Mr. KERRY . Madam President, I want to submit for the RECORD a managers' substitute amendment to S. 1499, the American Small Business Emergency Relief and Recovery Act of 2001, which incorporates a number of improvements to the emergency relief provided by the bill as introduced. Senator Bond and I have been trying to bring this up before the full Senate, but, for almost one month since October 15, two senators have been blocking its consideration and passage.
The Kerry -Bond bill is a fiscally responsible and measured response to help small businesses that are struggling because they were affected by the attacks on September 11 or because they can't get loans or venture capital from traditional private-sector lenders and investors who are pessimistic about the economy. This legislation makes loan capital and business counseling available to the small businesses in all of our States, and it does so by tailoring many of the Small Business Administration's, SBA , programs.
Let me draw your attention to changes included in the managers' substitute amendment:
One. For businesses located in a declared disaster area or at an airport, or for small businesses that were closed or suspended for related national security reasons by Federal mandate, they may use the disaster loan proceeds to refinance any existing business debt within the bill's loan caps. For one year after approval of such refinancing, principal payments on such refinancings will be deferred and the small business will be required to make interest only payments. Full payments will resume at the end of that year.
Two. For emergency relief loans under section 7(a) of the Small Business Act, the guaranteed percentage was reduced from 95 percent to 90 percent in response to the Administration's concerns that the government's risk was too high at 95 percent.
Three. The size standard applicable for travel agencies with respect to disaster loans and emergency 7(a) loans under the managers' amendment is increased from $1 million to $2 million in average annual receipts.
Four. The SBA Administrator's authority to waive or increase size standards and size regulations is applied to both disaster loans and emergency 7(a) guaranteed loans.
Five. In order to encourage lenders to make the emergency and regular 7(a) loans to small businesses adversely affected by the effects of the terrorist attacks of September 11, 200l, the managers' amendment reduces the on-going lenders' fee from one-half of 1 percent to one-quarter of 1 percent.
Six. The requirement of non-Federal match is waived for the Women's Business Centers program with respect to individualized assistance authorized under this Act.
Seven. It requires the SBA to report to the pertinent House and Senate Committees periodically on its implementation of this legislation.
Eight. The managers' amendment increases the authorization levels for the 7(a) and 504 programs by $2 billion each, and for the Small Business Investment Company participating securities and debentures programs by $700 million and $200 million, respectively, to accommodate increased demand anticipated in the wake of the terrorist attacks of September 11, 2001.
Nine. In the loan term provisions for emergency 7(a) loans, a cap of $3 million was added for the ``gross amount of the loans.'' This clarifies that the other stated caps apply to the SBA -guaranteed portions of the loans.
Ten. To make clear that Congress expects the SBA to implement these emergency relief provisions as quickly as possible, a section was added requiring SBA to issue interim final rules and implementing guidelines within 20 days of the date of enactment of this legislation.
Eleven. Under the 7(a) stimulus loans, the managers' amendment reduces by half the upfront guarantee fee paid by the borrower, and it establishes a guarantee percentage of 85 percent on all such loans.
Twelve. Under 504 stimulus loans, the managers' amendment reduces by half the annual guarantee fee paid by the borrower, currently .41 percent, and retains the upfront bank fee of 50 basis points, .50 percent.
These are important changes that Senator Bond and I have worked out to make a good bill better. I am very pleased that the Chairman of the House Committee on Small Business, Congressman Don Manzullo, and Congressman Jim Moran introduced a bill identical to our managers' amendment on November 6 and appreciate their cooperation throughout this process.
The Kerry -Bond bill is a fiscally responsible and measured response to help small businesses that are struggling because they were affected by the attacks on September 11 or because they can't get loans or venture capital from traditional private-sector lenders and investors who are pessimistic about the economy. This legislation makes loan capital and business counseling available to the small businesses in all of our States, and it does so by tailoring many of the Small Business Administration's, SBA , programs.
Let me draw your attention to changes included in the managers' substitute amendment:
One. For businesses located in a declared disaster area or at an airport, or for small businesses that were closed or suspended for related national security reasons by Federal mandate, they may use the disaster loan proceeds to refinance any existing business debt within the bill's loan caps. For one year after approval of such refinancing, principal payments on such refinancings will be deferred and the small business will be required to make interest only payments. Full payments will resume at the end of that year.
Two. For emergency relief loans under section 7(a) of the Small Business Act, the guaranteed percentage was reduced from 95 percent to 90 percent in response to the Administration's concerns that the government's risk was too high at 95 percent.
Three. The size standard applicable for travel agencies with respect to disaster loans and emergency 7(a) loans under the managers' amendment is increased from $1 million to $2 million in average annual receipts.
Four. The SBA Administrator's authority to waive or increase size standards and size regulations is applied to both disaster loans and emergency 7(a) guaranteed loans.
Five. In order to encourage lenders to make the emergency and regular 7(a) loans to small businesses adversely affected by the effects of the terrorist attacks of September 11, 200l, the managers' amendment reduces the on-going lenders' fee from one-half of 1 percent to one-quarter of 1 percent.
Six. The requirement of non-Federal match is waived for the Women's Business Centers program with respect to individualized assistance authorized under this Act.
Seven. It requires the SBA to report to the pertinent House and Senate Committees periodically on its implementation of this legislation.
Eight. The managers' amendment increases the authorization levels for the 7(a) and 504 programs by $2 billion each, and for the Small Business Investment Company participating securities and debentures programs by $700 million and $200 million, respectively, to accommodate increased demand anticipated in the wake of the terrorist attacks of September 11, 2001.
Nine. In the loan term provisions for emergency 7(a) loans, a cap of $3 million was added for the ``gross amount of the loans.'' This clarifies that the other stated caps apply to the SBA -guaranteed portions of the loans.
Ten. To make clear that Congress expects the SBA to implement these emergency relief provisions as quickly as possible, a section was added requiring SBA to issue interim final rules and implementing guidelines within 20 days of the date of enactment of this legislation.
Eleven. Under the 7(a) stimulus loans, the managers' amendment reduces by half the upfront guarantee fee paid by the borrower, and it establishes a guarantee percentage of 85 percent on all such loans.
Twelve. Under 504 stimulus loans, the managers' amendment reduces by half the annual guarantee fee paid by the borrower, currently .41 percent, and retains the upfront bank fee of 50 basis points, .50 percent.
These are important changes that Senator Bond and I have worked out to make a good bill better. I am very pleased that the Chairman of the House Committee on Small Business, Congressman Don Manzullo, and Congressman Jim Moran introduced a bill identical to our managers' amendment on November 6 and appreciate their cooperation throughout this process.
