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504 Credit Risk Management Improvement Act of 2023
12/15/2023, 4:07 PM
Summary of Bill S 1345
Additionally, the bill includes provisions to increase transparency and accountability within the program by requiring lenders to report on their risk management practices and outcomes to the Small Business Administration. This will help ensure that taxpayer dollars are being used efficiently and effectively to support small businesses.
Overall, the 504 Credit Risk Management Improvement Act of 2023 is designed to strengthen the 504 loan program and better support small businesses in accessing the capital they need to grow and succeed. It emphasizes the importance of sound risk management practices in ensuring the long-term success of small business borrowers and the overall health of the program.
Congressional Summary of S 1345
504 Credit Risk Management Improvement Act of 2023
This bill revises the duties of the Office of Credit Risk Management to include oversight of a certified development company (CDC) that participates in the 504 Loan Program of the Small Business Administration (SBA), and it requires the SBA to issue rules related to certain environmental requirements. The 504 Loan Program provides a small business with SBA financing—through a CDC intermediary—for expansion or modernization.
Specifically, the bill requires the office to oversee any CDC that participates in the program and to conduct file reviews with respect to loan closings under the program. Further, the bill authorizes the office to take formal and informal enforcement actions against a CDC for specified violations and to charge each CDC a fee.
The SBA must issue rules to clarify the procedures necessary for an eligible CDC to comply with certain environmental requirements.
The bill also extends, with respect to certain loans, the temporary authorities of a local development company that is designated as an accredited lender.
