[Congressional Record Volume 149, Number 167 (Tuesday, November 18, 2003)]
[Senate]
[Pages S15069-S15079]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]

      By Mr. DASCHLE (for Mr. Kerry):
  S. 1886. A bill to amend the Small Business Act and the Small 
Business Act of 1958 to establish the National Office for the 
Development of Small Manufacturers, to increase the level of assistance 
available for small manufacturers, and for other purposes; to the 
Committee on Small Business and Entrepreneurship.
  (At the request of Mr. Daschle, the following statement was ordered 
to be printed in the Record.)
 Mr. KERRY. Mr. President, I come to the floor today to 
introduce three bills to address the growing needs of small 
manufacturers, to stimulate the manufacturing sector of our economy, 
and to put back to work the millions of American workers in the 
manufacturing sector that have lost their jobs in the past 3 years. The 
three comprehensive bills are: the Manufacturing Assistance, 
Development and Education (MADE) in America Act, the Enhance Domestic 
Manufacturing and Worker Assistance Act, and the Manufacturing Jobs 
Production Act.
  It's no secret that during the past 3 years, manufacturing employment 
in the United States has declined from 17.3 million to 14.6 million 
jobs. This loss of manufacturing jobs represents a loss of more than 
one in every seven such jobs. Over the past 3 years, the United States 
has lost an average of 80,000 manufacturing jobs a month. The States 
that rely the most on their manufacturing sector have suffered the most 
during the past 3 years. Indiana has lost 67,000 manufacturing jobs, 
California--297,000, Ohio--152,000, Illinois--126,000, Michigan--
127,000, Pennsylvania--133,000, South Carolina--55,200, and North 
Carolina--145,300. Even in my home State of Massachusetts, we have lost 
approximately 80,000 manufacturing jobs since January 2001.
  The loss of manufacturing jobs is of great concern because the 
manufacturing sector is more important than any other sector in 
supporting overall economic growth, technological innovation, and a 
high standard of living for Americans. Over the past 10 years, 
manufacturers have performed nearly 60 percent of research and 
development in the United States and have paid over one-third of all 
corporate tax payments to State and local governments.
  Further, replacing manufacturing jobs with service sector jobs will 
not help stabilize the American economy. According to a University of 
Michigan study, 6.5 spin-off jobs are created as a result of every new 
job created in manufacturing. Service sector jobs simply cannot 
generate that type of economic activity. The benefits of manufacturing 
can also be found in national salary averages. In 2001, salaries and 
benefits averaged $54,000 in the manufacturing sector, while the 
average salary and benefits package in the private sector overall was 
only $45,600.
  In 1955, manufacturing jobs were 30.5 percent of all U.S. employment, 
today they make up just 14 percent. The manufacturing decline has been 
marked by a relocation of factories abroad along with reduced exports 
and increased imports of manufactured goods. Both large and small 
companies have been affected and a continued shrinking of the 
manufacturing base may shift the manufacturing innovation process to 
other global centers and most certainly result in a decline in U.S. 
living standards.
  As a member of the Finance and Commerce committees and ranking member 
of the Senate Committee on Small Business and Entrepreneurship, I have 
been fighting for the creation of new manufacturing jobs during debate 
over the President's tax cuts, and I will continue to do so in the 
months ahead. President Bush has done nothing to address the loss of 
manufacturing jobs, and many communities across the country are 
suffering because of it, as more and more plants close and more and 
more jobs move overseas. This administration is indifferent to these 
changes, and the pain being felt in million of American households, and 
that's unacceptable.
  In fact, indifferent may be too kind a word. The Bush administration 
has been downright cruel to working Americans, pursuing billions of tax 
cuts for the most well-off in our society as their only economic 
policy, while millions of hard-working Americans have lost their jobs 
and will be left with the bill from this administration's reckless 
fiscal policies. In fact, you could argue that the manufacturing jobs 
picture is actually worse than the hard numbers tell us. While many 
estimates show that 2.5 million manufacturing jobs have been lost since 
President Bush took office, in previous postwar recoveries, 
manufacturing employment had recovered by this point in the business 
cycle and risen by more than 5 percent. Under the Bush presidency, 
manufacturing employment has continued to deteriorate steadily, falling 
so far by 8 percent. Morgan Stanley's respected economists tell us that 
the difference represents 2.1 million additional manufacturing jobs. 
More supply-side, trickle-down, ideologically driven tax cuts are not 
going to turn this around. Congress needs to take action and pass some 
policies that are meaningful to people, and will actually create jobs, 
and soon.
  The President and his followers insist that his tax cuts are starting 
to work, basing their claims on a couple of months where the overall 
job creation numbers were positive. But the truth is that the meager 
job gains of the last three months have done little to lift most parts 
of the economy because nearly 80 percent of those small gains have come 
in just three sectors: government, temporary staffing, and education 
and health services. Manufacturing is not yet on the mend, and people 
who are finding new jobs are finding jobs at lower pay. We need to take 
action.
  Small-business owners have made it clear to me, to Congress, and to 
the administration what actions are needed to reinvigorate the 
manufacturing sector. Unlike the Bush administration, which has ignored 
these requests for help, Congress must have the courage to make the 
tough decisions and not simply pander to wealthy Americans and giant 
corporations with unbalanced tax cuts. The Nation's gross domestic 
product may be temporarily up, but manufacturing jobs are still way 
down. To get those jobs back, and to continue competing on the 
international stage, our manufacturers, particularly our small 
manufacturers, need adequate representation and leadership at all 
levels of government, here and abroad. They need a well-educated, 
highly skilled, productive labor force; Federal contracting and 
subcontracting opportunities; greater access to capital; foreign patent 
protection; trade adjustment, global marketing, and entrepreneurial 
development assistance; and responsible, targeted tax credits. This 
legislation addresses those needs, while the President's tax cuts 
continue to undercut them.
  Mr. President, we often receive complaints that the Federal and State 
small business programs duplicate, rather than complement, each other. 
While the SBA has stated that it has sufficient systems and programs in 
place to address the concerns of manufacturers, statistics on small 
manufacturers, as well as the business owners themselves, prove 
otherwise. Many state that accessing these programs is often confusing 
and difficult because they are fragmented, spread out and not tailored 
to bridge gaps found between State and Federal assistance programs. To 
address these problems, my bill will create the National Office for the 
Development of Small Manufacturers at the Small Business 
Administration, led by an associate administrator. This new office will 
be responsible for coordinating and strengthening existing programs, as 
well as establishing new SBA programs to address the needs of small 
manufacturers and to promote programs throughout the Federal Government 
that assist small- and medium-size manufacturers. While the President 
has established a ``new'' manufacturing czar at the Department of 
Commerce, this action is seen as lateral movement and does nothing to 
assist those manufacturers that are suffering the most, the Nation's 
small business manufacturers.

  Once established, the National Office for the Development of Small 
Manufacturers will be responsible for implementing a Manufacturing 
Corps through block grants to each State that will address the skilled 
worker crisis in this country by promoting technical education 
pertinent to the manufacturing sector. First, the Manufacturing Corps 
would help current manufacturing workers improve their

[[Page S15070]]

skill set and advance their technical abilities. Each State's grant 
would ultimately provide small manufacturers with more highly skilled 
workers--something that the industry has posed as a global competitive 
disadvantage--and allow the unemployed and those in declining 
industries to make the pivotal move back to work or to other 
manufacturing sectors, respectively.
  Second, the Manufacturing Corps would help small manufacturers fill 
their skilled labor needs by encouraging college and university 
students studying engineering, computers, and other high-tech fields to 
work in the small manufacturing sector by offering to repay a portion 
of their student loans if they do so for a specified period of time. 
Similar to incentives for students going into the nonprofit or 
government work, the government would repay the loans of those who 
commit to working for a small manufacturer for 4 years following 
graduation if their annual employment compensation does not exceed 
$60,000.
  Third, the Manufacturing Corps would establish a vocational and 
technology training for students at the high school level to prepare 
students who are not planning to attend college directly after 
graduation to enter the manufacturing sector. As in woodshop or auto 
shop courses, high school students will learn the technical skills to 
become effective, skilled manufacturing employees, such as machinists 
or metal workers. Additionally, schools providing such assistance would 
partner with community manufacturers to address their skilled worker 
needs and to provide employment opportunities for students after 
graduation.
  Another duty charged to the National Office for the Development of 
Small Manufacturers is to create a government-wide ``One Stop Small 
Manufacturing Shop'' for small manufacturers. This online web portal 
will serve as the single point of contact for information on 
entrepreneurial development assistance, access to capital, specific 
outreach programs, contracting opportunities, and R&D projects. We 
already have successful programs that can be used as a prototype for 
the web page such as the National Industrial Manufacturing Assistance 
Program's Web site at the Office of Industrial Technologies at the 
Department of Energy.
  The greatest challenge to small businesses, as with all businesses, 
is the ability to obtain contracts. The BusinessLINC program within the 
SBA has been proven, since its inception, to successfully match small 
businesses with potential clients. The teaming model has created 
thousands of jobs and millions of dollars in contracts. The 
BusinessLINC-M program will also team small businesses with non-
governmental organizations that can have a direct impact on their 
bottom-line through contracting or mentoring. There is a great 
potential for the BusinessLINC-M program to match suppliers with 
distributors, offer contracting and subcontracting opportunities, which 
directly benefits the local economy while allowing access to vendors in 
the distributors' backyards. The National Office for the Development of 
Small Manufacturers will create a similar program to foster symbiotic 
partnerships between small and large businesses to spur contracting 
opportunities. This BusinessLINC-M program would instead match up small 
manufacturers with larger firms that could utilize their products, 
creating subcontracting opportunities and a stronger supply chain.

  Finally, the National Office for the Development of Small 
Manufacturers will develop a manufacturing mentor-protege program to 
focus on improving the management practices, domestic and foreign 
marketing abilities, efficiency, and product development of small 
manufacturers by pairing them with larger, more experienced 
manufacturers that would provide such guidance.
  One of the first things we can do to help small manufacturers is to 
tailor the SBA's loan and venture capital programs so that they offer 
small manufacturers affordable, long-term financing in amounts that are 
truly appropriate for them. This legislation will assist small 
businesses with fixed-asset costs, working capital, loan dollars to 
help them export what they have produced in the United States, and 
venture capital investments to spur expansion and growth.
  To provide that capital, we have increased the loan amounts available 
to small manufacturers, increased venture leverage, and allowed 
refinancing of certain existing business debt. The maximum 504 loan, 
for equipment and property, will be raised from $1 million to $4 
million, the maximum microloan will be raised from $35,000 to $50,000, 
and the gross loan amount for 7(a) working capital loans will increase 
from $1 million to $4 million for small manufacturers.
  Investors should be encouraged to devote more of their money to the 
fastest growing small manufacturers. The SBIC program can provide that 
venture capital money. Under this bill, if SBICs invest 50 percent in 
small manufacturers, then a single fund can leverage $150 million 
instead of $115 million and a manager with several SBICs can leverage 
$185 million from the SBA. The legislation also restores and increases 
funding to establish additional New Markets Venture Capital firms and 
increases the SBA's leverage against private funds raised in the New 
Markets Venture Capital program from 150 percent to 200 percent so 
these venture capital firms can invest more in small manufacturers.
  For growing small businesses using the loans from the 504 program to 
buy new equipment or buildings, we raise the limit for lenders so that 
they must create or retain one job for every $100,000 loaned to 
manufacturers. This is in place of the $35,000 that is currently in 
place. For non-manufacturers, it will be raised to $50,000. For 
manufacturers, the costs of retaining jobs are higher, and we want 
these jobs to be good living wages and not the $3 per hour or lower 
that exists in some countries.
  After a natural disaster, the already slumping manufacturing industry 
faces an even greater challenge in returning business to normal and 
affording the costs of repair. Recognizing that they face these 
problems, the MADE in America Act changes several provisions to the 
SBA's disaster loan program. It increases the maximum loan size from 
$1.5 million to $5 million; allows small manufacturers to consolidate 
debt by refinancing not just existing disaster loans but any 
outstanding business loan; waives the principal and interest payments 
for 6 months; authorizes the administration to waive unreasonable size 
limitations; and prohibits the SBA from selling all disaster loans to 
other creditors. Disaster loans, at the most, have an interest rate of 
4 percent and terms of up to 30 years. This low rate and long term 
keeps manufacturers' payments down as well as their debt, particularly 
when they refinance their more expensive business loans.

  To help small manufacturers and small R&D firms, we need to reduce 
trade barriers, so that they are able to sell their products and 
technologies in other countries. Small-business owners commonly cited 
the expense required to secure foreign patent protection as a 
significant barrier to their ability to operate in international 
markets. Part of encouraging the spread of their innovations into other 
countries is decreasing their vulnerability to big foreign corporations 
that can take their ideas when they try to sell their products around 
the world. Our small businesses need patent protection. However, the 
costs associated with filing such patents are often prohibitively 
expensive.
  For example, Mr. Clifford Hoyt, who is vice president and chief 
technology officer of Cambridge Research and Instrumentation, testified 
on June 21, 2001, as part of the Committee's hearing on reauthorization 
of the STTR program that cost of ``patent protection in Europe is 
$20,000.'' Information from the American Intellectual Property Law 
Association's meeting shows that the costs of foreign patents range 
from $7,200 in Canada to $27,200 in Japan. Those costs include fees for 
filing, examination, translation and attorneys.
  With this legislation, to address the intellectual property problem 
for small exporters, I propose enacting a variation of a bill I 
introduced 2 years ago. The MADE in America Act would establish a self-
sustaining grant fund to help small manufacturers and R&D firms pay for 
the cost associated with foreign patent protection. Each company would 
be limited to one grant and, in order to be eligible for the

[[Page S15071]]

grant, it must have already filed for patent protection in the United 
States. Both of these provisions are designed to ensure, to the extent 
possible, that companies apply for assistance for their most promising 
technology and therefore are in the best position to return money to 
the grant fund when their patented technology becomes profitable. By 
giving the companies only one shot at a grant to protect and make money 
from their technologies, it forces them to select the one most likely 
to succeed and have sales. At the same time, requiring companies to 
have already filed for patent protection in the United States prior to 
seeking a foreign patent grant is a gauge of the company's confidence 
in the commercial potential of its technology.
  Ultimately, the goal is to create a self-sustaining grant fund. To do 
so, in return for the grants, each recipient would be obligated to pay 
5 percent of its related export sales or licensing fees to the fund, to 
be known as the ``Small Business Foreign Patent Protection Grant 
Fund.'' To maintain a reasonable incentive for the small businesses, 
the total amount recipients would be required to pay would be capped at 
four times the amount of the grant, which for a $25,000 grant would be 
$100,000.
  When I first introduced this bill a couple of years ago, the grants 
were limited to companies that participate in the SBA's SBIR and STTR 
programs. However, this bill opens the grant funding to all small 
firms, while reserving 50 percent of the money for SBIR and STTR firms 
through the first three quarters to each year. Intellectual property 
protection is critical to these small firms that have a great product 
or invention, and keeping these innovations in the hands of American 
firms is important to the U.S. economy.
  Mr. President, today I am also introducing the Enhance Domestic 
Manufacturing and Worker Assistance Act. America's manufacturing 
decline and the associated loss of good, stable manufacturing jobs has 
been marked by a relocation of factories abroad along with reduced 
exports and increased imports of manufactured goods. This legislation 
will respond to the manufacturing crisis in two ways. The proposal 
recognizes the harmful impact that trade has on small manufacturers and 
provides assistance to those workers, companies and communities that 
have suffered through Trade Adjustment Assistance programs. The 
proposal also provides critical assistance to U.S. domestic 
manufacturers to ensure that they adjust to the global economy and 
remain competitive in the 21st century.

  First of all, for those workers, businesses and communities that have 
been harmed by trade, my bill assists them by reauthorizing our Trade 
Adjustment Assistance programs for workers and business firms. The bill 
includes elements of an innovative program to assist similarly situated 
communities. Recognizing that entire communities experience economic 
displacement, this proposal will assist harmed communities in exploring 
new avenues of economic development and job creation. Combined, these 
programs will assist hundreds of mostly small- and medium-sized 
manufacturing and agricultural companies that experience loss of jobs 
and sales due to import competition and other adverse consequences of 
trade. For example, TAA for workers provides income support, job search 
and worker relation assistance for affected workers.
  Next, my legislation will enhance two programs that have proven 
effective in assisting domestic manufacturing firms. For example, the 
bill will strengthen the very effective Manufacturing Extension 
Partnership program. This program assists struggling small- and medium-
size manufacturers to modernize, increase productivity, cut waste, 
achieve higher profits, and compete in the demanding global market. 
With increased funding, the MEP program can expand its program reach 
and decrease the fees paid by small manufacturers to access the 
assistance. It is exactly this type of program that will make American 
manufacturers competitive again, allowing them to maintain existing 
jobs and create additional high-skilled and high-paying jobs in the 
United States.
  In addition, my legislation increases funding for the Advanced 
Technology Partnership program. This very important program fosters 
public-private partnerships to accelerate the development of innovative 
technologies and bridges the gap between the research lab and the 
market place. The program has been very effective in accelerating the 
development of innovative technologies that promise significant 
commercial payoffs and widespread benefits for the Nation. 
Unfortunately, the Bush administration has sought to eliminate this 
program, at a time when technological change is faster than ever before 
and small manufacturers must be technologically competitive.
  Strengthening the MEP and ATP programs will go a long way in 
assisting small domestic manufacturers as they attempt to regain market 
share lost to international competition and recover from the resulting 
devastating job losses.
  Finally, this bill will also create an ``Office of Small Business'' 
within the Office of the United States Trade Representative that will 
focus on the issues affecting small- and medium-size manufacturers as 
they relate to our international trade policy. This proposal is very 
similar to a proposal that I offered with Senator Olympia Snowe in the 
107th Congress. Small manufacturers are directly impacted by our trade 
policies--often adversely--yet they do not have a seat at the table and 
lack the ability to effectively express their concerns. The 
establishment of this office will ensure that issues important to small 
manufacturers are taken into consideration as our Nation's trade policy 
is carried out in the future and will assist small businesses in export 
promotion and trade compliance.

  The final piece of my legislation plan to enhance U.S. manufacturing 
is my bill titled the ``Manufacturing Job Production Act.'' The bill 
has four components, all of which are fiscally responsible. None of 
them will by themselves completely make up for the jobs lost during 
this administration, but they will each do their part in stimulating 
new job creation and new investment in manufacturing firms.
  The first component of my plan is a Temporary Manufacturing Job 
Creation Tax Credit. It is a similar proposal to one I introduced 
earlier this year, when we were debating the President's third major 
tax cut in 3 years. My idea is straightforward: Any domestic 
manufacturer would receive an income tax credit based on a percentage 
of the net increase in taxable Social Security payroll linked to new 
manufacturing/production jobs, comparing total applicable payroll for 
one year to the previous year, adjusted for inflation. The credit would 
apply only to domestic production/manufacturing jobs created in 2004 
and 2005, and it would include jobs created in U.S. territories, and 
those created by foreign-owned companies in the United States or its 
territories.
  Unlike many of the administration's tax cuts, which carry huge costs 
at the vague promise of a positive economic result, my idea is outcome-
based because it only costs money if it actually works. Plus, it has a 
built-in safety valve to prevent abuse, because it prevents firms from 
receiving tax credits if they create new manufacturing jobs while 
simultaneously laying off other workers, and it stops companies from 
tilting the benefits to high-salary workers because these salaries are 
already above the Social Security payroll tax cap. By comparing payroll 
taxes paid over a whole year, it also provides an incentive for firms 
to hire new workers and keep them on payroll and makes the calculation 
simple for businesses. It also provides an employment stimulus for U.S. 
companies with subsidiaries or manufacturing facilities on U.S. 
possessions, such as Puerto Rico.
  My proposal would be in place for 2 years, and the Joint Committee on 
Taxation estimates that it would cost less than $4 billion. Surely we 
could pass this proposal and offset its modest cost by finally closing 
some of the Enron tax loopholes or passing the corporate inversion 
proposals that have previously passed this body unanimously, only to be 
opposed by the House. I think the percentage of Americans that would 
support that tradeoff would be upwards of 80 percent. Paying for this 
proposal by closing tax loopholes for wealthy corporation makes perfect 
sense. It will help our economy grow and help slow the flow of 
manufacturing jobs overseas.

[[Page S15072]]

  The second element of may plan expands upon a capital gains provision 
that I have included in other legislation. Section 4 of S. 842, my 
small business tax stimulus bill, provides that there shall be no 
capital gains tax applied to new equity investments in small businesses 
with gross sales under $100 million, if the investments are held for at 
least 4 years. The zero capital gains tax applies to businesses 
involved in certain ``critical technologies'' as well as specialized 
Small Business Investment Companies, or SSBICs. For the Manufacturing 
Job Production Act, this capital gains proposal is expanded to include 
new equity investments in small manufacturing firms. Such a proposal 
should generate new investments in manufacturing, particularly small 
manufacturing companies that have been so damaged by recent economic 
trends. And like the job creation credit, it only costs significant 
money if it has the desired effect. That factor alone makes it far 
preferable to the Republican ``throw it and see if it sticks'' tax cut 
strategy.

  The third part of my manufacturing plan is a revised BRIDGE Act, 
designed to give a little extra boost to small manufacturers. The 
BRIDGE Act stands for Business Retained Income During Growth and 
Expansion. It will help ensure that rapidly expanding, entrepreneurial 
businesses have access to the capital they need to continue creating 
jobs and stimulating the economy.
  Each year, the United States economy generates 600,000 to 800,000 new 
businesses. Most new business start small and stay small--but some 
evolve into fast-growth companies with the capacity to propel the 
economy forward. These fast-growing companies create the most new jobs, 
yet access to financing--particularly in the current economic 
environment, but also when the economy is strong--presents a pivotal 
challenge to them. A typical startup may open its doors with a 
combination of personal savings, credit card borrowing, and family 
lending. Once a business has grown past a certain size--say, when sales 
reach $10 million or more--the company is better able to attract 
external financing at a reasonable cost. However, there are many 
companies in a middle range, including many small manufacturers, which 
desperately need additional financing in the range of $250,000 to $1 
million. These companies face a severe credit crunch that limits their 
growth and the number of new jobs they can create.
  I believe that if congress does anything to assist small 
manufacturers, it should take steps to ease the credit crunch for those 
climbing the economic ladder from small- to medium-size enterprise, 
thereby generating new ones. The BRIDGE Act addresses this financing 
gap. As ranking member of the Committee on Small Business and 
Entrepreneurship, I have been the leading voice for this idea in the 
Senate, and it is something worth trying. Like my other proposals for 
tax relief for small manufacturers, it only generates cost to taxpayers 
if it actually works.
  The BRIDGE Act is simple. It would allow a fast-growing business with 
less than $10 million in sales to temporarily defer up to $250,000 of 
its Federal income tax liability, but only if the money is reinvested 
in the company. The 2-year deferral would be repayable wit interest 
over a 4-year period. For small manufacturers, the maximum tax deferral 
would be $400,000, and the payback period would be extended to a 
maximum of 6 years. Thus, the act will free up new investment capital 
for growing companies by allowing them to use a portion of their 
Federal tax liability for self-financing. Its revenue cost is minimal--
in fact, if the program is implemented temporarily, as in my bill, it 
actually raises a small amount in the 10-year budget window--since the 
deferred taxes are paid back with interest.
  The fourth and final component of my tax relief plan for small 
manufacturers is to make permanent the increase in Section 179 small 
business expensing that was passed earlier this year as part of the 
President's third tax cut. However, this increase is set to expire at 
the end of 2005. While the recent increase does not help the smallest 
of small businesses, it can be helpful to small manufacturers who 
purchase more expensive equipment. It is one element of the various 
Bush tax cuts that deserves to be made permanent. My proposal would 
permanently increase the annual expensing limit to $100,000.
  Mr. President, we may not have all the answers here in the Congress. 
Some of these trends in manufacturing employment have taken a long time 
to develop, and we won't be able to turn them around overnight. But at 
least we shouldn't ignore the changes and act as if more tax cuts will 
solve the problem. My manufacturing tax plan contains four reasonable, 
responsible components--and most will cost money only if they are 
actually effective. It's time for this administration to get its head 
out of the sand and start proposing job-creating strategies that will 
actually work.
  Mr. President, nearly 3 million Americans, all across this Nation, 
have lost their jobs since 2000. We need to act now, with a 
comprehensive strategy that not only incorporates tax cuts but also 
includes real job training, business development, capital access, and 
levels the playing field for U.S. manufacturers. I believe this 
legislation addresses many of the concerns of the small business 
community and will take a significant step towards reversing the 
current trend of economic decline and job loss in the manufacturing 
sector.
  I ask unanimous consent that the text of the MADE in America Act, the 
Enhance Domestic Manufacturing and Worker Assistance Act, and the 
Manufacturing Jobs Production Act be printed in the Record, and I urge 
all of my colleagues to support these bills.
  There being no objection, the bills were ordered to be printed in the 
Record, as follows:

                                S. 1884

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

     SECTION 1. SHORT TITLE.

       This Act may be cited as the ``Enhance Domestic 
     Manufacturing and Worker Assistance Act of 2003''.

    TITLE I--EXTENSION AND EXPANSION OF TRADE ADJUSTMENT ASSISTANCE

     SEC. 101. EXTENSION FOR WORKERS AND FIRMS.

       (a) In General.--Section 285 (a) and (b) (1) and (2) of the 
     Trade Act of 1974 (19 U.S.C. 2271 note) are amended by 
     striking ``September 30, 2007'' each place it appears and 
     inserting ``September 30, 2012''.
       (b) Authorization.--
       (1) Workers.--Section 245 of the Trade Act of 1974 (19 
     U.S.C. 2317) is amended by striking ``September 30, 2007'' 
     and inserting ``September 30, 2012''.
       (2) Firms.--
       (A) In general.--Section 256(b) of the Trade Act of 1974 
     (19 U.S.C. 2346(b)) is amended--
       (i) by striking ``$16,000,000'' and inserting 
     ``$32,000,000''; and
       (ii) by striking ``2007'' and inserting ``2012''.
       (B) Expansion of loans.--Section 255(h) of such Act (19 
     U.S.C. 2345) is amended--
       (i) in paragraph (1), by striking ``$3,000,000'' and 
     inserting ``$6,000,000''; and
       (ii) in paragraph (2), by striking ``$1,000,000'' and 
     inserting ``$2,000,000''.
       (3) Farmers.--Section 298(a) of the Trade Act of 1974 (19 
     U.S.C. 2401g) is amended by striking ``2007'' and inserting 
     ``2012''.
       (c) Fishermen.--Notwithstanding any other provision of law, 
     for purposes of chapter 2 of title II of the Trade Act of 
     1974 (19 U.S.C. 2271 et seq.) fishermen who harvest wild 
     stock shall be eligible for adjustment assistance to the same 
     extent and in the same manner as a group of workers under 
     such chapter 2.

     SEC. 102. TRADE ADJUSTMENT ASSISTANCE FOR COMMUNITIES.

       (a) In General.--Chapter 4 of title II of the Trade Act of 
     1974 (19 U.S.C. 2371 et seq.) is amended to read as follows:

        ``CHAPTER 4--TRADE ADJUSTMENT ASSISTANCE FOR COMMUNITIES

     ``SEC. 271. DEFINITIONS.

       ``In this chapter:
       ``(1) Affected domestic producer.--The term `affected 
     domestic producer' means any manufacturer, producer, farmer, 
     rancher, fisherman or worker representative (including 
     associations of such persons) that was affected by a finding 
     under the Antidumping Act of 1921, or by an antidumping or 
     countervailing duty order issued under title VII of the 
     Tariff Act of 1930.
       ``(2) Agricultural commodity producer.--The term 
     `agricultural commodity producer' has the same meaning as the 
     term `person' as prescribed by regulations promulgated under 
     section 1001(5) of the Food Security Act of 1985 (7 U.S.C. 
     1308(5)).
       ``(3) Community.--The term `community' means a city, 
     county, or other political subdivision of a State or a 
     consortium of political subdivisions of a State that the 
     Secretary certifies as being negatively impacted by trade.
       ``(4) Community negatively impacted by trade.--A community 
     negatively impacted by trade means a community with respect 
     to which a determination has been made under section 273.

[[Page S15073]]

       ``(5) Eligible community.--The term `eligible community' 
     means a community certified under section 273 for assistance 
     under this chapter.
       ``(6) Fisherman.--
       ``(A) In general.--The term `fisherman' means any person 
     who--
       ``(i) is engaged in commercial fishing; or
       ``(ii) is a United States fish processor.
       ``(B) Commercial fishing, fish, fishery, fishing, fishing 
     vessel, person, and united states fish processor.--The terms 
     `commercial fishing', `fish', `fishery', `fishing', `fishing 
     vessel', `person', and `United States fish processor' have 
     the same meanings as such terms have in the Magnuson-Stevens 
     Fishery Conservation and Management Act (16 U.S.C. 1802).
       ``(7) Job loss.--The term `job loss' means the total or 
     partial separation of an individual, as those terms are 
     defined in section 247.
       ``(8) Secretary.--The term `Secretary' means the Secretary 
     of Commerce.

     ``SEC. 272. COMMUNITY TRADE ADJUSTMENT ASSISTANCE PROGRAM.

       ``(a) Establishment.--Within 6 months after the date of 
     enactment of the Enhance Domestic Manufacturing and Worker 
     Assistance Act of 2003, the Secretary shall establish a Trade 
     Adjustment Assistance for Communities Program at the 
     Department of Commerce.
       ``(b) Personnel.--The Secretary shall designate such staff 
     as may be necessary to carry out the responsibilities 
     described in this chapter.
       ``(c) Coordination of Federal Response.--The Secretary 
     shall--
       ``(1) provide leadership, support, and coordination for a 
     comprehensive management program to address economic 
     dislocation in eligible communities;
       ``(2) coordinate the Federal response to an eligible 
     community--
       ``(A) by identifying all Federal, State, and local 
     resources that are available to assist the eligible community 
     in recovering from economic distress;
       ``(B) by ensuring that all Federal agencies offering 
     assistance to an eligible community do so in a targeted, 
     integrated manner that ensures that an eligible community has 
     access to all available Federal assistance;
       ``(C) by assuring timely consultation and cooperation 
     between Federal, State, and regional officials concerning 
     economic adjustment for an eligible community; and
       ``(D) by identifying and strengthening existing agency 
     mechanisms designed to assist eligible communities in their 
     efforts to achieve economic adjustment and workforce 
     reemployment;
       ``(3) provide comprehensive technical assistance to any 
     eligible community in the efforts of that community to--
       ``(A) identify serious economic problems in the community 
     that are the result of negative impacts from trade;
       ``(B) integrate the major groups and organizations 
     significantly affected by the economic adjustment;
       ``(C) access Federal, State, and local resources designed 
     to assist in economic development and trade adjustment 
     assistance;
       ``(D) diversify and strengthen the community economy; and
       ``(E) develop a community-based strategic plan to address 
     economic development and workforce dislocation, including 
     unemployment among agricultural commodity producers, and 
     fishermen;
       ``(4) establish specific criteria for submission and 
     evaluation of a strategic plan submitted under section 
     274(d);
       ``(5) establish specific criteria for submitting and 
     evaluating applications for grants under section 275; and
       ``(6) administer the grant programs established under 
     sections 274 and 275.

     ``SEC. 273. CERTIFICATION AND NOTIFICATION.

       ``(a) Certification.--Not later than 45 days after an event 
     described in subsection (c)(1), the Secretary of Commerce 
     shall determine if a community described in subsection (b)(1) 
     is negatively impacted by trade, and if a positive 
     determination is made, shall certify the community for 
     assistance under this chapter.
       ``(b) Determination That Community Is Eligible.--
       ``(1) Community described.--A community described in this 
     paragraph means a community with respect to which--
       ``(A) the Secretary of Labor certifies a group of workers 
     (or their authorized representative) in the community as 
     eligible for assistance pursuant to section 223;
       ``(B) the Secretary of Commerce certifies a firm located in 
     the community as eligible for adjustment assistance under 
     section 251;
       ``(C) the Secretary of Agriculture certifies a group of 
     agricultural commodity producers (or their authorized 
     representative) in the community as eligible for adjustment 
     assistance under section 293;
       ``(D) an affected domestic producer is located in the 
     community; or
       ``(E) the Secretary determines that a significant number of 
     fishermen in the community is negatively impacted by trade.
       ``(2) Negatively impacted by trade.--The Secretary shall 
     determine that a community is negatively impacted by trade, 
     after taking into consideration--
       ``(A) the number of jobs affected compared to the size of 
     workforce in the community;
       ``(B) the severity of the rates of unemployment in the 
     community and the duration of the unemployment in the 
     community;
       ``(C) the income levels and the extent of underemployment 
     in the community;
       ``(D) the outmigration of population from the community and 
     the extent to which the outmigration is causing economic 
     injury in the community; and
       ``(E) the unique problems and needs of the community.
       ``(c) Definition and Special Rules.--
       ``(1) Event described.--An event described in this 
     paragraph means one of the following:
       ``(A) A notification described in paragraph (2).
       ``(B) A certification of a firm under section 251.
       ``(C) A finding under the Antidumping Act of 1921, or an 
     antidumping or countervailing duty order issued under title 
     VII of the Tariff Act of 1930.
       ``(D) A determination by the Secretary that a significant 
     number of fishermen in a community have been negatively 
     impacted by trade.
       ``(2) Notification.--The Secretary of Labor, immediately 
     upon making a determination that a group of workers is 
     eligible for trade adjustment assistance under section 223, 
     (or the Secretary of Agriculture, immediately upon making a 
     determination that a group of agricultural commodity 
     producers is eligible for adjustment assistance under section 
     293, as the case may be) shall notify the Secretary of 
     Commerce of the determination.
       ``(d) Notification to Eligible Communities.--Immediately 
     upon certification by the Secretary of Commerce that a 
     community is eligible for assistance under subsection (b), 
     the Secretary shall notify the community--
       ``(1) of the determination under subsection (b);
       ``(2) of the provisions of this chapter;
       ``(3) how to access the clearinghouse established by the 
     Department of Commerce regarding available economic 
     assistance;
       ``(4) how to obtain technical assistance provided under 
     section 272(c)(3); and
       ``(5) how to obtain grants, tax credits, low income loans, 
     and other appropriate economic assistance.

     ``SEC. 274. STRATEGIC PLANS.

       ``(a) In General.--An eligible community may develop a 
     strategic plan for community economic adjustment and 
     diversification and shall be eligible for assistance as 
     provided for under section 275.
       ``(b) Requirements for Strategic Plan.--A strategic plan 
     shall contain, at a minimum, the following:
       ``(1) A description and justification of the capacity for 
     economic adjustment, including the method of financing to be 
     used.
       ``(2) A description of the commitment of the community to 
     the strategic plan over the long term and the participation 
     and input of groups affected by economic dislocation.
       ``(3) A description of the projects to be undertaken by the 
     eligible community.
       ``(4) A description of how the plan and the projects to be 
     undertaken by the eligible community will lead to job 
     creation and job retention in the community.
       ``(5) A description of how the plan will achieve economic 
     adjustment and diversification.
       ``(6) A description of how the plan and the projects will 
     contribute to establishing or maintaining a level of public 
     services necessary to attract and retain economic investment.
       ``(7) A description and justification for the cost and 
     timing of proposed basic and advanced infrastructure 
     improvements in the eligible community.
       ``(8) A description of how the plan will address the 
     occupational and workforce conditions in the eligible 
     community.
       ``(9) A description of the educational programs available 
     for workforce training and future employment needs.
       ``(10) A description of how the plan will adapt to changing 
     markets and business cycles.
       ``(11) A description and justification for the cost and 
     timing of the total funds required by the community for 
     economic assistance.
       ``(12) A graduation strategy through which the eligible 
     community demonstrates that the community will terminate the 
     need for Federal assistance.
       ``(c) Grants To Develop Strategic Plans.--The Secretary, 
     upon receipt of an application from an eligible community, 
     may award a grant to that community to be used to develop and 
     implement the strategic plan.
       ``(d) Submission of Plan.--A strategic plan developed under 
     subsection (a) shall be submitted to the Secretary for 
     evaluation and approval.

     ``SEC. 275. GRANTS FOR ECONOMIC DEVELOPMENT.

       ``(a) In General.--The Secretary, upon approval of a 
     strategic plan from an eligible community, may award a grant 
     to that community to carry out any project or program that is 
     certified by the Secretary to be included in the strategic 
     plan approved under section 274(d), or consistent with that 
     plan.
       ``(b) Additional Grants.--Subject to paragraph (2), in 
     order to assist eligible communities to obtain funds under 
     Federal grant programs, other than the grants provided for in 
     section 274(c) or subsection (a), the Secretary may, on the 
     application of an eligible community, make a supplemental 
     grant to the community if--
       ``(1) the purpose of the grant program from which the grant 
     is made is to provide technical or other assistance for 
     planning, constructing, or equipping public works facilities 
     or to provide assistance for public service projects; and

[[Page S15074]]

       ``(2) the grant is 1 for which the community is eligible 
     except for the community's inability to meet the non-Federal 
     share requirements of the grant program.
       ``(c) Rural Community Preference.--The Secretary shall 
     develop guidelines to ensure that rural communities receive 
     preference in the allocation of resources.

     ``SEC. 276. GENERAL PROVISIONS.

       ``(a) Regulations.--The Secretary shall prescribe such 
     regulations as are necessary to carry out the provisions of 
     this chapter. Not later than 60 days before implementing any 
     regulation or guideline proposed by the Secretary with 
     respect to this chapter, the Secretary shall submit the 
     regulation or guideline to the Committee on Finance of the 
     Senate and the Committee on Ways and Means of the House of 
     Representatives for approval.
       ``(b) Supplement Not Supplant.--Funds appropriated under 
     this chapter shall be used to supplement and not supplant 
     other Federal, State, and local public funds expended to 
     provide economic development assistance for communities.
       ``(c) Authorization of Appropriations.--There is authorized 
     to be appropriated to the Secretary to carry out this chapter 
     amounts as follows:
       ``(1) For fiscal year 2005, $350,000,000.
       ``(2) For each of fiscal years 2006 through 2015, the 
     amount authorized to be appropriated by this subsection for 
     the preceding fiscal year increased by a percentage equal to 
     the percentage by which--
       ``(A) the Consumer Price Index (all items, United States 
     city average) for the 12-month period ending on the August 31 
     of such preceding fiscal year, exceeds
       ``(B) such Consumer Price Index for the 12-month period 
     preceding the 12-month period described in subparagraph (A). 
     Amounts appropriated pursuant to this subsection shall remain 
     available until expended.''.
       (b)  Conforming Amendments.--
       (1) Termination.--Section 285(b) of the Trade Act of 1974 
     (19 U.S.C. 2271 note) is amended by adding at the end the 
     following new paragraph:
       ``(3) Assistance for communities.--Technical assistance and 
     other payments may not be provided under chapter 4 after 
     September 30, 2015.''.
       (2) Table of contents.--The table of contents for title II 
     of the Trade Act of 1974 is amended by striking the items 
     relating to chapter 4 of title II and inserting after the 
     items relating to chapter 3 the following new items:

        ``Chapter 4--Trade Adjustment Assistance for Communities

``Sec. 271. Definitions.
``Sec. 272. Community Trade Adjustment Assistance Program.
``Sec. 273. Certification and notification.
``Sec. 274. Strategic plans.
``Sec. 275. Grants for economic development.
``Sec. 276. General provisions.''.

       (c) Judicial Review.--Section 284(a) of the Trade Act of 
     1974 (19 U.S.C. 2395(a)) is amended by striking ``section 
     271'' and inserting ``section 273''.
       (d) Effective Date.--The provisions of this section shall 
     take effect on October 1, 2004.

     SEC. 103. OFFICE OF TRADE ADJUSTMENT ASSISTANCE.

       (a) In General.--Chapter 3 of title II of the Trade Act of 
     1974 (19 U.S.C. 2341 et seq.) is amended by inserting after 
     section 255 the following new section:

     ``SEC. 255A. OFFICE OF TRADE ADJUSTMENT ASSISTANCE.

       ``(a) Establishment.--Not later than 90 days after the date 
     of enactment of the Enhance Domestic Manufacturing and Worker 
     Assistance Act of 2003, there shall be established in the 
     International Trade Administration of the Department of 
     Commerce an Office of Trade Adjustment Assistance.
       ``(b) Personnel.--The Office shall be headed by a Director, 
     and shall have such staff as may be necessary to carry out 
     the responsibilities of the Secretary of Commerce described 
     in this chapter.
       ``(c) Functions.--The Office shall assist the Secretary of 
     Commerce in carrying out the Secretary's responsibilities 
     under this chapter.''.
       (b) Conforming Amendment.--The table of contents for the 
     Trade Act of 1974 is amended by inserting after the item 
     relating to section 255, the following new item:

``Sec. 255A. Office of Trade Adjustment Assistance.''.

TITLE II--REAUTHORIZATION OF CERTAIN DEPARTMENT OF COMMERCE PARTNERSHIP 
                                PROGRAMS

     SEC. 201. MANUFACTURING EXTENSION PARTNERSHIP PROGRAM.

       (a) In General.--There is authorized to be appropriated for 
     the National Institute of Standards and Technology for the 
     Manufacturing Extension Partnership Program amounts as 
     follows:
       (1) For fiscal year 2005, $212,000,000.
       (2) For fiscal year 2006, $272,000,000.
       (3) For fiscal year 2007, $332,000,000.
       (4) For fiscal year 2008, $392,000,000.
       (5) For fiscal year 2009, $452,000,000.
       (6) For fiscal year 2010, $512,000,000.
       (7) For fiscal year 2011, $572,000,000.
       (8) For fiscal year 2012, $632,000,000.
       (9) For fiscal year 2013, $692,000,000.
       (10) For fiscal year 2014, $752,000,000.
       (11) For fiscal year 2015, $812,000,000.
       (b) Manufacturing Extension Partnership Program Defined.--
     In this section, the term ``Manufacturing Extension 
     Partnership Program'' means the program of Manufacturing 
     Extension Partnership carried out by the National Institute 
     of Standards and Technology under section 26 of the National 
     Institute of Standards and Technology Act (15 U.S.C. 278l), 
     as provided in part 292 of title 15, Code of Federal 
     Regulations.

     SEC. 202. ADVANCED TECHNOLOGY PROGRAM.

       There are authorized to be appropriated for the National 
     Institute of Standards and Technology for carrying out the 
     Advanced Technology Program under section 28 of the National 
     Institute of Standards and Technology Act (15 U.S.C. 278n), 
     $400,000,000 for each of fiscal years 2004 through 2013.

                    TITLE III--SMALL BUSINESS OFFICE

     SEC. 301. ESTABLISHMENT OF OFFICE.

       (a) In General.--Chapter 4 of title I of the Trade Act of 
     1974 (19 U.S.C. 2171) is amended by adding after section 141, 
     the following new section:

     ``SEC. 141A. SMALL BUSINESS OFFICE.

       ``(a) Establishment.--Not later than 90 days after the date 
     of enactment of the Enhance Domestic Manufacturing and Worker 
     Assistance Act of 2003, there shall be established in the 
     Office of the United States Trade Representative an Office of 
     Small Business.
       ``(b) Personnel.--The Office shall be headed by a Director, 
     and shall have such staff as may be necessary to carry out 
     the functions and responsibilities described in this section.
       ``(c) Functions.--The Office shall--
       ``(1) assist the United States Trade Representative in 
     carrying out the Trade Representative's responsibilities 
     under this chapter; and
       ``(2) ensure that small business manufacturing issues are 
     taken into consideration in carrying out those 
     responsibilities.''.
       (b) Conforming Amendment.--The table of contents for the 
     Trade Act of 1974 is amended by inserting after the item 
     relating to section 141, the following new item:

``Sec. 141A. Office of Small Business.''.

                                S. 1885

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

     SECTION 1. SHORT TITLE.

       This Act may be cited as the ``Manufacturing Job Production 
     Act of 2003''.

     SEC. 2. TEMPORARY MANUFACTURING JOB CREATION TAX CREDIT.

       (a) In General.--Subpart F of part IV of subchapter A of 
     chapter 1 (relating to rules for computing work opportunity 
     credit) is amended by inserting after section 51A the 
     following new section:

     ``SEC. 51B. REFUND OF PAYROLL TAXES ATTRIBUTABLE TO NEW 
                   MANUFACTURING EMPLOYEES DURING 2004 AND 2005.

       ``(a) General Rule.--In the case of an employee's first 
     taxable year beginning in any applicable calendar year, the 
     amount of the work opportunity credit determined under 
     section 51 (without regard to this section) for the taxable 
     year shall be increased by the increased manufacturing wages 
     payroll tax rebate amount.
       ``(b) Applicable Calendar Year.--For purposes of this 
     section, the term `applicable calendar year' means 2004 and 
     2005.
       ``(c) Increased Manufacturing Wages Payroll Tax Rebate 
     Amount.--
       ``(1) In general.--For purposes of this section, the term 
     `increased manufacturing wages payroll tax rebate amount' 
     means an amount equal to the applicable percentage of the 
     excess (if any) of--
       ``(A) the qualified manufacturing wages paid or incurred by 
     the employer with respect to employment during the applicable 
     calendar year, over
       ``(B) the sum of--
       ``(i) the qualified manufacturing wages paid or incurred by 
     the employer with respect to employment during the previous 
     calendar year, plus
       ``(ii) an amount equal to the amount determined under 
     clause (i) multiplied by a percentage equal to the percentage 
     change in the contribution and benefit base under section 230 
     of the Social Security Act from the applicable calendar year 
     to the previous calendar year.
       ``(2) Applicable percentage.--For purposes of this 
     subsection, the term `applicable percentage' means--
       ``(A) for 2004, 50 percent, and
       ``(B) for 2005, 25 percent.
       ``(d) Other Definitions and Rules.--For purposes of this 
     section--
       ``(1) Qualified manufacturing wages.--
       ``(A) In general.--The term `qualified manufacturing wages' 
     means wages which are paid by the taxpayer and included under 
     section 263A in the cost of property produced by the 
     taxpayer.
       ``(B) Wages.--The term `wages' has the meaning given such 
     term by section 3121(a), except that in the case of any 
     employer subject to tax under chapter 22 with respect to any 
     employee, the such term includes compensation within the 
     meaning of section 3231(e).
       ``(C) United States.--For purposes of this paragraph, the 
     term `United States' includes the territories and possessions 
     of the United States.
       ``(2) Predecessors.--Any reference in this section to an 
     employer shall include a reference to a predecessor.
       ``(3) Other rules.--Rules similar to the rules of sections 
     51(k) and 52 shall apply.
       ``(e) Regulations.--The Secretary shall prescribe such 
     regulations as may be necessary to carry out this section, 
     including

[[Page S15075]]

     regulations for the application of this section in the case 
     of acquisitions and dispositions.''.
       (b) Conforming Amendment.--The table of sections for 
     subpart F of part IV of subchapter A of chapter 1 is amended 
     by inserting after the item relating to section 51A the 
     following new item:

``Sec. 51B. Refund of payroll taxes attributable to new manufacturing 
              employees during 2004 and 2005.''.

     SEC. 3. MODIFICATIONS OF EXCLUSIONS AND ROLLOVERS OF GAIN ON 
                   QUALIFIED SMALL BUSINESS STOCK.

       (a) Exclusion of Gain on Qualified Small Business Stock.--
       (1) Increase in exclusion percentage.--
       (A) In general.--Section 1202(a)(1) (relating to exclusion 
     for gain from certain small business stock) is amended by 
     striking ``50 percent'' and inserting ``75 percent''.
       (B) 100-percent exclusion for critical technology, small 
     manufacturing, and specialized small business investment 
     businesses.--Section 1202(a) is amended by adding at the end 
     the following new paragraph:
       ``(3) Critical technology, small manufacturing, and 
     specialized small business investment businesses.--
       ``(A) In general.--In the case of qualified small business 
     stock acquired after the date of the enactment of this 
     paragraph which is stock in--
       ``(i) a critical technology corporation,
       ``(ii) a manufacturing corporation, or
       ``(iii) a corporation which is a specialized small business 
     investment company (as defined in subsection (c)(2)(B)(ii)),
     paragraph (1) shall be applied by substituting `100 percent' 
     for `75 percent'.
       ``(B) Critical technology corporation.--The term `critical 
     technology corporation' means a corporation substantially all 
     of the active business activities of which during 
     substantially all of a taxpayer's holding period of stock in 
     the corporation are in connection with--
       ``(i) transportation or homeland security technologies,
       ``(ii) antiterrorism technologies,
       ``(iii) technologies enhancing security by improving 
     methods of personal identification (including biometrics),
       ``(iv) environmental technologies for pollution 
     minimization, remediation, or waste management,
       ``(v) national defense technologies, or
       ``(vi) energy efficiency or the development of non-fossil 
     based fuel source technologies.
       ``(C) Manufacturing corporation.--The term `manufacturing 
     corporation' means a corporation substantially all of the 
     active business activities of which during substantially all 
     of a taxpayer's holding period of stock in the corporation 
     are in connection with manufacturing (as determined under the 
     North American Industrial Classification System).''.
       (C) Empowerment zone conforming amendment.--Section 
     1202(a)(2)(A) is amended--
       (i) by striking ``60 percent'' and inserting ``100 
     percent'', and
       (ii) by striking ``50 percent'' and inserting ``75 
     percent''.
       (2) Decrease in holding period.--
       (A) In general.--Section 1202(a)(1) is amended by striking 
     ``5 years'' and inserting ``4 years''.
       (B) Conforming amendment.--Section 1202(j)(1)(A) is amended 
     by striking ``5 years'' and inserting ``4 years''.
       (3) Exclusion available to corporations.--
       (A) In general.--Subsection (a) of section 1202 (relating 
     to partial exclusion for gains from certain small business 
     stock) is amended by striking ``other than a corporation''.
       (B) Technical amendment.--Subsection (c) of section 1202 is 
     amended by adding at the end the following new paragraph:
       ``(4) Stock held among members of controlled group not 
     eligible.--Stock of a member of a parent-subsidiary 
     controlled group (as defined in subsection (d)(3)) shall not 
     be treated as qualified small business stock while held by 
     another member of such group.''.
       (4) Stock of larger businesses eligible for exclusion.--
       (A) In general.--Paragraph (1) of section 1202(d) (defining 
     qualified small business) is amended by striking 
     ``$50,000,000'' each place it appears and inserting 
     ``$100,000,000''.
       (B) Inflation adjustment.--Section 1202(d) (defining 
     qualified small business) is amended by adding at the end the 
     following:
       ``(5) Inflation adjustment of asset limitation.--In the 
     case of stock issued in any calendar year after 2004, the 
     $100,000,000 amount contained in paragraph (1) shall be 
     increased by an amount equal to--
       ``(A) such dollar amount, multiplied by
       ``(B) the cost-of-living adjustment determined under 
     section 1(f)(3) for the calendar year, determined by 
     substituting `calendar year 2003' for `calendar year 1992' in 
     subparagraph (B) thereof.

     If any amount as adjusted under the preceding sentence is not 
     a multiple of $10,000, such amount shall be rounded to the 
     nearest multiple of $10,000.''.
       (b) Increase in Period To Purchase Replacement Stock and 
     Qualify for Rollover.--
       (1) In general.--Section 1045(a)(2) (relating to 
     nonrecognition of gain) is amended by striking ``60-day'' and 
     inserting ``180-day''.
       (2) Conforming amendment.--Section 1045(b)(2) is amended by 
     striking ``60-day'' and inserting ``180-day''.
       (c) Effective Dates.--
       (1) Exclusion.--The amendments made by subsection (a) shall 
     apply to stock issued after the date of the enactment of this 
     Act.
       (2) Rollover.--The amendment made by subsection (b) shall 
     apply to sales after the date of the enactment of this Act.

     SEC. 4. DEFERRED PAYMENT OF TAX BY CERTAIN SMALL BUSINESSES.

       (a) In General.--Subchapter B of chapter 62 of the Internal 
     Revenue Code of 1986 (relating to extensions of time for 
     payment of tax) is amended by adding at the end the following 
     new section:

     ``SEC. 6168. EXTENSION OF TIME FOR PAYMENT OF TAX FOR CERTAIN 
                   SMALL BUSINESSES.

       ``(a) In General.--An eligible small business may elect to 
     pay the tax imposed by chapter 1 in 4 equal installments (6 
     equal installments in the case of a qualified manufacturer).
       ``(b) Limitation.--The maximum amount of tax which may be 
     paid in installments under this section for any taxable year 
     shall not exceed whichever of the following is the least:
       ``(1) The tax imposed by chapter 1 for the taxable year.
       ``(2) The amount contributed by the taxpayer into a BRIDGE 
     Account during such year.
       ``(3) The excess of--
       ``(A) $250,000 ($400,000 in the case of a qualified 
     manufacturer), over
       ``(B) the aggregate amount of tax for which an election 
     under this section was made by the taxpayer (or any 
     predecessor) for all prior taxable years.
       ``(c) Definitions.--For proposes of this section--
       ``(1) Eligible small business.--
       ``(A) In general.--The term `eligible small business' 
     means, with respect to any taxable year, any person if--
       ``(i) such person meets the active business requirements of 
     section 1202(e) throughout such taxable year,
       ``(ii) the taxpayer has gross receipts of $10,000,000 or 
     less for the taxable year,
       ``(iii) the gross receipts of the taxpayer for such taxable 
     year are at least 10 percent greater than the average annual 
     gross receipts of the taxpayer (or any predecessor) for the 2 
     prior taxable years, and
       ``(iv) the taxpayer uses an accrual method of accounting.
       ``(B) Certain rules to apply.--Rules similar to the rules 
     of paragraphs (2) and (3) of section 448(c) shall apply for 
     purposes of this subsection.
       ``(2) Qualified manufacturer.--The term `qualified 
     manufacturer' means an eligible small business substantially 
     all of the business activities of which are in connection 
     with manufacturing (as determined under the North American 
     Industrial Classification System).
       ``(d) Date for Payment of Installments; Time for Payment of 
     Interest.--
       ``(1) Date for payment of installments.--
       ``(A) In general.--If an election is made under this 
     section for any taxable year, the first installment shall be 
     paid on or before the due date for such installment and each 
     succeeding installment shall be paid on or before the date 
     which is 1 year after the date prescribed by this paragraph 
     for payment of the preceding installment.
       ``(B) Due date for first installment.--The due date for the 
     first installment for a taxable year shall be whichever of 
     the following is the earliest:
       ``(i) The date selected by the taxpayer.
       ``(ii) The date which is 2 years after the date prescribed 
     by section 6151(a) for payment of the tax for such taxable 
     year.
       ``(2) Time for payment of interest.--If the time for 
     payment of any amount of tax has been extended under this 
     section--
       ``(A) Interest for period before due date of first 
     installment.--Interest payable under section 6601 on any 
     unpaid portion of such amount attributable to the period 
     before the due date for the first installment shall be paid 
     annually.
       ``(B) Interest during installment period.--Interest payable 
     under section 6601 on any unpaid portion of such amount 
     attributable to any period after such period shall be paid at 
     the same time as, and as a part of, each installment payment 
     of the tax.
       ``(C) Interest in the case of certain deficiencies.--In the 
     case of a deficiency to which subsection (e)(3) applies for a 
     taxable year which is assessed after the due date for the 
     first installment for such year, interest attributable to the 
     period before such due date, and interest assigned under 
     subparagraph (B) to any installment the date for payment of 
     which has arrived on or before the date of the assessment of 
     the deficiency, shall be paid upon notice and demand from the 
     Secretary.
       ``(e) Special Rules.--
       ``(1) Application of limitation to partners and s 
     corporation shareholders.--
       ``(A) In general.--In applying this section to a 
     partnership which is an eligible small business--
       ``(i) the election under subsection (a) shall be made by 
     the partnership,
       ``(ii) the amount referred to in subsection (b)(1) shall be 
     the sum of each partner's tax which is attributable to items 
     of the partnership and assuming the highest marginal rate 
     under section 1, and
       ``(iii) the partnership shall be treated as the taxpayer 
     referred to in paragraphs (2) and (3) of subsection (b).

[[Page S15076]]

       ``(B) Overall limitation also applied at partner level.--In 
     the case of a partner in a partnership, the limitation under 
     subsection (b)(3) shall be applied at the partnership and 
     partner levels.
       ``(C) Similar rules for s corporations.--Rules similar to 
     the rules of subparagraphs (A) and (B) shall apply to 
     shareholders in an S corporation.
       ``(2) Acceleration of payment in certain cases.--
       ``(A) In general.--If--
       ``(i) the taxpayer ceases to meet the requirement of 
     subsection (c)(1)(A)(i), or
       ``(ii) there is an ownership change with respect to the 
     taxpayer,

     then the extension of time for payment of tax provided in 
     subsection (a) shall cease to apply, and the unpaid portion 
     of the tax payable in installments shall be paid on or before 
     the due date for filing the return of tax imposed by chapter 
     1 for the first taxable year following such cessation.
       ``(B) Ownership change.--For purposes of subparagraph, in 
     the case of a corporation, the term `ownership change' has 
     the meaning given to such term by section 382. Rules similar 
     to the rules applicable under the preceding sentence shall 
     apply to a partnership.
       ``(3) Proration of deficiency to installments.--Rules 
     similar to the rules of section 6166(e) shall apply for 
     purposes of this section.
       ``(f) BRIDGE Account.--For purposes of this section--
       ``(1) In general.--The term `BRIDGE Account' means a trust 
     created or organized in the United States for the exclusive 
     benefit of an eligible small business, but only if the 
     written governing instrument creating the trust meets the 
     following requirements:
       ``(A) No contribution will be accepted for any taxable year 
     in excess of the amount allowed as a deferral under 
     subsection (b) for such year.
       ``(B) The trustee is a bank (as defined in section 408(n)) 
     or another person who demonstrates to the satisfaction of the 
     Secretary that the manner in which such person will 
     administer the trust will be consistent with the requirements 
     of this section.
       ``(C) The assets of the trust consist entirely of cash or 
     of obligations which have adequate stated interest (as 
     defined in section 1274(c)(2)) and which pay such interest 
     not less often than annually.
       ``(D) The assets of the trust will not be commingled with 
     other property except in a common trust fund or common 
     investment fund.
       ``(E) Amounts in the trust may be used only--
       ``(i) as security for a loan to the business or for 
     repayment of such loan, or
       ``(ii) to pay the installments under this section.
       ``(2) Account taxed as grantor trust.--The grantor of a 
     BRIDGE Account shall be treated for purposes of this title as 
     the owner of such Account and shall be subject to tax thereon 
     in accordance with subpart E of part I of subchapter J of 
     this chapter (relating to grantors and others treated as 
     substantial owners).
       ``(3) Time when payments deemed made.--For purposes of this 
     section, a taxpayer shall be deemed to have made a payment to 
     a BRIDGE Account on the last day of a taxable year if such 
     payment is made on account of such taxable year and is made 
     within 3\1/2\ months after the close of such taxable year.
       ``(g) Reports.--The Secretary may require such reporting as 
     the Secretary determines to be appropriate to carry out this 
     section.
       ``(h) Application of Section.--This section shall apply to 
     taxes imposed for taxable years beginning after December 31, 
     2003, and before January 1, 2008.''.
       (b) Priority of Lender.--Subsection (b) of section 6323 of 
     the Internal Revenue Code of 1986 (relating to protection for 
     certain interests even though notice filed) is amended by 
     adding at the end the following new paragraph:
       ``(11) Loans secured by bridge accounts.--With respect to a 
     BRIDGE account (as defined in section 6168(f)) with any bank 
     (as defined in section 408(n)), to the extent of any loan 
     made by such bank without actual notice or knowledge of the 
     existence of such lien, as against such bank, if such loan is 
     secured by such account.''.
       (c) Clerical Amendment.--The table of sections for 
     subchapter B of chapter 62 of the Internal Revenue Code of 
     1986 is amended by adding at the end the following new item:

``Sec.  6168. Extension of time for payment of tax for certain small 
              businesses.''.

       (d) Effective Date.--The amendments made by this section 
     shall apply to taxable years beginning after December 31, 
     2003.
       (e) Study by General Accounting Office.--
       (1) Study.--In consultation with the Secretary of the 
     Treasury, the Comptroller General of the United States shall 
     undertake a study to evaluate the applicability (including 
     administrative aspects) and impact of the amendments made by 
     section 4 of the Manufacturing Job Production Act of 2003, 
     including how it affects the capital funding needs of 
     businesses under the Act and number of businesses benefiting.
       (2) Report.--Not later than March 31, 2007, the Comptroller 
     General shall transmit to the Committee on Ways and Means of 
     the House of Representatives and the Committee on Finance of 
     the Senate a written report presenting the results of the 
     study conducted pursuant to this subsection, together with 
     such recommendations for legislative or administrative 
     changes as the Comptroller General determines are 
     appropriate.

     SEC. 5. PERMANENT EXTENSION OF INCREASED EXPENSING FOR SMALL 
                   BUSINESSES.

       (a) In General.--Paragraph (1) of section 179(b) of the 
     Internal Revenue Code of 1986 (relating to dollar limitation) 
     is amended by striking ``$25,000 ($100,000 in the case of 
     taxable years beginning after 2002 and before 2006)'' and 
     inserting ``$100,000''.
       (b) Increase in Qualifying Investment at Which Phaseout 
     Begins.--Paragraph (2) of section 179(b) of the Internal 
     Revenue Code of 1986 (relating to reduction in limitation) is 
     amended by striking ``$200,000 ($400,000 in the case of 
     taxable years beginning after 2002 and before 2006)'' and 
     inserting ``$400,000''.
       (c) Off-the-Shelf Computer Software.--Paragraph (1) of 
     section 179(d) of the Internal Revenue Code of 1986 (defining 
     section 179 property) is amended by striking ``, and which is 
     placed in service in a taxable year beginning after 2002 and 
     before 2006''.
       (d) Inflation Adjustment.--Subparagraph (A) of section 
     179(b)(5) of the Internal Revenue Code of 1986 (relating to 
     inflation adjustments) is amended by striking ``and before 
     2006''.
       (e) Revocation of Election.--Paragraph (2) of section 
     179(c) of the Internal Revenue Code of 1986 is amended by 
     striking the last sentence.
       (f) Effective Date.--The amendments made by this section 
     shall apply to taxable years beginning after December 31, 
     2003.

                                S. 1886

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

     SECTION 1. SHORT TITLE; TABLE OF CONTENTS.

       (a) Short Title.--This Act may be cited as the 
     ``Manufacturing Assistance, Development, and Education in 
     America Act'' or the ``MADE in America Act''.
       (b) Table of Contents.--The table of contents for this Act 
     is as follows:

Sec. 1. Short title; table of contents.
Sec. 2. Definition of small manufacturer.

  TITLE I--NATIONAL OFFICE FOR THE DEVELOPMENT OF SMALL MANUFACTURERS

Sec. 101. Establishment of office.

           TITLE II--INVESTING IN THE FUTURE OF MANUFACTURING

Sec. 201. Increased access to capital.
Sec. 202. Loans and investments in small manufacturers.

          TITLE III--EXPORT ASSISTANCE FOR SMALL MANUFACTURERS

Sec. 301. Small Business Foreign Patent Protection Grant Pilot Program.

     SEC. 2. DEFINITION OF SMALL MANUFACTURER.

       (a) Small Business Act.--Section 3(j) of the Small Business 
     Act (15 U.S.C. 632(j)) is amended by striking ``For the 
     purposes of section 7(b)(2) of this Act, the term'' and 
     inserting ``As used in this Act--
       ``(1) the term `small manufacturer' means a small business 
     concern (as defined in subsection (a))--
       ``(A) whose primary business is classified in sector 31, 
     32, or 33 of the North American Industrial Classification 
     System; and
       ``(B) whose production facilities are all located in the 
     United States; and
       ``(2) the term''.
       (b) Small Business Investment Act of 1958.--Section 103 of 
     the Small Business Investment Act of 1958 (15 U.S.C. 662) is 
     amended--
       (1) in paragraph (16), by striking ``and'' at the end;
       (2) in paragraph (17), by striking the period at the end 
     and inserting ``; and''; and
       (3) by adding at the end the following:
       ``(18) the term `small manufacturer' means a small business 
     concern (as defined in section 3(a) of the Small Business 
     Act)--
       ``(A) whose primary business is classified in sector 31, 
     32, or 33 of the North American Industrial Classification 
     System; and
       ``(B) whose production facilities are all located in the 
     United States.''.

  TITLE I--NATIONAL OFFICE FOR THE DEVELOPMENT OF SMALL MANUFACTURERS

     SEC. 101. ESTABLISHMENT OF OFFICE.

       (a) In General.--The Small Business Act (15 U.S.C. 631 et 
     seq.) is amended--
       (1) by redesignating section 36 as section 37; and
       (2) by inserting after section 35 the following:

     ``SEC. 36. NATIONAL OFFICE FOR DEVELOPMENT OF SMALL 
                   MANUFACTURERS.

       ``(a) Establishment.--There is established in the 
     Administration the National Office for the Development of 
     Small Manufacturers (referred to in this section as the 
     `Office') to cultivate and develop small manufacturers 
     through a variety of means.
       ``(b) Associate Administrator for Small Manufacturing.--
       ``(1) Appointment.--The Office shall be administered by the 
     Associate Administrator for Small Manufacturing (referred to 
     in this section as the `Associate Administrator'), who shall 
     be appointed under section 4(b)(1).
       ``(2) Responsibilities.--In administering the Office, the 
     Associate Administrator, who shall be an appointee in the 
     Senior Executive Service, shall--
       ``(A) oversee and coordinate the formulation, execution, 
     and promotion of policies and programs of the Administration 
     that provide assistance to small manufacturers,

[[Page S15077]]

     including the creation of the Manufacturing Corps;
       ``(B) direct Federal agencies and departments to provide 
     information regarding their manufacturing resources and 
     programs, and to take appropriate action to enhance 
     assistance to small manufacturers;
       ``(C) coordinate the activities, and delivery of such 
     activities, of Federal agencies and departments relating to 
     manufacturing;
       ``(D) coordinate the activities of Federal agencies with 
     manufacturing activities of the States; and
       ``(E) consult with and report to the Administrator 
     regarding the fulfillment of responsibilities under this 
     subsection.
       ``(c) Manufacturing Corps.--
       ``(1) Establishment.--The Administrator shall establish a 
     program within the Office to be known as the Manufacturing 
     Corps to focus on the education and training of the existing 
     and potential workforce of small manufacturers.
       ``(2) Administration.--The Manufacturing Corps shall be 
     administered by the Associate Administrator.
       ``(3) Responsibilities.--The Manufacturing Corps shall 
     address the pressing need for more skilled workers by 
     promoting vocational, technical, and academic education 
     relating to the manufacturing sector.
       ``(4) Curriculum development.--
       ``(A) Outreach.--The Associate Administrator shall 
     regularly seek input from small manufacturers regarding the 
     human capital needs of the manufacturing industry.
       ``(B) Cooperation.--The input received under subparagraph 
     (A) shall be used to develop, and annually update, a detailed 
     manufacturing training curriculum for each State through the 
     cooperative effort of small manufacturers and educational 
     institutions.
       ``(d) Manufacturing Training Block Grants.--
       ``(1) Grants authorized.--The Administrator, in 
     consultation with the Associate Administrator, shall award 
     block grants to States, which shall allocate grant funds to 
     individuals and eligible entities to develop and implement 
     manufacturing training programs.
       ``(2) Funding formula.--
       ``(A) In general.--Subject to subparagraph (C), the amount 
     of a formula grant received by a State under this subsection 
     shall be equal to an amount determined in accordance with the 
     following formula:
       ``(i) The annual amount made available under subsection (i) 
     for the Manufacturer Corps Program 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 clause (i) 
     for any State is less than the minimum funding level under 
     subparagraph (C), the Administration shall determine the 
     aggregate amount necessary to achieve that minimum funding 
     level for each such State.
       ``(iii) The aggregate amount calculated under clause (ii) 
     shall be deducted from the amount calculated under clause (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 clause (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.
       ``(B) Grant determination.--The amount of a grant that a 
     State is eligible to apply for under this subsection shall be 
     the amount determined under subparagraph (A), subject to any 
     modifications required under subparagraph (C), 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 subparagraph (D). 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 paragraph (7).
       ``(C) Minimum funding level.--Each State shall receive a 
     block grant under this subsection in an amount not less 
     than--
       ``(i) $200,000 for any fiscal year in which the total 
     amount appropriated for grants under this subsection is not 
     more than $25,000,000;
       ``(ii) $300,000 for any fiscal year in which the total 
     amount appropriated for grants under this subsection is more 
     than $25,000,000, but not more than $50,000,000;
       ``(iii) $400,000 for any fiscal year in which the total 
     amount appropriated for grants under this subsection is more 
     than $50,000,000, but not more than $75,000,000; and
       ``(iv) $500,000 for any fiscal year in which the total 
     amount appropriated for grants under this subsection is more 
     than $75,000,000.
       ``(D) Distributions.--Subject to subparagraph (C), 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 supplemental grants to any 
     State, as the Administration determines, in its discretion, 
     to be appropriate.
       ``(3) Eligible entities.--Secondary, vocational, and 
     postsecondary schools that receive public funding, 
     manufacturing extension partnerships, small business 
     development centers, women's business centers, and similar 
     nonprofit organizations shall be eligible to receive grant 
     funds from States under this subsection.
       ``(4) Use of funds.--
       ``(A) In general.--Grants awarded under this section may 
     only be used to develop and implement vocational, technical, 
     or academic training programs to educate and enhance the 
     skills of--
       ``(i) individuals working in the field of manufacturing; 
     and
       ``(ii) students who are interested in working in the field 
     of manufacturing.
       ``(B) Secondary schools.--Secondary schools may use funds 
     received under this subsection to develop and conduct 
     vocational and technology training to high school students to 
     prepare students who are not planning to attend college 
     immediately after graduation for employment in the field of 
     manufacturing. Schools are encouraged to partner with small 
     manufacturers to address their skilled worker needs and to 
     provide employment opportunities for students after 
     graduation.
       ``(C) Continuing education.--Manufacturing extension 
     partnerships, small business development centers, women's 
     business centers, and similar nonprofit organizations may use 
     funds received under this subsection to assist existing 
     manufacturing workers to improve their skills and advance 
     their technical abilities.
       ``(5) Student loan repayment program.--
       ``(A) In general.--States may use grant funds received 
     under this subsection to encourage recent college graduates 
     to work for a small manufacturer by repaying a portion of 
     their student loans during the period of such employment.
       ``(B) Maximum amounts.--A State may make payments of not 
     more than $300 per month toward the student loan principal 
     and interest of any college graduate who has committed to 
     work for a small manufacturer for a 4-year period beginning 
     not sooner than the date on which the graduate submits an 
     application under paragraph (6)(B). Aggregate payments to any 
     individual under this paragraph may not exceed $25,000.
       ``(C) Renewal.--After the initial 4-year term established 
     under subparagraph (B) has been completed, the State may 
     annually renew its commitment under subparagraph (B) for 
     successive 1-year periods if the college graduate commits to 
     continue working for the small manufacturer.
       ``(D) Maximum compensation.--Individuals whose gross annual 
     compensation (including bonuses) from the small manufacturer 
     is greater than $60,000 are ineligible to participate in the 
     student loan repayment program authorized by this paragraph.
       ``(6) Application.--
       ``(A) Institutional applicants.--Any eligible entity 
     desiring funding under this subsection shall submit a 
     proposal to the appropriate representative of the State in 
     which it is located.
       ``(B) Individual applicants.--Any college graduate desiring 
     to participate in the student loan repayment program 
     authorized under paragraph (5) shall submit an application to 
     the appropriate representative of the State in which the 
     graduate resides in such form as such representative may 
     reasonably require.
       ``(C) Criteria.--States may determine which applicants 
     receive funding under this subsection based upon specific 
     needs and available resources.
       ``(7) Matching requirement.--
       ``(A) Years 1 and 2.--During each of the first and second 
     years of the grant program established under this subsection, 
     each State receiving a block grant under this subsection 
     shall provide $1 in non-Federal funding for each $3 received 
     in Federal funding under this section.
       ``(B) Years 3 and 4.--During each of the third and fourth 
     years of the grant program established under this subsection, 
     each State receiving a block grant under this subsection 
     shall provide $1 in non-Federal funding for each $2 received 
     in Federal funding under this section.
       ``(C) Years 5 through 10.--During each of the fifth through 
     tenth years of the grant program established under this 
     subsection, each State receiving a block grant under this 
     subsection shall provide $1 in non-Federal funding for each 
     $1 received in Federal funding under this section.
       ``(8) State reporting requirement.--Each State receiving a 
     grant under this subsection shall provide sufficient 
     information to the Administration about the distribution of 
     grant funds to complete the report required under subsection 
     (e).
       ``(9) Defined term.--As used in this subsection, the term 
     `State' has the meaning given the term in section 34(a).
       ``(e) BusinessLINC Manufacturing.--
       ``(1) In general.--In accordance with this subsection, the 
     Administrator may make grants to and enter into cooperative 
     agreements with any coalition of private entities, public 
     entities, or any combination of private and public entities--
       ``(A) to expand business-to-business relationships between 
     large and small manufacturers; and
       ``(B) to provide large and small manufacturers, directly or 
     indirectly, with online information and a database of 
     companies that are interested in mentor-protege programs or 
     community-based, statewide, or local business development 
     programs.
       ``(2) Matching requirement.--Subject to subparagraph (B), 
     the Administrator may make a grant to a coalition under 
     paragraph (1) only if the coalition provides for activities 
     described in paragraph (1)(A) or (1)(B) an

[[Page S15078]]

     amount, either in kind or in cash, equal to the grant amount.
       ``(3) Authorization of appropriations.--There are 
     authorized to be appropriated to carry out this subsection 
     $2,000,000 for each of the fiscal years 2004 through 2008, 
     which shall remain available until expended.
       ``(f) Website for Small Manufacturers.--The Associate 
     Administrator shall establish a website that contains 
     information for small manufacturers regarding--
       ``(1) entrepreneurial development assistance;
       ``(2) access to capital;
       ``(3) specific outreach programs;
       ``(4) contracting opportunities; and
       ``(5) research and development projects.
       ``(g) Mentor-Protege Program.--The Associate Administrator 
     shall establish a mentor-protege program that pairs small 
     manufacturers with larger, more experienced manufacturers to 
     provide guidance regarding--
       ``(1) management practices;
       ``(2) domestic and foreign marketing;
       ``(3) efficiency improvements; and
       ``(4) product development.
       ``(h) Report.--
       ``(1) In general.--The Administrator, in consultation with 
     the Associate Administrator, shall submit an annual report on 
     the implementation of this section to the Committee on Small 
     Business and Entrepreneurship of the Senate and the Committee 
     on Small Business of the House of Representatives.
       ``(2) Contents.--Each report submitted under paragraph (1) 
     shall include, for the reporting period--
       ``(A) the number of persons assisted under this section, 
     categorized by type of assistance received;
       ``(B) the number of persons described under subparagraph 
     (A) who had previously received assistance under this 
     section;
       ``(C) the number of persons described in subparagraph (A) 
     who are working in the manufacturing sector;
       ``(D) the number and amount of grants awarded under this 
     section, categorized by type of recipient;
       ``(E) the number of small manufacturers receiving grant 
     funds under this section; and
       ``(F) the net increase in manufacturing jobs available at 
     the small manufacturers described in subparagraph (E);
       ``(i) Authorization of Appropriations.--There are 
     authorized to be appropriated $275,000,000 for each of the 
     fiscal years 2005 through 2014 to carry out this subsections 
     (c) and (d).''.
       (b) Conforming Amendments.--Section 4(b)(1) of the Small 
     Business Act (15 U.S.C. 633(b)(1)) is amended--
       (1) by striking ``five Associate Administrators'' and 
     inserting ``6 Associate Administrators''; and
       (2) by adding at the end the following: ``One of the 
     Associate Administrators shall be the Associate Administrator 
     for Small Manufacturing, who shall administer the National 
     Office for the Development of Small Manufacturers established 
     under section 36.''.

           TITLE II--INVESTING IN THE FUTURE OF MANUFACTURING

     SEC. 201. INCREASED ACCESS TO CAPITAL.

       (a) Working Capital Loans.--Section 7(a) of the Small 
     Business Act (15 U.S.C. 636(a)) is amended--
       (1) in paragraph (3)--
       (A) by inserting ``Total amount of loans.--'' before ``No 
     loan'';
       (B) by amending subparagraph (A) to read as follows:
       ``(A) if the total amount outstanding and committed (by 
     participation or otherwise) to the borrower under section 
     7(a) would exceed $1,000,000 (or if the gross loan amount 
     would exceed $2,000,000), except as provided in subparagraphs 
     (B) and (D) and paragraph (14), plus an amount not to exceed 
     the maximum amount of a development company financing under 
     title V of the Small Business Investment Act of 1958 (15 
     U.S.C. 695 et seq.), and the Administration shall report to 
     Congress in its annual budget request and performance plan on 
     the number of small business concerns that have financings 
     under this subsection and under title V of the Small Business 
     Investment Act of 1958, and the total amount and general 
     performance of such financings;'';
       (C) in subparagraph (B)--
       (i) by striking ``$1,250,000'' and inserting 
     ``$1,300,000''; and
       (ii) by striking ``and'' at the end;
       (D) in subparagraph (C), by striking the period at the end 
     and inserting ``; and''; and
       (E) by adding at the end the following:
       ``(D) to a small manufacturer if the total amount 
     outstanding and committed to the borrower from the business 
     loan and investment fund established by this Act would exceed 
     $2,000,000 (or if the gross loan amount would exceed 
     $4,000,000).''; and
       (2) in paragraph (14), by adding at the end the following:
       ``(D) The total amount of financings under this paragraph 
     that are outstanding and committed (by participation or 
     otherwise) to the borrower from the business loan and 
     investment fund established under this Act may not exceed 
     $1,300,000 and the gross loan amount under this paragraph may 
     not exceed $2,600,000.''.
       (b) Disaster Loans.--Section 7(b)(3) of the Small Business 
     Act (15 U.S.C. 636(b)) is amended by inserting after 
     subparagraph (F) the following:
       ``(G) Limitation on sales of loans.--The Administration may 
     not sell a loan under this subsection as part of an asset 
     sale.
       ``(H) Small manufacturers.--
       ``(i) Maximum loan amount.--Notwithstanding subparagraph 
     (E), the Administration may make a disaster loan to a small 
     manufacturer under this paragraph, either directly or in 
     cooperation with banks or other lending institutions through 
     agreements to participate on an immediate or deferred basis, 
     in an amount greater than $1,500,000, if the total amount 
     outstanding and committed to the borrower does not exceed 
     $5,000,000.
       ``(ii) Refinancing disaster loans.--Any loan made to a 
     small manufacturer under this subparagraph that was 
     outstanding on the date of the disaster may be refinanced by 
     a small manufacturer that is also eligible to receive a loan 
     under this subsection. The refinanced amount shall be 
     considered to be part of the new loan for purposes of this 
     subsection and shall be in addition to any other loan 
     eligibility for that small manufacturer under this Act and 
     the Small Business Investment Act of 1958. With respect to a 
     refinancing under this clause, payments of principal shall be 
     deferred, and interest shall not accrue during the 6-month 
     period following the date of refinancing.
       ``(iii) Refinancing business debt.--
       ``(I) In general.--Any business debt of a small 
     manufacturer that was outstanding on the date of the disaster 
     may be refinanced by the small manufacturer if it is also 
     eligible to receive a loan under this subsection. With 
     respect to a refinancing under this clause, payments of 
     principal shall be deferred, and interest shall not accrue 
     during the 6-month period following the date of refinancing.
       ``(II) Resumption of payments.--At the end of the 6-month 
     period described in subclause (I), the payment of periodic 
     installments of principal and interest shall be required with 
     respect to such loan, in the same manner and subject to the 
     same terms and conditions as would otherwise be applicable to 
     any other loan made under this subsection.
       ``(iv) Authority to increase or waive size standards and 
     size regulations.--
       ``(I) In general.--At the discretion of the Administrator, 
     the Administrator may increase or waive otherwise applicable 
     size standards or size regulations with respect to businesses 
     applying for disaster loans under this subparagraph.
       ``(II) Exemption from administrative procedures.--The 
     provisions of subchapter II of chapter 5, of title 5, United 
     States Code, shall not apply to any increase or waiver by the 
     Administrator under subclause (I).''.
       (c) Microloans.--Section 7(m) of the Small Business Act (15 
     U.S.C. 636(m)) is amended--
       (1) in paragraph (1)--
       (A) in subparagraph (A)--
       (i) in clause (iii), by striking ``and'' at the end;
       (ii) in clause (iv), by striking the period at the end and 
     inserting ``; and''; and
       (iii) by adding at the end the following:
       ``(v) to assist small manufacturers.''; and
       (B) in subparagraph (B)(iii), by inserting ``(or $50,000 if 
     the borrower is a small manufacturer)'' after ``$35,000''; 
     and
       (2) in paragraph (3)(E)--
       (A) by striking ``In no case shall an intermediary'' and 
     inserting ``An intermediary may not''; and
       (B) by inserting before the period at the end the 
     following: ``, unless the borrower is a small manufacturer. 
     An intermediary may not make a loan to a small manufacturer 
     under this section of more than $50,000, or have outstanding 
     or committed to any small manufacturer more than $50,000''.

     SEC. 202. LOANS AND INVESTMENTS IN SMALL MANUFACTURERS.

       (a) Manufacturing Loans.--
       (1) Job creation or retention standards.--Section 501 of 
     the Small Business Investment Act of 1958 (15 U.S.C. 695) is 
     amended--
       (A) in subsection (d)(2), by inserting ``increasing the 
     productive capacity of small manufacturers,'' after ``area''; 
     and
       (B) by striking the undesignated paragraph at the end and 
     inserting the following:
       ``(e) Job Creation or Retention.--A project being funded by 
     the debenture is deemed to satisfy the job creation or 
     retention requirement under subsection (d)(1) if the project 
     creates or retains--
       ``(1) 1 job opportunity for every $50,000 guaranteed by the 
     Administration; or
       ``(2) in the case of a manufacturing project, 1 job 
     opportunity for every $100,000 guaranteed by the 
     Administration.''.
       (2) Maximum amount.--Section 502(2) of the Small Business 
     Investment Act of 1958 (15 U.S.C. 696(2)) is amended to read 
     as follows:
       ``(2) Maximum amount.--Loans made by the Administration 
     under this section shall be limited to--
       ``(A) $1,000,000 for each small business concern if the 
     loan proceeds will not be directed toward a goal or project 
     described in subparagraph (B) or (C);
       ``(B) $1,300,000 for each small business concern if the 
     loan proceeds will be directed toward 1 or more of the public 
     policy goals described under section 501(d)(3); and
       ``(C) $4,000,000 for each small business concern if the 
     loan proceeds will be directed toward manufacturing 
     projects.''.
       (3) Rule of construction.--Section 502 of the Small 
     Business Investment Act of 1958 (15 U.S.C. 696) is amended by 
     adding at the end the following:
       ``(7) Rule of construction.--A loan under this section 
     shall not be construed to be limited by any loan guaranteed 
     by the Administration under subsection (a) or (b) of section

[[Page S15079]]

     7 of the Small Business Act (15 U.S.C. 636(a) and (b)).''.
       (b) Small Business Investment Companies.--Section 303(b)(4) 
     of the Small Business Investment Act of 1958 (15 U.S.C. 
     683(b)(4)) is amended--
       (1) in subparagraph (A), by striking ``(as determined by 
     the Administrator)'' and all that follows and inserting ``may 
     not exceed $115,000,000.''; and
       (2) by amending subparagraph (B) to read as follows:
       ``(B) Exceptions.--
       ``(i) Majority of financings in small manufacturers.--If 
     the licensee certifies in writing that not less than 50 
     percent of the aggregate dollar amount of its financings are 
     to small manufacturers--

       ``(I) the maximum amount of outstanding leverage issued to 
     any 1 company shall be $150,000,000; and
       ``(II) the maximum amount of outstanding leverage issued to 
     companies that are under common control shall be 
     $185,000,000.

       ``(ii) Companies under common control.--The Administrator 
     may, on a case-by-case basis--

       ``(I) approve an amount of leverage that exceeds the amount 
     described in clause (i) and subparagraph (A) for companies 
     under common control; and
       ``(II) impose such additional terms and conditions as the 
     Administrator determines to be appropriate to minimize the 
     risk of loss to the Administration in the event of 
     default.''.

       (c) New Market Venture Capital Program.--
       (1) Purposes.--Section 352 of the Small Business Investment 
     Act (15 U.S.C. 689a) is amended--
       (A) in paragraph (1), by inserting ``and small 
     manufacturers'' after ``enterprises''; and
       (B) in paragraph (2), by inserting ``and small 
     manufacturers'' after ``enterprises''.
       (2) Maximum guarantee for small manufacturers.--Section 
     355(d)(1) of the Small Business Investment Act (15 U.S.C. 
     689d(d)(1)) is amended--
       (A) by striking ``does not exceed 150 percent'' and 
     inserting ``does not exceed--
       ``(A) 150 percent''; and
       (B) by striking the period at the end and inserting ``; and
       ``(B) 200 percent of the private capital of the company, if 
     the New Markets Venture Capital company certifies in writing 
     that not less than 50 percent of its investments are in small 
     manufacturers.''.
       (d) Authorization of Additional Appropriations.--Section 
     368 of the Small Business Investment Act of 1958 (15 U.S.C. 
     689q) is amended--
       (1) by redesignating subsection (b) as subsection (c); and
       (2) by inserting after subsection (a) the following:
       ``(b) Authorization of Additional Appropriations.--In 
     addition to the authorizations under subsection (a), there 
     are authorized to be appropriated for each of fiscal years 
     2005 and 2006, to remain available until expended, the 
     following sums:
       ``(1) Such subsidy budget authority as may be necessary to 
     guarantee $75,000,000 of debentures under this part.
       ``(2) $15,000,000 to make grants under this part.''.

          TITLE III--EXPORT ASSISTANCE FOR SMALL MANUFACTURERS

     SEC. 301. SMALL BUSINESS FOREIGN PATENT PROTECTION GRANT 
                   PILOT PROGRAM.

       Section 9 of the Small Business Act (15 U.S.C. 638) is 
     amended by adding at the end the following:
       ``(x) Small Business Foreign Patent Protection Grant Pilot 
     Program.--
       ``(1) Grants authorized.--The Administrator shall make 
     grants from the Fund established under paragraph (5) for the 
     purpose of assisting small business concerns in seeking 
     foreign patent protection in accordance with this subsection.
       ``(2) Number and amount of grants.--
       ``(A) Maximum amount.--The amount of a grant made to any 
     small business concern under this subsection may not exceed 
     $25,000, and no awardee may receive more than 1 grant under 
     this subsection.
       ``(B) Reserved amounts.--
       ``(i) In general.--Not less than \1/2\ of all amounts 
     awarded under this section shall be reserved for recipients 
     of awards under the Small Business Innovation Research 
     Program or the Small Business Technology Transfer Program.
       ``(ii) Exception.--Any amount reserved for grants under 
     clause (i) for any fiscal year that has not been obligated by 
     July 1st of such fiscal year, may be used for grants under 
     this subsection to any small business concern.
       ``(3) Grant purposes.--Grant amounts awarded under this 
     subsection shall be used by grantees to underwrite costs 
     associated with initial foreign patent applications for 
     technologies or products developed by small business 
     concerns, and for which an application for United States 
     patent protection has already been filed.
       ``(4) Considerations.--In awarding grants under this 
     subsection, the Director of the Office of Technology shall 
     consider--
       ``(A) the size and financial need of the applicant;
       ``(B) the potential foreign market for the technology;
       ``(C) the timeframes for filing foreign patent 
     applications; and
       ``(D) such other factors as the Administrator deems 
     relevant.
       ``(5) Establishment of revolving fund.--There is 
     established in the Treasury of the United States a revolving 
     fund, which shall be--
       ``(A) known as the `Small Business Foreign Patent 
     Protection Grant Fund' (referred to in this subsection as the 
     `Fund');
       ``(B) administered by the Office of Technology of the 
     Administration, in consultation with the National Office for 
     Development of Small Manufacturers; and
       ``(C) used solely to fund grants under this subsection and 
     to pay the costs to the Administration of administering those 
     grants.
       ``(6) Royalty fees.--
       ``(A) In general.--Each recipient of a grant under this 
     subsection shall pay a fee to the Administration, to be 
     deposited into the Fund, based on the export sales receipts 
     or licensing fees, if any, from the product or technology 
     that is the subject of the foreign patent petition.
       ``(B) Annual installments based on receipts.--The fee 
     required under subparagraph (A)--
       ``(i) shall be paid to the Administration in annual 
     installments, based on the export sales receipts or licensing 
     fees described in subparagraph (A) that are collected by the 
     grant recipient in that calendar year;
       ``(ii) shall not be required to be paid in any calendar 
     year in which no export sales receipts or licensing fees 
     described in subparagraph (A) are collected by the grant 
     recipient; and
       ``(iii) shall not exceed, in total, the lesser of--

       ``(I) 5 percent of the total export sales receipts and 
     licensing fees referred to in subparagraph (A); or
       ``(II) 4 times the amount of the grant received.

       ``(7) Administrative provisions.--Not later than 180 days 
     after the date of enactment of this subsection, the 
     Administrator shall--
       ``(A) issue such regulations as are necessary to carry out 
     this subsection; and
       ``(B) establish appropriate application and other 
     administrative procedures, as the Administrator deems 
     necessary.
       ``(8) Report.--The Administrator shall, not later than 
     January 31, 2008, submit a report to Congress on the grants 
     authorized by this subsection, which report shall include, 
     categorized by year and total--
       ``(A) the number of grant recipients under this subsection 
     since the date of enactment of this subsection;
       ``(B) the number and amount of sales or licensing fees of 
     such grant recipients that have made foreign sales (or 
     granted licenses to make foreign sales) and a brief 
     description of each technology or product;
       ``(C) the number of technologies or products developed 
     under the Small Business Innovation Research Program or the 
     Small Business Technology Transfer Program, and the amounts 
     of such sales (or licenses);
       ``(D) the total amount of fees paid into the Fund by 
     recipients of grants under this subsection in accordance with 
     paragraph (6);
       ``(E) recommendations for any adjustment in the percentages 
     specified in paragraph (6)(B)(iii)(I) or the amount specified 
     in paragraph (6)(B)(iii)(II) necessary to reduce to zero the 
     cost to the Administration of making grants under this 
     subsection;
       ``(F) any recommendations regarding the grant amount; and
       ``(G) any recommendations of the Administrator regarding 
     improvements to the programs, whether authorization for 
     grants under this subsection should be extended, and any 
     necessary legislation related to such an extension.
       ``(9) Staffing.--The Administrator shall ensure that there 
     are sufficient staff in the Office of Technology, including 
     not fewer than 2 full-time employees, to carry out the grant 
     program established under this subsection.
       ``(10) Authorization of appropriations.--There are 
     authorized to be appropriated to the Fund, to remain 
     available until expended--
       ``(A) $2,500,000 for fiscal years 2005;
       ``(B) $5,000,000 for fiscal year 2006;
       ``(C) $7,500,000 for fiscal year 2007; and
       ``(D) $10,000,000 for each of fiscal years 2008 and 
     2009.''.
                                 ______