On Thursday evening, the US Senate Small Business & Entrepreneurship Committee advanced The Disaster Loan Accountability and Reform Act with bipartisan support to the Senate floor for consideration. US Sens. Thom Tillis and Tedd Budd, representing North Carolina, introduced the legislation in October.
Bill sponsors say the legislation bolsters oversight, strengthens financial protections, and increases transparency in the Small Business Administration’s disaster loan account. A unanimous consent vote in the Senate was blocked back in November by US Sen. Rand Paul, R-KY.
“As we learn the lessons from Hurricane Helene and the federal response, it’s imperative that we improve disaster response in a fiscally responsible way,” said Budd in a press release. “My bill adds much-needed accountability, transparency, and oversight to SBA’s disaster loan account. I thank my colleagues for joining this effort to help those in need while protecting the integrity of taxpayer dollars.”
The legislation would mandate detailed monthly reports on funding status, assumptions, and depletion estimates, enforcing penalties for non-compliance. Budget requests must adhere to a 10-year program average for disaster loan subsidy and administrative costs. Additionally, unsecured loan thresholds are restricted when funding drops below 10% of the program’s 10-year average cost. It also requires comprehensive reviews of recent funding shortfalls and program inefficiencies, ensuring actionable recommendations for improvement.
“Small businesses across Western North Carolina were hit hard by Hurricane Helene, and it’s our responsibility to ensure they have the resources to recover and rebuild,” said Tillis. “This legislation will enhance oversight, tighten financial controls, and eliminate wasteful spending by instituting clear reporting and budgeting standards. It’s essential that we not only support our small businesses during times of crisis, but also uphold the highest levels of accountability to ensure those resources are available when urgently needed.”
Other bill sponsors include Sen. Tim Scott, R-SC, and Sen. Joni Ernst, R-IA, chairwoman of the Senate Small Business Committee & Entrepreneurship Committee.
“SBA’s mismanagement resulted in the disaster loan program running out of money for 66 days last year,” said Ernst. “This unacceptable failure left disaster victims across the country out in the cold. By advancing this legislation, the Senate Committee on Small Business and Entrepreneurship is ensuring that more Americans in need can get critical relief as soon as possible after disaster strikes.”