WASHINGTON - Working to enact a program that emphasizes prevention in dealing with natural disasters, the bill Senators John F. Kerry (D-Mass.) and Max Cleland (D-Ga.) first introduced in the 105th Congress has passed both the House and Senate and is on its way to the President for signature.

This bill makes low-cost, long-term loans available to small businesses to take preventative measures before a natural disaster occurs. Designed as five-year disaster mitigation pilot program, it would allow SBA to make direct and guaranteed loans to non-farm small business owners, who can't get credit elsewhere and who live in disaster-prone areas. The loans would be used for financing preventive measures to protect businesses against, and lessen the extent of, future disaster damage.

"Prevention is a smart way to help small businesses reduce the damage and destruction caused by natural disasters," said Kerry. "Whether it is elevating a foundation or constructing sea walls, these funds can help protect small businesses from potentially devastating effects. Estimates show that two dollars are saved for every one dollar spent on disaster mitigation."

Currently, SBA's disaster loans are available for mitigation after a recent natural disaster. Those loans are also limiting because only 20 percent of an SBA disaster loan may be used to install new mitigation techniques that will prevent future damage. In contrast, this legislation would allow 100 percent of an SBA disaster loan to be used for mitigation purposes within any area that the Federal Emergency Management Agency has designated as disaster-prone.

In Massachusetts, that includes Marshfield and Quincy, two coastal communities that are prone to flooding, rainstorms and Nor'easters.

The Clinton Administration included this program in the budget for fiscal years 1999 requested up to $15 million of the total $358 million proposed for disaster loans be used for disaster mitigation loans.