[Congressional Record Volume 143, Number 132 (Monday, September 29, 1997)]
[House]
[Pages H8070-H8081]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




   SMALL BUSINESS PROGRAMS REAUTHORIZATION AND AMENDMENTS ACT OF 1997

  Mr. TALENT. Mr. Speaker, I move to suspend the rules and pass the 
bill

[[Page H8071]]

(H.R. 2261) to reauthorize and amend the programs of the Small Business 
Act and the Small Business Investment Act, and for other purposes, as 
amended.
  The Clerk read as follows:

                               H.R. 2261

       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 Programs Reauthorization and Amendments Acts of 
     1997''.
       (b) Table of Contents.--

Sec. 1. Short title; table of contents.

                        TITLE I--AUTHORIZATIONS

Sec. 101. Authorizations.

                      TITLE II--FINANCIAL PROGRAMS

                   Subtitle A--General Business Loans

Sec. 201. Securitization regulations.
Sec. 202. Background check of loan applicants.
Sec. 203. Report on increased lender approval, servicing, foreclosure, 
              liquidation, and litigation of 7(a) loans.
Sec. 204. Completion of planning for loan monitoring system.

           Subtitle B--Certified Development Company Program

Sec. 221. Reauthorization of fees.
Sec. 222. PCLP participation
Sec. 223. PCLP eligibility.
Sec. 224. Loss reserves.
Sec. 225. Goals.
Sec. 226. Technical amendments.
Sec. 227. Promulgation of regulations.
Sec. 228. Technical amendment.
Sec. 229. Repeal.
Sec. 230. Loan servicing and liquidation.
Sec. 231. Use of proceeds.
Sec. 232. Lease of property.
Sec. 233. Seller financing.
Sec. 234. Preexisting conditions.

         Subtitle C--Small Business Investment Company Program

Sec. 241. 5-year commitments.
Sec. 242. Program reform.
Sec. 243. Fees.
Sec. 244. Examination fees.

                     Subtitle D--Microloan Program

Sec. 251. Microloan program extension.
Sec. 252. Supplemental microloan grants

                TITLE III--WOMEN'S BUSINESS ENTERPRISES

Sec. 301. Reports.
Sec. 302. Council duties.
Sec. 303. Council membership.
Sec. 304. Authorization of appropriations.
Sec. 305. Women's business centers.
Sec. 306. Office of Women's Business Ownership.

                   TITLE IV--COMPETITIVENESS PROGRAM

Sec. 401. Program term.
Sec. 402. Monitoring agency performance.
Sec. 403. Reports to Congress.
Sec. 404. Small business participation in dredging.
Sec. 405. Technical amendment.

                   TITLE V--MISCELLANEOUS PROVISIONS

Sec. 501. Small business development centers.
Sec. 502. Small business export promotion.
Sec. 503. Pilot preferred surety bond guarantee program extension.
Sec. 504. Very small business concerns.
Sec. 505. Extension of cosponsorship authority.
Sec. 506. Trade assistance program for small business concerns harmed 
              by NAFTA.

                  TITLE VI--SERVICE DISABLED VETERANS

Sec. 601. Purposes.
Sec. 602. Definitions.
Sec. 603. Report by Small Business Administration.
Sec. 604. Information collection.
Sec. 605. State of small business report.
Sec. 606. Loans to veterans.
Sec. 607. Entrepreneurial training, counseling, and management 
              assistance.
Sec. 608. Grants for eligible veterans outreach programs.
Sec. 609. Outreach for eligible veterans.

         TITLE VII--SMALL BUSINESS TECHNOLOGY TRANSFER PROGRAM

Sec. 701. Amendments.
                        TITLE I--AUTHORIZATIONS

     SEC. 101. AUTHORIZATIONS.

       Section 20 of the Small Business Act (15 U.S.C. 631 note) 
     is amended by striking subsections (l) through (q) and 
     inserting the following:
       ``(l) The following program levels are authorized for 
     fiscal year 1998:
       ``(1) For the programs authorized by this Act, the 
     Administration is authorized to make--
       ``(A) $40,000,000 in technical assistance grants, as 
     provided in section 7(m); and
       ``(B) $60,000,000 in loans, as provided in section 7(m).
       ``(2) For the programs authorized by this Act, the 
     Administration is authorized to make $15,040,000,000 in 
     deferred participation loans and other financings. Of such 
     sum, the Administration is authorized to make--
       ``(A) $11,000,000,000 in general business loans as provided 
     in section 7(a);
       ``(B) $3,000,000,000 in financings as provided in section 
     7(a)(13) of this Act and section 504 of the Small Business 
     Investment Act of 1958;
       ``(C) $1,000,000,000 in loans as provided in section 
     7(a)(21); and
       ``(D) $40,000,000 in loans as provided in section 7(m).
       ``(3) For the programs authorized by title III of the Small 
     Business Investment Act of 1958, the Administration is 
     authorized to make--
       ``(A) $600,000,000 in purchases of participating 
     securities; and
       ``(B) $500,000,000 in guarantees of debentures.
       ``(4) For the programs authorized by part B of title IV of 
     the Small Business Investment Act of 1958, the Administration 
     is authorized to enter into guarantees not to exceed 
     $2,000,000,000, of which not more than $650,000,000 may be in 
     bonds approved pursuant to section 411(a)(3) of that Act.
       ``(5) The Administration is authorized to make grants or 
     enter into cooperative agreements--
       ``(A) for the Service Corps of Retired Executives program 
     authorized by section 8(b)(1), $4,000,000; and
       ``(B) for activities of small business development centers 
     pursuant to section 21(c)(3)(G), $15,000,000, to remain 
     available until expended.
       ``(m)(1) 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.
       ``(2) Notwithstanding paragraph (1), for fiscal year 1998--
       ``(A) no funds are authorized to be provided to carry out 
     the loan program authorized by section 7(a)(21) except by 
     transfer from another Federal department or agency to the 
     Administration, unless the program level authorized for 
     general business loans under subsection (l)(2)(A) is fully 
     funded; and
       ``(B) the Administration may not approve loans on behalf of 
     the Administration or on behalf of any other department or 
     agency, by contract or otherwise, under terms and conditions 
     other than those specifically authorized under this Act or 
     the Small Business Investment Act of 1958, except that it may 
     approve loans under section 7(a)(21) of this Act in gross 
     amounts of not more than $1,250,000.
       ``(n) The following program levels are authorized for 
     fiscal year 1999:
       ``(1) For the programs authorized by this Act, the 
     Administration is authorized to make--
       ``(A) $60,000,000 in technical assistance grants as 
     provided in section 7(m); and
       ``(B) $60,000,000 in loans, as provided in section 7(m).
       ``(2) For the programs authorized by this Act, the 
     Administration is authorized to make $16,540,000,000 in 
     deferred participation loans and other financings. Of such 
     sum, the Administration is authorized to make--
       ``(A) $12,000,000,000 in general business loans as provided 
     in section 7(a);
       ``(B) $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;
       ``(C) $1,000,000,000 in loans as provided in section 
     7(a)(21); and
       ``(D) $40,000,000 in loans as provided in section 7(m).
       ``(3) For the programs authorized by title III of the Small 
     Business Investment Act of 1958, the Administration is 
     authorized to make--
       ``(A) $700,000,000 in purchases of participating 
     securities; and
       ``(B) $650,000,000 in guarantees of debentures.
       ``(4) For the programs authorized by part B of title IV of 
     the Small Business Investment Act of 1958, the Administration 
     is authorized to enter into guarantees not to exceed 
     $2,000,000,000, of which not more than $650,000,000 may be in 
     bonds approved pursuant to section 411(a)(3) of that Act.
       ``(5) The Administration is authorized to make grants or 
     enter cooperative agreements--
       ``(A) for the Service Corps of Retired Executives program 
     authorized by section 8(b)(1), $4,500,000; and
       ``(B) 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.
       ``(o)(1) 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.
       ``(2) Notwithstanding paragraph (1), for fiscal year 1999--
       ``(A) no funds are authorized to be provided to carry out 
     the loan program authorized by section 7(a)(21) except by 
     transfer from another Federal department or agency to the 
     Administration, unless the program level authorized for 
     general business loans under subsection (n)(2)(A) is fully 
     funded; and
       ``(B) the Administration may not approve loans on behalf of 
     the Administration or on behalf of any other department or 
     agency, by

[[Page H8072]]

     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.
       ``(p) The following program levels are authorized for 
     fiscal year 2000:
       ``(1) For the programs authorized by this Act, the 
     Administration is authorized to make--
       ``(A) $75,000,000 in technical assistance grants as 
     provided in section 7(m); and
       ``(B) $60,000,000 in direct loans, as provided in section 
     7(m).
       ``(2) For the programs authorized by this Act, the 
     Administration is authorized to make $19,040,000,000 in 
     deferred participation loans and other financings. Of such 
     sum, the Administration is authorized to make--
       ``(A) $13,500,000,000 in general business loans as provided 
     in section 7(a);
       ``(B) $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;
       ``(C) $1,000,000,000 in loans as provided in section 
     7(a)(21); and
       ``(D) $40,000,000 in loans as provided in section 7(m).
       ``(3) For the programs authorized by title III of the Small 
     Business Investment Act of 1958, the Administration is 
     authorized to make--
       ``(A) $850,000,000 in purchases of participating 
     securities; and
       ``(B) $700,000,000 in guarantees of debentures.
       ``(4) For the programs authorized by part B of title IV of 
     the Small Business Investment Act of 1958, the Administration 
     is authorized to enter into guarantees not to exceed 
     $2,000,000,000, of which not more than $650,000,000 may be in 
     bonds approved pursuant to the provisions of section 
     411(a)(3) of that Act.
       ``(5) The Administration is authorized to make grants or 
     enter cooperative agreements--
       ``(A) for the Service Corps of Retired Executives program 
     authorized by section 8(b)(1), $5,000,000; and
       ``(B) for activities of small business development centers 
     pursuant to section 21(c)(3)(G), not to exceed $15,000,000, 
     to remain available until expended.
       ``(q)(1) There are authorized to be appropriated to the 
     Administration for fiscal year 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 provisions of 
     the Small Business Investment Act of 1958, including salaries 
     and expenses of the Administration.
       ``(2) Notwithstanding paragraph (1), for fiscal year 2000--
       ``(A) no funds are authorized to be provided to carry out 
     the loan program authorized by section 7(a)(21) except by 
     transfer from another Federal department or agency to the 
     Administration, unless the program level authorized for 
     general business loans under subsection (p)(2)(A) is fully 
     funded; and
       ``(B) the Administration may not approve loans on behalf of 
     the Administration or on behalf of any other department or 
     agency, by contract or otherwise, under terms and conditions 
     other than those specifically authorized under this Act or 
     the Small Business Investment Act of 1958, except that it may 
     approve loans under section 7(a)(21) of this Act in gross 
     amounts of not more than $1,250,000.''.
                      TITLE II--FINANCIAL PROGRAMS
                   Subtitle A--General Business Loans

     SEC. 201. SECURITIZATION REGULATIONS.

       The Administrator shall promulgate final regulations 
     permitting bank and non-bank lenders to sell or securitize 
     the non-guaranteed portion of loans made under section 7(a) 
     of the Small Business Act (15 U.S.C. 636(a)). Such 
     regulations shall be issued within 90 days of the date of 
     enactment of this Act, and shall allow securitizations to 
     proceed as regularly as is possible within the bounds of 
     prudent and sound financial management practice.

     SEC. 202. BACKGROUND CHECK OF LOAN APPLICANTS.

       Section 7(a)(1) of the Small Business Act (15 U.S.C. 
     636(a)(1)) is amended by striking ``(1)'' and inserting the 
     following:
       ``(1)(A) Credit elsewhere.--'', and by adding the following 
     new paragraph at the end:
       ``(B) Background checks.--Prior to the approval of any loan 
     made pursuant to this subsection, or section 503 of the Small 
     Business Investment Act, the Administrator shall verify the 
     applicant's criminal background, or lack thereof, through the 
     best available means, including, if possible, use of the 
     National Crime Information Center computer system at the 
     Federal Bureau of Investigation.''.

     SEC. 203. REPORT ON INCREASED LENDER APPROVAL, SERVICING, 
                   FORECLOSURE, LIQUIDATION, AND LITIGATION OF 
                   7(A) LOANS.

       (a) Within six months of the date of enactment of this act 
     the Administrator shall report on action taken and planned 
     for future reliance on private sector lender resources to 
     originate, approve, close, service, liquidate, foreclose, and 
     litigate loans made under Section 7(a) of the Small Business 
     Act. The report should address administrative and other steps 
     necessary to achieve these results, including--
       (1) streamlining the process for approving lenders and 
     standardizing requirements;
       (2) establishing uniform reporting requirements using on-
     line automated capabilities to the maximum extent feasible;
       (3) reducing paperwork through automation, simplified forms 
     or incorporation of lender's forms;
       (4) providing uniform standards for approval, closing, 
     servicing, foreclosure, and liquidation;
       (5) promulgating new regulations or amending existing ones;
       (6) establishing a timetable for implementing the plan for 
     reliance on private sector lenders;
       (7) implementing organizational changes at SBA; and
       (8) estimating the annual savings that would occur as a 
     result of implementation.
       (b) In preparing the report the Administrator shall seek 
     the views and consult with, among others, 7(a) borrowers and 
     lenders, small businesses who are potential program 
     participants, financial institutions who are potential 
     program lenders, and representative industry associations, 
     such as the U. S. Chamber of Commerce, the American Bankers 
     Association, the National Association of Government 
     Guaranteed Lenders and the Independent Bankers Association of 
     America.

     SEC. 204. COMPLETION OF PLANNING FOR LOAN MONITORING SYSTEM.

       (a) The Administrator shall perform and complete the 
     planning needed to serve as the basis for funding the 
     development and implementation of computerized loan 
     monitoring system, including--
       (1) fully defining the system requirement using on-line, 
     automated capabilities to the extent feasible;
       (2) identifying all data inputs and outputs necessary for 
     timely report generation;
       (3) benchmark loan monitoring business processes and 
     systems against comparable industry processes and, if 
     appropriate, simplify or redefine work processes based on 
     these benchmarks;
       (4) determine data quality standards and control systems 
     for ensuring information accuracy;
       (5) identify an acquisition strategy and work increments to 
     completion;
       (6) analyze the benefits and costs of alternatives and use 
     to demonstrate the advantage of the final project;
       (7) ensure that the proposed information system is 
     consistent with the agency's information architecture; and
       (8) estimate the cost to system completion, identifying the 
     essential cost element.
       (b) Six months from the date of enactment of this Act, the 
     Administrator shall report to the House and Senate Committees 
     on Small Business pursuant to the requirements of subsection 
     (a), and shall also submit a copy of the report to the 
     General Accounting Office, which shall evaluate the report 
     for compliance with subsection (a) and shall submit such 
     evaluation to both Committees no later than 28 days after 
     receipt of the report from the Small Business Administration. 
     None of the funds provided for the purchase of the loan 
     monitoring system may be expended until the requirements of 
     this section have been satisfied.
           Subtitle B--Certified Development Company Program

     SEC. 221. REAUTHORIZATION OF FEES.

       Section 503 of the Small Business Investment Act of 1958 
     (15 U.S.C. 697) is amended--
       (1) by striking subsection (b)(7)(A) and inserting the 
     following:
       ``(A) assesses and collects a fee, which shall be payable 
     by the borrower, in an amount equal to 0.9375 percent per 
     year of the outstanding balance of the loan; and'';
       (2) by striking from subsection (d)(2) ``equal to 50 basis 
     points'' and inserting ``equal to not more than 50 basis 
     points,'';
       (3) by adding the following at the end of subsection 
     (d)(2): ``The amount of the fee authorized herein shall be 
     established annually by the Administration in the minimal 
     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
       (4) by striking from subsection (f) ``1997'' and inserting 
     ``2000''.

     SEC. 222. PCLP PARTICIPATION.

       Section 508(a) of the Small Business Investment Act of 1958 
     (15 U.S.C. 697e(a)) is amended by striking ``not more than 
     15''.

     SEC. 223. PCLP ELIGIBILITY.

       Section 508(b)(2) of the Small Business Investment Act of 
     1958 (15 U.S.C. 697e(b)(2)) is amended by striking paragraphs 
     (A) and (B) and inserting:
       ``(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 (i) of submitting to the Administration 
     adequately analyzed debenture guarantee application packages 
     and (ii) of properly closing section 504 loans and servicing 
     its loan portfolio; and''.

     SEC. 224. LOSS RESERVES.

       Section 508(c) of the Small Business Investment Act of 1958 
     (15 U.S.C. 697e(c)) is amended to read as follows:

[[Page H8073]]

       ``(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 
     equal to 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.''.

     SEC. 225. GOALS.

       Section 508 of the Small Business Investment Act of 1958 
     (15 U.S.C. 697e) is amended by inserting the following after 
     subsection (d) and by redesignating subsections (e) to (i) as 
     (f) to (j):
       ``(e) Program Goals.--Certified development companies 
     participating in this program shall establish a goal of 
     processing 50 percent of their loan applications for section 
     504 assistance pursuant to the premier certified lender 
     program authorized in this section.''.

     SEC. 226. TECHNICAL AMENDMENTS.

       Section 508(g) of the Small Business Investment Act of 1958 
     (15 U.S.C. 697(g)) is amended--
       (1) in subsection (g), as redesignated herein, is amended 
     by striking ``State or local'' and inserting ``certified'';
       (2) in subsection (h), as redesignated herein--
       (A) by striking ``EFFECT OF SUSPENSION OR DESIGNATION'' and 
     inserting ``EFFECT OF SUSPENSION OR REVOCATION''; and
       (B) by striking ``under subsection (f)'' and inserting 
     ``under subsection (g)''.

     SEC. 227. PROMULGATION OF REGULATIONS.

       Section 508(i) of the Small Business Investment Act of 1958 
     (15 U.S.C. 697e(i)), as redesignated herein, is amended to 
     read as follows:
       ``(i) Regulations.--Not later than 90 days after the date 
     of enactment of this section, the Administration shall 
     promulgate regulations to carry out this section. Not later 
     than 120 days after the date of enactment, the Administration 
     shall issue program guidelines and implement the changes made 
     herein.''.

     SEC. 228. TECHNICAL AMENDMENT.

       Section 508(j) of the Small Business Investment Act of 1958 
     (15 U.S.C. 697e(j)), as redesignated herein, is amended by 
     striking ``other lenders'' and inserting ``other lenders, 
     specifically comparing default rates and recovery rates on 
     liquidations''.

     SEC. 229. REPEAL.

       Section 217(b) of Public Law 103-403 (108 Stat. 4185) is 
     repealed.

     SEC. 230. LOAN SERVICING AND LIQUIDATION.

       Section 508(d)(1) of the Small Business Investment Act of 
     1958 (15 U.S.C. 697e(d)) is amended by striking ``to approve 
     loans'' and inserting ``to approve, authorize, close, 
     service, foreclose, litigate, and liquidate loans''.

     SEC. 231. USE OF PROCEEDS.

       Section 502(1) of the Small Business Investment Act of 1958 
     (15 U.S.C. 696(1)) is amended to read as follows:
       ``(1) The proceeds of any such loan shall be used solely by 
     such borrower or borrowers to assist an identifiable small-
     business or businesses and for a sound business purpose 
     approved by the Administration.''.

     SEC. 232. LEASE OF PROPERTY.

       Section 502 of the Small Business Investment Act of 1958 
     (15 U.S.C. 696) is amended by adding the following new 
     subsection:
       ``(5) Not to exceed 25 percent of any project may be 
     permanently leased by the assisted small business: Provided,  
     That the assisted small business shall be required to occupy 
     and use not less than 55 percent of the space in the project 
     after the execution of any leases authorized in this 
     section.''.

     SEC. 233. SELLER FINANCING AND COLLATERALIZATION.

       Section 502(3) of the Small Business Investment Act of 1958 
     (15 U.S.C. 696(3)) is amended by inserting the following new 
     subparagraphs:
       ``(D) Seller financing.--Seller provided financing may be 
     used to meet the requirements of--
       ``(i) paragraph (B), if the seller subordinates his 
     interest in the property to the debenture guaranteed by the 
     Administration; and
       ``(ii) not to exceed 50 percent of the amounts required by 
     paragraph (C).
       ``(E) Collateralization.--The collateral provided by the 
     small business concern generally shall include a subordinate 
     lien position on the property being financed under this 
     title, and is only one of the factors to be evaluated in the 
     credit determination. Additional collateral shall be required 
     only if the Administration determines, on a case by case 
     basis, that additional security is necessary to protect the 
     interest of the Government.''.

     SEC. 234. PREEXISTING CONDITIONS.

       Section 502 of the Small Business Investment Act of 1958 
     (15 U.S.C. 696) is amended by adding the following new 
     paragraph:
       ``(6) Any loan authorized under this section shall not be 
     denied or delayed for approval by the Administration due to 
     concerns over preexisting environmental conditions: Provided, 
     That the development company provides the Administration a 
     letter issued by the appropriate State or Federal 
     environmental protection agency specifically stating that the 
     environmental agency will not institute any legal proceedings 
     against the borrower or, in the event of a default, the 
     development company or the Administration based on the 
     preexisting environmental conditions: Provided further, That 
     the borrower shall agree to provide environmental agencies 
     access to the property for any reasonable and necessary 
     remediation efforts or inspections.''.
         Subtitle C--Small Business Investment Company Program

     SEC. 241. 5-YEAR COMMITMENTS.

       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 one or more of 
     the 4 subsequent fiscal years''.

     SEC. 242. PROGRAM REFORM.

       (a) Tax Distributions.--Section 303(g)(8) of the Small 
     Business Investment Act of 1958 (15 U.S.C. 683(g)(8)) is 
     amended in the first sentence--
       (1) by inserting ``, for each calendar quarter or once 
     annually, as the company may elect,'' after ``the company 
     may''; and
       (2) by inserting ``for the preceding quarter or year'' 
     before the period.
       (b) 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 in which 
     case in which no commitment has been entered into by the 
     Administration) on the date on which the leverage is drawn 
     by the licensee''.
       (c) 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''.
       (d) 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--

[[Page H8074]]

       ``(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.''.

     SEC. 243. FEES.

       Section 301 of the Small Business Investment Act of 1958 
     (15 U.S.C. 681) is amended by adding the following:
       ``(d) 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. 244. 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 are authorized to be 
     appropriated solely to cover the costs of examinations and 
     other program oversight activities.''.
                     Subtitle D--Microloan Program

     SEC. 251. MICROLOAN PROGRAM EXTENSION.

       (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''.

     SEC. 252. SUPPLEMENTAL MICROLOAN GRANTS.

       Section 7(m)(4) of the Small Business Act (15 USC 636 
     (m)(4)) is amended by adding the following:
       ``(F)(i) The Administration may accept and disburse funds 
     received from another Federal department or agency to provide 
     additional assistance to individuals who are receiving 
     assistance under the State program funded under part A of 
     title IV of the Social Security Act (42 USC 601 et seq.), or 
     under any comparable State-funded means-tested program of 
     assistance for low-income individuals.
       ``(ii) Grant proceeds are in addition to other grants 
     provided by this subsection and shall not require the 
     contribution of matching amounts to be eligible. The grants 
     may be used to pay or reimburse a portion of child care and 
     transportation costs of individuals described in clause (i) 
     and for marketing, management and technical assistance.
       ``(iii) Prior to accepting and distributing any such 
     grants, the Administration shall enter a Memorandum of 
     Understanding with the department or agency specifying the 
     terms and conditions of the grants and providing appropriate 
     monitoring of expenditures by the intermediary and ultimate 
     grant recipient to insure compliance with the purpose of the 
     grant.
       ``(iv) 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 any monies distributed pursuant to the provisions 
     of this paragraph.
       ``(v) No funds are authorized to be provided to carry out 
     the grant program authorized by this paragraph (F) except by 
     transfer from another Federal department or agency to the 
     Administration.''.
                TITLE III--WOMEN'S BUSINESS ENTERPRISES

     SEC. 301. 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. 302. 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 ``; and''; 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. 303. 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 
     ``4'';
       (E) in paragraph (2)--
       (i) by striking ``2'' and inserting ``4''; and
       (ii) by striking ``and'' at the end;
       (F) in paragraph (3)--
       (i) by striking ``5'' and inserting ``6''; and
       (ii) by striking ``national''.

     SEC. 304. 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 ``$600,000, of 
     which $200,000 shall be for grants for research of women's 
     procurement or finance issues.''.

     SEC. 305. 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) Definition.--For the purposes of this section the 
     term `small business concern owned and controlled by women', 
     either startup or existing, includes any small business 
     concern--
       ``(1) that is not less than 51 percent owned by one or more 
     women; and
       ``(2) the management and daily business operations of which 
     are controlled by one or more women.
       ``(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

[[Page H8075]]

     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 and second years, 1 non-Federal dollar 
     for each 2 Federal dollars.
       ``(B) In the third year, 1 non-Federal dollar for each 
     Federal dollar.
       ``(C) In the fourth and fifth years, 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.
       ``(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 of which for 
     fiscal year 1998 not more than 10 percent may be used for 
     administrative expenses related to the program. Amounts 
     appropriated pursuant to this subsection for fiscal year 1999 
     and later 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 small business 
     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. 306. 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:
       ``(j) Assistant Administrator for the Office of Women's 
     Business Ownership.--
       ``(1) Establishment.--There is established the position of 
     Assistant Administrator for the Office of Women's Business 
     Ownership (hereafter in this section referred to as the 
     `Assistant Administrator') who shall serve without regard to 
     the provisions of title 5, United States Code, governing 
     appointments in the competitive service.
       ``(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;
       ``(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) serving as the vice chairperson of the Interagency 
     Committee on Women's Business Enterprise;
       ``(ix) serving as liaison for the National Women's Business 
     Council; and
       ``(x) 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.
       ``(k) 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).
       ``(l) 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.''.
                   TITLE IV--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 ``, and terminate on September 30, 
     1997''.

     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. SMALL BUSINESS PARTICIPATION IN DREDGING.

       Section 722(a) of the Small Business Competitiveness 
     Demonstration Program Act of

[[Page H8076]]

     1988 (15 U.S.C. 644 note) is amended by striking ``and 
     terminating on September 30, 1997''.

     SEC. 404. TECHNICAL AMENDMENT.

       Section 717 of the Small Business Competitiveness 
     Demonstration Program Act of 1988 (15 U.S.C. 644 note) is 
     amended--
       (1) by striking ``standard industrial classification code'' 
     each time it appears and inserting in lieu thereof ``North 
     American Industrial Classification Code''; and
       (2) by striking ``standard industrial classification 
     codes'' each time it appears and inserting in lieu thereof 
     ``North American Industrial Classification Codes''.
                   TITLE V--MISCELLANEOUS PROVISIONS

     SEC. 501. 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), by inserting ``any women's business 
     center operating pursuant to section 29,'' after ``credit or 
     finance corporation,'';
       (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) Maximum amount.--Except as provided in clause (ii), 
     and subject to subclause (II) of this clause, the amount of a 
     grant received by a State under this section shall not exceed 
     greater of--

       ``(aa) $500,000; and
       ``(bb) the State's pro rata share of a national program, 
     based upon the population of the State as compared to the 
     total population of the United States.

       ``(II) Exception.--Subject to the availability of amounts 
     made available in advance in an appropriations Act to carry 
     out this section for any fiscal year in excess of amounts so 
     provided for fiscal year 1997, the amount of a grant received 
     by a State under this section shall not exceed the greater of 
     $500,000, and the sum of--

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

       (B) in clause (iii), by striking ``(iii)'' and all that 
     follows through ``1997.'' and inserting the following:
       ``(iii) National program.--The national program under this 
     section shall be--
       ``(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 the Administration to develop and 
     provide informational tools for use in working with 
     individuals on pre-business startup planning, existing 
     business expansion, business plans, financial packages, 
     credit applications, contract proposals, and export planning; 
     and
       ``(iii) 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 left;
       (C) in subparagraph (C), by inserting ``and the 
     Administration'' after ``Center'';
       (D) in subparagraph (Q), by striking ``and'' at the end;
       (E) in subparagraph (R), by striking the period at the end 
     and inserting ``; and''; and
       (2) in paragraph (5)--
       (A) by moving the margin 2 ems to the left;
       (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 is 
     not renewed or extended, award of the succeeding contract 
     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. 502. 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 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 of fiscal years 1998 and 1999.

     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. VERY SMALL BUSINESS CONCERNS.

       Section 304(i) of Public Law 103-403 (15 U.S.C. 644 note) 
     is amended by striking ``1998'' and inserting ``2000''.

     SEC. 505. 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. 506. TRADE ASSISTANCE PROGRAM FOR SMALL BUSINESS 
                   CONCERNS HARMED BY NAFTA.

       The Small Business Administration shall coordinate 
     assistance programs currently administered by the 
     Administration to counsel small business concerns harmed by 
     the North American Free Trade Agreement to aid such concerns 
     in reorienting their business purpose.
                  TITLE VI--SERVICE DISABLED VETERANS

     SEC. 601. PURPOSES.

       The purposes of this title are--
       (1) to foster enhanced entrepreneurship among eligible 
     veterans by providing increased opportunities;
       (2) to vigorously promote the legitimate interests of small 
     business concerns owned and controlled by eligible veterans; 
     and
       (3) to ensure that those concerns receive fair 
     consideration in purchases made by the Federal Government.

     SEC. 602. DEFINITIONS.

       For purposes of this title, the following definitions 
     apply:
       (1) Administration.--The term ``Administration'' means the 
     Small Business Administration.
       (2) Administrator.--The term ``Administrator'' means the 
     Administrator of the Small Business Administration.
       (3) Eligible veteran.--The term ``eligible veteran'' means 
     a disabled veteran, as defined in section 4211(3) of title 
     38, United States Code.
       (4) Small business concern owned and controlled by eligible 
     veterans.--The term ``small business concern owned and 
     controlled by eligible veterans'' means a small business 
     concern (as defined in section 3 of the Small Business Act)--
       (A) which is at least 51 percent owned by 1 or more 
     eligible veteran, or in the case of a publicly owned 
     business, at least 51 percent of the stock of which is owned 
     by 1 or more eligible veteran; and
       (B) whose management and daily business operations are 
     controlled by eligible veterans.

     SEC. 603. REPORT BY SMALL BUSINESS ADMINISTRATION.

       (a) Study and Report.--Not later than 6 months after the 
     date of the enactment of this Act, the Administrator shall 
     conduct a comprehensive study and issue a final report to the 
     Committees on Small Business of the House of Representatives 
     and the Senate containing findings and recommendations of the 
     Administrator on--
       (1) the needs of small business concerns owned and 
     controlled by eligible veterans;
       (2) the availability and utilization of Administration 
     programs by small business concerns owned and controlled by 
     eligible veterans;
       (3) the percentage, and dollar value, of Federal contracts 
     awarded to small business concerns owned and controlled by 
     eligible veterans in the preceding 5 fiscal years; and

[[Page H8077]]

       (4) methods to improve Administration and other programs to 
     serve the needs of small business concerns owned and 
     controlled by eligible veterans.

     The report also shall include recommendations to Congress 
     concerning the need for legislation and recommendations to 
     the Office of Management and Budget, relevant offices within 
     the Administration, and the Department of Veterans Affairs.
       (b) Conduct of Study.--In carrying out subsection (a), the 
     Administrator--
       (1) may conduct surveys of small business concerns owned 
     and controlled by eligible veterans and service disabled 
     veterans, including those who have sought financial 
     assistance or other services from the Administration;
       (2) shall consult with the appropriate committees of 
     Congress, relevant groups and organizations in the non-profit 
     sector, and Federal or State government agencies; and
       (3) shall have access to any information within other 
     Federal agencies which pertains to such veterans and their 
     small businesses, unless such access is specifically 
     prohibited by law.

     SEC. 604. INFORMATION COLLECTION.

       After the date of issuance of the report required by 
     section 603, the Secretary of Veterans Affairs shall, in 
     consultation with the Assistant Secretary for Veterans' 
     Employment and Training and the Administrator, engage in 
     efforts each fiscal year to identify small business concerns 
     owned and controlled by eligible veterans in the United 
     States. The Secretary shall inform each small business 
     concern identified under this section that information on 
     Federal procurement is available from the Administrator.

     SEC. 605. STATE OF SMALL BUSINESS REPORT.

       Section 303(b) of the Small Business Economic Policy Act of 
     1980 (15 U.S.C. 631b(b)) is amended by striking ``and female-
     owned businesses'' and inserting ``, female-owned, and 
     veteran-owned businesses''.

     SEC. 606. LOANS TO VETERANS.

       Section 7(a) of the Small Business Act (15 U.S.C. 636(a)) 
     is amended by inserting after paragraph (7) the following:
       ``(8) The Administration is empowered to make loans under 
     this subsection to small business concerns owned and 
     controlled by disabled veterans. For purposes of this 
     paragraph, the term `disabled veteran' shall have the meaning 
     such term has in section 4211(3) of title 38, United States 
     Code.''.

     SEC. 607. ENTREPRENEURIAL TRAINING, COUNSELING, AND 
                   MANAGEMENT ASSISTANCE.

       The Administrator shall take such actions as may be 
     necessary to ensure that small business concerns owned and 
     controlled by eligible veterans have access to programs 
     established under the Small Business Act which provide 
     entrepreneurial training, business development assistance, 
     counseling, and management assistance to small business 
     concerns. Such programs include the Small Business 
     Development Center, Small Business Institute, Service Corps 
     of Retired Executives (SCORE), and Active Corps of Executives 
     (ACE) programs.

     SEC. 608. GRANTS FOR ELIGIBLE VETERANS OUTREACH PROGRAMS.

       Section 8(b) of the Small Business Act (15 U.S.C. 637(b)) 
     is amended--
       (1) by striking ``and'' at the end of paragraph (15);
       (2) by striking the period at the end of the first 
     paragraph (16) and inserting ``; and'';
       (3) by striking the second paragraph (16); and
       (4) by adding at the end the following new paragraph:
       ``(17) to make grants to, and enter into contracts and 
     cooperative agreements with, educational institutions, 
     private businesses, veterans' nonprofit community-based 
     organizations, and Federal, State, and local departments and 
     agencies for the establishment and implementation of outreach 
     programs for disabled veterans, as defined in section 4211(3) 
     of title 38, United States Code.''.

     SEC. 609. OUTREACH FOR ELIGIBLE VETERANS.

       The Administrator, the Secretary of Veterans Affairs, and 
     the Assistant Secretary of Labor for Veterans' Employment and 
     Training shall develop and implement a program of 
     comprehensive outreach to assist eligible veterans. Such 
     outreach shall include business training and management 
     assistance, employment and relocation counseling, and 
     dissemination of information on veterans benefits and 
     veterans entitlements.
         TITLE VII--SMALL BUSINESS TECHNOLOGY TRANSFER PROGRAM.

     SEC. 701. AMENDMENTS.

       Section 9 of the Small Business Act (15 U.S.C. 638) is 
     amended--
       (1) in subsection (b)(7), by inserting ``, and the 
     Committee on Science'' after ``of the Senate'';
       (2) in subsection (e)(4)(A) by striking ``(ii)'';
       (3) in subsection (e)(6)(B), by inserting ``agency'' after 
     ``to meet particular'';
       (4) in subsection (n)(1)(C), by striking ``and 1997'' and 
     inserting in lieu thereof ``through 2000'';
       (5) in subsection (o)--
       (A) by redesignating paragraphs (8) through (11) as 
     paragraphs (10) through (13), respectively; and
       (B) by inserting after paragraph (7) the following new 
     paragraphs:
       ``(8) include, as part of its annual performance plan as 
     required by section 1115(a) and (b) of title 31, United 
     States Code, a section on its STTR program, and shall submit 
     such section to the Committee on Small Business of the 
     Senate, and the Committee on Science and the Committee on 
     Small Business of the House of Representatives;
       ``(9) collect such data from awardees as is necessary to 
     assess STTR program outputs and outcomes;''; and
       (6) by adding at the end the following new subsections:
       ``(s) Outreach Program.--Within 90 days after the date of 
     the enactment of this subsection, the Administrator shall 
     develop and begin implementation of an outreach program to 
     encourage increased participation in the STTR program of 
     small business concerns, universities, and other research 
     institutions located in States in which the total number of 
     STTR awards for the previous 2 fiscal years is less than 20.
       ``(t) Inclusion in Strategic Plans.--Program information 
     relating to the SBIR and STTR programs shall be included by 
     Federal agencies in any updates and revisions required under 
     section 306(b) of title 5, United States Code.''.

  The SPEAKER pro tempore. Pursuant to the rule, the gentleman from 
Missouri [Mr. Talent] and the gentleman from New York [Mr. LaFalce] 
each will control 20 minutes.
  The Chair recognizes the gentleman from Missouri [Mr. Talent].
  Mr. TALENT. Mr. Speaker, I yield myself such time as I may consume.
  The primary purpose of H.R. 2261 is to reauthorize the Small Business 
Administration and the programs which that agency manages by authority 
granted under the Small Business Act and the Small Business Investment 
Act through fiscal year 2000.
  The committee regularly authorizes these programs for a 3-year 
period, with the last reauthorization occurring in 1994 during the 103d 
Congress. Programs include the financial programs of the SBA: the 7(a) 
general business loan guarantee, Section 504 Certified Development 
Company program, and other programs.
  The programs of the SBA, Mr. Speaker, annually provide assistance to 
over 100,000 small businesses all across the United States. These 
financial programs remedy shortfalls in access to credit and capital 
for small businesses that are in need because of unfortunate 
imperfections in the national economy.
  By assuring financial assistance for amounts as small as $500 to as 
much as $1,250,000, the SBA and its private sector partners, bank and 
non-bank lenders, surety bond insurers, et cetera, provide a vital 
impetus to the small business sector. The SBA also provides hundreds of 
millions of dollars in vital disaster assistance to small businesses 
and homeowners every year.
  H.R. 2261 reflects the committee's dedication to and support for 
these programs and the belief that they are not only necessary but also 
constantly in need of refinement and improvement as the economy shifts 
and changes. The bill includes not only the basic reauthorization 
language necessary to continue regular operations but also changes to 
the underlying program structures.
  The bill includes significant improvements in the Preferred Certified 
Lender Program of the Section 504 Certified Development Company 
Program. These changes serve to help implement the committee's goals of 
increased reliance on private sector lending partners. The committee 
seeks to both enable the CDC's to take additional responsibility for 
servicing, liquidation and litigation of defaulted loans, and to 
improve the recoveries for this program.
  H.R. 2261 also continues the committee's work on improving the Small 
Business Investment Company Program. Last year this program underwent 
significant changes, and this year the committee seeks to build on 
those improvements by providing SBIC's with increased flexibility and 
some responsiveness in order to better allow the SBIC's to interact in 
the marketplace and thereby reduce risks of loss.
  The measure before us has two additional components that were added 
to this legislation since our committee reported it. These additional 
elements have been added as a result of bipartisan efforts and, in 
fact, have involved the collective work of multiple committees. Title 
VI of H.R. 2261, as amended, contains a number of provisions which are 
designed to assist the Federal Government in better serving service 
disabled veterans and small businesses owned by service disabled 
veterans. These measures are the product of bipartisan efforts by 
myself and

[[Page H8078]]

the gentleman from New York [Mr. LaFalce], the committee's ranking 
member, working together with the chairman of the Committee on Rules 
and the chairman of the Committee on Veterans' Affairs.
  Title VII of this legislation is also the product of a bipartisan and 
multicommittee effort between the Committee on Small Business and the 
Committee on Science. Title VII contains H.R. 2429, as reported by the 
Committee on Science, which is a 3-year reauthorization of the Pilot 
Small Business Technology Transfer Program. Building upon the 
established model of the Small Business Innovation Research Program, 
the STTR program provides the statutory basis for structured 
collaborations between small technology entrepreneurs and nonprofit 
research institutions, such as universities or federally funded 
Research and Development Centers, to foster commercialization of the 
results of federally sponsored research.
  Mr. Speaker, I urge my colleagues to support small business, the 
engine of our economy, by voting for this needed legislation.
  Mr. Speaker I reserve the balance of my time.
  Mr. LaFALCE. Mr. Speaker, I yield myself such time as I may consume.
  (Mr. LaFalce asked and was given permission to revise and extend his 
remarks.)
  Mr. LaFALCE. Mr. Speaker, I rise in strong support of H.R. 2261. I 
concur fully in the remarks of the gentleman from Missouri [Mr. 
Talent], the distinguished chairman of the Committee on Small Business.
  Mr. Speaker, I do not think it is necessary to reiterate the contents 
of this bill. Suffice it to say it is an important bill. The bill is a 
product of tremendous cooperation between the gentleman from Missouri 
[Mr. Talent] and myself, between his staff and my staff, and amongst 
the various committees that were involved, too, the Committee on Rules, 
the Subcommittee on Technology, et cetera.
  The gentleman from Missouri [Mr. Talent] has shown excellence as 
chairman of the Committee on Small Business. He will do nothing but 
grow in that position and become even more excellent, but I hope he 
will yield that position unwillingly at the end of 1998.
  Mr. Speaker, I rise in strong support of H.R. 2261. The bill, which 
was marked up by the Small Business Committee in late July, received 
broad bipartisan support and was unanimously adopted by the Small 
Business Committee. It reauthorizes and makes improvements to a number 
of excellent SBA programs that have always had, and today do have broad 
bipartisan support in this House.
  The small business community has long been a key source of economic 
activity and a spur to job creation. But access to capital has been a 
recurrent problem. The programs of the SBA annually provide over $13 
billion of financial assistance to over 100,000 small businesses, 
remedying shortfalls in access to credit and capital for small 
business.
  By providing financial assistance for amounts as small as $500 to as 
much as $1,250,000, the SBA and its private sector partners--bank and 
non-bank lenders, surety bond insurers, certified development 
companies, microlenders, and small business investment companies--play 
a vital role for small businesses in this economy. The SBA is 
particularly successful because it relies mostly on private capital to 
provide financing to small businesses. In addition, the SBA has become 
more responsive to the needs of small businesses by creating loan 
programs geared to their special needs, including the LowDoc Program 
with reduced paperwork for smaller borrowers, the Export Working 
Capital Program for small business exporters, and the Microloan 
Program. Also, the SBA also provides millions of dollars in vital 
disaster assistance to small businesses and homeowners every year.
  In addition, the SBA also provides counseling to small business 
owners. In fiscal year 1997, the agency has provided counseling and 
training to over 1 million of its small business clients through 
resource partners such as the Service Corps of Retired Executives 
[SCORE] and Small Business Development Centers [SBDC's].
  These billions of dollars in assistance are provided at a total cost 
of $850 million for programs and salaries and expenses.
  The bill reauthorizes the Small Business Administration's programs 
for 3 years, fiscal year 1998 through fiscal year 2000, and also makes 
significant improvements to them. The programs include the section 7(a) 
general business loan guarantee, the section 504 Certified Development 
Company [CDC], the Microloan, the Small Business Investment Company 
[SBIC], SBDC, and SCORE Programs. I would like to describe some of the 
bill's more important provisions.
  Title I of the bill sets forth the authorization levels for the 
various SBA programs. For example, in fiscal year 1998, funding is 
provided to allow for $10 billion in guaranteed loans, with an increase 
to $11 billion in fiscal year 1999, and $13 billion in fiscal year 
2000. Likewise the section 504 [CDC] program is authorized at $3 
billion in fiscal year 1998, an increase of 340 million over current 
year levels, $3.5 billion in fiscal year 1991, and $4.5 billion in the 
year 2000. The bill authorizes increases in the Micro-loan Program, 
from increased technical assistance to more funds for guaranteed and 
direct loans.
  Title II improves various financial assistance programs to make them 
more sound, by increasing funding from the private sector and 
effectively liquidating those loans which do fail.
  In particular, title II makes significant improvements in the section 
504 [CDC] program. It expands the program to qualify more Certified 
Development Companies [CDC's]; establishes loan loss reserves to 
preferred lender participants; authorizes participating CDC's to 
foreclose on, liquidate, and litigate on defaulted loans, which should 
free up SBA resources and substantially improve recovery rates for 
those loans which do fail; allows sellers of property to provide 
financing of up to 50 percent, as long as the seller is subordinate to 
the SBA's interest in the property; and prevents SBA from delaying loan 
approval due to environmental concerns, if a prospective borrower 
obtains a letter of nonliability from the EPA or a State environmental 
agency concerning any hazardous conditions and otherwise cooperates in 
remediation efforts.
  Title II also makes several minor changes and reforms to the SBIC 
program. The bill would provide SBICs with greater flexibility and 
better access to financial markets and would improve the operations of 
SBA's investment division.

  Finally, title II permanently authorizes the Microloan Program, 
changing it from a demonstration program, and extends the guaranteed 
Microloan Program by 3 years. This program provides loans of amounts 
below $25,000 and is designed to provide technical assistance, business 
counseling grants, and financial assistance to very small businesses, 
in particular startups and home-based businesses. The Microloan Program 
has made over 5,000 loans totaling over $60 million to small businesses 
since 1991.
  In addition, the bill authorizes the SBA and its microlending 
partners to provide supplemental technical assistance in the form of 
transportation and child care assistance, to be paid from funds made 
available by other agencies. The House report on this bill reflected a 
concern expressed by two Democratic members, Messrs. Baldacci and 
Flake, regarding the availability of transportation in economically 
depressed areas and the obstacles it poses to people looking for work. 
The committee encourages funding of for-profit and cooperative 
transportation businesses to provide links between these communities 
and job opportunities.
  Title III of the bill expands on SBA's programs for Women's Business 
Enterprises, including Women Business Centers, the SBA's Office of 
Women's Business Ownership, and the Women's Business Council, an 
effective advocacy organization. I am especially pleased that this bill 
continues strong support for women's business efforts, including 
expanding the women's business center program, which provides seed 
funding for business training centers across the country and is one of 
the most successful programs which SBA operates. The bill establishes a 
funding formula for grantees receiving funds under this program, 
increasing the time to 5 years, but requiring an increasing number of 
non-Federal dollars for each Federal dollar, 2 non-Federal dollars for 
each Federal dollar in funding during years four and five, for example.
  Title V contains miscellaneous provisions. For example, section 502 
encourages SBA to develop and expand an international trade data 
network. This title also extends the Preferred Surety Bond Program 
through fiscal year 2000. And, section 506 directs SBA to coordinate 
its programs and offer specific assistance to small businesses that may 
have been adversely affected by NAFTA.
  Chairman Talent has included in the bill a manager's amendment, which 
includes, first, a technical amendment; second, provisions to require 
SBA to conduct a study on the small business needs of disabled veterans 
and to expand SBA outreach to such veterans; and third, a 
reauthorization for the Small Business Technology Transfer [STTR] 
Program. After negotiations with the Science Committee, Chairman Talent 
and I agreed to a simple bill which reauthorizes the STTR program for 3 
years. The bill, reported out by the Science Committee, does not in any 
way change the STTR program.
  In summary, the bill will allow continuation of these current SBA 
programs, some of the

[[Page H8079]]

most effective business programs operated by the U.S. Government, and 
makes changes to improve their effectiveness for small businesses, 
while protecting the government's interest. I strongly urge an 
affirmative vote for H.R. 2261 today, so that we could go to conference 
before the financial assistance and other SBA programs expire on 
September 30. Finally, I want to thank Chairman Talent and his staff 
for their cooperation in the process of coming up with this excellent 
bill.
  Mr. Speaker, I reserve the balance of my time.
  Mr. TALENT. Mr. Speaker, I thank the gentleman for his kind comments, 
and I yield 2 minutes to the gentleman from Florida [Mr. Miller].
  Mr. MILLER of Florida. Mr. Speaker, as a former small businessman 
before entering Congress, I certainly recognize the importance of small 
business. My community in Florida, in Sarasota, is totally dependent on 
small business. And certainly the Small Business Administration does a 
lot of very fine things and should continue.

                              {time}  1315

  I have some concerns, this being brought up under suspension, for a 
rather significant increase in money, and maybe I need to have 
explained to me a little bit more, because the total amount of money 
authorized is a significant increase over what is currently being 
appropriated, and I recognize this still has to go through the 
appropriation process, and as a member of the Committee on 
Appropriations, though not the subcommittee for small business, I will 
be able to follow this.
  But under the 1997 bill, appropriation bill, we have an authorization 
or outlays of $820 million, and it is going to increase next year to 
$1.3 billion. So it is a rather significant increase that concerns me, 
that we are doing this under suspension, where we have no opportunity 
to offer amendments and question it. While there are many good 
programs, there have been concerns about set-aside issues also under 
the Small Business Administration.
  So, I, or I think the gentleman from California [Mr. Condit], may be 
asking for a recorded vote because of concerns of bringing this under 
this particular suspension.
  Mr. TALENT. Mr. Speaker, I yield myself such time as I may consume, 
and I appreciate the gentleman's comments.
  Let me just say that if we take the reauthorization levels over the 
next 3 years, the authorization is not going up, it is going down. The 
bill does not mention or refer to any of the set-aside programs in the 
Small Business Administration, and that was done deliberately as a 
result of agreement between the gentleman and myself. In fact, this is 
one of the few major bills dealing with any of the agencies which does 
not mention any of the set-aside programs.
  For example, we have voted on appropriations bills that have come out 
of the Committee on Appropriations, in which the gentleman serves, most 
of which have some kind of set-aside programs. We are debating right 
now the Commerce, State, and Justice appropriations bill which funds 
the Small Business Administration, including the 8(a) program which is 
a set-aside program, and that might be a good opportunity, if the 
gentleman wants to raise the point, to raise that whole issue. We have 
not done it here.
  This is a bill which reauthorizes a number of important programs, 
including the disaster relief program. Members need to understand that 
if we do not pass this bill, that program will run out at the end of 
the fiscal year unless it is extended by a CR.
  We are moving toward privatization of a number of these lending 
programs and greater efficiency in these programs. The gentleman knows 
that the appropriations for the SBA is going down, and I would expect 
that it would continue to go down under this authorization, and that is 
certainly my intention.
  As for bringing up on suspension, we are getting near the end of the 
year. The bill came out unanimously from committee. It does an awful 
lot of good things, and up until the last few days nobody had raised 
any issues. I would maintain that the issue regarding set-asides is 
extraneous to this bill, although, of course, Members are entitled to 
conclude what they want.
  So I hope the Members will support this, and I understand the issue 
regarding set-asides is a very important one. I feel strongly about it 
myself, but it is truly extraneous to this bill, and I would suggest 
that Members look for other vehicles if they do want to raise the 
issue.
  Mr. LaFALCE. Mr. Speaker, I yield 5 minutes to the gentleman from 
Texas [Mr. Bentsen].
  (Mr. BENTSEN asked and was given permission to revise and extend his 
remarks.)
  Mr. BENTSEN. Mr. Speaker, I thank the gentleman for yielding this 
time to me, and there is an issue within this bill that I wanted to 
discuss, if I could, with both the chairman and the ranking member as 
it relates to the unsecuritized portion of 7(a) loans.
  I am a former, I served on this committee in the last Congress, I do 
not serve on the committee in this Congress, and in the last Congress 
when we were working on this bill, the issue of certain SBA rules as it 
related to the unsecuritized portion of 7(a) loans came up.
  I have a great deal of concern with the SBA and the direction that 
they are headed on this. I appreciate the fact that the bill, as I 
understand it, either asked or requires the SBA to address this issue 
within 90 days of enactment, and, if I could, during my time I would 
like to discuss this with both the chairman and the ranking member.
  Mr. TALENT. Mr. Speaker, will the gentleman yield?
  Mr. BENTSEN. I yield to the gentleman from Missouri.
  Mr. TALENT. I would be happy to discuss this with the gentleman. This 
is the securitization the gentleman has been talking about?
  Mr. BENTSEN. The gentleman is correct.
  Mr. TALENT. Mr. Speaker, I appreciate the gentleman's good work on 
this.
  The agency has had this issue, as the gentleman knows, since the bill 
we passed last year. I am hopeful that the agency can come up with a 
set of regulations that do advance the ability of both bank and nonbank 
lenders to securitize these on the secondary market as much as is 
consistent, of course, with sound lending practices, and I recognize 
the gentleman's background on that, and I am very pleased that he is 
working to midwife some acceptable compromise in that area.
  Mr. BENTSEN. Also, reclaiming my time, I have been in some meetings 
with the SBA about this. I agree that we need to ensure that there are 
prudent lending standards that ensure the safety and soundness as it 
relates to the tax back guarantee of the 7(a) loans and how that 
relates to the unsecuritized portion.
  I do have some concerns with what SBA has been proposing that may, in 
fact, go overboard and, in fact, may have additional motives beyond 
safety and soundness, which is what I think primarily the concern of 
the committee and House ought to be.
  Mr. LaFALCE. Mr. Speaker, will the gentleman yield?
  Mr. BENTSEN. I yield to my colleague from New York, who is also aware 
of this.
  Mr. LaFALCE. Mr. Speaker, this is an issue that both the chairman and 
I have discussed at considerable length, we have discussed with 
representatives from the Small Business Administration, and I am 
concerned that we do not have some more definitive position coming from 
the SBA.
  We had hoped in the last Congress that they would have promulgated 
definitive regulations by this time. But in consultation with them, I 
became concerned that they might be confusing their purposes, that they 
instead of focusing exclusively on securitization issues, on 
creditworthy issues and safety and soundness issues, et cetera, they 
might be focusing additionally on the issue of concentration of 
lending. And I think it is appropriate for them to focus on 
concentration of lending and do something about it, if it is necessary, 
but not within the context of securitization rules. They are totally 
separate and distinct. They should deal with securitization issues and 
promulgating securitization rules. They should deal with concentration 
issues by promulgating concentration rules if need be.
  Further, there is clearly a distinction between insured depository 
institutions and nonbank lenders, and while we want rough parity, that 
does not mean that we must have identity of

[[Page H8080]]

treatment; at least that is my judgment, and of course it is up to the 
SBA to make their own independent judgment exclusively based upon their 
perception of the public interest.
  Mr. BENTSEN. Mr. Speaker, I thank the gentleman for his comment, and, 
reclaiming my time, I will just close by saying that we need and the 
SBA needs to understand that we are dealing with sophisticated markets 
here which are fairly transparent and that I would hope that we would 
continue to have as much efficiency as the chairman spoke about while 
maintaining and preserving safety and soundness.
  And I also would like to say for Members of the House that I 
congratulate the chairman on this bill, I think, being his first major 
bill, his first time as chairman, and of course the ranking member, and 
I am in strong support of the legislation, and I appreciate the fact 
that it does address this issue.
  Mr. LaFALCE. Mr. Speaker, I have no further requests for time, and 
therefore I yield back the balance of my time.
  Mr. TALENT. Mr. Speaker, I yield myself such time as I may consume.
  Mr. Speaker, I just want to say because I want to make sure I did not 
misspeak before, when we authorize these lending programs in this 
committee, the authorization level goes to the total amount of loans 
that are authorized; in other words, the total loan volume.
  We do expect that as a result of the kinds of changes that are being 
instituted in the last few years and over at the agency the amount of 
loan volume that we will be able to support with current or less 
appropriations levels is going to go up. In other words, I anticipate 
that we will continue to reduce appropriations for the lending programs 
for this agency.
  At the same time, I do expect that the loan volume is going to go up, 
so I think we are going to see appropriations going down; it is going 
down this year. This agency is more than going to do its part in terms 
of meeting a balanced budget, but I would expect the overall loan 
volumes, I hope that we can support with those appropriations, to go 
up.
  Mr. SENSENBRENNER. Mr. Speaker, last week in a bipartisan effort, the 
Committee on Science favorably reported H.R. 2429, as amended, a bill 
to reauthorize the Small Business Technology Transfer Program [STTR] 
through fiscal year 2000. This week, the Committee on Science and the 
Committee on Small Business, again working in a bipartisan fashion, 
have agreed to incorporate H.R. 2429 into H.R. 2261, the Small Business 
Programs Reauthorization and Amendments Acts of 1997.
  I would like to thank the ranking member of the Science committee, 
Mr. Brown, the Subcommittee on Technology chairwoman, Mrs. Morella, and 
the ranking member of that subcommittee, Mr. Gordon, for their efforts 
to reauthorize STTR. I would also like to thank the chairman of the 
Committee on Small Business, Mr. Talent, for the great cooperation he 
and all his staff have shown in working with the Science Committee to 
reauthorize STTR.
  STTR was started as a pilot program in 1994. STTR was enacted to 
provide high technology, small businesses across the country an 
opportunity to receive Federal R&D funding for ideas that were 
originated in, and developed in cooperation with, nonprofit research 
institutions such as universities. It is financed by a 0.15 percent 
set-aside from the extramural R&D budgets of five agencies: the 
Department of Defense, the Department of Energy, the National 
Institutes of Health, the National Aeronautics and Space 
Administration, and the National Science Foundation.
  These ideas are developed under STTR in three phases. Phase I is a 1-
year grant of up to $100,000. It is primarily used to research the 
viability of a technology. After phase I, a company may apply for phase 
II funding. Phase II is a 2-year award, of up to $500,000. Phase II 
award winners will further develop the technology--with the goal of 
achieving phase III. Phase III is defined as commercialization of the 
technology, including use of the technology by the Government. STTR 
funds are not used for phase III.
  H.R. 2429 will reauthorize STTR at its current set-aside of 0.15 
percent through fiscal year 2000. The measure also makes some 
significant improvements to the program.
  H.R. 2429 requires the STTR participating agencies to include STTR in 
their annual performance plans, as required by the Results Act. This 
plan will result in each agency defining program goals and setting out 
metrics to measure these goals. I believe that the plan will give 
Congress a clearer picture of the effectiveness of the STTR Program. In 
addition to the performance plan, H.R. 2429 requires each agency to 
include programs under 15 U.S.C. 638 in their strategic plan updates, 
again a requirement under the Results Act.
  The STTR program has been criticized in some circles for the 
disparity of awards among States. To address this concern, H.R. 2429 
mandates the Small Business Administration to develop an outreach 
program for small businesses and universities from States that have not 
received 20 or more STTR or Small Business Innovation Research [SBIR] 
awards in the previous 2 fiscal years. I do not favor mandating a set-
aside for these States, but I do believe that through this program we 
will see an increase in the number of award applications, which should 
serve to strengthen STTR.
  Finally, H.R. 2429 assures that the Committee on Science will be 
added to the list of committee's receiving the Small Business 
Administration's annual report on the STTR and SBIR Programs.
  I am pleased that H.R. 2429 will be incorporated in its totality into 
H.R. 2261. It is also my understanding that the Committee on Science 
will have an equal number of conferees as the Small Business Committee 
on the STTR provision, when and if conference occurs with the Senate. I 
look forward to working with the Small Business Committee in 
representing the House position on the STTR Program.
  Mr. WEYGAND. Mr. Speaker, I rise in support of H.R. 2261, the Small 
Business Programs Reauthorization and Amendments Act of 1997. First, I 
would like to thank Chairman Talent and Mr. LaFalce for their 
leadership and for producing a bill that will undoubtedly benefit all 
small businesses. This bill reauthorizes the Small Business 
Administration and its programs which provide access to capital and 
services that might not otherwise be available to small business 
owners.
  To highlight the SBA's importance, I would like too showcase what the 
SBA is doing in my district, in Rhode Island. Over the past 4 years 
there have been significant increases in the number of Small Business 
Administration loans awarded. In fact the number of loans has more than 
doubled. In 1993, there were 115 approved loans totaling $32.6 million, 
in 1996, there were 292 loans totaling $53.3 million.
  Importantly, in my district alone there have been dramatic 
improvements in access to capital for women, minorities, and veterans. 
In 1993, there were 8 loans to minorities, 17 to women, and 14 to 
veterans. In 1996, we had 16 loans to minorities, 40 to women, and 46 
to veterans. That is, nearly 35 percent of all approved SBA loans are 
going to these three groups. By reauthorizing these programs we will 
continue to provide the access to capital that those groups need 
allowing us to expand opportunities to women, minorities, and veterans.
  I cannot overstate the impact of small business on Rhode Island's 
economy. Approximately 97 percent of all businesses in Rhode Island are 
classified as small businesses. These companies employ thousands of 
Rhode Islanders and provide the economic foundation of my State and our 
country. Small businesses play a vital role in job creation and provide 
endless opportunities for our citizens.
  Along with the financial programs, the SBA provides services to 
assist business owners in becoming or remaining successful. Once a 
business has a loan we must make sure that the business stays healthy 
and profitable enough to repay that loan. Services provided by programs 
such as Small Business Development Centers, Service Corps of Retired 
Entrepreneurs, Business Information Centers, Minority Enterprise 
Development program, and Women's Business Enterprise program supply 
information and counseling services to business owners. These services 
are invaluable to the smallest businesses who do not have the budgets 
to hire high-priced consultants.
  Small businesses are the backbone of our economy. They account for 53 
percent of the Nation's private workforce. Small businesses generate 
more than 50 percent of the gross domestic product and are the primary 
source growth across the country. We, as leaders, must do all we can to 
foster and encourage the development and growth of small businesses and 
this bill moves us in that direction. This bill will allow us to 
continue to support existing small businesses and encourage the 
development of new ones, both in Rhode Island and across the country. I 
urge my colleagues to support it.
  Mr. TALENT. Mr. Speaker, the primary purpose of H.R. 2261 is to 
reauthorize the Small Business Administration [SBA] and the programs 
which that agency manages by authority granted under the Small Business 
Act and the Small Business Investment Act through fiscal year 2000. The 
committee regularly authorizes these programs for a 3-year period, with 
the last reauthorization occurring in 1994 during the 103d Congress. 
The programs include the financial programs of the SBA: the 7(a) 
general business loan guarantee program, the Section 504 Certified 
Development

[[Page H8081]]

Company program, the Microloan program and the Small Business 
Investment Company [SBIC] program.
  In addition, the bill will reauthorize the technical assistance and 
procurement programs of the SBA--the Service Core of Retired Executives 
[SCORES], the Women's Business Center program, the Small Business 
Development Center [SBDC] program, the Competitiveness Demonstration 
program, and other.

  This legislation also changes and improves various programs, 
specifically modifying the Section 504 Preferred Certified Lender 
Program [PCLP], the SBIC program, the Women's Business Center program, 
and the SBDC program.
  The programs of the Small Business Administration annually provide 
over $14 billion of financial assistance to over 100,000 small 
businesses all across the United States. These financial programs 
remedy shortfalls in access to credit and capital for small businesses 
that are in need because of unfortunate imperfections in our national 
economy. By assuring financial assistance for amounts as small as $500 
to as much as $1,250,000, the SBA and its private sector partners--bank 
and non-bank lenders, surety bond insurers, certified development 
companies, microlenders, and small business investment companies--
provide a vital impetus to the small business sector of the economy. 
The SBA also provides hundreds of millions of dollars in vital disaster 
assistance to small businesses and homeowners every year.
  H.R. 2261 reflects the committee's dedication to and support for 
these programs and the belief that they are not only necessary but also 
constantly in need of refinement and improvement as the economy shifts 
and changes. The bill includes not only the basic reauthorization 
language necessary to continue regular operations but also changes to 
the underlying program structures.
  The bill includes significant improvements in the Preferred Certified 
Lender Program of the Section 504 Certified Development Company 
Program. These changes serve to help implement the committee's goals of 
increased reliance on private sector lending partners. The committee 
seeks to both enable the certified development companies to take 
additional responsibility for servicing, liquidation, and litigation of 
defaulted loans, and to improve the recoveries for this program.
  Committee hearings revealed that recoveries are, in fact, the largest 
single factor in the increased subsidy cost of the 504 program. The 
committee continues to be concerned over the subsidy estimates for the 
7(a) and 504 programs and makes these changes in the 504 program in 
order to encourage private sector participation in the liquidation 
process.
  H.R. 2261 also continues the committee's work on improving the Small 
Business Investment Company program. Last year this program underwent 
significant changes, and this year the committee seeks to build on 
those improvements by providing SBIC's with increased flexibility and 
some responsiveness in order to better allow the SBIC's to interact in 
the marketplace and thereby reduce risks of loss.
  The bill also reauthorizes and improves the Microloan program. Begun 
in 1991, this program has served the smallest and often least noticed 
segment of the small business community. The committee has recognized 
the efficacy of this program and changed it from demonstration to 
permanent program status.
  In addition to financial assistance, the SBA also provides technical 
and managerial advice and assistance to hundreds of thousands of small 
businesses every year through the small business development 
centers, the women's business centers, and the Service Corps of Retired 
Executives. The committee reauthorizes these programs in H.R. 2261 and 
makes some valuable improvements to both the Women's Business Center 
and Small Business Development Center programs.

  The measure before us has two additional components that were added 
to this legislation since our committee reported it. These additional 
elements have been added as a result of bipartisan efforts; and, in 
fact, have involved the collective work of multiple committees. Title 
VI of H.R. 2261, as amended, contains a number of provisions which are 
designed to assist the Federal Government in better serving service 
disabled veterans and small businesses owned by service disabled 
veterans. These measures are the product of bipartisan efforts by 
myself and our committee's ranking member, working together with the 
chairman of the Rules Committee and the chairman of the Committee on 
Veterans' Affairs.
  Title VII of this legislation is also the product of a bipartisan and 
multicommittee effort between the Small Business Committee and the 
Science Committee. Title VII contains H.R. 2429, as reported by the 
Committee on Science, which is a 3-year reauthorization of the Pilot 
Small Business Technology Transfer [STTR] program. Building upon the 
established model of the Small Business Innovation Research [SBIR] 
program, the STTR Program provides the statutory basis for structured 
collaborations between small technology entrepreneurs and nonprofit 
research institutions, such as universities or Federal-funded research 
and development centers [FFRDC's], to foster commercialization of the 
results of federally sponsored research.
  Mr. Speaker, H.R. 2261 is the product of bipartisan efforts in our 
committee to reauthorize the Small Business Administration through 
fiscal year 2000. It also reflects the efforts of other individuals and 
committees and their staffs. I would like to thank Mr. Sensenbrenner, 
the chairman of the Committee on Science, and Mr. Brown, his ranking 
member, for their work on H.R. 2429, which has become title VII of this 
legislation. I would also like to express my appreciation to their 
staff who worked on this. I would also like to thank Mr. Stump, the 
chairman of the Veterans' Affairs Committee, and Mr. Solomon, the 
chairman of the Rules Committee, along with their staffs, for their 
help in working on title VI of this legislation. I would also like to 
thank our committee's ranking member, Mr. LaFalce, for all of his help 
in helping to craft this legislation and assisting in bringing it to 
this floor. Finally, I would like to acknowledge the Small Business 
Committee staff who worked on this legislation: Emily Murphy, Mary 
McKenzie, Charles ``Tee'' Rowe, and Harry Katrichis for the majority, 
and Jeanne Roslanowick, Steve McSpadden, and Tom Powers for the 
minority.
  I urge my colleagues to vote for this important legislation.
  Mrs. MORELLA. Mr. Speaker, I am delighted that the bipartisan bill 
H.R. 2429 will be included as an amendment to the small business 
reauthorization bill. I would like to thank Chairman Sensenbrenner; 
ranking member, Mr. Brown; the ranking member of the Subcommittee on 
Technology, Mr. Gordon; Mr. Bartlett, as well as the other members from 
the Committee on Small Business who have cosponsored H.R. 2429.
  The STTR program expires on September 30th of this year. H.R. 2429 
will reauthorize STTR at its current set-aside level through fiscal 
year 2000. This will put STTR on the same timeline as its parent 
program, the Small Business Innovation Research Program.
  STTR fosters collaboration between small businesses and research 
institutions to develop high-technology projects that can one day reach 
the marketplace or be used by the Federal Government. Since its 
inception, STTR has made nearly 800 awards totaling over $115 million. 
Of those totals, 42 awards for $4.8 million have gone to Maryland small 
businesses.
  As Chairman Sensenbrenner has stated, H.R. 2429 addresses some 
important concerns regarding the STTR Program, including establishing 
goals for the program, and establishing an outreach program to increase 
the participation of those states that have been under-represented in 
the STTR Program.
  STTR began in 1994. Very few ideas have even reached the phase II 
level. Because of its infancy, it was difficult to determine whether 
STTR was a success or not. I hope that--with the changes made by H.R. 
2429--along with 3 more years of data, Congress will have a better idea 
of the effectiveness and success of the program when its 
reauthorization expires in the year 2000.
  Mr. TALENT. I have no further speakers on this side, Mr. Speaker, and 
so I yield back the balance of my time.
  The SPEAKER pro tempore. The question is on the motion offered by the 
gentleman from Missouri [Mr. Talent] that the House suspend the rules 
and pass the bill, H.R. 2261, as amended.
  The question was taken.
  Mr. MILLER of Florida. Mr. Speaker, I object to the vote on the 
ground that a quorum is not present and make the point of order that a 
quorum is not present.
  The SPEAKER pro tempore. Pursuant to clause 5, rule I, and the 
Chair's prior announcement, further proceedings on this motion will be 
postponed.
  The point of no quorum is considered withdrawn.

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