[Federal Register Volume 62, Number 71 (Monday, April 14, 1997)]
[Proposed Rules]
[Pages 18059-18062]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 97-9585]


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FEDERAL DEPOSIT INSURANCE CORPORATION

12 CFR Part 361

RIN 3064-AB95


Minority and Women Outreach Program--Contracting; and Individuals 
With Disabilities Outreach Program

AGENCY: Federal Deposit Insurance Corporation.

ACTION: Proposed rule.

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SUMMARY: The FDIC proposes for public comment amendments to its 
regulations to provide that the FDIC certify the eligibility of 
businesses and law firms for the minority and women's contracting 
program. The formal certification procedure, similar to what the former 
Resolution Trust Corporation had in place, would replace the current 
self-certification of minority and women owned businesses and law 
firms. This amendment will also establish an outreach program for 
individuals with disabilities.

DATES: Comments must be submitted on or before June 13, 1997.

ADDRESSES: Send written comments to Jerry L. Langley, Executive 
Secretary, FDIC, 550 17th Street, NW., Washington, DC 20429. Comments 
may be hand-delivered to Room 400, 1776 F Street, NW., Washington, DC 
20429 on business days between 8:30 a.m. and 5:00 p.m. [FAX number: 
(202)898-3838; Internet: [email protected]]. Comments will be available 
for inspection and photocopying at the FDIC's Reading Room, room 7118, 
550 17th Street, NW., Washington, DC 20429, between 9:00 a.m. and 4:30 
p.m. on business days.

FOR FURTHER INFORMATION CONTACT: Mary A. Terrell, Associate Director, 
Office of Diversity and Economic Opportunity, (202) 416-4322; Pamela H. 
Peters, Senior Attorney, Office of Diversity and Economic Opportunity, 
(202) 416-4325; or Gladys Gallagher, Counsel, Legal Division, (202) 
898-3833.

SUPPLEMENTARY INFORMATION:

Paperwork Reduction Act

    Consistent with this proposed rule, the FDIC proposes to modify a 
collection of information already approved by the Office of Management 
and Budget (OMB), ``Forms Relating to FDIC Outside Counsel Services 
Contracting,'' OMB Clearance No. 3064-0122, by adding a new form, 
``Minority and Women-Owned Law Firm Certification Form'' and a 
supporting documentation requirement. This collection of information 
revision has been submitted to OMB for review and approval pursuant to 
the Paperwork Reduction Act of 1995 (PRA) (44 U.S.C. 3501 et seq.). 
Comments are invited on: (a) Whether the collection of information is 
necessary for the proper performance of the FDIC's functions, including 
whether the information has practical utility; (b) the accuracy of the 
estimates of the burden of the information collection, including the 
validity of the methodology and assumptions used; (c) ways to enhance 
the quality, utility, and clarity of the information to be collected; 
and (d) ways to minimize the burden of the information collection on 
respondents, including through the use of automated collection 
techniques or other forms of information technology.
    Comments should be addressed to the Office of Information and 
Regulatory Affairs, OMB, Attention: Desk Officer Alexander Hunt, New 
Executive Office Building, Room 3208, Washington, DC 20503, with copies 
of such documents sent to Steven F. Hanft, Assistant Executive 
Secretary (Regulatory Analysis), FDIC, Room F-400, 550 17th Street, 
NW., Washington, DC 20429. OMB is required to make a decision 
concerning the collection of information contained in these proposed 
regulations between 30 and 60 days after publication of this document 
in the Federal Register. Therefore, a comment to OMB is best assured of 
having its full effect if OMB receives it within 30 days of 
publication. This does not affect the deadline for the public to 
comment to the FDIC on the proposed regulation. A copy of a draft 
Minority and Women-Owned Law Firm Certification Form may be obtained, 
free of charge, by contacting Mary A. Terrell, at the address 
identified above.
    The regulatory basis for the Minority and Women-Owned Law Firm

[[Page 18060]]

Certification Form is found in Sec. 361.7(a)(2) of this proposed rule. 
A law firm that desires to be designated as a minority and/or women-
owned law firm will be required to complete the certification and 
submit it to the FDIC's Office of Diversity and Economic Opportunity. 
In addition, such a law firm will be required to submit documentation 
supporting its minority or women-owned status. The information 
collected will be used by the FDIC as part of the certification process 
for law firms wishing to participate in the FDIC's minority and women-
owned law firms outreach program.
    The estimated annual reporting burden for the collection of 
information requirement in this rule is summarized as follows:
    Number of Respondents: 400.
    Number of Responses per Respondent: 1.
    Frequency of Response: Once every two years.
    Total Annual Responses: 200
    Hours per Response: \1/2\ hour for the certification form and 1\1/
2\ hours to obtain the supporting documents.
    Total Annual Burden Hours: 400
    As noted above, this PRA notice and request for comment pertains to 
an already approved collection of information, ``Forms Relating to FDIC 
Outside Counsel Services Contracting'', OMB Clearance No. 3063-0122. On 
January 10, 1997, the FDIC published a notice and request for comment 
in 62 FR 1455 proposing a different change to the same collection of 
information. The earlier notice pertained to the addition to the 
collection of information of a Form 1600/05 and a Form 5200/01 in which 
law firms, their employees, agents and subcontractors who provide 
services for the FDIC make representations and certifications regarding 
their integrity, fitness and conflicts of interest required by 12 CFR 
Part 366 and authorize the release of information about themselves for 
verification purposes. The determination to be made pursuant to the 
Minority and Women-Owned Law Firm Certification Form for which the FDIC 
is currently requesting comment is unrelated to the determination to be 
made pursuant to Forms 1600/05 and 5200/01 for which the earlier 
comment was sought.
    It is noted that in another collection of information already 
approved by OMB, ``Acquisition Services Information Requirements'', OMB 
Control No. 364-0072, the FDIC requests information about minority and 
women-owned status of businesses that provide the FDIC services other 
than legal services. No changes are being proposed in that collection 
at this time.

Regulatory Flexibility Act

    The Board of Directors hereby certifies that the proposed 
regulation does not have a significant economic impact on a substantial 
number of small entities within the meaning of the Regulatory 
Flexibility Act (5 U.S.C. 601 et seq.). This proposed regulation 
affects only those business and legal contractors who wish to provide 
services to the FDIC under its minority-and women-owned businesses 
contracting program.
    The proposed formal certification program will require businesses 
and law firms who wish to participate in the program to complete an 
application and submit those documents and records which they maintain 
during the normal course of business. Such efforts will not require 
trained personnel or special equipment and should not have significant 
economic impact on participating businesses and law firms. Therefore, 
the provisions of the Act relating to an initial and final regulatory 
analysis (5 U.S.C. 603 and 604) do not apply here.

Background

1. Certification of Minority- and Women-Owned Businesses and Law Firms

    Section 1216(c) of the Financial Institutions Reform, Recovery, and 
Enforcement Act of 1989 (FIRREA), Pub. L. 101-73, 103 Stat. 183, 
required that the Federal Deposit Insurance Corporation (FDIC) and the 
Resolution Trust Corporation (RTC) prescribe regulations to establish 
and oversee a minority outreach program to ensure inclusion, to the 
maximum extent possible, of minorities and women, and entities owned by 
minorities and women, including financial institutions, investment 
banking firms, underwriters, accountants, and providers of legal 
services, in all contracts entered into by the agency. According to 
FIRREA, minorities are defined as Asian American, Black American, 
Hispanic American and Native American.
    The FDIC's Minority and Women Outreach Program-Contracting policy 
was published in the Federal Register at 57 FR 15004 on April 24, 1992. 
The FDIC currently requires businesses and law firms to either ``self-
certify'' their minority or women ownership status, or submit a valid 
minority- and women-owned business (MWOB) certification received from a 
federal agency, designated state or authorized local agency. Based on 
this ``self-certification'' of their ownership status, MWOBs and MWOLFs 
have the opportunity to participate in the FDIC's minority and women 
contracting program.
    On October 27, 1995, pursuant to the requirements of section 6 of 
the RTC Completion Act, Pub. L. 103-204 (December 17, 1993), the FDIC/
RTC Transition Task Force (Transition Task Force) examined and 
presented Best Practices and Management Reform Recommendations (Best 
Practice Recommendations) on the operational differences and RTC 
management reforms related to minority and women's programs. The 
Transition Task Force examined the FDIC's and the RTC's certification 
process for MWOBs and MWOLFs, and recommended that the FDIC adopt a 
MWOB/MWOLF certification program similar to the RTC's which included a 
detailed document review and, when appropriate, on-site visits to 
verify a firm's MWOB/MWOLF status.
    By replacing the ``self-certification'' program with a formal 
program, the FDIC is exercising its discretion and taking the necessary 
action to ensure that the minority and women contracting program 
benefits those for whom it has been designed.
    The proposed amendment to the existing regulation is broad by 
design and is intended to announce that the FDIC has adopted a formal 
certification program. Detailed certification procedures will be 
incorporated into an FDIC directive that will further delineate the 
functions of various divisions and offices in the certification 
process. These procedures will require that MWOBs and MWOLFs complete 
the required business or legal registration/application package. MWOBs 
and MWOLFs will also be required to submit documentation, including but 
not limited to, articles of incorporation, bylaws, partnership and/or 
joint venture agreements, organizational charts, and lists of boards of 
directors showing minority and women ownership designations, to the 
ODEO.
    In lieu of the accompanying documents, MWOBs and MWOLFs may submit 
current formal certifications from other federal agencies. However, the 
FDIC shall at all times reserve the right to request any information 
that is deemed necessary to certify the status of a firm.
    Upon receipt of these documents, the ODEO will review the documents 
submitted. When appropriate, the ODEO may conduct on-site verifications 
based upon a contract award, legal engagement, or accumulated fees of

[[Page 18061]]

$50,000 or greater. Finally, the certification process and directive 
will also include an appeals process for those firms who have been 
denied MWOB/MWOLF status.
    All businesses that have ``self-certified'' their MWOB status shall 
submit the required certification documents prior to responding to 
Requests for Proposals or during the contracting process. Law firms 
that have previously ``self-certified'' their MWOLF status shall submit 
the required certification documents at the time they apply for, or 
renew, their FDIC Legal Services Agreement. Certification for law firms 
and businesses will remain valid for a two-year period.
    The establishment of the MWOB and MWOLF certification program will 
help foster and preserve the integrity of the FDIC's business and legal 
contracting activities. Additionally, the formal certification program 
will also serve to discourage fraudulent representations by businesses 
and law firms seeking to provide goods or services, or enter into 
contracts to provide goods or services, including legal services, to 
the FDIC in all of its capacities. The FDIC invites comment on whether 
the proposed rule, or some other alterative, would better achieve these 
objectives.

2. Individuals With Disabilities Outreach Program

    Under section 303 of the Riegle Community Development and 
Regulatory Improvement Act of 1994 (RCDRIA), 12 U.S.C. 4803, each 
federal banking agency is required to streamline and modify its 
regulations and policies in order to improve efficiency, reduce 
unnecessary costs, remove inconsistencies and outmoded and duplicative 
requirements, and to work jointly with other federal banking agencies 
to make uniform all regulations implementing common statutory or 
supervisory policies.
    In response to the RCDRIA, the FDIC and the other federal banking 
agencies are working to ensure that the regulations mandated by FIRREA 
concerning minority and women outreach programs are uniform and 
consistent. The Office of Thrift Supervision (OTS) and the Office of 
the Comptroller of the Currency (OCC) have established outreach 
components to their contracting programs that include individuals with 
disabilities. The FDIC believes that establishing an outreach program 
for firms owned by individuals with disabilities complies with 
applicable law and also satisfies the RCDRIA uniformity requirements 
even though the FDIC outreach program for firms owned by individuals 
with disabilities is not identical to those established by the OTS and 
OCC.
    This subpart does not treat individuals with disabilities as 
minorities, since FIRREA defines minorities as Asian American, Black 
American, Hispanic American, and Native American. However, the FDIC has 
authority pursuant to Section 9 (Third) of the Federal Deposit 
Insurance Act to establish an outreach program for firms owned and 
controlled by individuals with disabilities. The outreach program for 
individuals with disabilities is set forth in subpart B of part 361.

List of Subjects in 12 CFR Part 361

    Government contracts, Individuals with disabilities, Lawyers, Legal 
services, Minority businesses, Reporting and recordkeeping 
requirements, Women.

    For the reasons set out in the preamble, the Board of Directors of 
the Federal Deposit Insurance Corporation proposes to amend part 361 of 
chapter III of title 12 of the Code of Federal Regulations as follows:

PART 361--MINORITY AND WOMEN OUTREACH PROGRAM-CONTRACTING AND 
INDIVIDUALS WITH DISABILITIES OUTREACH PROGRAM

    1. Part 361 is amended by revising the part heading as set forth 
above.
    2. The authority citation for part 361 is removed.
    2a. Part 361 is amended by designating Secs. 361.1 through 361.11 
as subpart A and adding the subpart heading to read as follows:

Subpart A--Minority and Women Outreach Program--Contracting

    3. The authority citation for subpart A is added to read as 
follows:

    Authority: 12 U.S.C. 1833e.

    4. Section 361.7 is revised to read as follows:


Sec. 361.7  Minority and women owned business (MWOB) and minority and 
women owned law firms (MWOLF) certification.

    (a)(1) Each firm requesting minority and/or women-owned business or 
law firm (MWOB/MWOLF) status must undergo a formal certification 
process to be determined and conducted by the FDIC.
    (2) Each firm requesting designation as a minority and/or women-
owned business or law firm must submit an application and requested 
certification documents, in accordance with procedures established by 
the FDIC, which demonstrates that the firm meets the criteria 
established in Sec. 361.3(a). Upon receipt of a completed application, 
the FDIC will determine the eligibility of the firm for MWOB/MWOLF 
status.
    (3) In lieu of the certification documents requested in paragraph 
(a)(2) of this section, the FDIC may accept a current federal agency's 
certification of a firm as a MWOB/MWOLF. However, the FDIC shall at all 
times reserve the right to request any information necessary to certify 
the status of a firm.
    (b) All matters relating to MWOB/MWOLF status will be addressed by 
the FDIC Office of Diversity and Economic Opportunity, located at 801 
17th Street, N.W., Washington, D.C. 20434.
    5. A new subpart B, consisting of Sec. 361.20, is added to part 361 
to read as follows:

Subpart B--Individuals With Disabilities Outreach Program

Sec.
361.20  Outreach program for individuals with disabilities.

Subpart B--Individuals With Disabilities Outreach Program

    Authority: 12 U.S.C. 1819(Tenth).


Sec. 361.20  Outreach program for individuals with disabilities.

    (a) Purpose. This program has been established to ensure that 
persons with disabilities and firms owned by persons with disabilities 
are afforded the opportunity to participate in the FDIC's outreach 
activities. For purposes of this subpart, ``outreach'' shall mean those 
information and training activities designed to make firms aware of the 
FDIC's contracting opportunities.
    (b) Definition of individual with disabilities. In administering 
this subpart, the FDIC may, in its sole discretion, use the definition 
of the term individual with a disability as found in the Rehabilitation 
Act of 1973, 29 U.S.C. 701 et seq., for outreach purposes. The FDIC is 
not subject to the Rehabilitation Act and its amendments, and merely 
looks to this definition in the Rehabilitation Act, because the 
definition is commonly understood and applied.
    (c) Outreach activities. The outreach activities that the FDIC may 
undertake under this subpart include:
    (1) The identification of business entities owned by individuals 
with disabilities who can provide goods and services to the FDIC;
    (2) Distribution of information concerning third party contracting

[[Page 18062]]

opportunities directly and through trade associations representing 
business entities owned by individuals with disabilities;
    (3) Participation in conventions, seminars and professional 
meetings attended predominately by individuals with disabilities; and
    (4) Conducting seminars, meetings, workshops and other various 
activities to promote the inclusion of individuals with disabilities 
and the firms they own.

    By Order of the Board of Directors.

    Dated at Washington, D.C. this 25th day of March, 1997.

Federal Deposit Insurance Corporation.
Robert E. Feldman,
Deputy Executive Secretary.
[FR Doc. 97-9585 Filed 4-11-97; 8:45 am]
BILLING CODE 6714-01-P