How HR 3730 changes current law

Compared against current U.S. Code AI-generated reading aid — verify against the official bill.

The bill enhances loan guarantee provisions and eligibility requirements for small manufacturers under the Small Business Act and the Small Business Investment Act of 1958.

• 15 U.S.C. 636(a)(2)

  and (E) → (E), and (F)

  This change adds a new category for manufacturers in the loan participation agreement, increasing the maximum participation for their loans.

• 15 U.S.C. 636(a)(2)

  (F) Participation for manufacturers.-- (i) In general.--In an agreement to participate in a loan on a deferred basis under this subsection for a small business concern assigned to a North American Industry Classification System code for manufacturing or that is designated by the Administrator under clause (ii), the participation by the Administration shall be 90 percent. (ii) Addition of advanced manufacturing sectors.--After submitting notice to the Committee on Small Business and Entrepreneurship of the Senate and the Committee on Small Business of the House of Representatives, the Administrator may designate a North American Industry Classification System code for purposes of clause (i) if the Administrator determines the code-- (I) is not a manufacturing code under the North American Industry Classification System; and (II) corresponds to a sector in which manufacturing is a considerable component of the operations of a small business concern, as determined by the Administrator, including advanced manufacturing.

  This clause establishes that the SBA may guarantee 90% of loans for manufacturers, thereby increasing financial support for small manufacturers.

• 15 U.S.C. 636(a)(18)

  With respect → Except as provided in subparagraph (C), with respect

  This change clarifies conditions under which guarantee fees apply to loan guarantees.

• 15 U.S.C. 636(a)(18)

  (C) Manufacturers.-- (i) In general.--Subject to clause (ii), with respect to a loan guaranteed under this subsection for a small business concern described in paragraph (2)(F)(i)-- (I) the Administration may not collect a guarantee fee under this paragraph for a loan of not more than $350,000; and (II) for a loan of more than $350,000, the Administration shall collect a guarantee fee under this paragraph equal to 50 percent of the guarantee fee that the Administration would otherwise collect for the loan.

  This provision reduces or eliminates guarantee fees for loans to small manufacturers, making loans more accessible.

• 15 U.S.C. 696(2)(A)(iii)

  $5,500,000 → $10,000,000

  This amendment increases the maximum loan amount to small manufacturers to $10 million, facilitating larger projects.

• 15 U.S.C. 696(3)(C)

  at least 15 percent of the total cost of the project financed → at least 5 percent of the total cost of the project financed

  This change reduces the required contribution from small manufacturers for funded projects, easing financing requirements.

• 15 U.S.C. 695(e)(1)

  creates or retains → creates or retains 1 job for every $75,000 guaranteed by the Administration, except that the amount is $150,000 in the case of a project of a small manufacturer.

  This establishes a less stringent job creation standard for small manufacturers.

• 15 U.S.C. 696(5)

  In addition → (A) In general.--Except as provided in subparagraph (B), in addition

  This change sets a standard occupancy requirement while allowing exceptions for small manufacturers.

• 15 U.S.C. 696(3)(E)(i)

  Additional collateral shall not be required in the case of a small manufacturer (as defined in section 501(e)(7)).

  This exemption allows small manufacturers to obtain loans without requiring additional collateral, improving access to funds.

• 15 U.S.C. 696(7)(B)

  (or in the case of a small manufacturer (as defined in section 501(e)(7)) that does not exceed 100 percent of the project cost of the expansion)

  This provision facilitates debt refinancing for small manufacturers.

• 15 U.S.C. 697(a)

  Any debenture issued by a State or local development company to a small manufacturer (as defined in section 501(e)(7)) with respect to which a guarantee is made under this subsection shall be in an amount equal to not more than 50 percent of the cost of the project with respect to which such debenture is issued, without regard to whether good cause has been shown.

  This provides clarity on agreements related to debenture issuance for small manufacturers.