[Congressional Record Volume 143, Number 157 (Sunday, November 9, 1997)]
[House]
[Pages H10486-H10504]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]
SMALL BUSINESS REAUTHORIZATION ACT OF 1997
Mr. TALENT. Mr. Speaker, I move to suspend the rules and concur in
the Senate amendment to the House amendment to the Senate bill, S.
1139, to reauthorize the programs of the Small Business Administration,
and for other purposes.
The Clerk read as follows:
Senate amendment to House amendment:
In lieu of the matter proposed to be inserted by the House
amendment to the text of the bill, insert:
SECTION 1. SHORT TITLE; TABLE OF CONTENTS.
(a) Short Title.--This Act may be cited as the ``Small
Business Reauthorization Act of 1997''.
(b) Table of Contents.--The table of contents for this Act
is as follows:
Sec. 1. Short title; table of contents.
Sec. 2. Definitions.
Sec. 3. Effective date.
TITLE I--AUTHORIZATIONS
Sec. 101. Authorizations.
TITLE II--FINANCIAL ASSISTANCE
Subtitle A--Microloan Program
Sec. 201. Microloan program.
Sec. 202. Welfare-to-work microloan initiative.
Subtitle B--Small Business Investment Company Program
Sec. 211. 5-year commitments for SBICs at option of Administrator.
Sec. 212. Underserved areas.
Sec. 213. Private capital.
Sec. 214. Fees.
Sec. 215. Small business investment company program reform.
Sec. 216. Examination fees.
Subtitle C--Certified Development Company Program
Sec. 221. Loans for plant acquisition, construction, conversion, and
expansion.
Sec. 222. Development company debentures.
Sec. 223. Premier certified lenders program.
Subtitle D--Miscellaneous Provisions
Sec. 231. Background check of loan applicants.
Sec. 232. Report on increased lender approval, servicing, foreclosure,
liquidation, and litigation of section 7(a) loans.
Sec. 233. Completion of planning for loan monitoring system.
TITLE III--WOMEN'S BUSINESS ENTERPRISES
Sec. 301. Interagency committee participation.
Sec. 302. Reports.
Sec. 303. Council duties.
Sec. 304. Council membership.
Sec. 305. Authorization of appropriations.
Sec. 306. National Women's Business Council procurement project.
Sec. 307. Studies and other research.
Sec. 308. Women's business centers.
TITLE IV--COMPETITIVENESS PROGRAM AND PROCUREMENT OPPORTUNITIES
Subtitle A--Small Business Competitiveness Program
Sec. 401. Program term.
Sec. 402. Monitoring agency performance.
Sec. 403. Reports to Congress.
Sec. 404. Small business participation in dredging.
Sec. 405. Technical amendments.
Subtitle B--Small Business Procurement Opportunities Program
Sec. 411. Contract bundling.
Sec. 412. Definition of contract bundling.
Sec. 413. Assessing proposed contract bundling.
Sec. 414. Reporting of bundled contract opportunities.
Sec. 415. Evaluating subcontract participation in awarding contracts.
Sec. 416. Improved notice of subcontracting opportunities.
Sec. 417. Deadlines for issuance of regulations.
TITLE V--MISCELLANEOUS PROVISIONS
Sec. 501. Small Business Technology Transfer program.
Sec. 502. Small Business Development Centers.
Sec. 503. Pilot preferred surety bond guarantee program extension.
Sec. 504. Extension of cosponsorship authority.
Sec. 505. Asset sales.
Sec. 506. Small business export promotion.
Sec. 507. Defense Loan and Technical Assistance program.
Sec. 508. Very small business concerns.
Sec. 509. Trade assistance program for small business concerns
adversely affected by NAFTA.
TITLE VI--HUBZONE PROGRAM
Sec. 601. Short title.
Sec. 602. Historically underutilized business zones.
Sec. 603. Technical and conforming amendments to the Small Business
Act.
Sec. 604. Other technical and conforming amendments.
Sec. 605. Regulations.
Sec. 606. Report.
Sec. 607. Authorization of appropriations.
TITLE VII--SERVICE DISABLED VETERANS
Sec. 701. Purposes.
Sec. 702. Definitions.
Sec. 703. Report by Small Business Administration.
Sec. 704. Information collection.
Sec. 705. State of small business report.
Sec. 706. Loans to veterans.
Sec. 707. Entrepreneurial training, counseling, and management
assistance.
Sec. 708. Grants for eligible veterans' outreach programs.
Sec. 709. Outreach for eligible veterans.
SEC. 2. DEFINITIONS.
In this Act--
(1) the term ``Administration'' means the Small Business
Administration;
(2) the term ``Administrator'' means the Administrator of
the Small Business Administration;
(3) the term ``Committees'' means the Committees on Small
Business of the House of Representatives and the Senate; and
(4) the term ``small business concern'' has the meaning
given the term in section 3 of the Small Business Act (15
U.S.C. 632).
SEC. 3. EFFECTIVE DATE.
This Act and the amendments made by this Act shall take
effect on October 1, 1997.
TITLE I--AUTHORIZATIONS
SEC. 101. AUTHORIZATIONS.
Section 20 of the Small Business Act (15 U.S.C. 631 note)
is amended by striking subsections (c) through (q) and
inserting the following:
``(c) Fiscal Year 1998.--
``(1) Program levels.--The following program levels are
authorized for fiscal year 1998:
``(A) For the programs authorized by this Act, the
Administration is authorized to make--
``(i) $40,000,000 in technical assistance grants, as
provided in section 7(m); and
``(ii) $60,000,000 in direct loans, as provided in section
7(m).
``(B) For the programs authorized by this Act, the
Administration is authorized to make $16,040,000,000 in
deferred participation loans and other financings. Of such
sum, the Administration is authorized to make--
[[Page H10487]]
``(i) $12,000,000,000 in general business loans as provided
in section 7(a);
``(ii) $3,000,000,000 in financings as provided in section
7(a)(13) of this Act and section 504 of the Small Business
Investment Act of 1958;
``(iii) $1,000,000,000 in loans as provided in section
7(a)(21); and
``(iv) $40,000,000 in loans as provided in section 7(m).
``(C) For the programs authorized by title III of the Small
Business Investment Act of 1958, the Administration is
authorized to make--
``(i) $700,000,000 in purchases of participating
securities; and
``(ii) $600,000,000 in guarantees of debentures.
``(D) For the programs authorized by part B of title IV of
the Small Business Investment Act of 1958, the Administration
is authorized to enter into guarantees not to exceed
$2,000,000,000, of which not more than $650,000,000 may be in
bonds approved pursuant to section 411(a)(3) of that Act.
``(E) The Administration is authorized to make grants or
enter into cooperative agreements--
``(i) for the Service Corps of Retired Executives program
authorized by section 8(b)(1), $4,000,000; and
``(ii) for activities of small business development centers
pursuant to section 21(c)(3)(G), $15,000,000, to remain
available until expended.
``(2) Additional authorizations.--
``(A) There are authorized to be appropriated to the
Administration for fiscal year 1998 such sums as may be
necessary to carry out this Act, including administrative
expenses and necessary loan capital for disaster loans
pursuant to section 7(b), and to carry out the Small Business
Investment Act of 1958, including salaries and expenses of
the Administration.
``(B) Notwithstanding subparagraph (A), for fiscal year
1998--
``(i) no funds are authorized to be provided to carry out
the loan program authorized by section 7(a)(21) except by
transfer from another Federal department or agency to the
Administration, unless the program level authorized for
general business loans under paragraph (1)(B)(i) is fully
funded; and
``(ii) the Administration may not approve loans on behalf
of the Administration or on behalf of any other department or
agency, by contract or otherwise, under terms and conditions
other than those specifically authorized under this Act or
the Small Business Investment Act of 1958, except that it may
approve loans under section 7(a)(21) of this Act in gross
amounts of not more than $1,250,000.
``(d) Fiscal Year 1999.--
``(1) Program levels.--The following program levels are
authorized for fiscal year 1999:
``(A) For the programs authorized by this Act, the
Administration is authorized to make--
``(i) $40,000,000 in technical assistance grants as
provided in section 7(m); and
``(ii) $60,000,000 in direct loans, as provided in section
7(m).
``(B) For the programs authorized by this Act, the
Administration is authorized to make $17,540,000,000 in
deferred participation loans and other financings. Of such
sum, the Administration is authorized to make--
``(i) $13,000,000,000 in general business loans as provided
in section 7(a);
``(ii) $3,500,000,000 in financings as provided in section
7(a)(13) of this Act and section 504 of the Small Business
Investment Act of 1958;
``(iii) $1,000,000,000 in loans as provided in section
7(a)(21); and
``(iv) $40,000,000 in loans as provided in section 7(m).
``(C) For the programs authorized by title III of the Small
Business Investment Act of 1958, the Administration is
authorized to make--
``(i) $800,000,000 in purchases of participating
securities; and
``(ii) $700,000,000 in guarantees of debentures.
``(D) For the programs authorized by part B of title IV of
the Small Business Investment Act of 1958, the Administration
is authorized to enter into guarantees not to exceed
$2,000,000,000, of which not more than $650,000,000 may be in
bonds approved pursuant to section 411(a)(3) of that Act.
``(E) The Administration is authorized to make grants or
enter cooperative agreements--
``(i) for the Service Corps of Retired Executives program
authorized by section 8(b)(1), $4,500,000; and
``(ii) for activities of small business development centers
pursuant to section 21(c)(3)(G), not to exceed $15,000,000,
to remain available until expended.
``(2) Additional authorizations.--
``(A) There are authorized to be appropriated to the
Administration for fiscal year 1999 such sums as may be
necessary to carry out this Act, including administrative
expenses and necessary loan capital for disaster loans
pursuant to section 7(b), and to carry out the Small Business
Investment Act of 1958, including salaries and expenses of
the Administration.
``(B) Notwithstanding subparagraph (A), for fiscal year
1999--
``(i) no funds are authorized to be provided to carry out
the loan program authorized by section 7(a)(21) except by
transfer from another Federal department or agency to the
Administration, unless the program level authorized for
general business loans under paragraph (1)(B)(i) is fully
funded; and
``(ii) the Administration may not approve loans on behalf
of the Administration or on behalf of any other department or
agency, by contract or otherwise, under terms and conditions
other than those specifically authorized under this Act or
the Small Business Investment Act of 1958, except that it may
approve loans under section 7(a)(21) of this Act in gross
amounts of not more than $1,250,000.
``(e) Fiscal Year 2000.--
``(1) Program levels.--The following program levels are
authorized for fiscal year 2000:
``(A) For the programs authorized by this Act, the
Administration is authorized to make--
``(i) $40,000,000 in technical assistance grants as
provided in section 7(m); and
``(ii) $60,000,000 in direct loans, as provided in section
7(m).
``(B) For the programs authorized by this Act, the
Administration is authorized to make $20,040,000,000 in
deferred participation loans and other financings. Of such
sum, the Administration is authorized to make--
``(i) $14,500,000,000 in general business loans as provided
in section 7(a);
``(ii) $4,500,000,000 in financings as provided in section
7(a)(13) of this Act and section 504 of the Small Business
Investment Act of 1958;
``(iii) $1,000,000,000 in loans as provided in section
7(a)(21); and
``(iv) $40,000,000 in loans as provided in section 7(m).
``(C) For the programs authorized by title III of the Small
Business Investment Act of 1958, the Administration is
authorized to make--
``(i) $900,000,000 in purchases of participating
securities; and
``(ii) $800,000,000 in guarantees of debentures.
``(D) For the programs authorized by part B of title IV of
the Small Business Investment Act of 1958, the Administration
is authorized to enter into guarantees not to exceed
$2,000,000,000, of which not more than $650,000,000 may be in
bonds approved pursuant to section 411(a)(3) of that Act.
``(E) The Administration is authorized to make grants or
enter cooperative agreements--
``(i) for the Service Corps of Retired Executives program
authorized by section 8(b)(1), $5,000,000; and
``(ii) for activities of small business development centers
pursuant to section 21(c)(3)(G), not to exceed $15,000,000,
to remain available until expended.
``(2) Additional authorizations.--
``(A) There are authorized to be appropriated to the
Administration for fiscal year 2000 such sums as may be
necessary to carry out this Act, including administrative
expenses and necessary loan capital for disaster loans
pursuant to section 7(b), and to carry out the Small Business
Investment Act of 1958, including salaries and expenses of
the Administration.
``(B) Notwithstanding subparagraph (A), for fiscal year
2000--
``(i) no funds are authorized to be provided to carry out
the loan program authorized by section 7(a)(21) except by
transfer from another Federal department or agency to the
Administration, unless the program level authorized for
general business loans under paragraph (1)(B)(i) is fully
funded; and
``(ii) the Administration may not approve loans on behalf
of the Administration or on behalf of any other department or
agency, by contract or otherwise, under terms and conditions
other than those specifically authorized under this Act or
the Small Business Investment Act of 1958, except that it may
approve loans under section 7(a)(21) of this Act in gross
amounts of not more than $1,250,000.''.
TITLE II--FINANCIAL ASSISTANCE
Subtitle A--Microloan Program
SEC. 201. MICROLOAN PROGRAM.
(a) Loan Limits.--Section 7(m)(3)(C) of the Small Business
Act (15 U.S.C. 636(m)(3)(C)) is amended by striking
``$2,500,000'' and inserting ``$3,500,000''.
(b) Loan Loss Reserve Fund.--Section 7(m)(3)(D) of the
Small Business Act (15 U.S.C. 636(m)(3)(D)) is amended by
striking clauses (i) and (ii), and inserting the following:
``(i) during the initial 5 years of the intermediary's
participation in the program under this subsection, at a
level equal to not more than 15 percent of the outstanding
balance of the notes receivable owed to the intermediary; and
``(ii) in each year of participation thereafter, at a level
equal to not more than the greater of--
``(I) 2 times an amount reflecting the total losses of the
intermediary as a result of participation in the program
under this subsection, as determined by the Administrator on
a case-by-case basis; or
``(II) 10 percent of the outstanding balance of the notes
receivable owed to the intermediary.''.
(c) Authorization of Appropriations.--Section 7(m) of the
Small Business Act (15 U.S.C. 636(m)) is amended--
(1) in the subsection heading, by striking
``Demonstration'';
(2) by striking ``Demonstration'' each place that term
appears;
(3) by striking ``demonstration'' each place that term
appears; and
(4) in paragraph (12), by striking ``during fiscal years
1995 through 1997'' and inserting ``during fiscal years 1998
through 2000''.
(d) Technical Assistance Grants.--Section 7(m) of the Small
Business Act (15 U.S.C. 636(m)) is amended--
(1) in paragraph (4)(E)--
(A) by striking ``Each intermediary'' and inserting the
following:
``(i) In general.--Each intermediary'';
(B) by striking ``15'' and inserting ``25''; and
(C) by adding at the end the following:
``(ii) Technical assistance.--An intermediary may expend
not more than 25 percent of the funds received under
paragraph (1)(B)(ii) to enter into third party contracts for
the provision of technical assistance.''; and
(2) in paragraph (5)(A)--
(A) by striking ``in each of the 5 years of the
demonstration program established under this subsection,'';
and
(B) by striking ``for terms of up to 5 years'' and
inserting ``annually''.
SEC. 202. WELFARE-TO-WORK MICROLOAN INITIATIVE.
(a) Initiative.--Section 7(m) of the Small Business Act (15
U.S.C. 636(m)) is amended--
[[Page H10488]]
(1) in paragraph (1)(A)--
(A) in clause (ii), by striking ``and'' at the end;
(B) in clause (iii), by striking the period at the end and
inserting ``; and''; and
(C) by adding at the end the following:
``(iv) to establish a welfare-to-work microloan initiative,
which shall be administered by the Administration, in order
to test the feasibility of supplementing the technical
assistance grants provided under clauses (ii) and (iii) of
subparagraph (B) to individuals who are receiving assistance
under the State program funded under part A of title IV of
the Social Security Act (42 U.S.C. 601 et seq.), or under any
comparable State funded means tested program of assistance
for low-income individuals, in order to adequately assist
those individuals in--
``(I) establishing small businesses; and
``(II) eliminating their dependence on that assistance.'';
(2) in paragraph (4), by adding at the end the following:
``(F) Supplemental grant.--
``(i) In general.--The Administration may accept any funds
transferred to the Administration from other departments or
agencies of the Federal Government to make grants in
accordance with this subparagraph and section 202(b) of the
Small Business Reauthorization Act of 1997 to participating
intermediaries and technical assistance providers under
paragraph (5), for use in accordance with clause (iii) to
provide additional technical assistance and related services
to recipients of assistance under a State program described
in paragraph (1)(A)(iv) at the time they initially apply for
assistance under this subparagraph.
``(ii) Eligible recipients; grant amounts.--In making
grants under this subparagraph, the Administration may
select, from among participating intermediaries and technical
assistance providers described in clause (i), not more than
20 grantees in fiscal year 1998, not more than 25 grantees in
fiscal year 1999, and not more than 30 grantees in fiscal
year 2000, each of whom may receive a grant under this
subparagraph in an amount not to exceed $200,000 per year.
``(iii) Use of grant amounts.--Grants under this
subparagraph--
``(I) are in addition to other grants provided under this
subsection and shall not require the contribution of matching
amounts as a condition of eligibility; and
``(II) may be used by a grantee--
``(aa) to pay or reimburse a portion of child care and
transportation costs of recipients of assistance described in
clause (i), to the extent such costs are not otherwise paid
by State block grants under the Child Care Development Block
Grant Act of 1990 (42 U.S.C. 9858 et seq.) or under part A of
title IV of the Social Security Act (42 U.S.C. 601 et seq.);
and
``(bb) for marketing, management, and technical assistance
to recipients of assistance described in clause (i).
``(iv) Memorandum of understanding.--Prior to accepting any
transfer of funds under clause (i) from a department or
agency of the Federal Government, the Administration shall
enter into a Memorandum of Understanding with the department
or agency, which shall--
``(I) specify the terms and conditions of the grants under
this subparagraph; and
``(II) provide for appropriate monitoring of expenditures
by each grantee under this subparagraph and each recipient of
assistance described in clause (i) who receives assistance
from a grantee under this subparagraph, in order to ensure
compliance with this subparagraph by those grantees and
recipients of assistance.'';
(3) in paragraph (6), by adding at the end the following:
``(E) Establishment of child care or transportation
businesses.--In addition to other eligible small businesses
concerns, borrowers under any program under this subsection
may include individuals who will use the loan proceeds to
establish for-profit or nonprofit child care establishments
or businesses providing for-profit transportation
services.'';
(4) in paragraph (9)--
(A) by striking the paragraph designation and paragraph
heading and inserting the following:
``(9) Grants for management, marketing, technical
assistance, and related services.--''; and
(B) by adding at the end the following:
``(C) Welfare-to-work microloan initiative.--Of amounts
made available to carry out the welfare-to-work microloan
initiative under paragraph (1)(A)(iv) in any fiscal year, the
Administration may use not more than 5 percent to provide
technical assistance, either directly or through contractors,
to welfare-to-work microloan initiative grantees, to ensure
that, as grantees, they have the knowledge, skills, and
understanding of microlending and welfare-to-work transition,
and other related issues, to operate a successful welfare-to-
work microloan initiative.''; and
(5) by adding at the end the following:
``(13) Evaluation of welfare-to-work microloan
initiative.--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 paragraph
(4)(F).''.
(b) Transfer of Funds.--
(1) In general.--No funds are authorized to be appropriated
or otherwise provided to carry out the grant program under
section 7(m)(4)(F) of the Small Business Act (15 U.S.C.
636(m)(4)(F)) (as added by this section), except by transfer
from another department or agency of the Federal Government
to the Administration in accordance with this subsection.
(2) Limitation on amounts.--The total amount transferred to
the Administration from other departments and agencies of the
Federal Government to carry out the grant program under
section 7(m)(4)(F) of the Small Business Act (15 U.S.C.
636(m)(4)(F)) (as added by this section) shall not exceed--
(A) $3,000,000 for fiscal year 1998;
(B) $4,000,000 for fiscal year 1999; and
(C) $5,000,000 for fiscal year 2000.
Subtitle B--Small Business Investment Company Program
SEC. 211. 5-YEAR COMMITMENTS FOR SBICS AT OPTION OF
ADMINISTRATOR.
Section 20(a)(2) of the Small Business Act (15 U.S.C. 631
note) is amended in the last sentence by striking ``the
following fiscal year'' and inserting ``any 1 or more of the
4 subsequent fiscal years''.
SEC. 212. UNDERSERVED AREAS.
Section 301(c)(4)(B) of the Small Business Investment Act
of 1958 (15 U.S.C. 681(c)(4)(B)) is amended to read as
follows:
``(B) Leverage.--An applicant licensed pursuant to the
exception provided in this paragraph shall not be eligible to
receive leverage as a licensee until the applicant satisfies
the requirements of section 302(a), unless the applicant--
``(i) files an application for a license not later than 180
days after the date of enactment of the Small Business
Reauthorization Act of 1997;
``(ii) is located in a State that is not served by a
licensee; and
``(iii) agrees to be limited to 1 tier of leverage
available under section 302(b), until the applicant meets the
requirements of section 302(a).''.
SEC. 213. PRIVATE CAPITAL.
Section 103(9)(B)(iii) of the Small Business Investment Act
of 1958 (15 U.S.C. 662(9)(B)(iii)) is amended--
(1) by redesignating subclauses (I) and (II) as subclauses
(II) and (III), respectively; and
(2) by inserting before subclause (II) (as redesignated)
the following:
``(I) funds obtained from the business revenues (excluding
any governmental appropriation) of any federally chartered or
government-sponsored corporation established prior to October
1, 1987;''.
SEC. 214. FEES.
Section 301 of the Small Business Investment Act of 1958
(15 U.S.C. 681) is amended by adding at the end the
following:
``(e) Fees.--
``(1) In general.--The Administration may prescribe fees to
be paid by each applicant for a license to operate as a small
business investment company under this Act.
``(2) Use of amounts.--Fees collected under this
subsection--
``(A) shall be deposited in the account for salaries and
expenses of the Administration; and
``(B) are authorized to be appropriated solely to cover the
costs of licensing examinations.''.
SEC. 215. SMALL BUSINESS INVESTMENT COMPANY PROGRAM REFORM.
(a) Bank Investments.--Section 302(b) of the Small Business
Investment Act of 1958 (15 U.S.C. 682(b)) is amended by
striking ``1956,'' and all that follows before the period and
inserting the following: ``1956, any national bank, or any
member bank of the Federal Reserve System or nonmember
insured bank to the extent permitted under applicable State
law, may invest in any 1 or more small business investment
companies, or in any entity established to invest solely in
small business investment companies, except that in no event
shall the total amount of such investments of any such bank
exceed 5 percent of the capital and surplus of the bank''.
(b) Indexing for Leverage.--Section 303 of the Small
Business Investment Act of 1958 (15 U.S.C. 683) is amended--
(1) in subsection (b)--
(A) in paragraph (2), by adding at the end the following:
``(D)(i) The dollar amounts in subparagraphs (A), (B), and
(C) shall be adjusted annually to reflect increases in the
Consumer Price Index established by the Bureau of Labor
Statistics of the Department of Labor.
``(ii) The initial adjustments made under this subparagraph
after the date of enactment of the Small Business
Reauthorization Act of 1997 shall reflect only increases from
March 31, 1993.''; and
(B) by striking paragraph (4) and inserting the following:
``(4) Maximum aggregate amount of leverage.--
``(A) In general.--Except as provided in subparagraph (B),
the aggregate amount of outstanding leverage issued to any
company or companies that are commonly controlled (as
determined by the Administrator) may not exceed $90,000,000,
as adjusted annually for increases in the Consumer Price
Index.
``(B) Exceptions.--The Administrator may, on a case-by-case
basis--
``(i) approve an amount of leverage that exceeds the amount
described in subparagraph (A) for companies under common
control; and
``(ii) impose such additional terms and conditions as the
Administrator determines to be appropriate to minimize the
risk of loss to the Administration in the event of default.
``(C) Applicability of other provisions.--Any leverage that
is issued to a company or companies commonly controlled in an
amount that exceeds $90,000,000, whether as a result of an
increase in the Consumer Price Index or a decision of the
Administrator, is subject to subsection (d).''; and
(2) by striking subsection (d) and inserting the following:
``(d) Required Certifications.--
``(1) In general.--The Administrator shall require each
licensee, as a condition of approval of an application for
leverage, to certify in writing--
``(A) for licensees with leverage less than or equal to
$90,000,000, that not less than 20 percent of the licensee's
aggregate dollar amount of
[[Page H10489]]
financings will be provided to smaller enterprises; and
``(B) for licensees with leverage in excess of $90,000,000,
that, in addition to satisfying the requirements of
subparagraph (A), 100 percent of the licensee's aggregate
dollar amount of financings made in whole or in part with
leverage in excess of $90,000,000 will be provided to smaller
enterprises (as defined in section 103(12)).
``(2) Multiple licensees.--Multiple licensees under common
control (as determined by the Administrator) shall be
considered to be a single licensee for purposes of
determining both the applicability of and compliance with the
investment percentage requirements of this subsection.''.
(c) Tax Distributions.--Section 303(g)(8) of the Small
Business Investment Act of 1958 (15 U.S.C. 683(g)(8)) is
amended by adding at the end the following: ``A company may
also elect to make a distribution under this paragraph at the
end of any calendar quarter based on a quarterly estimate of
the maximum tax liability. If a company makes 1 or more
quarterly distributions for a calendar year, and the
aggregate amount of those distributions exceeds the maximum
amount that the company could have distributed based on a
single annual computation, any subsequent distribution by the
company under this paragraph shall be reduced by an amount
equal to the excess amount distributed.''.
(d) Leverage Fee.--Section 303(i) of the Small Business
Investment Act of 1958 (15 U.S.C. 683(i)) is amended by
striking ``, payable upon'' and all that follows before the
period and inserting the following: ``in the following
manner: 1 percent upon the date on which the Administration
enters into any commitment for such leverage with the
licensee, and the balance of 2 percent (or 3 percent if no
commitment has been entered into by the Administration) on
the date on which the leverage is drawn by the licensee''.
(e) Periodic Issuance of Guarantees and Trust
Certificates.--Section 320 of the Small Business Investment
Act of 1958 (15 U.S.C. 687m) is amended by striking ``three
months'' and inserting ``6 months''.
SEC. 216. 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 C--Certified Development Company Program
SEC. 221. LOANS FOR PLANT ACQUISITION, CONSTRUCTION,
CONVERSION, AND EXPANSION.
Section 502 of the Small Business Investment Act of 1958
(15 U.S.C. 696) is amended--
(1) by striking paragraph (1) and inserting the following:
``(1) Use of proceeds.--The proceeds of any such loan shall
be used solely by the borrower to assist 1 or more
identifiable small business concerns and for a sound business
purpose approved by the Administration.'';
(2) in paragraph (3), by adding at the end the following:
``(D) Seller financing.--Seller-provided financing may be
used to meet the requirements of subparagraph (B), if the
seller subordinates the interest of the seller in the
property to the debenture guaranteed by the Administration.
``(E) Collateralization.--The collateral provided by the
small business concern shall generally include a subordinate
lien position on the property being financed under this
title, and is only 1 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.''; and
(3) by adding at the end the following:
``(5) Limitation on leasing.--In addition to any portion of
the project permitted to be leased under paragraph (4), not
to exceed 20 percent of the project may be leased by the
assisted small business to 1 or more other tenants, if the
assisted small business occupies permanently and uses not
less than a total of 60 percent of the space in the project
after the execution of any leases authorized under this
section.''.
SEC. 222. DEVELOPMENT COMPANY DEBENTURES.
Section 503 of the Small Business Investment Act of 1958
(15 U.S.C. 697) is amended--
(1) in subsection (b)(7), by striking subparagraph (A) and
inserting the following:
``(A) assesses and collects a fee, which shall be payable
by the borrower, in an amount established annually by the
Administration, which amount shall not exceed the lesser of--
``(i) 0.9375 percent per year of the outstanding balance of
the loan; and
``(ii) the minimum amount necessary to reduce the cost (as
defined in section 502 of the Federal Credit Reform Act of
1990) to the Administration of purchasing and guaranteeing
debentures under this Act to zero; and''; and
(2) in subsection (f), by striking ``1997'' and inserting
``2000''.
SEC. 223. PREMIER CERTIFIED LENDERS PROGRAM.
(a) In General.--Section 508 of the Small Business
Investment Act of 1958 (15 U.S.C. 697e) is amended--
(1) in subsection (a), by striking ``not more than 15'';
(2) in subsection (b)--
(A) in paragraph (2)--
(i) in the matter preceding subparagraph (A), by striking
``if such company'';
(ii) by striking subparagraphs (A) and (B) and inserting
the following:
``(A) if the company 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) if the company has a history of--
``(i) submitting to the Administration adequately analyzed
debenture guarantee application packages; and
``(ii) of properly closing section 504 loans and servicing
its loan portfolio;'';
(iii) in subparagraph (C)--
(I) by inserting ``if the company'' after ``(C)''; and
(II) by striking the period at the end and inserting ``;
and''; and
(iv) by adding at the end the following:
``(D) the Administrator determines, with respect to the
company, that the loss reserve established in accordance with
subsection (c)(2) is sufficient for the company to meet its
obligations to protect the Federal Government from risk of
loss.''; and
(B) by adding at the end the following:
``(3) Applicability of criteria after designation.--The
Administrator may revoke the designation of a certified
development company as a premier certified lender under this
section at any time, if the Administrator determines that the
certified development company does not meet any requirement
described in subparagraphs (A) through (D) of paragraph
(2).'';
(3) by striking subsection (c) and inserting the following:
``(c) Loss Reserve.--
``(1) Establishment.--A company designated as a premier
certified lender shall establish a loss reserve for financing
approved pursuant to this section.
``(2) Amount.--The amount of each loss reserve established
under paragraph (1) shall be 10 percent of the amount of the
company's exposure, as determined under subsection (b)(2)(C).
``(3) Assets.--Each loss reserve established under
paragraph (1) shall be comprised of--
``(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;
``(B) irrevocable letter or letters of credit, with a
collateral assignment in favor of, and a commercially
reasonable format acceptable to, the Administration; or
``(C) any combination of the assets described in
subparagraphs (A) and (B).
``(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.
``(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 premier
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 that has been
repaid.'';
(4) in subsection (d)(1), by striking ``to approve loans''
and inserting ``to approve, authorize, close, service,
foreclose, litigate (except that the Administration may
monitor the conduct of any such litigation to which a premier
certified lender is a party), and liquidate loans'';
(5) in subsection (f), by striking ``State or local'' and
inserting ``certified'';
(6) in subsection (g), by striking the subsection heading
and inserting the following:
``(g) Effect of Suspension or Revocation.--'';
(7) by striking subsection (h) and inserting the following:
``(h) Program Goals.--Each certified development company
participating in the program under this section shall
establish a goal of processing a minimum of not less than 50
percent of the loan applications for assistance under section
504 pursuant to the program authorized under this section.'';
and
(8) in subsection (i), by striking ``other lenders'' and
inserting ``other lenders, specifically comparing default
rates and recovery rates on liquidations''.
(b) Regulations.--The Administrator shall--
(1) not later than 150 days after the date of enactment of
this Act, promulgate regulations to carry out the amendments
made by subsection (a); and
(2) not later than 180 days after the date of enactment of
this Act, issue program guidelines and fully implement the
amendments made by subsection (a).
(c) Program Extension.--Section 217(b) of the Small
Business Reauthorization and Amendments Act of 1994 (15
U.S.C. 697e note) is amended by striking ``October 1, 1997''
and inserting ``October 1, 2000''.
Subtitle D--Miscellaneous Provisions
SEC. 231. BACKGROUND CHECK OF LOAN APPLICANTS.
Section 7(a) of the Small Business Act (15 U.S.C. 636(a))
is amended--
(1) by striking ``(a) The Administration'' and inserting
the following:
[[Page H10490]]
``(a) Loans to Small Business Concerns; Allowable Purposes;
Qualified Business; Restrictions and Limitations.--The
Administration''; and
(2) in paragraph (1)--
(A) by striking ``(1) No financial'' and inserting the
following:
``(1) In general.--
``(A) Credit elsewhere.--No financial''; and
(B) by adding at the end the following:
``(B) Background checks.--Prior to the approval of any loan
made pursuant to this subsection, or section 503 of the Small
Business Investment Act of 1958, the Administrator may 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. 232. REPORT ON INCREASED LENDER APPROVAL, SERVICING,
FORECLOSURE, LIQUIDATION, AND LITIGATION OF
SECTION 7(A) LOANS.
(a) In General.--
(1) Submission.--Not later than 6 months after the date of
enactment of this Act, the Administrator shall submit to the
Committees a 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.
(2) Contents.--The report under this subsection shall
address administrative and other steps necessary to achieve
the results described in paragraph (1), including--
(A) streamlining the process for approving lenders and
standardizing requirements;
(B) establishing uniform reporting requirements using on-
line automated capabilities to the maximum extent feasible;
(C) reducing paperwork through automation, simplified
forms, or incorporation of lender's forms;
(D) providing uniform standards for approval, closing,
servicing, foreclosure, and liquidation;
(E) promulgating new regulations or amending existing ones;
(F) establishing a timetable for implementing the plan for
reliance on private sector lenders;
(G) implementing organizational changes at SBA; and
(H) estimating the annual savings that would occur as a
result of implementation.
(b) Consultation.--In preparing the report under subsection
(a), the Administrator shall consult with, among others--
(1) borrowers and lenders under section 7(a) of the Small
Business Act;
(2) small businesses that are potential program
participants under section 7(a) of the Small Business Act;
(3) financial institutions that are potential program
lenders under section 7(a) of the Small Business Act; and
(4) representative industry associations.
SEC. 233. COMPLETION OF PLANNING FOR LOAN MONITORING SYSTEM.
(a) In General.--The Administrator shall perform and
complete the planning needed to serve as the basis for
funding the development and implementation of the
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) Report.--
(1) In general.--On the date that is 6 months after the
date of enactment of this Act, the Administrator shall submit
a report on the progress of the Administrator in carrying out
subsection (a) to--
(A) the Committees; and
(B) the Comptroller General of the United States.
(2) Evaluation.--Not later than 28 days after receipt of
the report under paragraph (1)(B), the Comptroller General of
the United States shall--
(A) prepare a written evaluation of the report for
compliance with subsection (a); and
(B) submit the evaluation to the Committees.
(3) Limitation.--None of the funds provided for the
purchase of the loan monitoring system may be obligated or
expended until 45 days after the date on which the Committees
and the Comptroller General of the United States receive the
report under paragraph (1).
TITLE III--WOMEN'S BUSINESS ENTERPRISES
SEC. 301. INTERAGENCY COMMITTEE PARTICIPATION.
Section 403 of the Women's Business Ownership Act of 1988
(15 U.S.C. 631 note) is amended--
(1) in subsection (a)(2)(A)--
(A) by striking ``and Amendments Act of 1994'' and
inserting ``Act of 1997''; and
(B) by inserting before the final period ``, and who shall
report directly to the head of the agency on the status of
the activities of the Interagency Committee'';
(2) in subsection (a)(2)(B), by inserting before the final
period the following: ``and shall report directly to the
Administrator on the status of the activities on the
Interagency Committee and shall serve as the Interagency
Committee Liaison to the National Women's Business Council
established under section 405''; and
(3) in subsection (b), by striking ``and Amendments Act of
1994'' and inserting ``Act of 1997''.
SEC. 302. REPORTS.
Section 404 of the Women's Business Ownership Act of 1988
(15 U.S.C. 631 note) is amended--
(1) by inserting ``, through the Small Business
Administration,'' after ``transmit'';
(2) by striking paragraph (1) and redesignating paragraphs
(2) through (4) as paragraphs (1) through (3), respectively;
and
(3) in paragraph (1), as redesignated, by inserting before
the semicolon the following: ``, including a verbatim report
on the status of progress of the Interagency Committee in
meeting its responsibilities and duties under section
402(a)''.
SEC. 303. COUNCIL DUTIES.
Section 406 of the Women's Business Ownership Act of 1988
(15 U.S.C. 631 note) is amended--
(1) in subsection (c), by inserting after ``Administrator''
the following: ``(through the Assistant Administrator of the
Office of Women's Business Ownership)''; and
(2) in subsection (d)--
(A) in paragraph (4), by striking ``and'' at the end;
(B) in paragraph (5), by striking the period at the end and
inserting a semicolon; and
(C) by adding at the end the following:
``(6) not later than 90 days after the last day of each
fiscal year, 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, a 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) Form of Transmittal.--The information included in
each report under subsection (d) that is described in
subparagraphs (A) through (C) of subsection (d)(6), shall be
reported verbatim, together with any separate additional,
concurring, or dissenting views of the Administrator.''.
SEC. 304. COUNCIL MEMBERSHIP.
Section 407 of the Women's Business Ownership Act of 1988
(15 U.S.C. 631 note) is amended--
(1) in subsection (a), by striking ``and Amendments Act of
1994'' and inserting ``Act of 1997'';
(2) in subsection (b)--
(A) by striking ``and Amendments Act of 1994'' and
inserting ``Act of 1997'';
(B) by inserting after ``the Administrator shall'' the
following: ``, after receiving the recommendations of the
Chairman and the Ranking Member 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), by striking ``2'' and inserting
``4''; and
(F) in paragraph (3)--
(i) by striking ``5'' and inserting ``6'';
(ii) by striking ``national''; and
(iii) by inserting ``, including representatives of women's
business center sites'' before the period at the end;
(3) in subsection (c), by inserting ``(including both urban
and rural areas)'' after ``geographic'';
(4) by striking subsection (d) and inserting the following:
``(d) Terms.--Each member of the Council shall be appointed
for a term of 3 years, except that, of the initial members
appointed to the Council--
``(1) 2 members appointed under subsection (b)(1) shall be
appointed for a term of 1 year;
``(2) 2 members appointed under subsection (b)(2) shall be
appointed for a term of 1 year; and
``(3) each member appointed under subsection (b)(3) shall
be appointed for a term of 2 years.''; and
(5) by striking subsection (f) and inserting the following:
``(f) Vacancies.--
``(1) In general.--A vacancy on the Council shall be filled
not later than 30 days after the date on which the vacancy
occurs, in the manner in which the original appointment was
made, and shall be subject to any conditions that applied to
the original appointment.
``(2) Unexpired term.--An individual chosen to fill a
vacancy shall be appointed for the unexpired term of the
member replaced.''.
SEC. 305. AUTHORIZATION OF APPROPRIATIONS.
Section 409 of the Women's Business Ownership Act of 1988
(15 U.S.C. 631 note) is amended to read as follows:
``SEC. 411. AUTHORIZATION OF APPROPRIATIONS.
``(a) In General.--There is authorized to be appropriated
to carry out this title $600,000, for each of fiscal years
1998 through 2000, of which $200,000 shall be available in
each fiscal year to carry out sections 409 and 410.
``(b) Budget Review.--No amount made available under this
section for any fiscal year may be obligated or expended by
the Council before the date on which the Council reviews and
approves the operating budget of the Council to carry out the
responsibilities of the Council for that fiscal year.''.
[[Page H10491]]
SEC. 306. NATIONAL WOMEN'S BUSINESS COUNCIL PROCUREMENT
PROJECT.
The Women's Business Ownership Act of 1988 (15 U.S.C. 631
note) is amended by inserting after section 408 the
following:
``SEC. 409. NATIONAL WOMEN'S BUSINESS COUNCIL PROCUREMENT
PROJECT.
``(a) Federal Procurement Study.--
``(1) In general.--During the first fiscal year for which
amounts are made available to carry out this section, the
Council shall conduct a study on the award of Federal prime
contracts and subcontracts to women-owned businesses, which
study shall include--
``(A) an analysis of data collected by Federal agencies on
contract awards to women-owned businesses;
``(B) a determination of the degree to which individual
Federal agencies are in compliance with the 5 percent women-
owned business procurement goal established by section
15(g)(1) of the Small Business Act (15 U.S.C. 644(g)(1));
``(C) a determination of the types and amounts of Federal
contracts characteristically awarded to women-owned
businesses; and
``(D) other relevant information relating to participation
of women-owned businesses in Federal procurement.
``(2) Submission of results.--Not later than 12 months
after initiating the study under paragraph (1), the Council
shall submit to the Committees on Small Business of the House
of Representatives and the Senate, and to the President, the
results of the study conducted under paragraph (1).
``(b) Best Practices Report.--Not later than 18 months
after initiating the study under subsection (a)(1), the
Council shall submit to the Committees on Small Business of
the House of Representatives and the Senate, and to the
President, a report, which shall include--
``(1) an analysis of the most successful practices in
attracting women-owned businesses as prime contractors and
subcontractors by--
``(A) Federal agencies (as supported by findings from the
study required under subsection (a)(1)) in Federal
procurement awards; and
``(B) the private sector; and
``(2) recommendations for policy changes in Federal
procurement practices, including an increase in the Federal
procurement goal for women-owned businesses, in order to
maximize the number of women-owned businesses performing
Federal contracts.
``(c) Contract Authority.--In conducting any study or other
research under this section, the Council may contract with 1
or more public or private entities.''.
SEC. 307. STUDIES AND OTHER RESEARCH.
The Women's Business Ownership Act of 1988 (15 U.S.C. 631
note) is amended by inserting after section 409 (as added by
section 306 of this title) the following:
``SEC. 410. STUDIES AND OTHER RESEARCH.
``(a) In General.--To the extent that it does not delay
submission of the report under section 409(b), the Council
may also conduct such studies and other research relating to
the award of Federal prime contracts and subcontracts to
women-owned businesses, or to issues relating to access to
credit and investment capital by women entrepreneurs, as the
Council determines to be appropriate.
``(b) Contract Authority.--In conducting any study or other
research under this section, the Council may contract with 1
or more public or private entities.''.
SEC. 308. 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 CENTER PROGRAM.
``(a) Definitions.--In this section--
``(1) the term `Assistant Administrator' means the
Assistant Administrator of the Office of Women's Business
Ownership established under subsection (g);
``(2) the term `small business concern owned and controlled
by women', either startup or existing, includes any small
business concern--
``(A) that is not less than 51 percent owned by 1 or more
women; and
``(B) the management and daily business operations of which
are controlled by 1 or more women; and
``(3) the term `women's business center site' means the
location of--
``(A) a women's business center; or
``(B) 1 or more women's business centers, established in
conjunction with another women's business center in another
location within a State or region--
``(i) that reach a distinct population that would otherwise
not be served;
``(ii) whose services are targeted to women; and
``(iii) whose scope, function, and activities are similar
to those of the primary women's business center or centers in
conjunction with which it was established.
``(b) Authority.--The Administration may provide financial
assistance to private organizations to conduct 5-year
projects for the benefit of small business concerns owned and
controlled by women. The projects shall provide--
``(1) financial assistance, including training and
counseling in how to apply for and secure business credit and
investment capital, preparing and presenting financial
statements, and managing cash flow and other financial
operations of a business concern;
``(2) management assistance, including training and
counseling in how to plan, organize, staff, direct, and
control each major activity and function of a small business
concern; and
``(3) marketing assistance, including training and
counseling in identifying and segmenting domestic and
international market opportunities, preparing and executing
marketing plans, developing pricing strategies, locating
contract opportunities, negotiating contracts, and utilizing
varying public relations and advertising techniques.
``(c) Conditions of Participation.--
``(1) Non-federal contributions.--As a condition of
receiving financial assistance authorized by this section,
the recipient organization shall agree to obtain, after its
application has been approved and notice of award has been
issued, cash contributions from non-Federal sources as
follows:
``(A) in the first and second years, 1 non-Federal dollar
for each 2 Federal dollars;
``(B) in the third and fourth years, 1 non-Federal dollar
for each Federal dollar; and
``(C) in the fifth year, 2 non-Federal dollars for each
Federal dollar.
``(2) Form of non-federal contributions.--Not more than
one-half of the non-Federal sector matching assistance may be
in the form of in-kind contributions that are budget line
items only, including 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 non-federal funding.--If any
recipient of assistance fails to obtain the required non-
Federal contribution during any project, it shall not be
eligible thereafter for advance disbursements pursuant to
paragraph (3) during the remainder of that project, or for
any other project for which it is or may be funded by the
Administration, and prior to approving assistance to such
organization for any other projects, the Administration shall
specifically determine whether the Administration believes
that the recipient will be able to obtain the requisite non-
Federal funding and enter a written finding setting forth the
reasons for making such determination.
``(d) Contract Authority.--A women's business center may
enter into a contract with a Federal department or agency to
provide specific assistance to women and other underserved
small business concerns. Performance of such contract should
not hinder the women's business centers in carrying out the
terms of the grant received by the women's business centers
from the Administration.
``(e) Submission of 5-Year Plan.--Each applicant
organization initially shall submit a 5-year plan to the
Administration on proposed fundraising and training
activities, and a recipient organization may receive
financial assistance under this program for a maximum of 5
years per women's business center site.
``(f) Criteria.--The Administration shall evaluate and rank
applicants in accordance with predetermined selection
criteria that shall be stated in terms of relative
importance. Such criteria and their relative importance shall
be made publicly available and stated in each solicitation
for applications made by the Administration. The criteria
shall include--
``(1) the experience of the applicant in conducting
programs or ongoing efforts designed to impart or upgrade the
business skills of women business owners or potential owners;
``(2) the present ability of the applicant to commence a
project within a minimum amount of time;
``(3) the ability of the applicant to provide training and
services to a representative number of women who are both
socially and economically disadvantaged; and
``(4) the location for the women's business center site
proposed by the applicant.
``(g) Office of Women's Business Ownership.--
``(1) Establishment.--There is established within the
Administration an Office of Women's Business Ownership, which
shall be responsible for the administration of the
Administration's programs for the development of women's
business enterprises (as defined in section 408 of the
Women's Business Ownership Act of 1988 (15 U.S.C. 631 note)).
The Office of Women's Business Ownership shall be
administered by an Assistant Administrator, who shall be
appointed by the Administrator.
``(2) Assistant administrator of the office of women's
business ownership.--
``(A) Qualification.--The position of Assistant
Administrator shall be a Senior Executive Service position
under section 3132(a)(2) of title 5, United States Code. The
Assistant Administrator shall serve as a noncareer appointee
(as defined in section 3132(a)(7) of that title).
``(B) Responsibilities and duties.--
``(i) 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.
``(ii) Duties.--The Assistant Administrator shall--
``(I) administer and manage the Women's Business Center
program;
``(II) recommend the annual administrative and program
budgets for the Office of Women's Business Ownership
(including the budget for the Women's Business Center
program);
``(III) establish appropriate funding levels therefore;
``(IV) review the annual budgets submitted by each
applicant for the Women's Business Center program;
[[Page H10492]]
``(V) select applicants to participate in the program under
this section;
``(VI) implement this section;
``(VII) maintain a clearinghouse to provide for the
dissemination and exchange of information between women's
business centers;
``(VIII) serve as the vice chairperson of the Interagency
Committee on Women's Business Enterprise;
``(IX) serve as liaison for the National Women's Business
Council; and
``(X) advise the Administrator on appointments to the
Women's Business Council.
``(C) Consultation requirements.--In carrying out the
responsibilities and duties described in this paragraph, the
Assistant Administrator shall confer with and seek the advice
of the Administration officials in areas served by the
women's business centers.
``(h) Program Examination.--
``(1) In general.--Not later than 180 days after the date
of enactment of the Small Business Reauthorization Act of
1997, the Administrator 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 Administrator
shall consider the results of the examination conducted under
paragraph (1).
``(i) Contract Authority.--The authority of the
Administrator 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
Administrator has entered into 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 Administrator provides
the applicant with written notification setting forth the
reasons therefore and affords the applicant an opportunity
for a hearing, appeal, or other administrative proceeding
under chapter 5 of title 5, United States Code.
``(j) 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.
``(k) Authorization of Appropriations.--
``(1) In general.--There is authorized to be appropriated
$8,000,000 for each fiscal year to carry out the projects
authorized under this section, of which, for fiscal year
1998, not more than 5 percent may be used for administrative
expenses related to the program under this section.
``(2) Use of amounts.--Amounts made available under this
subsection for fiscal year 1999, and each fiscal year
thereafter, may only be used for grant awards and may not be
used for costs incurred by the Administration in connection
with the management and administration of the program under
this section.
``(3) Expedited acquisition.--Notwithstanding any other
provision of law, the Administrator, acting through the
Assistant Administrator, may use such expedited acquisition
methods as the Administrator determines to be appropriate to
carry out this section, except that the Administrator shall
ensure that all small business sources are provided a
reasonable opportunity to submit proposals.''.
(b) Applicability.--
(1) In general.--Subject to paragraph (2), any organization
conducting a 3-year project under section 29 of the Small
Business Act (15 U.S.C. 656) (as in effect on the day before
the effective date of this Act) on September 30, 1997, may
request an extension of the term of that project to a total
term of 5 years. If such an extension is made, the
organization shall receive financial assistance in accordance
with section 29(c) of the Small Business Act (as amended by
this section) subject to procedures established by the
Administrator, in coordination with the Assistant
Administrator of 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 section).
(2) Terms of assistance for certain organizations.--Any
organization operating in the third year of a 3-year project
under section 29 of the Small Business Act (15 U.S.C. 656)
(as in effect on the day before the effective date of this
Act) on September 30, 1997, may request an extension of the
term of that project to a total term of 5 years. If such an
extension is made, during the fourth and fifth years of the
project, the organization shall receive financial assistance
in accordance with section 29(c)(1)(C) of the Small Business
Act (as amended by this section) subject to procedures
established by the Administrator, in coordination with the
Assistant Administrator of 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 section).
TITLE IV--COMPETITIVENESS PROGRAM AND PROCUREMENT OPPORTUNITIES
Subtitle A--Small Business Competitiveness Program
SEC. 401. PROGRAM TERM.
Section 711(c) of the Small Business Competitiveness
Demonstration Program Act of 1988 (15 U.S.C. 644 note) is
amended by striking ``, 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. REPORTS TO CONGRESS.
Section 716(a) of the Small Business Competitiveness
Demonstration Program Act of 1988 (15 U.S.C. 644 note) is
amended--
(1) by striking ``1996'' and inserting ``2000'';
(2) by striking ``for Federal Procurement Policy'' and
inserting ``of the Small Business Administration''; and
(3) by striking ``Government Operations'' and inserting
``Government Reform and Oversight''.
SEC. 404. SMALL BUSINESS PARTICIPATION IN DREDGING.
Section 722(a) of the Small Business Competitiveness
Demonstration Program Act of 1988 (15 U.S.C. 644 note) is
amended by striking ``and terminating on September 30,
1997''.
SEC. 405. TECHNICAL AMENDMENTS.
Section 717 of the Small Business Competitiveness
Demonstration Program Act of 1988 (15 U.S.C. 644 note) is
amended--
(1) by inserting ``or North American Industrial
Classification Code'' after ``standard industrial
classification code'' each place it appears; and
(2) by inserting ``or North American Industrial
Classification Codes'' after ``standard industrial
classification codes'' each place it appears.
Subtitle B--Small Business Procurement Opportunities Program
SEC. 411. CONTRACT BUNDLING.
Section 2 of the Small Business Act (15 U.S.C. 631) is
amended by adding at the end the following:
``(j) Contract Bundling.--In complying with the statement
of congressional policy expressed in subsection (a), relating
to fostering the participation of small business concerns in
the contracting opportunities of the Government, each Federal
agency, to the maximum extent practicable, shall--
``(1) comply with congressional intent to foster the
participation of small business concerns as prime
contractors, subcontractors, and suppliers;
``(2) structure its contracting requirements to facilitate
competition by and among small business concerns, taking all
reasonable steps to eliminate obstacles to their
participation; and
``(3) avoid unnecessary and unjustified bundling of
contract requirements that precludes small business
participation in procurements as prime contractors.''.
SEC. 412. DEFINITION OF CONTRACT BUNDLING.
Section 3 of the Small Business Act (15 U.S.C. 632) is
amended by adding at the end the following:
``(o) Definitions of Bundling of Contract Requirements and
Related Terms.--In this Act:
``(1) Bundled contract.--The term `bundled contract' means
a contract that is entered into to meet requirements that are
consolidated in a bundling of contract requirements.
``(2) Bundling of contract requirements.--The term
`bundling of contract requirements' means consolidating 2 or
more procurement requirements for goods or services
previously provided or performed under separate smaller
contracts into a solicitation of offers for a single contract
that is likely to be unsuitable for award to a small-business
concern due to--
``(A) the diversity, size, or specialized nature of the
elements of the performance specified;
``(B) the aggregate dollar value of the anticipated award;
``(C) the geographical dispersion of the contract
performance sites; or
``(D) any combination of the factors described in
subparagraphs (A), (B), and (C).
``(3) Separate smaller contract.--The term `separate
smaller contract', with respect to a bundling of contract
requirements, means a contract that has been performed by 1
or more small business concerns or was suitable for award to
1 or more small business concerns.''.
SEC. 413. ASSESSING PROPOSED CONTRACT BUNDLING.
(a) In General.--Section 15 of the Small Business Act (15
U.S.C. 644) is amended by inserting after subsection (d) the
following:
``(e) Procurement Strategies; Contract Bundling.--
``(1) In general.--To the maximum extent practicable,
procurement strategies used by the various agencies having
contracting authority shall facilitate the maximum
participation of small business concerns as prime
contractors, subcontractors, and suppliers.
``(2) Market research.--
``(A) In general.--Before proceeding with an acquisition
strategy that could lead to a contract containing
consolidated procurement requirements, the head of an agency
shall conduct market research to determine whether
consolidation of the requirements is necessary and justified.
``(B) Factors.--For purposes of subparagraph (A),
consolidation of the requirements may be determined as being
necessary and justified if, as compared to the benefits that
would be derived from contracting to meet those requirements
if not consolidated, the Federal Government would derive from
the consolidation measurably substantial benefits, including
any combination of benefits that, in combination, are
measurably substantial. Benefits described in the preceding
sentence may include the following:
``(i) Cost savings.
``(ii) Quality improvements.
[[Page H10493]]
``(iii) Reduction in acquisition cycle times.
``(iv) Better terms and conditions.
``(v) Any other benefits.
``(C) Reduction of costs not determinative.--The reduction
of administrative or personnel costs alone shall not be a
justification for bundling of contract requirements unless
the cost savings are expected to be substantial in relation
to the dollar value of the procurement requirements to be
consolidated.
``(3) Strategy specifications.--If the head of a
contracting agency determines that a proposed procurement
strategy for a procurement involves a substantial bundling of
contract requirements, the proposed procurement strategy
shall--
``(A) identify specifically the benefits anticipated to be
derived from the bundling of contract requirements;
``(B) set forth an assessment of the specific impediments
to participation by small business concerns as prime
contractors that result from the bundling of contract
requirements and specify actions designed to maximize small
business participation as subcontractors (including
suppliers) at various tiers under the contract or contracts
that are awarded to meet the requirements; and
``(C) include a specific determination that the anticipated
benefits of the proposed bundled contract justify its use.
``(4) Contract teaming.--In the case of a solicitation of
offers for a bundled contract that is issued by the head of
an agency, a small-business concern may submit an offer that
provides for use of a particular team of subcontractors for
the performance of the contract. The head of the agency shall
evaluate the offer in the same manner as other offers, with
due consideration to the capabilities of all of the proposed
subcontractors. If a small business concern teams under this
paragraph, it shall not affect its status as a small business
concern for any other purpose.''.
(b) Administration Review.--Section 15(a) of the Small
Business Act (15 U.S.C. 644(a)) is amended in the third
sentence--
(1) by inserting ``or the solicitation involves an
unnecessary or unjustified bundling of contract requirements,
as determined by the Administration,'' after ``discrete
construction projects,'';
(2) by striking ``or (4)'' and inserting ``(4)''; and
(3) by inserting before the period at the end of the
sentence the following: ``, or (5) why the agency has
determined that the bundled contract (as defined in section
3(o)) is necessary and justified''.
(c) Responsibilities of Agency Small Business Advocates.--
Section 15(k) of the Small Business Act (15 U.S.C. 644(k)) is
amended--
(1) by redesignating paragraphs (5) through (9) as
paragraphs (6) through (10), respectively; and
(2) by inserting after paragraph (4) the following:
``(5) identify proposed solicitations that involve
significant bundling of contract requirements, and work with
the agency acquisition officials and the Administration to
revise the procurement strategies for such proposed
solicitations where appropriate to increase the probability
of participation by small businesses as prime contractors, or
to facilitate small business participation as subcontractors
and suppliers, if a solicitation for a bundled contract is to
be issued;''.
SEC. 414. REPORTING OF BUNDLED CONTRACT OPPORTUNITIES.
(a) Data Collection Required.--The Federal Procurement Data
System described in section 6(d)(4)(A) of the Office of
Federal Procurement Policy Act (41 U.S.C. 405(d)(4)(A)) shall
be modified to collect data regarding bundling of contract
requirements when the contracting officer anticipates that
the resulting contract price, including all options, is
expected to exceed $5,000,000. The data shall reflect a
determination made by the contracting officer regarding
whether a particular solicitation constitutes a contract
bundling.
(b) Definitions.--In this section, the term ``bundling of
contract requirements'' has the meaning given that term in
section 3(o) of the Small Business Act (15 U.S.C. 632(o)) (as
added by section 412 of this subtitle).
SEC. 415. EVALUATING SUBCONTRACT PARTICIPATION IN AWARDING
CONTRACTS.
Section 8(d)(4) of the Small Business Act (15 U.S.C.
637(d)(4)) is amended by adding at the end the following:
``(G) The following factors shall be designated by the
Federal agency as significant factors for purposes of
evaluating offers for a bundled contract where the head of
the agency determines that the contract offers a significant
opportunity for subcontracting:
``(i) A factor that is based on the rate provided under the
subcontracting plan for small business participation in the
performance of the contract.
``(ii) For the evaluation of past performance of an
offeror, a factor that is based on the extent to which the
offeror attained applicable goals for small business
participation in the performance of contracts.''.
SEC. 416. IMPROVED NOTICE OF SUBCONTRACTING OPPORTUNITIES.
(a) Use of the Commerce Business Daily Authorized.--Section
8 of the Small Business Act (15 U.S.C. 637) is amended by
adding at the end the following:
``(k) Notices of Subcontracting Opportunities.--
``(1) In general.--Notices of subcontracting opportunities
may be submitted for publication in the Commerce Business
Daily by--
``(A) a business concern awarded a contract by an executive
agency subject to subsection (e)(1)(C); and
``(B) a business concern that is a subcontractor or
supplier (at any tier) to such contractor having a
subcontracting opportunity in excess of $10,000.
``(2) Content of notice.--The notice of a subcontracting
opportunity shall include--
``(A) a description of the business opportunity that is
comparable to the description specified in paragraphs (1),
(2), (3), and (4) of subsection (f); and
``(B) the due date for receipt of offers.''.
(b) Regulations Required.--The Federal Acquisition
Regulation shall be amended to provide uniform implementation
of the amendments made by this section.
(c) Conforming Amendment.--Section 8(e)(1)(C) of the Small
Business Act (15 U.S.C. 637(e)(1)(C)) is amended by striking
``$25,000'' each place that term appears and inserting
``$100,000''.
SEC. 417. DEADLINES FOR ISSUANCE OF REGULATIONS.
(a) Proposed Regulations.--Proposed amendments to the
Federal Acquisition Regulation or proposed Small Business
Administration regulations under this subtitle and the
amendments made by this subtitle shall be published not later
than 120 days after the date of enactment of this Act for the
purpose of obtaining public comment pursuant to section 22 of
the Office of Federal Procurement Policy Act (41 U.S.C.
418b), or chapter 5 of title 5, United States Code, as
appropriate. The public shall be afforded not less than 60
days to submit comments.
(b) Final Regulations.--Final regulations shall be
published not later than 270 days after the date of enactment
of this Act. The effective date for such final regulations
shall be not less than 30 days after the date of publication.
TITLE V--MISCELLANEOUS PROVISIONS
SEC. 501. SMALL BUSINESS TECHNOLOGY TRANSFER PROGRAM.
(a) Required Expenditures.--Section 9(n) of the Small
Business Act (15 U.S.C. 638(n)) is amended by striking
paragraph (1) and inserting the following:
``(1) Required expenditure amounts.--With respect to fiscal
years 1998, 1999, 2000, and 2001, each Federal agency that
has an extramural budget for research, or research and
development, in excess of $1,000,000,000 for that fiscal
year, is authorized to expend with small business concerns
not less than 0.15 percent of that extramural budget
specifically in connection with STTR programs that meet the
requirements of this section and any policy directives and
regulations issued under this section.''.
(b) Reports and Outreach.--
(1) In general.--Section 9 of the Small Business Act (15
U.S.C. 638) is amended--
(A) in subsection (o)--
(i) by redesignating paragraphs (8) through (11) as
paragraphs (10) through (13), respectively; and
(ii) by inserting after paragraph (7) the following:
``(8) include, as part of its annual performance plan as
required by subsections (a) and (b) of section 1115 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;'';
(B) in subsection (e)(4)(A), by striking ``(ii)''; and
(C) by adding at the end the following:
``(s) Outreach.--
``(1) Definition of eligible state.--In this subsection,
the term `eligible State' means a State--
``(A) if the total value of contracts awarded to the State
during fiscal year 1995 under this section was less than
$5,000,000; and
``(B) that certifies to the Administration described in
paragraph (2) that the State will, upon receipt of assistance
under this subsection, provide matching funds from non-
Federal sources in an amount that is not less than 50 percent
of the amount provided under this subsection.
``(2) Program authority.--Of amounts made available to
carry out this section for fiscal year 1998, 1999, 2000, or
2001 the Administrator may expend with eligible States not
more than $2,000,000 in each such fiscal year in order to
increase the participation of small business concerns located
in those States in the programs under this section.
``(3) Amount of assistance.--The amount of assistance
provided to an eligible State under this subsection in any
fiscal year--
``(A) shall be equal to twice the total amount of matching
funds from non-Federal sources provided by the State; and
``(B) shall not exceed $100,000.
``(4) Use of assistance.--Assistance provided to an
eligible State under this subsection shall be used by the
State, in consultation with State and local departments and
agencies, for programs and activities to increase the
participation of small business concerns located in the State
in the programs under this section, including--
``(A) the establishment of quantifiable performance goals,
including goals relating to--
``(i) the number of program awards under this section made
to small business concerns in the State; and
``(ii) the total amount of Federal research and development
contracts awarded to small business concerns in the State;
``(B) the provision of competition outreach support to
small business concerns in the State that are involved in
research and development; and
``(C) the development and dissemination of educational and
promotional information relating to the programs under this
section to small business concerns in the State.
[[Page H10494]]
``(t) Inclusion in Strategic Plans.--Program information
relating to the SBIR and STTR programs shall be included by
each Federal agency in any update or revision required of the
Federal agency under section 306(b) of title 5, United States
Code.''.
(2) Repeal.--Effective October 1, 2001, section 9(s) of the
Small Business Act (as added by paragraph (1) of this
subsection) is repealed.
SEC. 502. SMALL BUSINESS DEVELOPMENT CENTERS.
(a) In General.--Section 21(a) of the Small Business Act
(15 U.S.C. 648(a)) is amended--
(1) in paragraph (1)--
(A) by inserting ``any women's business center operating
pursuant to section 29,'' after ``credit or finance
corporation,'';
(B) by inserting ``or a women's business center operating
pursuant to section 29'' after ``other than an institution of
higher education''; and
(C) by inserting ``and women's business centers operating
pursuant to section 29'' after ``utilize institutions of
higher education'';
(2) in paragraph (3)--
(A) by striking ``, but with'' and all that follows through
``parties.'' and inserting the following: ``for the delivery
of programs and services to the small business community.
Such programs and services shall be jointly developed,
negotiated, and agreed upon, with full participation of both
parties, pursuant to an executed cooperative agreement
between the Small Business Development Center applicant and
the Administration.''; and
(B) by adding at the end the following:
``(C) On an annual basis, the Small Business Development
Center shall review and coordinate public and private
partnerships and cosponsorships with the Administration for
the purpose of more efficiently leveraging available
resources on a National and a State basis.'';
(3) in paragraph (4)(C)--
(A) by striking clause (i) and inserting the following:
``(i) In general.--
``(I) Grant amount.--Subject to subclauses (II) and (III),
the amount of a grant received by a State under this section
shall be equal to the greater of $500,000, or the sum of--
``(aa) the State's pro rata share of the national program,
based upon the population of the State as compared to the
total population of the United States; and
``(bb) $300,000 in fiscal year 1998, $400,000 in fiscal
year 1999, and $500,000 in each fiscal year thereafter.
``(II) Pro rata reductions.--If the amount made available
to carry out this section for any fiscal year is insufficient
to carry out subclause (I)(bb), the Administration shall make
pro rata reductions in the amounts otherwise payable to
States under subclause (I)(bb).
``(III) Matching requirement.--The amount of a grant
received by a State under this section shall not exceed the
amount of matching funds from sources other than the Federal
Government provided by the State under subparagraph (A).'';
and
(B) in clause (iii), by striking ``(iii)'' and all that
follows through ``1997.'' and inserting the following:
``(iii) National program.--There are authorized to be
appropriated to carry out the national program under this
section--
``(I) $85,000,000 for fiscal year 1998;
``(II) $90,000,000 for fiscal year 1999; and
``(III) $95,000,000 for fiscal year 2000 and each fiscal
year thereafter.''; and
(4) in paragraph (6)--
(A) in subparagraph (A), by striking ``and'' at the end;
(B) in subparagraph (B), by striking the comma at the end
and inserting ``; and''; and
(C) inserting after subparagraph (B) the following:
``(C) with outreach, development, and enhancement of
minority-owned small business startups or expansions, HUBZone
small business concerns, veteran-owned small business
startups or expansions, and women-owned small business
startups or expansions, in communities impacted by base
closings or military or corporate downsizing, or in rural or
underserved communities;''.
(b) SBDC Services.--Section 21(c) of the Small Business Act
(15 U.S.C. 648(c)) is amended--
(1) in paragraph (3)--
(A) in subparagraph (A), by striking ``businesses;'' and
inserting ``businesses, including--
``(i) working with individuals to increase awareness of
basic credit practices and credit requirements;
``(ii) working with individuals to development business
plans, financial packages, credit applications, and contract
proposals;
``(iii) working with the Administration to develop and
provide informational tools for use in working with
individuals on pre-business startup planning, existing
business expansion, and export planning; and
``(iv) working with individuals referred by the local
offices of the Administration and Administration
participating lenders;'';
(B) in each of subparagraphs (B), (C), (D), (E), (F), (G),
(M), (N), (O), (Q), and (R) by moving each margin 2 ems to
the left; and
(C) in subparagraph (C), by inserting ``and the
Administration'' after ``Center'';
(2) in paragraph (5)--
(A) by moving the margin 2 ems to the right;
(B) by striking ``paragraph (a)(1)'' and inserting
``subsection (a)(1)'';
(C) by striking ``which ever'' and inserting ``whichever'';
and
(D) by striking ``last,,'' and inserting ``last,'';
(3) by redesignating paragraphs (4) through (7) as
paragraphs (5) through (8), respectively; and
(4) in paragraph (3), in the undesignated material
following subparagraph (R), 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 or cooperative agreement
under this section with an entity that is covered by this
section is not renewed or extended, any award of a successor
contract or cooperative agreement under this section to
another entity shall be made on a competitive basis.''.
(d) Prohibition on Certain Fees.--Section 21 of the Small
Business Act (15 U.S.C. 648) is amended by adding at the end
the following:
``(m) Prohibition on Certain Fees.--A small business
development center shall not impose or otherwise collect a
fee or other compensation in connection with the provision of
counseling services under this section.''.
SEC. 503. PILOT PREFERRED SURETY BOND GUARANTEE PROGRAM
EXTENSION.
Section 207 of the Small Business Administration
Reauthorization and Amendment Act of 1988 (15 U.S.C. 694b
note) is amended by striking ``September 30, 1997'' and
inserting ``September 30, 2000''.
SEC. 504. EXTENSION OF COSPONSORSHIP AUTHORITY.
Section 401(a)(2) of the Small Business Administration
Reauthorization and Amendments Act of 1994 (15 U.S.C. 637
note) is amended by striking ``September 30, 1997'' and
inserting ``September 30, 2000''.
SEC. 505. ASSET SALES.
In connection with the Administration's implementation of a
program to sell to the private sector loans and other assets
held by the Administration, the Administration shall provide
to the Committees a copy of the draft and final plans
describing the sale and the anticipated benefits resulting
from such sale.
SEC. 506. SMALL BUSINESS EXPORT PROMOTION.
(a) In General.--Section 21(c)(3) of the Small Business Act
(15 U.S.C. 648(c)(3)) is amended--
(1) in subparagraph (Q), by striking ``and'' at the end;
(2) in subparagraph (R), by striking the period at the end
and inserting ``; and''; and
(3) by inserting after subparagraph (R) the following:
``(S) providing small business owners with access to a wide
variety of export-related information by establishing on-line
computer linkages between small business development centers
and an international trade data information network with ties
to the Export Assistance Center program.''.
(b) Authorization of Appropriations.--There is authorized
to be appropriated to carry out section 21(c)(3)(S) of the
Small Business Act (15 U.S.C. 648(c)(3)(S)), as added by this
section, $1,500,000 for each fiscal years 1998 and 1999.
SEC. 507. DEFENSE LOAN AND TECHNICAL ASSISTANCE PROGRAM.
(a) DELTA Program Authorized.--
(1) In general.--The Administrator may administer the
Defense Loan and Technical Assistance program in accordance
with the authority and requirements of this section.
(2) Expiration of authority.--The authority of the
Administrator to carry out the DELTA program under paragraph
(1) shall terminate when the funds referred to in subsection
(g)(1) have been expended.
(3) DELTA program defined.--In this section, the terms
``Defense Loan and Technical Assistance program'' and ``DELTA
program'' mean the Defense Loan and Technical Assistance
program that has been established by a memorandum of
understanding entered into by the Administrator and the
Secretary of Defense on June 26, 1995.
(b) Assistance.--
(1) Authority.--Under the DELTA program, the Administrator
may assist small business concerns that are economically
dependent on defense expenditures to acquire dual-use
capabilities.
(2) Forms of assistance.--Forms of assistance authorized
under paragraph (1) are as follows:
(A) Loan guarantees.--Loan guarantees under the terms and
conditions specified under this section and other applicable
law.
(B) Nonfinancial assistance.--Other forms of assistance
that are not financial.
(c) Administration of Program.--In the administration of
the DELTA program under this section, the Administrator
shall--
(1) process applications for DELTA program loan guarantees;
(2) guarantee repayment of the resulting loans in
accordance with this section; and
(3) take such other actions as are necessary to administer
the program.
(d) Selection and Eligibility Requirements for DELTA Loan
Guarantees.--
(1) In general.--The selection criteria and eligibility
requirements set forth in this subsection shall be applied in
the selection of small business concerns to receive loan
guarantees under the DELTA program.
(2) Selection criteria.--The criteria used for the
selection of a small business concern to receive a loan
guarantee under this section are as follows:
(A) The selection criteria established under the memorandum
of understanding referred to in subsection (a)(3).
(B) The extent to which the loans to be guaranteed would
support the retention of defense workers whose employment
would otherwise be permanently or temporarily terminated as a
result of reductions in expenditures by the United States for
defense, the termination or cancellation of a defense
contract, the failure to proceed with an approved major
weapon system, the merger or consolidation of the operations
of a defense contractor, or the closure or realignment of a
military installation.
(C) The extent to which the loans to be guaranteed would
stimulate job creation and new
[[Page H10495]]
economic activities in communities most adversely affected by
reductions in expenditures by the United States for defense,
the termination or cancellation of a defense contract, the
failure to proceed with an approved major weapon system, the
merger or consolidation of the operations of a defense
contractor, or the closure or realignment of a military
installation.
(D) The extent to which the loans to be guaranteed would be
used to acquire (or permit the use of other funds to acquire)
capital equipment to modernize or expand the facilities of
the borrower to enable the borrower to remain in the national
technology and industrial base available to the Department of
Defense.
(3) Eligibility requirements.--To be eligible for a loan
guarantee under the DELTA program, a borrower must
demonstrate to the satisfaction of the Administrator that,
during any 1 of the 5 preceding operating years of the
borrower, not less than 25 percent of the value of the
borrower's sales were derived from--
(A) contracts with the Department of Defense or the
defense-related activities of the Department of Energy; or
(B) subcontracts in support of defense-related prime
contracts.
(e) Maximum Amount of Loan Principal.--With respect to each
borrower, the maximum amount of loan principal for which the
Administrator may provide a guarantee under this section
during a fiscal year may not exceed $1,250,000.
(f) Loan Guaranty Rate.--The maximum allowable guarantee
percentage for loans guaranteed under this section may not
exceed 80 percent.
(g) Funding.--
(1) In general.--The funds that have been made available
for loan guarantees under the DELTA program and have been
transferred from the Department of Defense to the Small
Business Administration before the date of the enactment of
this Act shall be used for carrying out the DELTA program
under this section.
(2) Continued availability of existing funds.--The funds
made available under the second proviso under the heading
``Research, Development, Test and Evaluation, Defense-Wide''
in Public Law 103-335 (108 Stat. 2613) shall be available
until expended--
(A) to cover the costs (as defined in section 502(5) of the
Federal Credit Reform Act of 1990 (2 U.S.C. 661a(5))) of loan
guarantees issued under this section; and
(B) to cover the reasonable costs of the administration of
the loan guarantees.
SEC. 508. VERY SMALL BUSINESS CONCERNS.
Section 304(i) of the Small Business Administration
Reauthorization and Amendments Act of 1994 (15 U.S.C. 644
note) is amended by striking ``September 30, 1998'' and
inserting ``September 30, 2000''.
SEC. 509. TRADE ASSISTANCE PROGRAM FOR SMALL BUSINESS
CONCERNS ADVERSELY AFFECTED BY NAFTA.
The Administrator shall coordinate Federal assistance in
order to provide counseling to small business concerns
adversely affected by the North American Free Trade
Agreement.
TITLE VI--HUBZONE PROGRAM
SEC. 601. SHORT TITLE.
This title may be cited as the ``HUBZone Act of 1997''.
SEC. 602. HISTORICALLY UNDERUTILIZED BUSINESS ZONES.
(a) Definitions.--Section 3 of the Small Business Act (15
U.S.C. 632) (as amended by section 412 of this Act) is
amended by adding at the end the following:
``(p) Definitions Relating to HUBZones.--In this Act:
``(1) Historically underutilized business zone.--The term
`historically underutilized business zone' means any area
located within 1 or more--
``(A) qualified census tracts;
``(B) qualified nonmetropolitan counties; or
``(C) lands within the external boundaries of an Indian
reservation.
``(2) HUBZone.--The term `HUBZone' means a historically
underutilized business zone.
``(3) HUBZone small business concern.--The term `HUBZone
small business concern' means a small business concern--
``(A) that is owned and controlled by 1 or more persons,
each of whom is a United States citizen; and
``(B) the principal office of which is located in a
HUBZone; or
``(4) Qualified areas.--
``(A) Qualified census tract.--The term `qualified census
tract' has the meaning given that term in section
42(d)(5)(C)(ii)(I) of the Internal Revenue Code of 1986.
``(B) Qualified nonmetropolitan county.--The term
`qualified nonmetropolitan county' means any county--
``(i) that, based on the most recent data available from
the Bureau of the Census of the Department of Commerce--
``(I) is not located in a metropolitan statistical area (as
defined in section 143(k)(2)(B) of the Internal Revenue Code
of 1986); and
``(II) in which the median household income is less than 80
percent of the nonmetropolitan State median household income;
or
``(ii) that, based on the most recent data available from
the Secretary of Labor, has an unemployment rate that is not
less than 140 percent of the statewide average unemployment
rate for the State in which the county is located.
``(5) Qualified hubzone small business concern.--
``(A) In general.--A HUBZone small business concern is
`qualified', if--
``(i) the small business concern has certified in writing
to the Administrator (or the Administrator otherwise
determines, based on information submitted to the
Administrator by the small business concern, or based on
certification procedures, which shall be established by the
Administration by regulation) that--
``(I) it is a HUBZone small business concern;
``(II) not less than 35 percent of the employees of the
small business concern reside in a HUBZone, and the small
business concern will attempt to maintain this employment
percentage during the performance of any contract awarded to
the small business concern on the basis of a preference
provided under section 31(b); and
``(III) with respect to any subcontract entered into by the
small business concern pursuant to a contract awarded to the
small business concern under section 31, the small business
concern will ensure that--
``(aa) in the case of a contract for services (except
construction), not less than 50 percent of the cost of
contract performance incurred for personnel will be expended
for its employees or for employees of other HUBZone small
business concerns; and
``(bb) in the case of a contract for procurement of
supplies (other than procurement from a regular dealer in
such supplies), not less than 50 percent of the cost of
manufacturing the supplies (not including the cost of
materials) will be incurred in connection with the
performance of the contract in a HUBZone by 1 or more HUBZone
small business concerns; and
``(ii) no certification made or information provided by the
small business concern under clause (i) has been, in
accordance with the procedures established under section
31(c)(1)--
``(I) successfully challenged by an interested party; or
``(II) otherwise determined by the Administrator to be
materially false.
``(B) Change in percentages.--The Administrator may utilize
a percentage other than the percentage specified in under
item (aa) or (bb) of subparagraph (A)(i)(III), if the
Administrator determines that such action is necessary to
reflect conventional industry practices among small business
concerns that are below the numerical size standard for
businesses in that industry category.
``(C) Construction and other contracts.--The Administrator
shall promulgate final regulations imposing requirements that
are similar to those specified in subclauses (IV) and (V) of
subparagraph (A)(i) on contracts for general and specialty
construction, and on contracts for any other industry
category that would not otherwise be subject to those
requirements. The percentage applicable to any such
requirement shall be determined in accordance with
subparagraph (B).
``(D) List of qualified small business concerns.--The
Administrator shall establish and maintain a list of
qualified HUBZone small business concerns, which list shall,
to the extent practicable--
``(i) include the name, address, and type of business with
respect to each such small business concern;
``(ii) be updated by the Administrator not less than
annually; and
``(iii) be provided upon request to any Federal agency or
other entity.''.
(b) Federal Contracting.--
(1) In general.--The Small Business Act (15 U.S.C. 631 et
seq.) is amended--
(A) by redesignating section 31 as section 32; and
(B) by inserting after section 30 the following:
``SEC. 31. HUBZONE PROGRAM.
``(a) In General.--There is established within the
Administration a program to be carried out by the
Administrator to provide for Federal contracting assistance
to qualified HUBZone small business concerns in accordance
with this section.
``(b) Eligible Contracts.--
``(1) Definitions.--In this subsection--
``(A) the term `contracting officer' has the meaning given
that term in section 27(f)(5) of the Office of Federal
Procurement Policy Act (41 U.S.C. 423(f)(5)); and
``(B) the term `full and open competition' has the meaning
given that term in section 4 of the Office of Federal
Procurement Policy Act (41 U.S.C. 403).
``(2) Authority of contracting officer.--Notwithstanding
any other provision of law--
``(A) a contracting officer may award sole source contracts
under this section to any qualified HUBZone small business
concern, if--
``(i) the qualified HUBZone small business concern is
determined to be a responsible contractor with respect to
performance of such contract opportunity, and the contracting
officer does not have a reasonable expectation that 2 or more
qualified HUBZone small business concerns will submit offers
for the contracting opportunity;
``(ii) the anticipated award price of the contract
(including options) will not exceed--
``(I) $5,000,000, in the case of a contract opportunity
assigned a standard industrial classification code for
manufacturing; or
``(II) $3,000,000, in the case of all other contract
opportunities; and
``(iii) in the estimation of the contracting officer, the
contract award can be made at a fair and reasonable price;
``(B) a contract opportunity shall be awarded pursuant to
this section on the basis of competition restricted to
qualified HUBZone small business concerns if the contracting
officer has a reasonable expectation that not less than 2
qualified HUBZone small business concerns will submit offers
and that the award can be made at a fair market price; and
``(C) not later than 5 days from the date the
Administration is notified of a procurement officer's
decision not to award a contract opportunity under this
section to a qualified HUBZone small business concern, the
Administrator may notify the contracting officer of the
intent to appeal the contracting officer's decision, and
within 15 days of such date the Administrator may file a
written request for reconsideration of the contracting
officer's decision
[[Page H10496]]
with the Secretary of the department or agency head.
``(3) Price evaluation preference in full and open
competitions.--In any case in which a contract is to be
awarded on the basis of full and open competition, the price
offered by a qualified HUBZone small business concern shall
be deemed as being lower than the price offered by another
offeror (other than another small business concern), if the
price offered by the qualified HUBZone small business concern
is not more than 10 percent higher than the price offered by
the otherwise lowest, responsive, and responsible offeror.
``(4) Relationship to other contracting preferences.--A
procurement may not be made from a source on the basis of a
preference provided in paragraph (2) or (3), if the
procurement would otherwise be made from a different source
under section 4124 or 4125 of title 18, United States Code,
or the Javits-Wagner-O'Day Act (41 U.S.C. 46 et seq.).
``(c) Enforcement; Penalties.--
``(1) Verification of eligibility.--In carrying out this
section, the Administrator shall establish procedures
relating to--
``(A) the filing, investigation, and disposition by the
Administration of any challenge to the eligibility of a small
business concern to receive assistance under this section
(including a challenge, filed by an interested party,
relating to the veracity of a certification made or
information provided to the Administration by a small
business concern under section 3(p)(5)); and
``(B) verification by the Administrator of the accuracy of
any certification made or information provided to the
Administration by a small business concern under section
3(p)(5).
``(2) Examinations.--The procedures established under
paragraph (1) may provide for program examinations (including
random program examinations) by the Administrator of any
small business concern making a certification or providing
information to the Administrator under section 3(p)(5).
``(3) Provision of data.--Upon the request of the
Administrator, the Secretary of Labor, the Secretary of
Housing and Urban Development, and the Secretary of the
Interior (or the Assistant Secretary for Indian Affairs),
shall promptly provide to the Administrator such information
as the Administrator determines to be necessary to carry out
this subsection.
``(4) Penalties.--In addition to the penalties described in
section 16(d), any small business concern that is determined
by the Administrator to have misrepresented the status of
that concern as a `HUBZone small business concern' for
purposes of this section, shall be subject to--
``(A) section 1001 of title 18, United States Code; and
``(B) sections 3729 through 3733 of title 31, United States
Code.''.
(2) Initial limited applicability.--During the period
beginning on the date of enactment of this Act and ending on
September 30, 2000, section 31 of the Small Business Act (as
added by paragraph (1) of this subsection) shall apply only
to procurements by--
(A) the Department of Defense;
(B) the Department of Agriculture;
(C) the Department of Health and Human Services;
(D) the Department of Transportation;
(E) the Department of Energy;
(F) the Department of Housing and Urban Development;
(G) the Environmental Protection Agency;
(H) the National Aeronautics and Space Administration;
(I) the General Services Administration; and
(J) the Department of Veterans Affairs.
SEC. 603. TECHNICAL AND CONFORMING AMENDMENTS TO THE SMALL
BUSINESS ACT.
(a) Performance of Contracts.--Section 8(d) of the Small
Business Act (15 U.S.C. 637(d)) is amended--
(1) in paragraph (1)--
(A) in the first sentence, by striking ``,, small business
concerns owned and controlled by socially and economically
disadvantaged individuals'' and inserting ``, qualified
HUBZone small business concerns, small business concerns
owned and controlled by socially and economically
disadvantaged individuals''; and
(B) in the second sentence, by inserting ``qualified
HUBZone small business concerns,'' after ``small business
concerns,'';
(2) in paragraph (3)--
(A) by inserting ``qualified HUBZone small business
concerns,'' after ``small business concerns,'' each place
that term appears; and
(B) by adding at the end the following:
``(F) In this contract, the term `qualified HUBZone small
business concern' has the meaning given that term in section
3(p) of the Small Business Act.'';
(3) in paragraph (4)(E), by striking ``small business
concerns and'' and inserting ``small business concerns,
qualified HUBZone small business concerns, and'';
(4) in paragraph (6), by inserting ``qualified HUBZone
small business concerns,'' after ``small business concerns,''
each place that term appears; and
(5) in paragraph (10), by inserting ``qualified HUBZone
small business concerns,'' after ``small business
concerns,''.
(b) Awards of Contracts.--Section 15 of the Small Business
Act (15 U.S.C. 644) is amended--
(1) in subsection (g)(1)--
(A) by inserting ``qualified HUBZone small business
concerns,'' after ``small business concerns,'' each place
that term appears;
(B) in the second sentence, by striking ``20 percent'' and
inserting ``23 percent''; and
(C) by inserting after the second sentence the following:
``The Governmentwide goal for participation by qualified
HUBZone small business concerns shall be established at not
less than 1 percent of the total value of all prime contract
awards for fiscal year 1999, not less than 1.5 percent of the
total value of all prime contract awards for fiscal year
2000, not less than 2 percent of the total value of all prime
contract awards for fiscal year 2001, not less than 2.5
percent of the total value of all prime contract awards for
fiscal year 2002, and not less than 3 percent of the total
value of all prime contract awards for fiscal year 2003 and
each fiscal year thereafter.'';
(2) in subsection (g)(2)--
(A) in the first sentence, by striking ``,, by small
business concerns owned and controlled by socially and
economically disadvantaged individuals'' and inserting ``, by
qualified HUBZone small business concerns, by small business
concerns owned and controlled by socially and economically
disadvantaged individuals'';
(B) in the second sentence, by inserting ``qualified
HUBZone small business concerns,'' after ``small business
concerns,''; and
(C) in the fourth sentence, by striking ``by small business
concerns owned and controlled by socially and economically
disadvantaged individuals and participation by small business
concerns owned and controlled by women'' and inserting ``by
qualified HUBZone small business concerns, by small business
concerns owned and controlled by socially and economically
disadvantaged individuals, and by small business concerns
owned and controlled by women''; and
(3) in subsection (h), by inserting ``qualified HUBZone
small business concerns,'' after ``small business concerns,''
each place that term appears.
(c) Offenses and Penalties.--Section 16 of the Small
Business Act (15 U.S.C. 645) is amended--
(1) in subsection (d)(1)--
(A) by inserting ``, a `qualified HUBZone small business
concern','' after `` `small business concern',''; and
(B) in subparagraph (A), by striking ``section 9 or 15''
and inserting ``section 9, 15, or 31''; and
(2) in subsection (e), by inserting ``, a `HUBZone small
business concern','' after `` `small business concern',''.
SEC. 604. OTHER TECHNICAL AND CONFORMING AMENDMENTS.
(a) Title 10, United States Code.--Section 2323 of title
10, United States Code, is amended--
(1) in subsection (a)(1)(A), by inserting before the
semicolon the following: ``, and qualified HUBZone small
business concerns (as defined in section 3(p) of the Small
Business Act)''; and
(2) in subsection (f)(1), by inserting ``or as a qualified
HUBZone small business concern (as defined in section 3(p) of
the Small Business Act)'' after ``(as described in subsection
(a))''.
(b) Federal Home Loan Bank Act.--Section 21A(b)(13) of the
Federal Home Loan Bank Act (12 U.S.C. 1441a(b)(13)) is
amended--
(1) by striking ``concerns and small'' and inserting
``concerns, small''; and
(2) by inserting ``, and qualified HUBZone small business
concerns (as defined in section 3(p) of the Small Business
Act)'' after ``disadvantaged individuals''.
(c) Small Business Economic Policy Act of 1980.--Section
303(e) of the Small Business Economic Policy Act of 1980 (15
U.S.C. 631b(e)) is amended--
(1) in paragraph (1), by striking ``and'' at the end;
(2) in paragraph (2), by striking the period at the end and
inserting ``; and''; and
(3) by adding at the end the following:
``(3) qualified HUBZone small business concern (as defined
in section 3(p) of the Small Business Act).''.
(d) Small Business Investment Act of 1958.--Section
411(c)(3)(B) of the Small Business Investment Act of 1958 (15
U.S.C. 694b(c)(3)(B)) is amended by inserting before the
semicolon the following: ``, or to a qualified HUBZone small
business concern (as defined in section 3(p) of the Small
Business Act)''.
(e) Title 31, United States Code.--
(1) Contracts for collection services.--Section 3718(b) of
title 31, United States Code, is amended--
(A) in paragraph (1)(B), by inserting ``and law firms that
are qualified HUBZone small business concerns (as defined in
section 3(p) of the Small Business Act)'' after
``disadvantaged individuals''; and
(B) in paragraph (3)--
(i) in the first sentence, by inserting before the period
``and law firms that are qualified HUBZone small business
concerns'';
(ii) in subparagraph (A), by striking ``and'' at the end;
(iii) in subparagraph (B), by striking the period at the
end and inserting ``; and''; and
(iv) by adding at the end the following:
``(C) the term `qualified HUBZone small business concern'
has the meaning given that term in section 3(p) of the Small
Business Act.''.
(2) Payments to local governments.--Section 6701(f) of
title 31, United States Code, is amended--
(A) in paragraph (1)--
(i) in subparagraph (A), by striking ``and'' at the end;
(ii) in subparagraph (B), by striking the period at the end
and inserting ``; and''; and
(iii) by adding at the end the following:
``(C) qualified HUBZone small business concerns.''; and
(B) in paragraph (3)--
(i) in subparagraph (A), by striking ``and'' at the end;
(ii) in subparagraph (B), by striking the period at the end
and inserting ``; and''; and
(iii) by adding at the end the following:
``(C) the term `qualified HUBZone small business concern'
has the meaning given that term in section 3(p) of the Small
Business Act (15 U.S.C. 632(o)).''.
(3) Regulations.--Section 7505(c) of title 31, United
States Code, is amended by striking
[[Page H10497]]
``small business concerns and'' and inserting ``small
business concerns, qualified HUBZone small business concerns,
and''.
(f) Office of Federal Procurement Policy Act.--
(1) Enumeration of included functions.--Section 6(d) of the
Office of Federal Procurement Policy Act (41 U.S.C. 405(d))
is amended--
(A) in paragraph (11), by inserting ``qualified HUBZone
small business concerns (as defined in section 3(p) of the
Small Business Act),'' after ``small businesses,''; and
(B) in paragraph (12), by inserting ``qualified HUBZone
small business concerns (as defined in section 3(p) of the
Small Business Act (15 U.S.C. 632(o)),'' after ``small
businesses,''.
(2) Procurement data.--Section 502 of the Women's Business
Ownership Act of 1988 (41 U.S.C. 417a) is amended--
(A) in subsection (a)--
(i) in the first sentence, by inserting ``the number of
qualified HUBZone small business concerns,'' after
``Procurement Policy''; and
(ii) by inserting a comma after ``women''; and
(B) in subsection (b), by inserting after ``section 204 of
this Act'' the following: ``, and the term `qualified HUBZone
small business concern' has the meaning given that term in
section 3(p) of the Small Business Act (15 U.S.C. 632(o)).''.
(g) Energy Policy Act of 1992.--Section 3021 of the Energy
Policy Act of 1992 (42 U.S.C. 13556) is amended--
(1) in subsection (a)--
(A) in paragraph (2), by striking ``or'';
(B) in paragraph (3), by striking the period and inserting
``; or''; and
(C) by adding at the end the following:
``(4) qualified HUBZone small business concerns.''; and
(2) in subsection (b), by adding at the end the following:
``(3) The term `qualified HUBZone small business concern'
has the meaning given that term in section 3(p) of the Small
Business Act (15 U.S.C. 632(o)).''.
(h) Title 49, United States Code.--
(1) Project grant application approval conditioned on
assurances about airport operation.--Section 47107(e) of
title 49, United States Code, is amended--
(A) in paragraph (1), by inserting before the period ``or
qualified HUBZone small business concerns (as defined in
section 3(p) of the Small Business Act)'';
(B) in paragraph (4)(B), by inserting before the period
``or as a qualified HUBZone small business concern (as
defined in section 3(p) of the Small Business Act)''; and
(C) in paragraph (6), by inserting ``or a qualified HUBZone
small business concern (as defined in section 3(p) of the
Small Business Act)'' after ``disadvantaged individual''.
(2) Minority and disadvantaged business participation.--
Section 47113 of title 49, United States Code, is amended--
(A) in subsection (a)--
(i) in paragraph (1), by striking the period at the end and
inserting a semicolon;
(ii) in paragraph (2), by striking the period at the end
and inserting ``; and''; and
(iii) by adding at the end the following:
``(3) the term `qualified HUBZone small business concern'
has the meaning given that term in section 3(p) of the Small
Business Act (15 U.S.C. 632(o)).''; and
(B) in subsection (b), by inserting before the period ``or
qualified HUBZone small business concerns''.
SEC. 605. REGULATIONS.
(a) In General.--Not later than 180 days after the date of
enactment of this Act, the Administrator shall publish in the
Federal Register such final regulations as may be necessary
to carry out this title and the amendments made by this
title.
(b) Federal Acquisition Regulation.--Not later than 180
days after the date on which final regulations are published
under subsection (a), the Federal Acquisition Regulatory
Council shall amend the Federal Acquisition Regulation in
order to ensure consistency between the Federal Acquisition
Regulation, this title and the amendments made by this title,
and the final regulations published under subsection (a).
SEC. 606. REPORT.
Not later than March 1, 2002, the Administrator shall
submit to the Committees a report on the implementation of
the HUBZone program established under section 31 of the Small
Business Act (as added by section 602(b) of this title) and
the degree to which the HUBZone program has resulted in
increased employment opportunities and an increased level of
investment in HUBZones (as defined in section 3(p) of the
Small Business Act (15 U.S.C. 632(p)), as added by section
602(a) of this title).
SEC. 607. AUTHORIZATION OF APPROPRIATIONS.
Section 20 of the Small Business Act (15 U.S.C. 631 note)
(as amended by section 101 of this Act) is amended--
(1) in subsection (c), by adding at the end the following:
``(3) HUBZone program.--There are authorized to be
appropriated to the Administration to carry out the program
under section 31, $5,000,000 for fiscal year 1998.'';
(2) in subsection (d), by adding at the end the following:
``(3) HUBZone program.--There are authorized to be
appropriated to the Administration to carry out the program
under section 31, $5,000,000 for fiscal year 1999.''; and
(3) in subsection (e), by adding at the end the following:
``(3) HUBZone program.--There are authorized to be
appropriated to the Administration to carry out the program
under section 31, $5,000,000 for fiscal year 2000.''.
TITLE VII--SERVICE DISABLED VETERANS
SEC. 701. 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. 702. DEFINITIONS.
In this title:
(1) Eligible veteran.--The term ``eligible veteran'' means
a disabled veteran (as defined in section 4211(3) of title
38, United States Code).
(2) 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) that is at least 51 percent owned by 1 or more eligible
veterans, 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 veterans; and
(B) whose management and daily business operations are
controlled by eligible veterans.
SEC. 703. REPORT BY SMALL BUSINESS ADMINISTRATION.
(a) Study and Report.--
(1) In general.--Not later than 9 months after the date of
enactment of this Act, the Administrator shall conduct a
comprehensive study and submit to the Committees a final
report containing findings and recommendations of the
Administrator on--
(A) the needs of small business concerns owned and
controlled by eligible veterans;
(B) the availability and utilization of Administration
programs by small business concerns owned and controlled by
eligible veterans;
(C) 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
(D) methods to improve Administration and other agency
programs to serve the needs of small business concerns owned
and controlled by eligible veterans.
(2) Contents.--The report under paragraph (1) 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 nonprofit
sector, and Federal or State government agencies; and
(3) shall have access to any information within other
Federal agencies that pertains to such veterans and their
small businesses, unless such access is specifically
prohibited by law.
SEC. 704. INFORMATION COLLECTION.
After the date of issuance of the report required by
section 703(a), 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. 705. 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. 706. 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 may make loans under this
subsection to small business concerns owned and controlled by
disabled veterans (as defined in section 4211(3) of title 38,
United States Code).''.
SEC. 707. 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 that provide
entrepreneurial training, business development assistance,
counseling, and management assistance to small business
concerns, including, among others, the Small Business
Development Center program and the Service Corps of Retired
Executives (SCORE) program.
SEC. 708. GRANTS FOR ELIGIBLE VETERANS' OUTREACH PROGRAMS.
Section 8(b) of the Small Business Act (15 U.S.C. 637(b))
is amended--
(1) in paragraph (15), by striking ``and'' at the end;
(2) in the first paragraph designated as paragraph (16), by
striking the period at the end and inserting ``; and''; and
(3) by striking the second paragraph designated as
paragraph (16) and inserting the following:
``(17) to make grants to, and enter into contracts and
cooperative agreements with, educational institutions,
private businesses, veterans' nonprofit community-based
organizations,
[[Page H10498]]
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. 709. 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, which
program shall include business training and management
assistance, employment and relocation counseling, and
dissemination of information on veterans' benefits and
veterans' entitlements.
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.
Mr. Speaker, the primary purpose of this legislation is to
reauthorize the Small Business Administration and the programs which
that agency oversees pursuant to the Small Business Act and the Small
Business Investment Act. This reauthorization covers fiscal years 1998,
1999 and 2000. Except for a couple of new provisions added by the other
body, this legislation is identical to H.R. 2261, which this House
passed under suspension of the rules by a vote of 397 to 17 just 6
weeks ago.
We regularly reauthorize the bulk of the programs contained in this
legislation for 3-year periods. The programs contained in this
legislation include the financial programs of the SBA, the 7(a) general
business loan guarantee program, the section 504 Certified Development
Company program, the Microloan program, and the Small Business
Investment Company program.
This legislation also changes and improves various programs,
specifically modifying the section 504 Preferred Certified Lender
Program, the SBIC program, the Women's Business Center program and the
SBDC program. The SBA also provides hundreds of millions of dollars in
vital disaster assistance to small businesses and homeowners every
year, and this legislation reauthorizes that assistance.
Title VII of the measure before us is the result of the collective
work of multiple committees and individual Members. It 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 provisions are the
products of bipartisan efforts by myself and the gentleman from New
York [Mr. LaFalce], our committee's ranking member, working together
with the chairman of the Committee on Rules and the chairman of the
Committee on Veterans' Affairs.
Section 501 of this legislation is also the product of a bipartisan
and multi-committee effort both here and in the Senate. It contains
most of the features of H.R. 2429, as reported by the Committee on
Science, and is a 4-year reauthorization of the pilot Small Business
Technology Transfer Program.
As I said earlier, Mr. Speaker, the legislation before us today has
some additional components that were added since we passed it here in
the House in late September. These additional elements have been added
as a result of collaborative and bipartisan efforts between the House
and the Senate and, in fact, have involved the collective work of
multiple committees from both Houses working in conjunction with
representatives of the administration.
Title VI of this legislation establishes the HUBZone program, which
will provide incentives to businesses that locate in and employ
residents from economically distressed areas, thereby targeting inner
cities and rural communities that have low household incomes, high
unemployment and whose communities have suffered from a lack of
investment.
Subtitle (b) of title IV of this legislation is another component
which was added to this legislation by the Senate and addresses the
important small business procurement issue of contract bundling. This
provision is the result of lengthy negotiations, involving several
Senate and House committees and the administration.
Finally, section 507 of this legislation addresses the Defense Loan
and Technical Assistance Program, or DELTA program, and is of great
importance to numerous small businesses located in areas that have been
adversely impacted as a result of the closing of military
installations.
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 and include extraneous material.)
Mr. LaFALCE. Mr. Speaker, I rise in support of S. 1139, the Small
Business Reauthorization Act of 1997.
Mr. Speaker, this legislation includes the requisite authorization
for programs administered by the Small Business Administration for
fiscal year 1998 and the two ensuing years. It also includes important
program changes for a number of the SBA programs.
Specifically, it includes proposals for women's business development,
which I advocated in separate legislation, such as making the women's
business development a permanent program and increasing it to 5 years
in lieu of the existing 3-year program.
It also enhances the operation of the 504 program, also known as the
certified development company or CDC program, which I authored in 1980.
It makes needed improvements to allow implementation of the premier
lenders program, which allows SBA to delegate loan making, servicing
and liquidation functions to the best CDC's. Without this delegation of
authority, which results in large reductions in SBA employee time
demands, this program would grind to a halt, as would the 7(a) program
without its similar delegation of authority, for SBA simply does not
have sufficient personnel to make and service loans today. We depend on
participating lenders to serve this function under SBA guidelines and
oversight.
But I would be remiss in my responsibilities as the ranking Democrat
on the Committee on Small Business if I did not point out that this
bill is not without concern. At Senate insistence, it includes a new
program to assist economically distressed areas by channeling Federal
contracting to them. Under this laudable concept, the distressed areas,
called HUBZones, would receive major amounts of Federal contract
dollars if the small business contractors unemployment base includes 35
percent of its workforce from these HUBZones. Further, it would
increase the small business contracting goal from 20 to 23 percent, a
provision I strongly favor.
I am very pleased to note that we were able to secure a major, major
change from the version originally passed by the other body. The
earlier version would have permitted contracts to be taken from an
existing program which assists minorities and women, the 8(a) program.
{time} 1630
We were successful in insisting that that provision be dropped
totally. The Senate insisted on all the other provisions in the HUBZone
title with very little change. I resisted that, too, until specifically
prevailed upon by the Small Business Administration.
Inclusion of this HUBZone concept as a permanent program without the
customary trial provisions and other safeguards caused a number of
Members of Congress to raise strong concerns, particularly because of
the possibility of adverse impact on the 8(a) contracting program. Now,
this is the most important program operated by the Federal Government
to facilitate the growth and development of minority small businesses.
Any proposals which might place this program in jeopardy naturally
cause concern to those Members who place a high priority on the
development of minority small business.
We tried very hard to get a deletion of the entire HUBZone proposal
even after they had deleted every single reference to 8(a). The HUBZone
proposal is still maintained in the bill, but fortunately it confers
considerable discretion on the Administrator of the SBA who will
implement. After extensive discussions with Administrator Aida Alvarez,
she sent me a very forceful letter explaining the administration's
support for the reauthorization bill now under consideration and
pledging that SBA will not permit the implementation of the HUBZone's
program to negatively affect the 8(a) program. I
[[Page H10499]]
will include Miss Alvarez' strong letter of support for the
authorization bill in the Record for any Member who is interested.
The letter referred to is as follows:
U.S. Small Business Administration,
Washington, D.C., November 8, 1997.
Hon. John J. LaFalce,
U.S. House of Representatives,
Washington, D.C.
Dear Representative LaFalce: The Administration supports
realization of the programs of the Small Business
Administration and supports House passage of S. 1139. The
bill reauthorizes small business loans which assist tens of
thousands of small businesses each year and contribute to the
vitality of economy. This bill recognizes the importance of
women and service disabled veteran entrepreneurs. And, it
makes permanent SBA's Microloan Program which helps those
entrepreneurs who need very small amounts of credit. We need
this legislation to ensure that we can continue to properly
serve our small business customers.
Some Members have raised concerns about the HUBZones
provisions in the authorization bill. Please note that unlike
earlier versions of the reauthorization bill, the new version
of the bill before the House has removed the harmful
provisions that would have affected the current preference
for 8(a) in the Defense Federal Acquisition Regulations
(DFAR), and my ability to appeal contracting actions that
might affect 8(a).
I can assure you that SBA will not permit the
implementation of the HUBZones program to negatively affect
the 8(a) program. As you know, I am a strong supporter of the
8(a) program.
Moreover, the bill will increase the federal procurement
goal for small business from 20 to 23 percent--increasing
opportunities for all small businesses including 8(a). With
this overall increase in federal contracting dollars for
small businesses there will be room for an increase in 8(a)
contracts and I intend to pursue increases in 8(a) contracts
aggressively.
In the SBA's strategic plan I have committed to increasing
overall procurement for small disadvantaged businesses from
5.5 percent to 7 percent of all federal procurement by the
year 2000. Enactment of HUBZones will not affect these goals.
It is my intention to increase 8(a) procurement as a
percentage of total federal procurement. Presently, 3.2
percent of all federal procurement dollars go to the 8(a)
program. Recently proposed rule changes will allow increased
flexibility in small business teaming and joint ventures, and
create a new mentor-protege program. I also intend to
increase 8(a) contracts through a more aggressive goaling
posture with other federal agencies and through the full
implementation of the new on-line PRO-Net procurement
system. Enactment of HUBZones will not affect these
strategies.
The bill allows federal contractors to utilize a sole
source contracting vehicle to access HUBZones companies.
However, we do not believe that this provision will
necessarily affect 8(a) firms. In fact, federal contracting
officers may be more likely to shift competitive contracting
dollars to HUBZones because of the relative ease in a sole
source vehicle rather than to shift these contracts from
8(a), where the ease of procurement is already in place. In
fact, 8(a) firms are exactly the kinds of firms that would
most likely take advantage of the new HUBZones sole source
authority--especially after they have left the 8(a) program.
However, I can assure the Members of the Small Business
Committee that we will take whatever steps are necessary in
the rulemaking process to ensure that the new sole source
provisions for HUBZones do not negatively affect 8(a). And, I
will closely monitor the sole source authority when used for
HUBZones. Should it be determined that there is a negative
effect on 8(a), I will use my authority to appeal contracts
to protect 8(a) firms.
I share your concern that SBA may not have sufficient
resources to implement the HUBZones over the next several
years. While the final appropriations bill has not yet been
enacted, we anticipate that the appropriations bill will
include enough resources to write the regulations and
implement the program in the first year. As presently
proposed, the SBA does not have adequate resources for full
implementation of the HUBZones program. I will not increase
our risks nor sacrifice the effectiveness of SBA's other
programs by shifting resources from these programs to
HUBZones. We will evaluate future resource needs after we
have analyzed the full on-going costs of the program and
provide the Congress with an estimate of these needs in our
budget submission.
I will keep the Small Business Committees informed of any
issues that may arise during the rulemaking process and
provide the Committees with quarterly reports until the
program is fully implemented. We will also continue to
consult closely with the 8(a) business community during this
period. After implementation, I will monitor federal
procurement contracting patterns and the use of the sole
source provisions for HUBZones. I will report to the Small
Business Committees on a semi-annual basis about trends in
federal procurement activity for small businesses and on the
use of sole source contracts. As we monitor HUBZones
implementation, SBA will also pursue regulatory changes
within the Administration to further protect 8(a) if
necessary. You also have my firm commitment that I will seek
legislative changes if we identify any adverse impact on the
8(a) program as a result of this monitoring.
Finally, because the bill retains my appeal authority on
behalf of 8(a), I will continue to intervene in the future,
if there are any specific instances of a federal agency
trying to move a contract from the 8(a) program to HUBZones.
Thank you for your consideration.
Sincerely,
Aida Alvarez,
Administrator.
Mr. Speaker, I reserve the balance of my time.
Mr. TALENT. Mr. Speaker, I yield 2 minutes to the distinguished
gentlewoman from New York [Mrs. Kelly].
Mrs. KELLY. Mr. Speaker, I thank the gentleman from Missouri [Mr.
Talent] for yielding me time.
I rise today in strong support of S. 1139, the Small Business
Programs Reauthorization and Amendments Act of 1997. This important
legislation will reauthorize the lending programs of the SBA, allowing
our Nation's small businesses to continue access to capital.
We are all aware of the important role that small businesses play in
maintaining the economic strength of the United States. They create the
vast majority of new jobs, provide countless new technological
innovations, and drive economic growth in our country, and
unfortunately there is often insufficient capital available for
entrepreneurs to use to start up new businesses or for current small
business owners to expand existing ones. This is the void that the
Small Business Administration's loan guarantee programs often fill.
Without passage of this important legislation, this valuable service
would be threatened. Our Nation's small businesses, and indeed our
economy, would suffer as a result.
The gentleman from Missouri [Mr. Talent] and the gentleman from New
York [Mr. LaFalce] have worked very closely to put together a
bipartisan bill that deserves the backing of every Member of this
House. I urge my colleagues to support the small business community and
support S. 1139.
Mr. LaFALCE. Mr. Speaker, I yield 3\1/4\ minutes to the gentlewoman
from New York [Ms. Velazquez].
Ms. VELAZQUEZ. Mr. Speaker, today we will pass this Small Business
Administration reauthorization bill which provides valuable resources
to a number of vital programs. While I have worked hard in support of
those programs, I rise today to address some elements of the bill that
I believe require further discussion.
The House Committee on Small Business, under the effective leadership
of the gentleman from Missouri [Mr. Talent] and the ranking Democrat,
the gentleman from New York [Mr. LaFalce], worked very hard to report
out a bill that would have helped small business. Unfortunately we are
not considering the product of our committee's work today. Instead we
are considering a bill from the other body that creates a multibillion-
dollar, I repeat multibillion-dollar, contracting program.
This proposal called HUBZones was never introduced in the House. This
unstudied and untested program has not even had one hearing, not in the
Committee on Small Business, the Committee on Banking and Financial
Services, the Committee on Education and the Workforce, or the
Committee on National Security, all of which would have jurisdiction
over the HUB's provisions. Because of this failure to properly examine
this program, I have my concerns about this proposal.
This program raises many serious questions. How will HUBZones work?
What kind of jobs will it create? What kind of small businesses will it
benefit? How will we measure its effectiveness? How will it work with
already established programs such as empowerment zones and enterprise
community? The effect of this legislation will be felt by the entire
small business community.
As the ranking member of the Subcommittee on Empowerment of the
Committee on Small Business, I have a responsibility to bring community
and economic development to our disadvantaged areas. I represent one of
the first districts in this country. I know the barriers that
entrepreneurs from my district and others like it must overcome. SBA
already addresses these needs through a variety of programs, which
raises the question of why we need another program when funding is
[[Page H10500]]
so scare. If the SBA is forced to spread out its resources to implement
HUBZones, it will jeopardize the operations of many successful small
business assistance programs.
Mr. Speaker, at this point I yield to the gentleman from New York
[Mr. LaFalce], the ranking member, and the chairman of the committee,
the gentleman from Missouri [Mr. Talent], to provide assurances that
the 8(a) program will not be harmed by these new HUBZone proposals.
Mr. LaFALCE. First of all, I want to praise the gentlewoman for the
outstanding work she has done on the Committee on Small Business,
particularly as the ranking Democrat on the Subcommittee on
Empowerment, and for the work she has done in refining the perspective
of the Small Business Administration on this.
As the gentlewoman knows, the bill as originally passed by the Senate
would have adversely impacted the 8(a) program as it would have changed
existing law to reduce the authority of the SBA over placement of
contracts within the program. That was stricken at our absolute
insistence.
I have also received a very strong letter in support of the bill from
Administrator Alvarez. Her letter, which I have inserted in the Record,
provides assurance that SBA will not permit the implementation of the
HUBZones Program to negatively affect the 8(a) program based upon the
continuation of current 8(a) authority unchanged and the
administrator's assurances. I believe the HUBZone Program can and will
be implemented in a manner that will not harm 8(a) and actually might
help those firms and other minority firms.
The SPEAKER pro tempore. The time of the gentlewoman from New York
[Ms. Velazquez] has expired.
Mr. TALENT. Mr. Speaker, I yield myself 30 seconds in which just to
say that that is also my understanding, and I have said from the
beginning, that I did not want this bill to effect the 8(a) program,
and as far as I am concerned, it is out of this bill, it is not
mentioned in this bill; and that the HUBZone bill is designed to
provide a little bit of an additional boost to procurement to
businesses that locate in these disadvantaged areas and hire these
individuals.
Mr. TALENT. Mr. Speaker, I yield 2 minutes to the gentleman from
Pennsylvania [Mr. English], a member of the committee.
Mr. ENGLISH of Pennsylvania. Mr. Speaker, this legislation before the
House today provides valuable support for a growing American economy.
The programs that are reauthorized under Senate bill 1139 play a
limited, but beneficial, role in promoting the most dynamic sector of
the American economy, and that is small business.
Mr. Speaker, recent experience with domestic job creation is
consistent. Two-thirds of the new jobs created in America are created
by small employers. Small business is a critical source of economic
expansion across the country whether in inner cities, developing
suburbs, or rural areas. The entrepreneurship of small employers is a
critical source of economic opportunity and growth in communities
throughout America. Today millions of small firms and risk-taking
individuals are building the economy of the next century, the economy
that our children will inherit and will provide their link to the
American dream.
The programs under the Small Business Administration that we are
reauthorizing today will not by themselves create the American economy
of the future; however by linking small businesses to sources of credit
and technical assistance, the SBA has the potential to nurture
entrepreneurship and promote more successful business starts and
expansions.
Mr. Speaker, I strongly support the enactment of this legislation.
While this Congress continues to have an aggressive agenda of
encouraging small business growth through regulatory reform and tax
relief, this legislation guarantees the continuation of limited,
targeted, programmatic support for small businesses by the Federal
Government.
As a member of the Committee on Small Business, I am acutely aware
that the SBA still has a long way to go to realize its potential as a
strong advocate and clearinghouse for the small business community.
Nevertheless, it is important that we continue the agency's successful
programs, such as the Small Business Development Centers in order to
encourage job creation and job retention in the most dynamic and
competitive sector of America's economy.
Mr. LaFALCE. Mr. Speaker, I yield such time as he may consume to the
distinguished gentleman from Virginia [Mr. Sisisky], the next most
senior member on the Democratic side of the aisle of the Committee on
Small Business.
[Mr. SISISKY asked and was given permission to revise and extend his
remarks.)
Mr. SISISKY. Mr. Speaker, I rise in support of S. 1139.
Mr. Speaker, I am pleased to be able to support this reauthorization
bill.
Along with other Members, I did have serious concerns about some of
its provisions. But those concerns have now been addressed, at least to
my satisfaction.
The legislation we have before us may have some flaws, but overall it
is a very good bill and I believe it must be passed.
Many Members had legitimate concerns and strong feelings about the
HUB Zones Program, in particular.
The bill passed by the House a little over month ago contained
absolutely no reference to HUB Zones. The Small Business Committee held
no hearings on HUB Zones. We had no chance to examine this concept
closely, let alone make improvements.
The House had no role at all in the design of this program. This
troubles me, and I don't think it's a very good way to legislate.
But on the whole, this is a very good bill. It reauthorizes the SBA
loan programs that are the life blood of many small businesses in this
country.
We know there is tremendous demand from small business for these
programs.
We know that this financing meets a need that would otherwise go
unmet. And we know how important financing is to small businesses, who
make such an enormous contribution to economic growth and to job
creation in this country.
For this reason alone, I think we have little choice but to pass this
authorization bill.
S. 1139 also reauthorizes other successful programs and makes a
number of program improvements that cannot be put off any longer.
I won't go into all the details, but there are several I'd like to
single out. This bill makes permanent the Microloan Program, which
assists the smallest of small businesses. It recognizes the importance
of disabled veteran entrepreneurs.
The provisions on contract bundling should help small businesses
better compete for Federal procurement opportunities. And one of SBA's
most successful programs--the Women's Business Centers--is expanded.
I strongly urge my colleagues to vote for this bill. We need to work
on both sides of the aisle--and with the administration--to see that it
is implemented in a way that meets the needs of America's small
business.
Mr. LaFALCE. Mr. Speaker, I yield 2 minutes to the distinguished
gentleman from Maryland [Mr. Wynn].
(Mr. WYNN asked and was given permission to revise and extend his
remarks.)
Mr. WYNN. Mr. Speaker, let me begin by thanking the chairman and the
ranking member of the committee for their hard work on this bill and
also for addressing the potential conflict with respect to the 8(a)
program and the HUBZone program. I am assured based on their comments
that the 8(a) program remains intact and is not threatened by this new
program.
I am very pleased to support S. 1139 because I think it is critical
to the advancement of small business. Small business, as is often
stated, is the engine for growth in this country. It generates over 50
percent of the gross national product. It generates more than half of
all new jobs. Small businesses also account for the employment of
minorities and women and our young people. We need to promote the
advancement of small business.
I am particularly impressed with this bill because it contains
language that restricts the practice of bundling. I had legislation on
this issue because it arose out of the White House Conference on Small
Business in which small businessmen said bundling, that is, the
consolidation of Federal contracts, represents a threat to our
survival. Right now eight major companies get more Federal Government
business than all small businesses combined. The Federal Government
does about $200 billion in contracting, so my colleagues can see this
is a very important matter. This bill has language
[[Page H10501]]
which would restrict the practice of bundling, require Government
agencies to justify the use of this type of consolidation.
The bill has also other attractive features. I think it is very
important that this bill continues the microlending program. Now,
$50,000 or $100,000 or $25,000 might not seem like a lot, but to a
small businessman just starting out, to an entrepreneur, that is very
important. We need to continue this program. The bill does that.
It also increases the goal for small business contracting from 20
percent to 23 percent. That is not a tremendous amount, but it is a
significant amount. That could result in additional $4 billion in
Government contracts available to the small business community. This,
too, is an important improvement in the bill.
I believe the bill addresses our concerns about HUBZones, creates new
programs and maintains important programs for our small business
community. I urge its adoption.
Mr. TALENT. Mr. Speaker, I yield 2 minutes to the gentlewoman from
Maryland [Mrs. Morella].
Mrs. MORELLA. Mr. Speaker, I thank the gentleman, the chairman of the
Committee on Small Business, for yielding the time to me, and, Mr.
Speaker, I rise in support of S. 1139, the Small Business
Administration reauthorization.
{time} 1645
Included in this bill is the majority of H.R. 2429, the Small
Business Technology Transfer Program Reauthorization Act, which was
reported out of the Committee on Science's Subcommittee on Technology
as well as the full Committee on Science. My comments will focus on
that aspect of the bill, although the bill in its totality is very
meritorious.
STTR is an important tech transfer program that has made over 800
awards totaling over $115 million since its inception in 1994. Nearly
$5 million of those have gone to Maryland small businesses, just as an
example. The STTR program expired on September 30 of this year, and
this bill will reauthorize STTR at its current set-aside level to
fiscal year 2001.
In addition, S. 1139 makes the following changes to the STTR program.
First, the bill requires agencies participating in STTR to include STTR
in their annual performance plans, as required by the Results Act. This
provision will ensure that each agency defines its goals along with
providing metrics to assist in evaluating those goals.
In concert with the performance plan, the bill requires each agency
participating in the STTR and SBIR programs to include those programs
in their strategic plan updates also required under the Results Act.
Second, S. 1139 contains an outreach program for States which receive
less than $5 million in awards in fiscal year 1995. This outreach
program is designed to increase participation among small businesses in
States that have traditionally received few STTR and SBIR awards. It is
not meant to mandate that States previously underrepresented by the
programs receive an increase in the number of dollar value awards, but,
instead, the provision should simply increase the number and quality of
applications for STTR and SBIR.
Third, S. 1139 requires agencies to collect data that will provide
Congress with information on the STTR program to assist in the
measurement of the program outputs and outcomes. Like the Results Act
language, this provision should help ensure the program is performing
in the most effective manner possible.
I want to thank the gentleman from Wisconsin [Mr. Sensenbrenner]; the
ranking member, the gentleman from California [Mr. Brown]; and the
ranking member of my subcommittee, the Subcommittee on Technology, the
gentleman from Tennessee [Mr. Gordon], for their support; and, indeed,
my hearty commendation and thanks to the Committee on Small Business
chairman, the gentleman from Missouri [Mr. Talent], and the ranking
member, the gentleman from New York [Mr. LaFalce]; and the gentleman
from Maryland [Mr. Bartlett], who serves on both committees.
U.S. Small Business Administration,
Washington, DC, November 6, 1997.
Hon. F. James Sensenbrenner,
Chairman, Committee on Science, U.S. House of
Representatives, Washington, DC.
Dear Mr. Chairman: Section 9(b)(7) of the Small Business
Act requires that the Administrator of the Small Business
Administration report to the House and Senate Small Business
Committees at least annually on the Small Business Innovation
Research (SBIR) and Small Business Technology Transfer (STTR)
programs of the Federal agencies. Because of your interest in
small business participation in the Nation's research and
development efforts, I am happy to send this report to the
House Committee on Science when I furnish it to the Committee
on Small Business.
I appreciate your interest in small business research and
development and look forward to any comments you may have on
our report.
Sincerely,
Aida Alvarez,
Administrator.
Mr. LaFALCE. Mr. Speaker, I yield 2 minutes to the distinguished
gentleman from Illinois [Mr. Poshard].
Mr. POSHARD. Mr. Speaker, I thank the gentleman for yielding me this
time.
Mr. Speaker, I rise today to support this legislation to reauthorize
programs of the Small Business Administration, but with some
reluctance. While I firmly believe in the mission of the SBA, certain
provisions in this bill are somewhat contentious.
Funding for HUBZones is one such issue. While I certainly support the
concept of spurring economic development in depressed urban and rural
areas, I agree with the gentleman from New York [Mr. LaFalce] that it
would be better to have a clearer idea about the ramifications of this
multibillion-dollar contracting program before it is approved.
However, I will support this package, because we should not hold up
funding for other important activities of the SBA, and the gradual
phase-in approach which was planned for HUBZone implementation should
allow for sufficient monitoring of its effectiveness and impact on
other SBA initiatives.
The goal of the SBA is to help small business owners reach their
potential by providing various resources, such as loans and training.
This assistance is especially important to rural communities, such as
those in my congressional district, that have seen severe economic
downturns over the last decade. A failure to fund these activities
could reverse many positive trends.
Recent years have seen a dramatic increase in the success of women
and minority-owned small businesses, and the SBA has had a significant
role in this development. Failure to pass this bill would adversely
affect the National Women's Business Council and would eliminate
funding for 18 women's business centers, preventing thousands of women
from getting necessary business training.
The Small Business Technology Transfer Program, which directs Federal
R&D money to researchers, inventors, and small business people to
develop the best ideas at our universities and research centers, this
successful program not only gives necessary help to small businesses
but helps university personnel have a hand in further developing their
ideas while remaining on campus. It also would not be reauthorized.
The Preferred Surety Bond Program, which provides hundreds of
millions of dollars in surety bonds to small construction companies,
would also cease to operate.
For these reasons and others, we must act now to ensure that the good
work of the SBA is not impeded. I urge my colleagues to vote for this
legislation.
Mr. TALENT. Mr. Speaker, I yield 2 minutes to the gentleman from New
York [Mr. Forbes].
(Mr. FORBES asked and was given permission to revise and extend his
remarks.)
Mr. FORBES. Mr. Speaker, I rise today in support of the Small
Business Reauthorization Act of 1997 and to commend the gentleman from
Missouri [Mr. Talent] and former chairman and now ranking member, the
gentleman from New York [Mr. LaFalce], for their devotion to the small
business community and this bill.
This bill, obviously, is the underpinning on which many of the Small
Business Administration programs are reauthorized. I would like the
opportunity to talk at great length about many of the wonderful
programs at SBA, but I will limit my remarks to
[[Page H10502]]
the extension of the Defense Loan and Technical Assistance Program,
which is commonly referred to as DELTA.
An important program that dealt with the unfortunate loss of business
for many defense-dependent businesses over the last decade, the DELTA
program is an important undertaking. I appreciate that the committee
has sought to reauthorize not only the DELTA program, but to expand it,
so that the many small businesses that could benefit, because they have
had at least 25 percent of their earnings in the last 5 years dependent
on defense business, as they seek to make the transition from defense-
dependent businesses to other commercial applications, the DELTA
program is instrumental in helping them make that kind of a transition.
It is important to understand also that the Small Business
Administration is one of the few agencies or departments in the
Government that almost pays for itself, helping budding entrepreneurs
and small businessmen and women, who are the underpinning of the
American economy. This agency does a tremendous job, and I appreciate
the committee's special attention to this DELTA program.
As a former SBA regional administrator, I saw firsthand the important
work that is undertaken by SBA. I appreciate the committee's work in
making sure that this is a bipartisan bill, one that seeks to enhance
the good work done by the Small Business Administration.
Mr. LaFALCE. Mr. Speaker, I yield 2 minutes to the distinguished
gentleman from Illinois [Mr. Davis], an extremely valuable contributor
to the Committee on Small Business and the formation of this bill.
(Mr. DAVIS of Illinois asked and was given permission to revise and
extend his remarks.)
Mr. DAVIS of Illinois. Mr. Speaker, I rise in support of the
reauthorization of the SBA bill, but I also want to commend and
congratulate the gentleman from Missouri, Chairman Talent, and the
gentleman from New York, Mr. LaFalce, the ranking member, for their
exemplary leadership in bringing this legislation to the floor.
I also want to acknowledge the strong presence of the gentlewoman
from New York [Ms. Velazquez] in making sure that the 8(a) procurement
program is protected at all costs.
I also would extend my appreciation to Administrator Alvarez for her
sensitivity and professionalism and hard work to make sure that areas
of conflict were worked out.
But I am most pleased because this legislation, in addition to all of
those excellent programs that we have already heard about, the micro
lending program, the 8(a) program, the 504 program, all of them are
excellent. But in addition, we now have a new concept, something called
HUBZones, which are designed to bring additional resources to hard-
pressed, severely depressed urban and rural communities throughout
America, areas that, no matter what is said, none of the other programs
has been able to do as much as there is that is needed to be done.
So I am hoping that with this new addition, we will see additional
improvements, additional resources. It is a great program, and I am
very pleased to lend my support to it and ask that all Members vote in
favor of it.
Mr. LaFALCE. Mr. Speaker, I yield 3 minutes to one of the most
distinguished freshmen members of the Committee on Small Business, the
gentleman from Rhode Island [Mr. Weygand].
(Mr. WEYGAND asked and was given permission to revise and extend his
remarks.)
Mr. WEYGAND. Mr. Speaker, I want to thank the gentleman from New
York, our ranking member [Mr. LaFalce], for his generosity and our
chairman for the great work the two of them have done. I think if
anyone could look at our committee and what they do, they would see
this great bipartisan effort that I think really does serve not only
the Members very well, but also the people of the country.
I am here to support Senate version 1139 because I think this is good
for my State of Rhode Island, the small State of Rhode Island, but also
good for other businesses throughout this country.
This bill authorizes SBA and its programs which will provide access
to capital and services that might not be available to many of the
small businesses throughout this great country.
I am a former small business owner, and I remember when I started my
business in the basement of my house 15 years ago. I went down to the
SBA because I knew I was a good landscape architect, I knew I could
provide the services that were necessary, but I thought maybe I could
extend my market area into maybe some Federal programs.
So I went down there 15 years ago, and when I came back, they had
piled me down with literature and propaganda that most small business
owners cannot even take the time to read, and I immediately threw it in
the basket. My first impression of the SBA was a very negative one.
That is not so today. Today in Rhode Island, the SBA has done
tremendous deeds to improve the small business climate of our State.
Just over the last 3 years, they have more than doubled the number of
loans in the 504 and the 7(a) program. Indeed, they have also done some
things that we did not think were possible. Loans and assistance to
minorities and to veterans and to women have more than doubled and
tripled. Indeed, over one-third of all the loans given out in the State
of Rhode Island are to these three groups.
The impact of small business to Rhode Island's economy cannot be
overstated. In our State, over 97 percent of all the businesses are
small businesses. Along with the loan programs, though, SBA provides
services to assist business owners in becoming or remaining successful.
Once a loan has been given to a business, they make sure and follow
through like caseworkers to be sure that businesses are fulfilling
their obligation and doing well.
I also want to raise some concern that my colleagues have raised
already about the HUB program. The HUBZone program is very similar to
what we in many States call enterprise zones.
HUBZones and enterprise zones can have a very dark side. People can
play shell games within enterprise zones, and in our State of Rhode
Island they did just that. Businesses from outside of the enterprise
zone moved in. They simply laid off other workers and hired them back
and got the tax benefits and the contracts that were provided for
people within the enterprise zone.
My concern is that under this provision of HUBZone, that we may
indeed have the same kind of problems that we in Rhode Island had.
Continued oversight and vigilance about this HUBZone program is
extremely necessary. I know all of my colleagues are looking to
Administrator Alvarez to be sure that she does not diminish the 8(a)
program and sacrifice moneys because of the HUB program. I support this
legislation and ask my colleagues to do the same.
Mr. Speaker, I rise in support of S. 1139, a bill to reauthorize
small business programs. 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 to 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.
In particular, there have been dramatic improvements in access to
capital for women, minorities, and veterans in my district. 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.
Nearly 35 percent of all approved SBA loans in Rhode Island, are going
to these three groups.
I must express some concern over one provision in this bill. The
HUBZone provision included in this bill did not come before the House
Small Business committee, and we did not have the opportunity to hold
hearings or study the program and its potential impact on small
businesses in our districts. I am concerned that there may be the
unintended consequence of negatively impacting minority small
businesses and 8(a) firms. It is my hope that we will be able to work
with the SBA and small business groups to ensure that we continue to
expand opportunities for minorities.
[[Page H10503]]
I cannot overstate the importance 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.
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, I am happy to yield 3 minutes to our last
speaker on this side of the aisle, the gentleman from Montana [Mr.
Hill], an outstanding member of the committee.
Mr. HILL. Mr. Speaker, I thank the gentleman for yielding me this
time.
Mr. Speaker, I rise today in strong support of Senate bill 1139, the
Small Business Reauthorization Act of 1997, and I would like to first
thank the gentleman from Missouri Chairman Talent and the gentleman
from New York Ranking Member LaFalce, and especially the staff for
their hard work in getting this important legislation to the floor and
getting it passed. Without their tireless dedication and commitment to
America's small businesses and the people who work in those small
businesses, this vital authorization would not today be a reality.
Mr. Speaker, small businesses fuel our Nation's economy, and the role
of Congress is an appropriate role, should be to support and encourage
entrepreneurship.
{time} 1700
I believe that this bill achieves this objective. We must continue to
promote our economic growth throughout States like mine, Montana, by
helping make them more competitive within markets and outside the
United States.
I do want to point out two provisions in this bill that are extremely
important to Montana. The first is the Small Business Technology
Transfer program that earlier speakers talked about. I was especially
pleased to see that my amendment was in the final bill. This provision
will assist those 23 States that together receive fewer total SBA small
business innovation research awards than the fifth-ranking State by
itself. It will help our States receive more awards.
States like Montana have large numbers of small research and
development businesses, and many of these businesses lack the resources
for competing for small business innovation research grants. With my
amendment, the playing field will be leveled by giving assistance to
these businesses in applying for these awards while establishing
performance goals to them.
Second is a provision in the Small Business Investment Company that
addresses underserved areas like Montana. Montana is one of the few
States that has never had a licensed Small Business Investment Company.
With this provision, it will enable Montana to apply and hopefully
qualify for this much-needed license. Approximately 98 percent of
Montana's businesses are considered small businesses by definition. As
a matter of fact, Mr. Speaker, 95 percent of the people in Montana work
for a business that employs less than 50 employees. An SBAC license in
the State of Montana will provide the necessary capital to fuel
Montana's small business and small business growth.
Mr. Speaker, I urge my colleagues to vote for this bill.
Mr. Speaker, I rise today in strong support of S. 1139, the Small
Business Reauthorization Act of 1997. I first would like to thank
Chairman Talent, Ranking Member LaFalce and especially the staff, for
their hard work in getting this very important legislation to the
floor. Without their tireless dedication and commitment to America's
small businesses, this vital authorization would not have become a
reality.
Mr. Speaker, small businesses fuel our Nation's economy. The role of
Congress should be to support and encourage entrepreneurship. And I
believe that this bill achieves this objective. We must continue to
promote economic growth throughout States like Montana, making them
competitive in markets within and outside the United States.
I would like to point out two provisions in the bill that are
extremely important to Montana. First is the Small Business Technology
Transfer program. I was especially pleased to see that my amendment was
in the final bill. This provision will assist those 23 States that
together receive fewer total Small Business Innovation Research [SBIR]
awards than the fifth ranking State by itself. States like Montana have
large numbers of small Research and Development businesses, and many of
these businesses lack the resources to compete for SBIR awards. With my
amendment, the playing field will be leveled by giving assistance to
these businesses in applying for the awards, while establishing
performance goals.
Second is a provision in the Small Business Investment Company [SBIC]
that addresses underserved areas like Montana. Montana is one of the
few States that have never had a licensed SBIC. With this provision, it
will enable Montana to apply and hopefully qualify for this much needed
license. Approximately 98 percent of Montana's businesses are
considered small businesses by definition, and an SBIC in the State
will provide the necessary capital to fuel Montana's small businesses.
Mr. Speaker, I urge my colleagues to vote for the bill.
Mr. LaFALCE. Mr. Speaker, I yield 2 minutes to the distinguished
gentleman from Texas [Mr. Bentsen], perhaps the House's most
knowledgeable Member on questions of securitization.
Mr. BENTSEN. Mr. Speaker, I thank the gentleman for yielding me this
time.
Mr. Speaker, it is late in the session. We are talking about the SBA
reauthorization. It is like the great American philosopher who said it
is deja vu all over again, and now we are once again trying to get to
the issue of what is going to happen with securitization.
It was a year ago that the Committee on Small Business in both the
House and the other body attempted to deal with this issue. We saw some
language that was never passed, and now we have the Small Business
Administration also trying to deal with this issue.
This all began in part because of an attempt on the part of both
committees to try and level the playing field between banks and
nonbanks in the securitization of the unguaranteed portion of 7(a)
loans, which I think all of us support and does create capital. But
there have been attempts, I think, to rigidly try and define the
structure of that securitization which could, in fact, reduce the
amount of capital that is available. I would like to engage in a brief
colloquy with the ranking member and the chairman, if I might.
It is my understanding that the current bill we are considering today
includes no language instructing SBA on how to define any credit test
to securitization. My concern continues to be that the SBA may come up
with a definition which is too rigid, on the one hand, which tries to
have a one-size-fits-all for both banks and nonbanks, and confuses
market concentration with creditworthiness, which is what I believe
both the ranking member and the chairman's intent was when we looked at
this issue in the last Congress.
Mr. LaFALCE. Mr. Speaker, will the gentleman yield?
Mr. BENTSEN. I yield to the gentleman from New York.
Mr. LaFALCE. I concur with the remarks of the gentleman from Texas
completely.
Mr. TALENT. Mr. Speaker, will the gentleman yield?
Mr. BENTSEN. I yield to the gentleman from Missouri.
Mr. TALENT. Mr. Speaker, I do also, and certainly would hope that the
agency will move toward as much securitization as financial soundness
permits. That is what the committee has been working to accomplish.
Mr. BENTSEN. Mr. Speaker, I thank the chairman and ranking member.
I rise in support of the bill, and I appreciate the hard work that
they have done.
Mr. LaFALCE. Mr. Speaker, I yield 30 seconds to the gentlewoman from
Texas [Ms. Jackson-Lee].
[[Page H10504]]
(Ms. JACKSON-LEE of Texas asked and was given permission to revise
and extend her remarks.)
Ms. JACKSON-LEE of Texas. Mr. Speaker, I thank the ranking member and
the chairman for the very strong support of small businesses.
Let me say that I rise to support this authorization act because of
the Microloan Program, the supporting of the National Women's Business
Council Program, and as well the fact that we are not disturbing the
8(a) programs that help create jobs in America. Let me compliment my
own small business regional office and Mr. Wilson, and I hope that we
will continue to stand on the side of small businesses.
Mr. TALENT. Mr. Speaker, I would be happy to yield if the gentleman
wants a little more time. I yield 1 minute to the gentleman from New
York [Mr. LaFalce].
Mr. LaFALCE. Mr. Speaker, I would like to take this time to thank the
chairman of our committee, the gentleman from Missouri [Mr. Talent],
for all of the kindnesses that he has shown me in his position. He has
proven himself to be an excellent chairman, certainly one that has been
a pleasure for me to work with. He has the ability to be both gentle,
cooperative and firm all at the same time, and I am sure that he is
going to go on to great things in life, not only in the House of
Representatives, but perhaps even higher.
I also want to extol our staff. My tremendous staff, both Tom Powers,
Jeanne Roslanowick and others, but also the majority staff. They have
tremendous expertise and dedication; they have worked together as one
staff in order to produce the best possible bill, regardless of
politics, regardless of partisanship. So it has been a pleasure for me
to work with all of them on this reauthorization bill.
Mr. TALENT. Mr. Speaker, in closing, I yield myself such time as I
may consume.
I want to echo the remarks of the gentleman from New York [Mr.
LaFalce], except in reverse. It has been a great pleasure this year to
work with him. We all know that the gentleman knows how to be firm; he
also does know how to be, and has been consistently, cooperative, and I
have been very grateful to him for that.
Also, I want to recognize the great depth of his knowledge in this
field. We are passing, I hope and believe today, yet another
reauthorization bill, and it will reflect yet again his great influence
and his great expertise in this area.
I want to thank also the members on both sides of the committee. The
House has heard many of them today, and I am proud to chair a committee
with so many committed and dedicated individuals.
Mr. Speaker, this legislation is the product of bipartisan and
bicameral efforts to reauthorize the Small Business Administration
through fiscal year 2000. It reflects the efforts of many individuals
and committees and their staffs. I would like to thank the gentleman
from Wisconsin [Mr. Sensenbrenner], the chairman of the Committee on
Science; and the gentleman from California [Mr. Brown], his ranking
member, for their work on H.R. 2429, which has in large part become
section 501 of this legislation. I would also like to express my
appreciation to their staff who worked on this.
I would also like to thank the gentleman from Arizona [Mr. Stump],
the chairman of the Committee on Veterans' Affairs, and the gentleman
from New York [Mr. Solomon], the chairman of the Committee on Rules,
along with their staffs, for their help in working on title VII of this
legislation. As I have already said, I want to extend my thanks and
appreciation to the gentleman from New York [Mr. LaFalce], the
committee's ranking member, for his help in crafting this legislation.
Finally, I would like to acknowledge the Committee on Small Business
staff who worked on this bill: Emily Murphy, Mary McKenzie, Kiki Kless,
Paul Denham, Charles ``Tee'' Rowe, and Harry Katrichis for the
majority, and Jeanne Roslanowick, Steve McSpadden and Tom Powers for
the minority.
I urge my colleagues, in closing, to vote for this important piece of
legislation.
Mrs. MINK of Hawaii. Mr. Speaker, I rise today to express my concerns
regarding S. 1139, the Small Business Authorization Act. I will vote
for this bill because it is essential for the continuation of programs
which assist small businesses in this country. However, I have serious
concerns regarding a specific provision included by the Senate, which
could impact the current 8(a) program for minority- and women-owned
businesses.
S. 1139 establishes a new program to increase access to Federal
contracts for small businesses in economically distressed areas. While
the goal of this new HUBZone program seems laudable enough, I have
strong reservations regarding its potential impact on the existing and
successful 8(a) program for minority- and women-owned businesses.
It is no secret that many in the majority want to get rid of the 8(a)
program and other forms of affirmative action. I fear that the
establishment of these HUBZones is a backdoor attempt to weaken 8(a)
and affirmative action.
The 8(a) program is specifically targeted to assist businesses owned
by minorities and women, which have historically had difficulty in
obtaining contracts and subcontracts from the Federal Government. The
new HUBZone program would be open to all small businesses within these
zones, not just those which are disadvantaged in any way. And these
businesses within the HUBZones will compete with the 8(a) businesses
for the limited number of Federal contracts.
Also of concern is that under this provision Federal agencies would
be allowed to use sole-source contracts in HUBZones which cuts out the
competitive nature of Federal contracting altogether, and further
erodes opportunities for 8(a) businesses.
The Senate has failed to provide enough funding for the
administration of this new program. The Congressional Budget Office
estimates that $12 million is needed annually to implement the HUBZone
program. The bill provides only $1.2 million. This raises concerns
regarding adequate oversight and evaluation of this new program. If we
are to accurately assess whether this new program is affecting the 8(a)
program we need to have the appropriate monitoring systems in place.
The lack of funding causes concerns in this regard.
Mr. Speaker, I have discussed these concerns with the Administrator
of the Small Business Administration, who assured me that the
Administration will closely monitor this new program and its impact on
the 8(a) program. She also indicated that in administering the HUBZone
program, they would take steps necessary to assure that 8(a) was not
adversely impacted.
Mr. Speaker, had this bill come up under regular order, and not under
the expedited suspension procedures we would have had the opportunity
to address many of our concerns through the amendment process. As we
are in the last 2 days of the congressional session this year, I
understand the need to utilize expedited procedures to assure that
critical small business programs are funded.
Therefore, I will support this bill. I note for the Record that I
will watch closely the development of this program and monitor its
impact on the 8(a) minority- and women-owned business program.
Mr. TALENT. Mr. Speaker, I yield back the balance of my time.
The SPEAKER pro tempore. All time has expired.
The question is on the motion offered by the gentleman from Missouri
[Mr. Talent] that the House suspend the rules and concur in the Senate
amendment to the House amendment to S. 1139.
The question was taken; and (two-thirds having voted in favor
thereof) the rules were suspended and the Senate amendment to the House
amendment was concurred in.
A motion to reconsider was laid on the table.
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