[Congressional Record Volume 140, Number 141 (Monday, October 3, 1994)]
[House]
[Page H]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]


[Congressional Record: October 3, 1994]
From the Congressional Record Online via GPO Access [wais.access.gpo.gov]

 
                      CONFERENCE REPORT ON S. 2060

  Mr. LaFALCE submitted the following conference report and statement 
on the bill (S. 2060), to amend the Small Business Act and the Small 
Business Investment Act of 1958, and for other purposes:

                  Conference Report (H. Rept. 103-824)

       The committee of conference on the disagreeing votes of the 
     two Houses on the amendments of the House to the bill (S. 
     2060), to amend the Small Business Act and the Small Business 
     Investment Act of 1958, and for other purposes, having met, 
     after full and free conference, have agreed to recommend and 
     do recommend to their respective Houses as follows:
       That the Senate recede from its disagreement to the 
     amendment of the House to the text of the bill and agree to 
     the same with an amendment as follows:
       In lieu of the matter proposed to be inserted by the House 
     amendment, insert the following:

     SECTION 1. SHORT TITLE; TABLE OF CONTENTS.

       (a) Short Title.--This Act may be cited as the ``Small 
     Business Administration Reauthorization and Amendments Act of 
     1994''.
       (b) Table of Contents.--The table of contents for this Act 
     is as follows:

Sec. 1. Short title; table of contents.

                        TITLE I--AUTHORIZATIONS

Sec. 101. Authorizations.

                TITLE II--FINANCIAL ASSISTANCE PROGRAMS

Sec. 201. Microloan financing pilot.
Sec. 202. Eligibility of Native American Tribal Governments to be 
              microloan intermediaries.
Sec. 203. Microloan program extension.
Sec. 204. Microloan program funding and State limitations.
Sec. 205. Distribution of intermediaries.
Sec. 206. Microloan intermediary loan limitation.
Sec. 207. Microloan technical assistance to nonborrowers.
Sec. 208. Microloan technical assistance grants for intermediaries 
              serving economically distressed areas.
Sec. 209. Loans to exporters.
Sec. 210. Working capital international trade loans.
Sec. 211. Guarantees on international trade loans.
Sec. 212. Accredited lenders program.
Sec. 213. Interest rate on certified development company loans.
Sec. 214. Certifications of eligibility for SBIC and SSBIC financing.
Sec. 215. Participating securities for smaller SBICs.
Sec. 216. Report on SBIC program.
Sec. 217. Premier Certified Lenders Program.

             TITLE III--SIZE STANDARDS AND BOND GUARANTEES

Sec. 301. Establishment of size standards.
Sec. 302. Pilot preferred surety bond guarantee program extension.
Sec. 303. Manufacturing contracts through manufacturing application and 
              education centers.
Sec. 304. Pilot program for very small business concerns.
Sec. 305. Handicapped workshop participation in small business set 
              aside contracts.

               TITLE IV--BUSINESS DEVELOPMENT ASSISTANCE

                     Subtitle A--General Provisions

Sec. 401. Sunset on cosponsored training.
Sec. 402. Small business development center program level.
Sec. 403. Federal contracts with small business development centers.
Sec. 404. Small business development center program examination and 
              certification.
Sec. 405. Central European small business development.
Sec. 406. Mobile resource center pilot program.
Sec. 407. Information concerning franchising.

           Subtitle B--Development of Woman-Owned Businesses

Sec. 411. Extension of authority for demonstration projects.
Sec. 412. Establishment of Office of Women's Business Ownership.
Sec. 413. Development of women's business enterprise.
Sec. 414. Transition reimbursement.
Sec. 415. Gift authority.
Sec. 416. Conforming amendment.

          TITLE V--RELIEF FROM DEBENTURE PREPAYMENT PENALTIES

Sec. 501. Short title.
Sec. 502. Intention of Congress.
Sec. 503. Prepayment of development company debentures.

                   TITLE VI--MISCELLANEOUS AMENDMENTS

Sec. 601. SBA interest payments to Treasury.
Sec. 602. Imposition of fees.
Sec. 603. Job creation and community benefit.
Sec. 604. Microloan program amendments.
Sec. 605. Technical clarification.
Sec. 606. Study and data base: guaranteed business loan program and 
              development company program.
Sec. 607. SBIR vendors.
Sec. 608. Program extension.
Sec. 609. Prohibition on the use of funds for individuals not lawfully 
              within the United States.
Sec. 610. Office of Advocacy employees.
Sec. 611. Prohibition on the provision of assistance.
Sec. 612. Certification of compliance with child support obligations.
Sec. 613. Advocacy study of paperwork and tax impact.
                        TITLE I--AUTHORIZATIONS

     SEC. 101. AUTHORIZATIONS.

       Section 20 of the Small Business Act (15 U.S.C. 631 note) 
     is amended by striking subsections (k) (as added by section 
     405(3) of the Small Business Credit and Business Opportunity 
     Enhancement Act of 1992) through (p) and inserting 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--
       ``(A) $45,000,000 in technical assistance grants as 
     provided in section 7(m); and
       ``(B) $130,000,000 in direct and immediate participation 
     loans, and of such sum, the Administration is authorized to 
     make--
       ``(i) not more than $10,000,000 in loans, as provided in 
     section 7(a)(10); and
       ``(ii) not more than $120,000,000 in loans, as provided in 
     section 7(m).
       ``(2) For the programs authorized by this Act, the 
     Administration is authorized to make $13,420,000,000 in 
     deferred participation loans and other financings. Of such 
     sum, the Administration is authorized to make--
       ``(A) $9,150,000,000 in general business loans as provided 
     in section 7(a);
       ``(B) $2,250,000,000 in financings as provided in section 
     7(a)(13) and section 504 of the Small Business Investment Act 
     of 1958;
       ``(C) $2,000,000,000 in loans as provided in section 
     7(a)(21); and
       ``(D) $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) The Administration is authorized to make grants or 
     enter into cooperative agreements--
       ``(A) for the Service Corps of Retired Executives program 
     authorized by section 8(b)(1), $3,500,000;
       ``(B) for the Small Business Institute program authorized 
     by section 8(b)(1), $3,000,000; and
       ``(C) for activities of small business development centers 
     pursuant to section 21(c)(3)(G), $5,000,000, to remain 
     available until expended.
       ``(m)(1) 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.
       ``(2) Notwithstanding paragraph (1), for fiscal year 1995--
       ``(A) no funds are authorized to be provided to carry out 
     the loan program authorized by section 7(a)(21) except by 
     transfer from another Federal department or agency to the 
     Administration, unless the program level authorized for 
     general business loans under subsection (l)(2)(A) is fully 
     funded; and
       ``(B) the Administration may not approve loans on behalf of 
     the Administration or on behalf of any other department or 
     agency, by contract or otherwise, under terms and conditions 
     other than those specifically authorized under this Act or 
     the Small Business Investment Act of 1958, except that it may 
     approve loans under section 7(a)(21) of this Act in gross 
     amounts of not more than $1,250,000,000.
       ``(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--
       ``(A) $65,000,000 in technical assistance grants as 
     provided in section 7(m); and
       ``(B) $191,000,000 in direct and immediate participation 
     loans, and of such sum, the Administration is authorized to 
     make--
       ``(i) $11,000,000 in loans, as provided in section 
     7(a)(10); and
       ``(ii) $180,000,000 in loans, as provided in section 7(m).
       ``(2) For the programs authorized by this Act, the 
     Administration is authorized to make $15,680,000,000 in 
     deferred participation loans and other financings. Of such 
     sum, the Administration is authorized to make--
       ``(A) $10,500,000,000 in general business loans as provided 
     in section 7(a);
       ``(B) $2,650,000,000 in financings as provided in section 
     7(a)(13) and section 504 of the Small Business Investment Act 
     of 1958;
       ``(C) $2,500,000,000 in loans as provided in section 
     7(a)(21); and
       ``(D) $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 
     $1,900,000,000, of which not more than $625,000,000 may be in 
     bonds approved pursuant to the provisions of section 
     411(a)(3) of such Act.
       ``(5) The Administration is authorized to make grants or 
     enter cooperative agreements--
       ``(A) for the Service Corps of Retired Executives program 
     authorized by section 8(b)(1), $3,700,000;
       ``(B) for the Small Business Institute program authorized 
     by section 8(b)(1), $3,200,000; and
       ``(C) for activities of small business development centers 
     pursuant to section 21(c)(3)(G), not to exceed $10,000,000, 
     to remain available until expended.
       ``(o)(1) 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.
       ``(2) Notwithstanding paragraph (1), for fiscal year 1996--
       ``(A) no funds are authorized to be provided to carry out 
     the loan program authorized by section 7(a)(21) except by 
     transfer from another Federal department or agency to the 
     Administration, unless the program level authorized for 
     general business loans under subsection (n)(2)(A) is fully 
     funded; and
       ``(B) the Administration may not approve loans on behalf of 
     the Administration or on behalf of any other department or 
     agency, by contract or otherwise, under terms and conditions 
     other than those specifically authorized under this Act or 
     the Small Business Investment Act of 1958, except that it may 
     approve loans under section 7(a)(21) of this Act in gross 
     amounts of not more than $1,250,000,000.
       ``(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--
       ``(A) $98,000,000 in technical assistance grants as 
     provided in section 7(m); and
       ``(B) $262,000,000 in direct and immediate participation 
     loans, and of such sum, the Administration is authorized to 
     make--
       ``(i) $12,000,000 in loans, as provided in section 
     7(a)(10); and
       ``(ii) $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 $19,390,000,000 in 
     deferred participation loans and other financings. Of such 
     sum, the Administration is authorized to make--
       ``(A) $13,100,000,000 in general business loans as provided 
     in section 7(a);
       ``(B) $3,250,000,000 in financings as provided in section 
     7(a)(13) and section 504 of the Small Business Investment Act 
     of 1958;
       ``(C) $3,000,000,000 in loans as provided in section 
     7(a)(21); and
       ``(D) $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 
     $2,000,000,000, of which not more than $650,000,000 may be in 
     bonds approved pursuant to the provisions of section 
     411(a)(3) of such Act.
       ``(5) The Administration is authorized to make grants or 
     enter cooperative agreements--
       ``(A) for the Service Corps of Retired Executives program 
     authorized by section 8(b)(1), $3,900,000;
       ``(B) for the Small Business Institute program authorized 
     by section 8(b)(1), $3,400,000; and
       ``(C) for activities of small business development centers 
     pursuant to section 21(c)(3)(G), not to exceed $15,000,000, 
     to remain available until expended.
       ``(q)(1) 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.
       ``(2) Notwithstanding paragraph (1), for fiscal year 1997--
       ``(A) no funds are authorized to be provided to carry out 
     the loan program authorized by section 7(a)(21) except by 
     transfer from another Federal department or agency to the 
     Administration, unless the program level authorized for 
     general business loans under subsection (p)(2)(A) is fully 
     funded; and
       ``(B) the Administration may not approve loans on behalf of 
     the Administration or on behalf of any other department or 
     agency, by contract or otherwise, under terms and conditions 
     other than those specifically authorized under this Act or 
     the Small Business Investment Act of 1958, except that it may 
     approve loans under section 7(a)(21) of this Act in gross 
     amounts of not more than $1,250,000,000.''.
                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 at the end the following new paragraph:
       ``(12) Deferred participation loan pilot.--In lieu of 
     making direct loans to intermediaries as authorized in 
     paragraph (1)(B), during fiscal years 1995 through 1997, the 
     Administration may, on a pilot program basis, participate on 
     a deferred basis of not less than 90 percent and not more 
     than 100 percent on loans made to intermediaries by a for-
     profit or nonprofit entity or by alliances of such entities, 
     subject to the following conditions:
       ``(A) Number of loans.--In carrying out this paragraph, the 
     Administration shall not participate in providing financing 
     on a deferred basis to more than 10 intermediaries in urban 
     areas or more than 10 intermediaries in rural areas.
       ``(B) Term of loans.--The term of each loan shall be 10 
     years. During the first year of the loan, the intermediary 
     shall not be required to repay any interest or principal. 
     During the second through fifth years of the loan, the 
     intermediary shall be required to pay interest only. During 
     the sixth through tenth years of the loan, the intermediary 
     shall be required to make interest payments and fully 
     amortize the principal.
       ``(C) Interest rate.--The interest rate on each loan shall 
     be the rate specified by paragraph (3)(F) for direct 
     loans.''.

     SEC. 202. ELIGIBILITY OF NATIVE AMERICAN TRIBAL GOVERNMENTS 
                   TO BE MICROLOAN INTERMEDIARIES.

       Section 7(m)(11)(A) of the Small Business Act (15 U.S.C. 
     636(m)(11)(A)) is amended--
       (1) in clause (iii), by striking ``or'' at the end;
       (2) in clause (iv), by striking the comma at the end and 
     inserting ``; or''; and
       (3) by adding at the end the following new clause:
       ``(v) an agency of or nonprofit entity established by a 
     Native American Tribal Government,''.

     SEC. 203. MICROLOAN PROGRAM EXTENSION.

       Section 609(j) of Public Law 102-140 (105 Stat. 831) is 
     amended by striking ``5 years after the date of enactment of 
     this Act'', and inserting ``on October 1, 1997''.

     SEC. 204. MICROLOAN PROGRAM FUNDING AND STATE LIMITATIONS.

       Section 7(m)(7) of the Small Business Act (15 U.S.C. 
     636(m)(7)) is amended to read as follows:
       ``(7) Program funding for microloans.--
       ``(A) Number of participants.--During the demonstration 
     program authorized by this subsection, the Administration may 
     fund, on a competitive basis, not more than 200 microloan 
     programs.
       ``(B) State limitations.--During any fiscal year, a State 
     shall not receive new loan funds from the Administration that 
     exceed 125 percent of the State's pro rata share of the 
     microloan program authorization during such fiscal year, such 
     share to be based on the population of the State, as compared 
     to the total population of the United States.''.

     SEC. 205. DISTRIBUTION OF INTERMEDIARIES.

       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 under this subsection, 
     the Administration shall select such intermediaries as will 
     ensure appropriate availability of loans for small businesses 
     in all industries located throughout each State, particularly 
     those located in urban and in rural areas.''.

     SEC. 206. MICROLOAN INTERMEDIARY LOAN LIMITATION.

       Section 7(m)(3)(C) of the Small Business Act (15 U.S.C. 
     636(m)(3)(C)) is amended by striking ``$1,250,000'' and 
     inserting ``$2, 500,000''.

     SEC. 207. MICROLOAN TECHNICAL ASSISTANCE TO NONBORROWERS.

       Section 7(m)(4) of the Small Business Act (15 U.S.C. 
     636(m)(4)) is amended by adding at the end the following new 
     subparagraph:
       ``(E) Assistance to certain small business concerns.--Each 
     intermediary may expend an amount not to exceed 15 percent of 
     the grant funds received under paragraph (1)(B)(ii) to 
     provide information and technical assistance to small 
     business concerns that are prospective borrowers under this 
     subsection.''.

     SEC. 208. MICROLOAN TECHNICAL ASSISTANCE GRANTS FOR 
                   INTERMEDIARIES SERVING ECONOMICALLY DISTRESSED 
                   AREAS.

       (a) Grant Eligibility.--Section 7(m)(4) of the Small 
     Business Act (15 U.S.C. 636(m)(4)) is amended--
       (1) in subparagraph (B), by inserting ``except for a grant 
     made to an intermediary that provides not less than 50 
     percent of its loans to small business concerns located in or 
     owned by one or more residents of an economically distressed 
     area,'' after ``under subparagraph (A),''; and
       (2) in subparagraph (C), by striking clause (i) and 
     inserting the following:
       ``(i) In general.--In addition to grants made under 
     subparagraph (A), each intermediary shall be eligible to 
     receive a grant equal to 5 percent of the total outstanding 
     balance of loans made to the intermediary under this 
     subsection if--

       ``(I) the intermediary provides not less than 25 percent of 
     its loans to small business concerns located in or owned by 
     one or more residents of an economically distressed area; or
       ``(II) the intermediary has a portfolio of loans made under 
     this subsection that averages not more than $7,500 during the 
     period of the intermediary's participation in the program.''.

       (b) Definition.--Section 7(m)(11) of the Small Business Act 
     (15 U.S.C. 636(m)(11)) is amended--
       (1) in subparagraph (C), by striking the period at the end 
     and inserting ``; and''; and
       (2) by adding at the end the following new subparagraph:
       ``(D) the term `economically distressed area', as used in 
     paragraph (4), means a county or equivalent division of local 
     government of a State in which the small business concern is 
     located, in which, according to the most recent data 
     available from the Bureau of the Census, Department of 
     Commerce, not less than 40 percent of residents have an 
     annual income that is at or below the poverty level.''.
       (c) Termination.--The amendments made by this section shall 
     remain in effect during the period beginning on the date of 
     enactment of this Act and ending on October 1, 1997.

     SEC. 209. 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:
       ``(14)(A) The Administration may provide extensions of 
     credit, 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. 210. 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. 211. 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 (16).''.

     SEC. 212. ACCREDITED LENDERS PROGRAM.

       (a) Establishment.--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) Establishment.--The Administration is authorized to 
     establish an Accredited Lenders Program for qualified State 
     and local development companies that meet the requirements of 
     subsection (b).
       ``(b) Requirements.--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 authorized by sections 502, 503, and 504 for 
     not less than the preceding 12 months;
       ``(2) has well-trained, qualified personnel who are 
     knowledgeable in the Administration's lending policies and 
     procedures for such Development Company Program;
       ``(3) has the ability to process, close, and service 
     financing for plant and equipment under such Development 
     Company Program;
       ``(4) has a loss rate on the company's debentures that is 
     reasonable and 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 through the 
     Development Company Program.
       ``(c) Expedited Processing of Loan Applications.--The 
     Administration shall develop an expedited procedure for 
     processing 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) Suspension or Revocation of Designation.--
       ``(1) In general.--The designation of a qualified State or 
     local development company as an accredited lender may be 
     suspended or revoked if the Administration determines that--
       ``(A) the development company has not continued to meet the 
     criteria for eligibility under subsection (b); or
       ``(B) the development company has failed to adhere to the 
     Administration's rules and regulations or is violating any 
     other applicable provision of law.
       ``(2) Effect.--A suspension or revocation under paragraph 
     (1) shall not affect any outstanding debenture guarantee.
       ``(e) Definition.--For purposes of this section, the term 
     `qualified State or local development company' has the same 
     meaning as in section 503(e).''.
       (b) Regulations.--Not later than 120 days after the date of 
     enactment of this Act, the Administration shall promulgate 
     final regulations to carry out this section.
       (c) Report.--Not later than 1 year after the effective date 
     of regulations promulgated under subsection (b), and 
     biennially thereafter, the Administration shall report to the 
     Committees on Small Business of the Senate and the House of 
     Representatives on the implementation of this section. Such 
     report shall include data on the number of development 
     companies designated as accredited lenders, their debenture 
     guarantee volume, their loss rates, the average processing 
     time on their guarantee applications, and such other 
     information as the Administration deems appropriate.

     SEC. 213. INTEREST RATE ON CERTIFIED DEVELOPMENT COMPANY 
                   LOANS.

       Section 112(c) of the Small Business Administration 
     Reauthorization and Amendment Act of 1988 (102 Stat. 2996) is 
     amended--
       (1) in paragraph (1), by striking ``(1) In General.--
     Section 503'' and inserting ``Section 503''; and
       (2) by striking paragraph (2).

     SEC. 214. CERTIFICATIONS OF ELIGIBILITY FOR SBIC AND SSBIC 
                   FINANCING.

       Section 308 of the Small Business Investment Act of 1958 
     (15 U.S.C. 687) is amended by adding at the end the following 
     new subsection:
       ``(h) Certifications of Eligibility.--
       ``(1) Certification by small business concern.--Prior to 
     receiving financial assistance from a company licensed 
     pursuant to subsection (c) or (d) of section 301, a small 
     business concern shall certify in writing that it meets the 
     eligibility requirements of the Small Business Investment 
     Company Program or the Specialized Small Business Investment 
     Company Program, as applicable.
       ``(2) Certification by company.--Prior to providing 
     financial assistance to a small business concern under this 
     Act, a company licensed pursuant to subsection (c) or (d) of 
     section 301 shall certify in writing that it has reviewed the 
     application for assistance of the small business concern and 
     that all documentation and other information supports the 
     eligibility of the applicant.
       ``(3) Retention of certifications.--Certificates made 
     pursuant to paragraphs (1) and (2) shall be retained by the 
     company licensed pursuant to subsection (c) or (d) of section 
     301 for the duration of the financial assistance.''.

     SEC. 215. 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 at the end the 
     following new paragraph:
       ``(13) Participating securities for smaller small business 
     investment companies.--
       ``(A) In general.--Subject to the provisions of 
     subparagraph (B), 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 not more than 
     $20,000,000.
       ``(B) Exception.--During the last quarter of each fiscal 
     year, if the Administrator determines that there is a lack of 
     qualified applicants with private capital of not more than 
     $20,000,000, the Administrator may utilize all or any part of 
     the program level for securities reserved under subparagraph 
     (A) for qualified applicants with private capital of more 
     than $20,000,000.''.

     SEC. 216. REPORT ON SBIC PROGRAM.

       Not later than May 15, 1995, the Small Business 
     Administration shall submit to the Committees on Small 
     Business of the House of Representatives and the Senate a 
     comprehensive report on--
       (1) the status and disposition of all small business 
     investment companies participating in the Small Business 
     Investment Company Program under subsections (c) and (d) of 
     section 301 of the Small Business Investment Act of 1958, 
     whether active or in liquidation;
       (2) a complete accounting of the assets in and the basis of 
     the portfolios of such companies;
       (3) the projected and actual loss rates for all portfolios 
     in liquidation or active; and
       (4) a detailed accounting of valuation of the Small 
     Business Investment Company Program's investments.

     SEC. 217. PREMIER CERTIFIED LENDERS PROGRAM.

       (a) In General.--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. 508. PREMIER CERTIFIED LENDERS PROGRAM.

       ``(a) Establishment.--On a pilot program basis, the 
     Administration may establish a Premier Certified Lenders 
     Program for not more than 15 certified development companies 
     that meet the requirements of subsection (b).
       ``(b) Requirements.--
       ``(1) Application.--To be eligible to participate in the 
     Premier Certified Lenders Program established under 
     subsection (a), a certified development company shall prepare 
     and submit to the Administration an application at such time, 
     in such manner, and containing such information as the 
     Administration may require.
       ``(2) Designation.--The Administration may designate a 
     certified development company as a premier certified lender 
     if such company--
       ``(A) has been an active participant in the accredited 
     lenders program during the 12-month period preceding the date 
     on which the company submits an application under paragraph 
     (1), except that, prior to January 1, 1996, the 
     Administration may waive this requirement if the company is 
     qualified to participate in the accredited lenders program;
       ``(B) has a history of submitting to the Administration 
     adequately analyzed debenture guarantee application packages; 
     and
       ``(C) agrees to assume and to reimburse the Administration 
     for 10 percent of any loss sustained by the Administration as 
     a result of default by the company in the payment of 
     principal or interest on a debenture issued by such company 
     and guaranteed by the Administration under this section.
       ``(c) Loss Reserve.--
       ``(1) Establishment.--A company designated as a premier 
     certified lender shall establish a loss reserve for 
     financings approved pursuant to this section.
       ``(2) Amount.--The amount of the loss reserve shall be 
     based upon the greater of--
       ``(A) the historic loss rate on debentures issued by such 
     company; or
       ``(B) 10 percent of the amount of the company's exposure as 
     determined under subsection (b)(2)(C).
       ``(3) Assets.--The loss reserve shall be comprised of 
     segregated assets of the company which shall be securitized 
     in favor of the Administration.
       ``(4) Contributions.--The company shall make contributions 
     to the loss reserve in the following amounts and at the 
     following intervals:
       ``(A) 50 percent when a debenture is closed.
       ``(B) 25 percent not later than 1 year after a debenture is 
     closed.
       ``(C) 25 percent not later than 2 years after a debenture 
     is closed.
       ``(d) Loan Approval Authority.--
       ``(1) In general.--Notwithstanding section 503(b)(6), and 
     subject to such terms and conditions as the Administration 
     may establish, the Administration may permit a company 
     designated as a premier certified lender under this section 
     to approve loans that are funded with the proceeds of a 
     debenture issued by such company and may authorize the 
     guarantee of such debenture.
       ``(2) Scope of review.--The approval of a loan by a premier 
     certified lender shall be subject to final approval as to 
     eligibility of any guarantee by the Administration pursuant 
     to section 503(a), but such final approval shall not include 
     review of decisions by the lender involving creditworthiness, 
     loan closing, or compliance with legal requirements imposed 
     by law or regulation.
       ``(e) Review.--After the issuance and sale of debentures 
     under this section, the Administration, at intervals not 
     greater than 12 months, shall review the financings made by 
     each premier certified lender. The review shall include the 
     lender's credit decisions and general compliance with the 
     eligibility requirements for each financing approved under 
     the program authorized under this section. The Administration 
     shall consider the findings of the review in carrying out its 
     responsibilities under subsection (f), but such review shall 
     not affect any outstanding debenture guarantee.
       ``(f) Suspension or Revocation.--The designation of a State 
     or local development company as a premier certified 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);
       ``(3) is failing to adhere to the Administration's rules 
     and regulations; or
       ``(4) is violating any other applicable provision of law.
       ``(g) Effect of Suspension or Designation.--A suspension or 
     revocation under subsection (f) shall not affect any 
     outstanding debenture guarantee.
       ``(h) Regulations.--Not later than 180 days after the date 
     of enactment of this section, the Administration shall 
     promulgate regulations to carry out this section.
       ``(i) Report.--Not later than 1 year after the date of 
     enactment of this Act, and annually thereafter, the 
     Administration shall report to the Committees on Small 
     Business of the Senate and the House of Representatives on 
     the implementation of this section. Each report shall 
     include--
       ``(1) the number of certified development companies 
     designated as premier certified lenders;
       ``(2) the debenture guarantee volume of such companies;
       ``(3) a comparison of the loss rate for premier certified 
     lenders to the loss rate for accredited and other lenders; 
     and
       ``(4) such other information as the Administration deems 
     appropriate.''.
       (b) Repeal.--Effective on October 1, 1997, section 508 of 
     the Small Business Investment Act of 1958, as added by 
     subsection (a), is repealed.
             TITLE III--SIZE STANDARDS AND BOND GUARANTEES

     SEC. 301. ESTABLISHMENT OF SIZE STANDARDS.

       Section 3(a)(2) of the Small Business Act (15 U.S.C. 
     632(a)(2)) is amended to read as follows:
       ``(2) Establishment of size standards.--
       ``(A) In general.--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.
       ``(B) Additional criteria.--The standards described in 
     paragraph (1) may utilize number of employees, dollar volume 
     of business, net worth, net income, a combination thereof, or 
     other appropriate factors.
       ``(C) Requirements.--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--
       ``(i) is proposed after an opportunity for public notice 
     and comment;
       ``(ii) provides for determining--

       ``(I) the size of a manufacturing concern as measured by 
     the manufacturing concern's average employment based upon 
     employment during each of the manufacturing concern's pay 
     periods for the preceding 12 months;
       ``(II) the size of a business concern providing services on 
     the basis of the annual average gross receipts of the 
     business concern over a period of not less than 3 years;
       ``(III) the size of other business concerns on the basis of 
     data over a period of not less than 3 years; or
       ``(IV) other appropriate factors; and

       ``(iii) is approved by the Administrator.''.

     SEC. 302. PILOT PREFERRED SURETY BOND GUARANTEE PROGRAM 
                   EXTENSION.

       Section 207 of the Small Business Administration 
     Reauthorization and Amendment Act of 1988 (15 U.S.C. 694b 
     note) is amended by striking ``September 30, 1994'' and 
     inserting ``September 30, 1995''.

     SEC. 303. MANUFACTURING CONTRACTS THROUGH MANUFACTURING 
                   APPLICATION AND EDUCATION CENTERS.

       (a) In General.--The Small Business Administration shall 
     promote the award of Federal manufacturing contracts to small 
     business concerns that participate in manufacturing 
     application and education centers by working with the 
     Department of Commerce and other agencies to identify 
     components and subsystems that are both critical and 
     currently foreign-sourced.
       (b) Qualifications.--In order to qualify as a manufacturing 
     application and education center under this section, an 
     entity shall have the capacity to assist small business 
     concerns in a shared-use production environment and to offer 
     the following services:
       (1) Technology demonstration.
       (2) Technology education.
       (3) Technology application support.
       (4) Technology advancement support.
       (c) Inapplicability of Certain Requirements.--The 
     requirements of section 15(o)(1)(B) of the Small Business Act 
     shall not apply with respect to any manufacturing contract 
     carried out by a small business concern in conjunction with a 
     manufacturing application and education center under this 
     section.
       (d) Regulations.--Not later than 180 days after the date of 
     enactment of this Act, the Administrator of the Small 
     Business Administration shall promulgate final regulations to 
     carry out this section.
       (e) Termination of Authority.--The authority of the Small 
     Business Administration under this section shall terminate on 
     September 30, 1997.
       (f) Authorization of Appropriations.--There are authorized 
     to be appropriated to the Small Business Administration, such 
     sums as may be necessary to carry out this section.

     SEC. 304. PILOT PROGRAM FOR VERY SMALL BUSINESS CONCERNS.

       (a) Establishment.--The Administrator shall establish and 
     carry out a pilot program in accordance with the requirements 
     of this section to provide improved access to Federal 
     contract opportunities for very small business concerns.
       (b) Procurement Contracts.--
       (1) In general.--In carrying out subsection (a), the 
     Administrator shall identify procurement contracts of Federal 
     agencies for award under the program.
       (2) Contract awards.--Under the program established 
     pursuant to this section, the award of a procurement contract 
     of a Federal agency identified by the Administration pursuant 
     to paragraph (1) shall be made by the agency to an eligible 
     program participant selected, and determined to be 
     responsible, by the agency.
       (3) Competition.--All contract opportunities offered for 
     award under the program shall be awarded on the basis of 
     competition among eligible very small business concerns.
       (c) Eligibility.--Only a very small business concern shall 
     be eligible to compete for a contract to be awarded under the 
     program. A contracting officer may rely in good faith on a 
     written certification that a small business concern is a very 
     small business concern.
       (d) Delegation of Authority.--The authority of the 
     Administrator under subsections (b)(1) and (c) shall be 
     delegated to not less than 5 and not more than 10 districts 
     of the Administration to promote the award of contracts that 
     can be performed by very small business concerns.
       (e) Financial Assistance.--In order to assist very small 
     business concerns receiving contract awards under the 
     program, the Administrator shall establish a preauthorization 
     program for such concerns for the purpose of receiving 
     financial assistance under section 7(a) of the Small Business 
     Act.
       (f) Attainment of Contract Goals.--All contract awards made 
     under the program shall be counted toward the attainment of 
     the goals specified in section 15(g) of the Small Business 
     Act.
       (g) Regulations.--The Administrator shall--
       (1) issue proposed regulations to carry out this section 
     not later than 180 days after the date of enactment of this 
     Act; and
       (2) issue final regulations to carry out this section not 
     later than 270 days after the date of enactment of this Act.
       (h) Report to Congress.--Not later than April 30, 1997, the 
     Administrator shall transmit to the Congress a report on the 
     results of the program, together with such recommendations as 
     the Administrator deems appropriate.
       (i) Program Term.--Implementation of the program shall 
     begin not later than August 30, 1995. The program authorized 
     by this section shall expire on September 30, 1998.
       (j) Definitions.--For purposes of this section, the 
     following definitions shall apply:
       (1) Administration.--The term ``Administration'' means the 
     Small Business Administration.
       (2) Administrator.--The term ``Administrator'' means the 
     Administrator of the Small Business Administration.
       (3) Program.--The term ``program'' means a program 
     established pursuant to subsection (a).
       (4) Very small business concern.--The term ``very small 
     business concern'' means a small business concern that--
       (A) has not more than 15 employees; and
       (B) has average annual receipts that total not more than 
     $1,000,000.

     SEC. 305. HANDICAPPED WORKSHOP 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 fiscal year 1995, 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 $40,000,000.''; and
       (2) by adding at the end the following new paragraph:
       ``(7) Agencies awarding one or more contracts to such an 
     organization pursuant to the provisions of this subsection 
     may use multiyear contracts, if appropriate.''.
               TITLE IV--BUSINESS DEVELOPMENT ASSISTANCE
                     Subtitle A--General Provisions

     SEC. 401. SUNSET ON COSPONSORED TRAINING.

       (a) In General.--
       (1) Repeal.--The amendments made by section 5(a) of Small 
     Business Computer Security and Education Act of 1984 (15 
     U.S.C. 633 note) are hereby repealed.
       (2) Effective date.--Paragraph (1) shall take effect on 
     September 30, 1997.
       (b) Conforming Amendment.--Section 7(b) of the Small 
     Business Computer Security and Education Act of 1984 (15 
     U.S.C. 633 note) is amended in the second sentence by 
     striking ``and the amendments made to section 8(b)(1)(A) of 
     the Small Business Act by section 5(a)(2) of this Act are'' 
     and inserting ``is''.

     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) Small business development center program level.--
       ``(A) In general.--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 percent cash and not more than 
     50 percent of indirect costs and in-kind contributions.
       ``(B) Restriction.--The matching amount described in 
     subparagraph (A) shall not include any indirect costs or in-
     kind contributions derived from any Federal program.
       ``(C) National program.--
       ``(i) In general.--Except as provided in clause (ii), no 
     State receiving funds under this section shall receive a 
     grant that exceeds--
       ``(I) for fiscal year 1995, the sum of such State's pro 
     rata share of a national program based upon the population of 
     the State as compared to the total population in the United 
     States, and $125,000; or
       ``(II) in each succeeding fiscal year, the sum of such 
     State's pro rata share of a national program based upon the 
     population of the State as compared to the total population 
     in the United States, and $200,000.
       ``(ii) Exception.--Grants provided to a small business 
     development center by the Administration or another agency to 
     carry out the provisions of subsection (c)(3)(G) shall not be 
     included in the calculation of maximum funding of a small 
     business development center.
       ``(iii) Amount.--The amount of the national program shall 
     be--
       ``(I) $70,000,000 through September 30, 1996;
       ``(II) $77,500,000 from October 1, 1996 through September 
     30, 1997; and
       ``(III) $85,000,000 beginning October 1, 1997.
     The amount for which a small business development center is 
     eligible under this paragraph shall be based upon the amount 
     of the national program in effect as of the date for 
     commencement of performance of the small business development 
     center's grant.''.

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

       Section 21(a)(5) of the Small Business Act (15 U.S.C. 
     648(a)(5)) is amended to read as follows:
       ``(5) Federal contracts with small business development 
     centers.--
       ``(A) In general.--Subject to the conditions set forth in 
     subparagraph (B), a small business development center may 
     enter into a contract with a Federal department or agency to 
     provide specific assistance to small business concerns.
       ``(B) Contract prerequisites.--Before bidding on a contract 
     described in subparagraph (A), a small business development 
     center shall receive approval from the Associate 
     Administrator of the small business development center 
     program of the subject and general scope of the contract. 
     Each approval under subparagraph (A) shall be based upon a 
     determination that the contract will provide assistance to 
     small business concerns and that performance of the contract 
     will not hinder the small business development center in 
     carrying out the terms of the grant received by the small 
     business development center from the Administration.
       ``(C) Exemption from matching requirement.--A contract 
     under this paragraph shall not be subject to the matching 
     funds or eligibility requirements of paragraph (4).
       ``(D) Additional provision.--Notwithstanding any other 
     provision of law, a contract for assistance under this 
     paragraph shall not be applied to any Federal department or 
     agency's small business, woman-owned business, or socially 
     and economically disadvantaged business contracting goal 
     under section 15(g).''.

     SEC. 404. SMALL BUSINESS DEVELOPMENT CENTER PROGRAM 
                   EXAMINATION AND CERTIFICATION.

       Section 21(k) of the Small Business Act (15 U.S.C. 648(k)) 
     is amended to read as follows:
       ``(k) Program Examination and Certification.--
       ``(1) Examination.--Not later than 180 days after the date 
     of enactment of this subsection, the Administration shall 
     develop and implement a biennial programmatic and financial 
     examination of each small business development center 
     established pursuant to this section.
       ``(2) Certification.--The Administration may provide 
     financial support, by contract or otherwise, to the 
     association authorized by subsection (a)(3)(A) for the 
     purpose of developing a small business development center 
     certification program.
       ``(3) Extension or renewal of cooperative agreements.--In 
     extending or renewing a cooperative agreement of a small 
     business development center, the Administration shall 
     consider the results of the examination and certification 
     program conducted pursuant to paragraphs (1) and (2).''.

     SEC. 405. 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 inserting ``, $2,000,000 for each 
     of fiscal years 1993 and 1994, and $1,000,000 for fiscal year 
     1995''.

     SEC. 406. 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 
     (hereafter 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, the Administrator shall, 
     not later than December 31, 1996, transmit to the Congress a 
     report containing the results of such program, together with 
     recommendations for appropriate legislative and 
     administrative action.
       (d) Authorization of Appropriations.--There are authorized 
     to be appropriated to carry out this section $900,000 for 
     each of fiscal years 1995, 1996, and 1997, such sums to 
     remain available until expended. Of such sums--
       (1) $800,000 may be made available for the purchase or 
     lease of mobile resource center vehicles and operating 
     expenses; and
       (2) $100,000 may be made available for studies, startup 
     expenses, and other administrative expenses.

     SEC. 407. INFORMATION CONCERNING FRANCHISING.

       Section 8(b)(1)(A) of the Small Business Act (15 U.S.C. 
     637(b)(1)(A)) is amended by inserting ``including information 
     on the benefits and risks of franchising,'' after ``small-
     business enterprises,''.
           Subtitle B--Development of Woman-Owned Businesses

     SEC. 411. EXTENSION OF AUTHORITY FOR DEMONSTRATION PROJECTS.

       The Small Business Act (15 U.S.C. 631 et seq.) is amended--
       (1) by redesignating section 28 (as added by section 2 of 
     the Women's Business Development Act of 1991) as section 29; 
     and
       (2) in section 29(g), as redesignated, by striking ``1995'' 
     and inserting ``1997''.

     SEC. 412. ESTABLISHMENT OF OFFICE OF WOMEN'S BUSINESS 
                   OWNERSHIP.

       Section 29 of the Small Business Act (15 U.S.C. 656), as 
     redesignated by section 411 of this Act, is amended by adding 
     at the end the following new subsection:
       ``(h) Office of Women's Business Ownership.--There is 
     hereby 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 such term is 
     defined in section 408 of the Women's Business Ownership Act 
     of 1988. The Office of Women's Business Ownership shall be 
     administered by an Assistant Administrator, who shall be 
     appointed by the Administrator.''.

     SEC. 413. DEVELOPMENT OF WOMEN'S BUSINESS ENTERPRISE.

       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 ENTERPRISE

     ``SEC. 401. ESTABLISHMENT OF THE INTERAGENCY COMMITTEE.

       ``There is established an interagency committee to be known 
     as the Interagency Committee on Women's Business Enterprise.

     ``SEC. 402. DUTIES OF THE INTERAGENCY COMMITTEE.

       ``(a) In General.--The Interagency Committee shall--
       ``(1) monitor, coordinate, and promote the plans, programs, 
     and operations of the departments and agencies of the Federal 
     Government that may contribute to the establishment and 
     growth of women's business enterprise;
       ``(2) develop and promote new public sector initiatives, 
     policies, programs, and plans designed to foster women's 
     business enterprise;
       ``(3) review, monitor, and coordinate plans and programs, 
     developed in the public sector, which affect the ability of 
     women-owned businesses to obtain capital and credit;
       ``(4) promote and assist, as appropriate, in the 
     development of surveys of women-owned business; and
       ``(5) design a comprehensive plan for a joint public-
     private sector effort to facilitate growth and development of 
     women's business enterprise, which plan shall, not later than 
     1 year after the effective date of the Small Business 
     Administration Reauthorization and Amendments Act of 1994, be 
     submitted to the President for review.
       ``(b) Meetings.--The Interagency Committee shall meet not 
     less than biannually at such times as the Interagency 
     Committee determines to be necessary to perform the duties 
     under subsection (a). A majority of the members of the 
     Committee shall constitute a quorum for the approval of 
     recommendations or reports issued pursuant to this section.
       ``(c) Interaction With Council.--In performing its duties 
     under subsection (a), the Interagency Committee shall consult 
     with the Council. The Interagency Committee may meet jointly 
     with the Council at the discretion of the chairperson of the 
     Interagency Committee and the chairperson of the Council, but 
     not less frequently than twice annually. The chairperson of 
     the Interagency Committee shall serve as chairperson of any 
     joint meetings of the Interagency Committee and the Council.

     ``SEC. 403. MEMBERSHIP OF THE INTERAGENCY COMMITTEE.

       ``(a) In General.--
       ``(1) Participants.--The Interagency Committee shall be 
     composed of 1 representative from each of the following:
       ``(A) The Department of Commerce.
       ``(B) The Department of Defense.
       ``(C) The Department of Health and Human Services.
       ``(D) The Department of Labor.
       ``(E) The Small Business Administration.
       ``(F) The Department of Transportation.
       ``(G) The Department of the Treasury.
       ``(H) The General Services Administration.
       ``(I) The Board of Governors of the Federal Reserve.
       ``(J) The Executive staff of the President engaged in 
     policymaking activities.
       ``(2) Appointments.--
       ``(A) In general.--Except as provided in subparagraph (B), 
     the head of each department and agency listed in paragraph 
     (1) shall, not later than 45 days after the date of enactment 
     of the Small Business Administration Reauthorization and 
     Amendments Act of 1994, designate a representative who shall 
     be a policymaking official within the department or agency.
       ``(B) Small business administration.--With respect to the 
     Small Business Administration, the representative shall be 
     the Assistant Administrator of the Office of Women's Business 
     Ownership, who also shall serve as the vice chairperson of 
     the Interagency Committee.
       ``(3) Other participation.--Other representatives of the 
     Federal Government not listed in paragraph (1) may 
     participate in the meetings and functions of the Interagency 
     Committee on a temporary basis as needed to carry out 
     specific Interagency Committee goals.
       ``(b) Appointment of Chairperson.--Not later than 45 days 
     after enactment of the Small Business Administration 
     Reauthorization and Amendments Act of 1994, the President, in 
     consultation with the Administrator of the Small Business 
     Administration, shall appoint 1 of the members of the 
     Interagency Committee to serve as chairperson.
       ``(c) Noncompensation.--The members of the Interagency 
     Committee shall serve without additional pay for such 
     membership.
       ``(d) Detail of Federal Employees.--Upon request by the 
     chairperson of the Interagency Committee, the head of any 
     Federal department or agency may detail any of the personnel 
     of such agency to assist the Interagency Committee in 
     carrying out its duties under this title without regard to 
     section 3341 of title 5, United States Code.

     ``SEC. 404. REPORTS FROM THE INTERAGENCY COMMITTEE.

       ``Not later than September 30, 1995, and annually 
     thereafter, the Interagency Committee shall transmit to the 
     President and to the Committees on Small Business of the 
     Senate and the House of Representatives, a report 
     containing--
       ``(1) any recommendations of the Council and any comments 
     of the Interagency Committee thereon;
       ``(2) a detailed description of the activities of the 
     Interagency Committee;
       ``(3) the findings and conclusions of the Interagency 
     Committee; and
       ``(4) the Interagency Committee's recommendations for such 
     legislation and administrative actions as the Interagency 
     Committee considers appropriate to promote the development of 
     small business concerns owned and controlled by women.

     ``SEC. 405. ESTABLISHMENT OF THE NATIONAL WOMEN'S BUSINESS 
                   COUNCIL.

       ``There is established a council to be known as the 
     National Women's Business Council, which shall serve as an 
     independent source of advice and policy recommendations to 
     the Interagency Committee, to the Administrator through the 
     Assistant Administrator of the Office of Women's Business 
     Ownership, to the Congress, and to the President.

     ``SEC. 406. DUTIES OF THE COUNCIL.

       ``(a) In General.--The Council shall advise and consult 
     with the Interagency Committee on matters relating to the 
     activities, functions, and policies of the Interagency 
     Committee, as provided in this title. The Council shall meet 
     jointly with the Interagency Committee at the discretion of 
     the chairperson of the Council and the chairperson of the 
     Interagency Committee, but not less than biannually.
       ``(b) Meetings.--The Council shall meet separately at such 
     times as the Council deems necessary. A majority of the 
     members of the Council shall constitute a quorum for the 
     approval of recommendations or reports issued pursuant to 
     this section.
       ``(c) Recommendations.--The Council shall make annual 
     recommendations for consideration by the Interagency 
     Committee. The Council shall also provide reports and make 
     such other recommendations as it deems appropriate to the 
     Interagency Committee, to the President, to the 
     Administrator, and to the Committees on Small Business of the 
     Senate and the House of Representatives.
       ``(d) Other Duties.--The Council shall--
       ``(1) review, coordinate, and monitor plans and programs 
     developed in the public and private sectors, which affect the 
     ability of women-owned business enterprises to obtain capital 
     and credit;
       ``(2) promote and assist in the development of a women's 
     business census and other surveys of women-owned businesses;
       ``(3) monitor and promote the plans, programs, and 
     operations of the departments and agencies of the Federal 
     Government which may contribute to the establishment and 
     growth of women's business enterprise;
       ``(4) develop and promote new initiatives, policies, 
     programs, and plans designed to foster women's business 
     enterprise; and
       ``(5) advise and consult with the Interagency Committee in 
     the design of a comprehensive plan for a joint public-private 
     sector effort to facilitate growth and development of women's 
     business enterprise.

     ``SEC. 407. MEMBERSHIP OF THE COUNCIL.

       ``(a) Chairperson.--Not later than 45 days after the date 
     of enactment of the Small Business Administration 
     Reauthorization and Amendments Act of 1994, the President 
     shall appoint an individual to serve as chairperson of the 
     Council, in consultation with the Administrator. The 
     chairperson of the Council shall be a prominent business 
     woman who is qualified to head the Council by virtue of her 
     education, training, and experience.
       ``(b) Other Members.--Not later than 60 days after the date 
     of enactment of the Small Business Administration 
     Reauthorization and Amendments Act of 1994, the Administrator 
     shall appoint, in consultation with the Assistant 
     Administrator of the Office of Women's Business Ownership and 
     the chairperson of the Council appointed under subsection 
     (a), 9 members of the Council, of whom--
       ``(1) 2 shall be--
       ``(A) owners of small businesses, as such term is defined 
     in section 3 of the Small Business Act; and
       ``(B) members of the same political party as the President;
       ``(2) 2 shall--
       ``(A) be owners of small businesses, as such term is 
     defined in section 3 of the Small Business Act; and
       ``(B) not be members of the same political party as the 
     President; and
       ``(3) 5 shall be representatives of national women's 
     business organizations.
       ``(c) Diversity.--In appointing members of the Council, the 
     Administrator shall, to the extent possible, ensure that the 
     members appointed reflect geographic, racial, economic, and 
     sectoral diversity.
       ``(d) Service Term.--The term of service of the members of 
     the Council shall be 3 years.
       ``(e) Other Federal Service.--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 30-day 
     period beginning on the date on which such individual becomes 
     such an officer or employee.
       ``(f) Vacancies.--A vacancy on the Council shall, not later 
     than 30 days after the date on which the vacancy occurs, be 
     filled in the same manner in which the original appointment 
     was made.
       ``(g) Reimbursements.--Members of the Council shall serve 
     without pay for such membership, except that members 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.
       ``(h) Executive Director.--Not later than 60 days after the 
     date of enactment of the Small Business Administration 
     Reauthorization Act of 1994, the Administrator, in 
     consultation with the chairperson of the Council, shall 
     appoint an executive director of the Council. Upon the 
     recommendation by the executive director, the chairperson of 
     the Council may appoint and fix the pay of 4 additional 
     employees of the Council, at a rate of pay not to exceed the 
     maximum rate of pay payable for a position at GS-15 of the 
     General Schedule. All such appointments shall be subject to 
     the appropriation of funds.
       ``(i) Rates of Pay.--The executive director and staff of 
     the Council may be appointed without regard to the provisions 
     of title 5, United States Code, governing appointments in the 
     competitive service, and except as provided in subsection 
     (e), may be paid without regard to the provisions of chapter 
     51 and subchapter III of chapter 53 of such title relating to 
     classification and General Schedule pay rates, except that 
     the executive director may not receive pay in excess of the 
     annual rate of basic pay payable for a position at ES-3 of 
     the Senior Executive Pay Schedule under section 5832 of title 
     5, United States Code.

     ``SEC. 408. DEFINITIONS.

       ``For purposes of this title--
       ``(1) the term `Administration' means the Small Business 
     Administration;
       ``(2) the term `Administrator' means the Administrator of 
     the Small Business Administration;
       ``(3) the term `control' means exercising the power to make 
     policy decisions concerning a business;
       ``(4) the term `Council' means the National Women's 
     Business Council, established under section 405;
       ``(5) the term `Interagency Committee' means the 
     Interagency Committee on Women's Business Enterprise, 
     established under section 401;
       ``(6) the term `operate' means being actively involved in 
     the day-to-day management of a business;
       ``(7) the term `women's business enterprise' means--
       ``(A) a business or businesses owned by a woman or a group 
     of women; or
       ``(B) the establishment, maintenance, or development of a 
     business or businesses by a woman or a group of women; and
       ``(8) the term `women-owned business' means a small 
     business which a woman or a group of women--
       ``(A) control and operate; and
       ``(B) own not less than 51 percent of the business.

     ``SEC. 409. AUTHORIZATION OF APPROPRIATIONS.

       ``There are authorized to be appropriated for each of 
     fiscal years 1995 through 1997, to carry out this title, 
     $350,000.''.

     SEC. 414. TRANSITION REIMBURSEMENT.

       (a) In General.--Subject to the limitation contained in 
     subsection (b), in order to provide continuity in the 
     development of women-owned business, the Administration may 
     approve reasonable amounts made available to carry out title 
     IV of the Women's Business Ownership Act of 1988 to be used 
     to pay the salaries, if any, and expenses of the members and 
     staff of the National Women's Business Council that are 
     appointed on or before the date of enactment of this Act.
       (b) Time Period.--No payments shall be made under 
     subsection (a) after the expiration of the 90-day period 
     beginning on the date of enactment of this Act.

     SEC. 415. GIFT AUTHORITY.

       Section 8(b)(1)(G) of the Small Business Act (15 U.S.C. 
     637(b)(1)(G)) is amended by striking ``section 8(b)(1) of 
     this Act'' and by inserting ``this Act and to carry out the 
     activities authorized by title IV of the Women's Business 
     Ownership Act of 1988''.

     SEC. 416. CONFORMING AMENDMENT.

       The table of contents for the Women's Business Ownership 
     Act of 1988 (15 U.S.C. 631 note) is amended by striking the 
     items relating to title IV and inserting the following:

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

``Sec. 401.  Establishment of the Interagency Committee.
``Sec. 402.  Duties of the Interagency Committee.
``Sec. 403.  Membership of the Interagency Committee.
``Sec. 404.  Reports from the Interagency Committee.
``Sec. 405.  Establishment of the National Women's Business Council.
``Sec. 406.  Duties of the Council.
``Sec. 407.  Membership of the Council.
``Sec. 408.  Definitions.
``Sec. 409.  Authorization of Appropriations.''.
          TITLE V--RELIEF FROM DEBENTURE PREPAYMENT PENALTIES

     SEC. 501. SHORT TITLE.

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

     SEC. 502. INTENTION OF CONGRESS.

       (a) In General.--The Small Business Administration shall 
     fully utilize the $30,000,000 appropriated in Public Law 103-
     317 to reduce, in accordance with this title and the 
     amendments made by this title, prepayment penalties imposed 
     in connection with debentures issued under--
       (1) section 303 or 503 of the Small Business Investment Act 
     of 1958, which have been purchased by the Federal Financing 
     Bank; and
       (2) Title III to companies operating under section 301(d) 
     of such Act, which have been purchased by the Small Business 
     Administration.
       (b) Equal Opportunity.--In order to provide an equal 
     opportunity to participate in the program authorized under 
     this title, the Small Business Administration shall afford 
     each borrower or issuer of a debenture subject to this title, 
     not less than 45 days to elect to participate and to provide 
     an earnest money deposit. The Administration shall 
     subsequently allow a period of not less than 4 months, during 
     which those borrowers or issuers that elect to participate 
     shall be allowed to complete the prepayment process.
       (c) Restrictions on Participation.--In no event shall the 
     Small Business Administration--
       (1) allow any borrower or issuer to participate in the 
     program if the borrower or issuer fails to--
       (A) make a timely election and provide the deposit on a 
     timely basis; or
       (B) complete the prepayment process within the required 
     time; or
       (2) allow any borrower or issuer to participate in the 
     program at a percentage rate other than the rate finally 
     determined to be applicable to all other borrowers or issuers 
     with similar terms of years.

     SEC. 503. PREPAYMENT OF DEVELOPMENT COMPANY DEBENTURES.

       Title V of the Small Business Investment Act of 1958 (15 
     U.S.C. 695 et seq.), as amended by section 217, is amended by 
     adding at the end the following new section:

     ``SEC. 509. PREPAYMENT OF DEVELOPMENT COMPANY DEBENTURES.

       ``(a) In General.--
       ``(1) Prepayment authorized.--Subject to the requirements 
     set forth in subsection (b), an issuer of a debenture 
     purchased by the Federal Financing Bank and guaranteed by the 
     Administration under this Act may, at the election of the 
     borrower (in the case of a loan under section 503) or the 
     issuer (in the case of a small business investment company) 
     and with the approval of the Administration, prepay such 
     debenture in accordance with the provisions of this section. 
     A small business investment company operating under the 
     authority of section 301(d) that has issued a debenture that 
     was purchased by and is held by the Administration, may, 
     under the same terms and conditions, prepay such debenture, 
     and the penalty as provided in this section, and shall 
     thereafter be immediately eligible to apply for additional 
     assistance from the Administration.
       ``(2) Procedure.--
       ``(A) In general.--In making a prepayment under paragraph 
     (1)--
       ``(i) the borrower (in the case of a loan under section 
     503) or the issuer (in the case of a small business 
     investment company) shall pay to the Federal Financing Bank 
     an amount that is equal to the sum of the unpaid principal 
     balance due on the debenture as of the date of the prepayment 
     (plus accrued interest at the coupon rate on the debenture) 
     and the amount of the repurchase premium described in 
     subparagraph (B); and
       ``(ii) the Administration shall pay to the Federal 
     Financing Bank the difference between the repurchase premium 
     paid by the borrower under this subsection and the repurchase 
     premium that the Federal Financing Bank would otherwise have 
     received.
       ``(B) Repurchase premium.--
       ``(i) In general.--For purposes of subparagraph (A)(i), the 
     repurchase premium is the amount equal to the product of--

       ``(I) the unpaid principal balance due on the debenture on 
     the date of prepayment; and
       ``(II) the applicable percentage rate, as determined in 
     accordance clauses (ii) and (iii).

       ``(ii) Applicable percentage rate.--For purposes of clause 
     (i)(II), the applicable percentage rate means--

       ``(I) with respect to a 10-year term loan, 8.5 percent;
       ``(II) with respect to a 15-year term loan, 9.5 percent;
       ``(III) with respect to a 20-year term loan, 10.5 percent; 
     and
       ``(IV) with respect to a 25-year term loan, 11.5 percent.

       ``(iii) Adjustments to applicable percentage rate.--The 
     percentage rates described in clause (ii) shall be increased 
     or decreased by the Administration by a factor not to exceed 
     one-third, if the same factor is applied in each case and if 
     the Administration determines that an adjustment is 
     necessary, based on the number of borrowers having given 
     notice of their intent to participate, in order to make the 
     program (including the amounts appropriated for this purpose 
     under Public Law 103-317) result in no substantial net gain 
     or loss of revenue to the Federal Financing Bank or to the 
     Administration. Amounts collected in excess of the amount 
     necessary to ensure revenue neutrality shall be refunded to 
     the borrowers.
       ``(b) Requirements.--For purposes of subsection (a), the 
     requirements of this subsection are that--
       ``(1) the debenture is outstanding and neither the loan 
     that secures the debenture, if any, nor the debenture is in 
     default on the date on which the prepayment is made;
       ``(2) State, local, or personal funds, or the proceeds of a 
     refinancing in accordance with subsection (d) of this section 
     under the programs authorized by this title, are used to 
     prepay or roll over the debenture; and
       ``(3) with respect to a debenture issued under section 503, 
     the issuer certifies that the benefits, net of fees and 
     expenses authorized herein, associated with prepayment of the 
     debenture are entirely passed through to the borrower.
       ``(c) No Prepayment Fees or Penalties.--No fees or 
     penalties other than those specified in this section may be 
     imposed on the issuer, the borrower, the Administration, or 
     any fund or account administered by the Administration as the 
     result of a prepayment under this section.
       ``(d) Refinancing Limitations.--
       ``(1) In general.--The refinancing of a debenture under 
     sections 504 and 505, in accordance with subsection (b)(2)--
       ``(A) shall not exceed the amount necessary to prepay 
     existing debentures, including all costs associated with the 
     refinancing and any applicable prepayment penalty or 
     repurchase premium; and
       ``(B) except as provided in paragraphs (2) and (3), shall 
     be subject to the provisions of sections 504 and 505 and the 
     rules and regulations promulgated thereunder, including rules 
     and regulations governing payment of authorized expenses, 
     commissions, fees, and discounts to brokers and dealers in 
     trust certificates issued pursuant to section 505.
       ``(2) Job creation.--An applicant for refinancing under 
     section 504 of a loan made pursuant to section 503 shall not 
     be required to demonstrate that a requisite number of jobs 
     will be created with the proceeds of a refinancing.
       ``(3) Loan processing fee.--To cover the cost of loan 
     packaging, processing, and other administrative functions, a 
     development company that provides refinancing under 
     subsection (b)(2) may impose a one-time loan processing fee, 
     not to exceed 0.5 percent of the principal amount of the 
     loan.
       ``(4) New debentures.--Issuers of debentures under title 
     III may issue new debentures in accordance with such title in 
     order to prepay existing debentures as authorized in this 
     section.
       ``(5) Preliminary notice.--
       ``(A) In general.--The Administration shall use certified 
     mail and other reasonable means to notify each eligible 
     borrower of the prepayment program provided in this title. 
     Each preliminary notice shall specify the range and dollar 
     amount of repurchase premiums which could be required of that 
     borrower in order to participate in the program. In carrying 
     out this program, the Administration shall provide a period 
     of not less than 45 days following the receipt of such notice 
     by the borrower during which the borrower must notify the 
     Administration of the borrower's intent to participate in the 
     program. The Administration shall require that a borrower who 
     gives notice of its intent to participate to make an earnest 
     money deposit of $1,000 which shall not be refundable but 
     which shall be credited toward the final repurchase premium.
       ``(B) Definition.--For purposes of this paragraph, the term 
     `borrower', in the case of a small business investment 
     company or a specialized small business investment company, 
     means `issuer'.
       ``(6) Final notice.--Based upon the response to the 
     preliminary notice under paragraph (5), the Administration 
     shall make a final computation of the necessary prepayment 
     premiums and shall notify each qualified respondent of the 
     results of such computation. Each qualified respondent shall 
     be afforded not less than 4 months to complete the 
     prepayment.
       ``(e) Definitions.--For purposes of this section--
       ``(1) the term `issuer' means--
       ``(A) the qualified State or local development company that 
     issued a debenture pursuant to section 503, which has been 
     purchased by the Federal Financing Bank; and
       ``(B) a small business investment company licensed pursuant 
     to subsection (c) or (d) of section 301; or
       ``(2) the term `borrower' means a small business concern 
     whose loan secures a debenture issued pursuant to section 
     503.
       ``(f) Regulations.--Not later than 30 days after the date 
     of enactment of this section, the Administration shall 
     promulgate such regulations as may be necessary to carry out 
     this section.
       ``(g) Authorization.--There are authorized to be 
     appropriated $30,000,000 to carry out the provisions of The 
     Small Business Prepayment Penalty Relief Act of 1994.
                   TITLE VI--MISCELLANEOUS AMENDMENTS

     SEC. 601. 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) Following the close of each fiscal year, the 
     Administration shall pay into the miscellaneous receipts of 
     the United States Treasury the actual interest that the 
     Administration collects during that fiscal year on all 
     financings made under this Act.''.

     SEC. 602. 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 at the end the following new paragraphs:
       ``(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, except that the Administrator may, 
     subject to approval in appropriations Acts, impose, retain, 
     and utilize, additional fees--
       ``(A) not to exceed $100 for each loan servicing action 
     (other than a loan assumption) requested after disbursement 
     of the loan, including any substitution of collateral, 
     release or substitution of a guarantor, reamortization, or 
     similar action;
       ``(B) not to exceed $300 for loan assumptions;
       ``(C) not to exceed 1 percent of the amount of requested 
     financings under title III of the Small Business Investment 
     Act of 1958 for which the applicant requests a commitment 
     from the Administration for funding during the following 
     year; and
       ``(D) to recover the direct, incremental cost involved in 
     the production and dissemination of compilations of 
     information produced by the Administration under the 
     authority of this Act and the Small Business Investment Act 
     of 1958; and
       ``(13) 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, except that 
     amounts collected under this paragraph and paragraph (12) 
     shall be utilized solely to facilitate the administration of 
     the program that generated the excess amounts.''.

     SEC. 603. JOB CREATION AND COMMUNITY BENEFIT.

       Section 7(a)(21) of the Small Business Act (15 U.S.C. 
     636(a)(21)) is amended by adding at the end the following new 
     subparagraph:
       ``(E) Job creation and community benefit.--In providing 
     assistance under this paragraph, the Administration shall 
     develop procedures to ensure, to the maximum extent 
     practicable, that such assistance is used for projects that--
       ``(i) have the greatest potential for--

       ``(I) creating new jobs for individuals whose employment is 
     involuntarily terminated due to reductions in Federal defense 
     expenditures; or
       ``(II) preventing the loss of jobs by employees of small 
     business concerns described in subparagraph (A)(i); and

       ``(ii) have substantial potential for stimulating new 
     economic activity in communities most affected by reductions 
     in Federal defense expenditures.''.

     SEC. 604. MICROLOAN PROGRAM AMENDMENTS.

       Section 7(m)(9)(B) of the Small Business Act (15 U.S.C. 
     636(m)(9)(B)) is amended--
       (1) by inserting ``and loan guarantees'' after ``for 
     loans''; and
       (2) by inserting after ``experienced microlending 
     organizations'' the following: ``and national and regional 
     nonprofit organizations that have demonstrated experience in 
     providing training support for microenterprise development 
     and financing.''.

     SEC. 605. TECHNICAL CLARIFICATION.

       (a) Defense Conversion.--Section 7(a)(21)(A) of the Small 
     Business Act (15 U.S.C. 636(a)(21)(A)) is amended by striking 
     ``under the'' and inserting ``on a guaranteed basis under 
     the''.
       (b) Additional Technical Clarification.--Section 204 of 
     Public Law 94-305 (15 U.S.C. 634d) is amended by striking 
     ``section 202'' and inserting ``this title''.

     SEC. 606. STUDY AND DATA BASE: GUARANTEED BUSINESS LOAN 
                   PROGRAM AND DEVELOPMENT COMPANY PROGRAM.

       (a) Study Authorized.--The Administration shall conduct a 
     study of--
       (1) the Guaranteed Business Loan program under section 7(a) 
     of the Small Business Act; and
       (2) the Development Company program under sections 502, 
     503, and 504 of the Small Business Investment Act of 1958.
       (b) Evaluation.--For purposes of the study conducted under 
     subsection (a), the Administration shall evaluate the 
     performance of the programs described in paragraphs (1) and 
     (2) of subsection (a), using data from the most recent 4-year 
     period. Such evaluation shall focus on the following factors:
       (1) The number, dollar amount, and average size of the 
     loans or financings under each program.
       (2) The number, dollar amount, and average size of the 
     loans or financings made to woman-owned and minority-owned 
     businesses under each program.
       (3) The geographic distribution of the loans or financings 
     under each program.
       (4) The jobs created or maintained attributable to the 
     loans or financings under each program.
       (5) The number, dollar amount, and average size of the 
     loans or financings on which borrowers defaulted under each 
     program.
       (6) The amounts recovered by the Administration after 
     default, foreclosure, or otherwise under each program.
       (7) The number of companies which are no longer in business 
     despite receiving the loans or financings under each program.
       (8) The taxes paid by businesses which received the loans 
     or financings under each program.
       (9) Such other information as the Administration determines 
     to be appropriate for a complete evaluation of each program.
       (c) Contracting With Independent Entities.--In carrying out 
     subsections (a) and (b), the Administration may contract with 
     an independent entity or entities--
       (1) to conduct the study pursuant to subsection (a); and
       (2) to develop a database of information to enable the 
     Administration to maintain and access, on an ongoing basis, 
     current information relating to the factors set forth in 
     subsection (b).
       (d) Date.--The study authorized by subsection (a) shall be 
     completed not later than September 30, 1995.

     SEC. 607. 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) for a term not to exceed 3 years. Such 
     selection shall be competitive and shall utilize merit-based 
     criteria.''.

     SEC. 608. PROGRAM EXTENSION.

       Section 602(e) of the Business Opportunity Development 
     Reform Act of 1988 (15 U.S.C. 637 note) is amended by 
     striking ``September 30, 1994'', and inserting ``September 
     30, 1997''.

     SEC. 609. PROHIBITION ON THE USE OF FUNDS FOR INDIVIDUALS NOT 
                   LAWFULLY WITHIN THE UNITED STATES.

       Section 2 of the Small Business Act (15 U.S.C. 631) is 
     amended by adding at the end the following new subsection:
       ``(i) Prohibition on the 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 if the Administrator or the official to which the 
     funds are made available receives notification that the 
     individual is not lawfully within the United States.''.

     SEC. 610. OFFICE OF ADVOCACY EMPLOYEES.

       Section 204 of Public Law 94-305 (15 U.S.C. 634d) is 
     amended--
       (1) in the matter preceding paragraph (1), by striking 
     ``after consultation with and subject to the approval of the 
     Administrator,''; and
       (2) in paragraph (1), by striking ``ten'' and inserting 
     ``14''.

     SEC. 611. PROHIBITION ON THE PROVISION OF ASSISTANCE.

       Section 4 of the Small Business Act (15 U.S.C. 633) is 
     amended by adding at the end the following new subsection:
       ``(e) Prohibition on the Provision of Assistance.--
     Notwithstanding any other provision of law, the 
     Administration is prohibited from providing any financial or 
     other assistance to any business concern or other person 
     engaged in the production or distribution of any product or 
     service that has been determined to be obscene by a court of 
     competent jurisdiction.''.

     SEC. 612. CERTIFICATION OF COMPLIANCE WITH CHILD SUPPORT 
                   OBLIGATIONS.

       Section 4 of the Small Business Act (15 U.S.C. 633), as 
     amended by section 611, is amended by adding at the end the 
     following new subsection:
       ``(f) Certification of Compliance With Child Support 
     Obligations.--
       ``(1) In general.--For financial assistance approved after 
     the promulgation of final regulations to implement this 
     section, each recipient of financial assistance under this 
     Act, including a recipient of a direct loan or a loan 
     guarantee, shall certify that the recipient is not more than 
     60 days delinquent under the terms of any--
       ``(A) administrative order;
       ``(B) court order; or
       ``(C) repayment agreement entered into between the 
     recipient and the custodial parent or State agency providing 
     child support enforcement services,
     that requires the recipient to pay child support, as such 
     term is defined in section 462(b) of the Social Security Act.
       ``(2) Enforcement.--Not later than 6 months after the date 
     of enactment of this subsection, the Administration shall 
     promulgate such regulations as may be necessary to enforce 
     compliance with the requirements of this subsection.''.

     SEC. 613. 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 not 
     later than 1 year after the date of enactment of this Act.
       And the House agree to the same.
       That the House recede from its amendment to the title of 
     the bill, and agree to the same.
     John J. LaFalce,
     Neal Smith,
     Ron Wyden,
     Jan Meyers,
     Richard H. Baker,
       Managers on the part of the House.

     Dale Bumpers,
     Sam Nunn,
     Larry Pressler,
       Managers on the part of the Senate.

       JOINT EXPLANATORY STATEMENT OF THE COMMITTEE OF CONFERENCE

       The managers on the part of the House and the Senate at the 
     conference on the disagreeing votes of the two Houses on the 
     amendments of the House to the bill (S. 2060) to amend the 
     Small Business Act and the Small Business Investment Act of 
     1958, and for other purposes, submit the following joint 
     statement to the House and the Senate in explanation of the 
     effect of the action agreed upon by the managers and 
     recommended in the accompanying conference report:
       The conference agreement establishes authorizations of 
     appropriations for programs of the Small Business 
     Administration, creates several new programs and makes a 
     number of changes in existing programs.

                        TITLE I: AUTHORIZATIONS

       In title I, the conference agreement authorizes 
     appropriations for SBA's several business loan programs and 
     for certain business development programs for fiscal years 
     1995, 1996 and 1997. Included among the loan programs are 
     section 7(a) loan guarantees, 7(a)(21) defense conversion 
     loan guarantees, section 502 and 504 Development Company 
     loans, Handicapped direct loans, Microloans, Small Business 
     Investment Company (SBIC) debentures, Specialized SBIC 
     preferred stock and debentures, and SBIC participating 
     securities. Also included in the conference agreement for 
     this title is a ``such sums as may be necessary'' 
     authorization of appropriations for SBA business and 
     homeowner disaster loans, which are direct loans made to 
     individuals and businesses in communities which have been 
     affected by natural disasters.
       Except for disaster loan funding, the conferees' agreement 
     as well as the House and Senate authorization levels with 
     respect to funding for SBA's loan programs, and certain 
     business development programs are set forth in the following 
     chart. In general, the conferees agreed to funding levels 
     midway between the House and Senate levels. The conferees 
     adopted the Senate levels for defense conversion guaranteed 
     loans, except for 1997, and reduced levels for Small Business 
     Development Center defense conversion assistance.
       The conferees agreed to the House amendment with respect to 
     the SBIC and Specialized SBIC funding levels for the 
     debenture programs and the preferred stock and participating 
     securities programs. Although the conferees strongly support 
     these venture capital programs, especially the new SBIC 
     participating security program which has just begun and has 
     attracted many more well-financed applications than was 
     anticipated, the conferees were concerned about the rapid 
     increases in funding levels of these programs. For example, 
     the Administration's request would have almost tripled the 
     funding for SBIC participating securities to $1.7 billion in 
     fiscal year 1997. The Senate bill, while including lower 
     funding levels than requested, would have more than doubled 
     the program to over $1 billion over the same period. The 
     conferees agreed to the House provisions which are 
     significantly higher than appropriated levels for fiscal year 
     1995 and which retain existing law with respect to the 
     participating securities program.
       The conferees also agreed that, upon completion of the 
     report on the SBIC and Specialized SBIC programs required by 
     section 216, the House and Senate Committees on Small 
     Business will reevaluate the funding levels for fiscal years 
     1996 and 1997 for all SBIC and Specialized SBIC programs.

                                                                    CONFERENCE AGREEMENT--SBA REAUTHORIZATION FUNDING LEVELS                                                                    
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                                                           Proposed FY95                                   Proposed FY96                                   Proposed FY97                        
                     Program                     --------------------------------   Conference   --------------------------------   Conference   --------------------------------   Conference  
                                                      Senate          House          agreement        Senate           House         agreement        Senate           House         agreement  
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
7(A) Guarantees (billions)......................           $9             $7.815           $9.15          $10             $10.93          $10.5           $12             $14.2           $13.1 
Defense conversion (7(A)(21)) (billions)........            2.0            1.5              2               2.5             0               2.5             3.5             0               3   
Microloans direct (millions)....................          110            130              120             175             185             180             250             250             250   
Microloan--TA (millions)........................           45              0               45              65               0              65              98               0              98   
Micro guarantee pilot (millions)................           15             20               20              20              30              30              20              40              40   
Handicapped direct loans (millions).............            0             12               10               0              13              11               0              14              12   
504/502 Development Cos. (billions).............            2.3            2.2              2.25            2.8             2.5             2.65            3.5             3               3.25
SBIC debentures (millions)......................          230            200              200             250             210             210             310             220             220   
SBIC participating (millions)...................          500            400              400             750             650             650               1.25          900             900   
MESBIC stock (SSBIC) (millions).................           33             23               23              39              24              24              45              25              25   
MESBIC guaranty (SSBIC) (millions)..............           55             44               44              70              46              46              75              48              48   
Surety bond (billions)..........................            1.8            1.8              1.8             2               1.8             1.9             2.2             1.8             2   
Score (millions)................................            3.5            3.5              3.5             3.75            3.67            3.7             4               3.86            3.9 
SBI.............................................            3              3                3               3.25            3.15            3.25            3.5             3.31            3.4 
SBDCs: regular..................................           70             70               70              77.5            77.5            77.5            85              85              85   
SBCDs: defense conversion.......................           25              0                5              25               0              10              25               0              15   
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                TITLE II: FINANCIAL ASSISTANCE PROGRAMS

     Sec. 201. Microloan financing pilot
       Both the Senate bill and the House amendment contained 
     provisions authorizing SBA to establish a guaranteed 
     microloan pilot program. The conferees agreed to the Senate 
     provision with an amendment deleting the language that 
     authorized SBA to subsidize the interest rate to the 
     intermediaries in the guaranteed program. The microloan 
     guarantee program was requested by the Administration and 
     will test the concept of loan guarantees in the place of 
     direct loans to intermediaries.
     Sec. 202. Eligibility of Native American Tribal Governments 
         to be microloan intermediaries
       The Senate bill contained a provision permitting Native 
     American tribes to participate in the microloan program as 
     intermediaries. The House amendment contained no such 
     provision.
       The conferees adopted the Senate provision.
     Sec. 203. Microloan program extension
       The Senate bill contained a provision which extended the 
     Microloan direct loan program to October 1, 1998. The House 
     amendment had no similar provision. The conferees agreed to 
     extend the program until October 1, 1997, which is consistent 
     with other loan program authorizations.
     Sec. 204. Microloan program funding and State limitations
       The Senate bill increased the number of microloan programs 
     that SBA is authorized to fund from 110 to 150 in fiscal year 
     1995 and to 200 thereafter. The House amendment increased the 
     number to 240 programs beginning in fiscal year 1995. The 
     conferees agreed to increase the number to 200 programs 
     beginning in fiscal 1995.
       The Senate bill also raised the maximum funding per state 
     in the microloan program from $2.5 million to $10 million. 
     The House amendment repealed the ceiling completely. The 
     conferees agreed to increase the ceiling by permitting each 
     state annually to receive not more than 125 percent of its 
     pro rata share of SBA's microloan program funding for that 
     fiscal year. The state's share is to be calculated based on 
     the population of the state as compared to the total 
     population of the United States, including its territories 
     and possessions.
       The Senate bill also increased from 25 to 50 the number of 
     microloan grant programs funded under paragraph (5)(A) of 
     section 7(m) of the Small Business Act as well as the amount 
     each grantee could receive from $125,000 to $150,000. The 
     House amendment contained no such provision. The conferees 
     agreed to the House amendment which deleted the increases.
     Sec. 205. Distribution of intermediaries
       The Senate bill contained a provision directing SBA to 
     select microloan intermediaries in a manner to further the 
     goal of making microloans available to small businesses in 
     all industries regardless of their location in a state and 
     especially to those located in economically distressed areas.
       The House amendment contained a provision directing SBA to 
     select microloan intermediaries in a manner to ensure that 
     microloans are available in urban and rural areas.
       The conferees adopted the House amendment and added the 
     requirement that SBA strive to make microloans available 
     throughout each state to small businesses in all industries. 
     SBA should make every effort to provide appropriate 
     availability of microloans in rural and urban areas.
     Sec. 206. Microloan intermediary loan limitation
       The Senate bill increased the maximum amount of leverage to 
     an intermediary in the microloan program from $1.25 million 
     to $2 million. The House amendment repealed the cap and based 
     each intermediary's funding on a population-based formula.
       The conferees agreed to increase the cap to $2.5 million 
     per intermediary.
     Sec. 207. Microloan technical assistance to nonborrowers
       The Senate bill included a provision which would permit an 
     intermediary to use up to 20 percent of its microloan 
     technical assistance grant to provide marketing, management, 
     and technical assistance to nonborrowers.
       The House amendment contained no similar provision.
       The conferees agreed to permit an intermediary to use up to 
     15 percent of its technical assistance grant to provide 
     assistance to prospective borrowers. The conferees recognize 
     intermediaries hold outreach seminars, perform screening 
     analyses, and provide other assistance prior to the applicant 
     becoming a borrower. The conferees support this practice but 
     also are keenly aware of the increasing difficulty of 
     securing grant appropriations. Therefore, the conferees 
     encourage the intermediaries to use their technical 
     assistance grants as efficiently and cost-effectively as 
     possible. No assistance to nonborrowers should be provided, 
     since many other management assistance and training programs 
     are available to these individuals.
     Sec. 208. Microloan technical assistance grants for 
         intermediaries serving economically distressed areas
       The Senate bill provides an extra five percent (but in no 
     case more than 30 percent) technical assistance grant to any 
     microloan intermediary making 25 percent of its loans to 
     businesses owned by members of Federally recognized American 
     Indian Tribes. This five percent would not be subject to any 
     matching requirement. In addition, the amendment provided 
     that intermediaries making 50 percent of their loans to 
     businesses owned by members of Federally recognized American 
     Indian Tribes would receive the full 30 percent maximum in 
     technical assistance grants and none of the grant would be 
     subject to the matching requirements. The House bill had no 
     similar provision.
       The Conferees agreed to a three-year pilot program 
     identical in structure, but with more broadly based 
     eligibility. The conference report provides an extra five 
     percent (but in no case more than 30 percent) technical 
     assistance grant to an intermediary making 25 percent of its 
     loans to small business concerns located in or owned by one 
     or more residents of an economically distressed area. This 
     five percent would not be subject to any matching 
     requirement. In addition, the conference report provides that 
     intermediaries making 50 percent of their loans to small 
     business concerns located in or owned by one or more 
     residents of an economically distressed area would receive 
     the full 30 percent maximum in technical assistance grants 
     without any matching requirements. For purposes of this 
     section, ``economically distressed area'' means a county or 
     equivalent division of local government in the state in which 
     the small business concern is located, in which, according to 
     the most recent data available from the United States Bureau 
     of the Census, 40 percent or more of individuals live at or 
     below the poverty level.
     Sec. 209 Loans to exporters
     Sec. 210 Working capital international trade loans
     Sec. 211 Guarantees on international trade loans
       The Senate bill contained three provisions which modify 
     SBA's export loan guarantee authority, increase to $750,000 
     the amount of an international trade loan SBA can make for 
     working capital, and increase the maximum guarantee SBA may 
     make on an international trade loan to 90 percent.
       The House amendment contained identical provisions which 
     were adopted by the conferees.
     Sec. 212. Accredited lenders program
       Both the Senate bill and the House amendment contained 
     provisions establishing an Accredited Lenders program (ALP) 
     for qualified State and local development companies. This 
     program is modeled after the idea of the certified lender 
     program which is a successful SBA program for delivering 7(a) 
     guaranteed loans more efficiently. In the ALP program, well 
     qualified certified development companies which meet certain 
     criteria will be accredited and will receive expedited 
     processing and serving from SBA. The Senate requires SBA to 
     report after one year of the results of this program.
       The House amendment contains almost identical provisions 
     for the establishment of an ALP program. The House amendment, 
     however, required an annual report on the program.
       The conferees agreed to the Senate provisions with a 
     requirement for a biennial report on the program beginning 
     one year after the enactment of this Act.
     Sec. 213. Interest rate on certified development company 
         loans
       The Senate bill contained a provision which makes permanent 
     SBA's authority to establish a national interest rate on the 
     SBA guaranteed portion of a 504 development company 
     financing.
       The House amendment contained no similar provision.
       The House recedes to the Senate provision.
     Sec. 214. Certifications of eligibility for SBIC and SSBIC 
         financing
       The Senate bill contained an eligibility certification 
     requirement for Small Business Investment Companies and 
     Specialized Small Business Investment Companies with respect 
     to each of their borrowers.
       The House contained no similar provision.
       The House recedes to the Senate provision.
     Sec. 215. Participating securities for smaller SBICs
       Both the Senate bill and the House amendment contained 
     provisions generally requiring one-half of each year's 
     appropriation for the participating securities program to be 
     reserved for smaller SBICs, which are defined for this 
     purpose as those with private capital of less than $20 
     million.
       The conferees adopted the provision and clarified that 
     smaller SBICs were those with private capital of $20 million 
     or less.
     Sec. 216. Report on SBIC program
       The House amendment contained a provision requiring SBA to 
     conduct a comprehensive report on the SBIC and Specialized 
     SBIC programs which was to be completed by April 15, 1995.
       The Senate bill contained no similar provision.
       The conference substitute adopted the House amendment but 
     changed the due date of the study to May 15, 1995, to enable 
     SBA to use the most current data in its program review.
     Sec. 217. Premier Certified Lenders Program
       Section 210 of the House amendment would authorize the 
     Administration to establish a Premier Lenders Program for 
     certain certified development companies which provide 
     financing to small businesses for plant and equipment needs. 
     Eligibility for admission to the program would be based upon 
     the company's satisfactory prior performance under the 
     development company program.
       Companies participating in the program would receive a 
     delegation of authority from the Small Business 
     Administration and would be authorized to issue guarantees on 
     behalf of the Administration. In order to participate, 
     however, the company would be required to agree to reimburse 
     the Agency for 5% of and loss sustained by the SBA on account 
     of guarantees issued under the delegated authority. Also, the 
     company would be required to establish a monetary reserve 
     equal to 3% of the amount of the financings approved. The 
     reserve could consist of cash, letters of credit or indemnity 
     agreements.
       The program would be repealed in 5 years.
       The Senate bill contains no comparable provision.
       The Conference substitute includes a Premier Certified 
     Lenders Program as a three-year pilot program in which a 
     maximum of 15 development companies could participate.
       The contingent exposure of the development company for 
     losses on account of financings approved under the program is 
     set at 10 percent of the amount of the financing. The amount 
     of the loss reserve is required to be an amount equal to 10 
     percent of the contingent exposure. Only cash can be used to 
     constitute the reserve, but it can be contributed in 
     installments over two years as follows:
       One-half of one percent of the financing when each 
     debenture is closed, one-quarter of one percent of the 
     financing within the first year, and the final quarter of one 
     percent of the financing within the second year.


                   Measures not included in Title II

       1. Section 209 of the Senate bill would have permitted a 
     microloan intermediary or a microloan grant recipient 
     (sometimes called ``non-intermediaries'') to participate in 
     the other SBA microloan program, provided that other groups 
     of potential microborrowers would be served.
       The House amendment contained no similar provision. The 
     House conferees raised concerns about augmenting technical 
     assistance grants and duplication of services.
       The Senate recedes to the House on this provision.
       2. Section 211 of the House amendment contained a provision 
     establishing an Investment Advisory Council for the 
     Specialized Small Business Investment Company Program. The 
     Advisory Council was to be composed of not less than 12 
     private sector individuals with expertise in providing 
     venture capital to small business, particularly minority 
     small business.
       The Senate bill contained no similar provision.
       The House recedes from its amendment, based upon receipt of 
     a letter from Cassandra Pulley, Deputy Administrator of the 
     Small Business Administration (SBA), which follows. The 
     letter informed the Committees that the SBA is forming such 
     an Advisory Council to be operational by November 30, 1994. 
     The Council is to assess the appropriateness and ability of 
     the SSBIOC program to meet the equity venture capital needs 
     of socially or economically disadvantaged small business 
     concerns, the problems affecting the program, and the 
     effectiveness of SBA's administration of the SSBIC program.
       The Conferees support the stated direction of this Council 
     and direct the Council to submit its recommendations and 
     report to the House and Senate Committees on Small Business 
     no later than May 31, 1995.

                           U.S. Small Business Administration,

                               Washington, DC, September 29, 1994.
       Dear Mr. Chairman: As you know, the SBA is currently in the 
     process of reviewing all of our finance programs. As part of 
     this process, we are forming a Specialized Small Business 
     Investment Company (SSBIC) Advisory Council that would be 
     similar to the Small Business Investment Companies (SBIC) 
     Industry Advisory Council that was formed in 1992. Such a 
     Council would suggest improvements to the SSBIC program.
       The SBA is reviewing suggestions for the membership of such 
     a Council. It would report on the debt and equity venture 
     needs of socially or economically disadvantaged small 
     business concerns and any needed Federal incentives to assist 
     the private sector to meet such needs. Further, the SBA will 
     recommend that the Council report on the history of the SSBIC 
     program in providing assistance to such concerns and the 
     impact of its assistance on the economy, as well as the 
     appropriateness and ability of the program to meet these 
     needs, problems affecting the SSBIC program, the 
     effectiveness of the program and its administration by the 
     SBA.
       In preparation for the Council's activity, the SBA has 
     contacted Professor Timothy Bates of Wayne State University, 
     who is best known for his landmark book ``Banking on Black 
     Enterprise: The Potential of Emerging Firms for Revitalizing 
     Urban Economics.'' We expect shortly to issue a 7(j) award to 
     Wayne State University for Professor Bates to conduct 
     background studies and make recommendations for consideration 
     by the Council.
       The SBA expects the Council to be named and operational 
     within 60 days, and expects its review and suggestions to be 
     wide-ranging. Structurally, the SBA believes the Council can 
     best operate as an independent body, with staff support from 
     the Agency. In this way, we expect it will best meet the 
     objectives which prompted the House to recommend its 
     formation.
           Yours sincerely,
                                              Cassandra M. Pulley,
                                             Deputy Administrator.
     Establishment of Size Standards (Sec. 301)
       The Senate bill contained a provision (Sec. 301) that 
     clarified Section 3 of the Small Business Act regarding the 
     establishment of size standards for determining whether a 
     business concern is a small business concern.
       The House amendment (Sec. 301) contained a similar 
     provision.
       The Senate recedes with a technical amendment.
     Pilot Preferred Surety Bond Guarantee Program Extension (Sec. 
         302)
       The Senate bill contained a provision (Sec. 302) that would 
     extend the termination date of the pilot Preferred Surety 
     Bond Guarantee Program from September 30, 1994 to September 
     30, 1995, a one year extension.
       The House amendment contained a three-year extension of the 
     Preferred Surety Bond Guarantee (SBG) Program.
       The House recedes.
       The Conference Agreement adopts the Senate provisions, 
     providing only for a one-year extension of the Preferred SBG 
     Program to provide time to review the performance of the 
     Program in light of the matters described in the report 
     accompanying the Senate bill (S.Rpt. 103-332).
       The Conferees also note that the SBA's programs which help 
     small business concerns to obtain access to surety bonding 
     will need to be fully reviewed because of recent major 
     statutory changes relating to Federal procurement policy and 
     regulatory changes pertaining to the SBG Program. In addition 
     to the Preferred Surety Bond Guarantee Program, SBA operates 
     the Regular or Prior-Approval SBG Program.
       First, the ``Federal Acquisition Streamlining Act of 1994'' 
     (S. 1587), recently passed by Congress, increases from 
     $25,000 to $100,000 the threshold for the application of the 
     Miller Act, which requires the contractor to furnish a 
     performance bond and payment bond on any Federal construction 
     contract covered by the Act. Based on SBA data for Fiscal 
     Year 1993, the average dollar value of a contract receiving 
     surety bonds guaranteed through the SBA SBG Program was 
     $136,114. The Miller Act threshold increase will make 
     available substantial amounts of the SBG Program's resources 
     towards larger contracts if certain statutory program changes 
     are made. For example, the current statutory limitation on 
     the size of a contract eligible for an SBA guaranteed bond 
     could be substantially increased from the $1.25 million cap 
     established in 1986. Larger contracts are becoming 
     increasingly common as Federal procuring agencies consolidate 
     or ``bundle'' requirements to reduce the number of contracts 
     to administer. In Fiscal Year 1993, approximately 65 percent 
     of the dollars awarded by Federal agencies for construction 
     contracts were awarded through contracts in excess of $1 
     million.
       Second, on June 21, 1994, the SBA increased the size 
     standard for participation in the SBG Program from $3.5 
     million in average annual gross receipts to $5.0 million. 
     This new size standard is still well below the otherwise 
     applicable $17 million size standard for general contractors 
     and the $7 million size standard for so-called specialty 
     contractors (e.g., excavation, masonry, and electrical) who 
     generally operate as subcontractors. SBA estimates that the 
     increased size standard for SBG Program eligibility will make 
     approximately 11,000 firms eligible for SBA assistance in 
     obtaining access to surety bonding. These small businesses 
     will now be able to more readily obtain the surety bonding 
     they must have to even compete for these larger Federal 
     contracting opportunities.
     Manufacturing Contracts Through Manufacturing Application and 
         Education Centers (Sec. 303)
       The Senate bill contained a provision (Sec. 303) to promote 
     access to Federal contracting opportunities requiring 
     manufacturing for small business concerns participating in 
     Manufacturing Application and Education Centers (MAECs). The 
     Senate provision directs the SBA to work with the Department 
     of Commerce and other Federal agencies to identify 
     contracting opportunities for manufactured products, 
     especially subsystems or components that are currently 
     obtained from foreign sources. The Senate provision expires 
     on September 30, 1994.
       The House amendment (Sec. 705) contained a provision 
     requiring the SBA to establish a Manufacturing Modernization 
     Pilot Program to assist small business participating in MAECs 
     by promoting the identification and award of contracting 
     opportunities for certain manufactured products to such 
     firms. The program was authorized through September 30, 1999.
       Under the provisions of the House amendment, the SBA could 
     certify existing MAECs as eligible to furnish assistance to 
     small business concerns or establish additional MAECs. In 
     establishing new centers, the House provisions directed that 
     SBA rely on the model of existing MAECs and enumerated the 
     types of technology assistance to be provided.
       The House provision also charged SBA, working with the 
     various Federal agencies, to identify contracting 
     opportunities for manufactured products, particularly 
     critical items or those being procured from foreign sources, 
     and to urge the award of such contracts through contract 
     competitions restricted to small business concerns pursuant 
     to section 15(a) of the Small Business Act. In performing 
     such a contracting opportunity at a MAEC, small business 
     contractor would be freed of the limitations on 
     subcontracting otherwise required by section 15(o)(1)(B).
       The House provision contained an unspecified authorization 
     of appropriations for the new pilot program.
       The House recedes with an amendment.
       The Conference Agreement adopts the provision of the Senate 
     bill with the addition of the authorization for 
     appropriations from the House amendment. The Conference 
     Agreement does not require SBA to initiate a new program, to 
     establish any new MAECs, or to certify any existing MAECs.
       It is the intent of the conferees for the SBA to utilize 
     the authority provided by this section, with its established 
     programs, to support the adoption and deployment of advanced 
     manufacturing technologies and practices by small business 
     concerns participating in MAECs. The SBA Administrator, the 
     Under Secretary of Commerce for Export Administration, and 
     the heads of the procuring agencies shall jointly seek to 
     identify contracting opportunities with an aggregate value of 
     not more than $10 million dollars for performance by small 
     manufacturers at each MAEC.
       The Conferees recommend that the SBA work with the National 
     Center for Manufacturing Sciences (NCMS) to conduct a set of 
     pilot demonstrations with NCMS-affiliated MAECs operating in 
     Oregon, Arkansas, Ohio, Missouri, New York, West Virginia, 
     and other states.
       MAECs often operate as a consortium of resource partners. 
     One notable example is the Oregon Advanced Technology 
     Consortium (OATC), a network of 12 community colleges which 
     operates a teaching factory which focus on precision metal 
     fabrication, teaching participants how to implement new 
     manufacturing technologies.
     Pilot Program for Very Small Business Concerns (Sec. 304)
       The House amendment contained a provision (Sec. 304) 
     establishing a pilot program to expand the participation of 
     very small business (VSB) in Federal contracting 
     opportunities. The House provision defined a very small 
     business as a small business concern with: (a) 10 or fewer 
     employees; or (b) average annual gross receipts of $1 million 
     or less. The House provision, modeled after the preferential 
     contracting authority of section 8(a) of the Small Business 
     Act, called for SBA to identify Federal contracting 
     opportunities suitable for award under the new program, enter 
     into a contract with the Federal agency having the 
     contracting opportunity, and then subcontract performance, 
     after conducting a competition restricted to VSBs. The House 
     provision also called for SBA to provide VSBs participating 
     in the contracting program with: (a) business development 
     assistance ``in the same manner and to the same extent'' as 
     such assistance is provided, pursuant to section 7(j) of the 
     Act, to small business concerns owned and controlled by 
     socially and economically disadvantaged individuals; and (b) 
     pre-qualification for financial assistance authorized by 
     section 7(a) of the Act. The pilot program was authorized for 
     a three-year period; Fiscal Year 1995 through Fiscal Year 
     1997.
       The Senate bill contained no similar provision.
       The Senate recedes with an amendment.
       The Conference Agreement authorizes the establishment of a 
     Pilot Program for Very Small Business Concerns. Under the 
     Conference Agreement, a very small business is a small 
     business concern with: (a) 15 or fewer employees; and (b) 
     averages annual gross receipts of $1 million or less.
       The Conference Agreement contemplates the identification of 
     suitable contracting opportunities by SBA working with the 
     various procuring agencies, the conduct of competitions 
     restricted to VSBs, and contract award by the agency having 
     the contracting opportunity. Otherwise, the Conference 
     Agreement leaves to SBA to specify in regulations the 
     operating details of the program.
       The Conferees note that the Pilot Program does not 
     establish a new goal for the participation of VSBs in Federal 
     contracting. Contracts awarded to VSBs will be counted toward 
     the appropriate goals established pursuant to section 15(g) 
     of the Act, depending on the status of the VSB. Moreover, the 
     Conferees expect SBA to ensure that the Pilot Procurement 
     Program for VSBs does not detract from or conflict with 
     existing contract assistance programs for small business 
     concerns owned and controlled by socially and economically 
     disadvantaged individuals, including contract awards pursuant 
     to section 8(a) of the Act, and the various statutory 
     authorities restricting competitions to such small business 
     concerns (e.g., DOD's Small Disadvantaged Business Program, 
     10 U.S.C. 2323).
       Public participation in the program formulation process is 
     assured by providing a timetable for the issuance of proposed 
     and final regulations. The Conferees expect that SBA will 
     afford at least 60 days for public comment on the proposal.
       Although the Conference Agreement leaves the program's 
     operating details to SBA, the Conferees explicitly rejected 
     the use of the three-party, prime contract-subcontract 
     process currently used in the award of contracts pursuant to 
     section 8(a) of the Act. The Conferees also made explicit 
     that the status of a small business concern as a VSB would be 
     accomplished by self-certification, subject to a size protest 
     under existing regulations and procedures.
       Finally, the Conference Agreement limits the scope of the 
     Program to implementation in at least 5 but not more than 10 
     SBA districts. It does, however, extend the Program's 
     duration until September 30, 1998 to: (a) afford SBA adequate 
     time to formulate proposed program regulations, a 60-day 
     public comment period, and time to fashion final regulations 
     in response to those comments; (b) permit approximately two 
     and one-half years of experience under the Program; and (c) 
     afford Congress adequate time to consider the required report 
     from SBA on the Program (which is due by April 30, 1997), 
     hold hearings, and, if appropriate, consider legislation 
     relating to the Program.
     Handicapped Workshop Participation in Small Business Set-
         Aside Contracts (Sec. 305)
       The House amendment (Sec. 701) contained a provision 
     amending section 15(c) of the Small Business Act reinstating 
     an expired five-year test program permitting public or 
     private organizations for the handicapped (as defined in 
     section 3(e) of the Small Business Act) to be eligible to 
     compete for Federal contracting opportunities ``set-aside'' 
     for competition among for-profit small business concerns 
     under the authority of section 15. The House amendment would 
     have made permanent the authority for the participation of 
     these organizations. Under the House amendment, the aggregate 
     dollar value of contract awards to such organization under 
     the authority of section 15(c) would be $50 million per year.
       The Senate bill contained no similar provision.
       The Senate recedes with an amendment.
       Under the Conference Agreement, the authority provided by 
     section 15(c) is reinstated for Fiscal Year 1995. Aggregate 
     awards under such authority are limited to $40 million.
       The Conferees note that the authority for handicapped 
     workshops to participate in contract opportunities restricted 
     to small business competitions lapsed after the conclusion of 
     the five-year test. The one-year reinstatement of the 
     authority will permit an opportunity for further evaluation 
     by the Congress.

              TITLE III--LEGISLATIVE PROVISION NOT ADOPTED

     Competitive Demonstration Project Size Standards
       The House amendment contained a provision (Sec. 301) that 
     repealed that portion of section 732 of the ``Small Business 
     Competitiveness Demonstration Program Act of 1988'' (Title 
     VII of Public Law 100-656) that prohibited the changing of 
     size standards for the SIC (standard industrial 
     classification) Codes pertaining to the four designated 
     industry groups covered by the Competitiveness Demonstration 
     Program. The designated industry groups are: construction 
     (other than dredging); architect-engineering services; refuse 
     systems and related services; and non-nuclear ship repair.
       The Senate bill contained no similar provision.
       The House recedes.
       While noting that the SBA published revised size standards 
     for essentially all other SIC Codes on April 7, 1994 
     (generally reflecting upward adjustments for inflation), the 
     Conferees agreed that validity of the data collected by the 
     participating Federal agencies (since January 1, 1989) and 
     analyzed in annuals report to the Congress by the Office of 
     Federal Procurement Policy would lose its comparability if 
     the size standards for the four designated industry groups 
     were modified during the term of the program (which expires 
     on September 30, 1996).

               TITLE IV: BUSINESS DEVELOPMENT ASSISTANCE

                     Subtitle A--General Provisions

     Sec. 401. Sunset on cosponsored training
       The Senate bill extended SBA's authority to enter into 
     cosponsorship agreements with for-profit concerns to 
     September 30, 1997.
       The House amendment contained a similar provision.
       The conference agreement retains this provision.
     Sec. 402. Small business development center program level
       The Senate bill provided for an increase in the minimum 
     grant to an small business development center (SBDC) from 
     $200,000 to $300,000 beginning in fiscal year 1996. It also 
     provided an increase from $100,000 to $200,000, beginning in 
     fiscal year 1996, in the additional funding increment to 
     which SBDC is entitled annually. The Senate bill also 
     provided that the increases would not take effect if 
     insufficient appropriations were made available in fiscal 
     year 1996 or any year thereafter. Finally, the Senate bill 
     increased the authorization for the SBDC national program, 
     which does not include the additional funding increments, to 
     $70 million in fiscal year 1995, $77.5 million in fiscal year 
     1996, and $85 million in fiscal year 1997.
       The House amendment contained a provision which retained 
     the existing floor of $200,000, but increased the additional 
     funding increment from $100,000 to $125,000 beginning in 
     fiscal year 1995.
       The House amendment also contained increased funding levels 
     for the national program.
       The conferees agreed to eliminate the minimum grant and 
     increase the additional funding increment to $125,000 in 
     fiscal year 1995 and to $200,000 thereafter. The conferees 
     eliminated the provision of the Senate bill which would 
     retain existing funding levels if insufficient appropriations 
     were made in any fiscal year. The conference substitute also 
     increases the national program but delays its implementation 
     by one year to phase in the demand for increased 
     appropriations. The conferees set the national program level 
     at $70 million in fiscal years 1995-96, $77.5 million in 
     fiscal year 1997 and $85 million in fiscal year 1998.
     Sec. 403. Federal contracts with small business development 
         centers
       The Senate bill allowed Small Business Development Centers 
     to enter into agreements with federal agencies other than SBA 
     to provide services to small business concerns, provided that 
     such agreements are approved by SBA and not inconsistent with 
     the SBDC's mission. It further provided that federal 
     contractual arrangements with SBDCs do not count toward an 
     agency's small and minority business goals.
       The House amendment contained a similar provision.
       The conference agreement retains this provision and also 
     clarifies that such arrangements are not subject to the usual 
     program matching requirements.
     Sec. 404. Small business development center program 
         examination and certification
       The Senate bill provided for biennial review of Small 
     Business Development Centers by SBA in place of the current 
     ``on-site review'' process, and also provided for SBA to 
     support the Association of Small Business Development Center 
     Directors to develop parameters for a certification program.
       The House amendment contained no similar provision.
       The conference agreement retains the Senate provision.
     Sec. 405. Central European small business development
       The House amendment provided for an extension of authority 
     for the Central European Commission through the end of fiscal 
     1995.
       The Senate bill contained no similar provision.
       The conference agreement retains the House provision.
     Sec. 406. Mobile resource center pilot program
       The House amendment allows SBA to create a Mobile Resources 
     Center pilot program to provide outreach and expanded access 
     to SBA programs in underserved areas.
       The Senate bill contained no such provision.
       The conference agreement allows for a three-year pilot 
     program using not more than four mobile resource vehicles, 
     two of which shall be in urban areas and two in rural areas. 
     The program is subject to appropriations.
     Sec. 407. Information concerning franchising
       The Senate bill contained an amendment requiring SBA to 
     provide information on the risks and benefits of franchising 
     to small business clients.
       The House amendment contained no similar provision.
       The conference agreement retains the Senate provision.
     Subtitle B--Development of Women-Owned Businesses
     Sec. 411. Extension of authority for demonstration projects
       Both the Senate bill and the House amendment contained 
     identical language extending the authority for women's 
     demonstration project grants from 1995 to 1997.
       The conference agreement includes the provision.
     Sec. 412. Establishment of Office of Women's Business 
         Ownership
       The Senate bill and the House amendment contained almost 
     identical provisions authorizing the establishment of an 
     Office of Women's Business Ownership within the Small 
     Business Administration. The Senate bill requires that the 
     office, like other SBA offices of comparable stature, be 
     headed by an Assistant Administrator. The House amendment 
     requires that a director head the office.
       The conference agreement adopts the House amendment with an 
     amendment to reflect that the head of the new Office of 
     Women's Business Ownership is to be an Assistant 
     Administrator.
     Sec. 413. Development of Women's business enterprise
     Sec. 414. Transition reimbursement
     Sec. 415. Gift authority
     Sec. 416. Conforming amendment
       Although both the Senate bill and the House amendment 
     contained new structures for the current National Women's 
     Business Council, the proposals differed substantially. The 
     Senate bill created a new body comprised of 14 members from 
     both the public and private sectors. The House amendment 
     created both a 15-member private sector council and a 17-
     member Interagency Committee. The conference adopts the 
     structure from the House amendment and incorporates 
     additional amendments addressing the Senate's concerns about 
     the size and scope of the new entities.
       The Conference Agreement establishes an Interagency 
     Committee on Women's Business Enterprise (Committee) and 
     restructures the National Women's Business Council. The 
     Conferees prefer the creation of the Committee and a revision 
     of the Council to a mere extension of the Council because the 
     public structure of the Committee coupled with a private 
     sector advisory function is a more effective way to address 
     the priority issues facing women business owners.
       The Interagency Committee will include high ranking policy-
     making officials from the following: the Departments of 
     Commerce, Defense, Health and Human Services, Labor, Small 
     Business Administration, Transportation, Treasury, the 
     General Services Administration, the Federal Reserve, and the 
     Executive staff of the President. The Assistant Administrator 
     of the Small Business Administration Office of Women's 
     Business Ownership shall represent the Small Business 
     Administration and serve as the Vice-Chairperson of the 
     Committee. Within 45 days of enactment of this title, the 
     President, in consultation with the Administrator of the 
     Small Business Administration, is required to appoint the 
     Committee Chairperson from among members of the Committee.
       The Committee's duties include the promotion of women's 
     business ownership in the public sector, women-owned 
     businesses' access to credit and capital, and assistance with 
     data collection on women-owned businesses. The Committee is 
     responsible for the annual submission of a report to Congress 
     outlining its activities and recommendations concerning 
     women's business ownership.
       The Interagency Committee on Women's Business Enterprise is 
     authorized until September 30, 1997.
       The Conference agreement also revises the National Women's 
     Business Council to be comprised of 9 members appointed by 
     the Administrator of the Small Business Administration, in 
     consultation with the Assistant Administrator of the Office 
     of Women's Business Ownership. Such appointments must be 
     completed within 60 days of the enactment of this title. Of 
     the 9 members four will be owners of small businesses who are 
     representative of both political parties and five shall be 
     representatives of national women's business organizations. 
     In making the appointments, the Administrator shall consider 
     suggestions as to possible candidates who meet the defined 
     statutory criteria submitted by House and Senate majority and 
     minority leadership, in consultation with the Small Business 
     Committee members. In addition, within 45 days of enactment 
     of this title, the President is required, in consultation 
     with the Administrator of the Small Business Administration, 
     to appoint a prominent businesswoman to be the Chairperson of 
     the Council.
       The Council's investigative and reporting duties include 
     reviewing, promoting and coordinating women-owned businesses' 
     access to credit and capital, and their development and 
     growth in both the public and private sectors. The Council is 
     also charged with assisting with data collection on women-
     owned businesses. The Council will meet periodically and 
     serve as a truly independent, objective and bi-partisan 
     source of advice and policy recommendations for the 
     Interagency Committee, the President, and the Congress.
       To facilitate the Council's duties, the Administrator of 
     the Small Business Administration, in consultation with the 
     Chairperson of the Council, shall appoint an Executive 
     Director. The Chairperson, upon the recommendation of the 
     executive director, may appoint as necessary, and as funds 
     allow, up to four additional employees.
       The National Women's Business Council is authorized until 
     September 30, 1997. Authorization levels are $350,000 in 
     fiscal years 1995, 1996, and 1997. It is the intent of the 
     Conferees that authorized funds be used solely for the 
     purpose of carrying out the responsibilities of the National 
     Women's Business Council pursuant to sections 405-407 of the 
     Women's Business Ownership Act of 1988. It is assumed that 
     Interagency Committee members will use the resources of the 
     agency from which they come to carry out the Committee's 
     responsibilities. Due to the Conferees' recognition of 
     limited appropriated funds, the Conferees have provided the 
     Council with authority to receive contributions from for-
     profit and non-profit entities through the Small Business 
     Administration's gift authority under Section 8(b) of the 
     Small Business Act. The Council is responsible for expending 
     any funds which it receives either through appropriations or 
     by donations in the most economical manner possible.
       In order to ensure a smooth transition from the former 
     National Women's Business council, the conferees have 
     provided the Administration the authority to approve 
     reimbursement for transition activities by key personnel 
     associated with the Council, namely the Chairperson, the 
     Executive Director and key staff. All transition activities 
     must be completed within 90 days of enactment of this title. 
     Funds required for reimbursement shall be expended from 
     fiscal year 1995 appropriations.


                    Measure not included in Title IV

       The Senate bill contained an amendment requiring the 
     Service Corps of Retired Executives (SCORE) to work with the 
     Corporation for National and Community Service and the Points 
     of Light Foundation.
       The House amendment deletes this provision.
       The Senate recedes to the House amendment.

          TITLE V: RELIEF FROM DEBENTURE PREPAYMENT PENALTIES

     Sec. 501. Short Title
       This title may be referred to as the Small Business 
     Prepayment Penalty Relief Act of 1994.
     Sec. 502. Prepayment of development company debentures
       The House amendment provided for the use of appropriated 
     funds to reduce the interest rate on outstanding debentures 
     issued by Certified Development Companies, Small Business 
     Investment Companies and Specialized Small Business 
     Investment Companies which were purchased by the Federal 
     Financing Bank in the early to mid-1980s. These debentures 
     carry extremely high interest rates by today's standards. 
     Many borrowers would like to prepay or refinance their loans 
     but have been precluded from doing so by harsh penalty 
     clauses contained in the debentures. The House amendment 
     would have permitted relief only for loans bearing an 
     interest rate of 10.3% and higher.
       The Senate bill established a different scheme for 
     prepayment penalty relief using both appropriated funds and a 
     refinancing premium paid by borrowers. Relief was limited to 
     Certified Development Company borrowers, and a sliding scale 
     was established governing the refinancing premium which 
     varied from 9.5 percent to 11.5 percent depending on the 
     original length of the loan.
       The Conference agreement resolves this long-standing 
     problem by adopting a substitute similar to the Senate plan 
     but including both regular and Specialized Small Business 
     Investment Companies among those eligible for relief. The 
     conferees intend that SBICs and SSBICs be treated essentially 
     the same as Sec. 503 borrowers. The conferees modified the 
     refinancing premiums in the Senate bill in two ways. First, 
     ten-year loans are pegged at an 8.5% refinancing premium 
     rather than the Senate's 9.5%. Second, the Administration is 
     required to raise or lower the pegged rates as needed to 
     ensure that when the premiums collected are added to the $30 
     million appropriated, there is no loss to the Federal 
     Financing Bank.
       The Conferees are concerned that the plan as implemented 
     must make relief available to all eligible borrowers. To 
     accomplish this aim, the Administration is directed to notify 
     borrowers of the terms and conditions of the program, 
     including the potential range of refinancing premiums which 
     may be required of that borrower depending on the length of 
     the original loan. The Administration shall establish a 
     period of not less than 45 days during which interested 
     borrowers must register their intent to participate in the 
     program. The Administration shall require an ``earnest 
     money'' deposit of $1000 from those choosing to participate. 
     This deposit is non-refundable but will be credited toward 
     the finally determined refinancing premium. The final premium 
     will be set by the Administration based on the statute's 
     pegged rates for differing length loans, as adjusted in order 
     to compensate for the number of actual participatants.
       The Appropriations Committee has provided $30 million to 
     cover the cost of this program in the 1995 appropriations 
     measure for the Departments of Commerce, Justice, State, and 
     Judiciary and Related Agencies (Pub. L. 103-317). Amounts 
     collected from borrowers in the form of repurchases premiums 
     will supplement this amount as necessary in order to make the 
     program essentially revenue neutral. If a small number of 
     borrowers elect to participate, the repurchase premiums will 
     be less than the peg rates, while a large number of 
     participants will require the peg rates to be increased. The 
     peg rates were established based on staff estimates that 
     approximately 75% of borrowers might be expected to 
     participate. The conference agreement makes clear that all 
     eligible borrowers may participate if they notify SBA of 
     their intent to do so within the time frame provided for such 
     purpose. The Conferees also expect that all who elect to 
     participate will be treated equitably by the Administration. 
     Moreover, if amounts finally collected, together with the 
     appropriated funds, exceed revenue neutrality, the excess 
     funds should be deemed to be excess private funding and 
     should be refunded to borrowers.
       The conference agreement makes clear that borrowers under 
     the former Sec. 503 program may refinance their loans under 
     the Sec. 504 program and that all costs of refinancing, 
     including the refinancing premium, may be included in the new 
     504 debenture. Moreover, the job creation requirement usually 
     applicable to the 504 program is waived for Sec. 503 
     refinancings. Borrowers under the SBIC or SSBIC programs will 
     be permitted to prepay under the terms set forth in this 
     title and to roll their debentures over under the rules 
     otherwise applicable under each program.

                   TITLE VI: MISCELLANEOUS AMENDMENTS

     Sec. 601. SBA interest payments to Treasury
       The Senate bill provided for the consolidation of several 
     SBA accounts in the Treasury and modified the calculation of 
     interest payments by SBA to the Treasury. Section 702 of the 
     House bill did not provide for the consolidation of accounts 
     but did provide for the change in interest payments. The 
     conferees deleted the Senate provision for consolidation of 
     accounts and adopted the joint provision concerning interest 
     payments to allow SBA to simply pass on to the Treasury the 
     amount of interest it collects from its borrowers.
     Sec. 602. Imposition of fees
       The Senate bill allowed for SBA to impose and collect user 
     fees for loan servicing actions and for publications. Section 
     703 of the House amendment provided for similar fees up to a 
     level of $100 rather than $300 in the Senate bill. The 
     conference agreement allows for fees in connection with loan 
     servicing actions not to exceed $100, except for loan 
     assumption where fees may be as much as $300. Fees collected 
     by the Administration and by fiscal and transfer agents may 
     be retained by the Agency and used to support the operation 
     of loan programs.
       Additionally, the conferees expressly approved the 
     collection of a fee not to exceed one percent for the 
     issuance of ``forward funding commitments'' for SBIC and 
     SSBIC financings.
     Sec. 603. Job creation and community benefit
       The Senate bill directed SBA to consider the job creation 
     and retention aspects of proposals for financing under the 
     new defense conversion loan program authorized by Sec. 
     7(a)(21). The House bill contained no similar provision. The 
     conferees adopted the Senate provision.
     Sec. 604. Microloan program amendments
       The Senate bill expand the category of entities with whom 
     SBA may contract in order to provide training and support for 
     microloan intermediary organizations to include national and 
     regional organizations with experience in providing training 
     and support for microenterprise development and financing.
       The House bill contained no similar provision.
       The conferees adopted the Senate provision. The provision 
     is intended to encourage SBA to expand its efforts to 
     provides information, training and outreach to organizations 
     which may be suitable for participation in the microloan 
     pilot program. The conferees are concerned that some areas of 
     the country remain unserved by any microloan intermediary. 
     SBA is directed to move aggressively to establish nationwide 
     coverage and to give priority to financially underserved 
     areas. At the same time, it is important that SBA maintain 
     the program's emphasis on quality business training which 
     must be provided by intermediaries to all microloan borrowers 
     if the program it to fulfill its intended purposes of 
     economic opportunity for people who have little opportunity 
     or access to credit otherwise.
     Sec. 605. Technical clarifications
       The Senate bill clarifies that loans made under Sec. 
     7(a)(21) are loan guarantees rather than direct loans, and 
     also clarifies the scope of duties for employees of the 
     Office of Advocacy. The House bill contained no similar 
     provision. The conferees adopted the Senate provision.
       The Senate bill also amended the due date for a report 
     concerning the secondary market in SBA loans. Since the 
     report has been completed, this provision was deleted by the 
     conferees.
     Sec. 606. Study and data base: guaranteed business loan 
         program and development company program
       The Senate bill required a comprehensive report on the 
     economic impact of the Sec. 7(a) and 504 programs.
       The House bill contained no similar provision.
       The conferees adopted the Senate provision which is similar 
     to language contained in the 1995 appropriations bill and 
     report for SBA. The conferees intend that SBA follow up, to 
     the extent practicable, on the results of the Price-
     Waterhouse evaluation of the 7(a) program released in 1991. 
     Data used for that report is now several years old.
       Congress, the President and the public need to know whether 
     these programs represent sound investments of the taxpayers' 
     dollars in terms of jobs created or retained and taxes paid 
     by firms receiving SBA assistance. SBA is urged to complete 
     this report in the most timely fashion possible consistent 
     with quality and reliability of data. Outside contractors may 
     be used as needed, as well as in-house resources of the 
     Office of Advocacy or other government agencies.
       The Conferees wish to make clear that as to factor number 
     eight (Sec. 606(b)(8)), ``taxes paid by businesses which 
     received the loans or financings under each program'', the 
     Conferees expect, to the greatest extent practicable, that 
     the Administration will include within the definition of 
     ``taxes paid,'' all applicable Federal taxes withheld by a 
     business on behalf of its employees. In other words, the 
     phrase ``taxes paid by businesses'' is to include, if such 
     figures are easily obtainable, taxes owed by individuals 
     employed by such businesses as the result of their 
     employment.
     Sec. 607. SBIR vendors
       The Senate bill contained a provision that extended from 
     one year to three years the maximum term for contracts under 
     which private sector vendors provide technical assistance to 
     recipients of awards under the Small Business Innovation 
     Research (SBIR) Program, pursuant to section 9(q) of the 
     Small Business Act.
       The House amendment (Sec. 608) contained an identical 
     provision.
       The Conference Agreement includes this provision.
     Sec. 608. Program extension
       The Senate bill extended the authority of Native American 
     tribes to enter into joint ventures with firms certified 
     under the Sec. 8(a) program, a business development program 
     for firms owned by socially or economically disadvantaged 
     individuals. The House bill contained no similar provision. 
     The conferees adopted a provision extending the current joint 
     venture authority for three years.
     Sec. 609. Prohibition on the use of funds for individuals not 
         lawfully within the United States
       Both bills and the conference agreement prohibited SBA 
     financial assistance to individuals who are known by SBA to 
     be illegal aliens.
     Sec. 610. Office of Advocacy Employees
       The Senate bill modifies the authority of the Chief Counsel 
     for Advocacy to hire the employees provided for under 15 
     U.S.C. 634d by eliminating the requirement that the Chief 
     Counsel obtain the approval of the SBA Administrator. In 
     addition, the Senate bill provided the Chief Counsel an 
     increase of four employees in the personnel ceiling of the 
     Office of Advocacy. Such employees are to be compensated at a 
     rate not in excess of GS-15, step 10.
       The House amendment contained a similar provision and 
     receded to the Senate provision.
     Sec. 611. Prohibition on the provision of assistance
       The Senate bill prohibits the Administration from providing 
     assistance to businesses engaged in the production and 
     distribution of obscene products and services. This section 
     was written in response to the recent repeal of SBA's 
     ``opinion molder rule''. With the repeal of the rule, 
     businesses such as newspapers, movie theaters, radio stations 
     and bookstores now are eligible for SBA assistance. This 
     means businesses involved in the production and distribution 
     of obscene products and services also could seek 
     Administration support. This section makes clear that the 
     Administration is not authorized to provide any assistance to 
     those engaged in any class of ``obscene'' business as defined 
     by the U.S. Supreme Court (and thus not entitled to First 
     Amendment protection). The section is intended to cover the 
     narrow range of adult theme businesses, including adult book 
     stores, adult theaters, adult film and video producers, and 
     adult film and video distributors. It is not meant to apply 
     to businesses such as convenience stores carrying adult 
     materials that do not fall within the Supreme Court's 
     definition of obscenity.
       The House bill had no similar provision.
       The conferees adopted the Senate provision with a 
     clarification that any materials in question must have been 
     judicially determined, in either a civil or criminal action, 
     to be legally obscene under prevailing constitutional 
     standards in order for the ban to apply.
     Sec. 612. Certification of compliance with child support 
         obligations
       Both bills contained provisions requiring SBA borrowers to 
     certify that they are not in violation of any court order or 
     agreement requiring the payment of child support. The 
     conference report contains the same provision with a 
     clarification that the prohibition refers to a substantial 
     non-compliance with court orders, administrative orders, or 
     agreements, specifically 60 days or more in arrears.
       While intending to strengthen federal policy in support of 
     family support obligations, the conferees recognize that 
     economic circumstances may from time to time cause a parent 
     to be late in such payments. It is not the intent of the 
     conferees to subject minor lapses to the severe criminal and 
     civil penalties contained in both the Small Business Act and 
     the False Statements Act for false representations made to 
     the agency in the course of a loan application or other 
     application for assistance. Hence, the conference agreement 
     provides for a certification that the applicant is not more 
     than 60 days late in making any child support payment 
     required by court order or agreement. Loan applicants should 
     be advised of this provision at the outset of the application 
     process, but certification pursuant to this section may be 
     made as part of the loan closing.
     Sec. 613. Advocacy study of paperwork and tax impact
       The House amendment contained a provision (sec. 708) that 
     would require the Chief Counsel for Advocacy of the Small 
     Business Administration (SBA) to conduct a comprehensive 
     study of the impact of all Federal regulatory, paperwork and 
     tax requirements on small business. State and local 
     regulations, paperwork or tax burdens are not within the 
     scope of this study.
       Under this provision, the Chief Counsel for Advocacy must 
     report the findings of this comprehensive study to Congress 
     within one year of the enactment of this provision. One of 
     the primary responsibilities of the Office of Advocacy of the 
     SBA is to interface with all Federal regulatory agencies 
     during the rulemaking process. Another responsibility of the 
     Office of Advocacy is to serve as an Ombudsman for the 
     interests of small business throughout the Federal 
     government. The study required by the provision will greatly 
     assist the Office of Advocacy in fulfilling its mission.
       The Senate bill contained no similar provision, and receded 
     to the House amendment.
     John J. LaFalce,
     Neal Smith,
     Ron Wyden,
     Jan Meyers,
     Richard H. Baker,
                                Managers on the part of the House.

     Dale Bumpers,
     Sam Nunn,
     Larry Pressler,
     Managers on the part of the Senate.

                          ____________________