[Congressional Record Volume 140, Number 137 (Tuesday, September 27, 1994)]
[Senate]
[Page S]
From the Congressional Record Online through the Government Printing Office [www.gpo.gov]


[Congressional Record: September 27, 1994]
From the Congressional Record Online via GPO Access [wais.access.gpo.gov]

 
            SMALL BUSINESS ADMINISTRATION AMENDMENTS OF 1994

  Mr. METZENBAUM. Mr. President, I ask that the Chair lay before the 
Senate a message from the House of Representatives on a bill (S. 2060) 
to amend the Small Business Act and the Small Business Investment Act 
of 1958, and for other purposes.
  The PRESIDING OFFICER laid before the Senate the following message 
from the House of Representatives:

       Resolved, That the bill from the Senate (S. 2060) entitled 
     ``An Act to amend the Small Business Act and the Small 
     Business Investment Act of 1958, and for other purposes'', do 
     pass with the following amendments:
       Strike out all after the enacting clause and insert:
     That this Act may be cited as the ``Small Business 
     Reauthorization and Amendment Act of 1994''.
                        TITLE I--AUTHORIZATIONS

     SEC. 101. AUTHORIZATIONS.

       Section 20 of the Small Business Act (15 U.S.C. 631 note) 
     is amended by striking all of such section after subsection 
     (k), as added by section 115(a) of the Small Business Credit 
     and Business Opportunity Enhancement Act of 1992, and by 
     inserting in lieu thereof the following:
       ``(l) The following program levels are authorized for 
     fiscal year 1995:
       ``(1) For the programs authorized by this Act, the 
     Administration is authorized to make $142,000,000 in direct 
     and immediate participation loans; and of such sum, the 
     Administration is authorized to make $12,000,000 in loans as 
     provided in section 7(a)(10) and $130,000,000 in loans as 
     provided in section 7(m).
       ``(2) For the programs authorized by this Act, the 
     Administration is authorized to make $11,535,000,000 in 
     deferred participation loans and other financings. Of such 
     sum, the Administration is authorized to make--
       ``(A) $9,315,000,000 in general business loans as provided 
     in section 7(a);
       ``(B) $2,200,000,000 in financings as provided in section 
     7(a)(13) and section 504 of the Small Business Investment Act 
     of 1958; and
       ``(C) $20,000,000 in loans as provided in section 7(m).
       ``(3) For the programs authorized by title III of the Small 
     Business Investment Act of 1958, the Administration is 
     authorized to make--
       ``(A) $23,000,000 in purchases of preferred securities;
       ``(B) $244,000,000 in guarantees of debentures, of which 
     $44,000,000 is authorized in guarantees of debentures from 
     companies operating pursuant to section 301(d) of such Act; 
     and
       ``(C) $400,000,000 in guarantees of participating 
     securities.
       ``(4) For the programs authorized by part B of title IV of 
     the Small Business Investment Act of 1958, the Administration 
     is authorized to enter into guarantees not to exceed 
     $1,800,000,000, of which not more than $600,000,000 may be in 
     bonds approved pursuant to the provisions of section 
     411(a)(3) of such Act.
       ``(5) For the Service Corps of Retired Executives program 
     authorized by section 8(b)(1) of this Act, the Administration 
     is authorized to make grants or enter cooperative agreements 
     not to exceed $3,500,000, and for the small business 
     institute program authorized by section 8(b)(1) of this Act, 
     the Administration is authorized to make grants or enter 
     cooperative agreements not to exceed $3,000,000.
       ``(m) There are authorized to be appropriated to the 
     Administration for fiscal year 1995 such sums as may be 
     necessary to carry out the provisions of this Act, including 
     administrative expenses and necessary loan capital for 
     disaster loans pursuant to section 7(b), and to carry out the 
     provisions of the Small Business Investment Act of 1958, 
     including salaries and expenses of the Administration.
       ``(n) The following program levels are authorized for 
     fiscal year 1996:
       ``(1) For the programs authorized by this Act, the 
     Administration is authorized to make $198,000,000 in direct 
     and immediate participation loans; and of such sum the 
     Administration is authorized to make $13,000,000 in loans as 
     provided in section 7(a)(10) and $185,000,000 in loans as 
     provided in section 7(m).
       ``(2) For the programs authorized by this Act, the 
     Administration is authorized to make $13,465,000,000 in 
     deferred participation loans and other financings. Of such 
     sum, the Administration is authorized to make--
       ``(A) $10,935,000,000 in general business loans as provided 
     in section 7(a);
       ``(B) $2,500,000,000 in financings as provided in section 
     7(a)(13) and section 504 of the Small Business Investment Act 
     of 1958; and
       ``(C) $30,000,000 in loans as provided in section 7(m).
       ``(3) For the programs authorized by title III of the Small 
     Business Investment Act of 1958, the Administration is 
     authorized to make--
       ``(A) $24,000,000 in purchases of preferred securities;
       ``(B) $256,000,000 in guarantees of debentures, of which 
     $46,000,000 is authorized in guarantees of debentures from 
     companies operating pursuant to section 301(d) of such Act; 
     and
       ``(C) $650,000,000 in guarantees of participating 
     securities.
       ``(4) For the programs authorized by part B of title IV of 
     the Small Business Investment Act of 1958, the Administration 
     is authorized to enter into guarantees not to exceed 
     $1,800,000,000, of which not more than $600,000,000 may be in 
     bonds approved pursuant to the provisions of section 
     411(a)(3) of such Act.
       ``(5) For the Service Corps of Retired Executives program 
     authorized by section 8(b)(1) of this Act, the Administration 
     is authorized to make grants or enter cooperative agreements 
     not to exceed $3,675,000, and for the small business 
     institute program authorized by section 8(b)(1) of this Act, 
     the Administration is authorized to make grants or enter 
     cooperative agreements not to exceed $3,150,000.
       ``(o) There are authorized to be appropriated to the 
     Administration for fiscal year 1996 such sums as may be 
     necessary to carry out the provisions of this Act, including 
     administrative expenses and necessary loan capital for 
     disaster loans pursuant to section 7(b), and to carry out the 
     provisions of the Small Business Investment Act of 1958, 
     including salaries and expenses of the Administration.
       ``(p) The following program levels are authorized for 
     fiscal year 1997:
       ``(1) For the programs authorized by this Act, the 
     Administration is authorized to make $264,000,000 in direct 
     and immediate participation loans; and of such sum the 
     Administration is authorized to make $14,000,000 in loans as 
     provided in section 7(a)(10) and $250,000,000 in loans as 
     provided in section 7(m).
       ``(2) For the programs authorized by this Act, the 
     Administration is authorized to make $17,215,000,000 in 
     deferred participation loans and other financings. Of such 
     sum, the Administration is authorized to make--
       ``(A) $14,175,000,000 in general business loans as provided 
     in section 7(a);
       ``(B) $3,000,000,000 in financings as provided in section 
     7(a)(13) and section 504 of the Small Business Investment Act 
     of 1958; and
       ``(C) $40,000,000 in loans as provided in section 7(m).
       ``(3) For the programs authorized by title III of the Small 
     Business Investment Act of 1958, the Administration is 
     authorized to make--
       ``(A) $25,000,000 in purchases of preferred securities;
       ``(B) $268,000,000 in guarantees of debentures, of which 
     $48,000,000 is authorized in guarantees of debentures from 
     companies operating pursuant to section 301(d) of such Act; 
     and
       ``(C) $900,000,000 in guarantees of participating 
     securities.
       ``(4) For the programs authorized by part B of title IV of 
     the Small Business Investment Act of 1958, the Administration 
     is authorized to enter into guarantees not to exceed 
     $1,800,000,000, of which not more than $600,000,000 may be in 
     bonds approved pursuant to the provisions of section 
     411(a)(3) of such Act.
       ``(5) For the Service Corps of Retired Executives program 
     authorized by section 8(b)(1) of this Act, the Administration 
     is authorized to make grants or enter cooperative agreements 
     not to exceed $3,860,000, and for the small business 
     institute program authorized by section 8(b)(1) of this Act, 
     the Administration is authorized to make grants or enter 
     cooperative agreements not to exceed $3,310,000.
       ``(q) There are authorized to be appropriated to the 
     Administration for fiscal year 1997 such sums as may be 
     necessary to carry out the provisions of this Act, including 
     administrative expenses and necessary loan capital for 
     disaster loans pursuant to section 7(b), and to carry out the 
     provisions of the Small Business Investment Act of 1958, 
     including salaries and expenses of the Administration.''.
                TITLE II--FINANCIAL ASSISTANCE PROGRAMS

     SEC. 201. MICROLOAN FINANCING PILOT.

       Section 7(m) of the Small Business Act (15 U.S.C. 636(m)) 
     is amended by adding the following new paragraph at the end:
       ``(12) Deferred participation loan pilot.--During fiscal 
     years 1995 through 1997, on a pilot basis, in lieu of making 
     direct loans to intermediaries as authorized in paragraph 
     (1)(B), the Administration may participate on a deferred 
     basis of up to 100 percent on loans made to intermediaries by 
     a for-profit or non-profit entity or by alliances of such 
     entities subject to the following conditions:
       ``(A) Number of loans.--The Administration shall not 
     participate in providing financing on a deferred basis to 
     more than ten intermediaries in urban areas per year and to 
     more than ten intermediaries in rural areas per year.
       ``(B) Term of loans.--The term of such loans shall be ten 
     years. During the first five years of the loan, the 
     intermediary shall be required to pay interest only; and 
     during the second five years of the loan, the intermediary 
     shall be required to fully amortize principal and interest 
     payments.
       ``(C) Interest rate.--The interest rate on such loans shall 
     be the rate specified by paragraph (3)(F) for direct 
     loans.''.

     SEC. 202. MICROLOAN STATE LIMITATION.

       Section 7(m)(7)(C) of the Small Business Act (15 U.S.C. 
     636(m)(7)(C)) is repealed.

     SEC. 203. LIMIT ON PARTICIPATION.

       Section 7(m)(7)(A) of the Small Business Act (15 U.S.C. 
     636(m)(7)(A)) is amended to read as follows:
       ``(A) Number of participants.--During this demonstration 
     program, the Administration is authorized to fund, on a 
     competitive basis, not more than 240 microloan programs.''.

     SEC. 204. EQUITABLE DISTRIBUTION.

       Section 7(m)(8) of the Small Business Act (15 U.S.C. 
     636(m)(8)) is amended to read as follows:
       ``(8) Equitable distribution of intermediaries.--In 
     approving microloan program applicants, the Administration 
     shall select participation by such intermediaries as will 
     ensure appropriate availability of loans to small businesses 
     located in urban areas and in rural areas.''.

     SEC. 205. AMOUNT OF LOANS TO INTERMEDIARIES.

       Section 7(m)(3)(C) of the Small Business Act (15 U.S.C. 
     636(m)(3)(C)) is amended to read as follows:
       ``(C) Loan limits.--In determining the amount of funding 
     which the Administration may provide to one intermediary, it 
     shall take into consideration the small business population 
     in the area served by the intermediary.''.

     SEC. 206. LOANS TO EXPORTERS.

       Section 7(a)(14)(A) of the Small Business Act (15 U.S.C. 
     636(a)(14)(A)) is amended to read as follows:
       ``(A) The Administration may provide extensions, standby 
     letters of credit, revolving lines of credit for export 
     purposes, and other financing to enable small business 
     concerns, including small business export trading companies 
     and small business export management companies, to develop 
     foreign markets. A bank or participating lending institution 
     may establish the rate of interest on such financings as may 
     be legal and reasonable.''.

     SEC. 207. WORKING CAPITAL INTERNATIONAL TRADE LOANS.

       Section 7(a)(3)(B) of the Small Business Act (15 U.S.C. 
     636(a)(3)(B)) is amended to read as follows:
       ``(B) if the total amount outstanding and committed (on a 
     deferred basis) solely for the purposes provided in paragraph 
     (16) to the borrower from the business loan and investment 
     fund established by this Act would exceed $1,250,000, of 
     which not more than $750,000 may be used for working capital, 
     supplies, or financings under section 7(a)(14) for export 
     purposes; and''.

     SEC. 208. GUARANTEES ON INTERNATIONAL TRADE LOANS.

       Section 7(a)(2)(B)(iv) of the Small Business Act (15 U.S.C. 
     636(a)(2)(B)(iv)) is amended to read as follows:
       ``(iv) not less than 85 percent nor more than 90 percent of 
     the financing outstanding at the time of disbursement if such 
     financing is a loan under paragraph (14) or under paragraph 
     (16).''.

     SEC. 209. ACCREDITED LENDERS PROGRAM.

       (a) Title V of the Small Business Investment Act of 1958 
     (15 U.S.C. 695 et seq.) is amended by adding at the end the 
     following new section:

     ``SEC. 507. ACCREDITED LENDERS PROGRAM.

       ``(a) The Administration is authorized to establish an 
     Accredited Lenders Program for qualified State and local 
     development companies which meet the requirements of 
     subsection (b).
       ``(b) The Administration may designate a qualified State or 
     local development company as an accredited lender if such 
     company--
       ``(1) has been an active participant in the development 
     company program for at least the last 12 months;
       ``(2) has well-trained, qualified personnel who are 
     knowledgeable in the Administration's lending policies and 
     procedures for the development company program;
       ``(3) has the ability to process, close, and service 
     financing for plant and equipment under section 502 of this 
     Act;
       ``(4) has a loss rate on its debentures that is acceptable 
     to the Administration;
       ``(5) has a history of submitting to the Administration 
     complete and accurate debenture guaranty application 
     packages; and
       ``(6) has demonstrated the ability to serve small business 
     credit needs for financing plant and equipment as provided in 
     section 502 of this Act.
       ``(c) The Administration shall expedite the processing of a 
     loan application or servicing action submitted by a qualified 
     State or local development company that has been designated 
     as an accredited lender in accordance with subsection (b).
       ``(d) The designation of a qualified State or local 
     development company as an accredited lender may be suspended 
     or revoked if the Administration determines that the 
     development company has not continued to meet the criteria 
     for eligibility under subsection (b) or that the development 
     company has failed to adhere to the Administration's rules 
     and regulations or is violating any other applicable 
     provision of law. Suspension or revocation shall not affect 
     any outstanding debenture guarantee.
       ``(e) For purposes of this section, the term `qualified 
     State or local development company' has the same meaning as 
     in section 503(e).''.
       (b) The Administration shall promulgate regulations to 
     carry out this section within 90 days of the date of the 
     enactment of this Act.
       (c) The Administration shall report to the Small Business 
     Committee of the United States Senate and to the Small 
     Business Committee of the United States House of 
     Representatives within one year, and annually thereafter, on 
     the implementation of this section, specifically including 
     data on the number of development companies designated as 
     accredited lenders, their debenture guarantee volume, their 
     loss rates, and the average processing time on their 
     guarantee applications, along with such other information as 
     the Administration deems appropriate.

     SEC. 210. PREMIER LENDERS PROGRAM.

       (a) Title V of the Small Business Investment Act of 1958 
     (15 U.S.C. 695 et seq.) is further amended by adding at the 
     end the following new section:

     ``SEC. 508. PREMIER LENDERS PROGRAM.

       ``(a) The Administration is authorized to establish a 
     Premier Lenders Program for certified development companies 
     which meet the requirements of subsection (b).
       ``(b) The Administration may designate a participant in the 
     accredited lenders program as a premier lender if such 
     company--
       ``(1) has been an active participant in the accredited 
     lenders program for at least the last 12 months: Provided, 
     That prior to January 1, 1996, the Administration may waive 
     this provision if the applicant is qualified to participate 
     in the accredited lenders program;
       ``(2) has a history of submitting to the Administration 
     adequately analyzed debenture guarantee application packages; 
     and
       ``(3) agrees to assume and to reimburse the Administration 
     for 5 percent of any loss sustained by the Administration on 
     account of default by the certified development company in 
     the payment of principal or interest on a debenture issued by 
     such company and guaranteed by the Administration under this 
     section.
       ``(c) Upon approval of an applicant as a premier lender, 
     the certified development company shall establish a loss 
     reserve in an amount equal to the anticipated losses to the 
     certified development company pursuant to subsection (b)(3) 
     based upon the historic loss rate on debentures issued by 
     such company, or 3 percent of the aggregate principal amount 
     of debentures issued by such company and guaranteed by the 
     Administration under this section, whichever is greater. The 
     loss reserve shall be comprised of segregated assets of the 
     development company which shall be securitized in favor of 
     the Administration or of such unqualified letters of credit 
     or indemnity agreements from a third party as the 
     Administration deems appropriate.
       ``(d) Upon designation and qualification of a company as a 
     premier lender, and subject to such terms and conditions as 
     the Administration may determine, and notwithstanding the 
     provisions of section 503(b)(6), the Administration may 
     permit a premier lender to approve loans to be funded with 
     the proceeds of and to authorize the guarantee of a debenture 
     issued by such company. The approval by the premier lender 
     shall be subject to the final approval as to eligibility of 
     any such guarantee by the Administration pursuant to 
     subsection 503(a) of this Act, but such final approval shall 
     not include decisions by the company involving 
     creditworthiness, loan closing, or compliance with legal 
     requirements imposed by law or regulation.
       ``(e) The designation of a qualified State or local 
     development company as a premier lender may be suspended or 
     revoked if the Administration determines that the company--
       ``(1) has not continued to meet the criteria for 
     eligibility under subsection (b);
       ``(2) has not established or maintained the loss reserve 
     required under subsection (c); or
       ``(3) is failing to adhere to the Administration's rules 
     and regulations or is violating any other applicable 
     provision of law.
       ``(f) Suspension or revocation shall not affect any 
     outstanding debenture guarantee.''.
       (b) The Administration shall promulgate such regulations to 
     carry out this section within 180 days of the date of the 
     enactment of this Act.
       (c) The Administration shall report to the Small Business 
     Committee of the United States Senate and to the Small 
     Business Committee of the United States House of 
     Representatives within one year, and annually thereafter, on 
     the implementation of this section, specifically including 
     data on the number of development companies designated as 
     premier lenders, their debenture guarantee volume, and the 
     loss rate for premier lenders as compared to accredited and 
     other lenders, along with such other information as the 
     Administration deems appropriate.
       (d) Section 508 of the Small Business Investment Act of 
     1958 is repealed on October 1, 1999.
       (e) The table of contents contained in section 101 of the 
     Small Business Investment Act of 1958 is amended by adding at 
     the end of the matter relating to title V the following:

``Sec. 507. Accredited lenders program.
``Sec. 508. Premier lenders program.''.

     SEC. 211. SSBIC ADVISORY COUNCIL.

       (a) Council Established.--Not later than 90 days after the 
     date of the enactment of this Act, the Administrator of the 
     Small Business Administration shall appoint an Investment 
     Advisory Council for the Specialized Small Business 
     Investment Company Program. The Council shall consist of not 
     less than 12 individuals from the private sector, including 
     individuals--
       (1) who have experience in providing venture capital to 
     small business, particularly minority small business;
       (2) who are current participants in the Specialized Small 
     Business Investment Company Program;
       (3) who are former participants in the Specialized Small 
     Business Investment Company Program; or
       (4) who are or who represent small business concerns.
       (b) Chairman and Staff.--The Administrator shall designate 
     one of the members of the Council as chairperson. The 
     Investment Division of the Small Business Administration 
     shall provide such staff, technical support, and information 
     as shall be deemed appropriate. Council members shall be 
     deemed to be an advisory board pursuant to section 8(b)(13) 
     of the Small Business Act for purposes of reimbursement of 
     expenses.
       (C) Report.--Within six months of the date of appointment, 
     the Council shall make a written report with findings and 
     recommendations on the venture capital needs, including debt 
     and equity, of socially or economically disadvantaged small 
     business concerns and any needed Federal incentives to assist 
     the private sector to meet such needs. The report shall 
     specifically address--
       (1) the history of the Specialized Small Business 
     Investment Company program in providing assistance to such 
     concerns and the impact of such assistance on the economy;
       (2) the appropriateness and ability of the Specialized 
     Small Business Investment Company Program to meet these 
     needs;
       (3) the problems affecting the Specialized Small Business 
     Investment Company Program; and
       (4) the effectiveness of the Specialized Small Business 
     Investment Company Program and its administration by the 
     Small Business Administration.

     SEC. 212. PARTICIPATING SECURITIES FOR SMALLER SBICS.

       Section 303(g) of the Small Business Investment Act of 1958 
     (15 U.S.C. 683(g)) is amended by adding the following new 
     paragraph at the end:
       ``(13) Of the amount of the annual program level of 
     participating securities approved in Appropriations Acts, 50 
     percent shall be reserved for funding Small Business 
     Investment Companies with private capital of less than 
     $20,000,000; except that during the last quarter of each 
     fiscal year, the Administrator may, if he determines that 
     there is a lack of qualified applicants with private capital 
     under such amount, utilize all or any part of the securities 
     so reserved.''.

     SEC. 213. REPORT ON SBIC PROGRAM.

       The Small Business Administration shall provide the 
     Committee on Small Business of the House of Representatives 
     and Senate with a comprehensive report on the status and 
     disposition of all Small Business Investment Companies, 
     active or in liquidation, and a complete accounting of the 
     assets in and the basis of their portfolios, the projected 
     and actual loss rates for all portfolios in liquidation or 
     active, and a detailed accounting of valuation of the SBIC 
     program's investments. This report shall be delivered to the 
     respective Committees on Small Business no later than April 
     15, 1995.
             TITLE III--SIZE STANDARDS AND BOND GUARANTEES

     SEC. 301. COMPETITIVE DEMONSTRATION PROJECT SIZE STANDARDS.

       Section 732 of the Business Opportunity Development Reform 
     Act of 1988 (Public Law 100-656) is amended by repealing the 
     second sentence of such section.

     SEC. 302. SIZE STANDARD CRITERIA.

       Section 3(a)(2) of the Small Business Act (15 U.S.C. 
     632(a)(2)) is amended to read as follows:
       ``(2) In addition to the criteria specified in paragraph 
     (1), the Administrator may specify detailed definitions or 
     standards by which a business concern may be determined to be 
     a small business concern for the purposes of this Act or any 
     other Act. Such standards may utilize number of employees, 
     dollar volume of business, net worth, net income, or a 
     combination thereof. Unless specifically authorized by 
     statute, no Federal department or agency may prescribe a size 
     standard for categorizing a business concern as a small 
     business concern, unless such proposed size standard--
       ``(A) is being proposed after an opportunity for public 
     notice and comment;
       ``(B) provides for determining--
       ``(i) the size of a manufacturing concern as measured by 
     its average employment based upon employment during each of 
     the concern's pay periods for the preceding twelve calendar 
     months;
       ``(ii) the size of a concern providing services on the 
     basis of the annual average gross receipts of the concern 
     over a period of not less than 3 years; and
       ``(iii) the size of other concerns on the basis of data 
     over a period of not less than 3 years; and
       ``(C) is approved by the Administrator if it is not being 
     proposed by the Small Business Administration.''.

     SEC. 303. SUNSET ON PREFERRED SURETY BOND GUARANTEE PROGRAM.

       Section 207 of the Small Business Administration 
     Reauthorization and Amendment Act of 1988 (Public Law 100-
     590) is amended by striking ``September 30, 1994'' and by 
     inserting in lieu thereof ``September 30, 1997''.

     SEC. 304. VERY SMALL BUSINESS CONCERNS.

       The Small Business Act (15 U.S.C. 631 et seq.) is amended 
     by redesignating section 30 as section 41 and by inserting 
     after section 29, as redesignated by section 606 of this Act, 
     the following:

     ``SEC. 30. PILOT PROGRAM FOR VERY SMALL BUSINESS CONCERNS.

       ``(a) Establishment.--The Administration shall establish 
     and carry out a pilot program in accordance with the 
     requirements of this section to provide procurement 
     opportunities to very small business concerns.
       ``(b) Subcontracting of Procurement Contracts.--
       ``(1) In general.--In carrying out the program, the 
     Administration is authorized to enter into procurement 
     contracts with the United States Government and to arrange 
     for the performance of such contracts through the award of 
     subcontracts to very small business concerns.
       ``(2) Terms and conditions.--The authority of the 
     Administration under paragraph (1) shall be subject to the 
     same terms and conditions as apply to the authority of the 
     Administration under section 8(a), except that--
       ``(A) the Administration may make such modifications to 
     such terms and conditions as the Administration determines 
     necessary; and
       ``(B) all contract opportunities offered for award under 
     the program shall be awarded on the basis of competition 
     restricted to eligible program participants.
       ``(c) Program Participation.--Very small business concerns 
     participating in the program shall be subject to the same 
     terms and conditions for program participation as apply to 
     program participants under sections 7(j) and 8(a); except 
     that--
       ``(1) the Administration may make such modifications to 
     such terms and conditions as the Administration determines 
     necessary; and
       ``(2) eligibility shall be determined on the basis of 
     qualifying as a very small business concern as defined in 
     subsection (g), in lieu of the requirements contained in 
     paragraphs (4), (5), and (6) of section 8(a).
       ``(d) Technical and Financial Assistance.--In order to 
     assist very small business concerns participating in the 
     program, the Administration is authorized--
       ``(1) to provide technical assistance to such concerns in 
     the same manner and to the same extent as technical 
     assistance is provided to small business concerns pursuant to 
     section 7(j); and
       ``(2) to provide pre-authorization to such concerns for the 
     purpose of receiving financial assistance under section 7(a).
       ``(e) Program Term.--The Administration shall carry out the 
     program in each of fiscal years 1995, 1996, and 1997.
       ``(f) Report to Congress.--On or before December 31, 1996, 
     the Administration shall transmit to Congress a report 
     containing an analysis of the results of the program, 
     together with recommendations for appropriate legislative and 
     administrative actions.
       ``(g) Definitions.--For the purposes of this section, the 
     following definitions apply:
       ``(1) Program.--The term `program' means the program 
     established pursuant to subsection (a).
       ``(2) Very small business concern.--The term `very small 
     business concern' means a small business concern that--
       ``(A) has 10 employees or less; or
       ``(B) has average annual receipts that total $1,000,000 or 
     less.''.
                    TITLE IV--MANAGEMENT ASSISTANCE

     SEC. 401. SUNSET ON COSPONSORED TRAINING.

       (a) The authority of the Small Business Administration to 
     cosponsor training as authorized by section 5(a) of the Small 
     Business Computer Security and Education Act of 1984 (15 
     U.S.C. 633 note) is hereby repealed September 30, 1997.
       (b) Section 7(b) of the Small Business Computer Security 
     and Education Act of 1984 (15 U.S.C. 633 note) is amended by 
     striking the second sentence.

     SEC. 402. SMALL BUSINESS DEVELOPMENT CENTER PROGRAM LEVEL.

       Section 21(a)(4) of the Small Business Act (15 U.S.C. 
     648(a)(4)) is amended to read as follows:
       ``(4) The Administration shall require as a condition of 
     any grant (or amendment or modification thereof) made to an 
     applicant under this section, that a matching amount 
     (excluding any fees collected from recipients of such 
     assistance) equal to the amount of such grant be provided 
     from sources other than the Federal Government, to be 
     comprised of not less than 50 per centum cash and not more 
     than 50 per centum of indirect costs and in-kind 
     contributions: Provided, That this matching amount shall not 
     include any indirect costs or in-kind contributions derived 
     from any Federal program: Provided further, That no recipient 
     of funds under this section shall receive a grant which would 
     exceed its pro rata share of a national program based upon 
     the population to be served by the Small Business Development 
     Center as compared to the total population in the United 
     States, plus $125,000, or $200,000, whichever is greater, per 
     year. The amount of the national program shall be--
       ``(A) $70,000,000 through September 30, 1995;
       ``(B) $77,500,000 from October 1, 1995 through September 
     30, 1996; and
       ``(C) $85,000,000 beginning October 1, 1996.
     The amount of eligibility of each Small Business Development 
     Center shall be based upon the amount of the national program 
     in effect as of the date for commencement of performance of 
     the Center's grant.''.

     SEC. 403. FEDERAL CONTRACTS WITH SMALL BUSINESS DEVELOPMENT 
                   CENTERS.

       (a) Section 21(a)(5) of the Small Business Act (15 U.S.C. 
     648(a)(5)) is amended to read as follows:
       ``(5) A Small Business Development Center may enter a 
     contract with a Federal department or agency to provide 
     specific assistance to small business concerns if the 
     contract is approved in advance by the Deputy Associate 
     Administrator of the Small Business Development Center 
     program. Approval shall be based upon a determination that 
     the contract will provide assistance to small business 
     concerns and that its performance will not hinder the Center 
     in carrying out the terms of its grant from the 
     Administration. The amount of any such contract shall not be 
     subject to the matching funds requirements of paragraph (4) 
     nor shall the amount of eligibility under such paragraph: 
     Provided, That notwithstanding any other provision of law, 
     such contracts for assistance to small business concerns 
     shall not be counted toward any Federal department or 
     agency's small business, women-owned business, or socially 
     and economically disadvantaged business contracting goal as 
     established by section 15(g) of the Small Business Act (15 
     U.S.C. 644(g)).''.
       (b) Section 21(a)(6) of the Small Business Act (15 U.S.C. 
     648(a)(6)) is amended by striking ``paragraphs (4) and (5)'' 
     and by inserting in lieu thereof ``paragraph (4)''.

     SEC. 404. CENTRAL EUROPEAN SMALL BUSINESS DEVELOPMENT.

       Section 25(i) of the Small Business Act (15 U.S.C. 652(i)) 
     is amended by striking ``and $2,000,000 for each of fiscal 
     years 1993 and 1994'' and by inserting in lieu thereof ``, 
     $2,000,000 for each of fiscal years 1993 and 1994, and 
     $1,000,000 for fiscal year 1995''.

     SEC. 405. MOBILE RESOURCE CENTER PILOT PROGRAM.

       (a) Establishment.--The Administrator of the Small Business 
     Administration may establish and carry out in each of fiscal 
     years 1995, 1996, and 1997 a mobile resource pilot program 
     (in this section referred to as the ``program'' in accordance 
     with the requirements of this section.
       (b) Mobile Resource Center Vehicles.--Under the program, 
     the Administration may use mobile resource center vehicles to 
     provide technical assistance, information, and other services 
     available from the Small Business Administration to 
     traditionally underserved populations. Two of such vehicles 
     should be utilized in rural areas and 2 of such vehicles 
     should be utilized in urban areas.
       (c) Report to Congress.--If the Administrator conducts the 
     program authorized in this section, not later than December 
     31, 1996, he shall transmit to Congress a report containing 
     the results of such program, together with recommendations 
     for appropriate legislative and administrative actions.
       (d) Authorization of Appropriations.--There is authorized 
     to be appropriated for fiscal year 1995 $900,000 to carry out 
     this section. Of such sums--
       (1) $800,000 may be made available for the purchase or 
     lease of mobile resource center vehicles; and
       (2) $100,000 may be made available for studies, startup 
     expenses, and other administrative expenses.
     Such sums shall remain available until expended.
        TITLE V--RELIEF FROM FFB DEBENTURE PREPAYMENT PENALTIES

     SEC. 501. CITATION.

       This title may be cited as the ``Small Business Prepayment 
     Penalty Relief Act of 1994.''.

     SEC. 502. MODIFICATION OF DEVELOPMENT COMPANY DEBENTURE 
                   INTEREST RATES.

       (a) In General.--Upon the request of the issuer and the 
     concurrence of the borrower, the Small Business 
     Administration is authorized to transfer to the Federal 
     Financing Bank such sums as may be necessary to carry out the 
     provisions of this section in order to reduce the interest 
     rate on a debenture issued by a certified development 
     company. The reduction shall be effective January 2, 1995 and 
     shall apply for the remainder of the term of the debenture.
       (b) Interest Rate Modification.--Upon receipt of such 
     payment, the Federal Financing Bank shall modify the interest 
     rate of each debenture for which the payment is made. No 
     other change shall be made in the terms and conditions of the 
     debenture, and the modification in the interest rate shall 
     not be construed as a new direct loan or a new loan 
     guarantee.
       (c) Definitions.--For the purposes of this section--
       (1) the term ``issuer'' means the issuer of a debenture 
     pursuant to section 503 of the Small Business Investment Act 
     of 1958 which has been purchased by the Federal Financing 
     Bank if the debenture is outstanding on the date of enactment 
     of this Act, and neither the loan that secures the debenture 
     nor the debenture is in default on such date; and
       (2) the term ``borrower'' means the small business concern 
     whose loan secures a debenture issued pursuant to such 
     section.
       (d) Other Rights.--A modification of the interest rate on a 
     debenture as authorized in this section shall not affect any 
     rights or options of the issuer or borrower which are 
     otherwise authorized by contract or by law.
       (e) Refinancing.--Debentures authorized by sections 504 and 
     505 of the Small Business Investment Act of 1958 may be used 
     to refinance debentures issued under section 503 of such Act 
     if the amount of the new financing is limited to such amounts 
     as are needed to repay the existing debenture, including any 
     prepayment penalty imposed by the Federal Financing Bank. Any 
     such refinancing shall be subject to all of the other 
     provisions of sections 504 and 505 of such Act and the rules 
     and regulations of the Administration promulgated thereunder, 
     including, but not limited to, rules and regulations 
     governing payment of authorized expenses and commissions, 
     fees and discounts to brokers and dealers in trust 
     certificates issued pursuant to section 505: Provided, 
     however, That no applicant for refinancing under section 504 
     of this Act need demonstrate that the requisite number of 
     jobs will be created or preserved with the proceeds of such 
     refinancing: Provided further, That a development company 
     which provides refinancing under this subsection shall be 
     limited to a loan processing fee not to exceed one-half of 
     one percent to cover the cost of packaging, processing and 
     other nonlegal staff functions.

     SEC. 503. MODIFICATION OF SMALL BUSINESS INVESTMENT COMPANY 
                   DEBENTURE INTEREST RATES.

       (a) In General.--Upon the request of the issuer, the Small 
     Business Administration is authorized to transfer to the 
     Federal Financing Bank such sums as may be necessary to carry 
     out the provisions of this section in order to reduce the 
     interest rate on a debenture issued by a Small Business 
     Investment Company under the provisions of title III of the 
     Small Business Investment Act of 1958. The reduction shall be 
     effective January 2, 1995 and shall apply for the remainder 
     of the term of the debenture.
       (b) Interest Rate Modification.--Upon receipt of such 
     payment, the Federal Financing Bank shall modify the interest 
     rate of each debenture for which the payment is made. No 
     other change shall be made in the terms and conditions of the 
     debenture, and the modification in the interest rate shall 
     not be construed as a new direct loan or a new loan 
     guarantee.
       (c) Definitions.--For the purposes of this section, the 
     term ``issuer'' means the issuer of a debenture pursuant to 
     section 303 of the Small Business Investment Act of 1958 
     which has been purchased by the Federal Financing Bank if the 
     debenture is outstanding on the date of enactment of this 
     Act, and is not in default on such date.
       (d) Other Rights.--A modification of the interest rate on a 
     debenture as authorized in this section shall not affect any 
     rights or options of the issuer which are otherwise 
     authorized by contract or by law.

     SEC. 504. MODIFICATION OF SPECIALIZED SMALL BUSINESS 
                   INVESTMENT COMPANY DEBENTURE INTEREST RATES.

       (a) Interest Rate Modification.--Upon the request of the 
     issuer, the Small Business Administration is authorized to 
     modify the interest rate on a debenture issued by a Small 
     Business Investment Company licensed under the provisions of 
     section 301(d) of the Small Business Investment Act of 1958 
     and which is held by the Administration. No debenture which 
     has been sold to a third party shall be eligible for 
     modification under this section. The reduction shall be 
     effective January 2, 1995 and shall apply for the remainder 
     of the term of the debenture. No other change shall be made 
     in the terms and conditions of the debenture, and the 
     modification in the interest rate shall not be construed as a 
     new direct loan or a new loan guarantee.
       (b) Definitions.--For the purposes of this section, the 
     term ``issuer'' means a Specialized Small Business Investment 
     Company licensed under the provisions of section 301(d) of 
     the Small Business Investment Act of 1958 which has issued a 
     debenture which has been funded by the Small Business 
     Administration, providing the debenture is outstanding on the 
     date of enactment of this Act and is not in default on such 
     date.
       (c) Other Rights.--A modification of the interest rate on a 
     debenture as authorized in this section shall not affect any 
     rights or options of the issuer which are otherwise 
     authorized by contract or by law.

     SEC. 505. INTEREST RATE REDUCTIONS.

       (a) In General.--Upon enactment of an Appropriations Act 
     providing funds to carry out the provisions of this Act and 
     limited to amounts specifically provided in advance in 
     Appropriations Acts, the Small Business Administration shall 
     evaluate the outstanding portfolio of debentures which are 
     eligible for interest rate relief under this Act. The 
     Administration shall apply the funds appropriated to carry 
     out this Act in order to reduce the highest interest rate on 
     all eligible debentures to a uniform rate.
       (b) Authorization.--There are authorized to be appropriated 
     $30 million to carry out the provisions of this Act in fiscal 
     year 1995.
            TITLE VI--DEVELOPMENT OF WOMEN-OWNED BUSINESSES

     SEC. 601. STATUS OF COUNCIL.

       Section 401 of the Women's Business Ownership Act of 1988 
     (15 U.S.C. 631 note) is redesignated as section 405 of such 
     Act and, as redesignated, is amended--
       (1) in the heading by inserting ``OF THE COUNCIL'' after 
     ``ESTABLISHMENT''; and
       (2) by striking the period at the end and inserting the 
     following: ``which shall serve as an independent advisory 
     council to the Interagency Committee on Women's Business 
     Enterprise, to the Administrator of the Small Business 
     Administration, and to the Congress of the United States. The 
     Council, in order to carry out its function as an independent 
     advisory council to the Congress, is authorized and directed 
     to report independently of the Interagency Committee directly 
     to the Congress at such times and on such matters as it, in 
     its discretion, deems appropriate.''.

     SEC. 602. DUTIES OF NATIONAL WOMEN'S BUSINESS COUNCIL.

       Section 402 of the Women's Business Ownership Act of 1988 
     (15 U.S.C. 631 note) is redesignated as section 406 of such 
     Act and, as redesignated, is amended to read as follows:

     ``SEC. 406. DUTIES OF THE COUNCIL.

       ``The Council shall meet at such times as it determines 
     necessary in order to advise and consult with the Interagency 
     Committee on Women's Business Enterprise on matters relating 
     to the activities, functions, and policies of such Committee 
     as provided in this title. The Council shall make annual 
     recommendations for consideration by the Committee. The 
     Council also shall provide reports and make such other 
     recommendations as it deems appropriate to the Committee, to 
     the Administrator of the Small Business Administration, and 
     to the Small Business Committee of the United States Senate 
     and to the Small Business Committee of the United States 
     House of Representatives.''.

     SEC. 603. MEMBERSHIP OF THE COUNCIL.

       Section 403 of the Women's Business Ownership Act of 1988 
     (15 U.S.C. 631 note) is redesignated as section 407 of such 
     Act, and, as redesignated, is amended to read as follows:

     ``SEC. 407. MEMBERSHIP OF THE COUNCIL.

       ``(a) The Council shall be composed of 15 members who shall 
     be appointed by the Administrator of the Small Business 
     Administration and who shall serve at the Administrator's 
     discretion. In making the appointments, the Administrator 
     shall include racial, geographic and economic diversity, and 
     representation from diverse sectors of the economy, including 
     manufacturing, high technology, services and credit 
     institutions, and shall give priority to include 
     representation of major women's business organizations.
       ``(b) Only the owner, operator or employee of a woman-owned 
     business shall be eligible for appointment, and not more than 
     eight appointees shall be members of the same political 
     party. If any member of the Council subsequently becomes an 
     officer or employee of the Federal Government or of the 
     Congress, such individual may continue as a member of the 
     Council for not longer than the thirty-day period beginning 
     on the date such individual becomes such an officer or 
     employee.
       ``(c) The Council annually shall select one member to serve 
     as its Chairperson. The Chairperson of the Council, or her 
     designee, shall be the representative of the Council to all 
     meetings of the Interagency Committee on Women's Business 
     Enterprise.
       ``(d) The Council shall meet not less than four times per 
     year. Meetings shall be at the call of the Chairperson at 
     such times as she deems appropriate.
       ``(e) Members of the Council shall serve without pay for 
     such membership, except they shall be entitled to 
     reimbursement for travel, subsistence, and other necessary 
     expenses incurred by them in carrying out the functions of 
     the Council, in the same manner as persons serving on 
     advisory boards pursuant to section 8(b) of the Small 
     Business Act.''.

     SEC. 604. INTERAGENCY COMMITTEE.

       Title IV of the Women's Business Ownership Act of 1988 (15 
     U.S.C. 631 note) is amended by striking section 404 and by 
     inserting the following new sections prior to section 405 as 
     redesignated by section 601 of this Act:

     ``SEC. 401. ESTABLISHMENT OF THE COMMITTEE.

       ``There is established an Interagency Committee to be known 
     as the `Interagency Committee on Women's Business Enterprise' 
     (hereinafter in this title referred to as the Committee).

     ``SEC. 402. DUTIES OF THE COMMITTEE.

       ``The Committee shall--
       ``(1) promote, coordinate and monitor the plans, programs 
     and operations of the departments and agencies of the Federal 
     Government which may contribute to the establishment, 
     preservation and strengthening of women's business 
     enterprise. It may, as appropriate, develop comprehensive 
     interagency plans and specific program goals for women's 
     business enterprise with the cooperation of Federal 
     departments and agencies;
       ``(2) promote the better utilization of the activities and 
     resources of State and local governments, business and trade 
     associations, private industry, colleges and universities, 
     foundations, professional organizations, and volunteer and 
     women's business enterprise, and facilitate the coordination 
     of the efforts of these groups with those of Federal 
     departments and agencies;
       ``(3) consult with the Council to develop and promote new 
     initiatives designed to foster women's business enterprise, 
     and to develop policies, programs, and plans intended to 
     promote such development;
       ``(4) consider the Council's recommendations and public and 
     private sector studies of the problems of women 
     entrepreneurs, and promote further research into such 
     problems; and
       ``(5) design a comprehensive plan for a joint public-
     private sector effort to facilitate the development and 
     growth of women-owned businesses. The Committee should submit 
     the plan to the President for review within six months of the 
     effective date of this Act.

     ``SEC. 403. MEMBERSHIP OF THE COMMITTEE.

       ``(a) The Committee shall be composed of representatives of 
     the following departments and agencies: The Departments of 
     Agriculture, Commerce, Defense, Energy, Health and Human 
     Services, Education, Housing and Urban Development, Interior, 
     Justice, Labor, Transportation, Treasury, the Federal Trade 
     Commission, General Services Administration, National Science 
     Foundation, Office of Federal Procurement Policy, and the 
     Director of the Office of Women's Business Ownership of the 
     Small Business Administration, who shall serve as Vice 
     Chairperson of the Committee. The head of each such 
     department and agency shall designate a representative who 
     shall be a policy making official within the department or 
     agency.
       ``(b) The Committee shall have a Chairperson appointed by 
     the President, after consultation with the Administrator of 
     the Small Business Administration and the Chief Counsel for 
     Advocacy of the Small Business Administration. The 
     Chairperson shall be the head of a Federal department or 
     agency. If the Chairperson is the head of one of the 
     departments or agencies enumerated in subsection (a), he or 
     she shall also serve as the representative of such department 
     or agency.
       ``(c) The Committee shall meet not less than four times per 
     year. Meetings shall be at the call of the Chairperson at 
     such times as he or she deems appropriate.
       ``(d) The members of the Committee shall serve without 
     additional pay for such membership.
       ``(e) The Chairperson of the Committee may designate a 
     Director of the Committee, after consultation with the 
     Administrator of the Small Business Administration and the 
     Chief Counsel for Advocacy of the Small Business 
     Administration.
       ``(f) The Chief Counsel for Advocacy is authorized to 
     appoint to his staff under the provisions of section 204 of 
     Public Law 94-305 (15 U.S.C. 634(d)) the person so designated 
     under subsection (e). He or she is also authorized to provide 
     additional staff and administrative support for the 
     Committee.
       ``(g) The Director of the Office of Women's Business 
     Ownership of the Small Business Administration is authorized 
     to provide additional staff and administrative support for 
     the Committee.

     ``SEC. 404. REPORTS FROM THE COMMITTEE.

       ``The Committee shall transmit to the President and to the 
     Small Business Committee of the United States Senate and to 
     the Small Business Committee of the United States House of 
     Representatives a report no less than once in every twelve-
     month period. The first such report shall be submitted no 
     later than March 31, 1995. Such reports shall contain any 
     recommendations from the Council and any comments of the 
     Committee thereon, a detailed statement on the activities of 
     the Committee, the findings and conclusions of the Committee, 
     together with its recommendations for such legislation and 
     administrative actions as it considers appropriate to promote 
     the development of small business concerns owned and 
     controlled by women.''.

     SEC. 605. REPEALER.

       Sections 404 through 407 of the Women's Business Ownership 
     Act of 1988, as in effect on the day before the date of the 
     enactment of this Act, are repealed and the following new 
     section is added at the end of title IV of such Act:

     ``SEC. 408. DEFINITIONS.

       ``For the purposes of this Act, the term--
       ``(1) `woman-owned business' shall mean a small business 
     which is at least 51 percent owned by a woman or women who 
     also control and operate it;
       ``(2) `control' shall mean exercising the power to make 
     policy decisions;
       ``(3) `operate' shall mean being actively involved in the 
     day-to-day management; and
       ``(4) `women's business enterprise' shall mean a woman-
     owned business or businesses or the efforts of a woman or 
     women to establish, maintain, or develop such a business or 
     businesses.''.

     SEC. 606. EXTENSION OF AUTHORITY FOR DEMONSTRATION PROJECTS.

       Section 28 of the Small Business Act, as added by section 2 
     of Public Law 102-191, is redesignated as section 29 and, as 
     so redesignated, is amended by striking from subsection (g) 
     ``1995'' and by inserting ``1997''.

     SEC. 607. ESTABLISHMENT OF OFFICE OF WOMEN'S BUSINESS 
                   OWNERSHIP.

       Section 29 of the Small Business Act, as redesignated by 
     section 606 of this Act, is amended by adding the following 
     new subsection at the end:
       ``(h) There is established within the Administration an 
     Office of Women's Business Ownership, which shall be 
     responsible for the administration of the Administration's 
     programs for the development of women's business enterprises 
     as defined in section 408 of the Women's Business Ownership 
     Act of 1988. The Office shall be headed by a director who 
     shall be appointed by the Administrator.''.

     SEC. 608. TECHNICAL AND CONFORMING AMENDMENTS.

       (a) Title IV of the table of contents of the Women's 
     Business Ownership Act of 1988 (15 U.S.C. 631 note) is 
     amended to read as follows:

         ``TITLE IV--DEVELOPMENT OF WOMEN'S BUSINESS ENTERPRISE

``Sec. 401. Establishment of the Committee.
``Sec. 402. Duties of the Committee.
``Sec. 403. Membership of the Committee.
``Sec. 404. Reports from the Committee.
``Sec. 405. Establishment of the Council.
``Sec. 406. Duties of the Council.
``Sec. 407. Membership of the Council.
``Sec. 408. Definitions.''.

       (b) The heading to title IV of the Women's Business 
     Ownership Act of 1988 (15 U.S.C. 631 note) is amended to read 
     as follows:

       ``TITLE IV--DEVELOPMENT OF WOMEN'S BUSINESS ENTERPRISES''.

     SEC. 609. AUTHORIZATION.

       There is authorized to be appropriated $200,000 in each of 
     fiscal years 1995 through 1997 to carry out the provisions of 
     title IV of the Women's Business Ownership Act of 1988 (15 
     U.S.C. 631 note).
                  TITLE VII--MISCELLANEOUS AMENDMENTS

     SEC. 701. HANDICAPPED PARTICIPATION IN SMALL BUSINESS SET 
                   ASIDE CONTRACTS.

       Section 15(c) of the Small Business Act (15 U.S.C. 644(c)) 
     is amended--
       (1) by amending paragraph (2)(A) to read as follows:
       ``(2)(A) During each fiscal year, public or private 
     organizations for the handicapped shall be eligible to 
     participate in programs authorized under this section in an 
     aggregate amount not to exceed $50,000,000.''; and
       (2) by adding the following new paragraph at the end 
     thereof:
       ``(7) Any contract awarded to such an organization pursuant 
     to the provisions of this subsection may be extended for up 
     to two additional years.''.

     SEC. 702. SBA INTEREST PAYMENTS TO TREASURY.

       Section 4(c)(5)(B)(ii) of the Small Business Act (15 U.S.C. 
     633(c)(5)(B)(ii)) is amended to read as follows:
       ``(ii) The Administration shall pay into the miscellaneous 
     receipts of the Treasury following the close of each fiscal 
     year the actual interest it collects during that fiscal year 
     on all financings made under the authority of this Act.''.

     SEC. 703. IMPOSITION OF FEES.

       Section 5(b) of the Small Business Act (15 U.S.C. 634(b)) 
     is amended--
       (1) in paragraph (10) by striking ``and'' at the end;
       (2) in paragraph (11) by striking the period at the end and 
     inserting a semicolon; and
       (3) by adding the following new paragraphs at the end:
       ``(12) impose, retain and use only those fees which are 
     specifically authorized by law or which are in effect on 
     September 30, 1994, and in the amounts and at the rates in 
     effect on such date. The administrator is authorized to 
     impose, retain and utilize, subject to approval in 
     appropriations Acts, the following additional fees--
       ``(A) not to exceed $100 for each loan servicing action 
     requested after disbursement of the loan, including 
     substitution of collateral, loan assumptions, release or 
     substitution of guarantors, reamortizations or similar 
     actions;
       ``(B) to recover the direct, incremental cost involved in 
     the production and dissemination of compilations of 
     information produced by the Administration under the 
     authority of the Small Business Act and the Small Business 
     Investment Act of 1958; and
       ``(13) to collect, retain and utilize, subject to approval 
     in appropriations Acts, any amounts collected by fiscal 
     transfer agents and not used by such agent as payment of the 
     cost of loan pooling or debenture servicing operations: 
     Provided, That any monies so collected shall be utilized 
     solely to facilitate the administration of the program which 
     generated the excess monies.''.

     SEC. 704. SBIR VENDORS.

       Section 9(q)(2) of the Small Business Act (15 U.S.C. 
     638(q)(2)) is amended to read as follows:
       ``(2) Vendor selection.--Each agency may select a vendor to 
     assist small business concerns to meet the goals listed in 
     paragraph (1). Such selection shall be competitive using 
     merit-based criteria, for a term not to exceed 3 years.''.

     SEC. 705. MANUFACTURING CONTRACTS.

       (a) Establishment of Pilot Program.--Section 15 of the 
     Small Business Act (15 U.S.C. 644) is amended by adding at 
     the end the following:
       ``(p) Manufacturing Modernization Pilot Program.--
       ``(1) Establishment.--The Administrator may establish and 
     carry out a manufacturing modernization pilot program 
     (hereinafter in this section referred to as the `program') 
     for the purpose of promoting the award of Federal procurement 
     contracts to small business concerns that participate in 
     manufacturing application and education centers that are 
     established or certified pursuant to paragraph (2).
       ``(2) Manufacturing application and education centers.--The 
     Administrator may establish manufacturing application and 
     education centers which will provide training to small 
     business concerns on new and innovative manufacturing 
     practices in a shared-use production environment and which 
     will assist such concerns in carrying out Federal procurement 
     contracts for the manufacture of components and subsystems. 
     The Administrator may also certify existing manufacturing 
     application and education centers for participation in the 
     program.
       ``(3) Use of private centers as examples.--In establishing 
     any manufacturing application and education centers pursuant 
     to paragraph (2), the Administrator may use as examples 
     manufacturing application and education centers in the 
     private sector that provide the following services: 
     technology demonstration, technology education, technology 
     application support, technology advancement support, and 
     technology awareness.
       ``(4) Identification of contracts.--The Administrator and 
     the head of a contracting agency may identify for additional 
     small business set-asides pursuant to subsection (a) any 
     procurement, and in particular any procurement which is being 
     foreign-sourced or is considered critical, which is 
     susceptible to performance by a small business concern if the 
     concern is assisted by a manufacturing application and 
     education center under the program. Any such procurement 
     shall be subject to the requirements of subsection (a), 
     including requirements relating to any failure of the 
     Administrator and the head of the contracting agency to agree 
     on procurement methods.
       ``(5) Nonapplicability of performance requirement.--The 
     requirement of subsection (o)(1)(B) shall not apply with 
     respect to any contract carried out by a small business 
     concern under the program with the assistance of a 
     manufacturing application and education center.
       ``(6) Regulations.--Not later than 6 months after the date 
     of the enactment of this subsection, the Administrator shall 
     issue regulations to carry out this subsection if he 
     determines it appropriate to carry out the program authorized 
     by this subsection.
       ``(7) Reports.--
       ``(A) Progress report.--Not later than 3 months after the 
     last day of the fiscal year in which final regulations are 
     issued pursuant to paragraph (6), the Administrator shall 
     transmit to the Committees on Small Business of the House of 
     Representatives and the Senate a report on the progress of 
     the program.
       ``(B) Final report.--If the Administrator establishes the 
     program authorized herein, not later than March 31, 1999, he 
     shall transmit to the Committees on Small Business of the 
     House of Representatives and the Senate a report on the 
     success of the program in--
       ``(i) enabling deployment of technology to small business 
     concerns participating in the program, and
       ``(ii) assisting manufacturing application and education 
     centers in achieving self-sufficiency,
     together with recommendations concerning continuation, 
     modification, or discontinuance of the program.
       ``(8) Program term.--The Administrator may carry out the 
     program during the period beginning on the date of issuance 
     of final regulations under paragraph (5) and ending on 
     September 30, 1999.
       ``(9) Authorization of appropriations.--There are 
     authorized to be appropriated such sums as may be necessary 
     to carry out this subsection.''.

     SEC. 706. DENIAL OF USE OF FUNDS FOR INDIVIDUALS NOT LAWFULLY 
                   WITHIN THE UNITED STATES.

       The Small Business Act (15 U.S.C. 631 et seq.) is amended 
     by inserting after section 30, as added by section 304 of 
     this Act, the following:

     ``SEC. 31. DENIAL OF USE OF FUNDS FOR INDIVIDUALS NOT 
                   LAWFULLY WITHIN THE UNITED STATES.

       ``None of the funds made available pursuant to this Act may 
     be used to provide any direct benefit or assistance to any 
     individual in the United States when it is made known to the 
     Administrator of the Small Business Administration or the 
     official to which the funds are made available that the 
     individual is not lawfully within the United States.''.

     SEC. 707. OFFICE OF ADVOCACY EMPLOYEES.

       Section 204 of Public Law 94-305 (15 U.S.C. 634d) is 
     amended as follows--
       (1) by striking ``after consultation with and subject to 
     the approval of the Administrator,''; and
       (2) in paragraph (1) by striking ``GS-15 of the General 
     Schedule'' and all that follows and inserting ``GS-15 of the 
     General Schedule: Provided, however, That not more than 14 
     staff personnel at any one time may be employed and 
     compensated at a rate in excess of GS-15, step 10, of the 
     General Schedule;''. 

     SEC. 708. ADVOCACY STUDY OF PAPERWORK AND TAX IMPACT.

       The Chief Counsel for Advocacy of the Small Business 
     Administration shall conduct a study of the impact of all 
     Federal regulatory paperwork and tax requirements upon small 
     business and report its findings to the Congress within 1 
     year of the date of the enactment of this Act.

     SEC. 709. CERTIFICATION OF COMPLIANCE WITH CHILD SUPPORT 
                   OBLIGATIONS.

       The Small Business Act (15 U.S.C. 631 et seq.) is amended 
     by inserting after section 31, as added by section 706 of 
     this Act, the following:

     ``SEC. 32. CERTIFICATION OF COMPLIANCE WITH CHILD SUPPORT 
                   OBLIGATIONS.

       ``Each applicant for financial assistance under this Act, 
     including applicants for direct loans and loan guarantees, 
     shall certify, as a condition for receiving such assistance, 
     that the applicant is not in violation of the terms of any 
     administrative order, court order, or repayment agreement 
     entered into between the applicant and the custodial parent 
     or the State agency providing child support enforcement 
     services which requires the applicant to pay child support, 
     as such term is defined by section 462(b) of the Social 
     Security Act.''.
       Amend the title so as to read: ``An Act to amend the Small 
     Business Act, and for other purposes.''.

  Mr. METZENBAUM. Mr. President, I ask unanimous consent that the 
Senate disagree to the House amendments, agree to the request for a 
conference and that the Chair be authorized to appoint conferees.
  There being no objection, the Presiding Officer (Mr. Bryan) appointed 
Mr. Bumpers, Mr. Nunn, and Mr. Pressler conferees on the part of the 
Senate.

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