Not sure what is the relation between the two, but this one has the reference to Halliburton.
KERRY. Mr. President, I offer this amendment, together with Senator Landrieu, to provide comprehensive relief to small businesses harmed by Hurricane Katrina. There are two reasons why it is important to do this at this time on this bill.
No. 1, the $63 billion of combined assistance in the two supplemental spending bills doesn't allocate one portion of it to small businesses specifically. So there is no small business relief--no funding for small business assistance within the structure of the SBA or for other small business assistance programs Congress has created.
No. 2, this appropriations bill is the funding source for the Small Business Administration. It is through the Small Business Administration that disaster loan assistance is available for homeowners and for business owners, and it is through the Small Business Administration that the Federal Government provides the full complement of assistance to the small businesses of our Nation. So it is appropriate for us to be doing this at this time. The SBA is indispensable to the recovery of the gulf region after Hurricane Katrina.
I was down there on Monday and could see for myself the numbers of small business people who are impacted, listening to the Governor, the Lieutenant Governor, Congressman Jefferson and others, all of whom described how critical this help is going to be. The States concerned--Alabama, Mississippi, and Louisiana--are still in the process of assessing the full extent of the damage. There are an estimated 800,000 small businesses in those three States, but already we have received reports that more than 100,000 in Louisiana and some 50,000 in Mississippi were damaged or destroyed completely.
We also know that in Louisiana alone, small businesses provide more than 65 percent of the jobs. Sixty-five percent is typical for most of America, which is why Senator after Senator comes to the floor and goes home to their States and talks about the importance of small business to the American economy.
What the mayor of Baton Rouge told me, what the Governors told me, and other officials I spoke with, is how critical it is to be able to get the local population back to work as fast as possible and to try to mitigate against some of the dislocation.
The only way we are going to get people back to work, the only way we get these areas thriving again, is to make small business a priority of the recovery itself.
Our amendment recognizes that it is going to take months, if not years, for a lot of businesses to get back to normal. SBA's Federal disaster loans and physical damage loans and economic injury loans are going to play a critical role in this recovery.
Our amendment also recognizes that similar to the domino effect of the 9/11 attacks--the domino effect that those attacks had on our economy in other places--we need to help not only those businesses physically located within the declared disaster area, but also an awful lot of businesses that have been indirectly harmed because of the loss of business directly to those areas or because of the increase in fuel prices.
The tourism industry, for instance, is so important to New Orleans and has suppliers around the country. Travel agents who book conferences, companies that provide food and beverages and supplies for the hotels, restaurants, and bars. Suddenly they have no orders. There are small businesses that could help rebuild the damaged and destroyed homes, businesses, and infrastructure of the gulf region. But they need legal protection to make sure they can be part of the Federal contracts paying for these projects and services.
One of the reasons for this is that too often the Federal Government, in its effort to move rapidly, which we understand, takes the easiest route or path of least resistance and gives big contracts to the Halliburtons of the world, leaving a lot of the local economy and small businesses still gasping, looking for their way into that pipeline.
Then, of course, there is the underestimated but, frankly, always essential counselor component. A lot of small businesses need help figuring out how to restructure, how to process all of this, how to make up for the loss of business. Many of them have viable businesses. With a small amount of assistance they can keep that viability and minimize the negative impact to our economy and to their business.
In order to put this package together in a way that addressed the real needs of the communities, I have worked closely with Senator Landrieu who, along with her staff, has worked tirelessly in recent days to determine what the businesses in her State need to get Louisiana small business on the road to recovery. I think we ought to be encouraged--frankly, all of us in the Senate ought to be encouraged--at how much we can do under the auspices of the Small Business Administration, recognizing that a lot of these businesses have no way of fully operating now or any time soon. We try to take steps to defer for 2 years the interest and the principal payment for those businesses located directly in the disaster area, those that have been adversely impacted. For small businesses directly impacted, we permit them to use disaster loans, which have interest rates capped at 4 percent. I remind my colleagues that these are loans. These aren't grants. We allow small businesses to refinance existing disaster loans and existing business debt in order to consolidate their debt and lower their interest payments.
For those small businesses directly impacted that had SBA 7(a) and 504 loans before Katrina, if they are unable to make their payments, we direct the SBA to assume the payments for up to 2 years or until the businesses can resume payments earlier on their own.
For small businesses that are directly impacted, such as suppliers to the extensive tourism industry in the gulf coast, we make available SBA 7(a) loans at reduced rates, with protections to make sure that those who need the loans are the ones getting them.
For small businesses that need counseling, we increase funding to SBA's counseling partners to serve businesses, whether they are in Louisiana, Mississippi, or Alabama, or whether they are still displaced in other States such as Texas or Arizona.
We put in place contracting protections to encourage the Federal Government to help rebuild the economy by using local businesses or small businesses.
We authorize $400 million in grants to the States in the declared disaster areas in order to make immediate bridge loans or grants to those small businesses directly harmed by Hurricane Katrina that need access to money immediately and can't wait for the disbursement of Federal loans or other assistance. This has worked in the past, and it can work now.
As we all know, Hurricane Katrina knocked out roughly 10 percent of U.S. oil refining and natural gas pipeline capacity. That has caused prices for gasoline and natural gas to go through the roof all over the country. Experts estimate the impact is going to hit us in the winter as well when heating oil prices are going to increase as much as 70 percent. To help small businesses and farmers and manufacturers that are being crippled by these energy prices, we give them access to low-cost disaster loans.
This is a very straightforward example of how businesses outside the disaster area have been indirectly and seriously adversely impacted.
The other day, I was driving through a couple of States well north of Washington, DC--not in Massachusetts but New Jersey, New York, and elsewhere--and the gas prices are all reflecting the effects of Katrina. Small farmers in the Presiding Officer's State of South Dakota, North Dakota, Wisconsin, Iowa, and all across the country are deeply impacted by the cost of fuel for their tractors or for their trucks for deliveries all across the country. This will help the small businesses and farmers and manufacturers that are being crippled.
The high cost of energy is making American manufacturing noncompetitive. Talk to truckers who are traversing the Nation about the cost of fuel. It's a huge portion of the current price of goods consumed by the increased energy prices. The result is a lot of folks who are teetering on the edge with loans out and financed are now finding themselves in economic difficulty. So this is a way to help them, and this tries to do that.
I point out to my colleagues that previously the energy relief portion of this amendment has passed the Senate three times. There are 37 Republican Senators currently in the Senate who have previously voted for this on several occasions. Our hope is that we can proceed forward.
In addition, to help drive down the impact of Hurricane Katrina and its toll on the economy as a whole--including added costs to health care for small business, energy for small business, and rising interest rates--we temporarily lower the interest rate set by the Federal Government itself. There is no need for us to recoup at the same rate, if it helps those businesses remain viable.
The Congressional Hispanic Caucus has been calling for this relief for Hispanic small business owners because ever since the administration raised the fees on 7(a) loans, loans to Hispanics have fallen by 14 percent. With the added problems to the economy caused by Hurricane Katrina, making capital more affordable is a way to open the doors of opportunity and to help people to be able to keep the economy moving.
In closing, I thank Senator Reid, Senator Mikulski, and Senator Landrieu for their leadership and help in shaping this legislation. The coming weeks and months are critical for small businesses. Frankly, it is too easy to go to the meetings back home and stand up in front of the small business community and say: Aren't you great; you are 98 percent of the businesses of America. You are the engine of our economy.
Over 60 percent of America's employees work in small business. Almost all the new jobs in America come from small business. Small business has been hurt by the hurricane and by the indirect impact of that hurricane on other sectors of our economy. This is an opportunity for the Senate to be able to address those dire needs. I hope my colleagues will join in that effort.
I suggest the absence of a quorum.
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