To provide emergency relief to small business concerns affected by a significant increase in the price of heating oil, natural gas, propane, or kerosene, and for other purposes.

February 2, 2005

Mr. KERRY (for himself, Mr. REED, Mr. DODD, Mr. BINGAMAN, Mr. KOHL, Mr. JEFFORDS, Ms. CANTWELL, Mr. JOHNSON, Mr. PRYOR, Mr. LEAHY, Mr. LEVIN, Mr. SCHUMER, Mr. LIEBERMAN, Mrs. CLINTON, Mr. HARKIN, Mr. KENNEDY, Mr. BAYH, and Mr. OBAMA) introduced the following bill; which was read twice and referred to the Committee on Small Business and Entrepreneurship

To provide emergency relief to small business concerns affected by a significant increase in the price of heating oil, natural gas, propane, or kerosene, 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.

This Act may be cited as the `Small Business and Farm Energy Emergency Relief Act of 2005'.

SEC. 2. FINDINGS.

Congress finds that--

(1) a significant number of small businesses in the United States, non-farm as well as agricultural producers, use heating oil, natural gas, propane, or kerosene to heat their facilities and for other purposes;

(2) a significant number of small business concerns in the United States sell, distribute, market, or otherwise engage in commerce directly related to heating oil, natural gas, propane, and kerosene; and

(3) significant increases in the price of heating oil, natural gas, propane, or kerosene--

(A) disproportionately harm small businesses dependent on those fuels or that use, sell, or distribute those fuels in the ordinary course of their business, and can cause them substantial economic injury;

(B) can negatively affect the national economy and regional economies;

(C) have occurred in the winters of 1983-1984, 1988-1989, 1996-1997, 1999-2000, 2000-2001, and 2004-2005; and

(D) can be caused by a host of factors, including international conflicts, global or regional supply difficulties, weather conditions, insufficient inventories, refinery capacity, transportation, and competitive structures in the markets, causes that are often unforeseeable to, and beyond the control of, those who own and operate small businesses.

SEC. 3. SMALL BUSINESS ENERGY EMERGENCY DISASTER LOAN PROGRAM.

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

`(4)(A) In 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, 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, or propane during the subsequent calendar month, commonly known as the `front month';

`(iii) the term `heating fuel' means heating oil, natural gas, propane, or kerosene; and

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

`(I) with respect to the price of heating oil, natural gas, 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.

`(B) 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 as the result of a significant increase in the price of heating fuel.

`(C) 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) 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 Administration, in which case the Administration, in its discretion, may waive the $1,500,000 limitation.

`(E) 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 fuel 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) 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 fuel to a renewable or alternative energy source, including agriculture and urban waste, geothermal energy, cogeneration, solar energy, wind energy, or fuel cells.'.

(b) Conforming Amendments Relating to Heating Fuel- Section 3(k) of the Small Business Act (15 U.S.C. 632(k)) is amended--

(1) by inserting `, significant increase in the price of heating fuel' after `civil disorders'; and

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

SEC. 4. AGRICULTURAL PRODUCER EMERGENCY LOANS.

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

(1) in the first sentence--

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

(B) 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 October 1, 2004, as the result of a significant increase in energy costs or input costs from energy sources occurring on or after October 1, 2004, in connection with an energy emergency declared by the President or the Secretary';

(2) 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

(3) in the fourth sentence--

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

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

(b) 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 subsection (a) to meet the needs resulting from natural disasters.

SEC. 5. GUIDELINES AND RULEMAKING.

(a) Guidelines- Not later than 30 days after the date of enactment of this Act, the Administrator of the Small Business Administration and the Secretary of Agriculture shall each issue such guidelines as the Administrator or the Secretary, as applicable, determines to be necessary to carry out this Act and the amendments made by this Act.

(b) Rulemaking- Not later than 30 days after the date of enactment of this Act, the Administrator of the Small Business Administration, 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)(4)(A)(iv)(II) of the Small Business Act (15 U.S.C. 636(b)(4)(A)(iv)(II)).

SEC. 6. REPORTS.

(a) Small Business Administration- Not later than 12 months after the date on which the Administrator of the Small Business Administration issues guidelines under section 5, and annually thereafter, 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)(4) of the Small Business Act, as added by this Act, including--

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

(2) the dollar value of those loans;

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

(4) the type of heating fuel or energy that caused the significant increase in the cost for the participating small business concerns; and

(5) recommendations for ways to improve the assistance provided under such section 7(b)(4), if any.

(b) Department of Agriculture- Not later than 12 months after the date on which the Secretary of Agriculture issues guidelines under section 5, and annually thereafter, the Secretary shall submit to the Committee on Small Business and Agriculture, Nutrition, and Forestry of the Senate and the Committee on Small Business and Agriculture of the House of Representatives, a report that--

(1) describes the effectiveness of the assistance made available under section 7(b)(4) of the Small Business Act (15 U.S.C. 636(b)(4)); and

(2) contains recommendations for ways to improve the assistance provided under such section 7(b)(4), if any.

SEC. 7. EFFECTIVE DATE.

(a) Small Business- The amendments made by this Act shall apply during the 4-year period beginning on the date on which guidelines are published by the Administrator of the Small Business Administration under section 5, with respect to assistance under section 7(b)(4) of the Small Business Act, as added by this Act, to economic injury suffered or likely to be suffered as the result of a significant increase in the price of heating fuel occurring on or after October 1, 2004; or

(b) Agriculture- The amendments made by section 4 shall apply during the 4-year period beginning on the date on which guidelines are published by the Secretary of Agriculture under section 5.

END