S. 537 (110th): Gulf Coast Back to Business Act of 2007

The text of the bill below is as of Feb 8, 2007 (Introduced).

Source: GPO

II

110th CONGRESS

1st Session

S. 537

IN THE SENATE OF THE UNITED STATES

February 8, 2007

(for herself, Mr. Lott, Mr. Kerry, and Mr. Lieberman) introduced the following bill; which was read twice and referred to the Committee on Small Business and Entrepreneurship

A BILL

To address ongoing small business and homeowner needs in the Gulf Coast States impacted by Hurricane Katrina and Hurricane Rita.

1.

Short title

This Act may be cited as the Gulf Coast Back to Business Act of 2007.

2.

Findings

Congress finds that—

(1)

43 percent of businesses that close following a natural disaster never reopen;

(2)

an additional 29 percent of businesses close down permanently within 2 years of a natural disaster;

(3)

Hurricane Katrina struck the Gulf Coast of the United States on August 29, 2005, negatively impacting small business concerns and disrupting commerce in the States of Louisiana, Mississippi, and Alabama;

(4)

Hurricane Rita struck the Gulf Coast of the United States on September 24, 2005, negatively impacting small business concerns and disrupting commerce in the States of Texas and Louisiana;

(5)

according to the United States Chamber of Commerce, more than 125,000 small- and medium-sized businesses in the Gulf Coast were disrupted by Hurricane Katrina or Hurricane Rita;

(6)

due to a slow initial Federal response and the widespread devastation in the affected States, businesses impacted by Hurricane Katrina are in dire need of increased access to capital and technical assistance to recover and prosper; and

(7)

without the full recovery and prosperity of affected businesses, the Gulf Coast, and the rest of the United States, will be negatively impacted.

3.

Definitions

In this Act—

(1)

the term Disaster Area means an area in which the President has declared a major disaster in response to Hurricane Katrina of 2005 or Hurricane Rita of 2005;

(2)

the term major disaster has the meaning given that term in section 102 of the Robert T. Stafford Disaster Relief and Emergency Assistance Act (42 U.S.C. 5122); and

(3)

the term small business concern has the meaning given that term in section 3 of the Small Business Act (15 U.S.C. 632).

4.

Small business concern recovery grants

(a)

In general

There are authorized to be appropriated to the Secretary of Commerce $100,000,000 for the Economic Development Administration of the Department of Commerce to make grants to the appropriate State government agencies in Louisiana and Mississippi, to carry out this section.

(b)

Disbursement of funds

(1)

In general

Subject to paragraph (2), the Secretary of Commerce shall disburse the funds authorized under subsection (a) as follows:

(A)

$75,000,000 to the State of Louisiana.

(B)

$25,000,000 to the State of Mississippi.

(2)

Proportionate allocation

Regardless of the amount appropriated under subsection (a), the amount appropriated shall be allocated among the States listed in paragraph (1) of this subsection in direct proportion to the allocation under that paragraph.

(c)

Use of funds

(1)

In general

Grants awarded to a State under subsection (a) shall be used by the State to provide grants, which may be made to any small business concern located in a Disaster Area that was negatively impacted by Hurricane Katrina of 2005 or Hurricane Rita of 2005, to assist such small business concern for the purposes of—

(A)

paying employees;

(B)

paying bills, insurance costs, and other existing financial obligations;

(C)

making repairs;

(D)

purchasing inventory;

(E)

restarting or operating that business in the community in which it was conducting operations prior to Hurricane Katrina of 2005 or Hurricane Rita of 2005, or to a neighboring area or county or parish in a Disaster Area;

(F)

compensating such small business concerns for direct economic injury suffered as a result of Hurricane Katrina of 2005 or Hurricane Rita of 2005; or

(G)

covering additional costs until that small business concern is able to obtain funding through insurance claims, Federal assistance programs, or other sources.

(2)

Criteria

(A)

In general

Notwithstanding any other provision of law, in making grants under paragraph (1), a State may use such criteria as the State determines appropriate, and shall not be required to apply eligibility criteria for programs administered by the Federal Government, including the Department of Commerce.

(B)

Exclusion

In making grants under paragraph (1), a State may not exclude a small business concern based on any increase in the revenue of that small business concern during the 12-month period beginning on October 1, 2005.

(3)

Administrative expenses

The Department of Commerce may use not more than $1,500,000 of the funds authorized under subsection (a) to administer the provision of grants to the designated States under this subsection.

5.

Disaster loans after Hurricane Katrina or Hurricane Rita

(a)

In general

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 or Hurricane Rita in a disaster area

(A)

Definitions

In this paragraph—

(i)

the term Disaster Area means an area in which the President has declared a major disaster in response to Hurricane Katrina of 2005 or Hurricane Rita of 2005; and

(ii)

the term qualified borrower means a person to whom the Administrator made a loan under this section because of Hurricane Katrina of 2005 or Hurricane Rita of 2005.

(B)

Deferment of disaster loan payments

(i)

In general

Notwithstanding any other provision of law, payments of principal and interest on a loan to a qualified borrower made before December 31, 2006, 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 on which funds are distributed under 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.

.

(b)

Increasing collateral requirements

(1)

In general

Notwithstanding any other provision of law, including section 7(c)(6) of the Small Business Act (15 U.S.C. 636(c)(6)), the Administrator may not require collateral for any covered loan made by the Administrator.

(2)

Definition

In this subsection, the term covered loan means a loan in an amount of not more than $35,000 made—

(A)

under section 7(b)(1) of the Small Business Act (15 U.S.C. 636(b)(1));

(B)

as a result of Hurricane Katrina of 2005 or Hurricane Rita of 2005; and

(C)

after the date of enactment of this Act.

6.

Other programs

(a)

HUBZones

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

(1)

in paragraph (1)—

(A)

in subparagraph (D), by striking or;

(B)

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

(C)

by adding at the end the following:

(F)

an area in which the President has declared a major disaster (as that term is defined in section 102 of the Robert T. Stafford Disaster Relief and Emergency Assistance Act (42 U.S.C. 5122)) as a result of Hurricane Katrina of August 2005 or Hurricane Rita of September 2005, during the time period described in paragraph (8).

; and

(2)

by adding at the end the following:

(8)

Time period

The time period for the purposes of paragraph (1)(F)—

(A)

shall be the 2-year period beginning on the later of the date of enactment of this paragraph and August 29, 2007; and

(B)

may, at the discretion of the Administrator, be extended to be the 3-year period beginning on the later of the date of enactment of this paragraph and August 29, 2007.

.

(b)

Relief from test program

Section 711(d) of the Small Business Competitive Demonstration Program Act of 1988 (15 U.S.C. 644 note) is amended—

(1)

by striking The Program and inserting the following:

(1)

In general

Except as provided in paragraph (2), the Program

; and

(2)

by adding at the end the following:

(2)

Exception

(A)

In general

The Program shall not apply to any contract related to relief or reconstruction from Hurricane Katrina of 2005 or Hurricane Rita of 2005 during the time period described in subparagraph (B).

(B)

Time period

The time period for the purposes of subparagraph (A)—

(i)

shall be the 2-year period beginning on the later of the date of enactment of this paragraph and August 29, 2007; and

(ii)

may, at the discretion of the Administrator, be extended to be the 3-year period beginning on the later of the date of enactment of this paragraph and August 29, 2007.

.