Kerry, Snowe Praise Passage of Disaster Loan Program
Today Senators John Kerry (D-Mass.) and Olympia Snowe (R-Maine) praised the Senate's passage of a critical disaster reform provision that will improve assistance to business owners and homeowners after a disaster. The amendment, based on a bipartisan bill authored by Kerry and Snowe, passed as part of the Farm Bill, H.R. 2419. The provisions which have been negotiated over more than two years are needed to prevent future disaster response failure and are timely in light of the recent disaster declarations in Washington state and California.
"When Katrina hit, the Gulf Coast was twice victimized, first by the storm and then by government inaction," said Senator Kerry, Chairman of the Committee on Small Business and Entrepreneurship. "Today we've passed this legislation so that the victims of the recent fires and floods, and victims of future disasters don't suffer the same fate. In order to get assistance to those who need it immediately in California and Washington, or the fires and floods of tomorrow, I urge the President to act quickly and sign this bill into law."
"Today's passage of SBA disaster assistance represents a major improvement in the SBA's ability to aggressively respond to future disasters," said Senator Snowe, Ranking Member of the Committee on Small Business and Entrepreneurship. "Through this bipartisan measure, we have bolstered the Agency's capacity to assist small businesses with the same dedication to excellence exemplified by the entrepreneurs it strives to serve."
The amendment passed today by the Senate is nearly identical to legislation sponsored by Kerry and Snowe, the Small Business Disaster Response and Loan Improvements Act (S. 163), which unanimously passed the Senate in August.
Specifically the amendment:
# Establishes a Private Disaster Loan program to be used in the aftermath of catastrophic disasters, allowing banks to make loans directly to victims with an 85 percent government guarantee;
# Creates a new expedited disaster assistance business loan program to provide short-term relief to businesses damaged or destroyed in catastrophic disasters while they await other federal assistance or insurance payments;
# Creates a new presidential declaration of "Catastrophic National Disaster," which will allow the Small Business Administration (SBA) to issue nationwide economic injury disaster loans to small businesses affected by a large-scale disaster;
# Provides key tools for processing disaster loan applications more quickly, such as working with qualified private contractors to process the loans and requiring the SBA to report to Congress on how the application process can be improved; and
# Increases the maximum size of a disaster loan from $1.5 million to $2 million and allows non-profit groups to be eligible for disaster loans.