[Congressional Record Volume 146, Number 120 (Monday, October 2, 2000)]
[Senate]
[Pages S9631-S9642]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




  SMALL BUSINESS INNOVATION RESEARCH PROGRAM AUTHORIZATION ACT OF 2000

  Mr. KYL. Mr. President, I ask unanimous consent that the Chair lay 
before the Senate a message from the House of Representatives on the 
bill, H.R. 2392, an act to amend the Small Business Act to extend the 
authorization for the Small Business Innovation Research program, and 
for other purposes.
  There being no objection, the Presiding Officer laid before the 
Senate the following message from the House of Representatives:

       Resolved, That the House agree to the amendment of the 
     Senate to the bill (H.R. 2392) entitled ``An Act to amend the 
     Small Business Act to extend the authorization for the Small 
     Business Innovation Research Program, and for other 
     purposes,'' with the following amendment:

     SECTION 1. TABLE OF CONTENTS.

       The table of contents for this Act is as follows:

Sec. 1. Table of contents.

          TITLE I--SMALL BUSINESS INNOVATION RESEARCH PROGRAM

Sec. 101. Short title.
Sec. 102. Findings.
Sec. 103. Extension of SBIR program.
Sec. 104. Annual report.
Sec. 105. Third phase assistance.
Sec. 106. Report on programs for annual performance plan.
Sec. 107. Output and outcome data.
Sec. 108. National Research Council reports.
Sec. 109. Federal agency expenditures for the SBIR program.
Sec. 110. Policy directive modifications.
Sec. 111. Federal and State technology partnership program.
Sec. 112. Mentoring networks.
Sec. 113. Simplified reporting requirements.
Sec. 114. Rural outreach program extension.

                TITLE II--GENERAL BUSINESS LOAN PROGRAM

Sec. 201. Short title.
Sec. 202. Levels of participation.
Sec. 203. Loan amounts.
Sec. 204. Interest on defaulted loans.
Sec. 205. Prepayment of loans.
Sec. 206. Guarantee fees.
Sec. 207. Lease terms.

            TITLE III--CERTIFIED DEVELOPMENT COMPANY PROGRAM

Sec. 301. Short title.
Sec. 302. Women-owned businesses.
Sec. 303. Maximum debenture size.
Sec. 304. Fees.
Sec. 305. Premier certified lenders program.
Sec. 306. Sale of certain defaulted loans.
Sec. 307. Loan liquidation.

   TITLE IV--CORRECTIONS TO THE SMALL BUSINESS INVESTMENT ACT OF 1958

Sec. 401. Short title.
Sec. 402. Definitions.
Sec. 403. Investment in small business investment companies.
Sec. 404. Subsidy fees.
Sec. 405. Distributions.
Sec. 406. Conforming amendment.

          TITLE V--REAUTHORIZATION OF SMALL BUSINESS PROGRAMS

Sec. 501. Short title.
Sec. 502. Reauthorization of small business programs.
Sec. 503. Additional reauthorizations.

                   TITLE VI--MISCELLANEOUS PROVISIONS

Sec. 601. Loan application processing.
Sec. 602. Application of ownership requirements.
Sec. 603. Eligibility for HUBZone program.
Sec. 604. Subcontracting preference for veterans.
Sec. 605. Small business development center program funding.
Sec. 606. Surety bonds.

          TITLE I--SMALL BUSINESS INNOVATION RESEARCH PROGRAM

     SEC. 101. SHORT TITLE.

       (a) Short Title.--This title may be cited as the ``Small 
     Business Innovation Research Program Reauthorization Act of 
     2000''.

     SEC. 102. FINDINGS.

       Congress finds that--
       (1) the small business innovation research program 
     established under the Small Business Innovation Development 
     Act of 1982, and reauthorized by the Small Business Research 
     and Development Enhancement Act of 1992 (in this Act referred 
     to as the ``SBIR program'') is highly successful in involving 
     small businesses in federally funded research and 
     development;
       (2) the SBIR program made the cost-effective and unique 
     research and development capabilities possessed by the small 
     businesses of the Nation available to Federal agencies and 
     departments;
       (3) the innovative goods and services developed by small 
     businesses that participated in the SBIR program have 
     produced innovations of critical importance in a wide variety 
     of high-technology fields, including biology, medicine, 
     education, and defense;
       (4) the SBIR program is a catalyst in the promotion of 
     research and development, the commercialization of innovative 
     technology, the development of new products and services, and 
     the continued excellence of this Nation's high-technology 
     industries; and
       (5) the continuation of the SBIR program will provide 
     expanded opportunities for one of the Nation's vital 
     resources, its small businesses, will foster invention, 
     research, and technology, will create jobs, and will increase 
     this Nation's competitiveness in international markets.

     SEC. 103. EXTENSION OF SBIR PROGRAM.

       Section 9(m) of the Small Business Act (15 U.S.C. 638(m)) 
     is amended to read as follows:
       ``(m) Termination.--The authorization to carry out the 
     Small Business Innovation Research Program established under 
     this section shall terminate on September 30, 2008.''.

     SEC. 104. ANNUAL REPORT.

       Section 9(b)(7) of the Small Business Act (15 U.S.C. 
     638(b)(7)) is amended by striking ``and the Committee on 
     Small Business of the House of Representatives'' and 
     inserting ``, and to the Committee on Science and the 
     Committee on Small Business of the House of 
     Representatives,''.

     SEC. 105. THIRD PHASE ASSISTANCE.

       Section 9(e)(4)(C)(i) of the Small Business Act (15 U.S.C. 
     638(e)(4)(C)(i)) is amended by striking ``; and'' and 
     inserting ``; or''.

[[Page S9632]]

     SEC. 106. REPORT ON PROGRAMS FOR ANNUAL PERFORMANCE PLAN.

       Section 9(g) of the Small Business Act (15 U.S.C. 638(g)) 
     is amended--
       (1) in paragraph (7), by striking ``and'' at the end;
       (2) in paragraph (8), by striking the period at the end and 
     inserting a semicolon; and
       (3) by adding at the end the following new paragraph:
       ``(9) 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 SBIR 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; and''.

     SEC. 107. OUTPUT AND OUTCOME DATA.

       (a) Collection.--Section 9(g) of the Small Business Act (15 
     U.S.C. 638(g)), as amended by section 106 of this Act, is 
     further amended by adding at the end the following new 
     paragraph:
       ``(10) collect, and maintain in a common format in 
     accordance with subsection (v), such information from 
     awardees as is necessary to assess the SBIR program, 
     including information necessary to maintain the database 
     described in subsection (k).''.
       (b) Report to Congress.--Section 9(b)(7) of the Small 
     Business Act (15 U.S.C. 638(b)(7)), as amended by section 104 
     of this Act, is further amended by inserting before the 
     period at the end ``, including the data on output and 
     outcomes collected pursuant to subsections (g)(10) and 
     (o)(9), and a description of the extent to which Federal 
     agencies are providing in a timely manner information needed 
     to maintain the database described in subsection (k)''.
       (c) Database.--Section 9(k) of the Small Business Act (15 
     U.S.C. 638(k)) is amended to read as follows:
       ``(k) Database.--
       ``(1) Public database.--Not later than 180 days after the 
     date of the enactment of the Small Business Innovation 
     Research Program Reauthorization Act of 2000, the 
     Administrator shall develop, maintain, and make available to 
     the public a searchable, up-to-date, electronic database that 
     includes--
       ``(A) the name, size, location, and an identifying number 
     assigned by the Administrator, of each small business concern 
     that has received a first phase or second phase SBIR award 
     from a Federal agency;
       ``(B) a description of each first phase or second phase 
     SBIR award received by that small business concern, 
     including--
       ``(i) an abstract of the project funded by the award, 
     excluding any proprietary information so identified by the 
     small business concern;
       ``(ii) the Federal agency making the award; and
       ``(iii) the date and amount of the award;
       ``(C) an identification of any business concern or 
     subsidiary established for the commercial application of a 
     product or service for which an SBIR award is made; and
       ``(D) information regarding mentors and Mentoring Networks, 
     as required by section 35(d).
       ``(2) Government database.--Not later than 180 days after 
     the date of the enactment of the Small Business Innovation 
     Research Program Reauthorization Act of 2000, the 
     Administrator, in consultation with Federal agencies required 
     to have an SBIR program pursuant to subsection (f)(1), shall 
     develop and maintain a database to be used solely for SBIR 
     program evaluation that--
       ``(A) contains for each second phase award made by a 
     Federal agency--
       ``(i) information collected in accordance with paragraph 
     (3) on revenue from the sale of new products or services 
     resulting from the research conducted under the award;
       ``(ii) information collected in accordance with paragraph 
     (3) on additional investment from any source, other than 
     first phase or second phase SBIR or STTR awards, to further 
     the research and development conducted under the award; and
       ``(iii) any other information received in connection with 
     the award that the Administrator, in conjunction with the 
     SBIR program managers of Federal agencies, considers relevant 
     and appropriate;
       ``(B) includes any narrative information that a small 
     business concern receiving a second phase award voluntarily 
     submits to further describe the outputs and outcomes of its 
     awards;
       ``(C) includes for each applicant for a first phase or 
     second phase award that does not receive such an award--
       ``(i) the name, size, and location, and an identifying 
     number assigned by the Administration;
       ``(ii) an abstract of the project; and
       ``(iii) the Federal agency to which the application was 
     made;
       ``(D) includes any other data collected by or available to 
     any Federal agency that such agency considers may be useful 
     for SBIR program evaluation; and
       ``(E) is available for use solely for program evaluation 
     purposes by the Federal Government or, in accordance with 
     policy directives issued by the Administration, by other 
     authorized persons who are subject to a use and nondisclosure 
     agreement with the Federal Government covering the use of the 
     database.
       ``(3) Updating information for database.--
       ``(A) In general.--A small business concern applying for a 
     second phase award under this section shall be required to 
     update information in the database established under this 
     subsection for any prior second phase award received by that 
     small business concern. In complying with this paragraph, a 
     small business concern may apportion sales or additional 
     investment information relating to more than one second phase 
     award among those awards, if it notes the apportionment for 
     each award.
       ``(B) Annual updates upon termination.--A small business 
     concern receiving a second phase award under this section 
     shall--
       ``(i) update information in the database concerning that 
     award at the termination of the award period; and
       ``(ii) be requested to voluntarily update such information 
     annually thereafter for a period of 5 years.
       ``(4) Protection of information.--Information provided 
     under paragraph (2) shall be considered privileged and 
     confidential and not subject to disclosure pursuant to 
     section 552 of title 5, United States Code.
       ``(5) Rule of construction.--Inclusion of information in 
     the database under this subsection shall not be considered to 
     be publication for purposes of subsection (a) or (b) of 
     section 102 of title 35, United States Code.''.

     SEC. 108. NATIONAL RESEARCH COUNCIL REPORTS.

       (a) Study and Recommendations.--The head of each agency 
     with a budget of more than $50,000,000 for its SBIR program 
     for fiscal year 1999, in consultation with the Small Business 
     Administration, shall, not later than 6 months after the date 
     of the enactment of this Act, cooperatively enter into an 
     agreement with the National Academy of Sciences for the 
     National Research Council to--
       (1) conduct a comprehensive study of how the SBIR program 
     has stimulated technological innovation and used small 
     businesses to meet Federal research and development needs, 
     including--
       (A) a review of the value to the Federal research agencies 
     of the research projects being conducted under the SBIR 
     program, and of the quality of research being conducted by 
     small businesses participating under the program, including a 
     comparison of the value of projects conducted under the SBIR 
     program to those funded by other Federal research and 
     development expenditures;
       (B) to the extent practicable, an evaluation of the 
     economic benefits achieved by the SBIR program, including the 
     economic rate of return, and a comparison of the economic 
     benefits, including the economic rate of return, achieved by 
     the SBIR program with the economic benefits, including the 
     economic rate of return, of other Federal research and 
     development expenditures;
       (C) an evaluation of the noneconomic benefits achieved by 
     the SBIR program over the life of the program;
       (D) a comparison of the allocation for fiscal year 2000 of 
     Federal research and development funds to small businesses 
     with such allocation for fiscal year 1983, and an analysis of 
     the factors that have contributed to such allocation; and
       (E) an analysis of whether Federal agencies, in fulfilling 
     their procurement needs, are making sufficient effort to use 
     small businesses that have completed a second phase award 
     under the SBIR program; and
       (2) make recommendations with respect to--
       (A) measures of outcomes for strategic plans submitted 
     under section 306 of title 5, United States Code, and 
     performance plans submitted under section 1115 of title 31, 
     United States Code, of each Federal agency participating in 
     the SBIR program;
       (B) whether companies who can demonstrate project 
     feasibility, but who have not received a first phase award, 
     should be eligible for second phase awards, and the potential 
     impact of such awards on the competitive selection process of 
     the program;
       (C) whether the Federal Government should be permitted to 
     recoup some or all of its expenses if a controlling interest 
     in a company receiving an SBIR award is sold to a foreign 
     company or to a company that is not a small business concern;
       (D) how to increase the use by the Federal Government in 
     its programs and procurements of technology-oriented small 
     businesses; and
       (E) improvements to the SBIR program, if any are considered 
     appropriate.
       (b) Participation by Small Business.--
       (1) In general.--In a manner consistent with law and with 
     National Research Council study guidelines and procedures, 
     knowledgeable individuals from the small business community 
     with experience in the SBIR program shall be included--
       (A) in any panel established by the National Research 
     Council for the purpose of performing the study conducted 
     under this section; and
       (B) among those who are asked by the National Research 
     Council to peer review the study.
       (2) Consultation.--To ensure that the concerns of small 
     business are appropriately considered under this subsection, 
     the National Research Council shall consult with and consider 
     the views of the Office of Technology and the Office of 
     Advocacy of the Small Business Administration and other 
     interested parties, including entities, organizations, and 
     individuals actively engaged in enhancing or developing the 
     technological capabilities of small business concerns.
       (c) Progress Reports.--The National Research Council shall 
     provide semiannual progress reports on the study conducted 
     under this section to the Committee on Science and the 
     Committee on Small Business of the House of Representatives, 
     and to the Committee on Small Business of the Senate.
       (d) Report.--The National Research Council shall transmit 
     to the heads of agencies entering into an agreement under 
     this section and to the Committee on Science and the 
     Committee on Small Business of the House of Representatives, 
     and to the Committee on Small Business of the Senate--
       (1) not later than 3 years after the date of the enactment 
     of this Act, a report including the results of the study 
     conducted under subsection (a)(1) and recommendations made 
     under subsection (a)(2); and
       (2) not later than 6 years after that date of the 
     enactment, an update of such report.

[[Page S9633]]

     SEC. 109. FEDERAL AGENCY EXPENDITURES FOR THE SBIR PROGRAM.

       Section 9(i) of the Small Business Act (15 U.S.C. 638(i)) 
     is amended--
       (1) by striking ``(i) Each Federal'' and inserting the 
     following:
       ``(i) Annual Reporting.--
       ``(1) In general.--Each Federal''; and
       (2) by adding at the end the following:
       ``(2) Calculation of extramural budget.--
       ``(A) Methodology.--Not later than 4 months after the date 
     of the enactment of each appropriations Act for a Federal 
     agency required by this section to have an SBIR program, the 
     Federal agency shall submit to the Administrator a report, 
     which shall include a description of the methodology used for 
     calculating the amount of the extramural budget of that 
     Federal agency.
       ``(B) Administrator's analysis.--The Administrator shall 
     include an analysis of the methodology received from each 
     Federal agency referred to in subparagraph (A) in the report 
     required by subsection (b)(7).''.

     SEC. 110. POLICY DIRECTIVE MODIFICATIONS.

       Section 9(j) of the Small Business Act (15 U.S.C. 638(j)) 
     is amended by adding at the end the following:
       ``(3) Additional modifications.--Not later than 120 days 
     after the date of the enactment of the Small Business 
     Innovation Research Program Reauthorization Act of 2000, the 
     Administrator shall modify the policy directives issued 
     pursuant to this subsection--
       ``(A) to clarify that the rights provided for under 
     paragraph (2)(A) apply to all Federal funding awards under 
     this section, including the first phase (as described in 
     subsection (e)(4)(A)), the second phase (as described in 
     subsection (e)(4)(B)), and the third phase (as described in 
     subsection (e)(4)(C));
       ``(B) to provide for the requirement of a succinct 
     commercialization plan with each application for a second 
     phase award that is moving toward commercialization;
       ``(C) to require agencies to report to the Administration, 
     not less frequently than annually, all instances in which an 
     agency pursued research, development, or production of a 
     technology developed by a small business concern using an 
     award made under the SBIR program of that agency, and 
     determined that it was not practicable to enter into a 
     follow-on non-SBIR program funding agreement with the small 
     business concern, which report shall include, at a minimum--
       ``(i) the reasons why the follow-on funding agreement with 
     the small business concern was not practicable;
       ``(ii) the identity of the entity with which the agency 
     contracted to perform the research, development, or 
     production; and
       ``(iii) a description of the type of funding agreement 
     under which the research, development, or production was 
     obtained; and
       ``(D) to implement subsection (v), including establishing 
     standardized procedures for the provision of information 
     pursuant to subsection (k)(3).''.

     SEC. 111. FEDERAL AND STATE TECHNOLOGY PARTNERSHIP PROGRAM.

       (a) Findings.--Congress finds that--
       (1) programs to foster economic development among small 
     high-technology firms vary widely among the States;
       (2) States that do not aggressively support the development 
     of small high-technology firms, including participation by 
     small business concerns in the SBIR program, are at a 
     competitive disadvantage in establishing a business climate 
     that is conducive to technology development; and
       (3) building stronger national, State, and local support 
     for science and technology research in these disadvantaged 
     States will expand economic opportunities in the United 
     States, create jobs, and increase the competitiveness of the 
     United States in the world market.
       (b) Federal and State Technology Partnership Program.--The 
     Small Business Act (15 U.S.C. 631 et seq.) is amended--
       (1) by redesignating section 34 as section 36; and
       (2) by inserting after section 33 the following new 
     section:

     ``SEC. 34. FEDERAL AND STATE TECHNOLOGY PARTNERSHIP PROGRAM.

       ``(a) Definitions.--In this section and section 35, the 
     following definitions apply:
       ``(1) Applicant.--The term `applicant' means an entity, 
     organization, or individual that submits a proposal for an 
     award or a cooperative agreement under this section.
       ``(2) Business advice and counseling.--The term `business 
     advice and counseling' means providing advice and assistance 
     on matters described in section 35(c)(2)(B) to small business 
     concerns to guide them through the SBIR and STTR program 
     process, from application to award and successful completion 
     of each phase of the program.
       ``(3) FAST program.--The term `FAST program' means the 
     Federal and State Technology Partnership Program established 
     under this section.
       ``(4) Mentor.--The term `mentor' means an individual 
     described in section 35(c)(2).
       ``(5) Mentoring network.--The term `Mentoring Network' 
     means an association, organization, coalition, or other 
     entity (including an individual) that meets the requirements 
     of section 35(c).
       ``(6) Recipient.--The term `recipient' means a person that 
     receives an award or becomes party to a cooperative agreement 
     under this section.
       ``(7) SBIR program.--The term `SBIR program' has the same 
     meaning as in section 9(e)(4).
       ``(8) State.--The term `State' means each of the several 
     States, the District of Columbia, the Commonwealth of Puerto 
     Rico, the Virgin Islands, Guam, and American Samoa.
       ``(9) STTR program.--The term `STTR program' has the same 
     meaning as in section 9(e)(6).
       ``(b) Establishment of Program.--The Administrator shall 
     establish a program to be known as the Federal and State 
     Technology Partnership Program, the purpose of which shall be 
     to strengthen the technological competitiveness of small 
     business concerns in the States.
       ``(c) Grants and Cooperative Agreements.--
       ``(1) Joint review.--In carrying out the FAST program under 
     this section, the Administrator and the SBIR program managers 
     at the National Science Foundation and the Department of 
     Defense shall jointly review proposals submitted by 
     applicants and may make awards or enter into cooperative 
     agreements under this section based on the factors for 
     consideration set forth in paragraph (2), in order to enhance 
     or develop in a State--
       ``(A) technology research and development by small business 
     concerns;
       ``(B) technology transfer from university research to 
     technology-based small business concerns;
       ``(C) technology deployment and diffusion benefiting small 
     business concerns;
       ``(D) the technological capabilities of small business 
     concerns through the establishment or operation of consortia 
     comprised of entities, organizations, or individuals, 
     including--
       ``(i) State and local development agencies and entities;
       ``(ii) representatives of technology-based small business 
     concerns;
       ``(iii) industries and emerging companies;
       ``(iv) universities; and
       ``(v) small business development centers; and
       ``(E) outreach, financial support, and technical assistance 
     to technology-based small business concerns participating in 
     or interested in participating in an SBIR program, including 
     initiatives--
       ``(i) to make grants or loans to companies to pay a portion 
     or all of the cost of developing SBIR proposals;
       ``(ii) to establish or operate a Mentoring Network within 
     the FAST program to provide business advice and counseling 
     that will assist small business concerns that have been 
     identified by FAST program participants, program managers of 
     participating SBIR agencies, the Administration, or other 
     entities that are knowledgeable about the SBIR and STTR 
     programs as good candidates for the SBIR and STTR programs, 
     and that would benefit from mentoring, in accordance with 
     section 35;
       ``(iii) to create or participate in a training program for 
     individuals providing SBIR outreach and assistance at the 
     State and local levels; and
       ``(iv) to encourage the commercialization of technology 
     developed through SBIR program funding.
       ``(2) Selection considerations.--In making awards or 
     entering into cooperative agreements under this section, the 
     Administrator and the SBIR program managers referred to in 
     paragraph (1)--
       ``(A) may only consider proposals by applicants that intend 
     to use a portion of the Federal assistance provided under 
     this section to provide outreach, financial support, or 
     technical assistance to technology-based small business 
     concerns participating in or interested in participating in 
     the SBIR program; and
       ``(B) shall consider, at a minimum--
       ``(i) whether the applicant has demonstrated that the 
     assistance to be provided would address unmet needs of small 
     business concerns in the community, and whether it is 
     important to use Federal funding for the proposed activities;
       ``(ii) whether the applicant has demonstrated that a need 
     exists to increase the number or success of small high-
     technology businesses in the State, as measured by the number 
     of first phase and second phase SBIR awards that have 
     historically been received by small business concerns in the 
     State;
       ``(iii) whether the projected costs of the proposed 
     activities are reasonable;
       ``(iv) whether the proposal integrates and coordinates the 
     proposed activities with other State and local programs 
     assisting small high-technology firms in the State; and
       ``(v) the manner in which the applicant will measure the 
     results of the activities to be conducted.
       ``(3) Proposal limit.--Not more than one proposal may be 
     submitted for inclusion in the FAST program under this 
     section to provide services in any one State in any 1 fiscal 
     year.
       ``(4) Process.--Proposals and applications for assistance 
     under this section shall be in such form and subject to such 
     procedures as the Administrator shall establish.
       ``(d) Cooperation and Coordination.--In carrying out the 
     FAST program under this section, the Administrator shall 
     cooperate and coordinate with--
       ``(1) Federal agencies required by section 9 to have an 
     SBIR program; and
       ``(2) entities, organizations, and individuals actively 
     engaged in enhancing or developing the technological 
     capabilities of small business concerns, including--
       ``(A) State and local development agencies and entities;
       ``(B) State committees established under the Experimental 
     Program to Stimulate Competitive Research of the National 
     Science Foundation (as established under section 113 of the 
     National Science Foundation Authorization Act of 1988 (42 
     U.S.C. 1862g));
       ``(C) State science and technology councils; and
       ``(D) representatives of technology-based small business 
     concerns.
       ``(e) Administrative Requirements.--
       ``(1) Competitive basis.--Awards and cooperative agreements 
     under this section shall be

[[Page S9634]]

     made or entered into, as applicable, on a competitive basis.
       ``(2) Matching requirements.--
       ``(A) In general.--The non-Federal share of the cost of an 
     activity (other than a planning activity) carried out using 
     an award or under a cooperative agreement under this section 
     shall be--
       ``(i) 50 cents for each Federal dollar, in the case of a 
     recipient that will serve small business concerns located in 
     one of the 18 States receiving the fewest SBIR first phase 
     awards (as described in section 9(e)(4)(A));
       ``(ii) except as provided in subparagraph (B), 1 dollar for 
     each Federal dollar, in the case of a recipient that will 
     serve small business concerns located in one of the 16 States 
     receiving the greatest number of such SBIR first phase 
     awards; and
       ``(iii) except as provided in subparagraph (B), 75 cents 
     for each Federal dollar, in the case of a recipient that will 
     serve small business concerns located in a State that is not 
     described in clause (i) or (ii) that is receiving such SBIR 
     first phase awards.
       ``(B) Low-income areas.--The non-Federal share of the cost 
     of the activity carried out using an award or under a 
     cooperative agreement under this section shall be 50 cents 
     for each Federal dollar that will be directly allocated by a 
     recipient described in subparagraph (A) to serve small 
     business concerns located in a qualified census tract, as 
     that term is defined in section 42(d)(5)(C)(ii) of the 
     Internal Revenue Code of 1986. Federal dollars not so 
     allocated by that recipient shall be subject to the matching 
     requirements of subparagraph (A).
       ``(C) Types of funding.--The non-Federal share of the cost 
     of an activity carried out by a recipient shall be comprised 
     of not less than 50 percent cash and not more than 50 percent 
     of indirect costs and in-kind contributions, except that no 
     such costs or contributions may be derived from funds from 
     any other Federal program.
       ``(D) Rankings.--For purposes of subparagraph (A), the 
     Administrator shall reevaluate the ranking of a State once 
     every 2 fiscal years, beginning with fiscal year 2001, based 
     on the most recent statistics compiled by the Administrator.
       ``(3) Duration.--Awards may be made or cooperative 
     agreements entered into under this section for multiple 
     years, not to exceed 5 years in total.
       ``(f) Reports.--
       ``(1) Initial report.--Not later than 120 days after the 
     date of the enactment of the Small Business Innovation 
     Research Program Reauthorization Act of 2000, the 
     Administrator shall prepare and submit 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 a report, which shall include, with respect 
     to the FAST program, including Mentoring Networks--
       ``(A) a description of the structure and procedures of the 
     program;
       ``(B) a management plan for the program; and
       ``(C) a description of the merit-based review process to be 
     used in the program.
       ``(2) Annual reports.--The Administrator shall submit an 
     annual report 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 regarding--
       ``(A) the number and amount of awards provided and 
     cooperative agreements entered into under the FAST program 
     during the preceding year;
       ``(B) a list of recipients under this section, including 
     their location and the activities being performed with the 
     awards made or under the cooperative agreements entered into; 
     and
       ``(C) the Mentoring Networks and the mentoring database, as 
     provided for under section 35, including--
       ``(i) the status of the inclusion of mentoring information 
     in the database required by section 9(k); and
       ``(ii) the status of the implementation and description of 
     the usage of the Mentoring Networks.
       ``(g) Reviews by Inspector General.--
       ``(1) In general.--The Inspector General of the 
     Administration shall conduct a review of--
       ``(A) the extent to which recipients under the FAST program 
     are measuring the performance of the activities being 
     conducted and the results of such measurements; and
       ``(B) the overall management and effectiveness of the FAST 
     program.
       ``(2) Report.--During the first quarter of fiscal year 
     2004, the Inspector General of the Administration shall 
     submit a report 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 on the review 
     conducted under paragraph (1).
       ``(h) Program Levels.--
       ``(1) In general.--There is authorized to be appropriated 
     to carry out the FAST program, including Mentoring Networks, 
     under this section and section 35, $10,000,000 for each of 
     fiscal years 2001 through 2005.
       ``(2) Mentoring database.--Of the total amount made 
     available under paragraph (1) for fiscal years 2001 through 
     2005, a reasonable amount, not to exceed a total of $500,000, 
     may be used by the Administration to carry out section 35(d).
       ``(i) Termination.--The authority to carry out the FAST 
     program under this section shall terminate on September 30, 
     2005.''.
       (c) Coordination of Technology Development Programs.--
     Section 9 of the Small Business Act (15 U.S.C. 638) is 
     amended by adding at the end the following:
       ``(u) Coordination of Technology Development Programs.--
       ``(1) Definition of technology development program.--In 
     this subsection, the term `technology development program' 
     means--
       ``(A) the Experimental Program to Stimulate Competitive 
     Research of the National Science Foundation, as established 
     under section 113 of the National Science Foundation 
     Authorization Act of 1988 (42 U.S.C. 1862g);
       ``(B) the Defense Experimental Program to Stimulate 
     Competitive Research of the Department of Defense;
       ``(C) the Experimental Program to Stimulate Competitive 
     Research of the Department of Energy;
       ``(D) the Experimental Program to Stimulate Competitive 
     Research of the Environmental Protection Agency;
       ``(E) the Experimental Program to Stimulate Competitive 
     Research of the National Aeronautics and Space 
     Administration;
       ``(F) the Institutional Development Award Program of the 
     National Institutes of Health; and
       ``(G) the National Research Initiative Competitive Grants 
     Program of the Department of Agriculture.
       ``(2) Coordination requirements.--Each Federal agency that 
     is subject to subsection (f) and that has established a 
     technology development program may, in each fiscal year, 
     review for funding under that technology development 
     program--
       ``(A) any proposal to provide outreach and assistance to 
     one or more small business concerns interested in 
     participating in the SBIR program, including any proposal to 
     make a grant or loan to a company to pay a portion or all of 
     the cost of developing an SBIR proposal, from an entity, 
     organization, or individual located in--
       ``(i) a State that is eligible to participate in that 
     program; or
       ``(ii) a State described in paragraph (3); or
       ``(B) any proposal for the first phase of the SBIR program, 
     if the proposal, though meritorious, is not funded through 
     the SBIR program for that fiscal year due to funding 
     restraints, from a small business concern located in--
       ``(i) a State that is eligible to participate in a 
     technology development program; or
       ``(ii) a State described in paragraph (3).
       ``(3) Additionally eligible state.--A State referred to in 
     subparagraph (A)(ii) or (B)(ii) of paragraph (2) is a State 
     in which the total value of contracts awarded to small 
     business concerns under all SBIR programs is less than the 
     total value of contracts awarded to small business concerns 
     in a majority of other States, as determined by the 
     Administrator in biennial fiscal years, beginning with fiscal 
     year 2000, based on the most recent statistics compiled by 
     the Administrator.''.

     SEC. 112. MENTORING NETWORKS.

       The Small Business Act (15 U.S.C. 631 et seq.) is amended 
     by inserting after section 34, as added by section 111(b)(2) 
     of this Act, the following new section:

     ``SEC. 35. MENTORING NETWORKS.

       ``(a) Findings.--Congress finds that--
       ``(1) the SBIR and STTR programs create jobs, increase 
     capacity for technological innovation, and boost 
     international competitiveness;
       ``(2) increasing the quantity of applications from all 
     States to the SBIR and STTR programs would enhance 
     competition for such awards and the quality of the completed 
     projects; and
       ``(3) mentoring is a natural complement to the FAST program 
     of reaching out to new companies regarding the SBIR and STTR 
     programs as an effective and low-cost way to improve the 
     likelihood that such companies will succeed in such programs 
     in developing and commercializing their research.
       ``(b) Authorization for Mentoring Networks.--The recipient 
     of an award or participant in a cooperative agreement under 
     section 34 may use a reasonable amount of such assistance for 
     the establishment of a Mentoring Network under this section.
       ``(c) Criteria for Mentoring Networks.--A Mentoring Network 
     established using assistance under section 34 shall--
       ``(1) provide business advice and counseling to high 
     technology small business concerns located in the State or 
     region served by the Mentoring Network and identified under 
     section 34(c)(1)(E)(ii) as potential candidates for the SBIR 
     or STTR programs;
       ``(2) identify volunteer mentors who--
       ``(A) are persons associated with a small business concern 
     that has successfully completed one or more SBIR or STTR 
     funding agreements; and
       ``(B) have agreed to guide small business concerns through 
     all stages of the SBIR or STTR program process, including 
     providing assistance relating to--
       ``(i) proposal writing;
       ``(ii) marketing;
       ``(iii) Government accounting;
       ``(iv) Government audits;
       ``(v) project facilities and equipment;
       ``(vi) human resources;
       ``(vii) third phase partners;
       ``(viii) commercialization;
       ``(ix) venture capital networking; and
       ``(x) other matters relevant to the SBIR and STTR programs;
       ``(3) have experience working with small business concerns 
     participating in the SBIR and STTR programs;
       ``(4) contribute information to the national database 
     referred to in subsection (d); and
       ``(5) agree to reimburse volunteer mentors for out-of-
     pocket expenses related to service as a mentor under this 
     section.
       ``(d) Mentoring Database.--The Administrator shall--
       ``(1) include in the database required by section 9(k)(1), 
     in cooperation with the SBIR, STTR, and FAST programs, 
     information on Mentoring Networks and mentors participating

[[Page S9635]]

     under this section, including a description of their areas of 
     expertise;
       ``(2) work cooperatively with Mentoring Networks to 
     maintain and update the database;
       ``(3) take such action as may be necessary to aggressively 
     promote Mentoring Networks under this section; and
       ``(4) fulfill the requirements of this subsection either 
     directly or by contract.''.

     SEC. 113. SIMPLIFIED REPORTING REQUIREMENTS.

       Section 9 of the Small Business Act (15 U.S.C. 638), as 
     amended by this Act, is further amended by adding at the end 
     the following new subsection:
       ``(v) Simplified Reporting Requirements.--The Administrator 
     shall work with the Federal agencies required by this section 
     to have an SBIR program to standardize reporting requirements 
     for the collection of data from SBIR applicants and awardees, 
     including data for inclusion in the database under subsection 
     (k), taking into consideration the unique needs of each 
     agency, and to the extent possible, permitting the updating 
     of previously reported information by electronic means. Such 
     requirements shall be designed to minimize the burden on 
     small businesses.''.

     SEC. 114. RURAL OUTREACH PROGRAM EXTENSION.

       (a) Extension of Termination Date.--Section 501(b)(2) of 
     the Small Business Reauthorization Act of 1997 (15 U.S.C. 638 
     note; 111 Stat. 2622) is amended by striking ``2001'' and 
     inserting ``2005''.
       (b) Extension of Authorization of Appropriations.--Section 
     9(s)(2) of the Small Business Act (15 U.S.C. 638(s)(2)) is 
     amended by striking ``for fiscal year 1998, 1999, 2000, or 
     2001'' and inserting ``for each of the fiscal years 2000 
     through 2005,''.

                TITLE II--GENERAL BUSINESS LOAN PROGRAM

     SEC. 201. SHORT TITLE.

       This title may be cited as the ``Small Business General 
     Business Loan Improvement Act of 2000''.

     SEC. 202. LEVELS OF PARTICIPATION.

       Section 7(a)(2)(A) of the Small Business Act (15 U.S.C. 
     636(a)(2)(A)) is amended--
       (1) in paragraph (i) by striking ``$100,000'' and inserting 
     ``$150,000''; and
       (2) in paragraph (ii)--
       (A) by striking ``80 percent'' and inserting ``85 
     percent''; and
       (B) by striking ``$100,000'' and inserting ``$150,000''.

     SEC. 203. LOAN AMOUNTS.

       Section 7(a)(3)(A) of the Small Business Act (15 U.S.C. 
     636(a)(3)(A)) is amended by striking ``$750,000,'' and 
     inserting, ``$1,000,000 (or if the gross loan amount would 
     exceed $2,000,000),''.

     SEC. 204. INTEREST ON DEFAULTED LOANS.

       Subparagraph (B) of section 7(a)(4) of the Small Business 
     Act (15 U.S.C. 636(a)(4)) is amended by adding at the end the 
     following:
       ``(iii) Applicability.--Clauses (i) and (ii) shall not 
     apply to loans made on or after October 1, 2000.''.

     SEC. 205. PREPAYMENT OF LOANS.

       Section 7(a)(4) of the Small Business Act (15 U.S.C. 
     636(a)(4)) is further amended--
       (1) by striking ``(4) Interest rates and fees.--'' and 
     inserting ``(4) Interest rates and prepayment charges.--''; 
     and
       (2) by adding at the end the following:
       ``(C) Prepayment charges.--
       ``(i) In general.--A borrower who prepays any loan 
     guaranteed under this subsection shall remit to the 
     Administration a subsidy recoupment fee calculated in 
     accordance with clause (ii) if--

       ``(I) the loan is for a term of not less than 15 years;
       ``(II) the prepayment is voluntary;
       ``(III) the amount of prepayment in any calendar year is 
     more than 25 percent of the outstanding balance of the loan; 
     and
       ``(IV) the prepayment is made within the first 3 years 
     after disbursement of the loan proceeds.

       ``(ii) Subsidy recoupment fee.--The subsidy recoupment fee 
     charged under clause (i) shall be--

       ``(I) 5 percent of the amount of prepayment, if the 
     borrower prepays during the first year after disbursement;
       ``(II) 3 percent of the amount of prepayment, if the 
     borrower prepays during the second year after disbursement; 
     and
       ``(III) 1 percent of the amount of prepayment, if the 
     borrower prepays during the third year after disbursement.''.

     SEC. 206. GUARANTEE FEES.

       Section 7(a)(18)(B) of the Small Business Act (15 U.S.C. 
     636(a)(18)(B)) is amended to read as follows:
       ``(B) Exception for certain loans.--
       ``(i) In general.--Notwithstanding subparagraph (A), if the 
     total deferred participation share of a loan guaranteed under 
     this subsection is less than or equal to $150,000, the 
     guarantee fee collected under subparagraph (A) shall be in an 
     amount equal to 2 percent of the total deferred participation 
     share of the loan.
       ``(ii) Retention of fees.--Lenders participating in the 
     programs established under this subsection may retain not 
     more than 25 percent of the fee collected in accordance with 
     this subparagraph with respect to any loan not exceeding 
     $150,000 in gross loan amount.''.

     SEC. 207. LEASE TERMS.

       Section 7(a) of the Small Business Act (15 U.S.C. 636(a)) 
     is further amended by adding at the end the following:
       ``(28) Leasing.--In addition to such other lease 
     arrangements as may be authorized by the Administration, a 
     borrower may permanently lease to one or more tenants not 
     more than 20 percent of any property constructed with the 
     proceeds of a loan guaranteed under this subsection, if the 
     borrower permanently occupies and uses not less than 60 
     percent of the total business space in the property.''.

            TITLE III--CERTIFIED DEVELOPMENT COMPANY PROGRAM

     SEC. 301. SHORT TITLE.

       This title may be cited as the ``Certified Development 
     Company Program Improvements Act of 2000''.

     SEC. 302. WOMEN-OWNED BUSINESSES.

       Section 501(d)(3)(C) of the Small Business Investment Act 
     (15 U.S.C. 695(d)(3)(C)) is amended by inserting before the 
     comma ``or women-owned business development''.

     SEC. 303. MAXIMUM DEBENTURE SIZE.

       Section 502(2) of the Small Business Investment Act of 1958 
     (15 U.S.C. 696(2)) is amended to read as follows:
       ``(2) Loans made by the Administration under this section 
     shall be limited to $1,000,000 for each such identifiable 
     small business concern, except loans meeting the criteria 
     specified in section 501(d)(3), which shall be limited to 
     $1,300,000 for each such identifiable small business 
     concern.''.

     SEC. 304. FEES.

       Section 503(f) of the Small Business Investment Act of 1958 
     (15 U.S.C. 697(f)) is amended to read as follows:
       ``(f) Effective Date.--The fees authorized by subsections 
     (b) and (d) shall apply to financings approved by the 
     Administration on or after October 1, 1996, but shall not 
     apply to financings approved by the Administration on or 
     after October 1, 2003.''.

     SEC. 305. PREMIER CERTIFIED LENDERS PROGRAM.

       Section 217(b) of the Small Business Reauthorization and 
     Amendments Act of 1994 (relating to section 508 of the Small 
     Business Investment Act) is repealed.

     SEC. 306. SALE OF CERTAIN DEFAULTED LOANS.

       Section 508 of the Small Business Investment Act of 1958 
     (15 U.S.C. 697e) is amended--
       (1) in subsection (a), by striking ``On a pilot program 
     basis, the'' and inserting ``The'';
       (2) by redesignating subsections (d) though (i) as 
     subsections (e) though (j), respectively;
       (3) in subsection (f) (as redesignated by paragraph (2)), 
     by striking ``subsection (f)'' and inserting ``subsection 
     (g)'';
       (4) in subsection (h) (as redesignated by paragraph (2)), 
     by striking ``subsection (f)'' and inserting ``subsection 
     (g)''; and
       (5) by inserting after subsection (c) the following:
       ``(d) Sale of Certain Defaulted Loans.--
       ``(1) Notice.--If, upon default in repayment, the 
     Administration acquires a loan guaranteed under this section 
     and identifies such loan for inclusion in a bulk asset sale 
     of defaulted or repurchased loans or other financings, it 
     shall give prior notice thereof to any certified development 
     company which has a contingent liability under this section. 
     The notice shall be given to the company as soon as possible 
     after the financing is identified, but not less than 90 days 
     before the date the Administration first makes any records on 
     such financing available for examination by prospective 
     purchasers prior to its offering in a package of loans for 
     bulk sale.
       ``(2) Limitations.--The Administration shall not offer any 
     loan described in paragraph (1) as part of a bulk sale unless 
     it--
       ``(A) provides prospective purchasers with the opportunity 
     to examine the Administration's records with respect to such 
     loan; and
       ``(B) provides the notice required by paragraph (1).''.

     SEC. 307. LOAN LIQUIDATION.

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

     ``SEC. 510. FORECLOSURE AND LIQUIDATION OF LOANS.

       ``(a) Delegation of Authority.--In accordance with this 
     section, the Administration shall delegate to any qualified 
     State or local development company (as defined in section 
     503(e)) that meets the eligibility requirements of subsection 
     (b)(1) the authority to foreclose and liquidate, or to 
     otherwise treat in accordance with this section, defaulted 
     loans in its portfolio that are funded with the proceeds of 
     debentures guaranteed by the Administration under section 
     503.
       ``(b) Eligibility for Delegation.--
       ``(1) Requirements.--A qualified State or local development 
     company shall be eligible for a delegation of authority under 
     subsection (a) if--
       ``(A) the company--
       ``(i) has participated in the loan liquidation pilot 
     program established by the Small Business Programs 
     Improvement Act of 1996 (15 U.S.C. 695 note), as in effect on 
     the day before promulgation of final regulations by the 
     Administration implementing this section;
       ``(ii) is participating in the Premier Certified Lenders 
     Program under section 508; or
       ``(iii) during the 3 fiscal years immediately prior to 
     seeking such a delegation, has made an average of not less 
     than 10 loans per year that are funded with the proceeds of 
     debentures guaranteed under section 503; and
       ``(B) the company--
       ``(i) has one or more employees--

       ``(I) with not less than 2 years of substantive, decision-
     making experience in administering the liquidation and 
     workout of problem loans secured in a manner substantially 
     similar to loans funded with the proceeds of debentures 
     guaranteed under section 503; and
       ``(II) who have completed a training program on loan 
     liquidation developed by the Administration in conjunction 
     with qualified State and local development companies that 
     meet the requirements of this paragraph; or

       ``(ii) submits to the Administration documentation 
     demonstrating that the company has contracted with a 
     qualified third-party to perform any liquidation activities 
     and secures the

[[Page S9636]]

     approval of the contract by the Administration with respect 
     to the qualifications of the contractor and the terms and 
     conditions of liquidation activities.
       ``(2) Confirmation.--On request the Administration shall 
     examine the qualifications of any company described in 
     subsection (a) to determine if such company is eligible for 
     the delegation of authority under this section. If the 
     Administration determines that a company is not eligible, the 
     Administration shall provide the company with the reasons for 
     such ineligibility.
       ``(c) Scope of Delegated Authority.--
       ``(1) In general.--Each qualified State or local 
     development company to which the Administration delegates 
     authority under section (a) may with respect to any loan 
     described in subsection (a)--
       ``(A) perform all liquidation and foreclosure functions, 
     including the purchase in accordance with this subsection of 
     any other indebtedness secured by the property securing the 
     loan, in a reasonable and sound manner according to 
     commercially accepted practices, pursuant to a liquidation 
     plan approved in advance by the Administration under 
     paragraph (2)(A);
       ``(B) litigate any matter relating to the performance of 
     the functions described in subparagraph (A), except that the 
     Administration may--
       ``(i) defend or bring any claim if--

       ``(I) the outcome of the litigation may adversely affect 
     the Administration's management of the loan program 
     established under section 502; or
       ``(II) the Administration is entitled to legal remedies not 
     available to a qualified State or local development company 
     and such remedies will benefit either the Administration or 
     the qualified State or local development company; or

       ``(ii) oversee the conduct of any such litigation; and
       ``(C) take other appropriate actions to mitigate loan 
     losses in lieu of total liquidation or foreclosures, 
     including the restructuring of a loan in accordance with 
     prudent loan servicing practices and pursuant to a workout 
     plan approved in advance by the Administration under 
     paragraph (2)(C).
       ``(2) Administration approval.--
       ``(A) Liquidation plan.--
       ``(i) In general.--Before carrying out functions described 
     in paragraph (1)(A), a qualified State or local development 
     company shall submit to the Administration a proposed 
     liquidation plan.
       ``(ii) Administration action on plan.--

       ``(I) Timing.--Not later than 15 business days after a 
     liquidation plan is received by the Administration under 
     clause (i), the Administration shall approve or reject the 
     plan.
       ``(II) Notice of no decision.--With respect to any plan 
     that cannot be approved or denied within the 15-day period 
     required by subclause (I), the Administration shall within 
     such period provide in accordance with subparagraph (E) 
     notice to the company that submitted the plan.

       ``(iii) Routine actions.--In carrying out functions 
     described in paragraph (1)(A), a qualified State or local 
     development company may undertake routine actions not 
     addressed in a liquidation plan without obtaining additional 
     approval from the Administration.
       ``(B) Purchase of indebtedness.--
       ``(i) In general.--In carrying out functions described in 
     paragraph (1)(A), a qualified State or local development 
     company shall submit to the Administration a request for 
     written approval before committing the Administration to the 
     purchase of any other indebtedness secured by the property 
     securing a defaulted loan.
       ``(ii) Administration action on request.--

       ``(I) Timing.--Not later than 15 business days after 
     receiving a request under clause (i), the Administration 
     shall approve or deny the request.
       ``(II) Notice of no decision.--With respect to any request 
     that cannot be approved or denied within the 15-day period 
     required by subclause (I), the Administration shall within 
     such period provide in accordance with subparagraph (E) 
     notice to the company that submitted the request.

       ``(C) Workout plan.--
       ``(i) In general.--In carrying out functions described in 
     paragraph (1)(C), a qualified State or local development 
     company shall submit to the Administration a proposed workout 
     plan.
       ``(ii) Administration action on plan.--

       ``(I) Timing.--Not later than 15 business days after a 
     workout plan is received by the Administration under clause 
     (i), the Administration shall approve or reject the plan.
       ``(II) Notice of no decision.--With respect to any workout 
     plan that cannot be approved or denied within the 15-day 
     period required by subclause (I), the Administration shall 
     within such period provide in accordance with subparagraph 
     (E) notice to the company that submitted the plan.

       ``(D) Compromise of indebtedness.--In carrying out 
     functions described in paragraph (1)(A), a qualified State or 
     local development company may--
       ``(i) consider an offer made by an obligor to compromise 
     the debt for less than the full amount owing; and
       ``(ii) pursuant to such an offer, release any obligor or 
     other party contingently liable, if the company secures the 
     written approval of the Administration.
       ``(E) Contents of notice of no decision.--Any notice 
     provided by the Administration under subparagraphs 
     (A)(ii)(II), (B)(ii)(II), or (C)(ii)(II)--
       ``(i) shall be in writing;
       ``(ii) shall state the specific reason for the 
     Administration's inability to act on a plan or request;
       ``(iii) shall include an estimate of the additional time 
     required by the Administration to act on the plan or request; 
     and
       ``(iv) if the Administration cannot act because 
     insufficient information or documentation was provided by the 
     company submitting the plan or request, shall specify the 
     nature of such additional information or documentation.
       ``(3) Conflict of interest.--In carrying out functions 
     described in paragraph (1), a qualified State or local 
     development company shall take no action that would result in 
     an actual or apparent conflict of interest between the 
     company (or any employee of the company) and any third party 
     lender, associate of a third party lender, or any other 
     person participating in a liquidation, foreclosure, or loss 
     mitigation action.
       ``(d) Suspension or Revocation of Authority.--The 
     Administration may revoke or suspend a delegation of 
     authority under this section to any qualified State or local 
     development company, if the Administration determines that 
     the company--
       ``(1) does not meet the requirements of subsection (b)(1);
       ``(2) has violated any applicable rule or regulation of the 
     Administration or any other applicable law; or
       ``(3) fails to comply with any reporting requirement that 
     may be established by the Administration relating to carrying 
     out of functions described in paragraph (1).
       ``(e) Report.--
       ``(1) In general.--Based on information provided by 
     qualified State and local development companies and the 
     Administration, the Administration shall annually submit to 
     the Committees on Small Business of the House of 
     Representatives and of the Senate a report on the results of 
     delegation of authority under this section.
       ``(2) Contents.--Each report submitted under paragraph (1) 
     shall include the following information:
       ``(A) With respect to each loan foreclosed or liquidated by 
     a qualified State or local development company under this 
     section, or for which losses were otherwise mitigated by the 
     company pursuant to a workout plan under this section--
       ``(i) the total cost of the project financed with the loan;
       ``(ii) the total original dollar amount guaranteed by the 
     Administration;
       ``(iii) the total dollar amount of the loan at the time of 
     liquidation, foreclosure, or mitigation of loss;
       ``(iv) the total dollar losses resulting from the 
     liquidation, foreclosure, or mitigation of loss; and
       ``(v) the total recoveries resulting from the liquidation, 
     foreclosure, or mitigation of loss, both as a percentage of 
     the amount guaranteed and the total cost of the project 
     financed.
       ``(B) With respect to each qualified State or local 
     development company to which authority is delegated under 
     this section, the totals of each of the amounts described in 
     clauses (i) through (v) of subparagraph (A).
       ``(C) With respect to all loans subject to foreclosure, 
     liquidation, or mitigation under this section, the totals of 
     each of the amounts described in clauses (i) through (v) of 
     subparagraph (A).
       ``(D) A comparison between--
       ``(i) the information provided under subparagraph (C) with 
     respect to the 12-month period preceding the date on which 
     the report is submitted; and
       ``(ii) the same information with respect to loans 
     foreclosed and liquidated, or otherwise treated, by the 
     Administration during the same period.
       ``(E) The number of times that the Administration has 
     failed to approve or reject a liquidation plan in accordance 
     with subparagraph (A)(i), a workout plan in accordance with 
     subparagraph (C)(i), or to approve or deny a request for 
     purchase of indebtedness under subparagraph (B)(i), including 
     specific information regarding the reasons for the 
     Administration's failure and any delays that resulted.''.
       (b) Regulations.--
       (1) In general.--Not later than 150 days after the date of 
     the enactment of this Act, the Administrator shall issue such 
     regulations as may be necessary to carry out section 510 of 
     the Small Business Investment Act of 1958, as added by 
     subsection (a) of this section.
       (2) Termination of pilot program.--Beginning on the date 
     which the final regulations are issued under paragraph (1), 
     section 204 of the Small Business Programs Improvement Act of 
     1996 (15 U.S.C. 695 note) shall cease to have effect.

   TITLE IV--CORRECTIONS TO THE SMALL BUSINESS INVESTMENT ACT OF 1958

     SEC. 401. SHORT TITLE.

       This title may be cited as the ``Small Business Investment 
     Corrections Act of 2000''.

     SEC. 402. DEFINITIONS.

       (a) Small Business Concern.--Section 103(5)(A)(i) of the 
     Small Business Investment Act of 1958 (15 U.S.C. 
     662(5)(A)(i)) is amended by inserting ``regardless of the 
     allocation of control during the investment period under any 
     investment agreement between the business concern and the 
     entity making the investment'' before the semicolon at the 
     end.
       (b) Long Term.--Section 103 of the Small Business 
     Investment Act of 1958 (15 U.S.C. 662) is amended--
       (1) in paragraph (15), by striking ``and'' at the end;
       (2) in paragraph (16), by striking the period at the end 
     and inserting ``; and''; and
       (3) by adding at the end the following new paragraph:
       ``(17) the term `long term', when used in connection with 
     equity capital or loan funds invested in any small business 
     concern or smaller enterprise, means any period of time not 
     less than 1 year.''.

     SEC. 403. INVESTMENT IN SMALL BUSINESS INVESTMENT COMPANIES.

       Section 302(b) of the Small Business Investment Act of 1958 
     (15 U.S.C. 682(b)) is amended--

[[Page S9637]]

       (1) by striking ``(b) Notwithstanding'' and inserting the 
     following:
       ``(b) Financial Institution Investments.--
       ``(1) Certain banks.--Notwithstanding''; and
       (2) by adding at the end the following:
       ``(2) Certain savings associations.--Notwithstanding any 
     other provision of law, any Federal savings association may 
     invest in any one or more small business investment 
     companies, or in any entity established to invest solely in 
     small business investment companies, except that in no event 
     may the total amount of such investments by any such Federal 
     savings association exceed 5 percent of the capital and 
     surplus of the Federal savings association.''.

     SEC. 404. SUBSIDY FEES.

       (a) Debentures.--Section 303(b) of the Small Business 
     Investment Act of 1958 (15 U.S.C. 683(b)) is amended by 
     striking ``plus an additional charge of 1 percent per annum 
     which shall be paid to and retained by the Administration'' 
     and inserting ``plus, for debentures issued after September 
     30, 2000, an additional charge, in an amount established 
     annually by the Administration, of not more than 1 percent 
     per year as necessary to reduce to zero the cost (as defined 
     in section 502 of the Federal Credit Reform Act of 1990 (2 
     U.S.C. 661a)) to the Administration of purchasing and 
     guaranteeing debentures under this Act, which shall be paid 
     to and retained by the Administration''.
       (b) Participating Securities.--Section 303(g)(2) of the 
     Small Business Investment Act of 1958 (15 U.S.C. 683(g)(2)) 
     is amended by striking ``plus an additional charge of 1 
     percent per annum which shall be paid to and retained by the 
     Administration'' and inserting ``plus, for participating 
     securities issued after September 30, 2000, an additional 
     charge, in an amount established annually by the 
     Administration, of not more than 1 percent per year as 
     necessary to reduce to zero the cost (as defined in section 
     502 of the Federal Credit Reform Act of 1990 (2 U.S.C. 661a)) 
     to the Administration of purchasing and guaranteeing 
     participating securities under this Act, which shall be paid 
     to and retained by the Administration''.

     SEC. 405. DISTRIBUTIONS.

       Section 303(g)(8) of the Small Business Investment Act of 
     1958 (15 U.S.C. 683(g)(8)) is amended--
       (1) by striking ``subchapter s corporation'' and inserting 
     ``subchapter S corporation'';
       (2) by striking ``the end of any calendar quarter based on 
     a quarterly'' and inserting ``any time during any calendar 
     quarter based on an''; and
       (3) by striking ``quarterly distributions for a calendar 
     year,'' and inserting ``interim distributions for a calendar 
     year,''.

     SEC. 406. CONFORMING AMENDMENT.

       Section 310(c)(4) of the Small Business Investment Act of 
     1958 (15 U.S.C. 687b(c)(4)) is amended by striking ``five 
     years'' and inserting ``1 year''.

          TITLE V--REAUTHORIZATION OF SMALL BUSINESS PROGRAMS

     SEC. 501. SHORT TITLE.

       This title may be cited as the ``Small Business 
     Reauthorization Act of 2000''.

     SEC. 502. REAUTHORIZATION OF SMALL BUSINESS PROGRAMS.

       Section 20 of the Small Business Act (15 U.S.C. 631 note) 
     is amended by adding at the end the following:
       ``(g) Fiscal Year 2001.--
       ``(1) Program levels.--The following program levels are 
     authorized for fiscal year 2001:
       ``(A) For the programs authorized by this Act, the 
     Administration is authorized to make--
       ``(i) $45,000,000 in technical assistance grants as 
     provided in section 7(m); and
       ``(ii) $60,000,000 in direct loans, as provided in 7(m).
       ``(B) For the programs authorized by this Act, the 
     Administration is authorized to make $19,050,000,000 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) $4,000,000,000 in financings as provided in section 
     7(a)(13) of this Act and section 504 of the Small Business 
     Investment Act of 1958;
       ``(iii) $500,000,000 in loans as provided in section 
     7(a)(21); and
       ``(iv) $50,000,000 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) $2,500,000,000 in purchases of participating 
     securities; and
       ``(ii) $1,500,000,000 in guarantees of debentures.
       ``(D) For the programs authorized by part B of title IV of 
     the Small Business Investment Act of 1958, the Administration 
     is authorized to enter into guarantees not to exceed 
     $4,000,000,000 of which not more than 50 percent 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 for a total amount of $5,000,000 
     for the Service Corps of Retired Executives program 
     authorized by section 8(b)(1).
       ``(2) Additional authorizations.--
       ``(A) There are authorized to be appropriated to the 
     Administration for fiscal year 2001 such sums as may be 
     necessary to carry out the provisions of this Act not 
     elsewhere provided for, including administrative expenses and 
     necessary loan capital for disaster loans pursuant to section 
     7(b), and to carry out title IV of the Small Business 
     Investment Act of 1958, including salaries and expenses of 
     the Administration.
       ``(B) Notwithstanding any other provision of this 
     paragraph, for fiscal year 2001--
       ``(i) no funds are authorized to be used as loan capital 
     for 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 its own 
     behalf or on behalf of any other Federal 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.
       ``(h) Fiscal Year 2002.--
       ``(1) Program levels.--The following program levels are 
     authorized for fiscal year 2002:
       ``(A) For the programs authorized by this Act, the 
     Administration is authorized to make--
       ``(i) $60,000,000 in technical assistance grants as 
     provided in section 7(m); and
       ``(ii) $80,000,000 in direct loans, as provided in 7(m).
       ``(B) For the programs authorized by this Act, the 
     Administration is authorized to make $20,050,000,000 in 
     deferred participation loans and other financings. Of such 
     sum, the Administration is authorized to make--
       ``(i) $15,000,000,000 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) $500,000,000 in loans as provided in section 
     7(a)(21); and
       ``(iv) $50,000,000 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) $3,500,000,000 in purchases of participating 
     securities; and
       ``(ii) $2,500,000,000 in guarantees of debentures.
       ``(D) For the programs authorized by part B of title IV of 
     the Small Business Investment Act of 1958, the Administration 
     is authorized to enter into guarantees not to exceed 
     $5,000,000,000 of which not more than 50 percent 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 for a total amount of $6,000,000 
     for the Service Corps of Retired Executives program 
     authorized by section 8(b)(1).
       ``(2) Additional authorizations.--
       ``(A) There are authorized to be appropriated to the 
     Administration for fiscal year 2002 such sums as may be 
     necessary to carry out the provisions of this Act not 
     elsewhere provided for, including administrative expenses and 
     necessary loan capital for disaster loans pursuant to section 
     7(b), and to carry out title IV of the Small Business 
     Investment Act of 1958, including salaries and expenses of 
     the Administration.
       ``(B) Notwithstanding any other provision of this 
     paragraph, for fiscal year 2002--
       ``(i) no funds are authorized to be used as loan capital 
     for 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 its own 
     behalf or on behalf of any other Federal 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.
       ``(i) Fiscal Year 2003.--
       ``(1) Program levels.--The following program levels are 
     authorized for fiscal year 2003:
       ``(A) For the programs authorized by this Act, the 
     Administration is authorized to make--
       ``(i) $70,000,000 in technical assistance grants as 
     provided in section 7(m); and
       ``(ii) $100,000,000 in direct loans, as provided in 7(m).
       ``(B) For the programs authorized by this Act, the 
     Administration is authorized to make $21,550,000,000 in 
     deferred participation loans and other financings. Of such 
     sum, the Administration is authorized to make--
       ``(i) $16,000,000,000 in general business loans as provided 
     in section 7(a);
       ``(ii) $5,000,000,000 in financings as provided in section 
     7(a)(13) of this Act and section 504 of the Small Business 
     Investment Act of 1958;
       ``(iii) $500,000,000 in loans as provided in section 
     7(a)(21); and
       ``(iv) $50,000,000 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) $4,000,000,000 in purchases of participating 
     securities; and
       ``(ii) $3,000,000,000 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 
     $6,000,000,000 of which not more than 50 percent 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 for a total amount of 
     $7,000,000 for the Service Corps of Retired Executives 
     program authorized by section 8(b)(1).
       ``(2) Additional authorizations.--
       ``(A) There are authorized to be appropriated to the 
     Administration for fiscal year 2003 such sums as may be 
     necessary to carry out the provisions of this Act not 
     elsewhere provided for, including administrative expenses and 
     necessary

[[Page S9638]]

     loan capital for disaster loans pursuant to section 7(b), and 
     to carry out title IV of the Small Business Investment Act of 
     1958, including salaries and expenses of the Administration.
       ``(B) Notwithstanding any other provision of this 
     paragraph, for fiscal year 2003--
       ``(i) no funds are authorized to be used as loan capital 
     for 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 its own 
     behalf or on behalf of any other Federal 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.''.

     SEC. 503. ADDITIONAL REAUTHORIZATIONS.

       (a) Small Business Development Centers Program.--Section 
     21(a)(4)(C)(iii)(III) of the Small Business Act (15 U.S.C. 
     648(a)(4)(C)(iii)(III)) is amended by striking 
     ``$95,000,000'' and inserting ``$125,000,000''.
       (b) Drug-Free Workplace Program.--Section 27 of the Small 
     Business Act (15 U.S.C. 654) is amended--
       (1) in the section heading, by striking ``DRUG-FREE 
     WORKPLACE DEMONSTRATION PROGRAM'' and inserting ``PAUL D. 
     COVERDELL DRUG-FREE WORKPLACE PROGRAM''; and
       (2) in subsection (g)(1), by striking ``$10,000,000 for 
     fiscal years 1999 and 2000'' and inserting ``$5,000,000 for 
     each of fiscal years 2001 through 2003''.
       (c) HUBZone Program.--Section 31 of the Small Business Act 
     (15 U.S.C. 657a) is amended by adding at the end the 
     following new subsection:
       ``(d) Authorization of Appropriations.--There is authorized 
     to be appropriated to carry out the program established by 
     this section $10,000,000 for each of fiscal years 2001 
     through 2003.''.
       (d) Women's Business Enterprise Development Programs.--
     Section 411 of the Women's Business Ownership Act (Public Law 
     105-135; 15 U.S.C. 631 note) is amended by striking 
     ``$600,000, for each of fiscal years 1998 through 2000,'' and 
     inserting ``$1,000,000 for each of fiscal years 2001 through 
     2003,''.
       (e) Very Small Business Concerns Program.--Section 304(i) 
     of the Small Business Administration Reauthorization and 
     Amendments Act of 1994 (Public Law 103-403; 15 U.S.C. 644 
     note) is amended by striking ``September 30, 2000'' and 
     inserting ``September 30, 2003''.
       (f) Socially and Economically Disadvantaged Businesses 
     Program.--Section 7102(c) of the Federal Acquisition 
     Streamlining Act of 1994 (Public Law 103-355; 15 U.S.C. 644 
     note) is amended by striking ``September 30, 2000'' and 
     inserting ``September 30, 2003''.

                   TITLE VI--MISCELLANEOUS PROVISIONS

     SEC. 601. LOAN APPLICATION PROCESSING.

       (a) Study.--The Administrator of the Small Business 
     Administration shall conduct a study to determine the average 
     time that the Administration requires to process an 
     application for each type of loan or loan guarantee made 
     under the Small Business Act (15 U.S.C. 631 et seq.).
       (b) Transmittal.--Not later than 1 year after the date of 
     the enactment of this title, the Administrator shall transmit 
     to Congress the results of the study conducted under 
     subsection (a).

     SEC. 602. APPLICATION OF OWNERSHIP REQUIREMENTS.

       Section 2 of the Small Business Act (15 U.S.C. 631) is 
     amended by adding at the end the following new subsection:
       ``(k) Application of Ownership Requirements.--Each 
     ownership requirement established under this Act or the Small 
     Business Investment Act of 1958 (15 U.S.C. 661 et seq.) shall 
     be applied without regard to any possible future ownership 
     interest of a spouse arising from the application of any 
     State community property law established for the purpose of 
     determining marital interest.''.

     SEC. 603. ELIGIBILITY FOR HUBZONE PROGRAM.

       Section 3(p)(5) of the Small Business Act (15 U.S.C. 
     632(p)(5)) is amended by adding at the end the following new 
     subparagraph:
       ``(E) Extension of eligibility.--If a geographic area that 
     qualified as a HUBZone under this subsection ceases to 
     qualify as a result of a change in official government data 
     or boundary designations, each small business concern 
     certified as HUBZone small business concern in connection 
     with such geographic area shall remain certified as such for 
     a period of 1 year after the effective date of the change in 
     HUBZone status, if the small business concern continues to 
     meet each of the other qualifications applicable to a HUBZone 
     small business concern.''.

     SEC. 604. SUBCONTRACTING PREFERENCE FOR VETERANS.

       Section 8(d) of the Small Business Act (15 U.S.C. 637(d)) 
     is amended--
       (1) in paragraph (1), by inserting ``small business 
     concerns owned and controlled by veterans,'' after ``small 
     business concerns,'' the first place that term appears in 
     each of the first and second sentences;
       (2) in paragraph (3)--
       (A) in subparagraph (A), by inserting ``small business 
     concerns owned and controlled by service-disabled veterans,'' 
     after ``small business concerns owned and controlled by 
     veterans,'' in each of the first and second sentences; and
       (B) in subparagraph (F), by inserting ``small business 
     concern owned and controlled by service-disabled veterans,'' 
     after ``small business concern owned and controlled by 
     veterans,''; and
       (3) in each of paragraphs (4)(D), (4)(E), (6)(A), (6)(C), 
     (6)(F), and (10)(B), by inserting ``small business concern 
     owned and controlled by service-disabled veterans,'' after 
     ``small business concerns owned and controlled by 
     veterans,''.

     SEC. 605. SMALL BUSINESS DEVELOPMENT CENTER PROGRAM FUNDING.

       (a) Authorization.--
       (1) In general.--Section 20(a)(1) of the Small Business Act 
     (15 U.S.C. 631 note) is amended by striking ``For fiscal year 
     1985'' and all that follows through ``expended.'' and 
     inserting the following: ``For fiscal year 2000 and each 
     fiscal year thereafter, there are authorized to be 
     appropriated such sums as may be necessary and appropriate, 
     to remain available until expended, and to be available 
     solely--
       ``(A) to carry out the Small Business Development Center 
     Program under section 21, but not to exceed the annual 
     funding level, as specified in section 21(a);
       ``(B) to pay the expenses of the National Small Business 
     Development Center Advisory Board, as provided in section 
     21(i);
       ``(C) to pay the expenses of the information sharing 
     system, as provided in section 21(c)(8);
       ``(D) to pay the expenses of the association referred to in 
     section 21(a)(3)(A) for conducting the certification program, 
     as provided in section 21(k)(2); and
       ``(E) to pay the expenses of the Administration, including 
     salaries of examiners, for conducting examinations as part of 
     the certification program conducted by the association 
     referred to in section 21(a)(3)(A).''.
       (2) Technical amendment.--Section 20(a) of the Small 
     Business Act (15 U.S.C. 631 note) is further amended by 
     moving paragraphs (3) and (4), including subparagraphs (A) 
     and (B) of paragraph (4), 2 ems to the left.
       (b) Funding Formula.--Section 21(a)(4)(C) of the Small 
     Business Act (15 U.S.C. 648(a)(4)(C)) is amended to read as 
     follows:
       ``(C) Funding formula.--
       ``(i) In general.--Subject to clause (iii), the amount of a 
     formula grant received by a State under this subparagraph 
     shall be equal to an amount determined in accordance with the 
     following formula:
       ``(I) The annual amount made available under section 20(a) 
     for the Small Business Development Center Program, less any 
     reductions made for expenses authorized by clause (v) of this 
     subparagraph, shall be divided on a pro rata basis, based on 
     the percentage of the population of each State, as compared 
     to the population of the United States.
       ``(II) If the pro rata amount calculated under subclause 
     (I) for any State is less than the minimum funding level 
     under clause (iii), the Administration shall determine the 
     aggregate amount necessary to achieve that minimum funding 
     level for each such State.
       ``(III) The aggregate amount calculated under subclause 
     (II) shall be deducted from the amount calculated under 
     subclause (I) for States eligible to receive more than the 
     minimum funding level. The deductions shall be made on a pro 
     rata basis, based on the population of each such State, as 
     compared to the total population of all such States.
       ``(IV) The aggregate amount deducted under subclause (III) 
     shall be added to the grants of those States that are not 
     eligible to receive more than the minimum funding level in 
     order to achieve the minimum funding level for each such 
     State, except that the eligible amount of a grant to any 
     State shall not be reduced to an amount below the minimum 
     funding level.
       ``(ii) Grant determination.--The amount of a grant that a 
     State is eligible to apply for under this subparagraph shall 
     be the amount determined under clause (i), subject to any 
     modifications required under clause (iii), and shall be based 
     on the amount available for the fiscal year in which 
     performance of the grant commences, but not including amounts 
     distributed in accordance with clause (iv). The amount of a 
     grant received by a State under any provision of this 
     subparagraph shall not exceed the amount of matching funds 
     from sources other than the Federal Government, as required 
     under subparagraph (A).
       ``(iii) Minimum funding level.--The amount of the minimum 
     funding level for each State shall be determined for each 
     fiscal year based on the amount made available for that 
     fiscal year to carry out this section, as follows:
       ``(I) If the amount made available is not less than 
     $81,500,000 and not more than $90,000,000, the minimum 
     funding level shall be $500,000.
       ``(II) If the amount made available is less than 
     $81,500,000, the minimum funding level shall be the remainder 
     of $500,000 minus a percentage of $500,000 equal to the 
     percentage amount by which the amount made available is less 
     than $81,500,000.
       ``(III) If the amount made available is more than 
     $90,000,000, the minimum funding level shall be the sum of 
     $500,000 plus a percentage of $500,000 equal to the 
     percentage amount by which the amount made available exceeds 
     $90,000,000.
       ``(iv) Distributions.--Subject to clause (iii), if any 
     State does not apply for, or use, its full funding 
     eligibility for a fiscal year, the Administration shall 
     distribute the remaining funds as follows:
       ``(I) If the grant to any State is less than the amount 
     received by that State in fiscal year 2000, the 
     Administration shall distribute such remaining funds, on a 
     pro rata basis, based on the percentage of shortage of each 
     such State, as compared to the total amount of such remaining 
     funds available, to the extent necessary in order to increase 
     the amount of the grant to the amount received by that State 
     in 2000, or until such funds are exhausted, whichever first 
     occurs.
       ``(II) If any funds remain after the application of 
     subclause (I), the remaining amount may

[[Page S9639]]

     be distributed as supplemental grants to any State, as the 
     Administration determines, in its discretion, to be 
     appropriate, after consultation with the association referred 
     to in subsection (a)(3)(A).
       ``(v) Use of amounts.--
       ``(I) In general.--Of the amounts made available in any 
     fiscal year to carry out this section--

       ``(aa) not more than $500,000 may be used by the 
     Administration to pay expenses enumerated in subparagraphs 
     (B) through (D) of section 20(a)(1); and
       ``(bb) not more than $500,000 may be used by the 
     Administration to pay the examination expenses enumerated in 
     section 20(a)(1)(E).

       ``(II) Limitation.--No funds described in subclause (I) may 
     be used for examination expenses under section 20(a)(1)(E) if 
     the usage would reduce the amount of grants made available 
     under clause (i)(I) to less than $85,000,000 (after excluding 
     any amounts provided in appropriations Acts for specific 
     institutions or for purposes other than the general small 
     business development center program) or would further reduce 
     the amount of such grants below such amount.
       ``(vi) Exclusions.--Grants provided to a State by the 
     Administration or another Federal agency to carry out 
     subsection (c)(3)(G) or (a)(6) or supplemental grants set 
     forth in clause (iv)(II) of this subparagraph, shall not be 
     included in the calculation of maximum funding for a State 
     under clause (ii) of this subparagraph.
       ``(vii) Authorization of appropriations.--There is 
     authorized to be appropriated to carry out this subparagraph 
     $125,000,000 for each of fiscal years 2001, 2002, and 2003.
       ``(viii) State defined.--In this subparagraph, the term 
     `State' means each of the several States, the District of 
     Columbia, the Commonwealth of Puerto Rico, the Virgin 
     Islands, Guam, American Samoa, the Commonwealth of the 
     Northern Mariana Islands, and any other commonwealth, 
     territory, or possession of the United States.''.

     SEC. 606. SURETY BONDS.

       (a) Contract Amounts.--Section 411 of the Small Business 
     Investment Act of 1958 (15 U.S.C. 694b) is amended--
       (1) in subsection (a)(1), by striking ``$1,250,000'' and 
     inserting ``$2,000,000''; and
       (2) in subsection (e)(2), by striking ``$1,250,000'' and 
     inserting ``$2,000,000''.
       (b) Extension of Certain Authority.--Section 207 of the 
     Small Business Administration Reauthorization and Amendment 
     Act of 1988 (15 U.S.C. 694b note) is amended by striking 
     ``2000'' and inserting ``2003''.


                           Amendment No. 4286

            (Purpose: To provide for a complete substitute)

  Mr. KYL. I ask unanimous consent that the Senate concur in the 
amendment of the House, with a further amendment which is at the desk.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  The amendment (No. 4286) was agreed to.
  (The text of the amendment is printed in today's Record under 
``Amendments Submitted.'')
  Mr. BOND. Mr. President, I rise today in support of important 
legislation to re-authorize the Small Business Innovation and Research 
(SBIR) program and other essential programs at the Small Business 
Administration (SBA). On Monday, September 25, 2000, the House of 
Representatives amended the Senate-passed version of H.R. 2392, the 
Small Business Innovation Research Program Reauthorization Act of 2000, 
by adding the following bills to this legislation: H.R. 2614 (The 
Certified Development Company Program Improvement Act of 2000), H.R. 
2615, (to make improvements to the 7(a) guaranteed business loan 
program), H.R. 3843, (the Small Business Reauthorization Act of 2000), 
and H.R. 3845, (the Small Business Investment Corrections Act of 2000).
  While the House-passed bill includes many important programs to help 
small businesses, there are some serious omissions. Although I strongly 
support H.R. 2392 as amended by the House, Senator John Kerry and I are 
offering an amendment in the nature of a substitute to restore some of 
the most serious omissions to H.R. 2392. Our amendment adds to, but 
does not remove, any provisions from the House-passed bill.
  The House-passed version of H.R. 2392 failed to include some very key 
provisions that are critical to the mission of SBA in Fiscal Year 2001. 
The House bill did include the Senate-passed bill to improve and extend 
the SBIR program for eight years, and it did adopt authorization levels 
for SBA programs included in the Senate version of the Small Business 
Reauthorization Act of 2000. However, the House bill failed to include 
many key provisions that were approved by the Senate Committee on Small 
Business earlier this year. Our Substitute Amendment will restore some 
of the most important omitted provisions.
  The following is a list of the program amendments that were excluded 
from the House bill that we have included in the Bond-Kerry substitute 
amendment: Senator Kerry's Microloan program amendments that make 
extensive improvements in this key small business credit program; re-
authorization of the National Women's Business Council, an amendment 
sponsored by Senator Landrieu during the committee markup; a change in 
the small business size standard system proposed by Senator Feinstein 
that will help small fresh fruit and vegetable packing houses to 
qualify for Federal disaster relief; comprehensive amendments that I 
sponsored to improve the HUBZone program, which is designed to create 
jobs and investments in economically distressed inner cities and rural 
counties; the Native American Small Business Development Center 
Network; and 7(a) guarantee business loan guarantee fee simplification 
plan.
  The Senate Committee on Small Business has approved the provisions 
being added to this legislation. In the case of the SBIR 
Reauthorization Act, the full Senate has also passed separate 
legislation. Most of the provisions included in the Bond-Kerry 
substitute amendment to H.R. 2392 are discussed at length in the 
following committee reports that have been filed in the Senate: Senate 
Report 106-289, Small Business Innovation Research Program 
Reauthorization Act of 2000; and Senate Report 106-422, Small Business 
Reauthorization Act of 2000.
  There are two major provisions that were included in S. 3121, the 
Small Business Reauthorization Act of 2000, which was reported 
favorably from the Senate Committee on Small Business, but which have 
not been included in the Bond-Kerry substitute amendment. I have 
withdrawn the two provisions in order to expedite congressional passage 
and the enactment of this important SBA and SBIR re-authorization 
legislation. It is my intention to make passage of these provisions a 
high priority in the next Congress.
  Earlier this year, the Committee on Small Business approved an 
important provision that would reverse a serious problem caused by the 
SBA in its implementation of the HUBZone Program, which the Congress 
enacted in 1997 as part of the Small Business Reauthorization Act. As 
many of my colleagues in the Senate know, the HUBZone Program directs a 
portion of the Federal contracting dollars into economically distressed 
areas of the country that have been out of the economic mainstream for 
far too long.
  HUBZone areas, which include qualified census tracts, rural counties, 
and Indian reservations, often are relatively out-of-the-way places 
that the stream of commerce often by-passe. They tend to be low-traffic 
areas that do not have a reliable customer base to support business 
development. As a result, business has been reluctant to move into 
these areas. It simply has not been profitable absent a customer base 
to keep them operating.
  The HUBZone Act seeks to overcome this problem by making it possible 
for the Federal government to become a customer for small businesses 
that locate in HUBZones. While a small business works to establish its 
regular customer base, a Federal contract can help it stabilize its 
revenues and its profitability. This program provides small business a 
chance to gain an economic foothold and to provide jobs to these areas. 
New businesses, more investments and new job opportunities mean new 
life and new hope for these communities.

  When Congress enacted the HUBZone program in 1997, a lot of people 
were concerned about how the HUBZone program would interact with the 
8(a) minority enterprise program. We in Congress agreed at that time to 
protect the 8(a) program by saying the two programs would have parity--
neither one would have an automatic preference over the other in 
getting Federal government contracts.
  Notwithstanding the 1997 Act, SBA has decided to disregard the 
instructions of the Congress and put 8(a) ahead of HUBZones in every 
case. Even if the Government is failing to reach its HUBZone goal and 
is meeting its Small Disadvantaged Business goal (of which 8(a) is a 
part), SBA insists that the 8(a) program still has a priority over the 
HUBZone Program.
  SBA has abandoned the protection Congress included in the 1997 law 
when

[[Page S9640]]

it enacted the HUBZone Program. Contrary to the law, SBA is setting up 
the two programs in competition with each other, which is precisely 
what Congress sought to prevent. Putting either program in competition 
with the other is a prescription for one of the programs to fail.
  SBA's position does real harm to minority communities as well. The 
8(a) program has a role to play in ensuring minority communities own 
assets in the economy. It ensures minority business owners get the 
opportunity to be self-supporting, independent citizens with a full 
stake in our economy. It's important that all Americans have a piece of 
the economic pie.
  HUBZones and 8(a) are two prongs of the same fork. They both have a 
vital role to play in ensuring opportunity. That's why it's important 
to correct SBA's current position and to keep the two programs from 
competing with each other. The remedial language that I have withdrawn 
from the Substitute Amendment would have reversed the SBA position and 
restore the equal footing Congress established when it created the 
HUBZone program three years ago. I intend to pursue a comprehensive 
remedy to this problem early next year.
  On November 5, 1999, the Senate approved unanimously S. 1346, a bill 
I introduced to make the SBA Office of Advocacy a stronger, more 
effective advocate for all small businesses throughout the United 
States. This bill was referred to the House Committee on Small Business 
on November 8, 1999, and it has failed since then to take action on 
this important legislation that has the strong support of almost every 
segment of the small business community.
  Consequently, when the Senate Small Business Committee marked up the 
S. 3121, the Small Business Reauthorization Act of 2000, it 
incorporated the entire text of S. 1346 as a separate title. It was the 
committee's intention that this action might spur the House committee 
to take action on this bill. Unfortunately, the Houses remains adamant 
in its opposition. Both Chairman Jim Talent and Ranking Democrat, Nydia 
Velazquez from the House Small Business Committee have insisted that 
the title to strengthen SBA's Office of Advocacy be stricken from the 
bill. Therefore, I am withdrawing S. 1346 in order to clear the way for 
swift passage by the Senate and House of Representatives of H.R. 2392 
with the Bond/Kerry substitute amendment.
  Senator Kerry and I have taken some very dramatic steps to insure 
that the Small Business Reauthorization Act of 2000 is enacted as soon 
as possible. It is critical that the Senate act quickly to adopt the 
substitute amendment to H.R. 2392. Our substitute amendment will have a 
positive impact on nearly every SBA program, from guaranteed business 
loans, to equity investments, to management and technical assistance 
for small businesses and budding entrepreneurs. Now is not the time to 
turn our backs on the critical role played by small businesses in our 
vibrant economy. We need to enact this comprehensive legislation now so 
that small businesses and their employees can receive the full benefit 
of these programs.
  I urge my colleagues in the Senate to vote in favor of this much 
needed bill.
  Mr. KERRY. Mr. President, let me say a few words about the Small 
Business Reauthorization Act of 2000 and the managers' amendment that 
the Senate is considering today. While I applaud the House for their 
action to ensure the continuation of important Small Business 
Administration (SBA) programs, the managers' amendment offered by 
Chairman Bond and myself includes key provisions extending and 
improving important SBA programs. This bill, with the inclusion of the 
managers' amendment, is comprehensive. It reauthorizes all of the SBA's 
programs, setting the funding levels for the credit and business 
development programs, and making improvements where needed. Without 
this legislation, the 504 loan program would shut down; the venture 
capital debenture program would shut down; and funding to the states 
for their small business development centers would be in jeopardy. The 
list goes on. I just can't emphasize enough how important this 
legislation is.
  The SBA's contribution is significant. In the past eight years, the 
SBA has helped almost 375,000 small businesses get more than $80 
billion in loans. That's double what it has loaned in the preceding 40 
years since the agency's creation. The SBA is better run than ever 
before, with four straight years of clean financial audits; it has a 
quarter less staff, but makes twice as many loans; and its credit and 
finance programs are a bargain. For a relatively small investment, 
taxpayers are leveraging their money to help thousands of small 
businesses every year and fuel the economy.
  Let me just give you one example. In the 7(a) program, taxpayers 
spend $1.24 for every $100 loaned to small business owners. Well known 
successes like Winnebago and Ben & Jerry's are clear examples of the 
program's effectiveness.
  Overall, I agree with the program levels in the three-year 
reauthorization bill. As I said during the Small Business Committee's 
hearing on SBA's budget earlier in the year, I believe the program 
levels are realistic and appropriate based on the growing demand for 
the programs and the prosperity of the country. I also think they are 
adequate should the economy slow down and lenders have less cash to 
invest. Consistent with SBA's mission, in good times or bad, we need to 
make sure that small businesses have access to credit and capital so 
that our economy benefits from the services, products and jobs they 
provide. As First Lady Hillary Rodham Clinton says, we don't want good 
ideas dying in the parking lot of banks. We also want a safety net when 
our states are hit hard by a natural disaster. There are many members 
of this Chamber, and their constituents, who know all too well the 
value of SBA disaster loans after floods, fires and tornadoes.
  I will only take a short time to talk about some of important the 
provisions of this bill and our managers' amendment.
  I am pleased that we are considering legislation to extend the Small 
Business Innovation Research (SBIR) program for 8 more years as part of 
this comprehensive SBA reauthorization bill. As many of my colleagues 
may know, this program is set to expire on September 30, along with 
many other important programs critical to our nation's small 
businesses. While I am sorry the process has taken this long, in no way 
should it imply that there is not strong support for the SBIR program, 
the Small Business Administration, or our nation's innovative small 
businesses.
  The SBIR program is of vital importance to the high-technology sector 
throughout the country. For the past decade, growth in the high-
technology field has been a major source of the resurgence of the 
American economy we now enjoy. While many Americans know of the success 
of Microsoft, Oracle, and many of the dot.com companies, few realize 
that it is America's small businesses that are working in industries 
like software, hardware, medical research, aerospace technologies, and 
bio-technology that are helping to fuel this resurgence--and that it is 
the SBIR program that makes much of this possible. By setting aside 
Federal research and development dollars specifically for small high-
tech businesses, SBIR is making important contributions to our economy.
  These companies have helped launch the space shuttle; found a vaccine 
for Hepatitis C; and made B-2 Bomber missions safer and more effective.
  Since the start of the SBIR program in 1983, more than 17,600 firms 
have received over $9.8 billion in assistance. In 1999 alone, nearly 
$1.1 billion was awarded to small high-tech firms through the SBIR 
program, assisting more than 4,500 firms.
  The SBIR program has been, and remains, an excellent example of how 
government and small business can work together to advance the cause of 
both science and our economy. Access to risk capital is vital to the 
growth of small high technology companies, which accounted for over 40 
percent of all jobs in the high technology sector of our economy in 
1998. The SBIR program gives these companies access to Federal research 
and development money and encourages those who do the research to 
commercialize their results. Because research is crucial to ensuring 
that our nation is the leader in

[[Page S9641]]

knowledge-based industries, which will generate the largest job growth 
in the next century, the SBIR program is a good investment for the 
future.
  I am proud of the many SBIR successes that have come from my state of 
Massachusetts. Companies like Advanced Magnetics of Cambridge, 
Massachusetts, illustrate that success. Advanced Magnetics used SBIR 
funding to develop a drug making it easier for hospitals to find tumors 
in patients. The development of this drug increased company sales and 
allowed Advanced Magnetics to hire additional employees. This is 
exactly the kind of economic growth we need in this nation, because 
jobs in the high-technology field pay well and raise everyone's 
standard of living. That is why I am such a strong supporter and 
proponent of the SBIR program and fully support its reauthorization.
  This legislation also includes H.R. 2614, which reauthorizes SBA's 
504 loan program, which passed the Senate on June 14, 2000. The bill 
and our managers' amendment make common-sense changes to this critical 
economic development tool. These changes will greatly increase the 
opportunity for small business owners to build a facility, buy more 
equipment, or acquire a new building. In turn, small business owners 
will be able to expand their companies and hire new workers, ultimately 
resulting in an improved local economy.
  Since 1980, over 25,000 businesses have received more than $20 
billion in fixed-asset financing through the 504 program. In my home 
state of Massachusetts, over the last decade small businesses have 
received $318 million in 504 loans that created more than 10,000 jobs. 
The stories behind those numbers say a lot about how SBA's 504 loans 
help business owners and communities. For instance, in Fall River, 
Massachusetts, owners Patricia Ladino and Russell Young developed a 
custom packing plant for scallops and shrimp that has grown from ten to 
30 employees in just two short years and is in the process of another 
expansion that will add as many as 25 new jobs.
  Under this reauthorization bill, the maximum debenture size for 
Section 504 loans has been increased from $750,000 to $1 million. For 
loans that meet special public policy goals, the maximum debenture size 
has been increased from $1 million to $1.3 million. It has been 
a decade since we increased the maximum guarantee amount. If we were to 
change it to keep pace with inflation, the maximum guarantee would be 
approximately $1.25 million instead of $1 million. Instead of 
implementing such a sharp increase, we are striking a balance between 
rising costs and increasing the government's exposure and only seeking 
to increase the cap to $1 million.

  I am pleased to say that this legislation also includes a provision 
assisting women-owned businesses, which I first introduced in 1998 as 
part of S. 2448, the Small Business Loan Enhancement Act. This 
provision adds women-owned businesses to the current list of businesses 
eligible for the larger public policy loans. As the role of women-owned 
businesses in our economy continues to increase, we would be remiss if 
we did not encourage their growth and success by adding them to this 
list.
  The 504 loan program gets results. It expands the opportunities of 
small businesses, creates jobs and betters communities. It is crucial 
that it be reauthorized, and that is what this legislation does.
  Another important program reauthorized under this legislation and 
strengthened by the managers' amendment is the Microloan program. I 
have long been a believer in microloans and their power to help people 
gain economic independence while improving the communities in which 
they live. This bill authorizes lower levels for the microloan program 
than the Administration requested. Of course, I would prefer to have 
full funding because I believe it is important to expand the program so 
that it is available everywhere. But, compromise is part of the 
legislative process, and a moderate increase is better than none at 
all. Nevertheless, I will be monitoring usage of microloan technical 
assistance and have told Chairman Bond that the Senate Committee on 
Small Business should revisit the issue before the end of the three-
year reauthorization period if the level authorized is inadequate to 
meet program needs.
  In addition to funding, our managers' amendment also makes important 
changes to the microloan program. We have heard from intermediaries and 
economic development activists around the country that with some 
administrative and legislative changes, this program could have a 
greater impact. This bill takes some important steps in the right 
direction. Right now we have 156 microlending intermediaries. This bill 
will permit the program to grow to 250 in FY 2001; to 300 in FY 2002, 
and to 350 in FY 2003. It also increases loan levels and technical 
assistance levels over three years. With more technical assistance, we 
will be able to increase the number of intermediaries, and therefore 
reach more borrowers in rural areas or large states. I also support the 
provision to raise the cap on microloans from $25,000 to $35,000, 
making it adequate to help micro-entrepreneurs in states and urban 
areas where operating costs are more expensive. Senator Snowe's 
provision to establish $1 million for peer-to-peer training for 
microlenders is also included. I strongly support this concept because 
it will help the program grow while maintaining its high quality and 
low loss rates.
  Small Business Development Centers (SBDC) are also reauthorized under 
this legislation. SBDCs serve tens of thousands of small business 
owners and prospective owners every year. This bill takes a giant step 
to retool the formula that determines how much funding each state 
receives. This is an important program for all of our states and we 
want no confusion about its funding. Without this change, some states 
would have suffered sharp decreases in funding, disproportionate to 
their needs. I appreciate and am glad that the SBA and the Association 
of Small Business Development Centers worked with me to develop an 
acceptable formula so that small businesses continue to be adequately 
served.
  This legislation also reauthorized the National Women's Business 
Council. For such a tiny office, with minimal funding and staff, it has 
managed to make a significant contribution to our understanding of the 
impact of women-owned businesses in our economy. It has also done 
pioneer work in raising awareness of business practices that work 
against women-owned business, such as some in the area of Federal 
procurement. Recently, they completed two studies that documented the 
world of Federal procurement and its impact on women-owned businesses.
  According to the National Foundation for Women Business Owners, over 
the past decade, the number of women-owned businesses in this country 
has grown by 103 percent to an estimated 9.1 million firms. These firms 
generate almost $3.6 trillion in sales annually and employ more than 
27.5 million workers. With the impact of women-owned businesses on our 
economy increasing at an unprecedented rate, Congress relies on the 
Council to serve as its eyes and ears as it anticipates the needs of 
this burgeoning entrepreneurial sector. Since it was established in 
1988, the bipartisan Council has provided important unbiased advice and 
counsel to Congress.
  This Act recognizes the Council's work and reauthorizes it for three 
years, from FY 2001 to 2003. It also increases the annual appropriation 
from $600,000 to $1 million. The increase in funding will allow the 
council to: support new and ongoing research; produce and distribute 
reports and recommendations prepared by the Council; and create an 
infrastructure to assist states develop women's business advisory 
councils, coordinate summits and establish an interstate communication 
network.
  The Historically Underutilized Business Zone, or ``HUBZone'' program, 
which passed this Committee in 1997, has tremendous potential to create 
economic prosperity and development in those areas of our Nation that 
have not seen great rewards, even in this time of unprecedented 
economic health and stability. This program is similar to my New 
Markets legislation in that it creates an incentive to hire from, and 
perform work in, areas of this country that need assistance the most. 
This bill would authorize the HUBZone program at $10 million for the 
next 3 years, which is $5 million above the Administration's request.

[[Page S9642]]

  Additionally, the managers' amendment included very important 
provisions to include those areas which were inadvertently missed when 
this legislation was crafted--namely, Indian tribal lands. I appreciate 
the willingness of the Committee on Indian Affairs to work with our 
Committee to create HUBZone opportunities in the states of Alaska and 
Hawaii, and in other Indian tribal lands.
  The HUBZone section does not contain any provision addressing the 
interaction of the HUBZone and 8(a) minority contracting programs. I 
believe that the 8(a) program is an important and necessary tool to 
help minority small businesses receive access to government contracts. 
The Chairman and I agree that there is a need to enhance the 
participation of both 8(a) and HUBZone companies in Federal 
procurement. It is my intention that the Senate Committee on Small 
Business consider the issue of enhancing small business procurement in 
the next Congress.
  The Senate managers' amendment also includes a provision relating to 
SBA's cosponsorship authority. This authority allows SBA and its 
programs to cosponsor events and activities with private sector 
entities, thus leveraging the Agency's limited resources. The managers' 
amendment extends the authority for three additional years. This 
provision also adds ``information and education'' to the types of 
assistance that can be provided to small businesses by public and 
private sector organizations working with the SBA. This provision was 
recommended by the SBA as an effective change to training programs that 
are jointly run by the SBA and partner organizations.
  Mr. President, let me conclude by reminding my colleagues that all of 
our states benefit from the success and abundance of small businesses. 
This legislation makes their jobs a little easier. I ask my colleagues 
for their support of this important legislation.

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