Microloan Program Technical Corrections Act of 1999
PL 106-22 (H.R.440), enacted 04/27/1999

113 STAT. 36 
PUBLIC LAW 106-22—APR. 27, 1999 
Public Law 106-22 
106th Congress 
An Act 
Apr. 27, 1999 
[H.R. 440] 
To make technical corrections to the Microloan Program. 
Be it enacted by the Senate and House of Representatives 
of 
Microloan 
the United States of America in Congress assembled, 
Prosxam 
Technical 
SECTION 1. SHORT TITLE. 
JflS'""^^^* 
This Act may be cited as the "Microloan Program Technical 
Small business. 
Corrections Act of 1999". 
15 u s e 631 note, 
g^^ ^ TECHNICAL CORRECTIONS. 
Section 7(m) of the Small Business Act (15 U.S.C. 636(m)) 
is amended— 
(1) in p£iragraph (7), by striking subpgiragraph (B) and 
inserting the following: 
"(B) ALLOCATION.— 
"(i) MINIMUM ALLOCATION.—Subject to the avail-
ability of appropriations, of the total eunount of new 
loan funds made available for award luider this sub-
section in each fiscal year, the Administration shall 
make available for award in each State (including the 
District of Columbia, the Commonwealth of Puerto 
Rico, the United States Virgin Islands, GuEon, and 
American Samoa) em amount equsd to the sum of— 
"(I) the lesser of— 
"(aa) $800,000; or 
"(bb) V55 of the total amount of new loan 
funds made available for award under this 
subsection for that fiscal yeEu*; and 
"(II) any additional amount, as determined by 
the Administration. 
"(ii) REDISTRIBUTION.—If, at the beginning of the 
third quarter of a fiscal year, the Administration deter-
mines that any portion of the sunount made available 
to carry out this subsection is unlikely to be made 
available under clause (i) during that fiscsQ year, the 
Administration may make that portion available for 
award in any one or more States (including the District 
of Columbia, the Commonwealth of Puerto Rico, the 
United States Virgin Isleuids, Guam, and American 
Samoa) without regard to clause (i)."; and 
(2) in paragraph (8)— 
(A) by inserting "and providing funding to inter-
mediaries" after "program applicants"; and 
(B) by inserting "euid provide funding to" after "shedl 
select". 
PUBLIC LAW 106-22—APR. 27, 1999 
113 STAT. 37 
SEC. 3. LOAN LOSS RESERVE. 
Section 7(m)(3)(D) of the Small Business Act (15 U.S.C. 
636(m)(3)(D)) is amended to read as follows: 
"(D)(i) IN GENERAL.—The Administrator shall, by regu- Regulations. 
lation, require each intermediary to establish a loan loss 
reserve fund, and to maintain such reserve fund until 
all obligations owed to the Administration imder this sub-
section are repaid. 
"(ii) LEVEL OF LOAN LOSS RESERVE FUND.— 
"(I) IN GENERAL.—Subject to subclause (III), the 
Administrator shall require the loan loss reserve fund 
of an intermediary to be maintained at a level equal 
to 15 percent of the outstsinding bedance of the notes 
receivable owed to the intermediary. 
"(II) REVIEW OF LOAN LOSS RESERVE.—After the 
initial 5 years of an intermediary's participation in 
the program 
authorized by this subsection, the 
Administrator shall, at the request of the intermediary, 
conduct a review of the annual loss rate of the inter-
mediary. Any intermediary in operation under this 
subsection prior to October 1, 1994, that requests a 
reduction in its loan loss reserve shall be reviewed 
based on the most recent 5-year period preceding the 
request. 
"(Ill) REDUCTION OF LOAN LOSS RESERVE.—Subject 
to the requirements of clause IV, the Administrator 
may reduce the annual loan loss reserve requirement 
of an intermediary to reflect the actual average loan 
loss rate for the intermediary during the preceding 
5-year period, except that in no case shall the loan 
loss reserve be reduced to less than 10 percent of 
the outstanding balance of the notes receivable owed 
to the intermediary. 
"(IV) 
REQUIREMENTS.—The Administrator 
may 
reduce the annual loan loss reserve requirement of 
£in intermediary only if the intermediary demonstrates 
to the satisfaction of the Administrator that— 
"(aa) the average annual loss rate for the inter-
mediary during the preceding 5-year period is less 
than 15 percent; and 
"(bb) that no other factors exist that may 
impair the ability of the intermediary to repay 
all obligations owed to the Administration under 
this subsection.". 
Approved April 27, 1999. 
LEGISLATIVE HISTORY—H.R. 440: 
HOUSE REPORTS: No. 106-12 (Comm. on Small Business). 
CONGRESSIONAL RECORD, Vol. 145 (1999): 
Feb. 9, considered and passed House. 
Mar. 25, considered and passed Senate, amended. 
Apr. 12, House concurred in Senate amendment.