Bill Will Help Y2K-Hit Businesses
By JIM ABRAMS Associated Press Writer
WASHINGTON (AP) - Small businesses trying to cope with the Year 2000 computer problem will have access to a new loan program under legislation passed by the House Tuesday and sent to the White House.
The bill, passed by voice vote, authorizes the Small Business Administration to set up a program guaranteeing loans for small businesses trying to either fix their computers or deal with the economic losses resulting from its own or supplier computer breakdowns.
The Senate this month voted 99-0 in favor of the measure sponsored by Sen. Christopher Bond, R-Mo.
Under the bill, the SBA is expected to guarantee about $500 million in loans through the end of the program on Dec. 31, 2000. Studies have concluded that up to 750,000 small businesses could be severely hurt or be forced to shut down because of the glitch in many computers that keeps them from differentiating between the year 2000 and the year 1900.
Rep. James Talent, R-Mo., chairman of the Small Business Committee, said many smaller businesses that have done little to prepare for the so-called Y2K problem depend on a wide range of suppliers and customers who use automated and computerized systems for production, inventory, shipping and billing purposes.
''If one of these links in a small business' supply-and-demand chain is broken due to a computer system that is not Y2K compliant, it would lead to irreparable damage to a business that lacks a large capital pool,'' Talent said.
The bill allows the SBA to guarantee loans of up to $1 million for Y2K readiness. Current law for other SBA loans limits loan guarantees to $750,000. The loans will be provided by more than 6,000 private financial institutions.
The administration has said it has no objections to the small business bill, but has voiced strong reservations about other Y2K bills now working their way through Congress that would limit what could be a deluge of lawsuits arising out of computer failures after Jan. 1, 2000. At issue is how to stop frivolous suits without restricting the legal rights of businesses and consumers damaged by the failure of companies to fix their computers.
The bill is S. 314.
dailynews.yahoo.com |
