HR 2389 IHCommentsClose CommentsPermalink

To help small businesses to develop, invest in, and purchase energy efficient buildings, fixtures, equipment, and technology.CommentsClose CommentsPermalink

May 17, 2007

Mr. SHULER (for himself and Ms. VELAZQUEZ) introduced the following bill; which was referred to the Committee on Small BusinessCommentsClose CommentsPermalink

To help small businesses to develop, invest in, and purchase energy efficient buildings, fixtures, equipment, and technology.CommentsClose CommentsPermalink

Be it enacted by the Senate and House of Representatives of the United States of America in Congress assembled,CommentsClose CommentsPermalink

SECTION 1. SHORT TITLE; TABLE OF CONTENTS.

(a) Short Title- This Act may be cited as the `Small Energy Efficient Businesses Act'.CommentsClose CommentsPermalink





(b) Table of Contents- The table of contents for this Act is as follows:CommentsClose CommentsPermalink





Sec. 1. Short title; table of contents.CommentsClose CommentsPermalink





Sec. 2. Findings.CommentsClose CommentsPermalink





Sec. 3. Larger 504 loan limits to help business develop energy efficient technologies and purchases.CommentsClose CommentsPermalink





Sec. 4. Reduced 7(a) fees and higher loan guarantees for purchase of energy efficient technologies.CommentsClose CommentsPermalink





Sec. 5. Small Business Sustainability Initiative.CommentsClose CommentsPermalink





Sec. 6. Small Business Administration to educate and promote energy efficiency ideas to small businesses and work with the small business community to make such information widely available.CommentsClose CommentsPermalink





Sec. 7. Energy saving debentures.CommentsClose CommentsPermalink





Sec. 8. Investments in energy saving small businesses.CommentsClose CommentsPermalink





Sec. 9. Renewable fuel capital investment company.CommentsClose CommentsPermalink





Sec. 10. Study and report.CommentsClose CommentsPermalink

SEC. 2. FINDINGS.

Congress finds the following:CommentsClose CommentsPermalink





(1) Energy efficiency is in our national interest for our long term economic well being, for the health and safety of our citizens and the world, and for our independence and security.CommentsClose CommentsPermalink





(2) Small businesses are more efficient, nimble, and innovative than large businesses and therefore more likely to integrate and benefit from energy efficient technology advances and upgrades, but they are less likely to have the capital to institute these advances quickly.CommentsClose CommentsPermalink





(3) The majority of businesses (two-thirds) say they have been unable to invest in comprehensive energy efficiency programs for their businesses thus far, though they know of them and believe they are effective.CommentsClose CommentsPermalink





(4) A pilot program has demonstrated that individualized counseling and training combined with loan and grant availability and other incentives are very popular and effective in helping small businesses learn about and adopt energy conservation methods.CommentsClose CommentsPermalink





(5) The energy saving benefit of such programs, if they can be implemented on a national basis, would contribute significantly to our energy independence and security.CommentsClose CommentsPermalink





(6) New and emerging technologies are on the rise, and small businesses are leading the way, for example the vast majority of renewable fuels producers, such as biodiesel and ethanol, are small businesses.CommentsClose CommentsPermalink





(7) Small businesses currently use almost half of the Nation's business related energy consumption and employ half of the Nation's workforce, yet the Energy Star program, the lead Federal energy efficiency program allocates less than 2 percent of its resources to its small business program and should allocate more to educate small businesses.CommentsClose CommentsPermalink





(8) Therefore, it is in the national interest for the Federal Government to invest in incentives in the form of improved loan terms, additional investment inducements, and expert counseling and information to assist small businesses to develop, invest in, and purchase energy efficient buildings, equipment, fixtures, and other technology.CommentsClose CommentsPermalink

SEC. 3. LARGER 504 LOAN LIMITS TO HELP BUSINESS DEVELOP ENERGY EFFICIENT TECHNOLOGIES AND PURCHASES.

(a) Eligibility for Energy Efficiency Projects- Section 501(d)(3) of the Small Business Investment Act of 1958 (15 U.S.C. 695(d)(3)) is amended--CommentsClose CommentsPermalink





(1) in subparagraph (G) by striking `or' at the end;CommentsClose CommentsPermalink





(2) in subparagraph (H) by striking the period at the end and inserting a comma; andCommentsClose CommentsPermalink





(3) by inserting after subparagraph (H) the following:CommentsClose CommentsPermalink





`(I) reduction of energy consumption by at least 10 percent,CommentsClose CommentsPermalink





`(J) increased use of sustainable design or low-impact design to produce buildings that reduce the use of non-renewable resources, minimize environmental impact, and relate people with the natural environment, orCommentsClose CommentsPermalink





`(K) plant, equipment and process upgrades of renewable energy sources such as micropower or renewable fuels producers including biodiesel and ethanol producers.'.CommentsClose CommentsPermalink





(b) Loans for Plant Projects Used for Energy-Efficient Purposes- Section 502(2)(A) of the Small Business Investment Act of 1958 (15 U.S.C. 696(2)(A)) is amended--CommentsClose CommentsPermalink





(1) in clause (ii) by striking `and' at the end;CommentsClose CommentsPermalink





(2) in clause (iii) by striking the period at the end and inserting a semicolon; andCommentsClose CommentsPermalink





(3) by adding at the end the following new clauses:CommentsClose CommentsPermalink





`(iv) $4,000,000 for each project that reduces the borrower's energy consumption by at least 10 percent; andCommentsClose CommentsPermalink





`(v) $4,000,000 for each project that generates renewable energy or renewable fuels, such as biodiesel or ethanol production.'.CommentsClose CommentsPermalink

SEC. 4. REDUCED 7(a) FEES AND HIGHER LOAN GUARANTEES FOR PURCHASE OF ENERGY EFFICIENT TECHNOLOGIES.

Section 7(a) of the Small Business Act (15 U.S.C. 636(a)) is amended by adding at the end the following:CommentsClose CommentsPermalink





`(35) LOANS FOR ENERGY EFFICIENT TECHNOLOGIES- The Administrator shall carry out a program for loans the proceeds of which are used to purchase energy efficient equipment or fixtures or to reduce the energy consumption of the borrower, including, but not limited to, renewable fuels and energy products such as biodiesel and ethanol, by 10 percent or more. For a loan made under this paragraph, the following shall apply:CommentsClose CommentsPermalink





`(A) The loan shall include the participation by the Administration equal to 90 percent of the balance of the financing outstanding at the time of disbursement.CommentsClose CommentsPermalink





`(B) The fees on the loan under paragraphs (18) and (23) shall be reduced by half.'.CommentsClose CommentsPermalink

SEC. 5. SMALL BUSINESS SUSTAINABILITY INITIATIVE.

Section 21 of the Small Business Act (15 U.S.C. 648) is amended by adding at the end the following:CommentsClose CommentsPermalink





`(n) Small Business Sustainability Initiative-CommentsClose CommentsPermalink





`(1) IN GENERAL- A Small Business Development Center may apply for an additional grant to carry out a small business sustainability initiative program.CommentsClose CommentsPermalink





`(2) ELEMENTS OF PROGRAM- Under a program under paragraph (1), the Center shall--CommentsClose CommentsPermalink





`(A) provide necessary support to smaller and medium-sized businesses to--CommentsClose CommentsPermalink





`(i) evaluate energy efficiency and green building opportunities;CommentsClose CommentsPermalink





`(ii) evaluate renewable energy sources such as the use of solar and small wind to supplement power consumption;CommentsClose CommentsPermalink





`(iii) secure financing to achieve energy efficiency or to construct green buildings; andCommentsClose CommentsPermalink





`(iv) empower management to implement energy efficiency projects;CommentsClose CommentsPermalink





`(B) assist entrepreneurs with clean technology development and technology commercialization through--CommentsClose CommentsPermalink





`(i) technology assessment;CommentsClose CommentsPermalink





`(ii) intellectual property;CommentsClose CommentsPermalink





`(iii) Small Business Innovation Research submissions;CommentsClose CommentsPermalink





`(iv) strategic alliances;CommentsClose CommentsPermalink





`(v) business model development; andCommentsClose CommentsPermalink





`(vi) preparation for investors; andCommentsClose CommentsPermalink





`(C) help small business improve environmental performance by shifting to less hazardous materials and reducing waste and emissions at the source, including by providing assistance for businesses to adapt the materials they use, the processes they operate, and the products and services they produce.CommentsClose CommentsPermalink





`(3) MINIMUM AMOUNT- Each grant under this subsection shall be for at least $150,000.CommentsClose CommentsPermalink





`(4) MAXIMUM AMOUNT- A grant under this subsection may not exceed $300,000.CommentsClose CommentsPermalink





`(5) AUTHORIZATION OF APPROPRIATIONS- Subject to amounts approved in advance in appropriations Acts and separate from amounts approved to carry out section 21(a)(1), the Administrator may make grants or enter into cooperative agreements to carry out the provisions of this subsection.'.CommentsClose CommentsPermalink

SEC. 6. SMALL BUSINESS ADMINISTRATION TO EDUCATE AND PROMOTE ENERGY EFFICIENCY IDEAS TO SMALL BUSINESSES AND WORK WITH THE SMALL BUSINESS COMMUNITY TO MAKE SUCH INFORMATION WIDELY AVAILABLE.

The Small Business Act is amended--CommentsClose CommentsPermalink





(1) by redesignating section 37 as section 99; andCommentsClose CommentsPermalink





(2) by inserting after section 36 (15 U.S.C. 657f) the following:CommentsClose CommentsPermalink

`SEC. 37. PROGRAM TO PROVIDE EDUCATION ON ENERGY EFFICIENCY.

`(a) Program Required- The Administrator shall develop and coordinate a Government-wide program, building on the Energy Star for Small Business program, to assist small businesses in--CommentsClose CommentsPermalink





`(1) becoming more energy efficient;CommentsClose CommentsPermalink





`(2) understanding the cost savings from improved energy efficiency; andCommentsClose CommentsPermalink





`(3) identifying financing options for energy efficiency upgrades.CommentsClose CommentsPermalink





`(b) Consultation and Cooperation- The program required by subsection (a) shall be developed and coordinated--CommentsClose CommentsPermalink





`(1) in consultation with the Secretary of Energy and the Administrator of the Environmental Protection Agency; andCommentsClose CommentsPermalink





`(2) in cooperation with any entities the Administrator considers appropriate, such as industry trade associations, industry members, and energy efficiency organizations.CommentsClose CommentsPermalink





`(c) Availability of Information- The Administrator shall make available the information and materials developed under the program required by subsection (a) to--CommentsClose CommentsPermalink





`(1) small businesses; andCommentsClose CommentsPermalink





`(2) other Federal programs for energy efficiency, such as the Energy Star for Small Business program.CommentsClose CommentsPermalink





`(d) Strategy and Report-CommentsClose CommentsPermalink





`(1) STRATEGY REQUIRED- The Administrator shall develop a strategy to educate, encourage, and assist small business to adopt energy efficient building fixtures and equipment.CommentsClose CommentsPermalink





`(2) REPORT- Not later than December 31, 2008, the Administrator shall submit to Congress a report containing a plan to implement the strategy.'.CommentsClose CommentsPermalink

SEC. 7. ENERGY SAVING DEBENTURES.

Section 303 of the Small Business Investment Act of 1958 (15 U.S.C. 683) is amended by adding at the end the following new subsection:CommentsClose CommentsPermalink





`(k) Energy Saving Debentures-CommentsClose CommentsPermalink





`(1) IN GENERAL- In addition to any other authority under this Act, a small business investment company licensed after September 30, 2007, shall have authority to issue Energy Saving debentures.CommentsClose CommentsPermalink





`(2) ENERGY SAVING DEBENTURE DEFINED- As used in this Act, the term `Energy Saving debenture' means a deferred interest debenture that--CommentsClose CommentsPermalink





`(A) is issued at a discount;CommentsClose CommentsPermalink





`(B) has a five-year maturity or a ten-year maturity;CommentsClose CommentsPermalink





`(C) requires no interest payment or annual charge for the first five years;CommentsClose CommentsPermalink





`(D) is restricted to Energy Saving qualified investments; andCommentsClose CommentsPermalink





`(E) is issued at no cost (as defined in section 502 of the Credit Reform Act of 1990) with respect to purchasing and guaranteeing the debenture.CommentsClose CommentsPermalink





`(3) ENERGY SAVING QUALIFIED INVESTMENT DEFINED- As used in this Act, the term `Energy Saving qualified investment' means investment in a small business that is primarily engaged in researching, manufacturing, developing, or providing products, goods, or services that reduce the use or consumption of non-renewable energy resources.'.CommentsClose CommentsPermalink

SEC. 8. INVESTMENTS IN ENERGY SAVING SMALL BUSINESSES.

(a) Maximum Leverage- Paragraph (2) of subsection (b) of section 303 of the Small Business Investment Act of 1958 (15 U.S.C. 303(b)(2)) is amended by adding at the end the following new subparagraph:CommentsClose CommentsPermalink





`(D) INVESTMENTS IN ENERGY SAVING SMALL BUSINESSES- In calculating the outstanding leverage of a company for purposes of subparagraph (A), the Administrator shall not include the amount of the cost basis of any Energy Saving qualified investment (as defined in subsection (k)) made after September 30, 2007, by a company licensed after September 30, 2007, in a smaller enterprise, to the extent that the total of such amounts does not exceed 50 percent of the company's private capital, subject to such terms as the Administrator may impose to assure no cost (as defined in section 502 of the Federal Credit Reform Act of 1990) with respect to purchasing or guaranteeing any debenture involved.'.CommentsClose CommentsPermalink





(b) Maximum Aggregate Amount of Leverage- Paragraph (4) of subsection (b) of section 303 of the Small Business Investment Act of 1958 (15 U.S.C. 303(b)(4)) is amended by adding at the end the following new subparagraph:CommentsClose CommentsPermalink





`(E) INVESTMENTS IN ENERGY SAVING SMALL BUSINESSES- In calculating the aggregate outstanding leverage of a company for purposes of subparagraph (A), the Administrator shall not include the amount of the cost basis of any Energy Saving qualified investment (as defined in subsection (k)) made after September 30, 2007, by a company licensed after September 30, 2007, in a smaller enterprise, to the extent that the total of such amounts does not exceed 50 percent of the company's private capital, subject to such terms as the Administrator may impose to assure no cost (as defined in section 502 of the Federal Credit Reform Act of 1990) with respect to purchasing or guaranteeing any debenture involved.'.CommentsClose CommentsPermalink

SEC. 9. RENEWABLE FUEL CAPITAL INVESTMENT COMPANY.

Title III of the Small Business Investment Act of 1958 (15 U.S.C. 681 et seq.) is amended by adding at the end the following new part:CommentsClose CommentsPermalink

`PART C--RENEWABLE FUEL CAPITAL INVESTMENT PILOT PROGRAM

`SEC. 381. DEFINITIONS.

`In this part, the following definitions apply:CommentsClose CommentsPermalink





`(1) VENTURE CAPITAL- The term `venture capital' means capital in the form of equity capital investments. For the purposes of this paragraph, the term `equity capital' has the same meaning given such term in section 303(g)(4).CommentsClose CommentsPermalink





`(2) RENEWABLE FUEL CAPITAL INVESTMENT COMPANY- The term `Renewable Fuel Capital Investment Company' means a company that--CommentsClose CommentsPermalink





`(A) has been granted final approval by the Administrator under section 384(e); andCommentsClose CommentsPermalink





`(B) has entered into a participation agreement with the Administrator.CommentsClose CommentsPermalink





`(3) OPERATIONAL ASSISTANCE- The term `operational assistance' means management, marketing, and other technical assistance that assists a small business concern with business development.CommentsClose CommentsPermalink





`(4) PARTICIPATION AGREEMENT- The term `participation agreement' means an agreement, between the Administrator and a company granted final approval under section 384(e), that--CommentsClose CommentsPermalink





`(A) details the company's operating plan and investment criteria; andCommentsClose CommentsPermalink





`(B) requires the company to make investments in smaller enterprises primarily engaged in researching, manufacturing, developing, or bringing to market renewable energy sources.CommentsClose CommentsPermalink





`(5) RENEWABLE ENERGY- The term `renewable energy means' energy derived from resources that are regenerative or that cannot be depleted, including but not limited to ethanol and biodiesel fuels.CommentsClose CommentsPermalink





`(6) STATE- The term `State' means such of the several States, the District of Columbia, the Commonwealth of Puerto Rico, the Virgin Islands, Guam, American Samoa, the Commonwealth of the Northern Mariana Islands, and any other commonwealth, territory, or possession of the United States.CommentsClose CommentsPermalink

`SEC. 382. PURPOSES.

`The purposes of the Renewable Fuel Capital Investment Program established under this part are--CommentsClose CommentsPermalink





`(1) to promote the research, development, manufacture and bringing to market of renewable energy sources by encouraging venture capital investments in smaller enterprises primarily engaged such activities; andCommentsClose CommentsPermalink





`(2) to establish a venture capital program, with the mission of addressing the unmet equity investment needs of small enterprises engaged in researching, developing, manufacturing, and bringing to market renewable energy sources, to be administered by the Administrator--CommentsClose CommentsPermalink





`(A) to enter into participation agreements with Renewable Fuel Capital Investment companies;CommentsClose CommentsPermalink





`(B) to guarantee debentures of Renewable Fuel Capital Investment companies to enable each such company to make venture capital investments in smaller enterprises engaged in the research, development, manufacture, and bringing to market renewable energy sources; andCommentsClose CommentsPermalink





`(C) to make grants to Renewable Fuel Investment Capital companies, and to other entities, for the purpose of providing operational assistance to smaller enterprises financed, or expected to be financed, by such companies.CommentsClose CommentsPermalink

`SEC. 383. ESTABLISHMENT.

`In accordance with this part, the Administrator shall establish a Renewable Fuel Capital Investment Program, under which the Administrator may--CommentsClose CommentsPermalink





`(1) enter into participation agreements with companies granted final approval under section 384(e) for the purposes set forth in section 382; andCommentsClose CommentsPermalink





`(2) guarantee the debentures issued by Renewable Fuel Capital Investment companies as provided in section 385.CommentsClose CommentsPermalink

`SEC. 384. SELECTION OF RENEWABLE FUEL CAPITAL INVESTMENT COMPANIES.

`(a) Eligibility- A company shall be eligible to apply to participate, as a Renewable Fuel Capital Investment company, in the program established under this part if--CommentsClose CommentsPermalink





`(1) the company is a newly formed for-profit entity or a newly formed for-profit subsidiary of an existing entity;CommentsClose CommentsPermalink





`(2) the company has a management team with experience in alternative energy financing or relevant venture capital financing; andCommentsClose CommentsPermalink





`(3) the company has a primary objective of investment in companies that research, manufacture, develop, or bring to market renewable energy sources.CommentsClose CommentsPermalink





`(b) Application- To participate, as a Renewable Fuel Capital Investment company, in the program established under this part a company meeting the eligibility requirements set forth in subsection (a) shall submit an application to the Administrator that includes--CommentsClose CommentsPermalink





`(1) a business plan describing how the company intends to make successful venture capital investments in smaller businesses primarily engaged in the research, manufacture, development, or bringing to market of renewable energy sources;CommentsClose CommentsPermalink





`(2) information regarding the relevant venture capital qualifications and general reputation of the company's management;CommentsClose CommentsPermalink





`(3) a description of how the company intends to seek to address the unmet capital needs of the smaller businesses served;CommentsClose CommentsPermalink





`(4) a proposal describing how the company intends to use the grant funds provided under this part to provide operational assistance to smaller enterprises financed by the company, including information regarding whether the company intends to use licensed professionals when necessary on the company's staff or from an outside entity;CommentsClose CommentsPermalink





`(5) with respect to binding commitments to be made to the company under this part, an estimate of the ratio of cash to in-kind contributions;CommentsClose CommentsPermalink





`(6) a description of the criteria to be used to evaluate whether and to what extent the company meets the objectives of the program established under this part;CommentsClose CommentsPermalink





`(7) information regarding the management and financial strength of any parent firm, affiliated firm, or any other firm essential to the success of the company's business plan; andCommentsClose CommentsPermalink





`(8) such other information as the Administrator may require.CommentsClose CommentsPermalink





`(c) Conditional Approval-CommentsClose CommentsPermalink





`(1) IN GENERAL- From among companies submitting applications under subsection (b), the Administrator shall, in accordance with this subsection, conditionally approve companies to participate in the Renewable Fuel Capital Investment Program.CommentsClose CommentsPermalink





`(2) SELECTION CRITERIA- In selecting companies under paragraph (1), the Administrator shall consider the following:CommentsClose CommentsPermalink





`(A) The likelihood that the company will meet the goal of its business plan.CommentsClose CommentsPermalink





`(B) The experience and background of the company's management team.CommentsClose CommentsPermalink





`(C) The need for venture capital investments in the geographic areas in which the company intends to invest.CommentsClose CommentsPermalink





`(D) The extent to which the company will concentrate its activities on serving the geographic areas in which it intends to invest.CommentsClose CommentsPermalink





`(E) The likelihood that the company will be able to satisfy the conditions under subsection (d).CommentsClose CommentsPermalink





`(F) The extent to which the activities proposed by the company will expand economic opportunities in the geographic areas in which the company intends to invest.CommentsClose CommentsPermalink





`(G) The strength of the company's proposal to provide operational assistance under this part as the proposal relates to the ability of the applicant to meet applicable cash requirements and properly utilize in-kind contributions, including the use of resources for the services of licensed professionals, when necessary, whether provided by persons on the company's staff or by persons outside of the company.CommentsClose CommentsPermalink





`(H) Any other factors deemed appropriate by the Administrator.CommentsClose CommentsPermalink





`(3) NATIONWIDE DISTRIBUTION- The Administrator shall select companies under paragraph (1) in such a way that promotes investment nationwide.CommentsClose CommentsPermalink





`(d) Requirements To Be Met for Final Approval- The Administrator shall grant each conditionally approved company a period of time, not to exceed 2 years, to satisfy the following requirements:CommentsClose CommentsPermalink





`(1) CAPITAL REQUIREMENT- Each conditionally approved company shall raise not less than $5,000,000 of private capital or binding capital commitments from one or more investors (other than agencies or departments of the Federal Government) who met criteria established by the Administrator.CommentsClose CommentsPermalink





`(2) NONADMINISTRATION RESOURCES FOR OPERATIONAL ASSISTANCE-CommentsClose CommentsPermalink





`(A) IN GENERAL- In order to provide operational assistance to smaller enterprises expected to be financed by the company, each conditionally approved company--CommentsClose CommentsPermalink





`(i) shall have binding commitments (for contribution in cash or in kind)--CommentsClose CommentsPermalink





`(I) from any sources other than the Small Business Administration that meet criteria established by the Administrator;CommentsClose CommentsPermalink





`(II) payable or available over a multiyear period acceptable to the Administrator (not to exceed 10 years); andCommentsClose CommentsPermalink





`(III) in an amount not less than 30 percent of the total amount of capital and commitments raised under paragraph (1);CommentsClose CommentsPermalink





`(ii) shall have purchased an annuity--CommentsClose CommentsPermalink





`(I) from an insurance company acceptable to the Administrator;CommentsClose CommentsPermalink





`(II) using funds (other than the funds raised under paragraph (1)), from any source other than the Administrator; andCommentsClose CommentsPermalink





`(III) that yields cash payments over a multiyear period acceptable to the Administrator (not to exceed 10 years) in an amount not less than 30 percent of the total amount of capital and commitments raised under paragraph (1); orCommentsClose CommentsPermalink





`(iii) shall have binding commitments (for contributions in cash or in kind) of the type described in clause (i) and shall have purchased an annuity of the type described in clause (ii), which in the aggregate make available, over a multiyear period acceptable to the Administrator (not to exceed 10 years), an amount not less than 30 percent of the total amount of capital and commitments raised under paragraph (1).CommentsClose CommentsPermalink





`(B) EXCEPTION- The Administrator may, in the discretion of the Administrator and based upon a showing of special circumstances and good cause, consider an applicant to have satisfied the requirements of subparagraph (A) if the applicant has--CommentsClose CommentsPermalink





`(i) a viable plan that reasonably projects the capacity of the applicant to raise the amount (in cash or in-kind) required under subparagraph (A); andCommentsClose CommentsPermalink





`(ii) binding commitments in an amount equal to not less than 20 percent of the total amount required under paragraph (A).CommentsClose CommentsPermalink





`(C) LIMITATION- In order to comply with the requirements of subparagraphs (A) and (B), the total amount of a company's in-kind contributions may not exceed 50 percent of the company's total contributions.CommentsClose CommentsPermalink





`(e) Final Approval; Designation- The Administrator shall, with respect to each applicant conditionally approved to operate as a Renewable Fuel Capital Investment Company under subsection (c), either--CommentsClose CommentsPermalink





`(1) grant final approval to the applicant to operate as a Renewable Fuel Capital Investment company under this part and designate the applicant as such a company, if the applicant--CommentsClose CommentsPermalink





`(A) satisfies the requirements of subsection (d) on or before the expiration of the time period described in that subsection; andCommentsClose CommentsPermalink





`(B) enters into a participation agreement with the Administrator; orCommentsClose CommentsPermalink





`(2) if the applicant fails to satisfy the requirements of subsection (d) on or before the expiration of the time period described in that subsection, revoke the conditional approval granted under that subsection.CommentsClose CommentsPermalink

`SEC. 385. DEBENTURES.

`(a) In General- The Administrator may guarantee the timely payment of principal and interest, as scheduled, on debentures issued by any Renewable Fuel Capital Investment company.CommentsClose CommentsPermalink





`(b) Terms and Conditions- The Administrator may make guarantees under this section on such terms and conditions as it deems appropriate, except that the term of any debenture guaranteed under this section shall not exceed 15 years.CommentsClose CommentsPermalink





`(c) Full Faith and Credit of the United States- The full faith and credit of the United States is pledged to pay all amounts that may be required to be paid under any guarantee under this part.CommentsClose CommentsPermalink





`(d) Maximum Guarantee-CommentsClose CommentsPermalink





`(1) IN GENERAL- Under this section, the Administrator may guarantee the debentures issued by a Renewable Fuel Capital Investment company only to the extent that the total face amount of outstanding guaranteed debentures of such company does not exceed 150 percent of the private capital of the company, as determined by the Administrator.CommentsClose CommentsPermalink





`(2) TREATMENT OF CERTAIN FEDERAL FUNDS- For the purposes of paragraph (1), private capital shall include capital that is considered to be Federal funds, if such capital is contributed by an investor other than an agency or department of the Federal Government.CommentsClose CommentsPermalink

`SEC. 386. ISSUANCE AND GUARANTEE OF TRUST CERTIFICATES.

`(a) Issuance- The Administrator may issue trust certificates representing ownership of all or a fractional part of debentures issued by a Renewable Fuel Capital Investment company and guaranteed by the Administrator under this part, if such certificates are based on and backed by a trust or pool approved by the Administrator and composed solely of guaranteed debentures.CommentsClose CommentsPermalink





`(b) Guarantee-CommentsClose CommentsPermalink





`(1) IN GENERAL- The Administrator may, under such terms and conditions as it deems appropriate, guarantee the timely payment of the principal of and interest on trust certificates issued by the Administrator or its agents for purposes of this section.CommentsClose CommentsPermalink





`(2) LIMITATION- Each guarantee under this subsection shall be limited to the extent of principal and interest on the guaranteed debentures that compose the trust or pool.CommentsClose CommentsPermalink





`(3) PREPAYMENT OR DEFAULT- In the event that a debenture in a trust or pool is prepaid, or in the event of default of such a debenture, the guarantee of timely payment of principal and interest on the trust certificates shall be reduced in proportion to the amount of principal and interest such prepaid debenture represents in the trust or pool. Interest on prepaid or defaulted debentures shall accrue and be guaranteed by the Administrator only through the date of payment of the guarantee. At any time during its term, a trust certificate may be called for redemption due to prepayment or default of all debentures.CommentsClose CommentsPermalink





`(c) Full Faith and Credit of the United States- The full faith and credit of the United States is pledged to pay all amounts that may be required to be paid under any guarantee of a trust certificate issued by the Administrator or its agents under this section.CommentsClose CommentsPermalink





`(d) Fees- The Administrator shall not collect a fee for any guarantee of a trust certificate under this section, but any agent of the Administrator may collect a fee approved by the Administrator for the functions described in subsection (f )(2).CommentsClose CommentsPermalink





`(e) Subrogation and Ownership Rights-CommentsClose CommentsPermalink





`(1) SUBROGATION- In the event the Administrator pays a claim under a guarantee issued under this section, it shall be subrogated fully to the rights satisfied by such payment.CommentsClose CommentsPermalink





`(2) OWNERSHIP RIGHTS- No Federal, State, or local law shall preclude or limit the exercise by the Administrator of its ownership rights in the debentures residing in a trust or pool against which trust certificates are issued under this section.CommentsClose CommentsPermalink





`(f) Management and Administration-CommentsClose CommentsPermalink





`(1) REGISTRATION- The Administrator may provide for a central registration of all trust certificates issued under this section.CommentsClose CommentsPermalink





`(2) CONTRACTING OF FUNCTIONS-CommentsClose CommentsPermalink





`(A) IN GENERAL- The Administrator may contract with an agent or agents to carry out on behalf of the Administrator the pooling and the central registration functions provided for in this section including, notwithstanding any other provision of law--CommentsClose CommentsPermalink





`(i) maintenance, on behalf of and under the direction of the Administrator, of such commercial bank accounts or investments in obligations of the United States as may be necessary to facilitate the creation of trusts or pools backed by debentures guaranteed under this part; andCommentsClose CommentsPermalink





`(ii) the issuance of trust certificates to facilitate the creation of such trusts or pools.CommentsClose CommentsPermalink





`(B) FIDELITY BOND OR INSURANCE REQUIREMENT- Any agent performing functions on behalf of the Administrator under this paragraph shall provide a fidelity bond or insurance in such amounts as the Administrator determines to be necessary to fully protect the interests of the United States.CommentsClose CommentsPermalink





`(3) REGULATION OF BROKERS AND DEALERS- The Administrator may regulate brokers and dealers in trust certificates issued under this section.CommentsClose CommentsPermalink





`(4) ELECTRONIC REGISTRATION- Nothing in this subsection may be construed to prohibit the use of a book-entry or other electronic form of registration for trust certificates issued under this section.CommentsClose CommentsPermalink

`SEC. 387. FEES.

`(a) In General- Except as provided in section 386(d), the Administrator may charge such fees as it deems appropriate with respect to any guarantee or grant issued under this part, in an amount established annually by the Administration, as necessary to reduce to zero the cost (as defined in section 502 of the Federal Credit Reform Act of 1990) to the Administration of purchasing and guaranteeing debentures under this Act, which amounts shall be paid to and retained by the Administration.CommentsClose CommentsPermalink





`(b) Offset- The Administrator may, as provided by section 388, offset fees changed and collected under subsection (a).CommentsClose CommentsPermalink

`SEC. 388. FEE CONTRIBUTION.

`(a) In General- To the extent that amounts are made available to the Administrator for the purpose of fee contributions, the administrator shall contribute to fees paid by the Renewable Fuel Capital Investment companies under section 387.CommentsClose CommentsPermalink





`(b) Annual Adjustment- Each fee contribution under subsection (a) shall be effective for one fiscal year and shall be adjusted as necessary for each fiscal year thereafter to ensure that amounts under subsection (a) are fully used. The fee contribution for a fiscal year shall be based on the outstanding commitments made and the guarantees and grants that the Administrator projects will be made during that fiscal year, given the program level authorized by law for that fiscal year and any other factors that the Administrator deems appropriate.CommentsClose CommentsPermalink

`SEC. 389. OPERATIONAL ASSISTANCE GRANTS.

`(a) In General-CommentsClose CommentsPermalink





`(1) AUTHORITY- In accordance with this section, the Administrator may make grants to Renewable Fuel Capital Investment companies and to other entities, as authorized by this part, to provide operational assistance to smaller enterprises financed, or expected to be financed, by such companies or other entities.CommentsClose CommentsPermalink





`(2) TERMS- Grants made under this subsection shall be made over a multiyear period not to exceed 10 years, under such other terms as the Administrator may require.CommentsClose CommentsPermalink





`(3) GRANTS TO SPECIALIZED SMALL BUSINESS INVESTMENT COMPANIES-CommentsClose CommentsPermalink





`(A) AUTHORITY- In accordance with this section, the Administrator may make grants to specialized small business investment companies to provide operational assistance to smaller enterprises financed, or expected to be financed, by such companies after the effective date of the Small Energy Efficient Businesses Act.CommentsClose CommentsPermalink





`(B) USE OF FUNDS- The proceeds of a grant made under this paragraph may be used by the company receiving such grant only to provide operational assistance in connection with an equity investment (made with capital raised after the effective date of the Small Energy Efficient Businesses Act) in a business located in a low-income geographic area.CommentsClose CommentsPermalink





`(C) SUBMISSION OF PLANS- A specialized small business investment company shall be eligible for a grant under this section only if the company submits to the Administrator, in such form and manner as the Administrator may require, a plan for use of the grant.CommentsClose CommentsPermalink





`(4) GRANT AMOUNT-CommentsClose CommentsPermalink





`(A) RENEWABLE FUEL CAPITAL INVESTMENT COMPANIES- The amount of a grant made under this subsection to a Renewable Fuel Capital Investment company shall be equal to the resources (in cash or in kind) raised by the company under section 354(d)(2).CommentsClose CommentsPermalink





`(B) OTHER ENTITIES- The amount of a grant made under this subsection to any entity other than a Renewable Fuel Capital Investment company shall be equal to the resources (in cash or in kind) raised by the entity in accordance with the requirements applicable to Renewable Fuel Capital Investment companies set forth in section 384(d)(2).CommentsClose CommentsPermalink





`(5) PRO RATA REDUCTIONS- If the amount made available to carry out this section is insufficient for the Administrator to provide grants in the amounts provided for in paragraph (4), the Administrator shall make pro rata reductions in the amounts otherwise payable to each company and entity under such paragraph.CommentsClose CommentsPermalink





`(b) Supplemental Grants-CommentsClose CommentsPermalink





`(1) IN GENERAL- The Administrator may make supplemental grants to Renewable Fuel Capital Investment companies and to other entities, as authorized by this part under such terms as the Administrator may require, to provide additional operational assistance to smaller enterprises financed, or expected to be financed, by the companies.CommentsClose CommentsPermalink





`(2) MATCHING REQUIREMENT- The Administrator may require, as a condition of any supplemental grant made under this subsection, that the company or entity receiving the grant provide from resources (in a cash or in kind), other then those provided by the Administrator, a matching contribution equal to the amount of the supplemental grant.CommentsClose CommentsPermalink





`(c) Limitation- None of the assistance made available under this section may be used for any overhead or general and administrative expense of a Renewable Fuel Capital Investment company or a specialized small business investment company.CommentsClose CommentsPermalink

`SEC. 390. BANK PARTICIPATION.

`(a) In General- Except as provided in subsection (b), any national bank, any member bank of the Federal Reserve System, and (to the extent permitted under applicable State law) any insured bank that is not a member of such system, may invest in any Renewable Fuel Capital Investment company, or in any entity established to invest solely in Renewable Fuel Capital Investment companies.CommentsClose CommentsPermalink





`(b) Limitation- No bank described in subsection (a) may make investments described in such subsection that are greater than 5 percent of the capital and surplus of the bank.CommentsClose CommentsPermalink

`SEC. 391. FEDERAL FINANCING BANK.

`Section 318 shall not apply to any debenture issued by a Renewable Fuel Capital Investment company under this part.CommentsClose CommentsPermalink

`SEC. 392. REPORTING REQUIREMENT.

`Each Renewable Fuel Capital Investment company that participates in the program established under this part shall provide to the Administrator such information as the Administrator may require, including--CommentsClose CommentsPermalink





`(1) information related to the measurement criteria that the company proposed in its program application; andCommentsClose CommentsPermalink





`(2) in each case in which the company under this part makes an investment in, or a loan or a grant to, a business that is not primarily engaged in the research, development, manufacture, or bringing to market or renewable energy sources, a report on the nature, origin, and revenues of the business in which investments are made.CommentsClose CommentsPermalink

`SEC. 393. EXAMINATIONS.

`(a) In General- Each Renewable Fuel Capital Investment company that participates in the program established under this part shall be subject to examinations made at the direction of the Investment Division of the Small Business Administration in accordance with this section.CommentsClose CommentsPermalink





`(b) Assistance of Private Sector Entities- Examinations under this section may be conducted with the assistance of a private sector entity that has both the qualifications and the expertise necessary to conduct such examinations.CommentsClose CommentsPermalink





`(c) Costs-CommentsClose CommentsPermalink





`(1) ASSESSMENT-CommentsClose CommentsPermalink





`(A) IN GENERAL- The Administrator may assess the cost of examinations under this section, including compensation of the examiners, against the company examined.CommentsClose CommentsPermalink





`(B) PAYMENT- Any company against which the Administrator assesses costs under this paragraph shall pay such costs.CommentsClose CommentsPermalink





`(2) DEPOSIT OF FUNDS- Funds collected under this section shall be deposited in the account for salaries and expenses of the Small Business Administration.CommentsClose CommentsPermalink

`SEC. 394. MISCELLANEOUS.

`To the extent such procedures are not inconsistent with the requirements of this part, the Administrator may take such action as set forth in sections 309, 311, 312, and 314 of this Act.CommentsClose CommentsPermalink

`SEC. 395. REMOVAL OR SUSPENSION OF DIRECTORS OR OFFICERS.

`Using the procedures for removing or suspending a director or an officer of a licensee set forth in section 313 (to the extent such procedures are not inconsistent with the requirements of this part), the Administrator may remove or suspend any director or officer of any Renewable Fuel Capital Investment company.CommentsClose CommentsPermalink

`SEC. 396. REGULATIONS.

`The Administrator may issue such regulations as it deems necessary to carry out the provisions of this part in accordance with its purposes.CommentsClose CommentsPermalink

`SEC. 397. AUTHORIZATIONS OF APPROPRIATIONS.

`(a) Grants- The Administrator is authorized to make $15,000,000 per fiscal year in operational assistance grants.CommentsClose CommentsPermalink





`(b) Funds Collected for Examinations- Funds deposited under section 393(c)(2) are authorized to be appropriated only for the costs of examinations under section 393 and for the costs of other oversight activities with respect to the program established under this part.'.CommentsClose CommentsPermalink

SEC. 10. STUDY AND REPORT.

The Administrator shall conduct a study of the Renewable Fuel Capital Investment Program under part C of title III of the Small Business Investment Act of 1958. Not later than 3 years after the date of the enactment of this Act, the Administrator shall complete the study and submit to the Congress a report of the results of the study.CommentsClose CommentsPermalink