Federal

Small Business Child Care Investment Act

Source: Congress.gov · 1,139 words in original text

What This Bill Does

This bill allows nonprofit child care providers to get loans from the Small Business Administration. The bill makes these nonprofit providers eligible for the same loan programs that regular small businesses use. It also requires the Small Business Administration to report annually to Congress about how many loans go to these nonprofit child care providers.

Who It Affects

Nonprofit child care providers that meet specific requirements. The Small Business Administration. Congress. Children from birth through school age who attend these care facilities.

Key Provisions

• Nonprofit child care providers must be tax-exempt organizations, comply with state licensing requirements, primarily serve children from birth to school age, and have employees and volunteers who pass criminal background checks to qualify for loans (Sec. 2(a)(10)(A)). • Qualifying nonprofit child care providers are treated as small business concerns and can get loans under section 7(a) of the Small Business Act or financing under title V of the Small Business Investment Act of 1958 (Sec. 2(a)(10)(B)(i)). • Nonprofit child care providers can borrow up to $500,000 without obtaining a payment guarantee from another person or entity, but must get a guarantee for loans larger than $500,000 (Sec. 2(a)(10)(B)(ii)). • The Small Business Administration cannot deny loans or financing to these providers simply because the money will be used for religious activities protected by the First Amendment (Sec. 2(a)(10)(C)). • The Small Business Administration must report annually to Congress about the number and amount of loans made to these nonprofit child care providers (Sec. 2(b)(2)).

What Changes

Nonprofit child care providers become eligible to borrow money through Small Business Administration loan programs. These organizations can now access the same financing options previously available only to regular small businesses. The Small Business Administration must track and report data on these loans each year.

Important Definitions

A "covered nonprofit child care provider" is defined as a nonprofit organization that meets all of these requirements: complies with state child care licensing rules, has tax-exempt status, primarily cares for children from birth until they reach school age, complies with size standards for its industry, requires all employees and volunteers to pass criminal background checks, and certifies it will not discriminate based on race, color, religion, sex, sexual orientation, marital status, age, disability or national origin (Sec. 2(a)(10)(A)).

II Calendar No. 163 118TH CONGRESS 1ST SESSION S. 673 To allow nonprofit child care providers to participate in certain loan programs of the Small Business Administration, and for other purposes. IN THE SENATE OF THE UNITED STATES MARCH 7, 2023 Ms. ROSEN (for herself, Ms. ERNST, Ms. DUCKWORTH, Mr. RUBIO, and Mr. RISCH) introduced the following bill; which was read twice and referred to the Committee on Small Business and Entrepreneurship JULY 25, 2023 Reported by Mr. CARDIN, without amendment A BILL To allow nonprofit child care providers to participate in certain loan programs of the Small Business Administra- tion, and for other purposes. Be it enacted by the Senate and House of Representa- 1 tives of the United States of America in Congress assembled, 2 SECTION 1. SHORT TITLE. 3 This Act may be cited as the ‘‘Small Business Child 4 Care Investment Act’’. 5 VerDate Sep 11 2014 04:40 Jul 26, 2023 Jkt 039200 PO 00000 Frm 00001 Fmt 6652 Sfmt 6201 E:\BILLS\S673.RS S673 kjohnson on DSK79L0C42PROD with BILLS 2 •S 673 RS SEC. 2. SMALL BUSINESS LOANS FOR NONPROFIT CHILD 1 CARE PROVIDERS. 2 (a) IN GENERAL.—Section 3(a) of the Small Busi- 3 ness Act (15 U.S.C. 632(a)) is amended by adding at the 4 end the following: 5 ‘‘(10) NONPROFIT CHILD CARE PROVIDERS.— 6 ‘‘(A) DEFINITION.—In this paragraph, the 7 term ‘covered nonprofit child care provider’ 8 means an organization— 9 ‘‘(i) that— 10 ‘‘(I) is in compliance with licens- 11 ing requirements for child care pro- 12 viders of the State in which the orga- 13 nization is located; 14 ‘‘(II) is described in section 15 501(c)(3) of the Internal Revenue 16 Code of 1986 and exempt from tax 17 under section 501(a) of such Code; 18 ‘‘(III) is primarily engaged in 19 providing child care for children from 20 birth to compulsory school age; and 21 ‘‘(IV) is in compliance with the 22 size standards established under this 23 subsection for business concerns in 24 the applicable industry; 25 VerDate Sep 11 2014 04:40 Jul 26, 2023 Jkt 039200 PO 00000 Frm 00002 Fmt 6652 Sfmt 6201 E:\BILLS\S673.RS S673 kjohnson on DSK79L0C42PROD with BILLS 3 •S 673 RS ‘‘(ii) for which each employee and reg- 1 ular volunteer complies with the criminal 2 background check requirements under sec- 3 tion 658H(b) of the Child Care and Devel- 4 opment Block Grant Act of 1990 (42 5 U.S.C. 9858f(b)); 6 ‘‘(iii) that may— 7 ‘‘(I) provide care for school-age 8 children outside of school hours or 9 outside of the school year; or 10 ‘‘(II) offer preschool or pre- 11 kindergarten educational programs; 12 and 13 ‘‘(iv) subject to any exemption under 14 Federal law applicable to the organization, 15 that certifies to the Administrator that the 16 organization will not discriminate in any 17 business practice, including providing serv- 18 ices to the public, on the basis of race, 19 color, religion, sex, sexual orientation, mar- 20 ital status, age, disability, or national ori- 21 gin. 22 ‘‘(B) ELIGIBILITY FOR CERTAIN LOAN 23 PROGRAMS.— 24 VerDate Sep 11 2014 04:40 Jul 26, 2023 Jkt 039200 PO 00000 Frm 00003 Fmt 6652 Sfmt 6201 E:\BILLS\S673.RS S673 kjohnson on DSK79L0C42PROD with BILLS 4 •S 673 RS ‘‘(i) IN GENERAL.—Notwithstanding 1 any other provision of this subsection, a 2 covered nonprofit child care provider shall 3 be deemed to be a small business concern 4 for purposes of loans under section 7(a) of 5 this Act or financing under title V of the 6 Small Business Investment Act of 1958 7 (15 U.S.C. 695 et seq.). 8 ‘‘(ii) LOAN GUARANTEE.—A covered 9 nonprofit child care center provider— 10 ‘‘(I) shall obtain a guarantee of 11 timely payment of the loan or financ- 12 ing from another person or entity to 13 be eligible for a loan or financing of 14 more than $500,000 under the au- 15 thority under clause (i); and 16 ‘‘(II) shall not be required to ob- 17 tain a guarantee of timely payment of 18 the loan or financing to be eligible for 19 a loan or financing that is not more 20 than $500,000 under the authority 21 under clause (i). 22 ‘‘(C) LIMITATION ON BASIS FOR INELIGI- 23 BILITY.—The Administrator may not determine 24 that a covered nonprofit child care center pro- 25 VerDate Sep 11 2014 04:40 Jul 26, 2023 Jkt 039200 PO 00000 Frm 00004 Fmt 6652 Sfmt 6201 E:\BILLS\S673.RS S673 kjohnson on DSK79L0C42PROD with BILLS 5 •S 673 RS vider is not eligible for a loan or financing de- 1 scribed in subparagraph (B)(i) on the basis that 2 the proceeds of the loan or financing will be 3 used for a religious activity protected under the 4 First Amendment to the Constitution of the 5 United States, as interpreted by the courts of 6 the United States.’’. 7 (b) REPORTING.— 8 (1) DEFINITION.—In this subsection, the term 9 ‘‘covered nonprofit child care provider’’ has the 10 meaning given the term in paragraph (10) of section 11 3(a) of the Small Business Act (15 U.S.C. 632(a)), 12 as added by subsection (a). 13 (2) REQUIREMENT.—Not later than 1 year 14 after the date of enactment of this Act, and annually 15 thereafter, the Administrator of the Small Business 16 Administration shall submit to Congress a report 17 that contains— 18 (A) for the year covered by the report— 19 (i) the number of loans made under 20 section 7(a) of the Small Business Act (15 21 U.S.C. 636(a)) and the number of 22 financings provided under title V of the 23 Small Business Investment Act of 1958 24 VerDate Sep 11 2014 04:40 Jul 26, 2023 Jkt 039200 PO 00000 Frm 00005 Fmt 6652 Sfmt 6201 E:\BILLS\S673.RS S673 kjohnson on DSK79L0C42PROD with BILLS 6 •S 673 RS (15 U.S.C. 695 et seq.) to covered non- 1 profit child care providers; and 2 (ii) the amount of such loans made 3 and the amount of such financings pro- 4 vided to covered nonprofit child care pro- 5 viders; and 6 (B) any other information determined rel- 7 evant by the Administrator. 8 VerDate Sep 11 2014 04:40 Jul 26, 2023 Jkt 039200 PO 00000 Frm 00006 Fmt 6652 Sfmt 6201 E:\BILLS\S673.RS S673 kjohnson on DSK79L0C42PROD with BILLS VerDate Sep 11 2014 04:40 Jul 26, 2023 Jkt 039200 PO 00000 Frm 00007 Fmt 6652 Sfmt 6201 E:\BILLS\S673.RS S673 kjohnson on DSK79L0C42PROD with BILLS Calendar No. 163 118TH CONGRESS 1ST SESSION S. 673 A BILL To allow nonprofit child care providers to partici- pate in certain loan programs of the Small Busi- ness Administration, and for other purposes. JULY 25, 2023 Reported without amendment VerDate Sep 11 2014 04:40 Jul 26, 2023 Jkt 039200 PO 00000 Frm 00008 Fmt 6651 Sfmt 6651 E:\BILLS\S673.RS S673 kjohnson on DSK79L0C42PROD with BILLS

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