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Small Business Disaster Damage Fairness Act of 2025

S. 397 · 119th Congress · Feb 4, 2025 · Lineage

A BILL

To amend the Small Business Act to increase the minimum disaster loan amount for which the Small Business Administration may require collateral, and for other purposes.

Section 1 Short title

This Act may be cited as the “Small Business Disaster Damage Fairness Act of 2025”.

Sec. 2 Collateral requirements for disaster loans

Section 7(d)(6) of the Small Business Act (15 U.S.C. 636(d)(6)) is amended, in the second sentence, in the third proviso—
(1)
by striking “$14,000” and inserting “$50,000”; and
(2)
by striking “major disaster” and inserting “disaster”.

Sec. 3 GAO report on default rates

Not later than 3 years after the date of enactment of this Act, the Comptroller General of the United States 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 on the performance, including the default rate, of loans made under section 7(b)(1) of the Small Business Act (15 U.S.C. 636(b)(1)), and the impact of the amendments to collateral amounts made under section 2 of this Act on the performance of those loans, during the period—
(1)
beginning on September 30, 2020; and
(2)
ending on the date on that is 2 years after the date of enactment of this Act.

Sec. 4 Distinguishing between rural and urban communities in marketing and outreach

(a)
Definitions— In this section:
(1)
Administration— The term Administration means the Small Business Administration.
(2)
Administrator— The term Administrator means the Administrator of the Administration.
(3)
Associate Administrator— The term Associate Administrator means the Associate Administrator of the Office of Disaster Recovery and Resilience of the Administration.
(4)
Covered program— The term covered program means the disaster loan program authorized by section 7(b) of the Small Business Act (15 U.S.C. 636(b)).
(b)
Requirement— Beginning on the date of enactment of this Act, consistent with the recommendations of the Government Accountability Office in the report entitled “Small Business Administration: Targeted Outreach about Disaster Assistance Could Benefit Rural Communities” (GAO–24–106755) (February 22, 2024), the Administrator shall ensure that the Associate Administrator—
(1)
distinguishes between rural and urban communities in the outreach and marketing plan of the Administration with respect to the covered program; and
(2)
incorporates actions to mitigate challenges encountered by rural communities in accessing loans under the covered program.