[Federal Register Volume 63, Number 115 (Tuesday, June 16, 1998)]
[Notices]
[Pages 32857-32858]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 98-15869]


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DEPARTMENT OF COMMERCE

Minority Business Development Agency
[Docket No. 980608150-8150-01]
RIN 0640-ZA03


Revision of the Cost-Share Requirement and Applicability of the 
Ten Bonus Points to All Future Solicitations To Operate Minority 
Business Development Centers (MBDC)

AGENCY: Minority Business Development Agency, Commerce.

ACTION: Interim final policy request for comments.

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SUMMARY: In order to attract and retain a greater number of qualified 
firms to operate its MBDC program, MBDA is revising its cost-share 
requirement for financial award recipients from forty percent (40%) to 
fifteen percent (15%) to be applied to all future competitions for 
MBDCs, as well as to all prospective renewals and/or extensions of 
awards originally competed at the 40% cost-share level. MBDA is also 
extending its policy to give an additional ten (10) bonus points to the 
applications of community-based organizations in all future MBDC 
solicitations. Previously, the 40% cost-share requirement and the 10 
bonus points were applied to awards in certain designated geographic 
service areas only. The initial policies regarding these requirements 
were published in the Federal Register Notice of May 31, 1996, Vol. 51, 
page 27336 and continued on page 27337.

DATES: This interim policy is effective June 16, 1998. Comments on this 
interim policy must be submitted on or before July 16, 1998.

ADDRESSES: Comments should be sent to Mr. Paul R. Webber IV, Assistant 
Director, Minority Business Development Agency, U.S. Department of 
Commerce, Room 5073, 14th and Constitution Avenue, NW, Washington, D.C. 
20230.

FOR FURTHER INFORMATION CONTACT: Mr. Paul R. Webber IV at (202) 482-
5061.

SUPPLEMENTARY INFORMATION: Under Executive Order 11625, MBDA provides 
business development assistance to persons who are members of groups 
determined by MBDA to be socially or economically disadvantaged, and to 
business concerns owned and controlled by such individuals. To deliver 
this assistance, MBDA funds MBDCs that offer a full range of management 
and technical assistance services, coordinate public and private 
resources on behalf of clients, and serve as a conduit for information 
concerning business development.
    MBDA selects applicants to operate its MBDCs through a competitive 
solicitation process. The guidelines for operation of an MBDC are set 
forth in a detailed Competitive Application Package (CAP). The funding 
instrument for the MBDCs is a cooperative agreement, which, in addition 
to the CAP and the competitive solicitation published in the Federal 
Register, sets forth the applicable requirements which must be met by 
an MBDC operator (collectively, the ``program guidelines'').
    Under the program guidelines, selected geographic service areas 
were designated in the May 31, 1996, Federal Register, in which the 
Department of Commerce currently funds up to 60% of the total budgeted 
cost of operating an MBDC on an annual basis. The MBDC operator has 
been required to contribute at least 40% of the total project cost (the 
``cost-share requirement''). Prior to the Notice, MBDC operators were 
required to contribute only 15% of the total project costs. 
Contributions, which may be utilized in satisfying the cost-share 
requirement, include cash contributions, non-cash application 
contributions, third party in-kind contribution and client fees. In 
addition, the applications from those designated service areas were 
given an additional ten (10) bonus points for being community-based 
organizations that had received a programmatically acceptable and 
responsive score. In order to attract a greater number of qualified 
firms to compete in the MBDC program, all future MBDC solicitations, 
regardless of geographic service area, will be competed, with the 
Department of Commerce funding up to 85% of the total project cost. The 
operator will be required to contribute at least 15% of the total 
project cost in order to satisfy the cost-share requirement.
    In addition, under existing program guidelines, continued funding 
of an award is at the total discretion of MBDA based on such factors as 
the MBDC's performance, changes in availability of funds, and shifts in 
agency priorities. MBDA has determined that it is an agency priority to 
retain existing MBDC operators by easing the burden caused by a 40% 
cost-share requirement. It is also an agency priority to establish 
consistency and equity with regard to the cost-share requirement 
between existing MBDC operators and future operators. Accordingly, the 
cost-share requirement of existing MBDC operators will be decreased 
from 40% and will revert to MBDA's prior policy of 15% at the time of 
renewal and/or extension of

[[Page 32858]]

awards. However, the decrease in cost sharing will not be applied 
retroactively.
    Finally, based on prior experience with community-based 
organizations, MBDA has determined that it is in the interest of the 
MBDC program to encourage the participation of such organizations in 
the competition to operate MBDCs. Therefore, MBDA has determined that 
it is an agency priority to extend the policy of allowing 10 bonus 
points during the evaluation process to community-based organizations, 
which was limited to certain designated locations in the Federal 
Register notice of May 31, 1996, to all future MBDC solicitations. The 
MBDC evaluation scoring system will add 10 bonus points to the 
applications of community-based organizations which receive a 
programmatically acceptable and responsive score. Each qualifying 
application will receive the full 10 points. Community-based applicant 
organizations are those organizations currently located within the 
geographic service area designated in the solicitation for the award, 
and whose headquarters and/or principal place of business have been 
located within the geographic service area during the last five years. 
Where an applicant organization has been in existence for fewer than 
five years or has been present in the geographic service area for fewer 
than five years, the individual years of experience of the applicant 
organization's principals may be applied toward the requirement of five 
years of organization experience. The individual years of experience 
must have been acquired in the geographic service area which is the 
subject of the solicitation.

Statement of Policy

    In order to implement its revised program in support of the 
minority business sector, MBDA hereby revises its policy of requiring a 
40% cost-share requirement for MBDC awards in certain locations and 
establishes a cost-share requirement for all prospective MBDC awards of 
at least 15% of total project cost for financial assistance recipients. 
In addition, the cost-share requirement of existing MBDC operators will 
be decreased from 40% to 15% at the time of renewal and/or extension of 
awards. However, this decrease in cost sharing will not be applied 
retroactively. MBDA will also extend the policy of allowing 10 bonus 
points during the evaluation process to community-based organizations, 
which was limited to certain designated locations in the Federal 
Register notice of May 31, 1996, to all future MBDC solicitations.

Executive Order 12866

    This policy revision was determined to be not significant for 
purposes of E.O. 12866.

Administrative Procedure Act

    Since this notice of policy revision is a matter relating to public 
property, loans, grants, benefits, or contracts under 5 U.S.C. 
553(a)(2), the requirements of section 553 do not apply.

Regulatory Flexibility Act

    The Regulatory Flexibility Act does not apply to this notice of 
policy change because the notice was not required to be promulgated as 
a proposed rule before issuance in final form by 5 U.S.C. Sec. 553 or 
by any other law, As a result, neither an initial nor final Regulatory 
Analysis was required, and none has been prepared.

Executive Order 12612

    This policy statement does not contain policies with Federalism 
implications sufficient to warrant preparation of a Federalism 
assessment under Executive Order 12612.

    Authority: 15 U.S.C. 1512 and Executive Order 11625.

    Dated: June 4, 1998.
Juanita E. Berry,
Federal Register Liaison Officer, Minority Business Development Agency.
Courtland Cox,
Director, Minority Business Development Agency.
[FR Doc. 98-15869 Filed 6-15-98; 8:45 am]
BILLING CODE 3510-21-M