[Congressional Bills 106th Congress]
[From the U.S. Government Publishing Office]
[S. 619 Introduced in Senate (IS)]







106th CONGRESS
  1st Session
                                 S. 619

    To provide for a community development venture capital program.


_______________________________________________________________________


                   IN THE SENATE OF THE UNITED STATES

                             March 15, 1999

 Mr. Wellstone introduced the following bill; which was read twice and 
              referred to the Committee on Small Business

_______________________________________________________________________

                                 A BILL


 
    To provide for a community development venture capital program.

    Be it enacted by the Senate and House of Representatives of the 
United States of America in Congress assembled,

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Community Development Venture 
Capital Assistance Act of 1999''.

SEC. 2. FINDINGS.

    Congress finds that--
            (1) there is a need for the development and expansion of 
        organizations that provide private equity capital to smaller 
        businesses in areas in which equity-type capital is scarce, 
        such as inner cities and rural areas, in order to create and 
        retain jobs for low-income residents of those areas;
            (2) to invest successfully in smaller businesses, 
        particularly in inner cities and rural areas, requires highly 
        specialized investment and management skills;
            (3) there is a shortage of professionals who possess such 
        skills and there are few training grounds for individuals to 
        obtain those skills;
            (4) providing assistance to organizations that provide 
        specialized technical assistance and training to individuals 
        and organizations seeking to enter or expand in this segment of 
        the market would stimulate small business development and 
        entrepreneurship in economically distressed communities; and
            (5) assistance from the Federal Government could act as a 
        catalyst to attract investment from the private sector and 
        would help to develop a specialized venture capital industry 
        focused on creating jobs, increasing business ownership, and 
        generating wealth in low-income communities.

SEC. 3. COMMUNITY DEVELOPMENT VENTURE CAPITAL ACTIVITIES.

    The Small Business Act (15 U.S.C. 631 et seq.) is amended--
            (1) by redesignating section 33 (as redesignated by section 
        206(b)(2) of this Act) as section 34; and
            (2) by inserting after section 32 (as added by section 
        206(b)(2) of this Act) the following:

``SEC. 33. COMMUNITY DEVELOPMENT VENTURE CAPITAL ACTIVITIES.

    ``(a) Definitions.--In this section:
            ``(1) Community development venture capital organization.--
        The term `community development venture capital organization' 
        means a privately-controlled organization that--
                    ``(A) has a primary mission of promoting community 
                development in low-income communities, as defined by 
                the Administrator, through investment in private 
                business enterprises; or
                    ``(B) administers or is in the process of 
                establishing a community development venture capital 
                fund for the purpose of making equity investments in 
                private business enterprises in such communities.
            ``(2) Developmental organization.--The term `developmental 
        organization'--
                    ``(A) means a public or private entity, including a 
                college or university, that provides technical 
                assistance to community development venture capital 
                organizations or that conducts research or training in 
                community development venture capital investment; and
                    ``(B) may include an intermediary organization.
            ``(3) Intermediary organization.--The term `intermediary 
        organization'--
                    ``(A) means a private, nonprofit entity that has--
                            ``(i) a primary mission of promoting 
                        community development through investment in 
                        private businesses in low-income communities; 
                        and
                            ``(ii) significant prior experience in 
                        providing technical assistance or financial 
                        assistance to community development venture 
                        capital organizations;
                    ``(B) may include community development venture 
                capital organizations.
    ``(b) Authority.--In order to promote the development of community 
development venture capital organizations, the Administrator, may--
            ``(1) enter into contracts with 1 or more developmental 
        organizations to carry out training and research activities 
        under subsection (c); and
            ``(2) make grants in accordance with this section--
                    ``(A) to developmental organizations to carry out 
                training and research activities under subsection (c); 
                and
                    ``(B) to intermediary organizations to provide 
                intensive marketing, management, and technical 
                assistance and training to community development 
                venture capital organizations under subsection (d).
    ``(c) Training and Research Activities.--
            ``(1) In general.--Subject to paragraph (2), a 
        developmental organization that receives a grant under 
        subsection (b) shall use the funds made available through the 
        grant for 1 or more of the following training and research 
        activities:
                    ``(A) Strengthening professional skills.--Creating 
                and operating training programs to enhance the 
                professional skills for individuals in community 
                development venture capital organizations or operating 
                private community development venture capital funds.
                    ``(B) Increasing interest in community development 
                venture capital.--Creating and operating a program to 
                select and place students and recent graduates from 
                business and related professional schools as interns 
                with community development venture capital 
                organizations and intermediary organizations for a 
                period of up to 1 year, and to provide stipends for 
                such interns during the internship period.
                    ``(C) Promoting `best practices'.--Organizing an 
                annual national conference for community development 
                venture capital organizations to discuss and share 
                information on the best practices regarding issues 
                relevant to the creation and operation of community 
                development venture capital organizations.
                    ``(D) Mobilizing academic resources.--Encouraging 
                the formation of 1 or more centers for the study of 
                community development venture capital at graduate 
                schools of business and management, providing funding 
                for the development of materials for courses on topics 
                in this area, and providing funding for research on 
                economic, operational, and policy issues relating to 
                community development venture capital.
            ``(2) Limitation.--The Administrator shall ensure that not 
        more than 25 percent of the amount made available to carry out 
        this section is used for activities described in paragraph (1).
    ``(d) Intensive Marketing, Management, and Technical Assistance and 
Training.--An intermediary organization that receives a grant under 
subsection (b) shall use the funds made available through the grant to 
provide intensive marketing, management, and technical assistance and 
training to promote the development of community development venture 
capital organizations, which assistance may include grants to community 
development venture capital organizations for the start up costs and 
operating support of those organizations.
    ``(e) Matching Requirement.--The Administrator shall require, as a 
condition of any grant made to an intermediary organization under this 
section, that a matching amount equal to the amount of such grant be 
provided from sources other than the Federal Government.
    ``(f) Requirements.--The Administrator may promulgate such 
regulations as may be necessary to carry out this section, which 
regulations may take effect upon issuance.
    ``(g) Authorization of Appropriations.--There is authorized to be 
appropriated to carry out this section a total of $20,000,000 for 
fiscal years 2000 through 2003.''.
                                 <all>