOAN FEE.—A one-time fee in an amount
equal to 0.7 percent of the amount of the commercial loan
shall be paid by the lender to the Administration if the commer-
cial loan has a senior credit position to that of the loan guaran-
teed under this subsection. Paragraph (23)(B) shall apply to
the fee established by this paragraph.
‘‘(F) DEFERRED
PARTICIPATION
LOAN
SECURITY.—A loan
guaranteed under this subsection may be secured by a subordi-
nated lien.
‘‘(G) 
COMPLETION
OF
APPLICATION
PROCESSING.—The
Administrator shall complete processing of an application for
combination financing under this paragraph pursuant to the
program authorized by this subsection as it was operating
on October 1, 2003.
‘‘(H) BUSINESS
LOAN
ELIGIBILITY.—Any standards pre-
scribed by the Administrator relating to the eligibility of small
business concerns to obtain combination financing under this
subsection which are in effect on the date of the enactment
of this paragraph shall apply with respect to combination
financings made under this paragraph. Any modifications to
such standards by the Administrator after such date shall
not unreasonably restrict the availability of combination
financing under this paragraph relative to the availability of
such financing before such modifications.’’.
SEC. 5. LOAN GUARANTEE FEES.
(a) IN GENERAL.—During the period beginning on the date
of the enactment of this section and ending on September 30,
2004, subparagraph (A) of paragraph (23) of subsection (a) of section
7 of the Small Business Act (15 U.S.C. 636(a)(23)(A)) shall be
applied as if that subparagraph consisted of the language set forth
in subsection (b).
(b) LANGUAGE SPECIFIED.—The language referred to in sub-
section (a) is as follows:
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‘‘(A) PERCENTAGE.—
‘‘(i) IN GENERAL.—With respect to each loan guaranteed
under this subsection, the Administrator shall, in accord-
ance with such terms and procedures as the Administrator
shall establish by regulation, assess and collect an annual
fee in an amount equal to 0.5 percent of the outstanding
balance of the deferred participation share of the loan.
‘‘(ii) TEMPORARY PERCENTAGE.—With respect to loans
approved during the period beginning on the date of enact-
ment of this clause and ending on September 30, 2004,
the annual fee assessed and collected under clause (i) shall
be equal to 0.36 percent of the outstanding balance of
the deferred participation share of the loan.’’.
(c) RETENTION OF CERTAIN FEES.—Subparagraph (B) of para-
graph (18) of subsection (a) of section 7 of the Small Business
Act (15 U.S.C. 636(a)(18)(B)) shall not be effective during the period
beginning on the date of the enactment of this section and ending
on September 30, 2004.
SEC. 6. EXPRESS LOAN PROVISIONS.
(a) DEFINITIONS.—For the purposes of this section:
(1) The term ‘‘express lender’’ shall mean any lender
authorized by the Administrator to participate in the Express
Loan Pilot Program.
(2) The term ‘‘Express Loan’’ shall mean any loan made
pursuant to section 7(a) of the Small Business Act (15 U.S.C.
636(a)) in which a lender utilizes to the maximum extent prac-
ticable its own loan analyses, procedures, and documentation.
(3) The term ‘‘Express Loan Pilot Program’’ shall mean
the program established by the Administrator prior to the
date of enactment of this section under the authority granted
in section 7(a)(25)(B) of the Small Business Act (15 U.S.C.
636(a)(25)(B)) with a guaranty rate not to exceed 50 percent.
(4) The term ‘‘Administrator’’ means the Administrator of
the Small Business Administration.
(5) The term ‘‘small business concern’’ has the same
meaning given such term under section 3(a) of the Small Busi-
ness Act (15 U.S.C. 632(a)).
(b) RESTRICTION TO EXPRESS LENDER.—The authority to make
an Express Loan shall be limited to those lenders deemed qualified
to make such loans by the Administrator. Designation as an express
lender for purposes of making an Express Loan shall not prohibit
such lender from taking any other action authorized by the Adminis-
trator for that lender pursuant to section 7(a) of the Small Business
Act (15 U.S.C. 636(a)).
(c) GRANDFATHERING
OF
EXISTING
LENDERS.—Any express
lender shall retain such designation unless the Administrator deter-
mines that the express lender has violated the law or regulations
promulgated by the Administrator or modifies the requirements
to be an express lender and the lender no longer satisfies those
requirements.
(d) TEMPORARY EXPANSION OF EXPRESS LOAN PILOT PROGRAM.—
(1) AUTHORIZATION.—As of the date of enactment of this
section, the maximum loan amount in the Express Loan Pilot
Program shall be increased to a maximum loan amount of
$2,000,000 as set forth in section 7(a)(3)(A) of the Small Busi-
ness Act (15 U.S.C. 636(a)(3)(A)).
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(2) TERMINATION DATE.—The authority set forth in para-
graph (1) shall terminate on September 30, 2004.
(3) SAVINGS PROVISION.—Nothing in this section shall be
interpreted to modify or alter the authority of the Administrator
to continue to operate the Express Loan Pilot Program on
or after October 1, 2004.
(e) OPTION TO PARTICIPATE.—Except as otherwise provided in
this section, the Administrator shall take no regulatory, policy,
or administrative action, without regard to whether such action
requires notification pursuant to section 7(a)(24) of the Small Busi-
ness Act (15 U.S.C. 636(a)(24)), that has the effect of—
(1) requiring a lender to make an Express Loan pursuant
to subsection (d);
(2) limiting or modifying any term or condition of deferred
participation loans made under such section (other than
Express Loans) unless the Administrator imposes the same
limit or modification on Express Loans;
(3) transferring or re-allocating staff, staff responsibilities,
resources, or funding, if the result of such transfer or re-
allocation would be to increase the average loan processing,
approval, or disbursement time above the averages for those
functions as of October 1, 2003, for loan guarantees approved
under such section by employees of the Administration or
through the Preferred Lenders Program; or
(4) otherwise providing any incentive or disincentive which
encourages lenders or borrowers to make or obtain loans under
the Express Loan Pilot Program instead of under the general
loan authority of section 7(a) of the Small Business Act (15
U.S.C. 636(a)).
(f) COLLECTION
AND REPORTING
OF DATA.—For all loans in
excess of $250,000 made pursuant to the authority set forth in
subsection (d)(1), the Administrator shall, to the extent practicable,
collect data on the purpose for each such loan. The Administrator
shall report monthly to the Committee on Small Business and
Entrepreneurship of the Senate and the Committee on Small Busi-
ness of the House of Representatives on the number of such loans
and their purposes.
(g) TERMINATION.—Subsections (b), (c), (e), and (f) shall not
apply after September 30, 2004.
SEC. 7. FISCAL YEAR 2004 DEFERRED PARTICIPATION STANDARDS.
Deferred participation loans made during the period beginning
on the date of the enactment of this Act and ending on September
30, 2004, under section 7(a) of the Small Business Act (15 U.S.C.
636(a)) shall have the same terms and conditions (including max-
imum gross loan amounts and collateral requirements) as were
applicable to loans made under such section on October 1, 2003,
except as otherwise provided in this Act. This section shall not
preclude the Administrator of the Small Business Administration
from taking such action as necessary to maintain the loan program
carried out under such section, subject to appropriations.
SEC. 8. TEMPORARY INCREASE IN LOAN LIMIT UNDER BUSINESS LOAN
AND INVESTMENT FUND AND IN ASSOCIATED GUAR-
ANTEE FEES.
(a) TEMPORARY INCREASE IN AMOUNT PERMITTED TO BE OUT-
STANDING AND COMMITTED.—During the period beginning on the
date of the enactment of this Act and ending on September 30,
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2004, section 7(a)(3)(A) of the Small Business Act (15 U.S.C.
636(a)(3)(A)) shall be applied as if the first dollar figure were
$1,500,000.
(b) TEMPORARY GUARANTEE FEE ON DEFERRED PARTICIPATION
SHARE OVER $1,000,000.—With respect to loans made during the
period referred to in subsection (a) to which section 7(a)(18) of
the Small Business Act (15 U.S.C. 636(a)(18)) applies, the Adminis-
trator of the Small Business Administration shall collect an addi-
tional guarantee fee equal to 0.25 percent of the amount (if any)
by which the deferred participation share of the loan exceeds
$1,000,000.
Speaker of the House of Representatives.
Vice President of the United States and
President of the Senate.