To amend the Small Business Act to establish a temporary loan program and a temporary vocational development program for small business concerns owned and controlled by veterans.

November 7, 2003

Mr. UDALL of New Mexico (for himself and Mrs. KELLY) introduced the following bill; which was referred to the Committee on Small Business

To amend the Small Business Act to establish a temporary loan program and a temporary vocational development program for small business concerns owned and controlled by veterans.

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 `Seeds for Soldiers Act'.

SEC. 2. TEMPORARY LOAN PROGRAM FOR SMALL BUSINESS CONCERNS OWNED AND CONTROLLED BY VETERANS.

(a) IN GENERAL- The Administrator of the Small Business Administration may make loans under section 7(a) of the Small Business Act (15 U.S.C. 636(a)) to small business concerns owned and controlled by veterans.

(b) SPECIAL RULES- Notwithstanding the requirements of section 7 of the Small Business Act (15 U.S.C. 636), the following special rules apply to loans described in subsection (a):

(1) PURPOSE OF LOANS- The Administrator may make such loans for any business purpose, including the refinancing of any outstanding business debt.

(2) DEFERRAL OF PAYMENTS WITHOUT INTEREST- No payment of principal on any such loan shall be due or payable during the 1-year period beginning on the date that such loan is issued. Any interest payable with respect to such loan for such period shall be paid by the Administration.

(3) AMOUNT OF LOANS- Any such loan may be made if the total amount outstanding and committed to the borrower under section 7(a) of the Small Business Act (15 U.S.C. 636(a)) would not exceed $3,000,000.

(4) GUARANTEED LOANS- In the case of an agreement to participate on a deferred basis in any such loan--

(A) PARTICIPATION- Such participation by the Administration shall be equal to 90 percent of the balance of the financing outstanding at the time of disbursement of the loan.

(B) GUARANTEE FEES- The Administrator shall collect (except in the case of a loan that is repayable in 1 year or less) a guarantee fee, which shall be payable by the participating lender, and may be charged to the borrower as follows:

(i) A guarantee fee equal to 0.5 percent of the deferred participation share of a total loan amount that is not more than $150,000.

(ii) A guarantee fee equal to 1.5 percent of the deferred participation share of a total loan amount that is more than $150,000, but not more than $700,000.

(iii) A guarantee fee equal to 2 percent of the deferred participation share of a total loan amount that is more than $700,000.

(C) ANNUAL FEES- The annual fee assessed and collected on any such loan shall not exceed an amount equal to 0.15 percent of the outstanding balance of the deferred participation share of the loan.

(5) CREDIT ELSEWHERE- The Administrator may make such loans without regard to the ability of a small business concern to obtain credit elsewhere.

(6) COLLATERAL- The Administrator shall make such loans without regard to the availability of collateral to secure such loans.

(c) TERMINATION- The Administrator shall not make any loan under this section after December 31, 2005.

(d) DEFINITIONS- For purpose of this section, the terms `Administrator', `Administration', `credit elsewhere', and `small business concern owned and controlled by veterans' have the respective meanings given such terms in section 3 of the Small Business Act (15 U.S.C. 632), except as provided in subsection (b)(8).

(e) AUTHORIZATION OF APPROPRIATIONS- There is authorized to be appropriated to carry out this section $25,000,000 for fiscal year 2004. Such sum shall remain available until expended.

SEC. 3. TEMPORARY VOCATIONAL DEVELOPMENT PROGRAM FOR VETERANS.

(a) ESTABLISHMENT- In accordance with this section, the Administrator of the Small Business Administration shall make grants to small business development centers to enable such centers to provide to veterans a program of assistance that includes training in a vocational or technical trade and entrepreneurial assistance in establishing and operating a small business concern that provides services in such trade.

(b) MINIMUM GRANT- The Administrator shall not make a grant under this section for an amount less than $500,000.

(c) APPLICATION AND AWARD- Each small business development center seeking a grant under this section shall submit to the Administrator an application in such form as the Administrator may require. The application shall include information regarding the applicant's goals and objectives for the program of assistance described in subsection (a). In awarding the grants, the Administrator shall consider the needs of the area served by the small business development center, including whether the small business development center is located in the proximity of a United States military installation.

(d) TERMINATION- The Administrator shall not make any grant under this section after December 31, 2005.

(e) COORDINATION WITH SMALL BUSINESS ACT- Grants made under this section shall not be taken into account for purposes of section 21 of the Small Business Act (15 U.S.C. 648).

(f) DEFINITIONS- For purposes of this section:

(1) ADMINISTRATOR- The term `Administrator' means the Administrator of the Small Business Administration.

(2) SMALL BUSINESS DEVELOPMENT CENTER- The term `small business development center' means a small business development center described in section 21 of the Small Business Act (15 U.S.C. 648).

(3) VETERAN- The term `veteran' has the meaning given such term in section 3(q)(4) of the Small Business Act (15 U.S.C. 632(q)(4)).

(g) AUTHORIZATION OF APPROPRIATIONS- There is authorized to be appropriated to carry out this section $25,000,000 for fiscal year 2004. Such sum shall remain available until expended.

END