Penalty. Terms may be extended. program, consent to the suspension of the payments of the principal of that loan, mortgage, or lien during the lifetime of that individual and his spouse for so long as the Administration determines that making such payments would constitute a substantial hardship; (D) shall, notwithstanding the provisions of any other law and upon presentation by the applicant of proof of loss or damage or injury and a bona fide estimate of cost of repair, rehabilitation, or replacement, cancel the principal of any loan made to cover a loss or damage or injury resulting from such disasthat ter, except with respect to a loan made in connection with a disaster occurring on or after January 1, 1971, but prior to January 1, 1972, the total amount so canceled shall not exceed $2,500, and the interest on the balance of the loan shall be at a rate of 3 per centum per annum; and (ii) with respect to a loan made in connection with a disaster occurring on or after January 1, 1972 but prior to July 1, 1973, the total amount so canceled shall not exceed $5,000, and the interest on the balance of the loan shall be at a rate of 1 per centum per annum.36 With respect to any loan referred to in clause (D) which is outstanding on the date of enactment of this paragraph, the Administrator shall (i) make such change in the interest rate on the balance of such loan as is required under that clause effective as of such date of enactment; and (ii) in applying the limitation set forth in that clause with respect to the total amount of such loan which may be canceled, consider as part of the amount so canceled any part of such loan which was previously canceled pursuant to section 231 of the Disaster Relief Act of 1970. Whoever wrongfully misapplies the proceeds of a loan obtained under this subsection shall be civilly liable to the Administrator in an amount equal to one-and-onehalf times the original principal amount of the loan.37 (c) (1) The Administration may further extend the maturity of or renew any loan made pursuant to this section, or any loan transferred to the Administration 38 See footnotes 34 and 35 for modification of interest rate and elimination of cancellation benefit. 37 The matter following the numbered paragraphs of section 7(b) rewritten by section 1(a) of PL 92-385, approved August 16, 1972 (86 Stat. 554). Section 1(b) of PL 92-385 provides that the paragraph which provided for a civil penalty shall apply only with respect to loans made on or after August 16, 1972; and section 1(c) provides that any person who (1) suffers any loss or damage as a result of a major disaster as determined by the President which occurred prior to the date of enactment of this Act; (2) is eligible for assistance under the amendment made by subsection (a); and (3) is otherwise eligible for benefits greater than those provided by the amendment made by subsection (a), may elect to receive such greater benefits. pursuant to Reorganization Plan Numbered 2 of 1954, or Reorganization Plan Numbered 1 of 1957, for additional periods not to exceed ten years beyond the period stated therein, if such extension or renewal will aid in the orderly liquidation of such loan. (2) During any period in which principal and interest charges are suspended on the Federal share of any loan, as provided in subsection (b), the Administrator shall, upon the request of any person, firm, or corporation having a participation in such loan, purchase such participation, or assume the obligation of the borrower, for the balance of such period, to make principal and interest payments on the non-Federal share of such loan: Provided, That no such payments shall be made by the Administrator in behalf of any borrower unless (i) the Administrator determines that such action is necessary in order to avoid a default, and (ii) the borrower agrees to make payments to the Administration in an aggregate amount equal to the amount paid in its behalf by the Administrator, in such manner and at such times (during or after the term of the loan) as the Administrator shall determine having due regard to the purposes sought to be achieved by this paragraph.38 grants. (d) The Administration also is empowered to make Research grants to any State government or any agency thereof, 15 u.s.C. any State-chartered development credit or finance cor- 686(d). poration, any land-grant college or university, any college or school of business, engineering, commerce, or agriculture, or to any corporation formed by two or more of the entities hereinabove described which are eligible to receive such grants, for studies, research, and counseling concerning the managing, financing, and operation. of small business enterprises and technical and statistical information necessary thereto in order to carry out the purposes of section 8(b) (1) by coordinating such information with existing information facilities within the State and by making such information available to State and local agencies. The Administrator may recommend to grant applicants particular studies or research which are to be financed by such grants. The total of all grants (including amendments and modifications thereof) made under this subsection within any one State in any one year shall not exceed $40,000. The Administration may require, as a condition to any grant (or amendment or modification thereof) made under this subsection, that an additional amount not exceeding the amount of such grant be provided from sources other than the Administration to assist in carrying out the purposes for which such grant is made: Provided, That if such grant or any part thereof is to be utilized for the purpose of providing 38 Section 7(c) (2) added by section 1(b) of PL 89-59, approved June 30, 1965, (79 Stat. 206). Note also section 5 (e) added by section 303 of PL 95-89, August 4, 1977. Trade adjust- Disaster loan counseling services to individual small business enterprises the Administration shall require that such additional amount be provided and in an amount which is equal to the amount of such grant. What constitutes such additional amount may be defined by the Administration.39 (e) The Administration also is empowered to make loans (either directly or in cooperation with banks or other lenders through agreements to participate on an immediate or deferred basis) to assist any firm to adjust to changed economic conditions resulting from increased competition from imported articles, but only if (1) an adjustment proposal of such firm has been certified by the Secretary of Commerce pursuant to the Trade Expansion Act of 1962, (2) the Secretary has referred such proposal to the Administration under that Act and the loan would provide part or all of the financial assistance necessary to carry out such proposal, and (3) the Secretary's certification is in force at the time the Administration makes the loan. With respect to loans made under this subsection the Administration shall apply the provisions of sections 314, 315, 316, 318, 319, and 320 of the Trade Expansion Act of 1962 as though such loans had been made under section 314 of that Act.40 (f) 41 In the administration of the disaster loan program under subsection (b) (1) of this section, in the case of property loss or damage as a result of a disaster which is a "major disaster" as defined in section 2(a) of the Act of September 30, 1950 (42 U.S.C. 1855a (a)),42 the Small Business Administration, to the extent such loss or damage is not compensated for by insurance or otherwise, may lend to a privately owned college or university without regard to whether the required financial assistance is otherwise available from private sources, and may waive 39 Section 7(d) added by section 602(c) of PL 85-699, the Small Business Investment Act of 1958, approved August 21, 1958 (72 Stat. 698) and rewritten by section 9 of PL 87-305, the Small Business Act Amendments of 1961, approved September 26, 1961. (75 Stat. 668). 40 Section 7(e), effective July 1, 1966. added by section 3 of PL 89-409. approved May 2, 1966 (80 Stat. 133), which simultaneously repealed section 2 of PL 87-550, approved July 25, 1962 (76 Stat. 221), (containing the same authority) and transferred any expended balances of appropriations heretofore appropriated for the purpose of such section to the business loan and investment fund established by section 4(c)(1) of the Small Business Act. Section 602 (f) of PL 93-618, the Trade Act of 1974, approved January 3, 1975 (88 Stat. 1978), provides that existing references to the 1962 Act shall be construed to refer also to the 1974 Act unless precluded by the context. Section 602 (e) of the 1974 Act also repealed, among others, sections 314 and 315 of the 1962 Act, effective on the 90th day following the enactment of the 1974 Act, thus leaving in effect sections 316, 318, 319, and 320 of the 1962 Act, which are referred to in this section of the Small Business Act. The last four enumerated sections provide continuing authority for administering loans made under authority of the 1962 Act and for other actions incidental thereto. 41 Section 7(f) added by section 7(b) of PL 89-769, the Disaster Relief Act of 1966, approved November 6, 1966 (80 Stat. 1319), and inadvertently labelled as section "e". Redesignated as section "f" by section 104 of PL 90-104, the Small Business Act Amendments of 1967, approved October 11, 1967. (81 Stat. 268). 42 The reference to the 1950 Act previously deemed to be a reference to the Disaster Relief Act of 1970, PL 91-606, approved December 31, 1970 (84 Stat. 1744), by virtue of section 301(7) thereof, is now deemed to be a reference to the Disaster Relief Act of 1974 by virtue of section 602 (m) thereof. "Major disaster" is defined in section 102 (2) of the 1974 Act. pollution 15 U.S.C. interest payments and defer principal payments on such (A) shall be made in accordance with provisions (B) shall be made only if the applicant furnishes the Administration with a statement in writing from the Environmental Protection Agency, or if appropriate, the State, that such additions or alterations are necessary and adequate to comply with requirements established under the Federal Water Pollution Control Act. (3) The Administrator of the Environmental Protection Agency shall, as soon as practicable after the date of enactment of the Federal Water Pollution Control Act Amendments of 1972 and not later than one hundred and eighty days thereafter, promulgate regulations establishing uniform rules for the issuance of statements for the purpose of paragraph (2) (B) of this subsection. 15 U.S.C. (h) (1) The Administration also is empowered, where Handicapped other financial assistance is not available on reasonable Individuals. terms, to make such loans (either directly or in coopera- 636 (h). tion with Banks or other lending institutions through agreements to participate on an immediate or deferred basis) as the Administration may determine to be necessary or appropriate (A) to assist any public or private organization (i) which is organized under the laws of the United States or of any State, operated in the interest of handicapped individuals, the net income of which does not inure in whole or in part to the benefit of any shareholder or other individual; 43 Added by section 8(a) of PL 92-500, the Federal Water Pollution Control Act Amendments of 1972, enacted October 18, 1972. (86 Stat. 816). 44 This section added by section 3(b) of PL 92-595, the Small Business Investment Act Amendments of 1972, approved October 27, 1972 (86 Stat. 1314), was also denominated section 7(g), apparently inadvertently. Redesignated section 7 (h) by section 3 (a) of PL 93-237, approved January 2, 1974. (87 Stat. 1023). Handicapped individual defined. Concerns in urban or rural areas. 15 U.S.C. 636 (i). (ii) which complies with any applicable occupational health and safety standard prescribed by the Secretary of Labor; and (iii) which, in the production of commodities and in the provision of services during any fiscal year in which it receives financial assistance under this subsection, employs handicapped individuals for not less than 75 per centum of the man-hours required for the production or provision of the commodities or services; or (B) to assist any handicapped individual in establishing, acquiring, or operating a small business concern. (2) The Administration's share of any loan made under this subsection shall not exceed $350,000, nor may any such loan be made if the total amount outstanding and committed (by participation or otherwise) to the borrower from the business loan and investment fund established by section 4(c) (1) (B) of this Act would exceed $350,000. In agreements to participate in loans on a deferred basis under this subsection, the Administration's participation may total 100 per centum of the balance of the loan at the time of disbursement. The Administration's share of any loan made under this subsection shall bear interest at the rate of 3 per centum per annum.45 The maximum term of any such loan, including extensions and renewals thereof, may not exceed fifteen years. All loans made under this subsection shall be of such sound value or so secured as reasonably to assure repayment: Provided, however, That anv. reasonable doubt shall be resolved in favor of the applicant. (3) For purposes of this subsection, the term "handicapped individual" means a person who has a physical, mental, or emotional impairment, defect, ailment, disease, or disability of a permanent nature which in any way limits the selection of any type of employment for which the person would otherwise be qualified or qualifiable. ! (i) (1) 46 The Administration also is empowered to make, participate (on an immediate basis) in, or guarantee loans, repayable in not more than fifteen years, to any small business concern, or to any qualified person seeking to establish such a concern. when it determines that such loans will further the policies established in section 2(b) of this Act, with particular emphasis on the preservation or establishment of small business concerns 45 Sentence amended by section 3(2) of PL 93-386. the Small Business Amendments of 1974, approved August 23, 1974 (88 Stat. 742), to clarify the rate of interest on SBA's loans to handicapped persons. Loans made in conjunction with private lenders will bear a rate of interest set by borrowers, but SBA's share of such loan shall remain at 3 per centum per annum. 46 Added by section 2(a)(4) of PL 93-386, the Small Business Amendments, of 1974, approved August 23, 1974 (88 Stat. 742), to transfer the authority for the economic opportunity loan program from Title IV of the Economic Opportunity Act of 1964. |