Washington, D.C.— Today, the House passed four bipartisan bills to make key changes to the Small Business Administration’s (SBA) 504 and 7(a) lending programs and to improve the appeals process in the HUBZone federal contracting program.
"Today, my colleagues from both sides of the aisle joined together to support small businesses by passing these bills to enhance access to capital and expand opportunities for small firms in the federal contracting space," said Chairwoman Nydia M. Velazquez (D-NY). "We've heard directly from small business owners about how these flaws in SBA programs are creating obstacles. These fixes will put more capital in entrepreneurs' hands and make it easier for small firms to participate in federal procurement."
H.R. 7903, “To amend the Small Business Act to establish the Community Advantage Loan Program”
Introduced by Rep. Judy Chu (D-CA) and Rep. Ross Spano (R-FL)
The bill would authorize the Community Advantage (CA) program for five years (FY21-FY25). In addition to access to the 7(a) guaranty, the bill also requires SBA to provide free or low-cost in-person and online training upfront and on an ongoing basis to Community Advantage lenders.
H.R. 8211, “504 Modernization and Small Manufacturer Enhancement Act of 2020”
Introduced by Rep. Angie Craig (D-MN) and Ranking Member Steve Chabot (R-OH)
This legislation increases the maximum loan amount for manufacturing loans from $5.5 million to $6.5 million and requires SBA District Offices to partner with SBA Resource Partners to provide entrepreneurial development assistance to small manufacturers. The bill decreases the percentage of total project costs that the SBA requires small manufacturers to put up as a down payment, from 10% to 5%. The bill also increases the job creation/retention requirements for small manufacturers. The bill adjusts collateral requirements and debt refinance parameters for small manufacturers. The bill would streamline numerous administrative processes associated with the 504 loan closing process by allowing accredited CDCs to perform multiple closing-related tasks, such as correcting any borrower or lender information on loan documents.
H.R. 8199, “504 Credit Risk Management Improvement Act of 2020”
Introduced by Rep. Dan Bishop (R-NC) and Rep. Angie Craig (D-MN)
The bill shifts loan closing file review responsibilities to the Office of Credit Risk Management (OCRM) and allows SBA to charge CDCs a fee to cover the cost of oversight, which becomes effective one year after enactment. The bill also clarifies OCRM’s duties, as well as the enforcement actions OCRM may take against a CDC, which are aligned with those enacted under the 2018 7(a) Oversight Act. The bill also includes penalties for CDCs who submit required annual reports to SBA more than 30 days late. The bill also directs SBA to issue rules for CDC compliance with the National Environmental Policy Act of 1969.
H.R. 8229, the “Parity for HUBZone Appeals Act of 2020”
Introduced by Rep. Aumua Amata Radewagen (R-AS) and Rep. Chrissy Houlahan (D-PA)
The bill directs the Small Business Administration (SBA) to issue regulations, no later than a year after its enactment, to grant the Office of Hearing and Appeals (OHA) jurisdiction over HUBZone status appeals. The purpose of the bill is to achieve parity and uniformity of appeal processes between the HUBZone Program and the Service-Disabled Veteran-Owned Small Business (SDVOSB) and Women-Owned Small Business (WOSB) programs by shifting the responsibility to hear HUBZone status appeals from the Associate Administrator of the Office of Government Contracting & Business Development (AA/GCBD) to OHA. Moreover, providing OHA with jurisdiction over all program status appeals promotes efficiency and guarantees expertise. Finally, it would encourage transparency and consistency in opinions since OHA opinions are published.
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