[Congressional Record Volume 143, Number 118 (Tuesday, September 9, 1997)]
[Senate]
[Pages S8971-S8989]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




               SMALL BUSINESS REAUTHORIZATION ACT OF 1997

  Mr. BOND. Mr. President, with sincere thanks to my colleague from 
Washington, I ask unanimous consent that the Senate proceed to the 
consideration of S. 1139.
  The PRESIDING OFFICER. The clerk will report.
  The assistant legislative clerk read as follows:

       A bill (S. 1139) to reauthorize the programs of the Small 
     Business Administration, and for other purposes.

  The PRESIDING OFFICER. Is there objection to the immediate 
consideration of the bill?
  There being no objection, the Senate proceeded to consider the bill.


                           Amendment No. 1124

  Mr. BOND. Mr. President, on behalf of myself and Senator Kerry, I 
have an amendment at the desk, and I ask for its consideration.
  The PRESIDING OFFICER. The clerk will report.
  The assistant legislative clerk read as follows:

       The Senator from Mr. Missouri [Mr. Bond], for himself and 
     Mr. Kerry, proposes an amendment numbered 1124.

  Mr. BOND. Mr. President, I ask unanimous consent that the reading of 
the amendment be dispensed with.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  (The text of the amendment is located in today's Record under 
``Amendments Submitted.'')
  Mr. BOND. Mr. President, I rise today in support of S. 1139, the 
Small Business Reauthorization Act of 1997. This bill is the product of 
the hard work of the members of the Committee on Small Business. In 
particular, Senator John Kerry, the committee's ranking member, has 
been extremely helpful and supportive in our joint efforts to produce 
this legislation.
  The Small Business Reauthorization Act of 1997 reauthorizes most of 
the credit and noncredit programs at the Small Business Administration. 
On June 26, 1997, the committee conducted a markup of this bill and 
voted 18 to 0 to report the bill favorably to the full Senate.
  In addition to reauthorizing the SBA programs that we are most 
familiar with, S. 1139 addresses two significant issues: Federal 
contract bundling and the HUBZone Program.
  The bundling of Federal Government contracts requirements is a trend 
that is increasing in the Federal procurement system. Small business 
owners have testified before the Committee on Small Business about the 
negative impact contract bundling is having on their ability to bid on 
Government contracts. The manager's amendment to the bill includes an 
amended version of the contract bundling section that was worked out in 
close consultation with Senator Thompson and Senator Glenn, the 
chairman and ranking member of the Committee on Governmental Affairs.
  The manager's amendment clears up any misunderstanding over what is a 
bundled contract. The legislation makes clear that a bundled contract 
solicitation is one in which ``two or more procurement requirements for 
goods or services previously provided or performed under separate 
smaller contracts'' are consolidated into one larger, bundled contract. 
This language covers contracts that were previously performed by a 
small business and those that were suitable for award to small business 
concerns.
  The amended contract bundling section builds on the authority of the 
Small Business Administration to challenge a Federal agency's decision 
to consolidate or bundle two or more contracts into a large contract. 
In 1989, Congress gave specific authority to SBA's procurement center 
representatives to challenge a decision to bundle multiple contract 
actions. Importantly, under the 1989 law, the SBA Administrator was 
given the authority to appeal a decision to bundle contract actions 
directly to a Cabinet Secretary or agency head if the SBA 
representative and the contracting agency are not able to resolve their 
differences. The manager's amendment to S. 1139 adds some additional 
features and procedures, and today's legislation does not weaken or 
displace the fundamental authority of SBA.
  I thank both Senator Thompson and Senator Glenn and their staffs for 
their cooperation in helping us to address certain issues within the 
jurisdiction of the Governmental Affairs Committee relating to the 
Federal procurement system and governmentwide acquisition policy. I 
believe the contract bundling section included in the manager's 
amendment will help our efforts to be fair to small businesses by 
limiting contract bundling where it is unnecessary and unjustified.
  S. 1139 also includes the full text of S. 208, the HUBZone Act of 
1997, in the form in which it was approved by a unanimous 18 to 0 
committee vote. This initiative is designed to stimulate economic 
development in America's most disadvantaged urban and rural communities 
and make welfare to work a reality.
  The HUBZone provisions will make it easier for small businesses 
located in and hiring employees from economically distressed regions 
across the country to obtain Government contracts. The measure will 
benefit entire communities by creating meaningful incentives for small 
businesses to operate and provide employment within our Nation's most 
disadvantaged inner-city neighborhoods and rural areas.

[[Page S8972]]

  To be eligible for special Federal contract consideration, a business 
must be small, must be located in a historically underutilized business 
zone [HUBZone], and must hire not less than 35 percent of its work 
force from a HUBZone. For these distressed areas, HUBZones would result 
in the immediate infusion of sorely needed capital as more and more 
businesses--both startups and existing enterprises--relocate into 
HUBZone areas in order to improve their chances of receiving Federal 
contract awards.
  Importantly, the HUBZone Program will help accomplish an important 
objective of welfare reform by providing jobs for individuals who want 
to move from welfare to work in the very neighborhoods where many 
public aid recipients currently live.
  The Small Business Reauthorization Act of 1997 is the culmination of 
hearings held by the Committee on Small Business beginning in early 
l995, and continuing into June 1996, just prior to the committee 
markup. The bill includes new authorization ceilings for the credit 
programs, including the 7(a) Business Loan Program, the Small Business 
Investment Company [SBIC] Program, and the 504 Certified Development 
Company Program. In addition, the bill makes the Microloan Program 
permanent, while extending the guaranteed loan pilot for 3 years.

  S. 1139 will make important changes in the SBIC Program to permit 
manageable program growth while strengthening SBA's oversight of the 
program. The bill gives SBA the option to make 5 year leverage 
commitments, which would conform the program to typical investment 
strategy patterns. In addition, the bill permits SBA to use fees 
collected from SBICs for licensing and examinations to offset the 
agency's costs to perform these necessary functions.
  The bill also sets fees to be paid by borrowers and lenders under the 
504 Development Company Program. These fees are paid in lieu of 
Congress appropriating public funds to compensate for the Government's 
loss exposure as determined by the credit subsidy rate. S. 1139 
provides that the fees paid by the borrowers will be reduced should the 
credit subsidy rate decline.
  The committee's report addresses some of the operational problems 
confronting the popular 7(a) Guaranteed Business Loan Program. Since I 
became chairman of the Committee on Small Business over 2\1/2\ years 
ago, the credit subsidy rate, which determines the level of Government 
loss exposure for loans guaranteed under this program, has fluctuated 
widely. Information and calculations which determine the subsidy rate 
are often not provided to Congress, the Congressional Budget Office 
[CBO], or the public. SBA and the Office of Management and Budget must 
do a more thorough and accurate job in determining subsidy rate 
estimates. With this improved flow of documentation, CBO needs to 
become much more engaged early in the process when SBA and OMB make 
initial subsidy rate estimates in order that Congress can be assured 
that the annual estimates submitted with each fiscal year's budget 
request are accurate and reflect that best available data and 
assumptions.
  S. 1139 recognizes the growing contributions women-owned small 
businesses are making in our economy. Testimony before the Committee on 
Small Business has highlighted the importance of business loans and 
venture capital to ensure the growth of women-owned businesses. 
Additionally, testimony and evidence brought to the attention of the 
committee also indicates the failure of the Federal Government to meet 
the annual 5 percent goal for awarding prime contracts to women-owned 
small businesses. In fact, over the past 2 fiscal years, the volume of 
these contracts has decreased.
  The Small Business Reauthorization Act of 1997 strengthens the role 
of key Federal organizations that are supposed to help women business 
owners: SBA's Office of Women's Business Ownership, the National 
Women's Business Council, and the Interagency Committee on Women's 
Business Enterprise.
  The bill expands the list of Federal agencies and departments that 
serve on the Interagency Committee, and each agency's designee to the 
committee is required to report directly to the agency head on the 
committee's activities.
  The bill seeks to reinvigorate the role of the Women's Business 
Council, which is designed to advise Congress and the executive branch, 
by involving more closely the Senate and House of Representatives in 
the activities of the council. The number of members on the council is 
expanded to 14 members from 9 members, with attention placed on rural 
as well as urban representation on the council.
  Most significantly, the bill adopts the text of S. 888, the Women's 
Business Centers Act of 1997, introduced by Senator Domenici and of 
which I was a principal cosponsor, along with Senator Kerry. The bill 
increases the program authorization level for creating new Women's 
Business Centers to $8 million per year from $4 million per year. In 
addition, it will permit grantees receiving funds under the program to 
remain in the program for 5 years, an increase of two years over the 
existing program. In adopting this program, the committee recognized 
there are many states with Women's Business Center sites, and the 
expanded program is designed to give SBA the flexibility to fund sites 
in those states.
  The bill recognizes the central role played by SBA's Office of 
Women's Business Ownership in overseeing and coordinating Government 
support for women-owned small businesses. In addition to overseeing the 
expanded Women's Business Centers grant program, the OWBO and staff in 
each district and branch office within SBA serve critical roles in 
focusing on the problems confronted by women business owners.
  The bill recognizes the expanding role of the Small Business 
Development Center program by increasing its responsibilities to assist 
small businesses to understand better how to deal with regulatory 
questions and problems. In addition, the bill provides increases in the 
base funding levels for SBDCs and sets a minimum floor for Federal 
funding of $500,000 annually for each SBDC.
  S. 1139 also extends other important SBA programs, such as SCORE, 
which provides counseling opportunities for small businesses by retired 
executives, the Small Business Technology Transfer [STTR] Program, the 
Small Business Competitiveness Demonstration Program, the Preferred 
Surety Bond Program, and SBA's cosponsorship authority.
  Mr. President, this is an important bill for all our small businesses 
in the United States, and I urge my colleagues' strong support for its 
final passage.
  Mr. KERRY. Mr. President, I rise in support of the passage of the 
Small Business Reauthorization Act of 1997. With the passage of this 
bill the Senate will show its support for the very important work of 
the U.S. Small Business Administration. Each year SBA programs assist 
more than 1 million American small businesses through direct loans, 
loan guarantees, business counseling and training, and procurement 
assistance. Following a series of hearings this spring, the Committee 
on Small Business voted unanimously for the provisions contained in 
this bill on earlier this summer. There is much in this bill that we 
can all be proud of and happy to support. In addition to the continued 
support of such SBA programs as the 504 Community Development Company 
and 7(a) Guaranteed Business Loan Programs, the Committee has elevated 
the SBA's Microloan Program from demonstration to permanent status and 
introduced new provisions that will benefit small businesses: the 
HUBZone Act and the Microloan Welfare-to-Work pilot project.
  Title I includes the authorization levels for the various programs 
being reauthorized in this bill. Title II addresses the Microloan, 
Small Business Investment Company, and Certified Development Company 
programs. Title III deals with a very important sector of small 
businesses, women's business enterprises. Included in this section is a 
provision increasing the authorization for women's business centers. 
Title IV addresses the Small Business Competitiveness Demonstration 
Program and a critical issue for small businesses: procurement 
opportunities. Title V contains provisions supporting the Small 
Business Technology Transfer (STTR) Program, Small Business Development 
Centers, and the pilot preferred surety bond guarantee program. 
Finally, Title VI creates a new

[[Page S8973]]

SBA program, the HUBZone Program that extends contracting opportunites 
to small businesses located in the poorer areas of our country.
  Mr. President, it is a fact that small business owners often are not 
served by traditional lending services. SBA operates several programs 
designed to fill this lending void and extend assistance to this 
critical segment of the American economy. From the Microloan Program 
which makes loans only in amounts of less than $25,000 to the 504 
program where loan guarantees can be as high as $1,250,000, SBA 
programs meet a critical need for our country's entrepreneurs. 
Accordingly, I am pleased with the support the committee has shown by 
authorizing adequate funding levels for most SBA programs. The 7(a), 
504, Small Business Investment Company, Delta and SCORE programs were 
all authorized at or above the administration's requests. All of these 
programs are critical to the continued effectiveness of the Small 
Business Administration and for the future of small business 
development in our country.
  The SBA's Microloan Program has been a tremendous success since its 
inception in 1991. Since its authorization, this program has provided 
technical assistance and made over 5,800 loans totaling over $60 
million to small businesses in our country. The Microloan Program 
authorizes intermediary lenders to provide loans under $25,000 to small 
businesses and to provide the business owners with technical assistance 
on how to run their business more effectively. There are 103 Microloan 
intermediaries located in 46 of our 50 States, including 5 in my home 
State of Massachusetts. Forty-three percent of microloans go to women-
owned businesses, 39 percent to minority-owned businesses, and 11 
percent to veteran-owned businesses.
  The results could not be more stunning. The Microloan Program has 
been so successful that there has only been one default of a loan to an 
intermediary in the years it has been in operation. Because of its 
demonstrated success, the committee chose to elevate the Microloan 
Program from demonstration status to a permanent part of the SBA 
portfolio of programs and to authorize $28 million per year for each of 
the next 3 years for the essential technical assistance grants. After 
listening to the testimonies of witnesses on the importance of 
technical assistance to microloan borrowers, it is clear that the 
support of the direct loan portion of the program requires supporting 
the technical assistance portion. The borrowers will not be able to 
utilize the direct loans properly without first learning how to manage 
their businesses. I am pleased that the Microloan Program is receiving 
support from the committee and hope that we will continue to support 
the important technical assistance component in the future.
  Another section of this bill will assist many small businesses 
nationwide. The Women's Business Center provision was originally 
introduced by Senator Domenici and cosponsored by Chairman Bond and 
myself along with all the Democratic members of the Small Business 
Committee. Section 306 makes the Women's Business Center program 
permanent, doubling the funding for the program to $8 million dollars 
for each of the next 3 years, and extends eligibility for awardees from 
3 to 5 years. Women-owned businesses comprise one-third of all American 
companies, contribute more than $1.5 trillion dollars to the U.S. 
economy and employ more people than Fortune 500 companies. The changes 
made by this bill will better enable organizations, such as the Center 
for Women & Enterprise, Inc., in Boston, to continue offering the 
services that help women-owned businesses thrive.

  This bill also reauthorizes the Small Business Technology Transfer 
[STTR] Program for 6 more years. In July, I had the opportunity to 
cohost with the Small Business Administration a conference on STTR in 
Cambridge, MA, with representatives of my State's high-technology small 
business companies. These businesspeople expressed their belief that 
the STTR Program has been an unqualified success in meeting the goals 
established for it by Congress 5 years ago: to ensure that the 
federally funded research conducted in America's nonprofit institutions 
is given an outlet through small businesses to be turned into 
commercial products. That commercialization increases the American job 
base, helps our economy, and allows American businesses to compete with 
overseas rivals. I was proud to be the sponsor of the original 
legislation reauthorizing the STTR Program for 6 more years and I'm 
very happy that it has been included in this bill.
  Many sections of the Small Business Reauthorization Act establish new 
levels of flexibility for the SBA to administer their programs. For 
example, investment restrictions on Small Business Investment Companies 
[SBIC's] have been relaxed to allow greater investment in the SBICs by 
commercial banks. SBIC's will also now be allowed to make quarterly 
distributions to its investors. This may not sound important to many 
people, but allowing quarterly distributions as opposed to yearly or 
biyearly makes it easier for the SBIC's investors to meet their 
quarterly tax requirements. Therefore, an investment in an SBIC is a 
more attractive investment. Attracting more investment helps the SBIC 
help more small businesses.
  The committee has given SBA more authority in the selling of 
debentures. Instead of requiring a sale every 3 months, SBA now must 
sell only every 6 months but can hold sales earlier if adequate demand 
exists. This change is also aimed at making the SBA's assets more 
attractive to investors and therefore, at attracting more favorable 
market prices. Microloan lenders are also given more flexible rules for 
their loan loss reserves. After a Microloan lender has been in the 
program for at least 5 years, they will be allowed to carry a loan loss 
reserve equal to the greater of 10 percent or twice that lender's 
historical loan loss rate. This provision frees up more resources for 
many lenders to make more loans and provide a greater boost to the 
economy. All of these changes have been undertaken in an effort to 
allow the SBA to run in a more businesslike, market-responsive manner. 
I am pleased to support these changes and look forward to the progress 
that SBA will show in the coming years.
  A new program authorized through this bill is the Welfare-to-Work 
Microloan Pilot Program. I originally introduced this legislation to 
build on the successes of the Microloan Program by providing additional 
training and support for some of today's welfare recipients so that 
they may be tomorrow's business owners. The bill authorizes $4, $5, and 
$6 million over each of the next 3 fiscal years for this purpose. At a 
hearing on the Microloan Program last month, members of the committee 
heard testimony that demonstrated how it is possible for welfare 
recipients to become successful entrepreneurs given the proper 
technical assistance training. At that same hearing, Mr. John Else of 
the Institute of Social and Economic Development in Iowa told the 
committee about the remarkable success rate they have with their 
Microloan clients. These clients, mostly welfare recipients and other 
low-income people, had a 70-percent success rate which is an astounding 
contrast to the high failure rate for startup businesses. So the 
committee believes the goals of the Welfare-to-Work Pilot Program are 
attainable. I believe it is time that we give welfare recipients across 
the country the opportunity to succeed by expanding the mission and 
scope of the Microloan Program.
  Finally, I thank the chairman of the Senate Small Business Committee, 
Senator Bond, for his efforts throughout the reauthorization process 
that have resulted in a very productive and effective bill. His support 
for SBA programs is demonstrated through his willingness to make sure 
that the effectiveness of these programs continues by adequately 
funding them. A provision included in the reauthorization bill which 
was initiated by the chairman and which I cosponsored after the 
chairman agreed to certain improvements, is the historically 
underutilized business zone or HUBZone bill. Its stated purpose of 
assisting companies in economically depressed areas is a worthy goal 
that gained widespread support on the committee. Through HUBZones, more 
contracting opportunities will be available in the poorest areas of our 
country. This is definitely another strike against impoverished regions 
and a further opportunity for American small businesses. I am pleased 
that is was included in the committee bill.

[[Page S8974]]

  Mr. President, our Nation's small businesses are the backbone of our 
economy. By supporting the Small Business Reauthorization Act, my 
colleagues have demonstrated their support for our Nation's small 
businesses and their commitment to our future.
  Mr. COVERDELL. Mr. President, as the Senate considers the Small 
Business Reauthorization Act of 1997, S. 1139, I rise to express my 
thanks to Senator Bond for his leadership on behalf of small business. 
As many of us have stated in the Senate, small businesses today face 
the daunting task each day of meeting their payrolls, providing a 
quality work environment for their employees, and remaining 
competitive. All the while, they strive to comply with a myriad of 
regulations and struggle to satisfy the tax burden government imposes 
upon them.
  The Committee on Small Business held a hearing earlier this year 
regarding women-owned business. The committee members heard testimony 
that, in 1996, women-owned businesses employed 1 out of every 4 
workers, totaling 18.5 million employees. Last year, these businesses 
accounted for an estimated $2.3 trillion in sales. Increasingly, women 
are becoming small business owners and according to the National 
Foundation of Women Business Owners, the growth of these women-owned 
small businesses outpaced overall business growth nearly 2 to 1. In 
Georgia alone, there are 143,045 women-owned businesses, both full and 
part-time. Women are a vital force in our economy, and we need to do 
more to remove the obstacles that are in their way.
  This leads me to think about Carolyn Stradley, a truly remarkable 
Georgian from Marietta. She offered testimony before the Small Business 
Committee where she described her experience as an entrepreneur. From 
humble beginnings, she started and built her own paving business over 
many significant obstacles. Unfortunately, chief among these obstacles 
was, and continues to be, the Federal Government.
  I believe support for women-owned small businesses is important. Such 
entrepreneurship has provided a vital means for many to break the cycle 
of poverty created and sustained by the welfare state. As we strive for 
welfare reform, small businesses and entrepreneurship provide an 
important avenue for many.
  Mr. President, at this point in my statement, I would like to take 
the opportunity also to thank Senator Bond for his cooperation and 
sensitivity to the concerns of women-owned small businesses. This 
legislation before us authorizes the National Women's Business Council 
with the resources it needs to help women entrepreneurs. I was pleased 
to have worked with my good friend and fellow Georgian, Senator Max 
Cleland, in committee to ensure the Council received this critical 
support.
  Mr. President, I ask unanimous consent that a letter from Ms. Carolyn 
Stradley be printed in the Record.
  There being no objection, the letter was ordered to be printed in the 
Record, as follows:

                                             C&S Paving, Inc.,

                                      Marietta, GA, July 29, 1997.
     Hon. Paul Coverdell,
     U.S. Senate, Russell Senate Office Building,
     Washington, DC.
       Dear Senator Coverdell: Thank you so much for your support 
     of the National Women's Business Council. I truly appreciate 
     your efforts.
       As you know, women entrepreneurs rely on the Council to get 
     a ``seat at the table'' in the decision making process. The 
     Council has successfully raised the profile of women business 
     owners and taken our views to the Senate, House and 
     Administration. In addition, the Council has helped us build 
     an infrastructure to support women's entrepreneurship and the 
     growth of women owned enterprises. Until women business 
     owners are fully integrated into the process, the role of the 
     National Women's Business Council is critical to our growth 
     and survival.
       As a result of your advocacy, the Council received an 
     increased budget authorization for fiscal year 1998. In 
     addition, the amendment offered by you and Senator Cleland 
     during the Small Business Committee mark-up of the Small 
     Business Reauthorization bill granted the Council a research 
     budget of $200,000. With these additional funds, the Council 
     can continue to be an effective voice for women entrepreneurs 
     within the federal government and engage in seriously needed 
     research on women business owners.
       It has been a pleasure working with Morris Goff. We have 
     greatly appreciated his hard work and counsel throughout this 
     process. Once again, thank you for your leadership on this 
     issue. I knew we could count on you.
           Sincerely,
                                                 Carolyn Stradley,
                                                        President.

  Mr. COVERDELL. Mr. President, I also thank Chairman Bond for 
including S. 925, the Women's Small Business Programs Act of 1997 that 
I introduced earlier this year, in the Small Business Reauthorization 
Act of 1997. My proposal will expand the pool of resources available to 
women-owned small businesses and would allow women business development 
centers to enter into contracts with other Federal agencies and 
departments to provide specific assistance to small business concerns.
  Far too often our Government serves as a roadblock to small business 
men and women. Taxes are too high, regulations are too complex, the 
costs of doing business are through the roof. It is time we did 
something to help our Nation's working women.
  Mr. CLELAND. Mr. President, I am proud to offer my support for the 
Small Business Administration reauthorization. I am extremely proud to 
be a part of the Small Business Committee and, I appreciate the work of 
my chairman and the ranking member for their hard work and for working 
together to resolve all of the outstanding differences on the details 
of the bill. I also thank so many of the staff for their hard work.
  Mr. President, there are several things I want to highlight in this 
legislation. First, I want to offer my strong support for the Welfare-
to-Work Microloan Pilot Program. Many times, good men and women have 
come to this floor in support of programs and opportunities that 
aspired to do great things for those who needed it most. Some of those 
initiatives have gone on to become great public endeavors. I am proud 
to support such an endeavor, one that I believe will inspire and offer 
hope to Americans that truly want to break the cycle of poverty and 
build a business of their own. This program puts our money where our 
mouths are. It provides upfront technical assistance for business 
planning, loan application assistance, and development of sound 
business skills for people who we can provide a ladder of opportunity 
rather than just the same old welfare system. If we want to stand 
strong behind the notion that public assistance should be a hand up, 
not a hand out, we must pro-actively seek out ways to provide 
meaningful job opportunities for welfare recipients. This program is a 
step in the right direction.
  This program targets traditionally under-served Americans and gives 
them tools they can use to, not only take themselves off of the welfare 
rolls, but provide job opportunities in areas of the country that are 
desperate for job growth. This legislation has been tried and shown 
great promise. With 2.8 million Americans moving off of welfare, the 
potential for this program is obvious. It's the kind of investment that 
can return much, much more than what we put in. Let me add just a few 
more points. The average microloan to an individual is $10,800, not a 
lot of money by Washington standards, but to the man or woman who just 
wants an opportunity to change the direction of their life and that of 
their loved ones, it may make all the difference in the world.
  I also offer my support for the SBA's Small Business Technology 
Transfer Pilot Program. This important program builds on past successes 
of further advancing increased commercialization of federally funded 
research projects.
  Finally, Mr. President, I want to say how proud I am of the National 
Women's Business Council and the work that they have done. I am honored 
to have worked with Senator Coverdell and thank him for helping to 
obtain funding for this important organization and the work that they 
do on behalf of women. I further add that Anita Drummond on the 
minority staff and Suey Howe on the majority side were particularly 
helpful in this effort and should be commended for a job well done.
  All in all, there are many provisions in this legislation that I am 
proud to have had a part in crafting. I look forward to even more 
success on a bipartisan basis from within the committee, from the SBA 
and from the small business community in tackling the problems facing 
small businesses. I look

[[Page S8975]]

forward to the work ahead. I thank my colleagues and I thank the chair.
  Mr. DOMENICI. Mr. President, I submit for the Record a cost estimate 
prepared on August 8, 1997 by the Congressional Budget Office for S. 
1139, the Small Business Reauthorization Act of 1997, which was 
reported on August 19, 1997. The report of the Committee on Small 
Business states that the committee does not agree with the CBO estimate 
and therefore the committee did not include the CBO estimate in its 
report. The Congress and the Budget Committees must rely on independent 
cost estimates from the Congressional Budget Office for reported 
legislation. From time to time, I too have disagreed with CBO cost 
estimates. I ask unanimous consent to print in the Record the official 
CBO estimate for S. 1139.
  There being no objection, the estimate was ordered to be printed in 
the Record, as follows:

               Congressional Budget Office Cost Estimate


               Small Business Reauthorization Act of 1997

       Summary: The bill would authorize appropriations for fiscal 
     years 1998 through 2000 for the Small Business Administration 
     (SBA) and would make a number of changes to SBA loan programs 
     and programs establishing preferences for government 
     contracting.
       Assuming appropriation of the necessary amounts, CBO 
     estimates that enacting this legislation would result in new 
     discretionary spending of at least $4.4 billion over the 
     1998-2002 period. Of this total, $570 million is from amounts 
     specifically authorized in the bill for SBA programs--
     primarily for administrative expenses. The remaining $3.8 
     billion would be primarily for the subsidy costs of SBA loan 
     programs.
       The costs include $13 million over the 1998-2002 period for 
     other federal agencies to carry out existing federal 
     procurement programs reauthorized by the bill. Implementing 
     the HUBZone program that the bill would create would also 
     increase costs to other federal agencies. While we cannot 
     precisely estimate the impact of the new program at this 
     time, its costs could be at least several million dollars 
     annually.
       CBO estimates that enacting the bill also would result in 
     an increase in direct spending of $1 million in fiscal year 
     1998 and $5 million over the 1998-2002 period. Because the 
     bill would affect direct spending, pay-as-you-go procedures 
     would apply.
       The legislation contains no intergovernmental or private-
     sector mandates as defined in the Unfunded Mandates Reform 
     Act (UMRA) of 1995 and would impose no costs on state, local, 
     or tribal governments.
       Description of the bill's major provisions: Title I would 
     establish maximum levels for small business loans to be made 
     by the SBA in 1998, 1999, and 2000. It also would authorize 
     appropriations for the Service Corps of Retired Executives 
     (SCORE), technical assistance grants to microloan 
     recipients, and certain activities of the Small Business 
     Development Centers (SBDCs). Title I also would authorize 
     such sums as may be necessary for the disaster loan 
     program and for administrative expenses necessary to carry 
     out the Small Business Act and the Small Business 
     Investment Act.
       Title II would establish a Welfare-to-Work Microloan Pilot 
     Program and would authorize the appropriation of $12 million 
     of the 1998-2000 period for the SBA to carry out the program. 
     The title also would convert the direct microloan program 
     from a demonstration program to a permanent program and would 
     extend the authorization for the microloan guarantee program 
     through fiscal year 2000. (The microloan program provides 
     technical assistance and loans ranging from $100 to $25,000 
     to very small businesses.) In addition, Title II would modify 
     several SBA guaranteed loan programs and would allow the SBA 
     to charge fees to certain borrowers.
       Title III would authorize the appropriation of $1.2 million 
     over the 1998-2000 period for the operations of the 
     Interagency Committee on Women's Business Enterprise and the 
     National Women's Business Council. The title would require 
     the National Women's Business Council to conduct two studies 
     on federal procurement practices and would authorize the 
     appropriation of $200,000 to carry out the studies. In 
     addition, the title would authorize appropriations of $8 
     million per year for grants to Women's Business Centers.
       Title IV would extend the authorization for the Small 
     Business Competitive Demonstration Program and the Small 
     Business Participation in Dredging Program through fiscal 
     year 2000. The title also would modify the Small Business 
     Procurement Opportunities Program to require federal agencies 
     to review their attainment of small business participation 
     goals and the effects of contract bundling on small 
     businesses.
       Title V would extend the Small Business Technology Transfer 
     (STTR) Program through fiscal year 2003. Title V also would 
     authorize the appropriation of $2 million in each of fiscal 
     years 1998 through 2000 for the SBA to assist small 
     businesses in certain states in securing Small Business 
     Innovation Research and STTR awards. In addition, this title 
     would make numerous changes to the SBDC program and would 
     authorize the appropriation of $460 million over the 1998-
     2002 period for the SBDC program.
       Title VI would create a new program, to be administered by 
     the SBA, to provide federal contracting set-aside and 
     preferences to qualified small businesses located in 
     designated, economically distressed, urban and rural 
     communities, or HUBZones. The bill would establish goals for 
     awarding a percentage of all prime federal government 
     contracts (beginning at 1 percent in 1999 and increasing to 3 
     percent in 2003 and subsequent years) to eligible HUBZone 
     businesses. Title VI would authorize appropriations 
     totaling $15 million for fiscal years 1998 through 2000 
     for SBA to carry out this program.
       Estimated cost to the Federal Government: The estimated 
     budgetary impact of implementing most of the bill's 
     provisions is shown in Table 1. Estimated additional outlays 
     total $4.4 billion over the 1998-2002 period. Nearly all of 
     that amount is for SBA spending that is subject to 
     appropriation. In addition, implementing the bill would 
     increase other federal agencies' contracting costs to comply 
     with the HUBZone provisions (Title VI), but CBO cannot 
     estimate those additional costs with precision at this time.
       Basis of estimate: For the purposes of this estimate, CBO 
     assumes that the bill will be enacted by the end of fiscal 
     year 1997 and that both the authorized and additional 
     necessary amounts will be appropriated by the start of each 
     fiscal year. Outlay estimates are based on historical 
     spending rates for existing or similar programs.
     Spending subject to appropriation
       Most of the bill's budgetary effects would come from 
     reauthorizing existing SBA programs (primarily for the 
     subsidy costs of direct and guaranteed loans). The estimated 
     amounts would be subject to appropriation action.
       Loan programs
       The bill would permit the SBA to make direct loans totaling 
     $60 million in each of fiscal years 1998 through 2000. It 
     would permit the SBA to (1) guarantee business loans totaling 
     about $18 billion in 1998, $20 billion in 1999, and $23 
     billion in 2000, (2) make direct loans totaling $60 million 
     in each of fiscal years 1998 through 2000, and (3) make an 
     indefinite amount of disaster loans over the 1998-2000 
     period. Table 2 shows the loan levels authorized by the bill 
     for SBA's business and disaster loans as well as the 
     estimated subsidy cost and administrative expenses for those 
     loans.

             TABLE 1.--ESTIMATED BUDGETARY EFFECTS OF THE SMALL BUSINESS REAUTHORIZATION ACT OF 1997            
----------------------------------------------------------------------------------------------------------------
                                                      By fiscal years in millions of dollars--                  
                                   -----------------------------------------------------------------------------
                                        1997         1998         1999         2000         2001         2002   
----------------------------------------------------------------------------------------------------------------
                                      SPENDING SUBJECT TO APPROPRIATION\1\                                      
Spending Under Current Law:                                                                                     
    Budget Authority\2\...........          873            0            0            0            0            0
    Estimated Outlays.............          820          299           65           21            9            0
Proposed Changes:                                                                                               
    Specified Authorization Level.            0          151          157          163          103          103
    Estimated Authorization Level.            0        1,226        1,274        1,327           13           13
                                   -----------------------------------------------------------------------------
      Total Authorization Level...            0        1,377        1,431        1,490          116          116
Estimated Outlays.................            0          871        1,276        1,444          583          189
Spending Under The Bill:                                                                                        
    Authorization Level\2\........          873        1,377        1,431        1,490          116          116
    Estimated Outlays.............          820        1,171        1,341        1,465          592          189
                                                                                                                
                                           CHANGES IN DIRECT SPENDING                                           
                                                                                                                
    Estimated Budget Authority....            0            1            1            1            1            1
Estimated Outlays.................            0            1            1            1            1           1 
----------------------------------------------------------------------------------------------------------------
\1\ All but approximately $15 million of the estimated amounts are for projected spending by the SBA. In        
  addition to the amounts shown in the table, CBO expects that Title VI (HUBZone program) would impose          
  significant costs on agencies other than the SBA, but we cannot estimate those costs at this time.            
\2\ The 1997 level is the amount appropriated for that year.                                                    


[[Page S8976]]

       The costs of this legislation fall within budget functions 
     370 (housing and commerce credit) and 450 (community and 
     regional development).

                       TABLE 2.--SBA LOAN LEVELS, SUBSIDY COSTS, AND ADMINISTRATIVE COSTS                       
----------------------------------------------------------------------------------------------------------------
                                                            By fiscal years, in millions of dollars--           
                                                ----------------------------------------------------------------
                                                     1998         1999         2000         2001         2002   
----------------------------------------------------------------------------------------------------------------
                                             AUTHORIZED LOAN LEVELS                                             
                                                                                                                
Guaranteed and Direct Business Loans...........       18,200       19,950       22,650            0            0
Disaster Loans.................................        1,543        1,543        1,543            0            0
                                                                                                                
                                               LOAN SUBSIDY COSTS                                               
                                                                                                                
Guaranteed and Direct Business Loans:                                                                           
    Estimated Authorization Level..............          350          380          421            0            0
    Estimated Outlays..........................          225          348          390          133            8
Disaster Loans:                                                                                                 
    Estiamted Authorization Level..............          459          459          459            0            0
    Estimated Outlays..........................          230          413          459          230           46
                                                                                                                
                                            LOAN ADMINISTRATION COSTS                                           
                                                                                                                
Guaranteed and Direct Business Loans:                                                                           
    Estimated Authorization Level..............           94           97          100            0            0
    Estimated Outlays..........................           94           97          100            0            0
Disaster Loans:                                                                                                 
    Estimated Authorization Level..............          164          169          174            0            0
    Estimated Outlays..........................          164          169          174            0            0
----------------------------------------------------------------------------------------------------------------

       The Federal Credit Reform Act of 1990 requires 
     appropriation of the subsidy costs and administrative costs 
     for operating credit programs. (The subsidy cost is the 
     estimated long-term cost to the government of a direct loan 
     or loan guarantee, calculated on a net present value basis, 
     excluding administrative costs.) The bill does not provide an 
     explicit authorization for either the subsidy or 
     administrative costs for the guaranteed, direct, or disaster 
     loans.
       Based on information from the SBA and on historical data 
     for these loan programs, CBO estimates that the subsidy costs 
     of guarantees for the authorized levels of business loans 
     would be $344 million in 1998, $374 million in 1999, and $415 
     million in 2000. We estimate that the subsidy costs of the 
     direct business loans would be $6 million for each of 
     fiscal years 1998 through 2000. Based on recent 
     administrative costs for the SBA's loan programs, CBO 
     estimates that the administrative costs for the business 
     loan programs would be about $94 million in fiscal year 
     1998, $97 million in fiscal year 1999, and $100 million in 
     fiscal year 2000.
       The estimated subsidy rates for business loans and 
     guarantees range from 0.5 percent to 8.1 percent, but most 
     are at 2 percent or less and the average for this estimate is 
     1.9 percent. The estimated subsidy rate for disaster loans is 
     about 30 percent.
       Assuming that demand for SBA's disaster loans over the next 
     three years will be at the average historical rate for the 
     past six years, CBO projects that the SBA would make disaster 
     loans totaling about $1.5 billion in each fiscal year over 
     the 1998-2000 period. CBO estimates that the subsidy costs of 
     these loans would be $459 million in each fiscal year and 
     that the administrative costs for the disaster loan program 
     would be about $164 million in 1998, $169 million in 1999, 
     and $174 million in 2000.


                              surety bonds

       The bill would authorize the SBA to guarantee up to $2 
     billion in surety bonds for small businesses in each of the 
     fiscal years 1998, 1999, and 2000. Such guarantees are not 
     considered loan guarantees under the definition in the 
     Federal Credit Reform Act of 1990, and annual appropriations 
     are required only to cover the net cash losses to the program 
     within a given year. Based on information from the SBA, CBO 
     estimates that the authorized level of activity would result 
     in outlays of $4 million each year over the 1998-2000 period.


                    government contracting programs

       The legislation would modify a number of government 
     contracting programs administered by the SBA that provide 
     set-asides or other incentives for small businesses competing 
     for government procurement contracts. The costs to the SBA to 
     administer these programs are generally small or 
     insignificant but the programs result in additional costs to 
     the Office of Federal Procurement Policy (OFPP) and various 
     federal agencies.
       Small Business Competitive Demonstration Program. The bill 
     would reauthorize the Small Business Competitive 
     Demonstration Program through fiscal year 2000. This program 
     requires 10 federal agencies to establish contracting goals 
     for small businesses in certain industries. CBO estimates 
     that extending this program would cost each of the 10 
     participating agencies and the SBA less than $100,000 a year 
     to report and compile the required data, assuming 
     appropriation of the necessary amounts. Hence, we estimate a 
     total annual cost of about $1 million for each year that the 
     program is extended.
       Small Business Participation in Dredging Program. Based on 
     information from the Army Corps of Engineers, CBO estimates 
     that extending the Small Business Participation in Dredging 
     Program would cost less than $500,000 annually over the 1998-
     2000 period.
       STTR Progam. The bill would extend this program's 
     expiration date from 1998 through 2000. The STTR program 
     requires federal agencies with annual appropriations for 
     extramural research of more than $1 billion to set aside a 
     specified percentage of their extramural research budget for 
     cooperative research between small businesses and a federal 
     laboratory or nonprofit research center. The costs of the 
     STTR program to the participating agencies consist primarily 
     of personnel, overhead, printing, and mailing expenses. Based 
     on information from the affected agencies, CBO estimates that 
     the costs of administering the awards would be about $1 
     million a year over the 1998-2000 period, assuming 
     appropriation of the necessary amounts.
       Small Business Procurement Opportunities Program. The bill 
     would require federal agencies to follow certain procedures 
     when bundling procurement contracts. Based on information 
     from the OFPP, the SBA, and several other federal agencies, 
     CBO estimates that the government would incur costs of about 
     $2.5 million in fiscal year 1998 and $1.5 million a year in 
     1999 and 2000 to follow the procedures established by the 
     bill. The costs to the federal government would be slightly 
     higher in fiscal year 1998 because each federal agency would 
     incur expenses to modify its reporting systems in order to 
     track information on contract building.
       HUBzone Program. The contracting goals and requirements 
     that would be established by Title VI would apply to 
     specified federal agencies, which make over 90 percent of all 
     federal contract obligations (as of 1996). Assuming the 
     federal agencies would attempt to meet the government-wide 
     contracting goals establishing in the bill, and assuming 
     appropriation of the amounts necessary to meet the increase 
     in costs, implementing the HUBZone program would 
     significantly increase discretionary spending. Such costs 
     could total tens of millions of dollars each year, but CBO 
     cannot estimate such costs precisely. The additional costs 
     would stem from both additional administrative 
     responsibilities for the SBA and other federal agencies, and 
     increased use of sole-source contracting.
       Based on information from the SBA, we estimate that 
     implementing the HUBZone program would cost the SBA $6 
     million in fiscal year 1998 and $12 million in each 
     subsequent year, assuming appropriation of the necessary 
     amounts. Thus, implementing the HUBZone program would result 
     in new discretionary spending by the SBA of $54 million over 
     the 1998-2002 period. Of this amount, $15 million is 
     specifically authorized in the bill for SBA to implement the 
     program. In addition to the authorized amounts, CBO estimates 
     that SBA would require another $39 million over the 1998-2002 
     period to carry out the HUBZone program.
       The other federal agencies affected by Title VI would have 
     additional administrative costs for reviewing contracts, 
     reprogramming computer systems, and reporting to the SBA. 
     However, CBO cannot estimate how much those new 
     responsibilities may increase spending because we do not have 
     sufficient data to project how many contracts would be 
     awarded under the HUBZone program or what administrative 
     resources would be required to carry out the program.
       The HUBZone program would raise the government-wide goal 
     for awarding contracts to small businesses from 20 percent to 
     23 percent of all prime federal contracts, which would likely 
     increase the incidence of sole-source contracting. Federal 
     contract obligations total almost $200 billion a year, of 
     which about 19 percent is provided through sole-source 
     contracts. Although CBO cannot project a specific increase in 
     sole-source contracting, any increase resulting from the 
     HUBZone program would result in new federal costs because the 
     lack of competition often results in a higher price for the 
     product or service. While we cannot estimate precise costs 
     for the likely increase in sole-source contracting under the 
     HUBZone program, such costs could total at least several 
     million dollars annually.
       Other programs
       The bill would provide specific authorizations of 
     appropriations for SBDCs, SCORE,

[[Page S8977]]

     the Welfare-to-Work Microloan Program, and various women's 
     business programs. CBO estimates that these programs would 
     result in spending by the SBA of $555 million over the next 
     five years.
       In addition, the bill would authorize such sums as may be 
     necessary to cover the SBA's costs of carrying out the Small 
     Business Act and the Small Business Investment Company Act. 
     CBO estimates that the general administrative costs to carry 
     out these acts would be $149 million in fiscal year 1998, 
     $154 million in fiscal year 1999, and $158 million in fiscal 
     year 2000, assuming appropriation of the necessary amounts. 
     (The estimate of general administrative costs excludes the 
     program-specific administrative expenses for business and 
     disaster loans.)
     Direct spending
       The bill would authorize the SBA to spend without further 
     authorization the Small Business Investment Company (SBIC) 
     examination fees currently collected by the agency but not 
     available for spending unless authorized in advance in an 
     appropriation act. Based on information from the SBA, CBO 
     estimates that the agency would collect and spend about $1 
     million annually in examination fees.
       Pay-as-you-go considerations: Section 252 of the Balanced 
     Budget and Emergency Deficit Control Act of 1985 sets up pay-
     as-you-go procedures for legislation affecting direct 
     spending or receipts through 2007. CBO estimates that 
     enacting the bill would increase direct spending by $1 
     million a year because SBA would be able to spend SBIC 
     examination fees without appropriation action.
       Estimated impact on State, local, and tribal governments: 
     The bill contains no intergovernmental mandates as defined in 
     UMRA, and would not impose any costs on State, local, or 
     tribal governments. The bill would, however, authorize 
     additional grant funds for State and local governments. It 
     would authorize $2 million annually (for fiscal years 1998 
     through 2000) to create a pilot program that would provide 
     grants to eligible states to assist small businesses located 
     in the state. The bill would also authorize an increase in 
     funding of $5 million in fiscal year 1999 and $10 million 
     thereafter for the Small Business Development Center Program. 
     The program provides grants to state and local governments, 
     public and private institutions of higher education, and 
     state-chartered development corporations to establish and 
     operate small business development centers.
       Estimated impact on the private sector: This bill would 
     impose no new private-sector mandates as defined in UMRA.
       Estimate prepared by: Federal Costs: Rachel Forward and 
     Lisa Daley. Impact on State, Local, and Tribal Governments: 
     Marc Nicole.
       Estimate approved by: Robert A. Sunshine, Deputy Assistant 
     Director for Budget Analysis.
  Mr. BOND. Mr. President, I ask unanimous consent that the amendment 
be agreed to.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  The amendment (No. 1124) was agreed to.
  Ms. SNOWE. Mr. President, I rise today to support a critically 
important piece of legislation affecting small businesses across our 
Nation--S. 1139, the Small Business Reauthorization Act of 1997. I 
would like to begin by thanking Chairman Bond and ranking member Kerry 
for their leadership and perseverance on this bill. We would not be 
here today considering S. 1139 if it were not for their dedication to 
the small business community.
  As a Senator from Maine, a State whose future economic well-being is 
dependent on small business enterprise, I am extremely supportive of 
the role the Small Business Administration [SBA] plays in promoting 
small business development and growth. The Small Business Committee, of 
which I am a member, held five hearings this past year on SBA's 
finance, noncredit, and Microloan programs. As a direct result of 
testimony given during those hearings by small businesses, the SBA and 
various industry organizations, the committee drafted a comprehensive 
bill that reauthorizes and improves upon even the most successful of 
SBA's programs.
  I am particularly pleased that the committee accepted an amendment 
that I offered regarding the Small Business Development Center [SBDC] 
Program. The SBDC Program is a public-private partnership that 
leverages Federal dollars with State, local, university, and private 
resources to provide one-stop management and technical assistance to 
small businesses.
  My amendment increases the SBDC minimum Federal contribution so that 
no State will receive less than $500,000. This will ensure that small 
State SBDC's will continue to be able to provide quality business 
management assistance, which is essential to the future successes of 
America's small businesses. If entrepreneurs are not sufficiently 
prepared with the financial, managerial, and technical knowledge needed 
to own and operate a business, then our Nation's future businesses have 
failed before they have been given the opportunity to succeed.

  One of the many reasons I support the SBDC program is because it 
serves as a successful example of what can be achieved when the private 
sector, the educational community and Federal, State and local 
governments work together. In fact, the SBDC program generates more in 
tax revenues that it costs to run the program itself. For example, in 
my home State of Maine, $6.15 in new Federal, State and local tax 
revenues is generated for every $1.00 invested in our state's SBDC. 
Nationally, the return is $4.53.
  While my amendment provides only a modest funding increase at the 
Federal level, the additional resources provided to a small State like 
Maine will have a disproportionately large and positive impact on 
Maine's economy. And I thank Chairman Bond for including my amendment 
in the Small Business Reauthorization Act.
  I would also like to thank Chairman Bond for his leadership on S. 
208, the HUBZone Act of 1997, because the revitalization and community 
development of economically distressed regions with significant 
unemployment is a critical challenge confronting this Congress. It is 
essential that we discover ways to stimulate business and residential 
activity within these economically and socially distressed communities, 
which is why I believe that it is so important that the HUBZone Act was 
incorporated into the Small Business Reauthorization Act.
  The HUBZone Act will provide Federal contracting opportunities to 
small businesses located in historically impoverished urban and rural 
areas known as HUBZones. This bill will create a new class of small 
businesses that employ at least 35 percent of its workforce from a 
HUBZone eligible for Federal Government contract preferences. The 
purpose of the bill is to create incentives for small businesses to 
locate and operate in our country's most economically disadvantaged 
inner-cities and rural counties. At the same time, these businesses 
will foster job creation and community development in these 
economically underutilized areas.
  In Maine, Washington County with an extremely high unemployment rate 
of 12.5 percent--7.6 percent above the national average--will qualify 
as a HUBZone. Qualified small businesses located in this county will 
not only receive Federal contracting set-asides but also will play a 
vital role in revitalizing this distressed area by encouraging job 
creation.
  Additionally, because of an amendment Senator Enzi and I offered, 
both Aroostook and Somerset Counties with a 10.4 percent and 9 percent 
unemployment, respectively, will qualify as rural HUBZones. The Enzi-
Snowe amendment establishes that economically distressed regions with 
extremely high unemployment rates will quality as HUBZones and receive 
much-needed relief. We must take action to stimulate business activity 
within these areas that face high unemployment rates and I believe that 
the HUBZone Act of 1997 does just this.
  The Small Business Reauthorization Act also includes another 
important piece of legislation, the Welfare-to-Work Microloan Pilot 
Program Act of 1997, of which I am an original cosponsor. This 
innovative pilot program will provide grants to community-based 
organizations, known as Microloan intermediaries, to help welfare 
recipients start their own small businesses. These intermediaries will 
provide technical assistance to potential small entrepreneurs who are 
on public assistance.
  This program is unique because it will provide up-front business 
assistance before a participant receives a loan. The future 
entrepreneur will learn basic business skills--how to develop a 
business plan, start a business and apply for small loans.
  In addition to this technical assistance, program participants will 
receive assistance with the high cost of child care and transportation, 
both of which are directly related to program participation. If a 
mother is unable to afford to put her child in day care or if she does 
not have the money to get to the

[[Page S8978]]

training sessions, she simply will not go.
  The combination of business training and child care and 
transportation assistance will assure greater success for the 
participants receiving public assistance. This approach has been 
successfully piloted in several state programs. Iowa, for example, has 
a success rate of 70 percent in contrast to a national small business 
failure rate average of 80 percent. I believe that these programs are 
successful because they target the true cause of the high failure rate 
of small businesses--lack of business education.
  Small businesses are playing an increasingly important role in 
America's future prosperity, and they should play a vital role in any 
effort to revitalize our urban and rural communities and to solve the 
long-term problem of getting individuals off, and keeping them off, 
public assistance. This is exactly why I am a cosponsor of the HUBZone 
Act and an original cosponsor of the Welfare-to-Work Microloan Pilot 
Program. And, that is why I strongly support the Small Business 
Reauthorization Act of 1997 and encourage my distinguished colleagues 
to join me in supporting this critically important bill.
  Mr. WELLSTONE. Mr. President, I am extremely pleased that we are 
passing this bill to reauthorize Small Business Administration 
programs. I commend Senators Bond and Kerry, the chairman and ranking 
member of the Small Business Committee, respectively, for their work. 
It is an excellent bill, providing adequate loan-guaranty authorization 
levels for SBA's two principle credit programs--the 7(a) and the 504 
programs. The bill also expands and makes permanent the microloan 
demonstration program, which is extremely important. All three programs 
are popular and successful in Minnesota. Our committee held a number of 
hearings this year to prepare for this reauthorization bill, and as 
usual we have worked in a productive, bipartisan way.
  Our committee passed a very good bill, highlights of which I will 
mention momentarily. I would first like to note, however, two items 
which I am grateful could be included in the managers' amendment. The 
first is a provision clarifying SBA's policy regarding collateral in 
the 504 Program.
  The 504 Program is an excellent program. It operates through 
collaboration between certified development companies (CDCs), private 
lenders and small business borrowers. 504 loans are for larger projects 
than SBA's 7(a) guaranteed loans. They generally are for property, 
plant and equipment purchases. It is the only SBA program with job-
creation and economic development as its explicit primary objective. I 
am proud to point out that Minnesota CDCs made 359 loans worth $122 
million last year, tops in the nation for the third or fourth year in a 
row.
  I appreciate steps that were taken by SBA officials in a recent 
policy guidance on this matter of collateral. That policy guidance 
assures certified development companies that collateral is only one 
factor evaluated in the credit determination of a small business in the 
program. Furthermore, the guidance establishes that collateral in 
addition to a subordinate lien position on the property being financed 
will be required only on a case-by-case basis as determined by the 
Administrator.
  The provision now included in this bill relating to collateral simply 
codifies that SBA policy guidance in statute. I thank the bill's 
managers for including the provision at my request in their amendment. 
As I mentioned to my colleagues on the committee during our markup of 
the bill, it is occasionally necessary for Small Business Committee to 
save SBA from itself when it comes to policy proposals concerning its 
loan programs. Not too many years ago, SBA wanted to eliminate all 
subsidy and appropriation for the 7(a) program. We on the committee and 
in Congress were right in preventing them from doing so.
  Subsidy rate questions in the 504 Program remain somewhat unresolved. 
The simple fact is that demand for the 504 program has been down 
significantly this year. It is down even after we discount for the 
burst of activity last September, just before new fees went into 
effect, putting many deals that normally would have been done this year 
into last year's volume. I am pleased to say that the program's subsidy 
rate, which a witness from Minnesota told our committee earlier this 
year is ``out of whack,'' is now finally being seriously examined by 
the Administration despite the existence for some time of evidence that 
it has been based on methodology or calculations that keep the subsidy 
rate too high. That matters because it appears that the new fees which 
we have had to impose on borrowers and lenders, required by the high 
subsidy rate, suppressed demand for the program, exactly as both the 
Chairman and I said we feared might happen.

  That is the main reason for the amendment, which would keep 
collateral for 504 deals valued at market value. That is rather than at 
liquidation value, as had at one point been suggested by some within 
the Administration. The amendment does not change current SBA policy. 
Rather, it prevents a suggested change, which in my view would 
certainly have led to a further weakening of the 504 loan guaranty 
program.
  Here is the issue. Under current SBA policy, in a project valued at 
$1 million, 90 percent of the value of a 504 project can be financed by 
a CDC and a bank together in the form of loans. The remaining 10 
percent is required to be provided as equity by the assisted small 
business. Loan collateral is limited ``generally to the assets being 
financed.'' This allows the program to offer attractive, 90-percent 
loan-to-value financing. It seems like a good deal, and it is, for 
borrowers and lenders.
  But it's also a good deal for taxpayers because this program creates 
jobs with no appropriation. That's why I want to keep that policy 
working the way it is. If we had allowed the Administration to change 
that policy, by switching to a ``liquidation value'' approach for 
collateral, as had been suggested by some within the Administration, 
then assisted small business people could have been required to provide 
up to $300,000 of their own equity as collateral, on top of the 
$100,000 equity already required. When demand for this program already 
is being suppressed by high fees brought on by high subsidy rates--
whether justified or not--this new blow to the program could have 
seriously harmed it. The National Association of Development Companies, 
which represents CDC's around the country, told some of us it felt the 
program could have been ``destroyed.'' So I am pleased we could address 
this concern in the bill.
  The second provision I would like to mention immediately is a matter 
upon which I am pleased to have collaborated with Senator Abraham. The 
managers also have included this provision in their amendment. It will 
allow microloan intermediaries to use up to 25 percent of the grants 
provided to them by SBA for the provision of technical assistance to 
provide such technical assistance to prospective borrowers--that is, 
not only small enterprises which are already borrowers, but to 
prospective borrowers, as well. I appreciate the inclusion of this 
provision, which allows needed flexibility on the part of microloan 
intermediaries. Minnesota has four microlending intermediaries, and 
staff from those organizations have told me how important it is that 
they be allowed sometimes to counsel and assist potential entrepreneurs 
prior to the time they are ready to become an actual borrower. In fact 
the very purpose of the technical assistance during this period is to 
allow the businessperson to reach the point in his or her business 
where credit is needed and he or she might become a borrower in the 
program.
  The bill reauthorizes most SBA programs for an additional 3 years. 
The loan guaranty authorization levels are adequate in my judgment. In 
the case of both the 7(a) and 504 program, they exceed industry 
requests. The loan authorization level for the microloan program meets 
the Administration's request, although I had hoped to achieve a higher 
level for technical assistance grant funding. As I mentioned before, 
the microloan program nonetheless is expanded and made permanent in 
this bill, steps which are justified by the program's very beneficial 
performance. As an original cosponsor of the legislation which first 
created the program, I am proud that Minnesotans who utilize it are 
among the nation's leaders. The very small firms which receive very

[[Page S8979]]

small loans through the microloan program often have a big impact in 
their communities.
  The bill will allow SBA programs to continue to be among the most 
popular and effective business programs operated by the federal 
government. I know they are popular and well used in Minnesota, where I 
am also proud to point out that we have one of the finest SBA district 
offices in the country, if not the finest. The bill also addresses a 
concern which many small businesses across the country have brought to 
our attention. That is the issue of Federal Government bundling of 
procurement contracts. The bill takes steps to help ensure that small 
firms can compete for Federal contracts, and that the Government's use 
of bundling is strictly warranted when it occurs.
  Mr. President, I hope the House of Representatives also will act soon 
on their version of the bill, and I look forward to voting for passage 
of a conference report so the bill can be sent to the President. Thank 
you.
  Mr. BOND. Mr. President, I ask unanimous consent that the bill be 
considered read a third time and passed, as amended; that the motion to 
reconsider be laid upon the table; and that any statements relating to 
the bill appear at the appropriate place in the Record.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  The bill (S. 1139), as amended, was read the third time and passed, 
as follows:

                                S. 1139

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

     SECTION 1. SHORT TITLE; TABLE OF CONTENTS.

       (a) Short Title.--This Act may be cited as the ``Small 
     Business Reauthorization Act of 1997''.
       (b) Table of Contents.--The table of contents for this Act 
     is as follows:

Sec. 1. Short title; table of contents.
Sec. 2. Effective date.

                        TITLE I--AUTHORIZATIONS

Sec. 101. Authorizations.

                     TITLE II--FINANCIAL ASSISTANCE

                     Subtitle A--Microloan Program

Sec. 201. Microloan program.
Sec. 202. Welfare-to-work microloan pilot program.

         Subtitle B--Small Business Investment Company Program

Sec. 211. 5-year commitments for SBICs at option of Administrator.
Sec. 212. Fees.
Sec. 213. Small business investment company program reform.
Sec. 214. Examination fees.

           Subtitle C--Certified Development Company Program

Sec. 221. Loans for plant acquisition, construction, conversion, and 
              expansion.
Sec. 222. Development company debentures.
Sec. 223. Premier certified lenders program.

                TITLE III--WOMEN'S BUSINESS ENTERPRISES

Sec. 301. Interagency committee participation.
Sec. 302. Reports.
Sec. 303. Council duties.
Sec. 304. Council membership.
Sec. 305. Authorization of appropriations.
Sec. 306. Women's business centers.
Sec. 307. Office of women's business ownership.
Sec. 308. National Women's Business Council procurement project.

    TITLE IV--COMPETITIVENESS PROGRAM AND PROCUREMENT OPPORTUNITIES

           Subtitle A--Small Business Competitiveness Program

Sec. 401. Program term.
Sec. 402. Monitoring agency performance.
Sec. 403. Reports to Congress.
Sec. 404. Small business participation in dredging.

      Subtitle B--Small Business Procurement Opportunities Program

Sec. 411. Contract bundling.
Sec. 412. Definition of contract bundling.
Sec. 413. Assessing proposed contract bundling.
Sec. 414. Reporting of bundled contract opportunities.
Sec. 415. Evaluating subcontract participation in awarding contracts.
Sec. 416. Improved notice of subcontracting opportunities.
Sec. 417. Deadlines for issuance of regulations.

                   TITLE V--MISCELLANEOUS PROVISIONS

Sec. 501. Small business technology transfer program.
Sec. 502. Small business development centers.
Sec. 503. Pilot preferred surety bond guarantee program extension.
Sec. 504. Extension of cosponsorship authority.
Sec. 505. Asset sales.
Sec. 506. Small business export promotion.
Sec. 507. Defense Loan and Technical Assistance program.

                       TITLE VI--HUBZONE PROGRAM

Sec. 601. Short title.
Sec. 602. Historically underutilized business zones.
Sec. 603. Technical and conforming amendments to the Small Business 
              Act.
Sec. 604. Other technical and conforming amendments.
Sec. 605. Regulations.
Sec. 606. Report.
Sec. 607. Authorization of appropriations.

     SEC. 2. EFFECTIVE DATE.

       This Act and the amendments made by this Act shall take 
     effect on October 1, 1997.
                        TITLE I--AUTHORIZATIONS

     SEC. 101. AUTHORIZATIONS.

       Section 20 of the Small Business Act (15 U.S.C. 631 note) 
     is amended by striking subsections (c) through (q) and 
     inserting the following:
       ``(c) Fiscal Year 1998.--
       ``(1) Program levels.--The following program levels are 
     authorized for fiscal year 1998:
       ``(A) For the programs authorized by this Act, the 
     Administration is authorized to make--
       ``(i) $28,000,000 in technical assistance grants, as 
     provided in section 7(m); and
       ``(ii) $60,000,000 in loans, as provided in section 7(m).
       ``(B) For the programs authorized by this Act, the 
     Administration is authorized to make $17,040,000,000 in 
     deferred participation loans and other financings. Of such 
     sum, the Administration is authorized to make--
       ``(i) $13,000,000,000 in general business loans as provided 
     in section 7(a);
       ``(ii) $3,000,000,000 in financings as provided in section 
     7(a)(13) of this Act and section 504 of the Small Business 
     Investment Act of 1958;
       ``(iii) $1,000,000,000 in loans as provided in section 
     7(a)(21); and
       ``(iv) $40,000,000 in loans as provided in section 7(m).
       ``(C) For the programs authorized by title III of the Small 
     Business Investment Act of 1958, the Administration is 
     authorized to make--
       ``(i) $600,000,000 in purchases of participating 
     securities; and
       ``(ii) $500,000,000 in guarantees of debentures.
       ``(D) 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 section 411(a)(3) of that Act.
       ``(E) The Administration is authorized to make grants or 
     enter into cooperative agreements--
       ``(i) for the Service Corps of Retired Executives program 
     authorized by section 8(b)(1), $4,000,000; and
       ``(ii) for activities of small business development centers 
     pursuant to section 21(c)(3)(G), $15,000,000, to remain 
     available until expended.
       ``(2) Additional authorizations.--
       ``(A) There are authorized to be appropriated to the 
     Administration for fiscal year 1998 such sums as may be 
     necessary to carry out this Act, including administrative 
     expenses and necessary loan capital for disaster loans 
     pursuant to section 7(b), and to carry out the Small Business 
     Investment Act of 1958, including salaries and expenses of 
     the Administration.
       ``(B) Notwithstanding subparagraph (A), for fiscal year 
     1998--
       ``(i) 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
       ``(ii) 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.
       ``(d) Fiscal Year 1999.--
       ``(1) Program levels.--The following program levels are 
     authorized for fiscal year 1999:
       ``(A) For the programs authorized by this Act, the 
     Administration is authorized to make--
       ``(i) $28,000,000 in technical assistance grants as 
     provided in section 7(m); and
       ``(ii) $60,000,000 in loans, as provided in section 7(m).
       ``(B) For the programs authorized by this Act, the 
     Administration is authorized to make $18,540,000,000 in 
     deferred participation loans and other financings. Of such 
     sum, the Administration is authorized to make--
       ``(i) $14,000,000,000 in general business loans as provided 
     in section 7(a);
       ``(ii) $3,500,000,000 in financings as provided in section 
     7(a)(13) of this Act and section 504 of the Small Business 
     Investment Act of 1958;
       ``(iii) $1,000,000,000 in loans as provided in section 
     7(a)(21); and
       ``(iv) $40,000,000 in loans as provided in section 7(m).
       ``(C) For the programs authorized by title III of the Small 
     Business Investment Act of

[[Page S8980]]

     1958, the Administration is authorized to make--
       ``(i) $700,000,000 in purchases of participating 
     securities; and
       ``(ii) $650,000,000 in guarantees of debentures.
       ``(D) 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 section 411(a)(3) of that Act.
       ``(E) The Administration is authorized to make grants or 
     enter cooperative agreements--
       ``(i) for the Service Corps of Retired Executives program 
     authorized by section 8(b)(1), $4,500,000; and
       ``(ii) 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.
       ``(2) Additional authorizations.--
       ``(A) There are authorized to be appropriated to the 
     Administration for fiscal year 1999 such sums as may be 
     necessary to carry out this Act, including administrative 
     expenses and necessary loan capital for disaster loans 
     pursuant to section 7(b), and to carry out the Small Business 
     Investment Act of 1958, including salaries and expenses of 
     the Administration.
       ``(B) Notwithstanding subparagraph (A), for fiscal year 
     1999--
       ``(i) 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
       ``(ii) 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.
       ``(e) Fiscal Year 2000.--
       ``(1) Program levels.--The following program levels are 
     authorized for fiscal year 2000:
       ``(A) For the programs authorized by this Act, the 
     Administration is authorized to make--
       ``(i) $28,000,000 in technical assistance grants as 
     provided in section 7(m); and
       ``(ii) $60,000,000 in direct loans, as provided in section 
     7(m).
       ``(B) For the programs authorized by this Act, the 
     Administration is authorized to make $21,040,000,000 in 
     deferred participation loans and other financings. Of such 
     sum, the Administration is authorized to make--
       ``(i) $15,500,000,000 in general business loans as provided 
     in section 7(a);
       ``(ii) $4,500,000,000 in financings as provided in section 
     7(a)(13) of this Act and section 504 of the Small Business 
     Investment Act of 1958;
       ``(iii) $1,000,000,000 in loans as provided in section 
     7(a)(21); and
       ``(iv) $40,000,000 in loans as provided in section 7(m).
       ``(C) For the programs authorized by title III of the Small 
     Business Investment Act of 1958, the Administration is 
     authorized to make--
       ``(i) $850,000,000 in purchases of participating 
     securities; and
       ``(ii) $700,000,000 in guarantees of debentures.
       ``(D) 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 section 411(a)(3) of that Act.
       ``(E) The Administration is authorized to make grants or 
     enter cooperative agreements--
       ``(i) for the Service Corps of Retired Executives program 
     authorized by section 8(b)(1), $5,000,000; and
       ``(ii) 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.
       ``(2) Additional authorizations.--
       ``(A) There are authorized to be appropriated to the 
     Administration for fiscal year 2000 such sums as may be 
     necessary to carry out this Act, including administrative 
     expenses and necessary loan capital for disaster loans 
     pursuant to section 7(b), and to carry out the Small Business 
     Investment Act of 1958, including salaries and expenses of 
     the Administration.
       ``(B) Notwithstanding subparagraph (A), for fiscal year 
     2000--
       ``(i) 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
       ``(ii) 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.''.
                     TITLE II--FINANCIAL ASSISTANCE
                     Subtitle A--Microloan Program

     SEC. 201. MICROLOAN PROGRAM.

       (a) Loan Limits.--Section 7(m)(3)(C) of the Small Business 
     Act (15 U.S.C. 636(m)(3)(C)) is amended by striking 
     ``$2,500,000'' and inserting ``$3,500,000''.
       (b) Loan Loss Reserve Fund.--Section 7(m)(3)(D) of the 
     Small Business Act (15 U.S.C. 636(m)(3)(D)) is amended by 
     striking clauses (i) and (ii), and inserting the following:
       ``(i) during the initial 5 years of the intermediary's 
     participation in the program under this subsection, at a 
     level equal to not more than 15 percent of the outstanding 
     balance of the notes receivable owed to the intermediary; and
       ``(ii) in each year of participation thereafter, at a level 
     equal to not more than the greater of--

       ``(I) 2 times an amount reflecting the total losses of the 
     intermediary as a result of participation in the program 
     under this subsection, as determined by the Administrator on 
     a case-by-case basis; or
       ``(II) 10 percent of the outstanding balance of the notes 
     receivable owed to the intermediary.''.

       (c) Authorization of Appropriations.--Section 7(m) of the 
     Small Business Act (15 U.S.C. 636(m)) is amended--
       (1) in the subsection heading, by striking 
     ``Demonstration'';
       (2) by striking ``Demonstration'' each place that term 
     appears;
       (3) by striking ``demonstration'' each place that term 
     appears; and
       (4) in paragraph (12), by striking ``during fiscal years 
     1995 through 1997'' and inserting ``during fiscal years 1998 
     through 2000''.
       (d) Technical Assistance Grants.--Section 7(m)(4)(E) of the 
     Small Business Act (15 U.S.C. 636(m)(4)(E)) is amended--
       (1) by inserting ``(i)'' before ``Each intermediary'';
       (2) by striking ``15'' and inserting ``25'';
       (3) by adding at the end of the paragraph ``(ii) The 
     intermediary may expend up to 25 percent of the funds 
     received under paragraph (1)(B)(ii) to enter into third party 
     contracts for the provision of technical assistance''.

     SEC. 202. WELFARE-TO-WORK MICROLOAN PILOT PROGRAM.

       (a) Program Establishment.--Section 7(m) of the Small 
     Business Act (15 U.S.C. 636(m)) is amended--
       (1) in paragraph (1)(A)--
       (A) in clause (ii), by striking ``and'' at the end;
       (B) in clause (iii), by striking the period at the end and 
     inserting ``; and''; and
       (C) by adding at the end the following:
       ``(iv) to establish a welfare-to-work microloan pilot 
     program, which shall be administered by the Administration, 
     in order to--

       ``(I) test the feasibility of supplementing the technical 
     assistance grants provided under clauses (ii) and (iii) of 
     subparagraph (B) to individuals who are receiving assistance 
     under the State program funded under part A of title IV of 
     the Social Security Act (42 U.S.C. 601 et seq.), or under any 
     comparable State-funded means-tested program of assistance 
     for low-income individuals, in order to adequately assist 
     those individuals in--

       ``(aa) establishing small businesses; and
       ``(bb) eliminating their dependence on that assistance;

       ``(II) permit the grants described in subclause (I) to be 
     used to provide intensive management, marketing and technical 
     assistance as well as to pay or reimburse a portion of child 
     care and transportation costs of individuals described in 
     subclause (I) who become microborrowers;
       ``(III) eliminate barriers to microborrowers in 
     establishing child care businesses; and
       ``(IV) evaluate the effectiveness of assistance provided 
     under this clause in helping individuals described in 
     subclause (I) to eliminate their dependence on assistance 
     described in that subclause and become employed in their own 
     business;'';

       (2) in paragraph (4), by adding at the end the following:
       ``(F) Supplemental grants.--
       ``(i) In general.--In addition to grants under 
     subparagraphs (A) and (C) and paragraph (5), the 
     Administration may select from participating intermediaries 
     and recipients of grants under paragraph (5), not more than 
     20 entities in fiscal year 1998, 25 entities in fiscal year 
     1999, and 30 entities in fiscal year 2000, each of whom may 
     receive annually a supplemental grant in an amount not to 
     exceed $200,000 for the purpose of providing additional 
     technical assistance and related services to borrowers who 
     are receiving assistance described in paragraph (1)(A)(iv)(I) 
     at the time they initially apply for assistance under the 
     program.
       ``(ii) Inapplicability of contribution requirements.--The 
     contribution requirements of subparagraphs (B) and (C)(i)(II) 
     do not apply to any grant made under this subparagraph.
       ``(iii) Child care and transportation costs.--Any grant 
     made under this subparagraph may be used to pay or reimburse 
     a portion of the costs of child care and transportation 
     incurred by a borrower under the welfare-to-work microloan 
     pilot program under paragraph (1)(A)(iv).'';
       (3) in paragraph (6), by adding at the end the following:
       ``(E) Establishment of child care establishments.--In 
     addition to other eligible small business concerns, borrowers 
     under

[[Page S8981]]

     any program under this subsection may include individuals who 
     will use the loan proceeds to establish for-profit or 
     nonprofit child care establishments.'';
       (4) in paragraph (9)--
       (A) by striking the paragraph designation and paragraph 
     heading and inserting the following:
       ``(9) Grants  for  management,  marketing,  technical  
     assistance,  and  related  services.--''; and
       (B) by adding at the end the following:
       ``(C) Welfare-to-work microloan pilot program.--Of amounts 
     made available to carry out the welfare-to-work microloan 
     pilot program under paragraph (1)(A)(iv) in any fiscal year, 
     the Administration may use not more than 5 percent to provide 
     technical assistance, either directly or through contractors, 
     to welfare-to-work microloan pilot program grantees, to 
     ensure that, as grantees, they have the knowledge, skills, 
     and understanding of microlending and welfare-to-work 
     transition, and other related issues, to operate a successful 
     welfare-to-work microloan pilot program.''; and
       (5) by adding at the end the following:
       ``(13) Evaluation of welfare-to-work microloan pilot 
     program.--On January 31, 1999, and annually thereafter, the 
     Administration shall submit to the Committees on Small 
     Business of the House of Representatives and the Senate a 
     report on the welfare-to-work microloan pilot program 
     authorized under paragraph (1)(A)(iv), which report shall 
     include, with respect to the preceding fiscal year, an 
     analysis of the progress and effectiveness of the program 
     during that fiscal year, and data relating to--
       ``(A) the number and location of each grantee under the 
     program;
       ``(B) the amount of each grant;
       ``(C) the number of individuals who received assistance 
     under each grant, including separate data relating to--
       ``(i) the number of individuals who received training;
       ``(ii) the number of individuals who received 
     transportation assistance; and
       ``(iii) the number of individuals who received child care 
     assistance (including the number of children assisted);
       ``(D) the type and amount of loan and grant assistance 
     received by borrowers under the program;
       ``(E) the number of businesses that were started with 
     assistance provided under the program that are operational 
     and the number of jobs created by each business;
       ``(F) the number of individuals receiving training under 
     the program who, after receiving assistance under the 
     program--
       ``(i) are employed in their own businesses; and
       ``(ii) are not receiving public assistance for themselves 
     or their children;
       ``(G) whether and to what extent each grant was used to 
     defray the transportation and child care costs of borrowers; 
     and
       ``(H) any recommendations for legislative changes to 
     improve program operations.''.
       (c) Authorization of Appropriations.--There are authorized 
     to be appropriated to carry out the welfare-to-work microloan 
     pilot program under section 7(m)(1)(A)(iv) of the Small 
     Business Act (as added by this section)--
       (1) $3,000,000 for fiscal year 1998;
       (2) $4,000,000 for fiscal year 1999; and
       (3) $5,000,000 for fiscal year 2000.
         Subtitle B--Small Business Investment Company Program

     SEC. 211. 5-YEAR COMMITMENTS FOR SBICS AT OPTION OF 
                   ADMINISTRATOR.

       Section 20(a)(2) of the Small Business Act (15 U.S.C. 631 
     note) is amended in the last sentence by striking ``the 
     following fiscal year'' and inserting ``any 1 or more of the 
     4 subsequent fiscal years''.

     SEC. 212. FEES.

       Section 301 of the Small Business Investment Act of 1958 
     (15 U.S.C. 681) is amended by adding the following:
       ``(e) Fees.--
       ``(1) In general.--The Administration may prescribe fees to 
     be paid by each applicant for a license to operate as a small 
     business investment company under this Act.
       ``(2) Use of amounts.--Amounts collected pursuant to this 
     subsection shall be--
       ``(A) deposited in the account for salaries and expenses of 
     the Administration; and
       ``(B) available without further appropriation solely to 
     cover contracting and other administrative costs related to 
     licensing.''.

     SEC. 213. SMALL BUSINESS INVESTMENT COMPANY PROGRAM REFORM.

       (a) Bank Investments.--Section 302(b) of the Small Business 
     Investment Act of 1958 (15 U.S.C. 682(b)) is amended by 
     striking ``1956,'' and all that follows before the period and 
     inserting the following: ``1956, any national bank, or any 
     member bank of the Federal Reserve System or nonmember 
     insured bank to the extent permitted under applicable State 
     law, may invest in any 1 or more small business investment 
     companies, or in any entity established to invest solely in 
     small business investment companies, except that in no event 
     shall the total amount of such investments of any such bank 
     exceed 5 percent of the capital and surplus of the bank''.
       (b) Indexing for Leverage.--Section 303 of the Small 
     Business Investment Act of 1958 (15 U.S.C. 683) is amended--
       (1) in subsection (b)--
       (A) in paragraph (2), by adding at the end the following:
       ``(D)(i) The dollar amounts in subparagraphs (A), (B), and 
     (C) shall be adjusted annually to reflect increases in the 
     Consumer Price Index established by the Bureau of Labor 
     Statistics of the Department of Labor.
       ``(ii) The initial adjustments made under this subparagraph 
     after the date of enactment of the Small Business 
     Reauthorization Act of 1997 shall reflect only increases from 
     March 31, 1993.''; and
       (B) by striking paragraph (4) and inserting the following:
       ``(4) Maximum aggregate amount of leverage.--
       ``(A) In general.--Except as provided in subparagraph (B), 
     the aggregate amount of outstanding leverage issued to any 
     company or companies that are commonly controlled (as 
     determined by the Administrator) may not exceed $90,000,000, 
     as adjusted annually for increases in the Consumer Price 
     Index.
       ``(B) Exceptions.--The Administrator may, on a case-by-case 
     basis--
       ``(i) approve an amount of leverage that exceeds the amount 
     described in subparagraph (A) for companies under common 
     control; and
       ``(ii) impose such additional terms and conditions as the 
     Administrator determines to be appropriate to minimize the 
     risk of loss to the Administration in the event of default.
       ``(C) Applicability of other provisions.--Any leverage that 
     is issued to a company or companies commonly controlled in an 
     amount that exceeds $90,000,000, whether as a result of an 
     increase in the Consumer Price Index or a decision of the 
     Administrator, is subject to subsection (d).''; and
       (2) by striking subsection (d) and inserting the following:
       ``(d) Required Certifications.--
       ``(1) In general.--The Administrator shall require each 
     licensee, as a condition of approval of an application for 
     leverage, to certify in writing--
       ``(A) for licensees with leverage less than or equal to 
     $90,000,000, that not less than 20 percent of the licensee's 
     aggregate dollar amount of financings will be provided to 
     smaller enterprises; and
       ``(B) for licensees with leverage in excess of $90,000,000, 
     that, in addition to satisfying the requirements of 
     subparagraph (A), 100 percent of the licensee's aggregate 
     dollar amount of financings made in whole or in part with 
     leverage in excess of $90,000,000 will be provided to smaller 
     enterprises as defined in section 103(12).
       ``(2) Multiple licensees.--Multiple licensees under common 
     control (as determined by the Administrator) shall be 
     considered to be a single licensee for purposes of 
     determining both the applicability of and compliance with the 
     investment percentage requirements of this subsection.''.
       (c) Tax Distributions.--Section 303(g)(8) of the Small 
     Business Investment Act of 1958 (15 U.S.C. 683(g)(8)) is 
     amended by adding at the end the following: ``A company may 
     also elect to make a distribution under this paragraph at the 
     end of any calendar quarter based on a quarterly estimate of 
     the maximum tax liability. If a company makes 1 or more 
     quarterly distributions for a calendar year, and the 
     aggregate amount of those distributions exceeds the maximum 
     amount that the company could have distributed based on a 
     single annual computation, any subsequent distribution by the 
     company under this paragraph shall be reduced by an amount 
     equal to the excess amount distributed.''.
       (d) Leverage Fee.--Section 303(i) of the Small Business 
     Investment Act of 1958 (15 U.S.C. 683(i)) is amended by 
     striking ``, payable upon'' and all that follows before the 
     period and inserting the following: ``in the following 
     manner: 1 percent upon the date on which the Administration 
     enters into any commitment for such leverage with the 
     licensee, and the balance of 2 percent (or 3 percent if no 
     commitment has been entered into by the Administration) on 
     the date on which the leverage is drawn by the licensee''.
       (e) Periodic Issuance of Guarantees and Trust 
     Certificates.--Section 320 of the Small Business Investment 
     Act of 1958 (15 U.S.C. 687m) is amended by striking ``three 
     months'' and inserting ``6 months''.

     SEC. 214. EXAMINATION FEES.

       Section 310(b) of the Small Business Investment Act of 1958 
     (15 U.S.C. 687b(b)) is amended by inserting after the first 
     sentence the following: ``Fees collected under this 
     subsection shall be deposited in the account for salaries and 
     expenses of the Administration, and shall be available 
     without further appropriation solely to cover the costs of 
     examinations and other program oversight activities.''.
           Subtitle C--Certified Development Company Program

     SEC. 221. LOANS FOR PLANT ACQUISITION, CONSTRUCTION, 
                   CONVERSION, AND EXPANSION.

       Section 502 of the Small Business Investment Act of 1958 
     (15 U.S.C. 696) is amended--
       (1) by striking paragraph (1) and inserting the following:
       ``(1) The proceeds of any such loan shall be used solely by 
     the borrower to assist 1 or more identifiable small business 
     concerns and for a sound business purpose approved by the 
     Administration.'';
       (2) in paragraph (3), by adding at the end the following:
       ``(D) Seller financing.--Seller-provided financing may be 
     used to meet the requirements of subparagraph (B), if the 
     seller subordinates the interest of the seller in the 
     property to the debenture guaranteed by the Administration.

[[Page S8982]]

       ``(E) Collateral requirements.--Adequacy of collateral 
     provided by the small business shall be one factor evaluated 
     in the credit determination. Collateral provided by the small 
     business concern generally will include a subordinate lien 
     position on the property being financed, and additional 
     collateral may be required in a case-by-case basis, as 
     determined by the Administration.''; and
       (3) by adding at the end the following:
       ``(5) Except as provided in paragraph (4), not to exceed 25 
     percent of the project may be leased by the assisted small 
     business, if--
       ``(A) the assisted small business is required to occupy 
     permanently and use not less than 75 percent of the space in 
     the project after the execution of any leases authorized in 
     this paragraph; and
       ``(B) each tenant is engaged a business that enhances the 
     operations of the assisted small business.''.

     SEC. 222. DEVELOPMENT COMPANY DEBENTURES.

       Section 503 of the Small Business Investment Act of 1958 
     (15 U.S.C. 697) is amended--
       (1) in subsection (b)(7), by striking subparagraph (A) and 
     inserting the following:
       ``(A) assesses and collects a fee, which shall be payable 
     by the borrower, in an amount established annually by the 
     Administration, which amount shall not exceed the lesser of--
       ``(i) 0.9375 percent per year of the outstanding balance of 
     the loan; and
       ``(ii) the minimum amount necessary to reduce the cost (as 
     that term is defined in section 502 of the Federal Credit 
     Reform Act of 1990) to the Administration of purchasing and 
     guaranteeing debentures under this Act to zero; and''; and
       (2) in subsection (f), by striking ``1997'' and inserting 
     ``2000''.

     SEC. 223. PREMIER CERTIFIED LENDERS PROGRAM.

       (a) In General.--Section 508 of the Small Business 
     Investment Act of 1958 (15 U.S.C. 697e) is amended--
       (1) in subsection (a), by striking ``not more than 15'';
       (2) in subsection (b)(2), by striking subparagraphs (A) and 
     (B) and inserting the following:
       ``(A) is an active certified development company in good 
     standing and has been an active participant in the accredited 
     lenders program during the entire 12-month period preceding 
     the date on which the company submits an application under 
     paragraph (1), except that the Administration may waive this 
     requirement if the company is qualified to participate in the 
     accredited lenders program;
       ``(B) has a history of--
       ``(i) submitting to the Administration adequately analyzed 
     debenture guarantee application packages; and
       ``(ii) of properly closing section 504 loans and servicing 
     its loan portfolio; and'';
       (3) by striking subsection (c) and inserting the following:
       ``(c) Loss Reserve.--
       ``(1) Establishment.--A company designated as a premier 
     certified lender shall establish a loss reserve for financing 
     approved pursuant to this section.
       ``(2) Amount.--The amount of 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 any 
     combination of the following types of assets:
       ``(A) segregated funds on deposit in an account or accounts 
     with a federally insured depository institution or 
     institutions selected by the company, subject to a collateral 
     assignment in favor of, and in a format acceptable to, the 
     Administration; or
       ``(B) irrevocable letter or letters of credit, with a 
     collateral assignment in favor of, and a commercially 
     reasonable format acceptable to, the Administration.
       ``(4) Contributions.--The company shall make contributions 
     to the loss reserve, either cash or letters of credit as 
     provided above, in the following amounts and at the following 
     intervals:
       ``(A) 50 percent when a debenture is closed;
       ``(B) 25 percent additional not later than 1 year after a 
     debenture is closed; and
       ``(C) 25 percent additional not later than 2 years after a 
     debenture is closed.
       ``(5) Replenishment.--If a loss has been sustained by the 
     Administration, any portion of the loss reserve, and other 
     funds provided by the premier company as necessary, may be 
     used to reimburse the Administration for the company's 10 
     percent share of the loss as provided in subsection 
     (b)(2)(C). If the company utilizes the reserve, within 30 
     days it shall replace an equivalent amount of funds.
       ``(6) Disbursements.--The Administration shall allow the 
     certified development company to withdraw from the loss 
     reserve amounts attributable to any debenture which has been 
     repaid.'';
       (4) in subsection (f), by striking ``State or local'' and 
     inserting ``certified'';
       (5) in subsection (g), by striking the subsection heading 
     and inserting the following:
       ``(g) Effect of Suspension or Revocation.--'';
       (6) by striking subsection (h) and inserting the following:
       ``(h) Program Goals.--Each certified development company 
     participating in the program under this section shall 
     establish a goal of processing a minimum of not less than 50 
     percent of the loan applications for assistance under section 
     504 pursuant to the program authorized under this section.''; 
     and
       (7) in subsection (i), by striking ``other lenders'' and 
     inserting ``other lenders, specifically comparing default 
     rates and recovery rates on liquidations''.
       (b) Regulations.--The Administrator of the Small Business 
     Administration shall--
       (1) not later than 120 days after the date of enactment of 
     this Act, promulgate regulations to carry out the amendments 
     made by subsection (a); and
       (2) not later than 150 days after the date of enactment of 
     this Act, issue program guidelines and fully implement the 
     amendments made by subsection (a).
       (c) Program Extension.--Section 217(b) of the Small 
     Business Reauthorization and Amendments Act of 1994 (15 
     U.S.C. 697e note) is amended by striking ``October 1, 1997'' 
     and inserting ``October 1, 2000''.
                TITLE III--WOMEN'S BUSINESS ENTERPRISES

     SEC. 301. INTERAGENCY COMMITTEE PARTICIPATION.

       Section 403 of the Women's Business Ownership Act of 1988 
     (15 U.S.C. 631 note) is amended--
       (1) in subsection (a)(1), by adding at the end the 
     following:
       ``(K) The Department of Education.
       ``(L) The Environmental Protection Agency.
       ``(M) The Department of Energy.
       ``(N) The Administrator of the Office of Procurement 
     Policy.
       ``(O) The National Aeronautics and Space Administration.'';
       (2) in subsection (a)(2)(A)--
       (A) by striking ``and Amendments Act of 1994'' and 
     inserting ``Act of 1997''; and
       (B) by inserting before the final period ``, and who shall 
     report directly to the head of the agency on the status of 
     the activities of the Interagency Committee'';
       (3) in subsection (a)(2)(B), by inserting before the final 
     period the following: ``and shall report directly to the 
     Administrator on the status of the activities on the 
     Interagency Committee and shall serve as the Interagency 
     Committee Liaison to the National Women's Business Council 
     established under section 405''; and
       (4) in subsection (b), by striking ``and Amendments Act of 
     1994'' and inserting ``Act of 1997''.

     SEC. 302. REPORTS.

       Section 404 of the Women's Business Ownership Act of 1988 
     (15 U.S.C. 631 note) is amended--
       (1) by inserting ``, through the Small Business 
     Administration,'' after ``transmit'';
       (2) by striking paragraph (1) and redesignating paragraphs 
     (2) through (4) as paragraphs (1) through (3), respectively; 
     and
       (3) in paragraph (1), as redesignated, by inserting before 
     the semicolon the following: ``, including a status report on 
     the progress of the Interagency Committee in meeting its 
     responsibilities and duties under section 402(a)''.

     SEC. 303. COUNCIL DUTIES.

       Section 406 of the Women's Business Ownership Act of 1988 
     (15 U.S.C. 631 note) is amended--
       (1) in subsection (c), by inserting after ``Administrator'' 
     the following: ``(through the Assistant Administrator for the 
     Office of Women's Business Ownership)''; and
       (2) in subsection (d)--
       (A) in paragraph (4), by striking ``and'' at the end;
       (B) in paragraph (5), by striking the period at the end and 
     inserting a semicolon; and
       (C) by adding at the end the following:
       ``(6) submit to the President and to the Committee on Small 
     Business of the Senate and the Committee on Small Business of 
     the House of Representatives, an annual report containing--
       ``(A) a detailed description of the activities of the 
     council, including a status report on the Council's progress 
     toward meeting its duties outlined in subsections (a) and (d) 
     of section 406;
       ``(B) the findings, conclusions, and recommendations of the 
     Council; and
       ``(C) the Council's recommendations for such legislation 
     and administrative actions as the Council considers 
     appropriate to promote the development of small business 
     concerns owned and controlled by women.
       ``(e) Submission of Reports.--The annual report required by 
     subsection (d) shall be submitted not later than 90 days 
     after the end of each fiscal year.''.

     SEC. 304. COUNCIL MEMBERSHIP.

       Section 407 of the Women's Business Ownership Act of 1988 
     (15 U.S.C. 631 note) is amended--
       (1) in subsection (a), by striking ``and Amendments Act of 
     1994'' and inserting ``Act of 1997'';
       (2) in subsection (b)--
       (A) by striking ``and Amendments Act of 1994'' and 
     inserting ``Act of 1997'';
       (B) by inserting after ``the Administrator shall'' the 
     following: ``, after receiving the recommendations of the 
     Chair and the Ranking Member of the Minority of the 
     Committees on Small Business of the House of Representatives 
     and the Senate, '';
       (C) by striking ``9'' and inserting ``14'';
       (D) in paragraph (1), by striking ``2'' and inserting 
     ``3'';
       (E) in paragraph (2)--
       (i) by striking ``2'' and inserting ``3''; and
       (ii) by striking ``and'' at the end;

[[Page S8983]]

       (F) in paragraph (3)--
       (i) by striking ``5'' and inserting ``6'';
       (ii) by striking ``national''; and
       (iii) by striking the period at the end and inserting the 
     following: ``, including representatives of Women's Business 
     Center sites; and''; and
       (G) by adding at the end the following:
       ``(4) 2 shall be representatives of businesses or 
     educational institutions having an interest in women's 
     entrepreneurship.''; and
       (3) in subsection (c), by inserting ``(including both urban 
     and rural areas)'' after ``geographic''.

     SEC. 305. AUTHORIZATION OF APPROPRIATIONS.

       Section 409 of the Women's Business Ownership Act of 1988 
     (15 U.S.C. 631 note) is amended--
       (1) by striking ``1995 through 1997'' and inserting ``1998 
     through 2000''; and
       (2) by striking ``$350,000'' and inserting ``$400,000''.

     SEC. 306. WOMEN'S BUSINESS CENTERS.

       (a) In General.--Section 29 of the Small Business Act (15 
     U.S.C. 656) is amended to read as follows:

     ``SEC. 29. WOMEN'S BUSINESS CENTERS.

       ``(a) Definitions.--In this section--
       ``(1) the term `small business concern owned and controlled 
     by women', either startup or existing, includes any small 
     business concern--
       ``(A) that is not less than 51 percent owned by 1 or more 
     women; and
       ``(B) the management and daily business operations of which 
     are controlled by 1 or more women; and
       ``(2) the term `women's business center site' means the 
     location of--
       ``(A) a women's business center; or
       ``(B) 1 or more women's business centers, established in 
     conjunction with another women's business center in another 
     location within a State or region--
       ``(i) that reach a distinct population that would otherwise 
     not be served;
       ``(ii) whose services are targeted to women; and
       ``(iii) whose scope, function, and activities are similar 
     to those of the primary women's business center or centers in 
     conjunction with which it was established.
       ``(b) Authority.--The Administration may provide financial 
     assistance to private organizations to conduct 5-year 
     projects for the benefit of small business concerns owned and 
     controlled by women. The projects shall provide--
       ``(1) financial assistance, including training and 
     counseling in how to apply for and secure business credit and 
     investment capital, preparing and presenting financial 
     statements, and managing cash flow and other financial 
     operations of a business concern;
       ``(2) management assistance, including training and 
     counseling in how to plan, organize, staff, direct, and 
     control each major activity and function of a small business 
     concern; and
       ``(3) marketing assistance, including training and 
     counseling in identifying and segmenting domestic and 
     international market opportunities, preparing and executing 
     marketing plans, developing pricing strategies, locating 
     contract opportunities, negotiating contracts, and utilizing 
     varying public relations and advertising techniques.
       ``(c) Conditions of Participation.--
       ``(1) Non-federal contributions.--As a condition of 
     receiving financial assistance authorized by this section, 
     the recipient organization shall agree to obtain, after its 
     application has been approved and notice of award has been 
     issued, cash contributions from non-Federal sources as 
     follows:
       ``(A) in the first, second, and third years, 1 non-Federal 
     dollar for each 2 Federal dollars;
       ``(B) in the fourth year, 1 non-Federal dollar for each 
     Federal dollar; and
       ``(C) in the fifth year, 2 non-Federal dollars for each 
     Federal dollar.
       ``(2) Form of non-federal contributions.--Not more than 
     one-half of the non-Federal sector matching assistance may be 
     in the form of in-kind contributions which are budget line 
     items only, including but not limited to office equipment and 
     office space.
       ``(3) Form of federal contributions.--The financial 
     assistance authorized pursuant to this section may be made by 
     grant, contract, or cooperative agreement and may contain 
     such provision, as necessary, to provide for payments in lump 
     sum or installments, and in advance or by way of 
     reimbursement. The Administration may disburse up to 25 
     percent of each year's Federal share awarded to a recipient 
     organization after notice of the award has been issued and 
     before the non-Federal sector matching funds are obtained.
       ``(4) Failure to obtain private funding.--If any recipient 
     of assistance fails to obtain the required non-Federal 
     contribution during any project, it shall not be eligible 
     thereafter for advance disbursements pursuant to paragraph 
     (3) during the remainder of that project, or for any other 
     project for which it is or may be funded by the 
     Administration, and prior to approving assistance to such 
     organization for any other projects, the Administration shall 
     specifically determine whether the Administration believes 
     that the recipient will be able to obtain the requisite non-
     Federal funding and enter a written finding setting forth the 
     reasons for making such determination.
       ``(d) Contract Authority.--A women's business center may 
     enter into a contract with a Federal department or agency to 
     provide specific assistance to women and other underserved 
     small business concerns. Performance of such contract should 
     not hinder the women's business centers in carrying out the 
     terms of the grant received by the women's business centers 
     from the Administration.
       ``(e) Submission of 5-Year Plan.--Each applicant 
     organization initially shall submit a 5-year plan to the 
     Administration on proposed fundraising and training 
     activities, and a recipient organization may receive 
     financial assistance under this program for a maximum of 5 
     years per women's business center site.
       ``(f) Criteria.--The Administration shall evaluate and rank 
     applicants in accordance with predetermined selection 
     criteria that shall be stated in terms of relative 
     importance. Such criteria and their relative importance shall 
     be made publicly available and stated in each solicitation 
     for applications made by the Administration. The criteria 
     shall include--
       ``(1) the experience of the applicant in conducting 
     programs or ongoing efforts designed to impart or upgrade the 
     business skills of women business owners or potential owners;
       ``(2) the present ability of the applicant to commence a 
     project within a minimum amount of time;
       ``(3) the ability of the applicant to provide training and 
     services to a representative number of women who are both 
     socially and economically disadvantaged; and
       ``(4) the location for the women's business center site 
     proposed by the applicant.
       ``(g) Office of Women's Business Ownership.--There is 
     established within the Administration an Office of Women's 
     Business Ownership, which shall be responsible for the 
     administration of the Administration's programs for the 
     development of women's business enterprises (as that 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.
       ``(h) Report.--The Administrator shall prepare and submit 
     an annual report to the Committees on Small Business of the 
     House of Representatives and the Senate on the effectiveness 
     of all projects conducted under the authority of this 
     section. Such report shall provide information concerning--
       ``(1) the number of individuals receiving assistance;
       ``(2) the number of startup business concerns formed;
       ``(3) the gross receipts of assisted concerns;
       ``(4) increases or decreases in profits of assisted 
     concerns; and
       ``(5) the employment increases or decreases of assisted 
     concerns.
       ``(i) Authorization of Appropriations.--There are 
     authorized to be appropriated $8,000,000 per year to carry 
     out the projects authorized by this section. Amounts 
     appropriated pursuant to this subsection are to be used 
     exclusively for grant awards and not for costs incurred by 
     the Administration for the management and administration of 
     the program. Notwithstanding any other provision of law, the 
     Administration may use such expedited acquisition methods as 
     it deems appropriate, through the Assistant Administrator of 
     the Office of Women's Business Ownership, to achieve the 
     purposes of this section, except that the Administration 
     shall ensure that all eligible sources are provided a 
     reasonable opportunity to submit proposals.''.
       (b) Applicability.--Any organization conducting a 3-year 
     project under section 29 of the Small Business Act (15 U.S.C. 
     656) on the day before the date of enactment of this Act, may 
     extend the term of that project to a total term of 5 years 
     and receive financial assistance in accordance with section 
     29(c) of the Small Business Act (as amended by this title) 
     subject to procedures established by the Administrator in 
     coordination with the Office of Women's Business Ownership 
     established under section 29 of the Small Business Act (15 
     U.S.C. 656) (as amended by this title).

     SEC. 307. OFFICE OF WOMEN'S BUSINESS OWNERSHIP.

       Section 29 of the Small Business Act (15 U.S.C. 656) is 
     amended by adding at the end the following:
       ``(i) Assistant Administrator for the Office of Women's 
     Business Ownership.--
       ``(1) Qualification.--The Assistant Administrator for the 
     Office of Women's Business Ownership (hereafter in this 
     section referred to as the `Assistant Administrator') shall 
     serve without regard to the provisions of title 5, United 
     States Code, governing appointments in the competitive 
     service, and without regard to chapter 51 and subchapter III 
     of chapter 53 of title 5, United States Code, relating to 
     classification and General Schedule pay rates, but at a rate 
     of pay not to exceed the maximum of pay payable for a 
     position at GS-17 of the General Schedule.
       ``(2) Responsibilities and duties.--
       ``(A) Responsibilities.--The responsibilities of the 
     Assistant Administrator shall be to administer the programs 
     and services of the Office of Women's Business Ownership 
     established to assist women entrepreneurs in the areas of--
       ``(i) starting and operating a small business;
       ``(ii) development of management and technical skills;
       ``(iii) seeking Federal procurement opportunities; and
       ``(iv) increasing the opportunity for access to capital.
       ``(B) Duties.--Duties of the position of the Assistant 
     Administrator shall include--
       ``(i) administering and managing the Women's Business 
     Centers program;

[[Page S8984]]

       ``(ii) recommending the annual administrative and program 
     budgets for the Office of Women's Business Ownership 
     (including the budget for the Women's Business Centers);
       ``(iii) establishing appropriate funding levels therefore;
       ``(iv) reviewing the annual budgets submitted by each 
     applicant for the Women's Business Center program;
       ``(v) selecting applicants to participate in this program;
       ``(vi) implementing this section;
       ``(vii) maintaining a clearinghouse to provide for the 
     dissemination and exchange of information between Women's 
     Business Centers;
       ``(viii) conducting program examinations of recipients of 
     grants under this section;
       ``(ix) serving as the vice chairperson of the Interagency 
     Committee on Women's Business Enterprise;
       ``(x) serving as liaison for the National Women's Business 
     Council; and
       ``(xi) advising the Administrator on appointments to the 
     Women's Business Council.
       ``(3) Consultation requirements.--In carrying out the 
     responsibilities and duties described in this subsection, the 
     Assistant Administrator shall confer with and seek the advice 
     of the Administration officials in areas served by the 
     Women's Business Centers.
       ``(j) Program Examination.--
       ``(1) In general.--Not later than 180 days after the date 
     of enactment of this subsection, the Administration shall 
     develop and implement an annual programmatic and financial 
     examination of each Women's Business Center established 
     pursuant to this section.
       ``(2) Extension of contracts.--In extending or renewing a 
     contract with a Women's Business Center, the Administration 
     shall consider the results of the examination conducted 
     pursuant to paragraph (1).
       ``(k) Contract Authority.--The authority of the 
     Administration to enter into contracts shall be in effect for 
     each fiscal year only to the extent and in the amounts as are 
     provided in advance in appropriations Acts. After the 
     Administration has entered a contract, either as a grant or a 
     cooperative agreement, with any applicant under this section, 
     it shall not suspend, terminate, or fail to renew or extend 
     any such contract unless the Administration provides the 
     applicant with written notification setting forth the reasons 
     therefore and affording the applicant an opportunity for a 
     hearing, appeal, or other administrative proceeding under 
     chapter 5 of title 5, United States Code.''.

     SEC. 308. NATIONAL WOMEN'S BUSINESS COUNCIL PROCUREMENT 
                   PROJECT.

       (a) In General.--The Women's Business Ownership Act of 1988 
     (15 U.S.C. 631 note) is amended by adding at the end the 
     following:

     ``SEC. 410. NATIONAL WOMEN'S BUSINESS COUNCIL PROCUREMENT 
                   PROJECT.

       ``(a) Procurement Project.--
       ``(1) Federal procurement study.--
       ``(A) In general.--The Council shall conduct a study on the 
     award of Federal prime contracts and subcontracts to women-
     owned businesses, which study shall include--
       ``(i) an analysis of data collected by Federal agencies on 
     contract awards to women-owned businesses;
       ``(ii) a determination of the degree to which individual 
     Federal agencies are in compliance with the 5 percent women-
     owned business procurement goal established by section 
     15(g)(1) of the Small Business Act (15 U.S.C. 644(g)(1));
       ``(iii) a determination of the types and amounts of Federal 
     contracts characteristically awarded to women-owned 
     businesses; and
       ``(iv) other relevant information relating to participation 
     of women-owned businesses in Federal procurement.
       ``(B) Submission of results.--Not later than October 1, 
     1999, the Council shall submit to the Committees on Small 
     Business of the House of Representatives and the Senate, and 
     to the President, the results of the study conducted under 
     subparagraph (A).
       ``(2) Best practices report.--Not later than March 1, 2000, 
     the Council shall submit to the Committees on Small Business 
     of the House of Representatives and the Senate, and to the 
     President, a report, which shall include--
       ``(A) an analysis of the most successful practices in 
     attracting women-owned businesses as prime contractors and 
     subcontractors by--
       ``(i) Federal agencies (as supported by findings from the 
     study required under subsection (a)(1)) in Federal 
     procurement awards; and
       ``(ii) the private sector; and
       ``(B) recommendations for policy changes in Federal 
     procurement practices, including an increase in the Federal 
     procurement goal for women-owned businesses, in order to 
     maximize the number of women-owned businesses performing 
     Federal contracts.
       ``(b) Contracting Authority.--In carrying out this section, 
     the Council may contract with 1 or more public or private 
     entities.
       ``(c) Authorization of Appropriations.--There is authorized 
     to be appropriated to carry out this section, not to exceed 
     $200,000, to remain available until expended through fiscal 
     year 2000.''.
    TITLE IV--COMPETITIVENESS PROGRAM AND PROCUREMENT OPPORTUNITIES
           Subtitle A--Small Business Competitiveness Program

     SEC. 401. PROGRAM TERM.

       Section 711(c) of the Small Business Competitiveness 
     Demonstration Program Act of 1988 (15 U.S.C. 644 note) is 
     amended by striking ``1997'' and inserting ``2000''.

     SEC. 402. MONITORING AGENCY PERFORMANCE.

       Section 712(d)(1) of the Small Business Competitiveness 
     Demonstration Program Act of 1988 (15 U.S.C. 644 note) is 
     amended to read as follows:
       ``(1) Participating agencies shall monitor the attainment 
     of their small business participation goals on an annual 
     basis. An annual review by each participating agency shall be 
     completed not later than January 31 of each year, based on 
     the data for the preceding fiscal year, from October 1 
     through September 30.''.

     SEC. 403. REPORTS TO CONGRESS.

       Section 716(a) of the Small Business Competitiveness 
     Demonstration Program Act of 1988 (15 U.S.C. 644 note) is 
     amended--
       (1) by striking ``1996'' and inserting ``2000'';
       (2) by striking ``for Federal Procurement Policy'' and 
     inserting ``of the Small Business Administration''; and
       (3) by striking ``Government Operations'' and inserting 
     ``Government Reform and Oversight''.

     SEC. 404. SMALL BUSINESS PARTICIPATION IN DREDGING.

       Section 722(a) of the Small Business Competitiveness 
     Demonstration Program Act of 1988 (15 U.S.C. 644 note) is 
     amended by striking ``1996'' and inserting ``2000''.
      Subtitle B--Small Business Procurement Opportunities Program

     SEC. 411. CONTRACT BUNDLING.

       Section 2 of the Small Business Act (15 U.S.C. 631) is 
     amended by adding at the end the following:
       ``(j) In complying with the statement of congressional 
     policy expressed in subsection (a), relating to fostering the 
     participation of small business concerns in the contracting 
     opportunities of the Government, each Federal agency, to the 
     maximum extent practicable, shall--
       ``(1) comply with congressional intent to foster the 
     participation of small business concerns as prime 
     contractors, subcontractors, and suppliers;
       ``(2) structure its contracting requirements to facilitate 
     competition by and among small business concerns, taking all 
     reasonable steps to eliminate obstacles to their 
     participation; and
       ``(3) avoid unnecessary and unjustified bundling of 
     contract requirements that precludes small business 
     participation in procurements as prime contractors.''.

     SEC. 412. DEFINITION OF CONTRACT BUNDLING.

       Section 3 of the Small Business Act (15 U.S.C. 632) is 
     amended by adding at the end the following:
       ``(o) Definitions of Bundling of Contract Requirements and 
     Related Terms.--In this Act--
       ``(1) The term `bundling of contract requirements' means 
     consolidating two or more procurement requirements for goods 
     or services previously provided or performed under separate 
     smaller contracts into a solicitation of offers for a single 
     contract that is likely to be unsuitable for award to a 
     small-business concern due to--
       ``(A) the diversity, size, or specialized nature of the 
     elements of the performance specified;
       ``(B) the aggregate dollar value of the anticipated award;
       ``(C) the geographical dispersion of the contract 
     performance sites; or
       ``(D) any combination of the factors described in 
     subparagraphs (A), (B), and (C).
       ``(2) The term `separate smaller contract', with respect to 
     a bundling of contract requirements, means a contract that 
     has been performed by one or more small business concerns or 
     was suitable for award to one or more small business 
     concerns.
       ``(3) The term `bundled contract' means a contract that is 
     entered into to meet requirements that are consolidated in a 
     bundling of contract requirements.''.

     SEC. 413. ASSESSING PROPOSED CONTRACT BUNDLING.

       (a) In General.--Section 15 of the Small Business Act (15 
     U.S.C. 644) is amended by inserting after subsection (d) the 
     following new subsection (e):
       ``(e) Procurement Strategies; Contract Bundling.--
       ``(1) In general.--To the maximum extent practicable, 
     procurement strategies used by the various agencies having 
     contracting authority shall facilitate the maximum 
     participation of small business concerns as prime 
     contractors, subcontractors, and suppliers.
       ``(2) Market research.--
       ``(A) In general.--Before proceeding with an acquisition 
     strategy that could lead to a contract containing 
     consolidated procurement requirements, the head of an agency 
     shall conduct market research to determine whether 
     consolidation of the requirements is necessary and justified.
       ``(B) Factors.--For purposes of subparagraph (A), 
     consolidation of the requirements may be determined as being 
     necessary and justified if, as compared to the benefits that 
     would be derived from contracting to meet those requirements 
     if not consolidated, the Federal Government would derive from 
     the consolidation measurably substantial benefits, including 
     any combination of benefits that, in combination, are 
     measurably substantial. Benefits described in the preceding 
     sentence may include the following:
       ``(i) Cost savings.

[[Page S8985]]

       ``(ii) Quality improvements.
       ``(iii) Reduction in acquisition cycle times.
       ``(iv) Better terms and conditions.
       ``(v) Any other benefits.
       ``(C) Reduction of costs not determinative.--The reduction 
     of administrative or personnel costs alone shall not be a 
     justification for bundling of contract requirements unless 
     the cost savings are expected to be substantial in relation 
     to the dollar value of the procurement requirements to be 
     consolidated.
       ``(3) Strategy specifications.--If the head of a 
     contracting agency determines that a proposed procurement 
     strategy for a procurement involves a substantial bundling of 
     contract requirements, the proposed procurement strategy 
     shall--
       ``(A) identify specifically the benefits anticipated to be 
     derived from the bundling of contract requirements;
       ``(B) set forth an assessment of the specific impediments 
     to participation by small business concerns as prime 
     contractors that result from the bundling of contract 
     requirements and specify actions designed to maximize small 
     business participation as subcontractors (including 
     suppliers) at various tiers under the contract or contracts 
     that are awarded to meet the requirements; and
       ``(C) include a specific determination that the anticipated 
     benefits of the proposed bundled contract justify its use.
       ``(4) Contract teaming.--In the case of a solicitation of 
     offers for a bundled contract that is issued by the head of 
     an agency, a small-business concern may submit an offer that 
     provides for use of a particular team of subcontractors for 
     the performance of the contract. The head of the agency shall 
     evaluate the offer in the same manner as other offers, with 
     due consideration to the capabilities of all of the proposed 
     subcontractors. When a small business concern teams under 
     this paragraph, it shall not affect its status as a small 
     business concern for any other purpose.''.
       (b) Administration Review.--The third sentence of 
     subsection (a) of such section is amended--
       (1) by inserting after ``discrete construction projects,'' 
     the following: ``or the solicitation involves an unnecessary 
     or unjustified bundling of contract requirements, as 
     determined by the Administration,'';
       (2) by striking out ``or (4)'' and inserting in lieu 
     thereof ``(4)''; and
       (3) by inserting before the period at the end the 
     following: ``, or (5) why the agency has determined that the 
     bundled contract (as defined in section 3(o)) is necessary 
     and justified''.
       (c) Responsibilities of Agency Small Business Advocates.--
     Subsection (k) of such section is amended--
       (1) by redesignating paragraphs (5) through (9) as 
     paragraphs (6) through (10), respectively; and
       (2) by inserting after paragraph (4) the following:
       ``(5) identify proposed solicitations that involve 
     significant bundling of contract requirements, and work with 
     the agency acquisition officials and the Administration to 
     revise the procurement strategies for such proposed 
     solicitations where appropriate to increase the probability 
     of participation by small businesses as prime contractors, or 
     to facilitate small business participation as subcontractors 
     and suppliers, if a solicitation for a bundled contract is to 
     be issued;''.

     SEC. 414. REPORTING OF BUNDLED CONTRACT OPPORTUNITIES.

       (a) Data Collection Required.--The Federal Procurement Data 
     System described in section 6(d)(4)(A) of the Office of 
     Federal Procurement Policy Act (41 U.S.C. 405(d)(4)(A)) shall 
     be modified to collect data regarding bundling of contract 
     requirements when the contracting officer anticipates that 
     the resulting contract price, including all options, is 
     expected to exceed $5,000,000. The data shall reflect a 
     determination made by the contracting officer regarding 
     whether a particular solicitation constitutes a contract 
     bundling.
       (b) Definitions.--In this section, the term ``bundling of 
     contract requirements'' has the meaning given that term in 
     section 3(o) of the Small Business Act (15 U.S.C. 632(o)) (as 
     added by section 412 of this title).

     SEC. 415. EVALUATING SUBCONTRACT PARTICIPATION IN AWARDING 
                   CONTRACTS.

       Section 8(d)(4) of the Small Business Act (15 U.S.C. 
     637(d)(4)) is amended by adding at the end the following:
       ``(G) The following factors shall be designated by the 
     Federal agency as significant factors for purposes of 
     evaluating offers for a bundled contract where the head of 
     the agency determines that the contract offers a significant 
     opportunity for subcontracting:
       ``(i) A factor that is based on the rate provided under the 
     subcontracting plan for small business participation in the 
     performance of the contract.
       ``(ii) For the evaluation of past performance of an 
     offeror, a factor that is based on the extent to which the 
     offeror attained applicable goals for small business 
     participation in the performance of contracts.''.

     SEC. 416. IMPROVED NOTICE OF SUBCONTRACTING OPPORTUNITIES.

       (a) Use of the Commerce Business Daily Authorized.--Section 
     8 of the Small Business Act (15 U.S.C. 637) is amended by 
     adding at the end the following:
       ``(k) Notices of Subcontracting Opportunities.--
       ``(1) In general.--Notices of subcontracting opportunities 
     may be submitted for publication in the Commerce Business 
     Daily by--
       ``(A) a business concern awarded a contract by an executive 
     agency subject to subsection (e)(1)(C); and
       ``(B) a business concern which is a subcontractor or 
     supplier (at any tier) to such contractor having a 
     subcontracting opportunity in excess of $10,000.
       ``(2) Content of notice.--The notice of a subcontracting 
     opportunity shall include--
       ``(A) a description of the business opportunity that is 
     comparable to the description specified in paragraphs (1), 
     (2), (3), and (4) of subsection (f); and
       ``(B) the due date for receipt of offers.''.
       (b) Regulations Required.--The Federal Acquisition 
     Regulation shall be amended to provide uniform implementation 
     of the amendments made by this section.
       (c) Conforming Amendment.--Section 8(e)(1)(C) of the Small 
     Business Act (15 U.S.C. 637(e)(1)(C)) is amended by striking 
     ``$25,000'' each place that term appears and inserting 
     ``$100,000''.

     SEC. 417. DEADLINES FOR ISSUANCE OF REGULATIONS.

       (a) Proposed Regulations.--Proposed amendments to the 
     Federal Acquisition Regulation or proposed Small Business 
     Administration regulations under this subtitle and the 
     amendments made by this subtitle shall be published not later 
     than 120 days after the date of enactment of this Act for the 
     purpose of obtaining public comment pursuant to section 22 of 
     the Office of Federal Procurement Policy Act (41 U.S.C. 
     418b), or chapter 5 of title 5, United States Code, as 
     appropriate. The public shall be afforded not less than 60 
     days to submit comments.
       (b) Final Regulations.--Final regulations shall be 
     published not later than 270 days after the date of enactment 
     of this Act. The effective date for such final regulations 
     shall be not less than 30 days after the date of publication.
                   TITLE V--MISCELLANEOUS PROVISIONS

     SEC. 501. SMALL BUSINESS TECHNOLOGY TRANSFER PROGRAM.

       (a) Required Expenditures.--Section 9(n) of the Small 
     Business Act (15 U.S.C. 638(n)) is amended by striking 
     paragraph (1) and inserting the following:
       ``(1) Required expenditure amounts.--With respect to fiscal 
     years 1998, 1999, 2000, 2001, 2002, or 2003, each Federal 
     agency that has an extramural budget for research, or 
     research and development, in excess of $1,000,000,000 for 
     that fiscal year, is authorized to expend with small business 
     concerns not less than 0.15 percent of that extramural budget 
     specifically in connection with STTR programs that meet the 
     requirements of this section and any policy directives and 
     regulations issued under this section.''.
       (b) Pilot Program.--
       (1) In general.--Section 9 of the Small Business Act (15 
     U.S.C. 638) is amended by adding at the end the following:
       ``(s) Pilot Program.--
       ``(1) Definition of eligible state.--In this subsection, 
     the term `eligible State' means a State--
       ``(A) if the total value of contracts awarded to the State 
     during fiscal year 1995 under this section was less than 
     $5,000,000; and
       ``(B) that certifies to the Federal agency described in 
     paragraph (2) that the State will, upon receipt of assistance 
     under this subsection, provide matching funds from non-
     Federal sources in an amount that is not less than 50 percent 
     of the amount provided under this subsection.
       ``(2) Program authority.--Of amounts made available to 
     carry out this section for fiscal year 1998, 1999, or 2000, 
     the Administrator may expend with eligible States not more 
     than $2,000,000 in each such fiscal year in order to increase 
     the participation of small business concerns located in those 
     States in the programs under this section.
       ``(3) Amount of assistance.--The amount of assistance 
     provided to an eligible State under this subsection in any 
     fiscal year--
       ``(A) shall be equal to twice the total amount of matching 
     funds from non-Federal sources provided by the State; and
       ``(B) shall not exceed $100,000.
       ``(4) Use of assistance.--Assistance provided to an 
     eligible State under this subsection shall be used by the 
     State, in consultation with State and local departments and 
     agencies, for programs and activities to increase the 
     participation of small business concerns located in the State 
     in the programs under this section, including--
       ``(A) the establishment of quantifiable performance goals, 
     including goals relating to--
       ``(i) the number of program awards under this section made 
     to small business concerns in the State; and
       ``(ii) the total amount of Federal research and development 
     contracts awarded to small business concerns in the State;
       ``(B) the provision of competition outreach support to 
     small business concerns in the State that are involved in 
     research and development; and
       ``(C) the development and dissemination of educational and 
     promotional information relating to the programs under this 
     section to small business concerns in the State.''.
       (2) Repeal.--Effective October 1, 2000, section 9(s) of the 
     Small Business Act (as added by paragraph (1) of this 
     subsection) is repealed.

     SEC. 502. SMALL BUSINESS DEVELOPMENT CENTERS.

       (a) In General.--Section 21(a) of the Small Business Act 
     (15 U.S.C. 648(a)) is amended--
       (1) in paragraph (1)--

[[Page S8986]]

       (A) by inserting ``any women's business center operating 
     pursuant to section 29,'' after ``credit or finance 
     corporation,'';
       (B) by inserting ``or a women's business center operating 
     pursuant to section 29'' after ``other than an institution of 
     higher education''; and
       (C) by inserting ``and women's business centers operating 
     pursuant to section 29'' after ``utilize institutions of 
     higher education'';
       (2) in paragraph (3)--
       (A) by striking ``, but with'' and all that follows through 
     ``parties.'' and inserting the following: ``for the delivery 
     of programs and services to the Small Business community. 
     Such programs and services shall be jointly developed, 
     negotiated, and agreed upon, with full participation of both 
     parties, pursuant to an executed cooperative agreement 
     between the Small Business Development Center applicant and 
     the Administration.''; and
       (B) by adding at the end the following:
       ``(C) On an annual basis, the Small Business Development 
     Center shall review and coordinate public and private 
     partnerships and cosponsorships with the Administration for 
     the purpose of more efficiently leveraging available 
     resources on a National and a State basis.'';
       (3) in paragraph (4)(C)--
       (A) by striking clause (i) and inserting the following:
       ``(i) In general.--
       ``(I) Grant amount.--Subject to subclause (II), the amount 
     of a grant received by a State under this section shall be 
     equal to the greater of $500,000, or the sum of--

       ``(aa) the State's pro rata share of the national program, 
     based upon the population of the State as compared to the 
     total population of the United States; and
       ``(bb) $300,000 in fiscal year 1998, $400,000 in fiscal 
     year 1999, and $500,000 in each fiscal year thereafter.

       ``(II) Pro rata reductions.--If the amount made available 
     to carry out this section for any fiscal year is insufficient 
     to carry out subclause (I), the Administration shall make pro 
     rata reductions in the amounts otherwise payable to States 
     under this clause.''; and
       (B) in clause (iii), by striking ``(iii)'' and all that 
     follows through ``1997.'' and inserting the following:
       ``(iii) Authorization of appropriations.--There are 
     authorized to be appropriated to carry out the national 
     program under this section--
       ``(I) $85,000,000 for fiscal year 1998;
       ``(II) $90,000,000 for fiscal year 1999; and
       ``(III) $95,000,000 for fiscal year 2000 and each fiscal 
     year thereafter.''; and
       (4) in paragraph (6)--
       (A) in subparagraph (A), by striking ``and'' at the end;
       (B) in subparagraph (B), by striking the comma at the end 
     and inserting ``; and''; and
       (C) inserting after subparagraph (B) the following:
       ``(C) with outreach, development, and enhancement of 
     minority-owned small business startups or expansions, 
     veteran-owned small business startups or expansions, and 
     women-owned small business startups or expansions, in 
     communities impacted by base closings or military or 
     corporate downsizing, or in rural or underserved 
     communities;''.
       (b) SBDC Services.--Section 21(c) of the Small Business Act 
     (15 U.S.C. 648(c)) is amended--
       (1) in paragraph (3)--
       (A) in subparagraph (A), by striking ``businesses;'' and 
     inserting ``businesses, including--
       ``(i) working with individuals to increase awareness of 
     basic credit practices and credit requirements;
       ``(ii) working with individuals to development business 
     plans, financial packages, credit applications, and contract 
     proposals;
       ``(iii) working with the Administration to develop and 
     provide informational tools for use in working with 
     individuals on pre-business startup planning, existing 
     business expansion, and export planning; and
       ``(iv) working with individuals referred by the local 
     offices of the Administration and Administration 
     participating lenders;'';
       (B) in each of subparagraphs (B), (C), (D), (E), (F), (G), 
     (M), (N), (O), (Q), and (R) by moving each margin two ems to 
     the right;
       (C) in subparagraph (C), by inserting ``and the 
     Administration'' after ``Center'';
       (D) by striking subparagraph (H), and inserting the 
     following:
       ``(H) working with the technical and environmental 
     compliance assistance programs established in each State 
     under section 507 of the Clean Air Act Amendments of 1970, or 
     State pollution prevention programs to notify small 
     businesses through outreach programs of regulations that 
     affect small businesses and making counseling, conferences, 
     and materials available on methods of compliance;'';
       (E) in subparagraph (Q), by striking ``and'' at the end;
       (F) in subparagraph (R), by striking the period at the end 
     and inserting ``; and''; and
       (G) by inserting after subparagraph (R) the following:
       ``(S) providing counseling and technology development when 
     necessary to help small businesses find solutions for 
     complying with environmental, energy, health, safety, and 
     other Federal, State, and local regulation including 
     cooperating with the technical and environmental compliance 
     assistance programs established in each State under section 
     507 of the Clean Air Act Amendments of 1970 or State 
     pollution prevention programs in the provision of counseling 
     and technology development to help small businesses find 
     solutions for complying with environmental regulations.'';
       (2) in paragraph (5)--
       (A) by moving the margin 2 ems to the right;
       (B) by striking ``paragraph (a)(1)'' and inserting 
     ``subsection (a)(1)'';
       (C) by striking ``which ever'' and inserting ``whichever''; 
     and
       (D) by striking ``last,,'' and inserting ``last,'';
       (3) by redesignating paragraphs (4) through (7) as 
     paragraphs (5) through (8), respectively; and
       (4) in paragraph (3), in the undesignated material 
     following subparagraph (S) (as added by this subsection), by 
     striking ``A small'' and inserting the following:
       ``(4) A small''.
       (c) Competitive Awards.--Section 21(l) of the Small 
     Business Act (15 U.S.C. 648(l)) is amended by adding at the 
     end the following: ``If any contract under this section with 
     an entity that is in compliance with this section is not 
     renewed or extended, any award of a contract under this 
     section to another entity shall be made on a competitive 
     basis.''.
       (d) Prohibition on Certain Fees.--Section 21 of the Small 
     Business Act (15 U.S.C. 648) is amended by adding at the end 
     the following:
       ``(m) Prohibition on Certain Fees.--A small business 
     development center shall not impose or otherwise collect a 
     fee or other compensation in connection with the provision of 
     counseling services under this section.''.

     SEC. 503. 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, 1997'' and 
     inserting ``September 30, 2000''.

     SEC. 504. EXTENSION OF COSPONSORSHIP AUTHORITY.

       Section 401(a)(2) of the Small Business Administration 
     Reauthorization and Amendments Act of 1994 (15 U.S.C. 637 
     note) is amended by striking ``September 30, 1997'' and 
     inserting ``September 30, 2000''.

     SEC. 505. ASSET SALES.

       In connection with the Administration's implementation of a 
     program to sell to the private sector loans and other assets 
     held by the Administration, the Administration shall provide 
     to the Committees on Small Business in the Senate and House 
     of Representatives a copy of the draft and final plans 
     describing the sale and the anticipated benefits resulting 
     from such sale.

     SEC. 506. SMALL BUSINESS EXPORT PROMOTION.

       (a) In General.--Section 21(c)(3) of the Small Business Act 
     (15 U.S.C. 648(c)(3)) is amended--
       (1) in subparagraph (Q), by striking ``and'' at the end;
       (2) in subparagraph (B), by striking the period at the end 
     and inserting ``; and''; and
       (3) by inserting after subparagraph (R) the following:
       ``(S) providing small business owners with access to a wide 
     variety of export-related information by establishing on-line 
     computer linkages between small business development centers 
     and an international trade data information network with ties 
     to the Export Assistance Center program.''.
       (b) Authorization of Appropriations.--There are authorized 
     to be appropriated to carry out section 21(c)(3)(S) of the 
     Small Business Act (15 U.S.C. 648(c)(3)(S)), as added by this 
     section, $1,500,000 for each fiscal years 1998 and 1999.

     SEC. 507. DEFENSE LOAN AND TECHNICAL ASSISTANCE PROGRAM.

       (a) DELTA Program Authorized.--
       (1) In general.--The Administrator of the Small Business 
     Administration may administer the Defense Loan and Technical 
     Assistance program in accordance with the authority and 
     requirements of this section.
       (2) Expiration of authority.--The authority of the 
     Administrator to carry out the DELTA program under paragraph 
     (1) shall terminate when the funds referred to in subsection 
     (g)(1) have been expended.
       (3) DELTA program defined.--In this section, the terms 
     ``Defense Loan and Technical Assistance program'' and ``DELTA 
     program'' mean the Defense Loan and Technical Assistance 
     program that has been established by a memorandum of 
     understanding entered into by the Administrator and the 
     Secretary of Defense on June 26, 1995.
       (b) Assistance.--
       (1) Authority.--Under the DELTA program, the Administrator 
     may assist small business concerns that are economically 
     dependent on defense expenditures to acquire dual-use 
     capabilities.
       (2) Forms of assistance.--Forms of assistance authorized 
     under paragraph (1) are as follows:
       (A) Loan guarantees.--Loan guarantees under the terms and 
     conditions specified under this section and other applicable 
     law.
       (B) Nonfinancial assistance.--Other forms of assistance 
     that are not financial.
       (c) Administration of Program.--In the administration of 
     the DELTA program under this section, the Administrator 
     shall--
       (1) process applications for DELTA program loan guarantees;
       (2) guarantee repayment of the resulting loans in 
     accordance with this section; and
       (3) take such other actions as are necessary to administer 
     the program.
       (d) Selection and Eligibility Requirements for DELTA Loan 
     Guarantees.--

[[Page S8987]]

       (1) In general.--The selection criteria and eligibility 
     requirements set forth in this subsection shall be applied in 
     the selection of small business concerns to receive loan 
     guarantees under the DELTA program.
       (2) Selection criteria.--The criteria used for the 
     selection of a small business concern to receive a loan 
     guarantee under this section are as follows:
       (A) The selection criteria established under the memorandum 
     of understanding referred to in subsection (a)(3).
       (B) The extent to which the loans to be guaranteed would 
     support the retention of defense workers whose employment 
     would otherwise be permanently or temporarily terminated as a 
     result of reductions in expenditures by the United States for 
     defense, the termination or cancellation of a defense 
     contract, the failure to proceed with an approved major 
     weapon system, the merger or consolidation of the operations 
     of a defense contractor, or the closure or realignment of a 
     military installation.
       (C) The extent to which the loans to be guaranteed would 
     stimulate job creation and new economic activities in 
     communities most adversely affected by reductions in 
     expenditures by the United States for defense, the 
     termination or cancellation of a defense contract, the 
     failure to proceed with an approved major weapon system, the 
     merger or consolidation of the operations of a defense 
     contractor, or the closure or realignment of a military 
     installation.
       (D) The extent to which the loans to be guaranteed would be 
     used to acquire (or permit the use of other funds to acquire) 
     capital equipment to modernize or expand the facilities of 
     the borrower to enable the borrower to remain in the national 
     technology and industrial base available to the Department of 
     Defense.
       (3) Eligibility requirements.--To be eligible for a loan 
     guarantee under the DELTA program, a borrower must 
     demonstrate to the satisfaction of the Administrator that, 
     during any 1 of the 5 preceding operating years of the 
     borrower, not less than 25 percent of the value of the 
     borrower's sales were derived from--
       (A) contracts with the Department of Defense or the 
     defense-related activities of the Department of Energy; or
       (B) subcontracts in support of defense-related prime 
     contracts.
       (e) Maximum Amount of Loan Principal.--The maximum amount 
     of loan principal for which the Administrator may provide a 
     guarantee under this section during a fiscal year may not 
     exceed $1,250,000.
       (f) Loan Guaranty Rate.--The maximum allowable guarantee 
     percentage for loans guaranteed under this section may not 
     exceed 80 percent.
       (g) Funding.--
       (1) In general.--The funds that have been made available 
     for loan guarantees under the DELTA program and have been 
     transferred from the Department of Defense to the Small 
     Business Administration before the date of the enactment of 
     this Act shall be used for carrying out the DELTA program 
     under this section.
       (2) Continued availability of existing funds.--The funds 
     made available under the second proviso under the heading 
     ``Research, Development, Test and Evaluation, Defense-Wide'' 
     in Public Law 103-335 (108 Stat. 2613) shall be available 
     until expended--
       (A) to cover the costs (as defined in section 502(5) of the 
     Federal Credit Reform Act of 1990 (2 U.S.C. 661a(5))) of loan 
     guarantees issued under this section; and
       (B) to cover the reasonable costs of the administration of 
     the loan guarantees.
                       TITLE VI--HUBZONE PROGRAM

     SEC. 601. SHORT TITLE.

       This title may be cited as the ``HUBZone Act of 1997''.

     SEC. 602. HISTORICALLY UNDERUTILIZED BUSINESS ZONES.

       (a) Definitions.--Section 3 of the Small Business Act (15 
     U.S.C. 632) (as amended by section 412 of this Act) is 
     amended by adding at the end the following:
       ``(p) Definitions Relating to HUBZones.--In this Act:
       ``(1) Historically underutilized business zone.--The term 
     `historically underutilized business zone' means any area 
     located within 1 or more--
       ``(A) qualified census tracts;
       ``(B) qualified nonmetropolitan counties; or
       ``(C) lands within the external boundaries of an Indian 
     reservation.
       ``(2) HUBZone.--The term `HUBZone' means a historically 
     underutilized business zone.
       ``(3) HUBZone small business concern.--The term `HUBZone 
     small business concern' means a small business concern--
       ``(A) that is owned and controlled by 1 or more persons, 
     each of whom is a United States citizen; and
       ``(B) the principal office of which is located in a 
     HUBZone; or
       ``(4) Qualified areas.--
       ``(A) Qualified census tract.--The term `qualified census 
     tract' has the meaning given that term in section 
     42(d)(5)(C)(i)(I) of the Internal Revenue Code of 1986.
       ``(B) Qualified nonmetropolitan county.--The term 
     `qualified nonmetropolitan county' means any county--
       ``(i) that, based on the most recent data available from 
     the Bureau of the Census of the Department of Commerce--

       ``(I) is not located in a metropolitan statistical area (as 
     that term is defined in section 143(k)(2)(B) of the Internal 
     Revenue Code of 1986); and
       ``(II) in which the median household income is less than 80 
     percent of the nonmetropolitan State median household income; 
     or

       ``(ii) that, based on the most recent data available from 
     the Secretary of Labor, has an unemployment rate that is not 
     less than 140 percent of the statewide average unemployment 
     rate for the State in which the county is located.
       ``(5) Qualified hubzone small business concern.--
       ``(A) In general.--A HUBZone small business concern is 
     `qualified', if--
       ``(i) the small business concern has certified in writing 
     to the Administrator (or the Administrator otherwise 
     determines, based on information submitted to the 
     Administrator by the small business concern, or based on 
     certification procedures, which shall be established by the 
     Administration by regulation) that--

       ``(I) it is a HUBZone small business concern;
       ``(II) not less than 35 percent of the employees of the 
     small business concern reside in a HUBZone, and the small 
     business concern will attempt to maintain this employment 
     percentage during the performance of any contract awarded to 
     the small business concern on the basis of a preference 
     provided under section 31(b); and
       ``(III) with respect to any subcontract entered into by the 
     small business concern pursuant to a contract awarded to the 
     small business concern under section 31, the small business 
     concern will ensure that--

       ``(aa) in the case of a contract for services (except 
     construction), not less than 50 percent of the cost of 
     contract performance incurred for personnel will be expended 
     for its employees or for employees of other HUBZone small 
     business concerns; and
       ``(bb) in the case of a contract for procurement of 
     supplies (other than procurement from a regular dealer in 
     such supplies), not less than 50 percent of the cost of 
     manufacturing the supplies (not including the cost of 
     materials) will be incurred in connection with the 
     performance of the contract in a HUBZone by 1 or more HUBZone 
     small business concerns; and
       ``(ii) no certification made or information provided by the 
     small business concern under clause (i) has been, in 
     accordance with the procedures established under section 
     31(c)(1)--

       ``(I) successfully challenged by an interested party; or
       ``(II) otherwise determined by the Administrator to be 
     materially false.

       ``(B) Change in percentages.--The Administrator may utilize 
     a percentage other than the percentage specified in under 
     subclause (IV) or (V) of subparagraph (A)(i), if the 
     Administrator determines that such action is necessary to 
     reflect conventional industry practices among small business 
     concerns that are below the numerical size standard for 
     businesses in that industry category.
       ``(C) Construction and other contracts.--The Administrator 
     shall promulgate final regulations imposing requirements that 
     are similar to those specified in subclauses (IV) and (V) of 
     subparagraph (A)(i) on contracts for general and specialty 
     construction, and on contracts for any other industry 
     category that would not otherwise be subject to those 
     requirements. The percentage applicable to any such 
     requirement shall be determined in accordance with 
     subparagraph (B).
       ``(D) List of qualified small business concerns.--The 
     Administrator shall establish and maintain a list of 
     qualified HUBZone small business concerns, which list shall, 
     to the extent practicable--
       ``(i) include the name, address, and type of business with 
     respect to each such small business concern;
       ``(ii) be updated by the Administrator not less than 
     annually; and
       ``(iii) be provided upon request to any Federal agency or 
     other entity.''.
       (b) Federal Contracting.--
       (1) In general.--The Small Business Act (15 U.S.C. 631 et 
     seq.) is amended--
       (A) by redesignating section 31 as section 32; and
       (B) by inserting after section 30 the following:

     ``SEC. 31. HUBZONE PROGRAM.

       ``(a) In General.--There is established within the 
     Administration a program to be carried out by the 
     Administrator to provide for Federal contracting assistance 
     to qualified HUBZone small business concerns in accordance 
     with this section.
       ``(b) Eligible Contracts.--
       ``(1) Definitions.--In this subsection--
       ``(A) the term `contracting officer' has the meaning given 
     that term in section 27(f)(5) of the Office of Federal 
     Procurement Policy Act (41 U.S.C. 423(f)(5)); and
       ``(B) the terms `executive agency' and `full and open 
     competition' have the meanings given such terms in section 4 
     of the Office of Federal Procurement Policy Act (41 U.S.C. 
     403).
       ``(2) Requirements.--Subject to paragraph (3), a contract 
     opportunity offered for award pursuant to this section shall 
     be awarded on the basis of competition restricted to 
     qualified HUBZone small business concerns, if there is a 
     reasonable expectation that not less than 2 qualified HUBZone 
     small business concerns will submit offers and that award can 
     be made at a fair market price.

[[Page S8988]]

       ``(3) Alternate authority.--Notwithstanding any other 
     provision of law, a contracting officer may award sole source 
     contracts under this section to any qualified HUBZone small 
     business concern, if--
       ``(A) the qualified HUBZone small business concern is 
     determined to be a responsible contractor with respect to 
     performance of such contract opportunity;
       ``(B) the anticipated award price of the contract 
     (including options) will not exceed--
       ``(i) $5,000,000, in the case of a contract opportunity 
     assigned a standard industrial classification code for 
     manufacturing; or
       ``(ii) $3,000,000, in the case of all other contract 
     opportunities; and
       ``(C) in the estimation of the contracting officer, the 
     contract award can be made at a fair and reasonable price.
       ``(4) Price evaluation preference in full and open 
     competitions.--In any case in which a contract is to be 
     awarded on the basis of full and open competition, the price 
     offered by a small business concern shall be deemed as being 
     lower than the price offered by another offeror (other than 
     another small business concern), if the price offered by the 
     qualified HUBZone small business concern is not more than 10 
     percent higher than the price offered by the otherwise 
     lowest, responsive, and responsible offeror.
       ``(5) Relationship to other contracting preferences.--
       ``(A) Subordinate relationship.--A procurement may not be 
     made from a source on the basis of a preference provided in 
     paragraph (2), (3), or (4), if the procurement would 
     otherwise be made from a different source under section 4124 
     or 4125 of title 18, United States Code, or the Javits-
     Wagner-O'Day Act.
       ``(B) Parity relationship.--The provisions of paragraphs 
     (2), (3), and (4) shall not limit the discretion of a 
     contracting officer to let any procurement contract to the 
     Administration under section 8(a). Notwithstanding section 
     8(a), the Administration may not appeal an adverse decision 
     of any contracting officer declining to let a procurement 
     contract to the Administration, if the procurement is made to 
     a qualified HUBZone small business concern on the basis of a 
     preference under paragraph (2), (3), or (4).
       ``(c) Enforcement; Penalties.--
       ``(1) Verification of eligibility.--In carrying out this 
     section, the Administrator shall establish procedures 
     relating to--
       ``(A) the filing, investigation, and disposition by the 
     Administration of any challenge to the eligibility of a small 
     business concern to receive assistance under this section 
     (including a challenge, filed by an interested party, 
     relating to the veracity of a certification made or 
     information provided to the Administration by a small 
     business concern under section 3(p)(5)); and
       ``(B) verification by the Administrator of the accuracy of 
     any certification made or information provided to the 
     Administration by a small business concern under section 
     3(p)(5).
       ``(2) Examinations.--The procedures established under 
     paragraph (1) may provide for program examinations (including 
     random program examinations) by the Administrator of any 
     small business concern making a certification or providing 
     information to the Administrator under section 3(p)(5).
       ``(3) Provision of data.--Upon the request of the 
     Administrator, the Secretary of Labor, the Secretary of 
     Housing and Urban Development, and the Secretary of the 
     Interior (or the Assistant Secretary for Indian Affairs), 
     shall promptly provide to the Administrator such information 
     as the Administrator determines to be necessary to carry out 
     this subsection.
       ``(4) Penalties.--In addition to the penalties described in 
     section 16(d), any small business concern that is determined 
     by the Administrator to have misrepresented the status of 
     that concern as a `HUBZone small business concern' for 
     purposes of this section, shall be subject to--
       ``(A) section 1001 of title 18, United States Code; and
       ``(B) sections 3729 through 3733 of title 31, United States 
     Code.''.
       (2) Initial limited applicability.--During the period 
     beginning on the date of enactment of this Act and ending on 
     September 30, 2000, section 31 of the Small Business Act (as 
     added by paragraph (1) of this subsection) shall apply only 
     to procurements by--
       (A) the Department of Defense;
       (B) the Department of Agriculture;
       (C) the Department of Health and Human Services;
       (D) the Department of Transportation;
       (E) the Department of Energy;
       (F) the Department of Housing and Urban Development;
       (G) the Environmental Protection Agency;
       (H) the National Aeronautics and Space Administration;
       (I) the General Services Administration; and
       (J) the Department of Veterans Affairs.

     SEC. 603. TECHNICAL AND CONFORMING AMENDMENTS TO THE SMALL 
                   BUSINESS ACT.

       (a) Performance of Contracts.--Section 8(d) of the Small 
     Business Act (15 U.S.C. 637(d)) is amended--
       (1) in paragraph (1)--
       (A) in the first sentence, by striking ``,, small business 
     concerns owned and controlled by socially and economically 
     disadvantaged individuals'' and inserting ``, qualified 
     HUBZone small business concerns, small business concerns 
     owned and controlled by socially and economically 
     disadvantaged individuals''; and
       (B) in the second sentence, by inserting ``qualified 
     HUBZone small business concerns,'' after ``small business 
     concerns,'';
       (2) in paragraph (3)--
       (A) by inserting ``qualified HUBZone small business 
     concerns,'' after ``small business concerns,'' each place 
     that term appears; and
       (B) by adding at the end the following:
       ``(F) In this contract, the term `qualified HUBZone small 
     business concern' has the meaning given that term in section 
     3(p) of the Small Business Act.'';
       (3) in paragraph (4)(E), by striking ``small business 
     concerns and'' and inserting ``small business concerns, 
     qualified HUBZone small business concerns, and'';
       (4) in paragraph (6), by inserting ``qualified HUBZone 
     small business concerns,'' after ``small business concerns,'' 
     each place that term appears; and
       (5) in paragraph (10), by inserting ``qualified HUBZone 
     small business concerns,'' after ``small business 
     concerns,''.
       (b) Awards of Contracts.--Section 15 of the Small Business 
     Act (15 U.S.C. 644) is amended--
       (1) in subsection (g)(1)--
       (A) by inserting ``qualified HUBZone small business 
     concerns,'' after ``small business concerns,'' each place 
     that term appears;
       (B) in the second sentence, by striking ``20 percent'' and 
     inserting ``23 percent''; and
       (C) by inserting after the second sentence the following: 
     ``The Governmentwide goal for participation by qualified 
     HUBZone small business concerns shall be established at not 
     less than 1 percent of the total value of all prime contract 
     awards for fiscal year 1999, not less than 1.5 percent of the 
     total value of all prime contract awards for fiscal year 
     2000, not less than 2 percent of the total value of all prime 
     contract awards for fiscal year 2001, not less than 2.5 
     percent of the total value of all prime contract awards for 
     fiscal year 2002, and not less than 3 percent of the total 
     value of all prime contract awards for fiscal year 2003 and 
     each fiscal year thereafter.'';
       (2) in subsection (g)(2)--
       (A) in the first sentence, by striking ``,, by small 
     business concerns owned and controlled by socially and 
     economically disadvantaged individuals'' and inserting ``, by 
     qualified HUBZone small business concerns, by small business 
     concerns owned and controlled by socially and economically 
     disadvantaged individuals'';
       (B) in the second sentence, by inserting ``qualified 
     HUBZone small business concerns,'' after ``small business 
     concerns,''; and
       (C) in the fourth sentence, by striking ``by small business 
     concerns owned and controlled by socially and economically 
     disadvantaged individuals and participation by small business 
     concerns owned and controlled by women'' and inserting ``by 
     qualified HUBZone small business concerns, by small business 
     concerns owned and controlled by socially and economically 
     disadvantaged individuals, and by small business concerns 
     owned and controlled by women''; and
       (3) in subsection (h), by inserting ``qualified HUBZone 
     small business concerns,'' after ``small business concerns,'' 
     each place that term appears.
       (c) Offenses and Penalties.--Section 16 of the Small 
     Business Act (15 U.S.C. 645) is amended--
       (1) in subsection (d)(1)--
       (A) by inserting ``, a `qualified HUBZone small business 
     concern','' after `` `small business concern',''; and
       (B) in subparagraph (A), by striking ``section 9 or 15'' 
     and inserting ``section 9, 15, or 31''; and
       (2) in subsection (e), by inserting ``, a `HUBZone small 
     business concern','' after `` `small business concern',''.

     SEC. 604. OTHER TECHNICAL AND CONFORMING AMENDMENTS.

       (a) Title 10, United States Code.--Section 2323 of title 
     10, United States Code, is amended--
       (1) in subsection (a)(1)(A), by inserting before the 
     semicolon the following: ``, and qualified HUBZone small 
     business concerns (as that term is defined in section 3(p) of 
     the Small Business Act)''; and
       (2) in subsection (f)(1), by inserting ``or as a qualified 
     HUBZone small business concern (as that term is defined in 
     section 3(p) of the Small Business Act)'' after ``(as 
     described in subsection (a))''.
       (b) Federal Home Loan Bank Act.--Section 21A(b)(13) of the 
     Federal Home Loan Bank Act (12 U.S.C. 1441a(b)(13)) is 
     amended--
       (1) by striking ``concerns and small'' and inserting 
     ``concerns, small''; and
       (2) by inserting ``, and qualified HUBZone small business 
     concerns (as that term is defined in section 3(p) of the 
     Small Business Act)'' after ``disadvantaged individuals''.
       (c) Small Business Economic Policy Act of 1980.--Section 
     303(e) of the Small Business Economic Policy Act of 1980 (15 
     U.S.C. 631b(e)) is amended--
       (1) in paragraph (1), by striking ``and'' at the end;
       (2) in paragraph (2), by striking the period at the end and 
     inserting ``; and''; and
       (3) by adding at the end the following:
       ``(3) qualified HUBZone small business concern (as that 
     term is defined in section 3(p) of the Small Business 
     Act).''.
       (d) Small Business Investment Act of 1958.--Section 
     411(c)(3)(B) of the Small Business Investment Act of 1958 (15 
     U.S.C. 694b(c)(3)(B)) is amended by inserting before

[[Page S8989]]

     the semicolon the following: ``, or to a qualified HUBZone 
     small business concern, as that term is defined in section 
     3(p) of the Small Business Act''.
       (e) Title 31, United States Code.--
       (1) Contracts for collection services.--Section 3718(b) of 
     title 31, United States Code, is amended--
       (A) in paragraph (1)(B), by inserting ``and law firms that 
     are qualified HUBZone small business concerns (as that term 
     is defined in section 3(p) of the Small Business Act)'' after 
     ``disadvantaged individuals''; and
       (B) in paragraph (3)--
       (i) in the first sentence, by inserting before the period 
     ``and law firms that are qualified HUBZone small business 
     concerns'';
       (ii) in subparagraph (A), by striking ``and'' at the end;
       (iii) in subparagraph (B), by striking the period at the 
     end and inserting ``; and''; and
       (iv) by adding at the end the following:
       ``(C) the term `qualified HUBZone small business concern' 
     has the meaning given that term in section 3(p) of the Small 
     Business Act.''.
       (2) Payments to local governments.--Section 6701(f) of 
     title 31, United States Code, is amended--
       (A) in paragraph (1)--
       (i) in subparagraph (A), by striking ``and'' at the end;
       (ii) in subparagraph (B), by striking the period at the end 
     and inserting ``; and''; and
       (iii) by adding at the end the following:
       ``(C) qualified HUBZone small business concerns.''; and
       (B) in paragraph (3)--
       (i) in subparagraph (A), by striking ``and'' at the end;
       (ii) in subparagraph (B), by striking the period at the end 
     and inserting ``; and''; and
       (iii) by adding at the end the following:
       ``(C) the term `qualified HUBZone small business concern' 
     has the meaning given that term in section 3(p) of the Small 
     Business Act (15 U.S.C. 632(o)).''.
       (3) Regulations.--Section 7505(c) of title 31, United 
     States Code, is amended by striking ``small business concerns 
     and'' and inserting ``small business concerns, qualified 
     HUBZone small business concerns, and''.
       (f) Office of Federal Procurement Policy Act.--
       (1) Enumeration of included functions.--Section 6(d) of the 
     Office of Federal Procurement Policy Act (41 U.S.C. 405(d)) 
     is amended--
       (A) in paragraph (11), by inserting ``qualified HUBZone 
     small business concerns (as that term is defined in section 
     3(p) of the Small Business Act),'' after ``small 
     businesses,''; and
       (B) in paragraph (12), by inserting ``qualified HUBZone 
     small business concerns (as that term is defined in section 
     3(p) of the Small Business Act (15 U.S.C. 632(o)),'' after 
     ``small businesses,''.
       (2) Procurement data.--Section 502 of the Women's Business 
     Ownership Act of 1988 (41 U.S.C. 417a) is amended--
       (A) in subsection (a)--
       (i) in the first sentence, by inserting ``the number of 
     qualified HUBZone small business concerns,'' after 
     ``Procurement Policy''; and
       (ii) by inserting a comma after ``women''; and
       (B) in subsection (b), by inserting after ``section 204 of 
     this Act'' the following: ``, and the term `qualified HUBZone 
     small business concern' has the meaning given that term in 
     section 3(p) of the Small Business Act (15 U.S.C. 632(o)).''.
       (g) Energy Policy Act of 1992.--Section 3021 of the Energy 
     Policy Act of 1992 (42 U.S.C. 13556) is amended--
       (1) in subsection (a)--
       (A) in paragraph (2), by striking ``or'';
       (B) in paragraph (3), by striking the period and inserting 
     ``; or''; and
       (C) by adding at the end the following:
       ``(4) qualified HUBZone small business concerns.''; and
       (2) in subsection (b), by adding at the end the following:
       ``(3) The term `qualified HUBZone small business concern' 
     has the meaning given that term in section 3(p) of the Small 
     Business Act (15 U.S.C. 632(o)).''.
       (h) Title 49, United States Code.--
       (1) Project grant application approval conditioned on 
     assurances about airport operation.--Section 47107(e) of 
     title 49, United States Code, is amended--
       (A) in paragraph (1), by inserting before the period ``or 
     qualified HUBZone small business concerns (as that term is 
     defined in section 3(p) of the Small Business Act)'';
       (B) in paragraph (4)(B), by inserting before the period 
     ``or as a qualified HUBZone small business concern (as that 
     term is defined in section 3(p) of the Small Business Act)''; 
     and
       (C) in paragraph (6), by inserting ``or a qualified HUBZone 
     small business concern (as that term is defined in section 
     3(p) of the Small Business Act)'' after ``disadvantaged 
     individual''.
       (2) Minority and disadvantaged business participation.--
     Section 47113 of title 49, United States Code, is amended--
       (A) in subsection (a)--
       (i) in paragraph (1), by striking the period at the end and 
     inserting a semicolon;
       (ii) in paragraph (2), by striking the period at the end 
     and inserting ``; and''; and
       (iii) by adding at the end the following:
       ``(3) the term `qualified HUBZone small business concern' 
     has the meaning given that term in section 3(p) of the Small 
     Business Act (15 U.S.C. 632(o)).''; and
       (B) in subsection (b), by inserting before the period ``or 
     qualified HUBZone small business concerns''.

     SEC. 605. REGULATIONS.

       (a) In General.--Not later than 180 days after the date of 
     enactment of this Act, the Administrator of the Small 
     Business Administration shall publish in the Federal Register 
     such final regulations as may be necessary to carry out this 
     title and the amendments made by this title.
       (b) Federal Acquisition Regulation.--Not later than 180 
     days after the date on which final regulations are published 
     under subsection (a), the Federal Acquisition Regulatory 
     Council shall amend the Federal Acquisition Regulation in 
     order to ensure consistency between the Federal Acquisition 
     Regulation, this title and the amendments made by this title, 
     and the final regulations published under subsection (a).

     SEC. 606. REPORT.

       Not later than March 1, 2000, the Administrator of the 
     Small Business Administration shall submit to the Committees 
     on Small Business of the House of Representatives and the 
     Senate a report on the implementation of the HUBZone program 
     established under section 31 of the Small Business Act (as 
     amended by this title) and the degree to which the HUBZone 
     program has resulted in increased employment opportunities 
     and an increased level of investment in HUBZones (as that 
     term is defined in section 3(p) of the Small Business Act, as 
     added by this title).

     SEC. 607. AUTHORIZATION OF APPROPRIATIONS.

       Section 20 of the Small Business Act (15 U.S.C. 631 note) 
     (as amended by section 101 of this Act) is amended--
       (1) in subsection (c), by adding at the end the following:
       ``(3) HUBZone program.--There are authorized to be 
     appropriated to the Administration to carry out the program 
     under section 31, $5,000,000 for fiscal year 1998.'';
       (2) in subsection (d), by adding at the end the following:
       ``(3) HUBZone program.--There are authorized to be 
     appropriated to the Administration to carry out the program 
     under section 31, $5,000,000 for fiscal year 1999.''; and
       (3) in subsection (e), by adding at the end the following:
       ``(3) HUBZone program.--There are authorized to be 
     appropriated to the Administration to carry out the program 
     under section 31, $5,000,000 for fiscal year 2000.''.

  Mr. BOND. I thank the Chair, and I express my gratitude to the 
distinguished Senator from Washington. I suggest the absence of a 
quorum.
  The PRESIDING OFFICER. The clerk will call the roll.
  The assistant legislative clerk proceeded to call the roll.
  Mr. GORTON. Mr. President, I ask unanimous consent that the order for 
the quorum call be rescinded.
  The PRESIDING OFFICER. Without objection, it is so ordered.

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