(7) without the full recovery and prosperity of 
affected businesses, the Gulf Coast and the rest of 
the United States will be negatively impacted. 
SEC. 3. DEFINITIONS. 
In this Act— 
(1) the term ‘‘Disaster Area’’ means an area in 
which the President has declared a major disaster in 
response to Hurricane Katrina of 2005 or Hurricane 
Rita of 2005; 
(2) 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); and 
(3) the term ‘‘small business concern’’ has the 
meaning given that term in section 3 of the Small 
Business Act (15 U.S.C. 632). 
SEC. 4. SMALL BUSINESS CONCERN RECOVERY GRANTS. 
(a) IN GENERAL.—There are authorized to be appro-
priated to the Secretary of Commerce $100,000,000 for 
the Economic Development Administration of the Depart-
ment of Commerce to make grants to the appropriate 
State government agencies in Louisiana and Mississippi, 
to carry out this section. 
(b) DISBURSEMENT OF FUNDS.— 
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(1) IN GENERAL.—Subject to paragraph (2), 
the Secretary of Commerce shall disburse the funds 
authorized under subsection (a) as follows: 
(A) $75,000,000 to the State of Louisiana. 
(B) $25,000,000 to the State of Mis-
sissippi. 
(2) PROPORTIONATE ALLOCATION.—Regardless 
of the amount appropriated under subsection (a), 
the amount appropriated shall be allocated among 
the States listed in paragraph (1) of this subsection 
in direct proportion to the allocation under that 
paragraph. 
(c) USE OF FUNDS.— 
(1) IN GENERAL.—Grants awarded to a State 
under subsection (a) shall be used by the State to 
provide grants, which may be made to any small 
business concern located in a Disaster Area that was 
negatively impacted by Hurricane Katrina of 2005 
or Hurricane Rita of 2005, to assist such small busi-
ness concern for the purposes of— 
(A) paying employees; 
(B) paying bills, insurance costs, and other 
existing financial obligations; 
(C) making repairs; 
(D) purchasing inventory; 
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(E) restarting or operating that business 
in the community in which it was conducting 
operations prior to Hurricane Katrina of 2005 
or Hurricane Rita of 2005, or to a neighboring 
area or county or parish in a Disaster Area; 
(F) compensating such small business con-
cerns for direct economic injury suffered as a 
result of Hurricane Katrina of 2005 or Hurri-
cane Rita of 2005; or 
(G) covering additional costs until that 
small business concern is able to obtain funding 
through insurance claims, Federal assistance 
programs, or other sources. 
(2) CRITERIA.— 
(A) IN
GENERAL.—Notwithstanding any 
other provision of law, in making grants under 
paragraph (1), a State may use such criteria as 
the State determines appropriate, and shall not 
be required to apply eligibility criteria for pro-
grams administered by the Federal Govern-
ment, including the Department of Commerce. 
(B) EXCLUSION.—In making grants under 
paragraph (1), a State may not exclude a small 
business concern based on any increase in the 
revenue of that small business concern during 
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the 12-month period beginning on October 1, 
2005. 
(3) ADMINISTRATIVE EXPENSES.—The Depart-
ment of Commerce may use not more than 
$1,500,000 of the funds authorized under subsection 
(a) to administer the provision of grants to the des-
ignated States under this subsection. 
SEC. 5. DISASTER LOANS AFTER HURRICANE KATRINA OR 
HURRICANE RITA. 
(a) IN GENERAL.—Section 7(b) of the Small Busi-
ness Act (15 U.S.C. 636(b)) is amended by inserting im-
mediately after paragraph (3) the following: 
‘‘(4) DISASTER
LOANS
AFTER
HURRICANE 
KATRINA
OR
HURRICANE
RITA
IN
A
DISASTER 
AREA.— 
‘‘(A) DEFINITIONS.—In this paragraph— 
‘‘(I) the term ‘Disaster Area’ means 
an area in which the President has de-
clared a major disaster in response to Hur-
ricane Katrina of 2005 or Hurricane Rita 
of 2005; and 
‘‘(ii) the term ‘qualified borrower’ 
means a person to whom the Administrator 
made a loan under this section because of 
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Hurricane Katrina of 2005 or Hurricane 
Rita of 2005. 
‘‘(B) DEFERMENT
OF
DISASTER
LOAN 
PAYMENTS.— 
‘‘(i) IN
GENERAL.—Notwithstanding 
any other provision of law, payments of 
principal and interest on a loan to a quali-
fied borrower made before December 31, 
2006, shall be deferred, and no interest 
shall accrue with respect to such loan, dur-
ing the time period described in clause (ii). 
‘‘(ii) TIME PERIOD.—The time period 
for purposes of clause (i) shall be 1 year 
from the later of the date of enactment of 
this paragraph or the date on which funds 
are distributed under a loan described in 
clause (i), but may be extended to 2 years 
from such date, at the discretion of the 
Administrator. 
‘‘(iii) RESUMPTION OF PAYMENTS.— 
At the end of the time period described in 
clause (ii), the payment of periodic install-
ments of principal and interest shall be re-
quired with respect to such loan, in the 
same manner and subject to the same 
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terms and conditions as would otherwise be 
applicable to any other loan made under 
this subsection.’’. 
(b) INCREASING COLLATERAL REQUIREMENTS.— 
(1) IN GENERAL.—Notwithstanding any other 
provision of law, including section 7(c)(6) of the 
Small Business Act (15 U.S.C. 636(c)(6)), the Ad-
ministrator may not require collateral for any cov-
ered loan made by the Administrator. 
(2) DEFINITION.—In this subsection, the term 
‘‘covered loan’’ means a loan in an amount of not 
more than $35,000 made— 
(A) under section 7(b)(1) of the Small 
Business Act (15 U.S.C. 636(b)(1)); 
(B) as a result of Hurricane Katrina of 
2005 or Hurricane Rita of 2005; and 
(C) after the date of enactment of this Act. 
SEC. 6. OTHER PROGRAMS. 
(a) HUBZONES.—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 ‘‘; or’’; and 
(C) by adding at the end the following: 
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‘‘(F) an area in which the President has 
declared a major disaster (as that term is de-
fined 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 de-
scribed in paragraph (8).’’; and 
(2) 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 Admin-
istrator, be extended to be the 3-year period be-
ginning on the later of the date of enactment 
of this paragraph and August 29, 2007.’’. 
(b) RELIEF FROM TEST PROGRAM.—Section 711(d) 
of the Small Business Competitive Demonstration Pro-
gram Act of 1988 (15 U.S.C. 644 note) is amended— 
(1) by striking ‘‘The Program’’ and inserting 
the following: 
‘‘(1) IN GENERAL.—Except as provided in para-
graph (2), the Program’’; and 
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(2) by adding at the end the following: 
‘‘(2) EXCEPTION.— 
‘‘(A) IN
GENERAL.—The Program shall 
not apply to any contract related to relief or re-
construction from Hurricane Katrina of 2005 
or Hurricane Rita of 2005 during the time pe-
riod described in subparagraph (B). 
‘‘(B) TIME PERIOD.—The time period for 
the purposes of subparagraph (A)— 
‘‘(I) shall be the 2-year period begin-
ning on the later of the date of enactment 
of this paragraph and August 29, 2007; 
and 
‘‘(ii) may, at the discretion of the Ad-
ministrator, be extended to be the 3-year 
period beginning on the later of the date of 
enactment of this paragraph and August 
29, 2007.’’. 
Æ 
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