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Small Business Disaster Damage Fairness Act of 2025
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.
Summary
This bill increases the minimum disaster loan amount from the Small Business Administration that requires collateral from $14,000 to $50,000, allowing small businesses to borrow smaller amounts without pledging collateral. It also expands the collateral waiver to apply to all declared disasters, not just major disasters. The bill requires the Government Accountability Office to submit a report within three years assessing the default rates of SBA disaster loans and analyzing how the increased collateral threshold affects loan performance. Additionally, it directs the SBA to tailor its outreach and marketing for disaster assistance programs differently for rural and urban communities, and to take specific actions to address barriers that rural communities face in accessing disaster loans, based on recommendations from a 2024 GAO report.
AI-generated plain-language summary of the bill text — neutral, and may be imperfect. See the full text below for the exact wording.
Sponsor (1)
- Sen. Kennedy, John [R-LA] (R-LA)
2 cosponsors
- Sen. Booker, Cory A. [D-NJ] (D-NJ)
- Sen. Hirono, Mazie K. [D-HI] (D-HI)
Actions (2)
- Feb 4, 2025 Read twice and referred to the Committee on Small Business and Entrepreneurship. · senate
- Feb 4, 2025 Introduced in Senate
Similar bills (6)
Bills with similar text or summary — includes reintroductions across Congresses. Ranked by semantic similarity of the bill text (computed locally); a neutral discovery aid, not a claim the bills are duplicates.
Full text
IN THE SENATE OF THE UNITED STATES
February 4, 2025
Mr. Kennedy (for himself, Mr. Booker, and Ms. Hirono) introduced the following bill; which was read twice and referred to the Committee on Small Business and Entrepreneurship
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.
Be it enacted by the Senate and House of Representatives of the United States of America in Congress assembled,
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. <all>
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