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119-hr-1021119th CongressWALLET

Small Business Disaster Damage Fairness Act of 2025

Sponsored By: Representative Neguse, Joe [D-CO-2]

Introduced

Summary

Would raise the minimum collateral for Small Business Administration disaster loans to $50,000 and expand the collateral rule from "major disasters" to all disasters.

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  • Small businesses seeking SBA disaster loans would face a higher collateral threshold, increasing the minimum from $14,000 to $50,000. This change could require smaller borrowers to pledge more assets or find other financing.
  • Rural communities would get targeted outreach. The SBA must tailor its disaster loan marketing and include actions to address challenges rural areas face accessing loans, following GAO findings.
  • The Comptroller General would have to deliver a report within 3 years on the performance and default rates of loans made under section 7(b)(1), covering loans from Sept 30, 2020 through two years after enactment.

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Bill Overview

Analyzed Economic Effects

2 provisions identified: 1 benefits, 1 costs, 0 mixed.

Higher collateral for SBA disaster loans

If enacted, SBA disaster loans would face a higher collateral floor. The minimum collateral threshold would rise to $50,000, up from $14,000. The rule would also apply to any declared disaster, not only a major disaster. This would start upon enactment and could make it harder for some small businesses and homeowners to qualify.

Targeted SBA outreach for rural communities

If enacted, SBA would update its disaster loan outreach plan. It would separate rural and urban needs and add steps to reduce rural access problems. The approach would follow a 2024 GAO report. This would begin upon enactment and could help rural small businesses find and use SBA loans.

Sponsors & CoSponsors

Sponsor

Neguse, Joe [D-CO-2]

CO • D

Cosponsors

  • Rep. Obernolte, Jay [R-CA-23]

    CA • R

    Sponsored 2/5/2025

Roll Call Votes

No roll call votes available for this bill.

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