,,ii #aagth ,,congress #b;d ,session ,s4 #eajb ,,in ,,the ,,senate ,,of ,,the ,,united ,,states ,november #af1 #bjbb,mr4 ,cardin introduced the following bill2 which was read twice and referred to the ,committee on ,small ,business and ,entrepreneurship ,a ,,bill ,to authorize the ,community ,advantage ,loan ,program of the ,small ,business ,administration1 and for other purposes4 #a4 ,short title ,this ,act may be cited as the ,community ,advantage ,loan ,program ,permanency ,act of #bjbb4 #b4 ,findings ,congress finds that-- 7#a7 capital access remains one of the largest barriers to overcome for socially and economically disadvantaged business owners as well as for the smallest small businesses2 7#b7 according to the ,double ,jeopardy3 ,,covid-#ai's ,concentrated ,health and ,wealth ,effects in ,black ,communities study conducted by the ,federal ,reserve banks1 in #bjbj-- 7,a7 firms owned by people of color are more likely to have weak capitalizations1 limited bank relationships1 and little in cash reserves2 and 7,b7 #ea percent of ,black-owned businesses have less than #c months of cash reserves in case of an emergency1 which is nearly #g percentage points higher than their peers2 7#c7 according to the ,small ,business ,credit ,survey conducted by the ,federal ,reserve banks1 in #bjba-- 7,a7 #ca percent of firms that sought financing received the full financing sought by the firm2 7,b7 firms owned by people of color were least likely to receive the full amount of financing sought by the firm1 with #ae percent of ,asian-owned businesses1 #af percent of ,black-owned businesses1 and #ai percent of ,hispanic-owned businesses receiving full financing1 as opposed to #ce percent of non-,hispanic ,white-owned businesses receiving full financing2 and 7,c7 firms with fewer employees were also least likely to receive the full financing sought by the firm1 with #bc percent of businesses with #a to #d employees and #cg percent of businesses with #e to #di employees receiving full financing1 as opposed to #ee percent of businesses with #ej to #dii employees receiving full financing2 7#d7 the ,community ,advantage ,pilot ,program of the ,small ,business ,administration has helped increase lending backed by the ,administration to firms owned by people of color1 women1 and veterans and firms classified as start ups2 7#e7 from fiscal year #bjah to fiscal year #bjbb-- 7,a7 #ac percent of loans under the ,community ,advantage ,pilot ,program went to ,black business owners1 while #d percent of loans under the loan program under section #g7;a7 of the ,small ,business ,act 7#ae ,u4,s4,c4 #fcf7;a77 7in this section referred to as the #g7;a7 loan program7 went to ,black business owners2 7,b7 #ae percent of loans under the ,community ,advantage ,pilot ,program went to ,hispanic business owners1 while #h percent of loans under the #g7;a7 loan program went to ,hispanic business owners2 7,c7 #bj percent of loans under the ,community ,advantage ,pilot ,program went to women business owners1 while #ag percent of loans under the #g7;a7 loan program went to women business owners2 and 7,d7 #i percent of loans under the ,community ,advantage ,pilot ,program went to veteran business owners1 while #e percent of loans under the #g7;a7 loan program went to veteran business owners2 and 7#f7 from fiscal year #bjbj to fiscal year #bjba1 #ad percent of loans under the ,community ,advantage ,pilot ,program went to startup business owners1 while #g percent of loans under the #g7;a7 loan program went to startup business owners4 #c4 ,community ,advantage ,loan ,program 7a7 ,in general ,section #g7;a7 of the ,small ,business ,act 7#ae ,u4,s4,c4 #fcf7;a77 is amended by adding at the end the following3 7#ch7 ,community ,advantage ,loan ,program 7,a7 ,purposes ,the purposes of the ,community ,advantage ,loan ,program are-- 7i7 to create a mission-oriented loan guarantee program that builds on the demonstrated success of the ,community ,advantage ,pilot ,program of the ,administration1 as established in #bjaa1 to reach more underserved small business concerns2 7ii7 to increase lending to small business concerns in underserved and rural markets1 including veterans and members of the military community1 socially and economically disadvantaged individuals1 as described in paragraphs 7#e7 and 7#f77;,a7 of section #h7;a71 respectively1 women1 and new businesses2 7iii7 to ensure that the program under this subsection expands inclusion and more broadly meets congressional intent to reach borrowers who are unable to get credit elsewhere on reasonable terms and conditions2 7iv7 to help underserved small business concerns become bankable by utilizing the small dollar financing and business support experience of mission-oriented lenders2 7v7 to allow certain mission-oriented lenders1 primarily financial intermediaries focused on economic development in underserved markets1 access to guarantees for loans under this subsection 7in this paragraph referred to as #g7;a7 loans7 of not more than #cej1jjj and provide management and technical assistance to small business concerns as needed2 7vi7 to provide certainty for the lending partners that make loans under this subsection and to attract new lenders2 7vii7 to encourage collaboration between mission-oriented and conventional lenders under this subsection in order to support underserved small business concerns2 and 7viii7 to assist covered institutions with providing business support services and technical assistance to small business concerns1 when needed4 7,b7 ,definitions ,in this paragraph-- 7i7 the term ,community ,advantage ,network ,partner-- 7,i7 means a nonprofit1 mission-oriented organization that acts as a ,referral ,agent to covered institutions in order to expand the reach of the program to small businesses in underserved markets2 and 7,,ii7 does not include a covered institution making loans under the program2 7ii7 the term covered institution means an entity that-- 7,i7 is-- 7aa7 a development company1 as defined in section #ajc of the ,small ,business ,investment ,act of #aieh 7#ae ,u4,s4,c4 #ffb71 participating in the #ejd ,loan ,guaranty program established under title ,v of that ,act 7#ae ,u4,s4,c4 #fie et seq472 7bb7 a nonprofit intermediary1 as defined in subsection 7m77#aa71 participating in the microloan program under subsection 7m72 7cc7 a non-,federally regulated entity or a lending institution certified as a community development financial institution by the ,community ,development ,financial ,institutions ,fund established under section #ajd7;a7 of the ,riegle ,community ,development and ,regulatory ,improvement ,act of #aiid 7#ab ,u4,s4,c4 #dgjc7;a772 or 7dd7 an eligible intermediary1 as defined in subsection 7l77#a71 participating in the ,intermediary ,lending ,program established under subsection 7l77#b72 and 7,,ii7 has approved and disbursed #aj similarly sized loans in the preceding #bd-month period and is servicing not less than #aj similarly sized loans to small business concerns in the portfolio of the entity2 7iii7 the term existing business means a small business concern that has been in existence for not less than #b years on the date on which a loan is made to the small business concern under the program2 7iv7 the term new business means a small business concern that has been in existence for not more than #b years on the date on which a loan is made to the small business concern under the program2 7v7 the term program means the ,community ,advantage ,loan ,program established under subparagraph 7,c72 7vi7 the term ,referral ,agent has the meaning given the term in section #ajc4a7;f7 of title #ac1 ,code of ,federal ,regulations1 or any successor regulation2 7vii7 the term rural area means any county that the ,bureau of the ,census has defined as mostly rural or completely rural in the most recent decennial census2 and 7viii7 the term small business concern in an underserved market means a small business concern-- 7,i7 that is located in-- 7aa7 a low- to moderate-income community2 7bb7 a ,h,u,b,zone1 as that term is defined in section #ca7;b72 7cc7 a rural area2 or 7dd7 any area for which a disaster declaration or determination described in subparagraph 7,a71 7,b71 7,c71 or 7,e7 of subsection 7b77#b7 has been made that has not terminated more than #b years before the date 7or later1 as determined by the ,administrator7 on which a loan is made to the small business concern under the program1 except that1 in the case of a major disaster described in subsection 7b77#b77;,a71 that period shall be #e years2 7,,ii7 for which more than #ej percent of the employees reside in a low- or moderate-income community2 7,,iii7 that is a new business2 7,,iv7 owned and controlled by socially and economically disadvantaged individuals1 as described in paragraphs 7#e7 and 7#f77;,a7 of section #h7;a71 respectively1 which the ,administrator1 in carrying out the program1 shall presume includes ,black ,americans1 ,hispanic ,americans1 ,native ,americans1 ,asian ,pacific ,americans1 and other minorities2 7,v7 owned and controlled by women2 7,,vi7 owned and controlled by veterans or spouses of veterans2 7,,vii7 owned and controlled by a member of an ,indian ,tribe individually identified 7including parenthetically7 in the most recent list published pursuant to section #ajd of the ,federally ,recognized ,indian ,tribe ,list ,act of #aiid 7#be ,u4,s4,c4 #eaca72 7,,viii7 owned and controlled by an individual who has completed a term of imprisonment in a ,federal1 ,state1 or local jail or prison2 7,,ix7 owned and controlled by an individual with a disability1 as that term is defined in section #c of the ,americans with ,disabilities ,act of #aiij 7#db ,u4,s4,c4 #abajb72 or 7,x7 as otherwise determined by the ,administrator4 7,c7 ,establishment ,there is established a ,community ,advantage ,loan ,program under which the ,administration may guarantee loans made by covered institutions under this subsection1 with an emphasis on loans made to small business concerns in underserved markets4 7,d7 ,program levels ,in fiscal year #bjbc and each fiscal year thereafter1 not more than #aj percent of the number of loans guaranteed under this subsection may be guaranteed under the program4 7,e7 ,grandfathering of existing lenders ,any covered institution that actively participated in the ,community ,advantage ,pilot ,program of the ,administration and is in good standing1 as determined by the ,administration1 on the day before the date of enactment of this paragraph-- 7i7 shall retain designation in the program2 7ii7 shall not be required to submit an application to participate in the program2 and 7iii7 for the purpose of determining the loan loss reserve amount of the covered institution1 shall have participation in the ,community ,advantage ,pilot ,program included in the calculation under subparagraph 7,j74 7,f7 ,requirement to make loans to underserved markets ,not less than #gj percent of loans made by a covered institution under the program shall consist of loans made to small business concerns in underserved markets4 7,g7 ,maximum loan amount ,the maximum loan amount for a loan guaranteed under the program is #cej1jjj4 7,h7 ,interest rates ,the maximum allowable interest rate prescribed by the ,administration on any financing made on a deferred basis pursuant to the program shall not exceed the maximum allowable interest rate under sections #abj4bac and #abj4bad of title #ac1 ,code of ,federal ,regulations1 or any successor regulations4 7,i7 ,refinancing of ,community ,advantage program loans ,a loan guaranteed under the program or guaranteed under the ,community ,advantage ,pilot ,program of the ,administration may be refinanced into another #g7;a7 loan made by lender that does not participate in the program4 7,j7 ,loan loss reserve requirements 7i7 ,loan loss reserve account for covered institutions ,a covered institution-- 7,i7 with not more than #e years of participation in the program shall maintain a loan loss reserve account with an amount equal to #e percent of the outstanding amount of the unguaranteed portion of the loan portfolio of the covered institution under the program2 and 7,,ii7 with more than #e years of participation in the program shall maintain a loan loss reserve account with an amount equal to the average repurchase rate of the covered institution over the preceding #cf-month period4 7ii7 ,additional loan loss reserve amount for selling loans on the secondary market ,in addition to the amount required in the loan loss reserve account under clause 7i71 a covered institution that sells a program loan on the secondary market shall be required to maintain the following additional amounts in the loan loss reserve account3 7,i7 ,an amount equal to #b percent of the guaranteed portion of each program loan sold on the secondary market for lenders with less than #e years experience selling program loans on the secondary market4 7,,ii7 ,an amount equal to the average repurchase rate for loans sold by the lender on the secondary market over the preceding #cf months for lenders with more than #e years experience selling program loans on the secondary market4 7iii7 ,recalculation ,the loan loss reserve required under clauses 7i7 and 7ii7 shall be recalculated on ,october #a of each year4 7,k7 ,training ,the ,administration-- 7i7 shall provide accessible upfront and ongoing training for covered institutions making loans under the program to support program compliance and improve the interface between the covered institutions and the ,administration1 which shall include-- 7,i7 guidance for following the regulations of the ,administration2 and 7,,ii7 guidance specific to mission-oriented lending that is intended to help lenders effectively reach and support underserved small business concerns1 including management and technical assistance delivery2 7ii7 shall ensure that the training described in clause 7i7 is provided for free or at a low cost2 7iii7 may enter into a contract to provide the training described in clause 7i7 with an organization with expertise in lending under this subsection and primarily specializing in mission-oriented lending1 and lending to underserved markets2 and 7iv7 shall provide training for the employees and contractors of the ,administration that regularly engage with covered institutions or borrowers in the program4 7,l7 ,community advantage outreach and education ,the ,administrator-- 7i7 shall develop and implement a program to promote to1 conduct outreach to1 and educate prospective covered institutions about the program1 with a focus on women- and minority-owned covered institutions2 and 7ii7 may enter into a contract with #a or more nonprofit organizations experienced in working with and training mission driven lenders to provide the outreach and education described in clause 7i74 7,m7 ,community advantage network partner participation 7i7 ,in general ,a covered institution that uses a ,community ,advantage ,network ,partner shall abide by policies and procedures of the ,administration concerning the use of ,referral ,agent fees permitted by the ,administration and disclosure of those fees4 7ii7 ,payment of fees ,notwithstanding any other provision of law1 all fees described in clause 7i7 shall be paid by the covered institution to the ,community ,advantage ,network ,partner upon disbursement of the applicable program loan4 7,n7 ,delegated authority ,a covered institution is not eligible to receive delegated authority from the ,administration under the program until the covered institution has approved and fully disbursed not less than #aj loans under the program and the ,administration had evaluated the ability of the covered institution to fulfill program requirements4 7,o7 ,reporting 7i7 ,weekly reports 7,i7 ,in general ,the ,administration shall report on the website of the ,administration1 as part of the weekly reports on lending approvals under this subsection-- 7aa7 on and after the date of enactment of this paragraph1 the number and dollar amount of loans guaranteed under the ,community ,advantage ,pilot ,program of the ,administration2 and 7bb7 on and after the date on which the ,administration begins to approve loans under the program1 the number and dollar amount of loans guaranteed under the program4 7,,ii7 ,separate accounting ,the number and dollar amount of loans reported in a weekly report under subclause 7,i7 for loans guaranteed under the ,community ,advantage ,pilot ,program of the ,administration and under the program shall include a breakdown by the categories of race1 ethnicity1 and gender of the owners of the small business concerns1 by whether the small business concern is a new or existing small business concern1 and by whether the small business concern is located in an urban or rural area1 and broken down by-- 7aa7 loans of not more than #ej1jjj2 7bb7 loans of more than #ej1jjj and not more than #aej1jjj2 7cc7 loans of more than #aej1jjj and not more than #bej1jjj2 and 7dd7 loans of more than #bej1jjj and not more than #cej1jjj4 7ii7 ,annual reports 7,i7 ,in general ,for each fiscal year in which the program is in effect1 the ,administration shall submit to the ,committee on ,small ,business and ,entrepreneurship of the ,senate and the ,committee on ,small ,business of the ,house of ,representatives1 and make publicly available on the internet1 information about loans provided under the program and under the ,community ,advantage ,pilot ,program of the ,administration4 7,,ii7 ,contents ,each report submitted and made publicly available under subclause 7,i7 shall include-- 7aa7 the number and dollar amounts of loans provided to small business concerns under the program1 including a breakdown by-- 7,,aa7 the gender of the owners of the small business concern2 7,,bb7 the race and ethnicity of the owners of the small business concern1 disaggregated in a manner that captures all the racial groups specified in the ,american ,community ,survey conducted by the ,bureau of the ,census2 7,,cc7 whether the small business concern is located in an urban or rural area2 and 7,,dd7 whether the small business concern is an existing business or a new business1 as provided in the weekly reports on lending approvals under this subsection2 7bb7 the proportion of loans described in item 7aa7 compared to-- 7,,aa7 other #g7;a7 loans of any amount2 7,,bb7 other #g7;a7 loans of similar amounts2 7,,cc7 express loans provided under paragraph 7#ca7 of similar amounts2 and 7,,dd7 other #g7;a7 loans of similar amounts provided to small business concerns in underserved markets2 7cc7 a comparison of the number and dollar amounts of loans provided to small business concerns under the program and under each category of loans described in item 7aa71 broken down by-- 7,,aa7 loans of not more than #ej1jjj2 7,,bb7 loans of more than #ej1jjj and not more than #aej1jjj2 7,,cc7 loans of more than #aej1jjj and not more than #bej1jjj2 and 7,,dd7 loans of more than #bej1jjj and not more than #cej1jjj2 7dd7 the number and dollar amounts of loans provided to small business concerns under the program by ,state1 and the jobs created or retained within each ,state2 7ee7 a list of covered institutions participating in the program and the ,community ,advantage ,pilot ,program of the ,administration1 including-- 7,,aa7 the name1 location1 and contact information1 such as the website and telephone number1 of each covered institution2 and 7,,bb7 a breakdown by the number and dollar amount of the loans approved for small business concerns2 and 7ff7 the benchmarks established by the ,community ,advantage ,working ,group under subparagraph 7,o77i74 7,,iii7 ,timing ,an annual report required under this clause shall-- 7aa7 be submitted and made publicly available not later than ,december #a of each year2 and 7bb7 cover the lending activity for the fiscal year that ended on ,september #cj of that same year4 7,p7 ,,gao report ,not later than #e years after the date of enactment of this paragraph1 the ,comptroller ,general of the ,united ,states shall submit to the ,administrator1 the ,committee on ,small ,business and ,entrepreneurship of the ,senate1 and the ,committee on ,small ,business of the ,house of ,representatives a report-- 7i7 assessing-- 7,i7 the extent to which the program fulfills the requirements of this paragraph2 and 7,,ii7 the performance of covered institutions participating in the program2 and 7ii7 providing recommendations on the administration of the program and the findings under subclauses 7,i7 and 7,,ii7 of clause 7i74 7,q7 ,community ,advantage ,working ,group 7i7 ,in general ,not later than #ij days after the date of enactment of this paragraph1 the ,administrator shall establish a ,community ,advantage ,working ,group1 which shall-- 7,i7 include-- 7aa7 a geographically diverse representation of members from among covered institutions participating in the program2 and 7bb7 representatives from the ,office of ,capital ,access of the ,administration1 including the ,office of ,credit ,risk ,management1 the ,office of ,financial ,assistance1 and the ,office of ,economic ,opportunity2 7,,ii7 develop recommendations on how the ,administration can effectively manage1 support1 and promote the program and the mission of the program2 7,,iii7 establish metrics of success and benchmarks that reflect the mission and population served by covered institutions under the program1 which the ,administration shall use to evaluate the performance of those covered institutions2 7,,iv7 establish criteria assessing the business support services and technical assistance needs of borrowers and methods to assess lender expertise to provide necessary services and assistance2 and 7,v7 institute regular and sustainable systems of communication between the ,administration and covered institutions participating in the program4 7ii7 ,report ,not later than #a year after the date of enactment of this paragraph1 the ,administrator shall submit to the ,committee on ,small ,business and ,entrepreneurship of the ,senate and the ,committee on ,small ,business of the ,house of ,representatives a report that includes-- 7,i7 the recommendations of the ,community ,advantage ,working ,group established under clause 7i72 and 7,,ii7 a recommended plan and timeline for implementation of those recommendations4 7,r7 ,regulations 7i7 ,in general ,not later than #ahj days after the date of enactment of this paragraph1 the ,administrator shall promulgate regulations governing the program1 including metrics for lender performance1 metrics of success and benchmarks of the program1 and criteria for appropriate management and technical assistance4 7ii7 ,updates ,the ,administrator shall consult the report issued under subparagraph 7,p77ii7 and1 not later than #ahj days after submission of the report1 promulgate any necessary changes to existing regulations of the ,administration based on the recommendations contained in the report4 7,s7 ,authorization of appropriations ,there is authorized to be appropriated such sums as may be necessary to conduct outreach and education described in subparagraph 7,l74 4 7b7 ,participation ,section #g7;a77#b7 of the ,small ,business ,act 7#ae ,u4,s4,c4 #fcf7;a77#b77 is amended-- 7#a7 in subparagraph 7,a71 in the matter preceding clause 7i71 by striking and 7,f7 and inserting 7,f71 and 7,g72 and 7#b7 by adding at the end the following3 7,g7 ,participation in the ,community ,advantage ,loan ,program ,in an agreement to participate in a loan on a deferred basis under paragraph 7#ch71 the participation by the ,administration shall be-- 7i7 #hj percent of the balance of the financing outstanding at the time of the disbursement of the loan1 if that balance is more than #aej1jjj and not more than #cej1jjj2 or 7ii7 #ij percent of the balance of the financing outstanding at the time of the disbursement of the loan1 if that balance is not more than #aej1jjj4 4