,i #aafth ,,congress #ast ,session ,h4 ,r4 #diae ,,in ,,the ,,house ,,of ,,representatives ,october #cj1 #bjai,mr4 ,schneider 7for himself1 ,mr4 ,fitzpatrick1 and ,mr4 ,crow7 introduced the following bill2 which was referred to the ,committee on ,small ,business ,a ,,bill ,to amend the ,small ,business ,act to provide loan guarantees for the acquisition of cybersecurity technology and services by eligible small businesses1 and for other purposes4 #a4 ,short title ,this ,act may be cited as the ,small ,business ,cybersecurity ,enhancement ,act4 #b4 ,loan guarantees for cybersecurity technology and services 7a7 ,in general ,the ,small ,business ,act 7#ae ,u4,s4,c4 #fca et seq47 is amended-- 7#a7 by redesignating section #di as section #ej2 and 7#b7 by inserting the following new section after section #dh3 #di4 ,loan guarantees for cybersecurity technology and services 7a7 ,definitions ,as used in this section3 7#a7 ,cybersecurity technology and services ,the term cybersecurity technology and services-- 7,a7 means-- 7i7 computer hardware1 software1 and related technology that-- 7,i7 supports the prevention of damage to1 protection of1 and restoration of computers1 electronic communications systems1 electronic communications services1 wire communication1 and electronic communication1 including information contained therein1 to ensure its availability1 integrity1 authentication1 confidentiality1 and nonrepudiation2 7,,ii7 is purchased by an eligible small business2 7,,iii7 provides for encryption of data1 detection of malware1 or protection of information and information systems from unauthorized access1 use1 disclosure1 disruption1 modification1 or destruction2 7,,iv7 meets any requirements established by the ,small ,business ,development ,center ,cyber ,strategy developed under section #ahda7;a7 of the ,national ,defense ,authorization ,act for ,fiscal ,year #bjag 7,public ,law #aad-cbh2 #acj ,stat4 #bffb72 and 7,v7 meets any industry best practices standards2 7ii7 an insurance product available for purchase by an eligible small business that provides coverage for losses caused by a cyber attack on such business2 7iii7 services related to-- 7,i7 the installation of computer hardware1 software1 and related technology described under clause 7i72 or 7,,ii7 training on security principles for employees of an eligible small business2 or 7iv7 has the meaning given such term by the ,administrator2 and 7,b7 does not include information technology whose sole use is financial management1 maintenance of inventory of basic supplies1 or appointment scheduling4 7#b7 ,eligible small business ,the term eligible small business means a small business concern that-- 7,a7 has #ajj or fewer employees2 7,b7 has been in business for at least #a year2 and 7,c7 has obtained training from a small business development center4 7#c7 ,prime rate ,the term prime rate means the discount window primary credit interest rate most recently published in the ,federal ,reserve ,statistical ,release on selected interest rates 7daily or weekly71 commonly referred to as the ,h4#ae release1 or any successor publication4 7b7 ,loan guarantees for eligible small businesses 7#a7 ,guarantee percentage ,subject to paragraph 7#b71 the ,administrator may guarantee up to #ij percent of the amount of a loan made to an eligible small business for-- 7,a7 the acquisition of cybersecurity technology and services for use in the business operations of the eligible small business2 and 7,b7 the costs associated with the installation or use of such cybersecurity technology and services4 7#b7 ,limitations on guarantee amounts ,the maximum amount of the principal of a loan guaranteed under this section may not exceed #ej1jjj4 ,the aggregate total amount of the principal of loans guaranteed under this section in a year may not exceed #ejj1jjj1jjj4 7c7 ,fees ,with respect to each loan guaranteed under this section1 the ,administration shall assess1 collect1 and retain such fees as are necessary to reduce to zero the cost to the ,administration of making guarantees under this section4 ,as used in this subsection1 the term cost has the meaning given that term in section #ejb of the ,federal ,credit ,reform ,act of #aiij 7#b ,u4,s4,c4 #ffa;a74 7d7 ,interest rates 7#a7 ,fixed rate loans ,with respect to a fixed rate loan guaranteed under this section1 the interest rate for such a loan may not exceed-- 7,a7 for a loan in an amount greater than #be1jjj1 the prime rate2 and 7,b7 for a loan in an amount less than or equal to #be1jjj1 the prime rate plus #c4be percent4 7#b7 ,variable rate loans 7,a7 ,in general ,with respect to a variable rate loan guaranteed under this section1 the interest rate for such a loan shall equal-- 7i7 the prime rate plus the spread described under subparagraph 7,b72 or 7ii7 the optional peg rate1 as calculated quarterly by the ,administrator and published in the ,federal ,register1 plus the spread described under subparagraph 7,b74 7,b7 ,negotiation of spread and rate of change ,the lender and the borrower shall negotiate the amount of the spread which will be added to the interest rate described under subparagraph 7,a7 and select the frequency at which the spread will change1 which shall be no more often than monthly and shall be consistent over the term of the loan4 7e7 ,deferral period ,the ,administrator may defer payment of the principal and interest on a loan guaranteed under this section for a period not to exceed #c years4 7f7 ,terms and conditions for loan guarantees 7#a7 ,in general ,a loan guaranteed under this section shall be subject to such terms and conditions as the ,administrator may prescribe1 including-- 7,a7 explicit standards for use in periodically assessing the credit risk of guaranteed loans2 7,b7 a requirement that the final maturity of such a loan may not exceed #g years2 and 7,c7 a requirement that such a loan may not be subordinated to another debt contracted by the borrower or to any other claims against the borrower in the case of default4 7#b7 ,restrictions ,the ,administrator may not guarantee a loan under this section-- 7,a7 unless the ,administrator determines that the lender is responsible1 that there is a reasonable assurance of repayment1 and that adequate provision is made for servicing the loan on reasonable terms and protecting the financial interest of the ,united ,states2 7,b7 except to the extent that appropriations of budget authority to cover their costs are made in advance1 as required under section #ejd of the ,federal ,credit ,reform ,act of #aiij2 and 7,c7 if-- 7i7 the income from such loan is excluded from gross income for purposes of chapter #a of the ,internal ,revenue ,code of #aihf2 or 7ii7 the guarantee provides significant collateral or security1 as determined by the ,administrator1 for other obligations the income from which is so excluded4 7#c7 ,guarantees ,a loan guarantee provided under this section shall be conclusive evidence that-- 7,a7 the guarantee has been properly obtained2 7,b7 the underlying loan qualified for such guarantee2 and 7,c7 absent fraud or material misrepresentation by the holder and the lender1 the guarantee is presumed to be valid1 legal1 and enforceable4 7g7 ,payment of losses 7#a7 ,in general ,if1 as a result of a default by a borrower under a loan guaranteed under this section1 and after the holder of the loan has made collection efforts and instituted enforcement proceedings as the ,administrator may require1 the ,administrator determines that the holder of the loan has suffered a loss1 the ,administrator shall pay to such holder the percentage of such loss specified in the guarantee contract4 ,upon making any such payment1 the ,administrator shall be subrogated to all the rights of the recipient of the payment4 ,the ,administrator shall be entitled to recover from the borrower the amount of any payments made to the holder of the loan under this paragraph4 7#b7 ,forbearance ,nothing in this section may be construed to preclude any forbearance for the benefit of the borrower which may be agreed upon by the parties to the guaranteed loan and approved by the ,administrator1 if budget authority for any resulting subsidy costs 7as defined in section #ejb7e7 of the ,federal ,credit ,reform ,act of #aiij7 is available4 7#c7 ,management of property ,notwithstanding any other provision of law relating to the acquisition1 handling1 or disposal of property by the ,united ,states1 the ,administrator may complete1 recondition1 reconstruct1 renovate1 repair1 maintain1 operate1 or sell any property acquired by the ,administrator pursuant to this section4 7h7 ,sunset of authority ,the authority of the ,administrator to make new loan guarantees under this section shall terminate after the end of the #e-year period beginning on the date of the enactment of this section4 4 7b7 ,effective date ,the amendments made by subsection 7a7 shall take effect on the date that is #ahj days after the date of the enactment of this ,act4