PREMIER CERTIFIED LENDERS PROGRAM.

SEC. 223. PREMIER CERTIFIED LENDERS PROGRAM. (a) In General.— Section 508 of the Small Business Investment Act of 1958 (15 U.S.C. 697e) is amended— (1) in subsection (a), by striking “not more than 15”; (2) in subsection (b)— (A) in paragraph (2)— (i) in the matter preceding subparagraph (A), by striking “if such company”; (ii) by striking subparagraphs (A) and (B) and inserting the following: “(A) if the company is an active certified development company in good standing and has been an active participant in the accredited lenders program during the entire 12-month period preceding the date on which the company submits an application under paragraph (1), except that the Administration may waive this requirement if the company is qualified to participate in the accredited lenders program; “(B) if the company has a history of— “(i) submitting to the Administration adequately analyzed debenture guarantee application packages; and “(ii) of properly closing section 504 loans and servicing its loan portfolio;”; (iii) in subparagraph (C)— (I) by inserting “if the company” after “(C)”; and (II) by striking the period at the end and inserting “; and”; and 111 STAT. 2605 (iv) by adding at the end the following: “(D) the Administrator determines, with respect to the company, that the loss reserve established in accordance with subsection (c)(2) is sufficient for the company to meet its obligations to protect the Federal Government from risk of loss.”; and (B) by adding at the end the following: “(3) Applicability of criteria after designation.— The Administrator may revoke the designation of a certified development company as a premier certified lender under this section at any time, if the Administrator determines that the certified development company does not meet any requirement described in subparagraphs (A) through (D) of paragraph (2).”; (3) by striking subsection (c) and inserting the following: “(c) Loss Reserve.— “(1) Establishment.— A company designated as a premier certified lender shall establish a loss reserve for financing approved pursuant to this section. “(2) Amount.— The amount of each loss reserve established under paragraph (1) shall be 10 percent of the amount of the company’s exposure, as determined under subsection (b)(2)(C). “(3) Assets.— Each loss reserve established under paragraph (1) shall be comprised of— “(A) segregated funds on deposit in an account or accounts with a federally insured depository institution or institutions selected by the company, subject to a collateral assignment in favor of, and in a format acceptable to, the Administration; “(B) irrevocable letter or letters of credit, with a collateral assignment in favor of, and a commercially reasonable format acceptable to, the Administration; or “(C) any combination of the assets described in subparagraphs (A) and (B). “(4) Contributions.— The company shall make contributions to the loss reserve, either cash or letters of credit as provided above, in the following amounts and at the following intervals: “(A) 50 percent when a debenture is closed. “(B) 25 percent additional not later than 1 year after a debenture is closed. “(C) 25 percent additional not later than 2 years after a debenture is closed. “(5) Replenishment.— If a loss has been sustained by the Administration, any portion of the loss reserve, and other funds provided by the premier company as necessary, may be used to reimburse the Administration for the premier company’s 10 percent share of the loss as provided in subsection (b)(2)(C). If the company utilizes the reserve, within 30 days it shall replace an equivalent amount of funds. “(6) Disbursements.— The Administration shall allow the certified development company to withdraw from the loss reserve amounts attributable to any debenture that has been repaid.”; (4) in subsection (d)(1), by striking “to approve loans” and inserting “to approve, authorize, close, service, foreclose, litigate (except that the Administration may monitor the conduct of 111 STAT. 2606any such litigation to which a premier certified lender is a party), and liquidate loans”; (5) in subsection (f), by striking “State or local” and inserting “certified”; (6) in subsection (g), by striking the subsection heading and inserting the following: “(g) Effect of Suspension or Revocation.— ”; (7) by striking subsection (h) and inserting the following: “(h) Program Goals.— Each certified development company participating in the program under this section shall establish a goal of processing a minimum of not less than 50 percent of the loan applications for assistance under section 504 pursuant to the program authorized under this section”; and (8) in subsection (i), by striking “other lenders” and inserting “other lenders, specifically comparing default rates and recovery rates on liquidations”. (b) Regulations.— The Administrator shall— (1) not later than 150 days after the date of enactment of this Act, promulgate regulations to carry out the amendments made by subsection (a); and (2) not later than 180 days after the date of enactment of this Act, issue program guidelines and fully implement the amendments made by subsection (a). (c) Program Extension.— Section 217(b) of the Small Business Reauthorization and Amendments Act of 1994 (15 U.S.C. 697e note) is amended by striking “October 1, 1997” and inserting “October 1, 2000”.