[Congressional Record (Bound Edition), Volume 145 (1999), Part 15]
[Extensions of Remarks]
[Pages 21168-21170]
[From the U.S. Government Publishing Office, www.gpo.gov]



  VETERANS ENTREPRENEURSHIP AND SMALL BUSINESS DEVELOPMENT ACT OF 1999

                                 ______
                                 

                          HON. JAMES M. TALENT

                              of missouri

                    in the house of representatives

                      Thursday, September 9, 1999

  Mr. TALENT. Mr. Speaker, over the years, the Nation has recognized 
the debt owed to citizens who serve in defense of our Constitution and 
the American ideals of free speech, personal liberty, and free 
enterprise. H.R. 1568 builds on the best examples of this public policy 
from our Nation's history. From the beginning of the Republic, when the 
Continental Congress provided land grants to Revolutionary War 
veterans, we have helped veterans with self-employment and self-
sufficiency. 150 years later, the 1944 Servicemen's Readjustment Act, 
or ``G.I. Bill of Rights of World War II'' provided loan guarantees for 
returning World War II, and later Korean War, veterans. In the ten 
years following, the Federal Government provided over 280,000 small 
business and farm loans to veterans to help include them in the post-
war boom and use their talents to propel that boom.
  Unfortunately, the Nation's efforts on behalf of veterans have 
diminished drastically in the intervening 45 years. Over the years, the 
interests of veterans, particularly the service-disabled, have fallen 
on infertile ground. While specifically included as a priority of the 
SBA at its creation, the Office of Veterans Affairs and the needs of 
veterans have been diminished systematically at the SBA. Elimination of 
the direct loan program for veterans in fiscal year 1995, at then 
Administrator Phil Lader's request, resulted in serious diminution of 
financial assistance for veterans. Total loan dollars dropped from $22 
million dollars in loans in 1993 to $10.8 million in 1998. Likewise, 
training and counseling for veterans dropped from 38,775 total 
counseling sessions for veterans in 1993 to 29,821 sessions in 1998.
  Such neglect, Mr. Speaker, would turn many people away from faith in 
government. However, as former British Prime Minister Margaret Thatcher 
might say, veterans are not for turning. In November 1998, the SBA 
Veterans' Affairs Task Force for Entrepreneurship filed its report. The 
Task Force examined all SBA programs, including business development, 
education and training, financial assistance, government contracting, 
and advocacy to determine ways to improve SBA's ability to assist 
veterans. The Task Force identified ``high priority'' recommendations. 
These included:
  Legislation to allow guaranteed loans to veterans with certified 
service-connected disabilities or who were POWs;
  A program of comprehensive outreach to assist disabled veterans, 
including business training and management assistance, employment and 
relocation counseling, and dissemination of information on veterans 
benefits and veterans entitlements as required by Title VII;
  A company designed to address veterans' issues regarding small 
business; and
  Regulations that include service-disabled veteran-owned businesses as 
a ``socially and economically disadvantaged business group'' to be 
solicited for all federal contracts and subcontracts in a documented 
outreach program.
  The Veterans Entrepreneurship and Small Business Development Act of 
1999 (H.R. 1568), implements the SBA Veterans' Affairs Task Force's 
``high priority'' recommendations.
  First, the Task Force recommended guaranteed loan opportunities. H.R. 
1568 makes veterans eligible for funds under the microloan, DELTA Loan 
and State Development Company programs. For example, H.R. 1568 makes 
veterans eligible for assistance under the SBA's microloan program 
which provides small loans, i.e., under $25,000, to people seeking 
initial financing for small business start-up or expansion. 
Furthermore, H.R. 1568 requires the Small Business Administration to 
establish a system for loan deferrals for small business owners called 
up for active duty. It also requires the SBA to make economic injury 
disaster loans available to self-employed individuals who are called to 
active duty for the National Guard and reserves. These loan 
opportunities enable veterans to access capital markets currently 
available to women, low-income, minority entrepreneurs, and other 
business owners possessing the capability to operate successful 
business concerns.
  Second, the Task Force identified an outreach program to assist 
disabled veterans in business training and management assistance, 
employment and relocation counseling, and dissemination of information 
on veterans benefits and entitlements as a priority. H.R. 1568 amends 
the Small Business Development Act to require the Secretary of 
Veterans' Affairs, the Administrator of the Small Business 
Administration and the small business development center associations 
to train all veterans, including disabled veterans, in business 
training and management assistance, procurement opportunities, and 
other business areas. It also establishes an Office of Veterans 
Business Development and the position of Associate Administrator for 
Veterans Business Development at the Small Business Administration. 
This position will be responsible for the formulation, execution, and 
promotion of programs to provide assistance for small businesses owned 
and controlled by veterans. Currently, SBA has at least ten Associate 
Administrators. A minimum of four are required by law, and the titles 
of only two are specified.
  Third, the Task Force urged a veterans' company to address veterans' 
small business issues. The Veterans Entrepreneurship and Small Business 
Development Act of 1999 creates the National Veterans Business 
Development Corporation (NVBDC), the bill's crown jewel. This 
Corporation will coordinate private and public resources from Federal 
organizations--for example the Small Business Administration and the 
Department of Veterans Affairs--to establish and maintain a network of 
information and assistance centers for use by veterans and the public. 
Furthermore, NVBDC will have the power to raise and disburse funds, 
establish initiatives, and award grants in furtherance of its goal of 
establishing a cohesive assistance and information network for veteran 
owned business. This is important as H.R. 1568 requires the NVBDC to 
become self-sustaining by eliminating the Corporation's minimal Federal 
funding in four years. Finally, the NVBDC will also establish an 
advisory board on professional certification to work on the problems 
service members with military technical face in transitioning into the 
private sector workforce. The board will be composed of representatives 
of professional certification organizations, such as the Coalition for 
Professional Certification and veterans organizations such as the 
American Legion. In addition, NVBDC's board of directors shall invite 
representatives of the Armed Services and the Department of Labor to 
participate.

  Fourth, the Task Force sought a regulation classifying veteran-owned 
businesses as a ``socially and economically disadvantaged business 
group.'' Rather than a regulation, H.R. 1568 affords veteran-owned 
small businesses an opportunity to compete on the same level with small 
business concerns owned and controlled by socially and economically 
disadvantaged individuals. This requires that loan making decisions 
shall be resolved in favor of the prospective borrower and requires SBA 
to establish a three-percent goal for contracting with small business 
concerns owned and controlled by service-disabled veterans.
  Mr. Speaker, we all recognize our Armed Forces safeguard our freedoms 
and liberty at

[[Page 21169]]

great sacrifice to themselves. Our veterans liberated Europe and the 
Pacific in the 1940s, stopped the spread of communism in the 1950's, 
1960, and 1970s, and freed oppressed peoples in the 1980s and 1990s. 
These public servants willingly worked for the United States 
government. H.R. 1568, the Veterans Entrepreneurship and Small Business 
Development Act of 1999, makes government work for them. It provides 
them the opportunity to enjoy the fruits of their labor and the 
blessings of liberty which they secured.
  Mr. Speaker, I attach hereto a section-by-section analysis and urge 
my colleagues to support H.R. 1568.

                      Section-by-Section Analysis

     SECTION 1. SHORT TITLE.

       Designates the bill as the ``Veterans Entrepreneurship and 
     Small Business Development Act of 1999''.

     SECTION 2. TABLE OF CONTENTS.


                      TITLE I--GENERAL PROVISIONS

     SECTION 101. FINDINGS.

       This section describes Congressional findings regarding the 
     sacrifices and efforts of veterans and their value to the 
     American economy as small business owners.

     SECTION 102. PURPOSE.

       Describes the purpose of the Act, to encourage the SBA and 
     other agencies to implement further efforts to assist 
     veterans, particularly service-disabled veterans in the 
     formation and growth of small businesses.

     SECTION 103. DEFINITIONS.

       Establishes definitions of veteran owned and service-
     disabled veteran owned small business concerns. The term 
     ``service-disabled veterans'' is based on the definition in 
     Title 38 of the US Code.


                TITLE II--VETERANS BUSINESS DEVELOPMENT

     SECTION 201. OFFICE OF VETERANS BUSINESS DEVELOPMENT.

       Establishes an Office of Veterans Business Development and 
     the position of Associate Administrator for Veterans Business 
     Development at the Small Business Administration. this 
     position will be responsible for the formulation, execution, 
     and promotion of programs to provide assistance for small 
     businesses owned and controlled by veterans. There are 
     currently at least ten Associate Administrators at the SBA. A 
     minimum of four are required by law, and the titles of only 
     two are specified.

     SECTION 202. NATIONAL VETERANS BUSINESS DEVELOPMENT 
                   CORPORATION.

       This section establishes a federally chartered corporation, 
     the National Veterans Business Development Corporation, for 
     the purpose of guiding and monitoring public and private 
     sector initiatives to assist the Nation's veterans in their 
     efforts to form and grow small businesses. The most 
     significant single purpose of the corporation will be to work 
     with the public and private sectors to establish an 
     independent nationwide network of business assistance and 
     information centers for veterans. The Corporation will 
     managed by a Board of Directors appointed in a bipartisan 
     fashion by the President based on recommendations from the 
     Congress. It will have the power to raise and disburse 
     funds, establish initiatives, and award grants in 
     furtherance of its goal of establishing a cohesive 
     assistance and information network for veteran owned 
     business.
       The NVBDC will also establish an advisory board on 
     professional certification to work on the problems service 
     members with military technical training face in 
     transitioning into the private sector workforce. The board 
     will be composed of representatives of professional 
     certification organizations, such as the Coalition for 
     Professional Certification and veterans organizations such as 
     the American Legion. In addition, the Board of Directors of 
     the NVBDC shall invite representatives of the Armed Services 
     and the Department of Labor to participate.
       While they will have no mandate to change or enforce 
     regulations, the Committee hopes that the military and 
     private sector will work in a cooperative fashion to satisfy 
     both the Armed Services training requirements and the public 
     sector's need for standard certification and provide 
     transitioning servicemembers with an easy entrance to 
     civilian life.
       To start the NVBDC it will have an initial authorization of 
     $2 million in the first year and $4 million in the second and 
     third years, dropping back to $2 million in the fourth and 
     final year. After the fourth year the Corporation will be 
     self funded from private donations and no longer be eligible 
     for federal funds. The Committee has already received 
     testimony in support of private funding of the NVDBC and 
     fully expects the Corporation to be self supporting within 
     four years.

     SECTION 203. ADVISORY COMMITTEE ON VETERANS AFFAIRS.

       Establishes an eight member committee to provide 
     independent advice and policy recommendations to the SBA, 
     Congress, and the President. The committee will conduct 
     hearings, collect information from federal agencies, develop, 
     monitor and promote programs to aid veteran's business 
     development, and issue an annual report to the Congress. The 
     Committee will terminate on September 30, 2004 and its 
     responsibilities will devolve onto the National Veterans 
     Business Development Corporation.


                    TITLE III--TECHNICAL ASSISTANCE

     SECTION 301. SCORE PROGRAM.

       This section requires the Service Corps of Retired 
     Executives (SCORE) and the SBA to establish a program for 
     directing management and technical assistance to veteran-
     owned small business and veterans wishing to establish small 
     business concerns. SCORE provides advice and technical 
     assistance to small businesses free of charge through a 
     nationwide network of volunteers.

     SECTION 302. ENTREPRENEURIAL ASSISTANCE.

       This section requires the Small Business Development Center 
     (SBDC) system and the SBA to establish a program for outreach 
     and assistance to veterans and veteran-owned small 
     businesses. SBDC's provide free management and technical 
     assistance to small business owners through over 900 sites 
     located at colleges and universities nationwide.

     SECTION 303. MILITARY RESERVISTS TECHNICAL ASSISTANCE.

       Establishes a program of technical and managerial 
     assistance, through the SBA, for military reservists who are 
     self-employed or are small business owners and are called to 
     active military duty. Requires the SBA to enhance its 
     publicity of such assistance for the duration of Operation 
     ``Allied Force''.


                     TITLE IV--FINANCIAL ASSISTANCE

     SECTION 401. GENERAL BUSINESS LOANS.

       Includes service-disabled veterans with handicapped 
     individuals in provisions requiring that loan making 
     decisions shall be resolved in favor of the prospective 
     borrower. H.R. 1568 also clarifies that this provision 
     applies only to guaranteed loans and makes no requirement 
     that the SBA reinstitute the direct programs eliminated in 
     the Administration budget submission in 1995. According to 
     the Administration's testimony on June 23, 1999 such a result 
     was not desired by the SBA. Therefore, an amendment was 
     offered to specify and reinforce the Administration's 
     opposition to those programs.

     SECTION 402. ASSISTANCE TO ACTIVE DUTY MILITARY RESERVISTS.

       Requires the SBA to establish a system for loan deferrals 
     for small business owners called up for active duty. Also 
     requires the SBA to make economic injury disaster loans 
     available to self-employed individuals who are called to 
     active duty for the National Guard and Reserves.

     SECTION 403. MICROLOAN PROGRAM.

       Makes veterans eligible for assistance under the SBA's 
     microloan program which provides small loans (under $25,000) 
     to people seeking initial financing for small business start-
     up or expansion.

     SECTION 404. DELTA LOAN PROGRAM.

       Includes veteran owned small businesses in the eligibility 
     categories for assistance under the DELTA loan program at the 
     SBA.

     SECTION 405. STATE DEVELOPMENT COMPANY PROGRAM.

       Includes the formation and creation of veteran-owned small 
     business in the public policy goals sought in the 504 loan 
     program for construction and long-term equipment loans.


                          TITLE V--PROCUREMENT

     SECTION 501. SUBCONTRACTING.

       Requires the inclusion of small business concerns owned and 
     controlled by veterans in the mandatory subcontracting clause 
     in all government contracts that establishes subcontracting 
     plans.

     SECTION 502. PROCUREMENT ASSISTANCE.

       This section requires the SBA to establish a five percent 
     goal for contracting with small business concerns owned and 
     controlled by service disabled veterans.


                       TITLE VI--REPORTS AND DATA

     SECTION 601. REPORTING REQUIREMENTS.

       Requires the heads of each federal agency to report to the 
     Small Business Administration concerning contracting with 
     veteran owned and service-disabled veteran owned small 
     businesses.

     SECTION 602. REPORT ON SMALL BUSINESS AND COMPETITION.

       Requires the SBA to include information on small business 
     concerns owned by veterans and service disabled veterans in 
     the annual report on small business participation and 
     opportunities in federal procurement.

     SECTION 603. ANNUAL REPORT.

       This section requires the Administrator to submit an annual 
     report to Congress on the needs of veteran owned small 
     business and the progress of programs designed to aid and 
     promote veterans small business ownership. The Administrator 
     shall also provide statistical information on veterans 
     participation in SBA programs.

     SECTION 604. INFORMATION COLLECTION.

       Requires the collection of procurement data on veterans and 
     service-disabled veteran owned small businesses, and 
     collection of information on the procurement practices of 
     each federal agency. All such information is to be made 
     available to any small business concern requesting it. The 
     information is also to be distributed to federal procurement 
     officers. Also requires the SBA and VA to work to establish a 
     database on veteran owned small business concerns.


                  TITLE VII--MISCELLANEOUS PROVISIONS

     SECTION 701. ADMINISTRATOR'S ORDER.

       Requires the administrator to strengthen and reissue the 
     order implementing the provisions of PL93-237 which requires 
     the SBA

[[Page 21170]]

     to fully include veterans in all the programs, purposes and 
     activities of the agency.

     SECTION 702. OFFICE OF ADVOCACY.

       Requires the Chief Counsel for Advocacy of the US Small 
     Business Administration to include an evaluation of the 
     efforts of the federal government to assist veteran owned 
     small business concerns as one of his primary functions. The 
     Chief Counsel is also required to provide statistical 
     information on veterans utilization of federal programs. Also 
     requires the Chief Counsel to make recommendations to the 
     Administrator of the SBA and Congress on programs and efforts 
     to assist veteran owned small business concerns.

     SECTION 703. FIXED ASSET SMALL BUSINESS LOANS.

       Requires the Government Accounting Office to conduct a 
     study of the feasibility of using the VA home ownership loan 
     program as a source of fixed asset financing for veteran-
     owned small businesses.

     

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