Disaster Loan Accountability and Reform

Full Title:
DLARA

Summary#

The Disaster Loan Accountability and Reform Act (DLARA) makes several changes to how the Small Business Administration (SBA) runs its disaster loan program. It requires more detailed and regular reporting about disaster loans, including a monthly report with changes to estimates and a travel restriction if the SBA Administrator misses a required report. The bill requires the President's budget to include separate statements showing requested appropriations and 10-year averages for SBA disaster loan costs and COVID-EIDL loan costs, and similar statements for related administrative costs. It limits the Administrator’s authority to forgive or compromise loans unless Congress authorizes forgiveness and requires referral to the Treasury if discharge is restricted. When unobligated disaster loan funds fall below 10% of the most recent appropriation, the SBA must notify congressional appropriations and small business committees and may limit new loan obligations to amounts that require collateral. The bill bars the SBA from issuing any rule that would increase the cost of the disaster loan program. It requires a GAO report on two recent final rules and an SBA Inspector General review of a specified funding shortfall. Finally, the bill directs the SBA to submit and update plans to improve budgeting, forecasting, and data quality for direct disaster loans.

What it means for you#

  • If you apply for an SBA disaster loan: the bill could change loan terms and when collateral is required if program funds get low, because it limits new loans above unsecured amounts after a low-fund notice.
  • If you owe an SBA disaster loan: the Administrator may not forgive your loan unless Congress authorizes forgiveness; certain debt relief actions must be referred to the Department of the Treasury.
  • For small businesses and communities reliant on disaster loans: the bill calls for more frequent public reporting and oversight (GAO and Inspector General reviews) intended to make program funding and forecasts more transparent.
  • For the SBA: the bill requires updated budget statements, improved forecasting and data corrections, and prevents issuing rules that increase program costs.

Expenses#

The bill requires additional reporting and budget statements about disaster loan costs and administrative costs, but it does not provide specific funding amounts or authorize new appropriations in the text. No publicly available information on estimated costs or changes in appropriations is included in the bill text.

Proponents' View#

No publicly available information.

Opponents' View#

No publicly available information.