To provide emergency assistance to nonfarm-related small business concerns that have suffered substantial economic harm from drought.

February 5, 2003

Mr. Kerry (for himself, Mr. Bond, Ms. Landrieu, Mr. Edwards, Mr. Johnson, Mr. Bingaman, Mr. Levin, Mr. Baucus, Mr. Daschle, Mr. Hollings, Mr. Lieberman, Mr. Warner, Mr. Crapo, Mr. Harkin, and Mr. Reid) introduced the following bill; which was read twice and referred to the Committee on Small Business and Entrepreneurship

To provide emergency assistance to nonfarm-related small business concerns that have suffered substantial economic harm from drought.

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

SECTION 1. LOANS TO SMALL BUSINESS CONCERNS DAMAGED BY DROUGHT.

(a) SHORT TITLE- This Act may be cited as the `Small Business Drought Relief Act of 2003'.

(b) FINDINGS- Congress finds that--

(1) as of July 2002, more than 36 States (including Massachusetts, South Carolina, and Louisiana) have suffered from continuing drought conditions;

(2) droughts have a negative effect on State and regional economies;

(3) many small businesses in the United States sell, distribute, market, or otherwise engage in commerce related to water and water sources, such as lakes, rivers, and streams;

(4) many small businesses in the United States suffer economic injury from drought conditions, leading to revenue losses, job layoffs, and bankruptcies;

(5) these small businesses need access to low-interest loans for business-related purposes, including paying their bills and making payroll until business returns to normal;

(6) absent a legislative change, the practice of the Small Business Administration of permitting only agriculture and agriculture-related businesses to be eligible for Federal disaster loan assistance as a result of drought conditions would likely continue;

(7) during the past several years small businesses that rely on the Great Lakes have suffered economic injury as a result of lower than average water levels, resulting from low precipitation and increased evaporation, and there are concerns that small businesses in other regions could suffer similar hardships beyond their control and that they should also be eligible for assistance; and

(8) it is necessary to amend the Small Business Act to clarify that nonfarm-related small businesses that have suffered economic injury from drought are eligible to receive financial assistance through Small Business Administration Economic Injury Disaster Loans.

(c) DROUGHT DISASTER AUTHORITY-

(1) DEFINITION OF DISASTER- Section 3(k) of the Small Business Act (15 U.S.C. 632(k)) is amended--

(A) by inserting `(1)' after `(k)'; and

(B) by adding at the end the following:

`(2) For purposes of section 7(b)(2), the term `disaster' includes--

`(A) drought; and

`(B) below average water levels in the Great Lakes, or on any body of water in the United States that supports commerce by small business concerns.'.

(2) DROUGHT DISASTER RELIEF AUTHORITY- Section 7(b)(2) of the Small Business Act (15 U.S.C. 636(b)(2)) is amended--

(A) by inserting `including drought, with respect to both farm-related and nonfarm-related small business concerns affected by drought,' before `if the Administration'; and

(B) in subparagraph (B), by striking `the Consolidated Farmers Home Administration Act of 1961 (7 U.S.C. 1961)' and inserting the following: `section 321 of the Consolidated Farm and Rural Development Act (7 U.S.C. 1961), in which case, assistance under this paragraph may be provided to farm-related and nonfarm-related small business concerns, subject to the other applicable requirements of this paragraph'.

(d) PROMPT RESPONSE TO DISASTER REQUESTS- Section 7(b)(2)(D) of the Small Business Act (15 U.S.C. 636(b)(2)(D)) is amended by striking `Upon receipt of such certification, the Administration may' and inserting `Not later than 30 days after the date of receipt of such certification by a Governor of a State, the Administration shall respond in writing to that Governor on its determination and the reasons therefore, and may'.

(e) LIMITATION ON LOANS- From funds otherwise appropriated for loans under section 7(b) of the Small Business Act (15 U.S.C. 636(b)), not more than $9,000,000 may be used during fiscal year 2003 to provide drought disaster loans to non-farm related small business concerns.

(f) RULEMAKING- Not later than 45 days after the date of enactment of this Act, the Administrator of the Small Business Administration shall promulgate final rules to carry out this Act and the amendments made by this Act.

END