Fair Access to Small Business Lending Act
Bill: S.1509 | Sponsor: Sen. Rubio, Marco (R-FL)
Policy area: Commerce

Summary:
Fair Access to Small Business Lending Act
This bill requires the Small Business Administration (SBA) to carry out an initiative to expand the availability of 7(a) loans to small businesses that are located in low- or moderate-income neighborhoods. (Under the 7(a) Program, the SBA provides business loans and loan guaranties to small business borrowers unable to obtain financing elsewhere.)
The SBA must expand authorization for providing 7(a) loans to lenders that meet the criteria to make such loans but have not otherwise been approved to do so. Such lenders must ensure that at least 50% of loans they make that are guaranteed pursuant to the bill are made to small businesses in low- or moderate-income neighborhoods.

To expand access to capital in underserved markets by providing 
 resources for the Small Business Administration to approve additional 
 Non-Federally Regulated Lenders to make business loans guaranteed by 
  the Small Business Administration to small business concerns in low-
               income and moderate-income neighborhoods.

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

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Fair Access to Small Business 
Lending Act''.

SEC. 2. FAIR ACCESS TO SMALL BUSINESS LENDING.

    Section 7(a)(17) of the Small Business Act (15 U.S.C. 636(a)(17)) 
is amended--
            (1) by striking ``(17) The Administration'' and inserting 
        the following:
            ``(17) Authorization of lenders.--
                    ``(A) In general.--The Administration''; and
            (2) by adding at the end the following:
                    ``(B) Access to capital for underserved markets.--
                            ``(i) Definitions.--In this subparagraph--
                                    ``(I) the term `covered Non-
                                Federally Regulated Lender' means a 
                                Non-Federally Regulated Lender (as 
                                defined in section 120.10 of title 13, 
                                Code of Federal Regulations, or any 
                                successor thereto) that--
                                            ``(aa) has not been 
                                        approved to make loans 
                                        guaranteed under this 
                                        subsection; and
                                            ``(bb) meets the applicable 
                                        criteria for authorizing 
                                        lenders to make loans 
                                        guaranteed under this 
                                        subsection; and
                                    ``(II) the term `low or moderate-
                                income neighborhood' means a 
                                neighborhood that is a low-income 
                                neighborhood or a moderate-income 
                                neighborhood, for the purposes of the 
                                Community Reinvestment Act of 1977 (12 
                                U.S.C. 2901 et seq.).
                            ``(ii) Initiative.--
                                    ``(I) In general.--The 
                                Administrator, acting through the 
                                Office of Credit Risk Management, shall 
                                carry out an initiative to authorize 
                                covered Non-Federally Regulated Lenders 
                                to make loans guaranteed under this 
                                subsection that is targeted to 
                                expanding the availability of loans 
                                guaranteed under this subsection to 
                                small business concerns that are 
                                located in a low or moderate-income 
                                neighborhood.
                                    ``(II) Authority.--Under the 
                                initiative under subclause (I), the 
                                Administrator may not approve a covered 
                                Non-Federally Regulated Lender to only 
                                be eligible to make loans guaranteed 
                                under the Community Advantage Pilot 
                                Program of the Administration.
                                    ``(III) Lenders.--A covered Non-
                                Federally Regulated Lender that becomes 
                                authorized to make loans guaranteed 
                                under this subsection under the 
                                initiative under subclause (I) shall 
                                ensure that not less than 50 percent of 
                                the loans made by the covered Non-
                                Federally Regulated Lender that are 
                                guaranteed under this subsection are 
                                made to small business concerns that 
                                are located in a low or moderate-income 
                                neighborhood.
                            ``(iii) Funding.--For fiscal year 2021, and 
                        each fiscal year thereafter, there is 
                        appropriated to the Administrator, out of any 
                        money in the Treasury not otherwise 
                        appropriated, such sums as are necessary to 
                        carry out the initiative under clause (ii).''.
                                 <all>