To provide assistance for small businesses damaged by Hurricane Katrina or Hurricane Rita, and for other purposes.

September 30, 2005

Ms. SNOWE (for herself, Mr. KERRY, Mr. VITTER, Ms. LANDRIEU, Mr. TALENT, Mr. KENNEDY, Mr. CORNYN, and Mr. BAYH) introduced the following bill; which was read twice and referred to the Committee on Small Business and Entrepreneurship

To provide assistance for small businesses damaged by Hurricane Katrina or Hurricane Rita, and for other purposes.

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

SECTION 1. SHORT TITLE; TABLE OF CONTENTS.

(a) Short Title- This Act may be cited as the `Small Business Hurricane Relief and Reconstruction Act of 2005'.

(b) Table of Contents- The table of contents for this Act is as follows:

Sec. 1. Short title; table of contents.

Sec. 2. Definitions.

Sec. 3. Disaster loans after Hurricane Katrina and Hurricane Rita.

Sec. 4. Energy emergency relief.

Sec. 5. Supplemental emergency loans.

Sec. 6. Development company debentures.

Sec. 7. Small business emergency relief.

Sec. 8. Business counseling.

Sec. 9. Small business development centers.

Sec. 10. HUBZones.

Sec. 11. Outreach programs.

Sec. 12. Small business bonding threshold.

Sec. 13. Small business participation.

Sec. 14. Micropurchases.

Sec. 15. Loan defaults.

Sec. 16. Budgetary treatment of loans and financings.

Sec. 17. Emergency procurement authority.

SEC. 2. DEFINITIONS.

In this Act--

(1) the terms `Administration' and `Administrator' mean the Small Business Administration and the Administrator thereof, respectively;

(2) the term `Disaster Area' means an area which the President has designated as a disaster area as a result of Hurricane Katrina of August 2005 or Hurricane Rita of September 2005; and

(3) the term `small business concern' has the same meaning as in section 3 of the Small Business Act.

SEC. 3. DISASTER LOANS AFTER HURRICANE KATRINA AND HURRICANE RITA.

(a) In a Disaster Area- Section 7(b) of the Small Business Act (15 U.S.C. 636(b)) is amended by inserting immediately after paragraph (3) the following:

`(4) DISASTER LOANS AFTER HURRICANE KATRINA AND HURRICANE RITA IN A DISASTER AREA-

`(A) DEFINITION- In this paragraph, the term `Disaster Area' means an area which the President has designated as a disaster area as a result of Hurricane Katrina of August 2005 or Hurricane Rita of September 2005.

`(B) LOANS TO NONPROFITS- In addition to any other loan authorized by this subsection, the Administrator may make such loans under this subsection (either directly or in cooperation with banks or other lending institutions through agreements to participate on an immediate or deferred basis) as the Administrator determines appropriate to a nonprofit organization located or operating in a Disaster Area or providing services to persons who have evacuated from a Disaster Area.

`(C) INCREASED LOAN CAPS-

`(i) AGGREGATE LOAN AMOUNTS- Except as provided in clause (ii), the aggregate loan amount outstanding and committed to a borrower under this subsection, except for loans under paragraph (5) or (6), made as a result of Hurricane Katrina or Hurricane Rita, may not exceed $10,000,000.

`(ii) WAIVER AUTHORITY- The Administrator may, at the discretion of the Administrator, waive the aggregate loan amount established under clause (i).

`(D) DEFERMENT OF DISASTER LOAN PAYMENTS-

`(i) IN GENERAL- Notwithstanding any other provision of law, payments of principal and interest on a loan to a borrower located in a Disaster Area made before August 24, 2007, shall be deferred, and no interest shall accrue with respect to such loan, during the time period described in clause (ii).

`(ii) TIME PERIOD- The time period for purposes of clause (i) shall be 1 year from the later of the date of enactment of this paragraph or the date of issuance of a loan described in clause (i), but may be extended to 2 years from such date, at the discretion of the Administrator.

`(iii) RESUMPTION OF PAYMENTS- At the end of the time period described in clause (ii), the payment of periodic installments of principal and interest shall be required with respect to such loan, in the same manner and subject to the same terms and conditions as would otherwise be applicable to any other loan made under this subsection.

`(E) REFINANCING DISASTER LOANS AFTER HURRICANE KATRINA AND HURRICANE RITA-

`(i) IN GENERAL- Any loan made under this subsection that was outstanding as to principal or interest on August 24, 2005, may be refinanced by a small business concern that is located in a Disaster Area, and the refinanced amount shall be considered to be part of the new loan for purposes of this subparagraph.

`(ii) NO EFFECT ON ELIGIBILITY- A refinancing under clause (i) by a small business concern shall be in addition to any other loan eligibility for that small business concern under this Act.

`(F) REFINANCING BUSINESS DEBT-

`(i) IN GENERAL- Any business debt of a small business concern that was outstanding as to principal or interest on August 24, 2005, may be refinanced by the small business concern if it is, or was on that date, located in a Disaster Area. With respect to a refinancing under this clause, payments of principal shall be deferred, and interest may accrue, during the 1-year period following the date of refinancing, and the refinanced amount shall be considered to be part of a new loan for purposes of this subparagraph.

`(ii) RESUMPTION OF PAYMENTS- At the end of the 1-year period described in clause (i), the payment of periodic installments of principal and interest shall be required with respect to such loan, in the same manner and subject to the same terms and conditions as would otherwise be applicable to any other loan made under this subsection.

`(G) TERMS- A loan under subparagraph (E) or (F) shall be made at the same interest rate as economic injury loans under paragraph (2).

`(H) EXTENDED APPLICATION PERIOD- Notwithstanding any other provision of law, the Administrator shall accept applications for assistance under this subsection as a result of Hurricane Katrina or Rita until 1 year after the date on which the President designated the area as a disaster area as a result of Hurricane Katrina or Hurricane Rita, as the case may be.

`(I) NO SALE- No loan under this subsection made as a result of Hurricane Katrina or Hurricane Rita may be sold.'.

(b) Nationwide Disaster Loans- Section 7(b) of the Small Business Act (15 U.S.C. 636(b)), as amended by this Act, is amended by inserting immediately after paragraph (4) the following:

`(5) NATIONWIDE LOANS AFTER HURRICANE KATRINA AND HURRICANE RITA- In addition to any other loan authorized by this subsection, the Administrator may make such loans under this subsection (either directly or in cooperation with banks or other lending institutions through agreements to participate on an immediate or deferred basis) as the Administrator determines appropriate to a small business concern, small agricultural cooperative, small nursery, or small producer cooperative located anywhere in the United States that demonstrates a direct adverse economic impact caused by Hurricane Katrina or Hurricane Rita, based on such criteria as the Administrator may set by rule, regulation, or order.'.

(c) Disaster Mitigation-

(1) IN GENERAL- Section 7(b)(1)(A) of the Small Business Act (15 U.S.C. 636(b)(1)(A)) is amended by inserting `of the aggregate costs of such damage or destruction (whether or not compensated for by insurance or otherwise)' after `20 per centum'.

(2) EFFECTIVE DATE- The amendment made by paragraph (1) shall apply with respect to a loan or guarantee made after the date of enactment of this Act.

(d) Technical Amendments- Section 7(b) of the Small Business Act (15 U.S.C. 636(b)) is amended--

(1) in the matter preceding paragraph (1), by striking `the, Administration' and inserting `the Administration';

(2) in paragraph (2)(A), by striking `Disaster Relief and Emergency Assistance Act' and inserting `Robert T. Stafford Disaster Relief and Emergency Assistance Act (42 U.S.C. 5121 et seq.)'; and

(3) in the undesignated matter at the end--

(A) by striking `, (2), and (4)' and inserting `and (2)'; and

(B) by striking `, (2), or (4)' and inserting `(2)'.

(e) Disaster Loan Additional Amounts- In addition to any other amounts otherwise appropriated for such purpose, there is authorized to be appropriated to the Administration $86,000,000, to make loans under section 7(b) of the Small Business Act.

SEC. 4. ENERGY EMERGENCY RELIEF.

(a) Small Business and Farm Energy Emergency Disaster Loan Program-

(1) SMALL BUSINESS DISASTER LOAN AUTHORITY- Section 7(b) of the Small Business Act (15 U.S.C. 636(b)) is amended by inserting immediately after paragraph (5), as added by this Act, the following:

`(6) ENERGY EMERGENCY RELIEF-

`(A) DEFINITIONS- For purposes of this paragraph--

`(i) the term `base price index' means the moving average of the closing unit price on the New York Mercantile Exchange for heating oil, natural gas, gasoline, or propane for the 10 days, in each of the most recent 2 preceding years, which correspond to the trading days described in clause (ii);

`(ii) the term `current price index' means the moving average of the closing unit price on the New York Mercantile Exchange, for the 10 most recent trading days, for contracts to purchase heating oil, natural gas, gasoline, or propane during the subsequent calendar month, commonly known as the `front month';

`(iii) the term `significant increase' means--

`(I) with respect to the price of heating oil, natural gas, gasoline, or propane, any time the current price index exceeds the base price index by not less than 40 percent; and

`(II) with respect to the price of kerosene, any increase which the Administrator, in consultation with the Secretary of Energy, determines to be significant; and

`(iv) a small business concern engaged in the heating oil business is eligible for a loan, if the small business concern sells not more than 10,000,000 gallons of heating oil per year.

`(B) LOAN AUTHORITY- The Administration may make such loans, either directly or in cooperation with banks or other lending institutions through agreements to participate on an immediate or deferred basis, to assist a small business concern that has suffered or that is likely to suffer substantial economic injury on or after August 24, 2005, as the result of a significant increase in the price of heating oil, natural gas, gasoline, propane, or kerosene occurring on or after August 24, 2005.

`(C) APPLICABLE INTEREST RATE- Any loan or guarantee extended pursuant to this paragraph shall be made at the same interest rate as economic injury loans under paragraph (2).

`(D) LOAN LIMITATION- No loan may be made under this paragraph, either directly or in cooperation with banks or other lending institutions through agreements to participate on an immediate or deferred basis, if the total amount outstanding and committed to the borrower under this subsection would exceed $1,500,000, unless such borrower constitutes a major source of employment in its surrounding area, as determined by the Administrator, in which case the Administrator, in its discretion, may waive the $1,500,000 limitation.

`(E) LOAN CRITERIA- For purposes of assistance under this paragraph--

`(i) a declaration of a disaster area based on conditions specified in this paragraph shall be required, and shall be made by the President or the Administrator; or

`(ii) if no declaration has been made pursuant to clause (i), the Governor of a State in which a significant increase in the price of heating oil, natural gas, gasoline, propane, or kerosene has occurred may certify to the Administration that small business concerns have suffered economic injury as a result of such increase and are in need of financial assistance which is not otherwise available on reasonable terms in that State, and upon receipt of such certification, the Administration may make such loans as would have been available under this paragraph if a disaster declaration had been issued.

`(F) PERMISSIBLE USES- Notwithstanding any other provision of law, loans made under this paragraph may be used by a small business concern described in subparagraph (B) to convert from the use of heating oil, natural gas, gasoline, propane, or kerosene to a renewable or alternative energy source, including agriculture and urban waste, geothermal energy, cogeneration, solar energy, wind energy, or fuel cells.'.

(2) CONFORMING AMENDMENTS- Section 3(k) of the Small Business Act (15 U.S.C. 632(k)) is amended--

(A) by inserting `, significant increase in the price of heating oil, natural gas, gasoline, propane, or kerosene' after `civil disorders'; and

(B) by inserting `other' before `economic'.

(3) REPORT- Not later than 12 months after the date on which the Administrator issues guidelines under subsection (c)(1), and annually thereafter, until the date that is 12 months after the end of the effective period of section 7(b)(6) of the Small Business Act, as added by this subsection, the Administrator shall submit to the Committee on Small Business and Entrepreneurship of the Senate and the Committee on Small Business of the House of Representatives, a report on the effectiveness of the assistance made available under section 7(b)(6) of the Small Business Act, as added by this subsection, including--

(A) the number of small business concerns that applied for a loan under that section 7(b)(6) and the number of those that received such loans;

(B) the dollar value of those loans;

(C) the States in which the small business concerns that received such loans are located;

(D) the type of energy that caused the significant increase in the cost for the participating small business concerns; and

(E) recommendations for ways to improve the assistance provided under that section 7(b)(6), if any.

(4) EFFECTIVE DATE- The amendments made by this subsection shall apply during the 4-year period beginning on the earlier of the date on which guidelines are published by the Administrator under subsection (c)(1), or 30 days after the date of enactment of this Act, with respect to assistance under section 7(b)(6) of the Small Business Act, as added by this subsection.

(b) Farm Energy Emergency Relief-

(1) IN GENERAL- Section 321(a) of the Consolidated Farm and Rural Development Act (7 U.S.C. 1961(a)) is amended--

(A) in the first sentence--

(i) by striking `operations have' and inserting `operations (i) have'; and

(ii) by inserting before `: Provided,' the following: `, or (ii)(I) are owned or operated by such an applicant that is also a small business concern (as defined in section 3 of the Small Business Act (15 U.S.C. 632)), and (II) have suffered or are likely to suffer substantial economic injury on or after August 24, 2005, as the result of a significant increase in energy costs or input costs from energy sources occurring on or after August 24, 2005, in connection with an energy emergency declared by the President or the Secretary';

(B) in the third sentence, by inserting before the period at the end the following: `or by an energy emergency declared by the President or the Secretary'; and

(C) in the fourth sentence--

(i) by inserting `or energy emergency' after `natural disaster' each place that term appears; and

(ii) by inserting `or declaration' after `emergency designation'.

(2) FUNDING- Funds available on the date of enactment of this Act for emergency loans under subtitle C of the Consolidated Farm and Rural Development Act (7 U.S.C. 1961 et seq.) shall be available to carry out the amendments made by paragraph (1) to meet the needs resulting from natural disasters.

(3) REPORT- Not later than 12 months after the date on which the Secretary of Agriculture issues guidelines under subsection (c)(1), and annually thereafter, the Secretary shall submit to the Committee on Small Business and Entrepreneurship and the Committee on Agriculture, Nutrition, and Forestry of the Senate and to the Committee on Small Business and the Committee on Agriculture of the House of Representatives, a report that--

(A) describes the effectiveness of the assistance made available under section 321(a) of the Consolidated Farm and Rural Development Act (7 U.S.C. 1961(a)), as amended by this section; and

(B) contains recommendations for ways to improve the assistance provided under such section 321(a).

(4) EFFECTIVE DATE- The amendments made by this subsection shall apply during the 4-year period beginning on the earlier of the date on which guidelines are published by the Secretary of Agriculture under subsection (c)(1), or 30 days after the date of enactment of this Act, with respect to assistance under section 321(a) of the Consolidated Farm and Rural Development Act (7 U.S.C. 1961(a)), as amended by this subsection.

(c) Guidelines and Rulemaking-

(1) GUIDELINES- Not later than 30 days after the date of enactment of this Act, the Administrator and the Secretary of Agriculture shall each issue guidelines to carry out subsections (a) and (b), respectively, and the amendments made thereby, which guidelines shall become effective on the date of their issuance.

(2) RULEMAKING- Not later than 30 days after the date of enactment of this Act, the Administrator, after consultation with the Secretary of Energy, shall promulgate regulations specifying the method for determining a significant increase in the price of kerosene under section 7(b)(6)(A)(iii)(II) of the Small Business Act, as added by this Act.

SEC. 5. SUPPLEMENTAL EMERGENCY LOANS.

(a) In General- Section 7(a) of the Small Business Act (15 U.S.C. 636(a)) is amended by adding at the end the following:

`(32) SUPPLEMENTAL EMERGENCY LOANS AFTER HURRICANE KATRINA AND HURRICANE RITA-

`(A) LOAN AUTHORITY- In addition to any other loan authorized by this subsection, the Administrator shall make such loans under this subsection (either directly or in cooperation with banks or other lending institutions through agreements to participate on an immediate or deferred basis) as the Administrator determines appropriate to a small business concern, located anywhere in the United States, that is directly adversely affected by Hurricane Katrina or Hurricane Rita, based on such criteria as the Administrator may set by rule, regulation, or order, subject to subparagraph (B).

`(B) OVERSIGHT PROTECTIONS- In making any loan under subparagraph (A)--

`(i) the borrower shall be made aware that such loans are for those directly adversely affected by Hurricane Katrina or Hurricane Rita, as the case may be; and

`(ii) if such loans are made in cooperation with a bank or other lending institution--

`(I) lenders shall document for the Administrator how the borrower was directly adversely affected by Hurricane Katrina or Hurricane Rita;

`(II) not later than 6 months after the date of enactment of this paragraph, and every 6 months thereafter until the date that is 18 months after the date of enactment of this paragraph, the Inspector General of the Administration shall make a report regarding such loans to the Committee on Small Business and Entrepreneurship of the Senate and the Committee on Small Business of the House of Representatives, including verification that the program is being administered appropriately and that such loans are being used for purposes authorized by this paragraph; and

`(III) not later than 12 months after the date on which the final report submitted by the Inspector General under subclause (II), the Comptroller General of the United States shall conduct a review of the administration of the supplemental emergency loan program authorized under this paragraph and submit a report to the Committee on Small Business and Entrepreneurship of the Senate and the Committee on Small Business of the House of Representatives containing the findings of the review and any recommendations.

`(C) FEES-

`(i) IN GENERAL- Notwithstanding any other provision of law, the Administrator shall, in lieu of the fee established under paragraph (23)(A), collect an annual fee of 0.25 percent of the outstanding balance of deferred participation loans made under this subsection to a small business concern, located anywhere in the United States, directly adversely affected by Hurricane Katrina or Hurricane Rita for a period of 1 year after the date of enactment of this paragraph.

`(ii) GUARANTEE FEES- Notwithstanding any other provision of law, the guarantee fee under paragraph (18)(A) for a period of 1 year after the date of enactment of this subparagraph shall be as follows:

`(I) A guarantee fee equal to 1 percent of the deferred participation share of a total loan amount that is not more than $150,000.

`(II) A guarantee fee equal to 2.5 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 3.5 percent of the deferred participation share of a total loan amount that is more than $700,000.'.

(b) Authorization of Appropriations- There is authorized to be appropriated $75,000,000 to carry out section 7(a)(32) of the Small Business Act, as added by this section.

SEC. 6. DEVELOPMENT COMPANY DEBENTURES.

(a) Authority- Section 503 of the Small Business Investment Act of 1958 (15 U.S.C. 697) is amended by adding at the end the following:

`(j) Debentures After Hurricane Katrina and Hurricane Rita-

`(1) AUTHORITY-

`(A) IN GENERAL- In addition to any other guarantee authorized by this section, the Administrator may guarantee the timely payment of all principal and interest as scheduled on any debenture issued to a qualified borrower.

`(B) TERMS- The Administrator shall establish a fee for a guarantee issued under subparagraph (A) that is lower than that for other guarantees under this section.

`(2) EXISTING GUARANTEES-

`(A) IN GENERAL- Notwithstanding any other provision of law, the Administrator may temporarily defer payments of principal and interest on a guarantee made under this section before the date of enactment of this subsection to a qualified borrower located in a Disaster Area, in any case in which the payments are owed to the Administration.

`(B) PAYMENTS TO OTHER PARTIES- Notwithstanding any other provision of law, the Administrator may temporarily make payments of principal and interest on a loan made under this section before the date of enactment of this subsection to a qualified borrower located in a Disaster Area, in any case in which the payments are owed to a person other than the Administration.

`(C) TERMINATION OF AUTHORITY- The authority to defer, or make, payments under this paragraph shall terminate 1 year after the date of enactment of this subsection.

`(3) DEFINITIONS- In this subsection, the following definitions shall apply:

`(A) DISASTER AREA- The term `Disaster Area' means an area which the President has designated as a disaster area as a result of Hurricane Katrina of August 2005 or Hurricane Rita of September 2005.

`(B) QUALIFIED BORROWER- The term `qualified borrower' means a small business concern located anywhere in the United States that has been directly adversely affected by Hurricane Katrina or Hurricane Rita, based on such criteria as the Administrator may set by rule, regulation, or order.'.

(b) Authorization of Appropriations- There is authorized to be appropriated $75,000,000 to carry out section 503(j) of the Small Business Investment Act of 1958, as added by this section.

SEC. 7. SMALL BUSINESS EMERGENCY RELIEF.

(a) Business Loan Programs- Section 20(e)(1)(B) of the Small Business Act (15 U.S.C. 631 note) is amended--

(1) in the matter preceding clause (i), by striking `$25,050,000,000' and inserting `$40,050,000,000';

(2) in clause (i), by striking `$17,000,000,000' and inserting `$27,000,000,000'; and

(3) in clause (ii), by striking `$7,500,000,000' and inserting `$12,500,000,000'.

(b) Grants to States Damaged by Hurricane Katrina or Hurricane Rita-

(1) IN GENERAL- There is authorized to be appropriated to the Secretary of Commerce $450,000,000 for the Economic Development Administration of the Department of Commerce to make grants to the appropriate State government agencies in Louisiana, Alabama, Mississippi, Texas, and Florida, to carry out this subsection.

(2) DISBURSEMENT OF FUNDS- The Department of Commerce shall disburse the funds authorized under paragraph (1) in the most expeditious manner possible to the designated States, based on--

(A) the number of businesses directly damaged or disrupted by Hurricane Katrina or Hurricane Rita in the State;

(B) the number of residents displaced from the State by Hurricane Katrina or Hurricane Rita;

(C) the number of jobs lost or disrupted by Hurricane Katrina or Hurricane Rita in the State;

(D) the extent of economic disruption by Hurricane Katrina or Hurricane Rita in the State; and

(E) the number of evacuees from any other State due to Hurricane Katrina or Hurricane Rita to whom the designated State is providing assistance.

(3) USE OF FUNDS-

(A) IN GENERAL- Grants awarded to a State under paragraph (1) shall be used by the State to provide bridge grants and loans, which may be made to any person located in a Disaster Area who was directly adversely affected by Hurricane Katrina or Hurricane Rita, to assist such person in covering costs until the person is able to obtain loans through Administration assistance programs or other sources.

(B) REIMBURSEMENT- A State may use a grant awarded under paragraph (1) as reimbursement for any State funds used to provide bridge grants or loans to any person located in a Disaster Area who was directly adversely affected by Hurricane Katrina or Hurricane Rita before the date on which the funds authorized under paragraph (1) are disbursed.

(C) CRITERIA- Notwithstanding any other provision of law, in making bridge grants and loans under subparagraph (A), the State may use such criteria as the State determines appropriate, and shall not be required to apply eligibility criteria for programs administered by the Department of Commerce.

(D) TERMS- For any loan made by a State under subparagraph (A)--

(i) such a loan may initially be a noncollateralized, low-interest loan;

(ii) payments and interest on such a loan may be deferred for at least 1 year after the date on which the loan is made;

(iii) the balance remaining on such a loan 5 years after the date on which the loan is made may be forgiven entirely by the State, if the borrower has continued to operate during that 5-year period in a Disaster Area; and

(iv) such a loan may be forgiven by the State, under such terms as it may set, if the borrower cannot repay such loan.

(E) ADMINISTRATIVE EXPENSES- The Department of Commerce may use not more than $1,000,000 of the funds authorized under paragraph (1) to administer the provision of grants to the designated States under this subsection.

SEC. 8. BUSINESS COUNSELING.

In addition to any other amounts authorized for any fiscal year, there are authorized to be appropriated to the Administration, to remain available until expended, for fiscal year 2006--

(1) $21,000,000, to be used for activities of small business development centers pursuant to section 21 of the Small Business Act, not less than $15,000,000 of which shall be non-matching funds and used to aid and assist small business concerns affected by Hurricane Katrina or Hurricane Rita;

(2) $2,000,000, to be used for the SCORE program authorized by section 8(b)(1) of the Small Business Act, for the activities described in section 8(b)(1)(B)(ii) of that Act, not less than $1,000,000 of which shall be used to aid and assist small business concerns affected by Hurricane Katrina or Hurricane Rita;

(3) $4,500,000, to be used for activities of women's business centers authorized by section 29(b) of the Small Business Act and for recipients of a grant under section 29(l) of that Act, not less than $2,500,000 of which shall be non-matching funds used to aid and assist small business concerns affected by Hurricane Katrina or Hurricane Rita, which may also be made available to a women's business center whose 5-year project ended in fiscal year 2004;

(4) $1,250,000, to be used for activities of the office of veteran's business development pursuant to section 32 of the Small Business Act, not less than $750,000 of which shall be used to aid and assist small business concerns affected by Hurricane Katrina or Hurricane Rita; and

(5) $5,000,000, to be used for activities of the microloan program authorized by clauses (ii) and (iii) of section 7(m)(1)(G) of the Small Business Act to aid and assist small business concerns adversely affected by Hurricane Katrina or Hurricane Rita.

SEC. 9. SMALL BUSINESS DEVELOPMENT CENTERS.

(a) Waiver of Maximum Amount- Section 21(a)(4) of the Small Business Act (15 U.S.C. 648(a)(4)) is amended by adding at the end the following:

`(D) FISCAL YEARS 2005 AND 2006- For fiscal years 2005 and 2006, the Administrator has the authority to waive the maximum amount of $100,000 for grants under subparagraph (C)(viii), and such grants shall be made available for small business development centers assisting small business concerns adversely affected by Hurricane Katrina or Hurricane Rita.'.

(b) Assistance After Hurricane Katrina and Hurricane Rita- Section 21(b) of the Small Business Act (15 U.S.C. 648(b)) is amended by adding at the end the following:

`(4) Assistance after hurricane katrina and hurricane rita-

`(A) IN GENERAL- The Administration shall authorize any small business development center, regardless of location, to provide advice, information, and assistance, as described in subsection (c), to a small business concern located in an area which the President has designated as a disaster area as a result of Hurricane Katrina of August 2005 or Hurricane Rita of September 2005.

`(B) CONTINUITY OF SERVICES- A small business development center that provides counselors to an area described in subparagraph (A) shall, to the maximum extent practicable, ensure continuity of services in the State it currently serves.'.

SEC. 10. HUBZONES.

Section 3(p)(1) of the Small Business Act (15 U.S.C. 632(p)(1)) is amended--

(1) in subparagraph (D), by striking `or';

(2) in subparagraph (E), by striking the period at the end and inserting `; or'; and

(3) by adding at the end the following:

`(F) an area which the President has designated as a disaster area as a result of Hurricane Katrina of August 2005 or Hurricane Rita of September 2005.'.

SEC. 11. OUTREACH PROGRAMS.

(a) In General- Not later than 90 days after the date of enactment of this Act, the Administrator shall establish a contracting outreach and technical assistance program for small business concerns which have had a primary place of business in, or other significant presence in a Disaster Area at any time following the 60 days prior to the designation of such area by the Administrator.

(b) Administrator Action- The Administrator may fulfill the requirement of subsection (a) by acting through--

(1) the Administration;

(2) the Federal agency small business officials designated under section 15(k)(1) of the Small Business Act (15 U.S.C. 644(k)(1)); or

(3) any Federal, State, or local government entity, higher education institution, or private nonprofit organization that the Administrator may deem appropriate, upon conclusion of a memorandum of understanding or assistance agreement, as appropriate, with the Administrator.

SEC. 12. SMALL BUSINESS BONDING THRESHOLD.

Notwithstanding any other provision of law, for all procurements related to Hurricane Katrina or Hurricane Rita, the Administrator may, upon such terms and conditions as it may prescribe, guarantee and enter into commitments to guarantee any surety against loss resulting from a breach of the terms of a bid bond, payment bond, performance bond, or bonds ancillary thereto, by a principal on any total work order or contract amount at the time of bond execution that does not exceed $5,000,000, except that the Administrator may increase such amount to $10,000,000, at the discretion of the Administrator.

SEC. 13. SMALL BUSINESS PARTICIPATION.

In order to facilitate the maximum practicable participation of small business concerns in activities related to relief and recovery from Hurricane Katrina and Hurricane Rita, the Administrator and the head of any Federal agency making procurements related to the aftermath of Hurricane Katrina or Hurricane Rita, shall set a goal, to be met within a reasonable time, of awarding to small business concerns not less than 30 percent of amounts expended for prime contracts and not less than 40 percent of amounts expended for subcontracts on procurements by such agency related to the aftermath of Hurricane Katrina or Hurricane Rita, respectively.

SEC. 14. MICROPURCHASES.

(a) In General- Section 101 of the Second Emergency Supplemental Appropriations Act to Meet Immediate Needs Arising From the Consequences of Hurricane Katrina, 2005 (Public Law 109-62; 119 Stat. 1990) is repealed.

(b) Authority- The authority provided in subsection 32A of the Office of Federal Procurement Policy Act (41 U.S.C. 428a) may be used with respect to any procurement for property or services determined by the head of an Executive agency to be necessary for support of Hurricane Katrina or Hurricane Rita rescue and relief operations.

(c) Expiration- The authority provided by subsection (b) shall expire on the date that is 180 days after the date of enactment of this Act.

SEC. 15. LOAN DEFAULTS.

Notwithstanding any other provision of law, no loan made before August 24, 2005, under subsection (a) or (m) of section 7 of the Small Business Act or title III or section 503 of the Small Business Investment Act of 1958 for which the borrower goes into default because of Hurricane Katrina or Hurricane Rita shall be considered a cost, as that term is defined in section 502 of the Federal Credit Reform Act of 1990, to the Administration for purposes of calculating the subsidy rate for loans under subsection (a) or (m) of section 7 of the Small Business Act or title III or section 503 of the Small Business Investment Act of 1958, respectively.

SEC. 16. BUDGETARY TREATMENT OF LOANS AND FINANCINGS.

(a) In General- Assistance made available under any loan made or approved by the Administration under this Act, subsections (a) or (b) of section 7 of the Small Business Act (15 U.S.C. 636(a)), as amended by this Act, or financings made under title V of the Small Business Investment Act of 1958 (15 U.S.C. 695 et seq.), as amended by this Act, on and after the date of enactment of this Act, shall be treated as separate programs of the Administration for purposes of the Federal Credit Reform Act of 1990 only.

(b) Use of Funds- Assistance under this Act and the amendments made by this Act shall be available only to the extent that funds are made available under appropriations Acts, which funds shall be utilized to offset the cost (as such term is defined in section 502 of the Federal Credit Reform Act of 1990) of such assistance.

SEC. 17. EMERGENCY PROCUREMENT AUTHORITY.

(a) Small Business Reservation Offset- Section 15(j) of the Small Business Act (15 U.S.C. 644(j)) is amended by adding at the end the following:

`(4) For any contracts involving the use of the special emergency procurement authority under section 32A(c) of the Office of Federal Procurement Policy Act (41 U.S.C. 428a(c)), the dollar ceiling of the small business reservation established in paragraph (1) shall be adjusted to match the applicable amount of the simplified acquisition threshold.'.

(b) Retention of Small Business Subcontracting- Section 8(d)(4)(D) of the Small Business Act (15 U.S.C. 637(d)(4)(D)) is amended--

(1) by striking `(D) No contract' and inserting the following:

`(D) SMALL BUSINESS PARTICIPATION-

`(i) IN GENERAL- No contract'; and

(2) by adding at the end the following:

`(ii) EMERGENCY PROCUREMENTS-

`(I) IN GENERAL- For any contract which otherwise meets the requirements of this subsection, and which involves the use of special emergency procurement authority under section 32A(c) of the Office of Federal Procurement Policy Act (41 U.S.C. 428a(c)), the subcontracting plan required under this subsection shall be negotiated as soon as is practicable, but not later than 30 days after the date on which the contract is awarded.

`(II) PAYMENT- Not greater than 50 percent of the amounts due under any contract described in subclause (I) may be paid, unless a subcontracting plan compliant with this subsection is negotiated by the contractor.'.

END