From the Office of Senator Kerry

Thursday, January 24, 2002

WASHINGTON, D.C. - Several key provisions of Sen. John F. Kerry's American Small Business Emergency Relief and Recovery Act were signed into law as part of the 2002 Defense Appropriations Bill. While Sen. Kerry (D-Mass.) intends to continue his fight to pass S.1499, held hostage by two Republicans in the Senate, the following provisions included in the Defense Appropriations Bill by Kerry will deliver emergency assistance to small businesses adversely affected by the events of Sept. 11 and their aftermath:

Appropriates $150 million in additional funding to the SBA to cope with the disaster -- $75 million of which will go toward making 7(a) guaranteed loans for small business disaster victims.

Nonprofits and nondepository financial institutions will now be able to apply for disaster loans.

Gives the SBA administrator discretion to use increased size standards of small businesses, as such standards may be increased during the one-year period following the date of enactment of this legislation.

Extends the deferral of payment of interest and principal on disaster loans from one year to two years and prohibits the accrual of interest during the deferral period.

Raises the ceiling on the maximum amount a small business disaster victim can borrow from the $1.5 million to $10 million.

Decreases the annual 7(a) guaranteed lending fee by half.

Sponsored by Kerry, chairman of the Committee on Small Business & Entrepreneurship, and Ranking Member Christopher "Kit" Bond (R-Mo.), The America Small Business Relief and Recovery Act has the support of 62 co-sponsors and thousands of small business representatives, owners and employees around the nation. Reps. Donald Manzullo (R-Ill.) and James Moran (D-Va.) sponsored the companion bill in the House, H.R. 3338.

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