[Congressional Bills 118th Congress]
[From the U.S. Government Publishing Office]
[S. 1345 Introduced in Senate (IS)]
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118th CONGRESS
1st Session
S. 1345
To amend the Small Business Act to enhance the Office of Credit Risk
Management, to require the Administrator of the Small Business
Administration to issue rules relating to environmental obligations of
certified development companies, and for other purposes.
_______________________________________________________________________
IN THE SENATE OF THE UNITED STATES
April 27, 2023
Mr. Young (for himself, Ms. Klobuchar, and Mr. Booker) introduced the
following bill; which was read twice and referred to the Committee on
Small Business and Entrepreneurship
_______________________________________________________________________
A BILL
To amend the Small Business Act to enhance the Office of Credit Risk
Management, to require the Administrator of the Small Business
Administration to issue rules relating to environmental obligations of
certified development companies, 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 ``504 Credit Risk Management
Improvement Act of 2023''.
SEC. 2. ENHANCEMENTS TO THE OFFICE OF CREDIT RISK MANAGEMENT.
Section 47 of the Small Business Act (15 U.S.C. 657t) is amended--
(1) by striking subsection (b) and inserting the following:
``(b) Duties.--The Office--
``(1) shall be responsible for--
``(A) supervising--
``(i) any lender making loans under section
7(a) (in this section referred to as a `7(a)
lender');
``(ii) any Lending Partner or Intermediary
participant of the Administration in a lending
program of the Office of Capital Access of the
Administration;
``(iii) any small business lending company
or a non-Federally regulated lender without
regard to the requirements of section 23; and
``(iv) any certified development company
described under the program established under
title V of the Small Business Investment Act of
1958 (15 U.S.C. 695 et seq.) (referred to in
this section as a `certified development
company'), as provided in subsection (k); and
``(B) conducting file reviews with respect to loan
closings under the program established under title V of
the Small Business Investment Act of 1958 (15 U.S.C.
695 et seq.), as provided in subsection (j); and
``(2) may--
``(A) take formal and informal enforcement actions
against a certified development company, as provided in
subsection (l); and
``(B) charge a certified development company a fee,
as provided in subsection (m).''; and
(2) by adding at the end the following:
``(j) Loan Closing File Reviews.--With respect to a loan closing
under the program established under title V of the Small Business
Investment Act of 1958 (15 U.S.C. 695 et seq.), the Office shall be
responsible for the following:
``(1) Conducting a complete file review of a random
selection of all loan closings, the number, frequency, and
conduct of which shall be at the discretion of the Office, to
ensure program integrity, including a review of the items
listed on the Checklist for Complete File Review contained in
the appropriate form of the Administration.
``(2) Not later than 60 days after the date on which each
complete file review conducted under paragraph (1) is
completed, preparing a written report documenting the results
of that review, which the Office shall send to--
``(A) the applicable certified development company;
``(B) the designated attorney that closed the loan
for the certified development company; and
``(C) the Commercial Loan Service Center.
``(3) If a complete file review conducted under paragraph
(1) reveals a deficiency that could result in a loss to the
Administration, requiring the applicable certified development
company or the designated attorney to promptly correct the
deficiency.
``(k) Supervision of Certified Development Companies.--With respect
to the supervision of certified development companies--
``(1) an employee of the Office shall--
``(A) be present for, and supervise, the review of
any such company that is conducted by a contractor of
the Office on the premises of the company; and
``(B) supervise the review of any such company that
is conducted by a contractor of the Office that is not
conducted on the premises of the company; and
``(2) the Administrator shall--
``(A) develop a timeline for the review by the
Office of certified development companies and the
submission of reports regarding those reviews, under
which the Administrator shall--
``(i) submit to a certified development
company a written report of any review of the
company not later than 90 days after the date
on which the review is concluded; or
``(ii) if the Administrator expects to
submit the report after the end of the 90-day
period described in clause (i), notify the
company of the expected date of submission of
the report and the reason for the delay; and
``(B) if a response by a certified development
company is requested in a report submitted under
subparagraph (A)(i), require the company to submit
responses to the Administrator not later than 45
business days after the date on which the company
receives the report.
``(l) Enforcement Authority Against Certified Development
Companies.--
``(1) Informal enforcement authority.--The Director may
take an informal enforcement action against a certified
development company if the Director finds that the company has
violated a statutory or regulatory requirement or any
requirement in a Standard Operating Procedures Manual or Policy
Notice relating to a program or function of the Office of
Capital Access.
``(2) Formal enforcement authority.--
``(A) In general.--With the approval of the Lender
Oversight Committee established under section 48, the
Director may take a formal enforcement action against
any certified development company if the Director finds
that the company has violated--
``(i) a statutory or regulatory
requirement, including a requirement relating
to the necessary funds for making loans when
those funds are not made available to the
company from private sources on reasonable
terms; or
``(ii) any requirement described in a
Standard Operating Procedures Manual or Policy
Notice relating to a program or function of the
Office of Capital Access.
``(B) Enforcement actions.--The decision to take an
enforcement action against a certified development
company under subparagraph (A) shall be based on the
severity or frequency of the violation and may include
assessing a civil monetary penalty against the company
in an amount that is not greater than $250,000.
``(3) Failure to submit annual report.--With respect to a
certified development company that, as of the date that is 30
days after the date on which the company is required to submit
any report, fails to submit that report, the Director may--
``(A) suspend the company from participating in the
program established under title V of the Small Business
Investment Act of 1958 (15 U.S.C. 695 et seq.) for a
period that is not longer than 30 days; or
``(B) impose a penalty on the company in an amount
to be determined by the Director, except that the
amount of the penalty shall be not more than $10,000.
``(m) Fee Authority Regarding Certified Development Companies.--
``(1) In general.--On and after the date that is 1 year
after the date of enactment of this subsection, the Office may
collect from each certified development company a fee, the
amount of which--
``(A) shall be determined on a graduated scale
according to the size of the portfolio of the certified
development company with respect to the program carried
out under title V of the Small Business Investment Act
of 1958 (15 U.S.C. 695 et seq.); and
``(B) shall not exceed the amount that is 1 basis
point with respect to the value of the portfolio
described in subparagraph (A).
``(2) Payment.--A certified development company on which a
fee is imposed under paragraph (1) shall pay the fee from the
servicing fees collected by the development company pursuant to
regulation.''.
SEC. 3. RULES RELATING TO OBLIGATIONS OF CERTIFIED DEVELOPMENT
COMPANIES UNDER THE NATIONAL ENVIRONMENTAL POLICY ACT.
(a) Eligible Certified Development Company Defined.--In this
section, the term ``eligible certified development company'' means a
certified development company defined under title V of the Small
Business Investment Act of 1958 (15 U.S.C. 695 et seq.) that receives
assistance pursuant to that title.
(b) Requirement To Issue Rules.--Not later than 180 days after the
date of enactment of this Act, the Administrator of the Small Business
Administration shall issue rules to clarify the procedures necessary
for an eligible certified development company to comply with the
applicable requirements under National Environmental Policy Act of 1969
(42 U.S.C. 4321 et seq.).
(c) Rule of Construction.--Nothing in this section shall be
construed to modify the requirements of the National Environmental
Policy Act of 1969 (42 U.S.C. 4321 et seq.).
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