References in Text
For definition of “this chapter”, referred to in subsec. (b), see References in Text note set out under section 661 of this title.
[Pub. L. 111–240] added subpar. (L).
2009—Subsec. (e)(1), (2).
[Pub. L. 111–5], which directed amendment of section 501(e)(1), (2) of the Small Business Investment Act by substituting “$65,000” for “$50,000”, was executed by making the substitution in subsec. (e)(1), (2) of this section, which is section 501 of the Small Business Investment Act of 1958, to reflect the probable intent of Congress.
[Pub. L. 110–140, § 1204(a)(4)], inserted the following concluding provisions: “In subparagraphs (J) and (K), terms have the meanings given those terms under the Leadership in Energy and Environmental Design (LEED) standard for green building certification, as determined by the Administrator.”
Subsec. (d)(3)(I) to (K).
[Pub. L. 110–140, § 1204(a)(1)]–(3), added subpars. (I) to (K).
[Pub. L. 108–447] added subsec. (e).
[Pub. L. 106–554] inserted “or women-owned business development” before comma at end.
[Pub. L. 106–50] added subpar. (E) and redesignated former subpars. (E) to (G) as (F) to (H), respectively.
[Pub. L. 101–574, § 214(a)], amended subsec. (a) generally. Prior to amendment, subsec. (a) read as follows: “The Congress hereby finds and declares that the purpose of this subchapter is to foster economic development in both urban and rural areas by providing long term financing for small business concerns through the development company program authorized by this subchapter. In order to carry out this objective, the Administration is hereby directed to place greater emphasis on the needs of rural areas and the promotion of the development company program in such areas, and is further directed to develop a plan for greater outreach of procurement and export trade seminars in such areas. As used in this subchapter, the term ‘rural areas’ means those localities with populations of less than 20,000.”
[Pub. L. 101–574, § 214(b)], added subsec. (d).
[Pub. L. 100–590] inserted “State development companies” as section catchline, added subsec. (a), and redesignated former subsecs. (a) and (b) as (b) and (c), respectively.
Statutory Notes and Related Subsidiaries
Effective Date of 2007 Amendment
[Pub. L. 110–140] effective on the date that is 1 day after Dec. 19, 2007, see [section 1601 of Pub. L. 110–140], set out as an Effective Date note under section 1824 of Title 2, The Congress.
Budgetary Treatment of Loans and Financings
Assistance made available under any financings made under this subchapter during 2-year period beginning Oct. 1, 2002, to be treated as a separate program of the Small Business Administration for purposes of the Federal Credit Reform Act of 1990 (2 U.S.C. 661 et seq.) only, see
[section 6(c) of Pub. L. 107–100], set out as a note under section 636 of this title.
Loan Liquidation Pilot Program
[Pub. L. 104–208, div. D, title II, § 204], Sept. 30, 1996, [110 Stat. 3009–736], provided that:
The Administrator shall carry out a loan liquidation pilot program (in this section referred to as the ‘pilot program’) in accordance with the requirements of this section.
Selection of Development Companies.—
Not later than 90 days after the date of the enactment of this Act [Sept. 30, 1996
], the Administrator shall establish a pilot program under which certain development companies authorized to make loans and issue debentures under title V of the Small Business Investment Act of 1958 [15 U.S.C. 695
et seq.] are selected by the Administrator in accordance with this subsection to carry out loan liquidations.
Conflicts of interest.—
The development companies selected under paragraph (1) shall agree not to take any action that would create a potential conflict of interest involving the development company, the third party lender, or an associate of the third party lender.
In order to qualify to participate in the pilot program under this section, each development company shall—
have not less than 6 years of experience in the program established by title V of the Small Business Investment Act of 1958;
have made, during the 6 most recent fiscal years, an average of not less than 10 loans per year through the program established by such title V of the Small Business Investment Act of 1958;
have not less than 2 years of experience in liquidating loans under the authority of a Federal, State, or other lending program; and
meet such other requirements as the Administration may establish.
Authority of Development Companies.—
The development companies selected under subsection (b) shall, for loans in their portfolio of loans made through debentures guaranteed under title V of the Small Business Investment Act of 1958 [15 U.S.C. 695
et seq.] that are in default after the date of enactment of this Act [Sept. 30, 1996
], be authorized to—
perform all liquidation and foreclosure functions, including the acceleration or purchase of community injection funds, subject to such company obtaining prior written approval from the Administrator before committing the agency to purchase any other indebtedness secured by the property: Provided, That the Administrator shall approve or deny a request for such purchase within a period of 10 business days; and
liquidate such loans in a reasonable and sound manner and according to commercially accepted practices pursuant to a liquidation plan approved by the administrator in advance of its implementation. If the administrator does not approve or deny a request for approval of a liquidation plan within 10 business days of the date on which the request is made (or with respect to any routine liquidation activity under such a plan, within 5 business days) such request shall be deemed to be approved.
Authority of the Administrator.—
In carrying out the pilot program, the Administrator shall—
have full authority to rescind the authority granted any development company under this section upon a 10-day written notice stating the reasons for the rescission; and
not later than 90 days after the admission of the development companies specified in subsection (b), implement the pilot program.
The Administrator shall issue a report on the results of the pilot program to the Committees on Small Business of the House of Representatives and the Senate [Committee on Small Business of Senate now Committee on Small Business and Entrepreneurship of Senate]. The report shall include information relating to—
the total dollar amount of each loan and project liquidated;
the total dollar amount guaranteed by the Administration;
total dollar losses;
total recoveries both as percentage of the amount guaranteed and the total cost of the project; and
a comparison of the pilot program information with the same information for liquidation conducted outside the pilot program over the period of time.
The report shall be based on data from, and issued not later than 90 days after the close of, the first eight 8 [sic] fiscal quarters of the pilot program’s operation after the date of implementation.”
[Section 204 of title II of div. D of Pub. L. 104–208], set out above, to cease to have effect beginning on the date on which final regulations are issued to carry out section 697g of this title, see section 1(a)(9) [title III, § 307(b)] of [Pub. L. 106–554], set out as a Regulations note under section 697g of this title.]