[Federal Register Volume 62, Number 109 (Friday, June 6, 1997)]
[Notices]
[Pages 31066-31068]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 97-14757]


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DEPARTMENT OF COMMERCE

Bureau of the Census


1997 Survey of Minority-Owned Business Enterprises (SMOBE) and 
1997 Survey of Women-Owned Businesses (WOB); Proposed Collection; 
Comment Request

SUMMARY: The Department of Commerce, as part of its continuing effort 
to reduce paper work and respondent burden, invites the general public 
and other Federal agencies to take this opportunity to comment on 
proposed and/or continuing information collections, as required by the 
Paperwork Reduction Act of 1995, Public Law 104-13 (44 U.S.C. 
3506(c)(2)(A)).

DATES: Written comments must be submitted on or before August 5, 1997.

ADDRESSES: Direct all written comments to Linda Engelmeier, 
Departmental Forms Clearance Officer, Department of Commerce, Room 
5327, 14th and Constitution Avenue, NW, Washington, DC 20230.

FOR FURTHER INFORMATION CONTACT: Requests for additional information or 
copies of the information collection instrument and instructions should 
be directed to Valerie Strang, Bureau of the Census, AGFS, Iverson Mall 
300-15, Washington, DC 20233, (301) 763-5726.

SUPPLEMENTARY INFORMATION:

I. Abstract

    The Census Bureau plans to conduct the 1997 Survey of Minority-
Owned Business Enterprises (SMOBE) and the 1997 Survey of Women-Owned 
Businesses (WOB). They are the only comprehensive, regularly collected 
sources of information on businesses owned by minorities and women. 
They are conducted as part of the economic census program which is 
required by law to be taken every 5 years under Title 13 of the United 
States Code, Sections 131, 193, and 224.
    Businesses will be eligible to be selected for this survey if they 
reported any business activity on any one of the following 1997 
Internal Revenue Service tax forms: 1040 (Schedule C), ``Profit or Loss 
from Business'' (Sole Proprietorship); 1065, ``U.S. Partnership Return 
of Income''; 1120S, ``U.S. Income Tax Return for an ``S'' 
Corporation''; or any one of the 1120 tax forms. Businesses will be 
asked questions about the gender, race, and ethnicity of the person(s) 
owning majority interest in the business.
    Within the last two months, 188 of our primary data users, 
including state and local governments, were canvassed to solicit their 
comments on proposed changes to the 1997 SMOBE/WOB programs. The 
proposed changes, summarized below, address the shortcomings of the 
1992 data and reflect, where feasible, comments received from the data 
users canvassed.
     Expand survey to include all corporations.
    In 1992, only subchapter ``S'' corporations in addition to 
partnerships and sole proprietorships were included for SMOBE. A small 
sample of ``C'' corporations was included in WOB to provide estimates 
at the industry division level only. A subchapter ``S''

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corporation is a special IRS designation for a legally incorporated 
business with 35 or fewer shareholders who elect to be taxed as 
individual shareholders rather than as a corporation. Approximately 2.5 
million ``C'' corporations, accounting for 75 percent of all U.S. 
business receipts, were not included in 1992. A ``C'' corporation is a 
legally incorporated business under state laws which, unlike a 
subchapter S corporation, has no restrictions on the number of 
shareholders required to qualify. While adding these corporations to 
the 1997 program will increase overall respondent burden, their 
inclusion will provide a more complete coverage of women- and minority-
owned businesses. The increase in burden resulting from the tax law 
change in 1996 which raised the allowable number of stockholders for 
subchapter ``S'' corporations to 75 is not separately estimated. 
Including ``C'' corporations will also allow us to track the true 
change in minority participation better in the future, since the survey 
results will not be impacted by changes in tax laws that affect who is 
likely to be a ``C'' or ``S'' corporation.
     Redefine the reporting unit to be the entire company.
    The SMOBE/WOB survey has historically defined a business as an 
entity that files a business income tax return. Businesses that have 
submitted an application for and received one or more employer 
identification (EI) numbers may have filed tax returns under more than 
one of these EIs. In past SMOBE/WOB surveys, each EI was treated as a 
separate business. For the 1997 survey, we propose to define all 
operations under the same ownership as one company or business, 
irrespective of the number of EIs the company has. We believe this 
definition is more appropriate for counting businesses. Furthermore, it 
will eliminate surveying the same business owner more than once. This 
change will have no effect on the receipts, employment, and payroll 
data for the survey, but will slightly reduce the count for the number 
of businesses. However, using administrative data, we should be able to 
provide 1997 firm counts on a basis comparable to 1992.
     Determine minority/women ownership based on gender/race/
ethnicity of the person(s) owning majority interest in the business, 
rather than on the simple majority of the number of owners, without 
regard to percentage of interest owned.
    Minority/women ownership of a business has historically been based 
on the gender/race/ethnicity of the majority of shareholders/partners, 
regardless of their percent of ownership in the business. Businesses 
with 50 percent or more women/minority owners have in the past been 
included in the women/minority business counts. For example, a business 
with two female owners and one male owner was counted as a woman-owned 
business, even if the male owned 90 percent of the interest in the 
business. With this proposed change, it would not be a woman-owned 
business.
    Businesses owned by a male and female, filing a joint tax return, 
were generally counted as female-owned, unless additional 
administrative data were available to determine otherwise. With this 
proposal, a separate tabulation will be made for those sharing equal 
interest in the business and will not be counted as female-owned. Only 
businesses in which women own a 51 percent or greater interest will be 
counted as WOB. This may cause a substantial decrease in the number of 
women-owned businesses. However, this method should provide results 
more consistent with business assistance programs and affirmative 
action directives.
    We are still examining how best to count businesses in which 
ownership is split by race/ethnicity with no single racial/ethnic group 
having majority interest. Please provide any recommendations regarding 
how these businesses should be tabulated.
    The following proposed reduction in coverage will help offset the 
increased costs of expanding coverage to all corporations:
     Change the level of business receipts required for 
inclusion in the surveys from $500 to $1,000.
    The 1992 program included virtually all nonfarm businesses, 
including all businesses and persons with receipts from self-employment 
of more than $500. Increasing the receipts level from $500 to $1,000 
will reduce the total number of businesses by approximately 10 percent, 
but reduce receipts totals by only $1 million or one-fourth of a 
percent.

II. Method of Collection

    The Census Bureau will use a mailout/mailback survey form to 
collect the data. The questionnaires will be mailed from our processing 
headquarters in Jeffersonville, Indiana. Three mail follow-ups will be 
conducted at approximately one-month intervals. Upon closeout of the 
survey, the response data will be edited and reviewed.

III. Data

    OMB Number: [not available].
    Form Numbers: One form will be used: MB97-1, Survey of Business 
Owners and Self-Employed Persons.
    Type of Review: Regular Review.
    Affected Public: Large and small businesses, other for-profit 
organizations and nonprofit institutions.
    Estimated Number of Respondents: 2.5 million. This 108 percent 
increase is due to the demand placed upon us to provide complete 
coverage of minority- and women-owned businesses; the need for reliable 
estimates at the state level by 2-digit SIC code; and better estimates 
for American Indian-owned businesses. In the past, ``C'' corporations 
have been excluded from the business universe and, therefore, the total 
number of minority- and women-owned businesses has been understated.
    Estimated Time Per Response: The average for all respondents is 10 
minutes or less.
    Estimated Total Burden Hours: The total estimated burden is 416,666 
hours. This increase over 1992 is due to the addition of ``C'' 
corporations to provide detailed comprehensive estimates for both 
women- and minority-owned businesses; and the need for reliable 
estimates at the state level by 2-digit SIC code, and better estimates 
for American Indian-owned businesses. However, the average response 
time per respondent is only 10 minutes.
    Estimated Total Cost: Included in the total cost of the 1997 
Economic Census, estimated to be $218 million.
    The cost to all respondents for their time to respond is 
$5,304,258. The cost is calculated by multiplying the annual burden 
hours (416,666) by the Bureau of Labor Statistics' 1993 estimate ($499 
for a 39.2 hour work week) for a private industry entry level 
accountant.
    Respondent's Obligation: Mandatory.
    Legal Authority: Title 13, United States Code, Sections 131, 193, 
and 224.

IV. Request for Comments

    Comments are invited on: (a) Whether the proposed collection of 
information is necessary for the proper performance of the functions of 
the agency, including whether the information shall have practical 
utility; (b) the accuracy of the agency's estimate of the burden 
(including hours and cost) of the proposed collection of information; 
(c) ways to enhance the quality, utility, and clarity of the 
information to be collected; and (d) ways to minimize the burden of the 
collection of information on respondents, including through the use of 
automated collection techniques or other forms of information 
technology.
    Comments submitted in response to this notice will be summarized 
and/or

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included in the request for OMB approval of this information 
collection; they will also become a matter of public record.

    Dated: June 2, 1997.
Linda Engelmeier,
Departmental Forms Clearance Officer, Office of Management and 
Organization.
[FR Doc. 97-14757 Filed 6-5-97; 8:45 am]
BILLING CODE 3510-07-P