[Federal Register Volume 65, Number 196 (Tuesday, October 10, 2000)]
[Proposed Rules]
[Pages 60255-60290]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 00-25428]



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Part II





Small Business Administration





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13 CFR Part 119



PRIME Act Grants; Proposed Rule

Federal Register / Vol. 65 , No. 196 / Tuesday, October 10, 2000 / 
Proposed Rules

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SMALL BUSINESS ADMINISTRATION

13 CFR Part 119


PRIME Act Grants

AGENCY: Small Business Administration.

ACTION: Notice of proposed rulemaking.

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SUMMARY: The U.S. Small Business Administration is proposing 
regulations to add new regulations to set up the Program for Investment 
in Microentrepreneurs Act (``PRIME'' or ``the Act''), created by Title 
VII of the Gramm-Leach-Bliley Act, enacted November 12, 1999. The 
proposed regulation sets forth the Act's grant requirements for 
qualified Microenterprise Development Organizations (``MDOs'') to: 
train and provide technical assistance to disadvantaged 
microentrepreneurs; build MDO's capacity to give disadvantaged 
microentrepreneurs such training and technical assistance; research and 
develop best practices for training and technical assistance programs 
for disadvantaged microentrepreneurs, and perform such other activities 
as the Administrator or designee determines are consistent with the 
Act.
    PRIME grants will enable MDOs to reach more disadvantaged 
microentrepreneurs with training and technical assistance, which will 
make a difference in their ability to start, grow, and sustain 
microenterprises in economically distressed, high unemployment areas. 
SBA will award a minimum of 75 percent of available funds to MDOs to 
use for training and technical assistance to disadvantaged 
microentrepreneurs. At a minimum, another 15 percent will be used to 
build MDOs' capacity to give more training and technical assistance. 
SBA will use the remaining funds to make grants for research and 
development on best practices or other purposes to improve MDOs' 
services to PRIME's ultimate beneficiaries--disadvantaged 
microentrepreneurs.

DATES: Submit comments on or before November 9, 2000.

ADDRESSES: Written comments should be sent to Jane Palsgrove Butler, 
Associate Administrator, Microenterprise Development Branch, Office of 
Financial Assistance (OFA), U.S. Small Business Administration, 409 3rd 
Street, SW, Washington, DC 20416, 202-205-6497.

FOR FURTHER INFORMATION CONTACT: Jody Raskind, Chief, Microenterprise 
Development Branch, 202-205-6485.

SUPPLEMENTARY INFORMATION: Congress recognized that many disadvantaged 
microentrepreneurs lack sufficient training and education to gain 
access to capital and to conduct other activities necessary to 
establish, maintain, and expand their businesses. It enacted the 
Program for Investment in Microentrepreneurs Act (``PRIME'' or ``the 
Act'') to augment training and technical assistance under the Small 
Business Act and other legislation. PRIME grants to qualified 
Microenterprise Development Organizations (MDOs) will help meet 
training and technical assistance needs for disadvantaged 
microentrepreneurs, thereby encouraging entrepreneurship and capital 
formation at the community level.
    The Congressional mandate to provide cognitive support to the 
target market through the Act is recognition that many low income and 
very low-income entrepreneurs need training and technical assistance to 
start, operate, strengthen, or expand their businesses. In order to 
achieve measurable success, technical assistance providers must be 
accessible, consistent and committed to the entrepreneur's progress 
over extended periods of time. The competency and capacity of these 
providers must also be measured. Research into the outcomes of support, 
its long-term effect, and how best to continue assistance is essential 
in determining the value of support over the long run.
    The U.S. Department of Commerce's Characteristics of Business 
Ownership shows that in 1987, approximately 17 percent (2.3 million) of 
businesses in the United States were operated by low-income and very 
low-income microentrepreneurs. Since then a variety of economic 
developments, including corporate downsizing, declining availability of 
lower skilled manufacturing jobs and expanded opportunities in the 
technology field, have combined to make microenterprise an increasingly 
more viable option in the U.S. economy.
    The Aspen Institute estimated that during 1997 microlenders 
nationwide provided business assistance to 172,000 microentrepreneurs, 
a mere fraction of low-and very-low income individuals involved in 
microenterprise. The Institute further estimated that of that number, 
about 57,000 actively pursued and benefited from sustained business-
based training and technical assistance. Of those, approximately 6,000 
received loans.
    One of the major constraints is the cost of providing this training 
and technical assistance. Current private sector sources simply are not 
meeting the need. The Act, therefore, focuses on expanding the 
cultivation, support and motivation of these low- and very-low income 
microentrepreneurs. It will also help build the capacity of the 
microenterprise industry in order to deliver vital services to a much 
greater segment of the 2.3 million or more low income and very low 
income microentrepreneurs. One of the goals of the PRIME program is to 
be a resource for MDOs as they grow and develop and ultimately become 
self-sustaining.
    The Act authorizes SBA to make grants to ``qualified 
organizations'' to fund training and technical assistance for 
disadvantaged microentrepreneurs. It also authorizes SBA to make grants 
to increase the training and technical assistance capacities of MDOs. 
Further, it provides funding for grants for research and development, 
and other undertakings deemed by the Administrator or designee to be 
consistent with the purposes of the Act. The PRIME program requires 
that grants made by SBA be matched by grantees from non-Federal 
sources. The proposed regulations set up four categories of technical 
assistance grants targeted to these purposes.
    Grants made either for the purpose of providing technical 
assistance to disadvantaged microentrepreneurs or for capacity building 
purposes initially will be awarded, on a competitive basis, in amounts 
not less than $50,000. Such grants may be renewable, annually, for up 
to 4 additional years. Renewal of an existing grant will take place at 
the discretion of the SBA and will be based on the availability of 
funds, continued legislative authorization, and the individual 
grantee's performance in terms of goals met, milestones achieved, and 
demonstrated results.
    Grants for research and development will also be awarded on a 
competitive basis, though not subject to the $50,000 minimum award. 
These grants may also be renewed based on the appropriateness of 
extended funding periods, availability of funds, continued legislative 
authorization and appropriation and performance.
    PRIME will be implemented with a clear focus on the applicants' 
abilities to meet the purposes of the Act. Accountability and outcomes 
will be an ongoing consideration during the grant period. Applicants 
for funding for technical assistance to disadvantaged 
microentrepreneurs will be evaluated based on such items as technical 
capabilities; market penetration potential; ability to meet stated 
goals; historical performance; key personnel; resource management; 
community partnering and collaboration with state and local entities; 
accountability for

[[Page 60257]]

outcomes; program sustainability; and replicability of program design. 
Applicants for funding as capacity builders will be similarly 
evaluated. Continued performance of these two groups will be measured 
in terms of such items as number of clients served; range and quality 
of service; number of businesses started, stabilized, expanded, and/or 
funded; number of jobs created; business survival rates; capital 
formation; and non-business outcomes such as wage employment.
    SBA is inviting public comment on how the agency intends to fulfill 
the purposes of the Act. SBA intends to award PRIME grants so that they 
reach MDOs that most clearly serve, have the potential to serve, or can 
best improve services to those microentrepreneurs with the greatest 
need for business-based training and technical assistance.

Section by Section Analysis

    The following is a section by section analysis of each provision of 
SBA's proposed regulations to implement the Act.
    Section 119.1 of Part 119 states the purpose of PRIME--to make 
grants to qualified MDOs to provide training and technical assistance 
to disadvantaged microentrepreneurs; to build MDO's service provider 
capacities; to pursue research and development in the field of 
microenterprise development; and for other purposes deemed by the 
Administrator or designee to be consistent with the Act.
    Section 119.2 sets forth definitions found in the Act, and further 
defines terms not included in the Act. The following terms were either 
not included or were not fully defined in the Act:
Capacity Building Grant in Sec. 119.2(a); developer in Sec. 119.2(d); 
disadvantaged entrepreneur or disadvantaged microentrepreneur in 
Sec. 119.2(e); Discretionary Grant in Sec. 119.2(f); economically 
disadvantaged entrepreneur or economically disadvantaged 
microentrepreneur in Sec. 119.2(g); emerging microenterprise 
development organization or program in Sec. 119.2(h); grantee in 
Sec. 119.2(i); group in Sec. 119.2(j); large and small microenterprise 
development organization  or program in Secs. 119.2(n) and (v); local 
community in Sec. 119.2(o); qualified organization in Sec. 119.2(s); 
Research and Development Grant in Sec. 119.2(t); severe constraints on 
available sources of matching funds in Sec. 119.2(u); Technical 
Assistance Grant in Sec. 119.2(w).
    In defining these terms, SBA considered the policy objectives of 
the Act and how the definitions proposed will further the intent of 
Congress to ensure that PRIME grants reach its intended audience.
    SBA proposes a definition of Indian tribe jurisdiction in 
Sec. 119.2(l) consistent with other Federal laws extending Federal 
assistance to Indian country.
    Section 119.3 lists organizations eligible to apply for PRIME 
grants:
    (1) non-profit MDOs or groups of MDOs with demonstrated records of 
delivering microenterprise services to disadvantaged entrepreneurs;
    (2) a private, non-profit entity serving or seeking to serve other 
qualified organizations;
    (3) MDOs or programs accountable to local communities and working 
with State, local or tribal governments; and
    (4) an Indian tribe acting on its own behalf, if no private 
organization or program as defined in the Act exists within its 
jurisdiction.
    Section 119.4 lists the uses for PRIME grants permitted by the Act:
    (1) training and technical assistance for disadvantaged 
microentrepreneurs;
    (2) capacity building services for MDOs;
    (3) research and development on best practices in microenterprise; 
and
    (4) other activities not covered by the first three categories and 
deemed by the Administrator or designee to be consistent with the Act's 
purposes.
    Section 119.5 states the Act's parameters for allocating PRIME 
grants and their apportionment among the permitted uses of PRIME funds. 
50 percent of the number of the grants will be awarded to qualified 
MDOs assisting very low-income persons, including those on Indian 
reservations. The categorical allocation of PRIME grants will be:
    (1) at least 75 percent to MDOs providing training and technical 
assistance to disadvantaged microentrepreneurs;
    (2) at least 15 percent to organizations providing training and 
capacity building services to MDOs; and
    (3) the remainder to be divided between research and development 
and for other purposes as the Administrator or designee deems 
consistent with the Act.
    Section 119.6 states awards will be not less than $50,000 for 
training and technical assistance and capacity building. Although the 
Act sets no minimum, SBA decided that a certain minimum sum is needed 
for MDOs to carry out effective training and technical assistance and 
capacity building to further the purposes of the Act. The Act limits 
the maximum sum a single MDO may receive in one fiscal year to $250,000 
or 10% of PRIME funds available in that fiscal year, whichever is less.
    Section 119.7 states that subject to availability of funds and 
continuing authorization of PRIME, awards will be made to grantees on 
an annual basis, and will allow for the initial grant plus up to 4 
option years, for a total of 5 years. After the initial grant, grant 
awards for following option years will be in declining amounts, 
declining by 20 percent of the initial grant amount in each successive 
year.
    Section 119.8 requires a 50 percent match for PRIME grants. It 
states what resources a grantee may use to fulfill them and the 
circumstances in which SBA may reduce or eliminate the match 
requirement. It sets a 10 percent limit on exemptions that may be made 
in a single fiscal year.
    For example, combining the requirements of Secs. 119.7 and 119.8, 
if a grantee receives an initial grant of $100,000, the grantee will 
receive $80,000 in the first option year, $60,000 in the second option 
year, $40,000 in the third option year, and $20,000 in the fourth 
option year. The grantee will be subject to a 50 percent match for each 
year--$50,000 for initial year, $40,000 for first option year, $30,000 
for second option year, $20,000 for third option year, and $10,000 for 
fourth option year.
    Section 119.9 states that SBA will issue Programs Announcements 
seeking PRIME grant applications. SBA believes a competitive process 
will allow a greater number of varied, diverse proposals that will 
accomplish the goals of the Act.
    Section 119.10 restates the Act's requirement that SBA not prefer 
SBA Microloan Program participants under Sec. 7(m) of the Small 
Business Act over non-participants or former participants in that 
program. Congress intended PRIME grants to help MDOs serve a greater 
number of disadvantaged entrepreneurs than currently receive 
assistance. Though Microloan participants and former participants will 
still be eligible, avoiding a preference for them will enable SBA to 
broaden opportunities for training and technical assistance, rather 
than duplicating existing programs.
    Section 119.11 sets forth information that will be requested in an 
application for funding under PRIME, based on the 4 categories of PRIME 
grants described in Sec. 119.4.
    Section 119.12 explains factors that will affect grant application 
consideration. To further the Act's goals to assist disadvantaged 
microentrepreneurs most in need of training and technical assistance, 
SBA will initially give special consideration

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to organizations located in and serving areas of, or with a history of 
successful outreach to, low-income and very low-income persons. SBA 
believes this approach will further the goals of the Act by directing 
grant funds to those microentrepreneurs who are at the greatest 
disadvantage.
    Section 119.13 explains how grantees may make subgrants from PRIME 
awards. Subgrants will enable more MDOs to provide training and 
capacity building, and will enable them to expand the technical 
assistance network available to disadvantaged entrepreneurs. To make 
sure that funds are used to carry out purposes of the Act, SBA is 
requiring grantees to obtain its prior approval for subgrantees. The 
Act limits how much grantees may use for administrative expenses 
related to making subgrants.
    Section 119.14 sets forth limitations on use of program income.
    Section 119.15 explains carryover procedures from one fiscal year 
to the next or unexpended Federal funds.
    Section 119.16 advises the public about SBA reporting, record 
keeping, and related requirements. Congress stated its intent for 
qualified organizations to maintain records as the Riegle Community 
Development Act of 1994 (``Riegle Act'') requires of community 
development financial institutions under 12 U.S.C. Sec. 4714. SBA will 
include the details of such requirements in its Program Announcements.
    Section 119.17 advises the public about SBA oversight functions, 
including additional reporting requirements in accordance with 
applicable OMB circulars.
    Section 119.18 sets forth restrictions against lobbying.
    Section 119.19 explains that fundraising costs are not allowable 
expenditures of grant funds under the Act.
    Section 119.20 explains process for grantees and subgrantees to 
raise conflict of interest matters with SBA.
    Appendix A of this rule contains the Program Announcements SBA 
proposes to issue to potential applicants. SBA chose to draft three 
separate Program Announcements, one for each of the first three grant 
categories identified in Sec. 119.4. The Program Announcements (and 
their appendices) include such items as the purpose and overview of the 
PRIME Program, program eligibility and evaluation criteria, application 
requirements and instructions, reporting and recordkeeping 
requirements. SBA reserves the right to simultaneously review multiple 
Program Announcement responses from an applicant applying to receive a 
grant under more than one of the categories listed in Sec. 119.4. SBA 
welcomes comments on any aspect of the proposed Program Announcements 
(and their appendices).

Compliance With Executive Order 12866, 12988 and 13132, the 
Regulatory Flexibility Act, 5 U.S.C. 601-12, and the Paperwork 
Reduction Act, 44 U.S.C. Ch. 35

    The Office of Management and Budget (OMB) reviewed this rule as a 
``significant'' regulatory action under Executive Order 12866.
    SBA has determined that this proposed rule will 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. 601-612. 
Because Congress has limited the funding level for this program, it can 
only serve a limited number of small businesses by making grants to the 
defined organizations.
    For purposes of the Paperwork Reduction Act, 44 U.S.C. Ch. 35, SBA 
will submit to the Office of Management and Budget (OMB) our proposed 
Program Announcements for the PRIME program. SBA will request OMB to 
approve or disapprove of these collections of information 30 days after 
submission. SBA proposes using three separate Program Announcements, 
one for each of the first three grant categories identified in 
Sec. 119.4. The data collection requirements of the various Program 
Announcements (and their appendices) are described generally within 
this proposed regulation. The specific data collection requirements can 
be found in the Program Announcements themselves, which are attached to 
this proposed rule as Appendix A. You may also obtain a copy of the 
proposed Program Announcements for comments on the data collection 
requirements by visiting SBA's website at www.sba.gov.
    The following list identifies the sections of this proposed 
regulation which describe generally the data collection requirements 
found within the Program Announcements (and their appendices).
    (1) As referenced in Sec. 119.11 (What information will be 
requested in an application under the PRIME program?) and Sec. 119.12 
(What criteria will SBA use to evaluate applications for funding under 
the PRIME program?), SBA proposes requesting information, such as, 
basic identifying information and core data, management and 
organization information, descriptions of past and present performance 
in serving low and very low income individuals, technical 
qualifications of the applicant, descriptions of activities proposed 
using PRIME grant funds, information regarding community partnering 
efforts, and reporting capabilities.
    SBA needs this information to evaluate applicants and ensure that 
awards are made in furtherance of the PRIME program's objectives. SBA 
anticipates that the respondents to this request will include those 
organizations identified in Sec. 119.3 (What types of organizations are 
eligible to apply for PRIME grants?). Based upon the Agency's knowledge 
of the industry, SBA estimates that approximately 500 applicants will 
apply to participate in the PRIME program. Respondents will need to 
submit the information referenced in Secs. 119.11 and .12 each time 
they apply to participate in the PRIME program. SBA estimates that it 
will take respondents 80 hours to respond to a Program Announcement and 
fulfill the reporting and recordkeeping requirements referenced below.
    (2) As referenced in Sec. 119.13 (How will an applicant make a 
subgrant?), SBA proposes requesting information that would support the 
awarding a subgrant, such as, a description of how the subgrant will 
allow the grantee to provide expanded services and benefits.
    SBA needs this information to assess whether issuing a subgrant is 
in the best interest of the objectives of the PRIME program. SBA 
anticipates that the respondents to this request will be grantees that 
have identified opportunities to enhance proposal implementation 
through the use of subgrants. Respondents will need to submit the 
information referenced in Sec. 119.13 each time they request a 
subgrant. SBA estimates that it will take respondents 10 hours per 
response to provide the information requested by this section.
    (3) As referenced in Sec. 119.15 (If a grantee is unable to spend 
the entire amount allotted for a single year, can the funds be carried 
over to the next year?), SBA proposes requesting information, such as, 
an explanation of why funds were not spent during the period in which 
they were awarded, budget and matching fund information.
    SBA needs this information to assess whether the grantee should be 
allowed to carry funds over to the next budget period. SBA anticipates 
that the respondents to this request will be grantees that have not 
expended their grant funds during the period in which they were 
awarded. If a respondent makes a request for funds to be carried over, 
this request will be made on an

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annual basis. SBA estimates that the time it will take respondents to 
provide this information is 1 hour per response.
    (4) As referenced in Sec. 119.16 (What are the reporting, record 
keeping, and related requirements for grantees?) and Sec. 119.17 (What 
types of oversight will SBA provide to grantees?), SBA proposes 
requesting a variety of data including narrative performance reports 
and financial status reports. The recipients of:
    (a) Technical Assistance and Capacity Building Grants will be 
required to provide SBA with annual performance and, initially, 
quarterly financial reports.
    (b) Research and Development Grants will be required to provide 
performance and financial reports in accordance with agreed upon 
milestones for each particular grant proposal.
    (c) Discretionary Grants will be required to provide reports as 
appropriate for their proposal or on a schedule as described for 
Technical Assistance and Capacity Building Grants.
    SBA needs this information to assess the impact of services 
provided by the grantees and to measure the success rate of individual 
clients, microenterprise development organizations, and the 
microenterprise development industry. SBA anticipates that all grantees 
will respond to this request as required by their respective grant 
category. SBA estimates that the time it will take respondents an 
average of 4 hours to provide this information.
    (5) As referenced in Sec. 119.19 (Is fundraising an allowable 
expense under the PRIME program?), SBA proposes requesting information 
supporting that the grantees have adequate fundraising resources for 
the non-Federal matching fund requirements of the PRIME program.
    SBA needs this information to ensure that the applicants for the 
PRIME program have the ability to satisfy the program's regulatory 
matching requirements. SBA will require this information each time a 
grantee applies for grant funds under the PRIME program. SBA estimates 
that it will take respondents 2 hours to provide this information.
    (6) As referenced in Sec. 119.20 (Should grantees and subgrantees 
raise conflict of interest matters with SBA?), SBA proposes requesting 
that each grantee or subgrantee provide a copy of its conflicts of 
interest policy.
    SBA needs this information to ensure that the grantees and 
subgrantees are in a position to avoid conflicts of interest, or the 
appearance of conflicts of interest, in the handling of grant funds or 
program provisions under the PRIME program. SBA anticipates that all 
grantees and subgrantees will provide this information. SBA will 
require that respondents provide this information once, prior to 
receiving funding under the PRIME program. SBA estimates that it will 
take respondents .50 burden hours to provide this information.
    SBA is seeking your comment on the following: (a) whether the 
information SBA is requesting is necessary for the proper performance 
of the Agency, (b) the accuracy of the burden estimate (time estimated 
to complete each collection of information request), (c) ways to 
minimize the burden estimates, and (d) ways to enhance the quality of 
the information being collected. Please send comments on the data 
collection requirements to David Rostker, Office of Management and 
Budget, Office of Information and Regulatory Affairs, 725 17th Street, 
NW, Washington, DC 20503, and to Jane Palsgrove Butler, Associate 
Administrator, Office of Financial Assistance, 409 3rd Street, SW, 
Washington, DC 20416.
    For purposes of Executive Order 13132, SBA has determined that this 
proposed rule has no federalism implications because the legislation 
authorizing it provides grants to private, non-profit organizations 
working directly with disadvantaged entrepreneurs.
    For purposes of Executive Order 12988, SBA certifies that this 
proposed rule is drafted, to the extent practicable, in accordance with 
the standards set forth in section 3 of that Order.

List of Subjects in 13 CFR Part 119

    Grant programs--business, Small business.
    For the reasons stated in the preamble, the Small Business 
Administration proposes to add 13 CFR part 119 as follows:

PART 119--PROGRAM FOR INVESTMENT IN MICROENTREPRENEURS (``PRIME'' 
OR ``THE ACT'')

Sec.
119.1   What is the Program for Investment in Microentreprenuers 
(``PRIME'' or ``the Act'')?
119.2   Definitions.
119.3   What types of organizations are eligible for PRIME grants?
119.4   What services or activities may PRIME grant funds be used 
for?
119.5   How are PRIME grant awards allocated?
119.6   What are the minimum and maximum amounts for an award?
119.7   How long will grant funding be available to a single 
grantee?
119.8   Are there matching requirements for grantees?
119.9   How will a qualified organization apply for PRIME grant 
awards?
119.10   Will SBA give preferential consideration to other SBA 
program participants?
119.11   What information will be requested in an application under 
the PRIME program?
119.12   What criteria will SBA use to evaluate applications for 
funding under the PRIME program?
119.13   How will an applicant make a subgrant?
119.14   Are there limitations regarding the use of program income?
119.15   If a grantee is unable to spend the entire amount allotted 
for a single fiscal year, can the funds be carried over to the next 
year?
119.16   What are the reporting, record keeping, and related 
requirements for grantees?
119.17   What types of oversight will SBA provide to grantees?
119.18   What are the restrictions against lobbying?
119.19   Is fundraising an allowable expense under the PRIME 
program?
119.20   Should grantees and subgrantees raise conflict of interest 
matters with SBA?

    Authority: 15 U.S.C. 634(b)(6) and Pub. L. 106-102.


Sec. 119.1  What is the Program for Investment in Microentrepreneurs 
(``PRIME'' or ``the Act'')?

    PRIME authorizes SBA to make grants to ``qualified organizations'' 
to fund training and technical assistance for disadvantaged 
entrepreneurs, build these organizations' own capacity to give training 
and technical assistance, fund research and development of ``best 
practices'' in microenterprise development and technical assistance 
programs for disadvantaged microentrepreneurs, and to fund other 
undertakings the Administrator or designee deems consistent with these 
purposes.


Sec. 119.2  Definitions. For the purposes of this part, the following 
definitions apply:

    Capacity Building Grant means a grant made under the Act identified 
under Sec. 119.4(b).
    Capacity building services means services provided to an 
organization or program that is currently, or is developing as, a 
microenterprise development organization or program, for the purpose of 
enhancing its ability to provide training and technical assistance to 
disadvantaged microentrepreneurs.
    Collaborative means two or more nonprofit entities that agree to 
act jointly as a qualified organization under this part.
    Developer means a person interested in starting or acquiring a 
microenterprise.

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    Disadvantaged entrepreneur, or disadvantaged microentrepreneur, 
means the owner, majority owner, or developer, of a microenterprise who 
is also--
    (1) A low-income person;
    (2) A very low-income person; or
    (3) An entrepreneur who lacks adequate access to capital or other 
resources essential for business success, or is economically 
disadvantaged, as defined in this part.
    Discretionary Grant means a grant made under the Act identified 
under Sec. 119.4(d).
    Economically disadvantaged entrepreneur, or economically 
disadvantaged microentrepreneur, means an owner, majority owner, or 
developer of a microenterprise whose ability to compete in the free 
enterprise system has been impaired due to diminished capital and 
credit opportunities as compared to others in the industry such that 
his or her ownership of a small business would help to qualify the 
small business for assistance under the section 7(j) or section 8(a) 
programs of the Small Business Act.
    Emerging microenterprise development organization or program means 
a microenterprise development organization or program which has a 
microenterprise capacity building services component, but has had such 
a component for less than 4 years at the date of its application for a 
PRIME grant.
    Grantee means a recipient of a grant under the Act.
    Group has the same meaning as ``collaborative'' as defined in this 
section.
    Indian tribe means any Indian tribe, band, pueblo, nation, or other 
organized group or community, including any Alaska Native village or 
regional or village corporation, as defined in or established pursuant 
to the Alaska Native Claims Settlement Act, which is recognized as 
eligible for the special programs and services the United States 
provides to Indians because of their status as Indians.
    Indian tribe jurisdiction means Indian country, as defined in 18 
U.S.C. 1151, and any other lands, title to which is either held by the 
United States in trust for the benefit of any Indian tribe or 
individual or held by any tribe or individual subject to a restriction 
by the United States against alienation, and any land held by Alaska 
Native groups, regional corporations, and village corporations, as 
defined in or established under the Alaska Native Claims Settlement 
Act, public domain Indian allotments, and former Indian reservations in 
the State of Oklahoma.
    Intermediary means a private, nonprofit entity serving or seeking 
to serve microenterprise development organizations or programs 
identified under Sec. 119.3.
    Large microenterprise development organization or program means a 
microenterprise development organization or program with 10 or more 
full time employees or equivalents, including its executive director, 
as of the date it files its application with SBA for a PRIME grant.
    Local community means an identifiable area and population 
constituting a political subdivision of a state.
    Low-income person means a person having an income, adjusted for 
family size, of not more than--
    (1) For metropolitan areas, 80 percent of the median income; and
    (2) For non-metropolitan areas, the greater of--
    (i) 80 percent of the area median income; or
    (ii) 80 percent of the statewide non-metropolitan area median 
income.
    Microenterprise means a sole proprietorship, partnership or 
corporation that--
    (1) Has fewer than 5 employees, including the owner; and
    (2) Generally lacks access to conventional loans, equity, or other 
banking services.
    Microenterprise development organization or program means a 
nonprofit entity, or a program administered by such an entity, 
including community development corporations or other nonprofit 
development organizations and social service organizations, that 
provides services to disadvantaged microentrepreneurs.
    Qualified organization means an organization eligible for a PRIME 
grant identified under Sec. 119.3.
    Research and Development Grant means a grant made under the Act 
identified under Sec. 119.4(c).
    Severe constraints on available sources of matching funds means the 
documented inability of a qualified organization applying for a PRIME 
grant to raise matching funds or in-kind resources from non-Federal 
sources during the 2 years immediately prior to the date of its 
application because of a lack of or increased scarcity of monetary or 
in-kind resources from potential non-Federal sources.
    Small microenterprise development organization or program means a 
microenterprise development organization or program with less than 10 
full time employees or equivalents, including its executive director, 
as of the date it files its application with SBA for a PRIME grant.
    Technical Assistance Grant means a grant made under the Act 
identified under Sec. 119.4(a).
    Training and technical assistance means services and support 
provided to disadvantaged entrepreneurs, such as assistance intended to 
enhance business planning, marketing, management, financial management 
skills, business operations, or assistance for the purpose of 
increasing access to loans and other financial services.
    Very low income person means having an income adjusted for family 
size of not more than 150 percent of the poverty line, as defined in 
section 673(2) of the Community Services Block Grant Act, 42 U.S.C. 
9902(2), including any revision required by that section.


Sec. 119.3  What types of organizations are eligible for PRIME grants?

    An organization eligible for a PRIME grant (``qualified 
organization'') is one that is:
    (a) A microenterprise development organization or program as 
defined in Sec. 119.2 (or a group or collaborative thereof) that has a 
demonstrated record of delivering microenterprise services to 
disadvantaged microentrepreneurs;
    (b) An intermediary, as defined in Sec. 119.2;
    (c) A microenterprise development organization or program as 
defined in Sec. 119.2 that is accountable to a local community, working 
with a State or local government or Indian tribe; or
    (d) An Indian tribe acting on its own, if the Indian tribe can 
certify that no private organization or program referred to in 
paragraphs (a), (b) and (c) of this section exists within its 
jurisdiction.


Sec. 119.4  What services or activities may PRIME grant funds be used 
for?

    A recipient of a PRIME grant (``grantee'') must use PRIME grants 
to--
    (a) Provide training and technical assistance to disadvantaged 
microentrepreneurs (``Technical Assistance Grant'');
    (b) Provide training and capacity building services to 
microenterprise development organizations and programs to assist them 
to develop microenterprise training and services (``Capacity Building 
Grant'');
    (c) Aid in researching and developing the best practices in the 
field of microenterprise development and technical assistance programs 
for disadvantaged microentrepreneurs (``Research and Development 
Grant''); or
    (d) Conduct such other activities as the Administrator or designee 
determines to be consistent with the

[[Page 60261]]

purposes of the Act (``Discretionary Grant'').


Sec. 119.5  How are PRIME grant awards allocated?

    (a) Not less than 50 percent of the number of grant awards made 
under this part will be awarded to qualified organizations benefiting 
very low-income persons, including those residing on Indian 
reservations. In general, SBA will make grant award decisions to serve 
diverse populations by including as recipients both large and small 
microenterprise development organizations, and organizations serving 
urban, rural, and Indian tribal communities.
    (b) SBA will allocate the funding available for awards as follows:
    (1) A minimum of 75 percent for Technical Assistance Grants;
    (2) A minimum of 15 percent for Capacity Building Grants; and
    (3) The remaining 10 percent or less may be allocated by SBA, in 
its sole discretion to be used for:
    (i) Research and Development Grants; or
    (ii) Discretionary Grants.


Sec. 119.6  What are the minimum and maximum amounts for an award?

    (a) The minimum grant award for Technical Assistance and Capacity 
Building Grants will be $50,000, subject to the availability of funds.
    (b) There is no minimum grant award for Research and Development or 
Discretionary Grants.
    (c) The maximum amount that an individual grant recipient may 
receive in any fiscal year from a single award or multiple awards, 
under any of the purposes of the program, may not exceed $250,000 or 10 
percent of the total grant funds available for award in that fiscal 
year, whichever is less.


Sec. 119.7  How long will grant funding be available to a single 
grantee?

    (a) Subject to the availability of funds and continuing 
authorization of the PRIME program, funding will be available on an 
annual basis allowing for the initial grant plus up to 4 option years, 
for a total of 5 years. Continuation of funding during option years 
will depend upon funding limitations, the grantee's performance, 
continued legislative authorization, and otherwise at the discretion of 
SBA. A grantee may apply for funding for less than the 5-year time 
frame available.
    (b) After a grantee receives an initial grant, funding for any 
option years will be in declining amounts as follows:
    (1) 80 percent of initial grant amount in first option year;
    (2) 60 percent of initial grant amount in second option year;
    (3) 40 percent of initial grant amount in third option year; and
    (4) 20 percent of initial grant amount in fourth option year.


Sec. 119.8  Are there matching requirements for grantees?

    Applicants and grantees must match SBA funding as follows:
    (a) Except as provided in paragraph (c) of this section, applicants 
and grantees must match Federal assistance with funds from sources 
other than the Federal Government in an amount not less than 50 percent 
of the grant amount awarded each year. Sources such as fees, grants, 
gifts, income from loan sources, and in-kind resources of a grant 
recipient from non-Federal public or private sources may be used to 
comply with the matching funds requirement;
    (b) Grantees receiving funds in option years as described in 
Sec. 119.7(b) are subject to matching requirements of this section.
    (c) For an applicant or grantee with severe constraints on 
available sources of matching funds, the Administrator or designee may 
reduce or eliminate the matching requirements. Any reductions or 
eliminations must not exceed 10 percent of the aggregate of all PRIME 
grant funds made available by SBA in any fiscal year.
    (d) An applicant may request a waiver of the matching fund 
requirement by submitting a written request with its application for 
funding. The request must justify the need for a waiver indicating:
    (1) The cause and extent of the constraints on the historical and 
projected ability to raise matching funds;
    (2) Fund raising efforts up to the time the application is 
submitted;
    (3) Based on those efforts, a list of any matching funds expected 
for the PRIME grant; and
    (4) The extent to which, without the waiver, services under the 
PRIME program will be unavailable to an area with a demonstrated 
concentration of microenterprises.


Sec. 119.9  How will a qualified organization apply for PRIME grant 
awards?

    (a) SBA will issue Program Announcements specifying the terms, 
conditions, and evaluation criteria for each potential set of awards. 
Program Announcements will summarize the purpose of the available 
funds; will advise potential applicants regarding how to obtain an 
application packet; and will provide summary information regarding 
deadlines and other requirements. Program Announcements may specify any 
limitations, special rules, procedures, and restrictions for available 
funding.
    (b) Applicants may submit applications in response to the Program 
Announcements. Each applicant shall submit an application for a grant 
in accordance with this part and the applicable Program Announcement.
    (c) SBA reserves the right to consider at the same time multiple 
applications from a single applicant when appropriate.


Sec. 119.10  Will SBA give preferential consideration to other SBA 
program participants?

    In making grants under this part, SBA will not give preferential 
consideration to an applicant that is a participant in the program 
established under section 7(m) of the Small Business Act.


Sec. 119.11  What information will be requested in an application under 
the PRIME program?

    Each application must contain the information and documentation 
specified in the applicable Program Announcement including, but not 
limited to, the following items.
    (a) For applications seeking Technical Assistance Grants:
    (1) Identifying information and core documentation for the 
applicant including such items as the applicant's articles of 
incorporation, by-laws, proof of IRS tax-exempt status, financial 
statements, and reference contacts.
    (2) A description of past and present activities and technical 
qualifications of the applicant, including workshops, programs and 
other technical assistance services, with specific descriptions of the 
extent to which such services have reached low and very low-income 
individuals, and the success rates of clients.
    (3) A list of applicant's community partnerships and collaborations 
with state and local entities, and a description of how such 
partnerships and collaborations are serving microentrepreneurs.
    (4) A description of the proposed activity for which the applicant 
will use PRIME grant funds, including training programming plans; a 
plan for outreach and delivery; applicant's capacity to provide 
thorough and detailed reports; and a description of the applicant's 
current data collection and management system, such as computer 
hardware, software and internet capabilities.
    (5) In the event the applicant is a collaborative, a plan for 
maintaining internal controls, accountability, and program quality 
control among the participants of the collaborative.

[[Page 60262]]

    (6) Resumes of the personnel that will be administering and 
managing the proposed activities under the PRIME grant, showing 
knowledge in such areas as business development, business structures, 
financial management, and business training and counseling.
    (7) A list of grants received, and/or contracts entered into, that 
are similar in scope to the subject grant, including name of Federal or 
other agency providing funding, grant or contract number, and a summary 
of services provided.
    (b) For applicants seeking Capacity Building Grants:
    (1) See paragraphs (a) (1) , (5) , (6) and (7) of this section.
    (2) A description of past and present activities and technical 
qualifications of the applicant, including workshops, programs, 
operational services, and other technical assistance services, or 
program development services with specific descriptions of the extent 
to which such services have improved the operations of client MDOs, 
assisted client MDOs with operational issues, and assisted client MDOs 
in reaching low and very low-income individuals.
    (3) A description of the proposed activity for which the applicant 
will use PRIME grant funds, including training programming plans, a 
plan for outreach and delivery, applicant's capacity to provide 
thorough and detailed reports; a description of the applicant's current 
data collection and management system, such as computer hardware, 
software, and internet capabilities and a description of how these 
capabilities will or will not be integrated into the training of MDOs.
    (c) For applicants seeking Research and Development Grants:
    (1) See paragraphs (a)(1), (6), and (7) of this section.
    (2) A research proposal indicating the thesis, method(s), scope, 
duration, and implementation plans (if any).
    (3) A description of the expected effect of the research on 
services to disadvantaged microentrepreneurs.
    (d) For applicants seeking Discretionary Grant:
    (1) See paragraph(a)(1) of this section.
    (2) A description of the proposed activity for which the applicant 
will use PRIME grant funds, including applicant's capacity to provide 
thorough and detailed reports, and a description of the applicant's 
current data collection and management system, such as computer 
hardware, software and internet capabilities.


Sec. 119.12  What criteria will SBA use to evaluate applications for 
funding under the PRIME program?

    During the first year for which funding is available for the PRIME 
program, SBA will give special consideration to organizations located 
in and serving areas of, or with a history of successful outreach to, 
low-income and very low-income persons, to enable the Prime program to 
assist those with the greatest need first. SBA will evaluate 
applications for funding in accordance with the specific goals of the 
Act, and as more fully described in the Program Announcements. 
Evaluation criteria include, but are not limited to, the following:
    (a) Applications for Technical Assistance Grants:
    (1) Applicants will compete within two levels of expertise:
    (i) The start-up level, for those that have been in operation as a 
microenterprise development organization for 4 years or less; and
    (ii) The experienced level, for those that have been in operation 
for more than 4 years.
    (2) SBA will evaluate organizational structure, financial 
stability, financial management systems, personnel capacity, and 
electronic communication capabilities (or potential for same). SBA will 
also evaluate data collection capabilities, reporting capacities, and 
ability to account for performance and outcome.
    (3) SBA will evaluate the applicant's history of providing 
technical assistance to low-income and very low-income 
microentrepreneurs. This factor includes patterns of program growth, 
client success, outcomes of training, success in establishing new 
businesses, and success in arranging micro-level financing when the 
client indicates financing as a goal.
    (4) SBA will evaluate the applicant's ability to use community 
partnerships and collaborations with state and local entities to better 
serve low-income and very low-income microentrepreneurs.
    (b) Applications for Capacity Building Grants:
    (1) SBA will evaluate the criteria set forth in paragraph (a)(2) of 
this section.
    (2) SBA will evaluate the applicant's history of providing capacity 
building services to MDOs, as an indication of the organization's 
understanding of the goals and purposes of capacity building, its 
historical effectiveness with the microenterprise development industry, 
and its ability to provide quality programming to the targeted market. 
SBA will evaluate patterns of program growth, outcomes of training, 
types of services provided, delivery systems used, the number and types 
of clients served, and the successes realized within the client's 
organizational goals.
    (3) SBA will evaluate expected impact on client MDOs; expected 
impact on services to low-and very-low income microentrepreneurs; and a 
plan for service and delivery.
    (c) Applications for Research and Development Grants:
    (1) SBA will evaluate the criteria set forth in paragraph (a)(2) of 
this section.
    (2) SBA will evaluate how the research potentially will enhance 
microenterprise-oriented technical assistance services to disadvantaged 
entrepreneurs. Applicants must show the method(s), scope, duration, and 
implementation plans of the proposed research.
    (3) SBA will evaluate applicant's plan of action incorporating 
original and secondary research. Applicants must show impact on 
improved access to microenterprise development services for 
disadvantaged microentrepreneurs, and the expected replicability/
transferability of the finished product to the field.
    (d) Applications for Discretionary Grants will be evaluated in 
accordance with the requirements of each project.


Sec. 119.13  How will an applicant make a subgrant?

    (a) An applicant that wants to make subgrants using PRIME grant 
funds must receive written approval from SBA prior to making subgrants. 
The applicant must identify the subgrantee(s) and describe in detail 
what the subgrantee(s) will do to help the grantee implement its 
proposal. An applicant must submit information to SBA demonstrating 
that, through the subgrantee(s), the grantee's program will:
    (1) Provide expanded services to the community,
    (2) Provide a method by which one or more previously unserved 
communities will gain access to the program, or
    (3) Provide other specific benefits to the clients, such as 
specialized training, expanded schedules of operation, or other 
benefits.
    (b) If an applicant has identified potential subgrantee(s) at the 
time it submits an application for a PRIME grant, the applicant must 
include the information requested in paragraph (a) of this section in 
the application. Otherwise, the applicant or grantee may submit the 
requested information at such time that approvals for subgrantee(s) are 
requested.
    (c) A grantee may not use more than 7.5 percent of the assistance 
received under its PRIME grant for administrative expenses in 
connection with the making of subgrants.

[[Page 60263]]

Sec. 119.14  Are there limitations regarding the use of program income?

    Program income, as defined in OMB Circular A-110, may only be used 
to further PRIME program objectives. As such, fees collected from 
clients, and other program income as defined, may be used to help fund 
the matching requirement. All program income, as defined, shall be 
reported on financial reports submitted to SBA and added to funds 
committed to the project by SBA and the recipient organization. 
However, any interest earned in excess of the maximum allowable amount 
as specified in the OMB circular incorporated into the grant must be 
returned to the Federal Government by the grantee.


Sec. 119.15  If a grantee is unable to spend the entire amount allotted 
for a single fiscal year, can the funds be carried over to the next 
year?

    (a) The grantee may request approval to use unexpended funds in the 
next budget period. This is permissible if funds are to be used for a 
non-severable, non-recurring project or activity within the scope of 
the PRIME program. Non-severable means a project in its entirety that 
cannot be subdivided. The request for using unexpended funds in the 
next budget period must include the following:
    (1) SF 424, budget pages, and justification;
    (2) Explanation of why the funds were not expended during the 
period in which they were awarded; and
    (3) Evidence of match. The match requirement for funds carried over 
to the next budget period can be met by using any excess of matching 
funds from the current budget period, new matching funds, or a 
combination of both.
    (b) The request must be made no later than 60 days before the end 
of the budget/project period or the de-obligation process will begin. 
Approved requests will require the issuance of a revised Notice of 
Award. Expenditures for funds carried over to the next budget period 
must be tracked separately.


Sec. 119.16  What are the reporting, record keeping, and related 
requirements for grantees?

    A grantee must keep records and meet the other requirements of 
section 115 of the Riegle Community Development and Regulatory 
Improvement Act of 1994 (Riegle Act), as if it were a community 
development financial institution. (See 12 U.S.C. 4714). In addition to 
meeting requirements of the Riegle Act, a grantee must also maintain 
data allowing it to measure the impact of services provided by it and 
any subgrantees, and, if specifically required by the terms of the 
PRIME grant, measure the success rate of individual clients whom the 
grantees assist. SBA will detail such requirements in its Program 
Announcements.


Sec. 119.17  What types of oversight will SBA provide to grantees?

    (a) In addition to reports required under the Riegle Act, SBA will 
require reports in accordance with applicable OMB circulars. Such 
reports will include the following information:
    (1) For recipients of Technical Assistance and Capacity Building 
Grants, for the first three years of receiving grant funding, narrative 
performance reports and financial status reports will be required 
quarterly within 15 calendar days of the end of each quarter. 
Thereafter, SBA may reduce the frequency of reports from quarterly to 
semi-annually, as it deems appropriate. In addition, details of 
expenditures will be required with each request for payment. Grantees 
will be required to submit audited financial statements on an annual 
basis, if available, or annual financial statements prepared by a 
licensed, independent public accountant, within 120 calendar days of 
the end of the grantee's fiscal year.
    (2) For recipients of Research and Development Grants, reports will 
be required in accordance with agreed upon milestones and as part of 
the disbursement process.
    (3) For recipients of Discretionary Grants, reports will be 
required as appropriate for the project, or on a schedule as described 
in paragraph(a)(1) of this section, whichever is more frequent.
    (b) In addition, SBA may, from time to time, make site visits to 
the grantee, and review all applicable books and records.


Sec. 119.18  What are the restrictions against lobbying?

    No assistance made available under the PRIME program may be 
expended by a grantee or subgrantee to pay any person to influence, or 
attempt to influence, any agency, elected official, officer, or 
employee of a Federal, State, or local government in connection its 
participation in the program.


Sec. 119.19  Is fundraising an allowable expense under the PRIME 
program?

    Expenditures of grant funds for fundraising activities are not 
allowable costs under this program. Applicants must be able to raise 
matching funds without the assistance of grant funds. Unless the full 
requirement for matching funds is waived, the applicant must 
demonstrate that it has adequate fundraising resources to obtain 
required non-Federal matching funds to perform the project.


Sec. 119.20  Should grantees and subgrantees raise conflict of interest 
matters with SBA?

    Each grantee or subgrantee must provide SBA with a copy of its 
conflicts of interest policies prior to receipt of funding under the 
program. Such policies must clearly describe the grantee's or 
subgrantee's protections from conflicts of interest or the appearance 
thereof in the handling of grant funding and program provision under 
this program.

    Dated: September 25, 2000.
Aida Alvarez,
Administrator.

    Note: The following appendix will not appear in the Code of 
Federal Regulations.

Program for Investment in Microentrepreneurs

DATE:
TO: Applicants
FROM: Office of Procurement and Grants Management (OPGM)
SUBJECT: Program Announcement No. PRIME 01-1, Program for Investment in 
Microenterprise Act, (``PRIME'') to provide disadvantaged 
microentrepreneurs training and technical assistance to start, operate, 
or expand their businesses.
    The U.S. Small Business Administration plans to issue Federal 
grants awards to qualified organizations under PRIME to provide 
training and technical assistance to disadvantaged microentrepreneurs. 
These organizations include: non-profit microenterprise development 
organizations or programs; intermediaries (as defined); other 
microenterprise development organizations or programs (as defined) that 
are accountable to a local community, working in conjunction with a 
State or local government or Indian tribe; or Indian tribes acting on 
their own, with proper certification that no other qualified 
organization exists within their jurisdiction. You are invited to 
submit an application, an original and two (2) copies, in response to 
Program Announcement No. PRIME 01-1. You are required to bind the cost 
proposal and technical proposal separately. Prepare the technical and 
cost proposals in single-spaced 12-pt. font format. The technical 
proposal must not exceed 50 pages, excluding exhibits and appendices. 
The Government will not return proposals, but will retain them for a 
limited period of time.

[[Page 60264]]

    The closing date for the program announcement is ________ , 4:00 
P.M., Eastern Standard Time. Address your applications/proposal to the 
U.S. Small Business Administration, Office of Procurement & Grants 
Management (OPGM), 409 3rd Street, SW, 5th Floor, Washington, DC 20416, 
Attention: Mina Bookhard, Agreement Officer. If hand carried, deliver 
the application/proposal to Mina Bookhard, or her designee, at the 
above address. Deliveries to other locations will be considered late if 
not received in OPGM at the U.S. Small Business Administration by 4:00 
p.m. on ________ . Please place the following notation in the lower 
left corner of the sealed envelope or package:
    THIS IS A SEALED OFFER. DO NOT OPEN. STAMP THE DATE AND TIME 
RECEIVED ON THE ENVELOPE. THE ENCLOSED APPLICATION IS IN RESPONSE TO 
PROGRAM ANNOUNCEMENT NUMBER PRIME 01-1, DUE ________ AT 4:00 P.M., 
Eastern Standard Time, AT SBA's OFFICE OF PROCUREMENT & GRANTS 
MANAGEMENT.
    Applicants will be required to meet the standards for financial 
management systems as prescribed in the Office of Management and 
Budget's (OMB) Circular A-110, Subpart C, sections .21 through .28, and 
13 CFR Part 143.
    Questions concerning this program announcement should be directed 
to Warren Boyd at (202) 205-7534. Questions about budget or funding 
matters should be directed to Mina Bookhard, at (202) 205-7080.
Sincerely,
Sharon Gurley, Director, Office of Procurement and Grants 
Management.
OFFICE OF FINANCIAL ASSISTANCE
PROGRAM ANNOUNCEMENT

PROGRAM FOR INVESTMENT IN MICROENTREPRENEURS ACT, (``PRIME'')

TO PROVIDE TRAINING AND TECHNICAL ASSISTANCE TO DISADVANTAGED 
ENTREPRENEURS

FISCAL YEAR 2001

U.S. SMALL BUSINESS ADMINISTRATION OFFICE OF FINANCIAL ASSISTANCE
OPENING DATE:----------------------------------------------------------

CLOSING DATE:----------------------------------------------------------

ANNOUNCEMENT NO: PRIME 01-1--------------------------------------------

TABLE OF CONTENTS

I. LEGISLATION PURPOSE
II. INTRODUCTION
III. PROGRAM OVERVIEW
IV. ELIGIBLE APPLICANTS FOR THIS GRANT
V. INELIGIBLE APPLICANTS FOR THIS GRANT
VI. GENERAL INFORMATION
VII. OMB UNIFORM ADMINISTRATIVE REQUIREMENTS AND COST PRINCIPLES
VIII. PROPOSAL INSTRUCTIONS AND EVALUATION CRITERIA
IX. OPTION YEAR FUNDING
X. PREPARING YOUR BUDGET
XI. ASSEMBLY AND MAILING INSTRUCTIONS
XII. LATE SUBMISSIONS, REVISIONS, WITHDRAWALS
XIII. UNSUCCESSFUL APPLICANTS
XIV. CANCELLATION
XV. GLOSSARY OF TERMS
XVI. PAPERWORK REDUCTION ACT
XVII. PRIVACY ACT
APPENDIX A: APPLICATION FOR FEDERAL ASSISTANCE
APPENDIX B: ASSURANCES AND CERTIFICATIONS
APPENDIX C: MILESTONE CHARTS

I. Legislation Purpose

    The Program for Investment in Microentrepreneurs Act of 1999 (P.L. 
106-102) became law on November 12, 1999. 15 U.S.C. 6901 et seq. 
(``PRIME'' or ``the Act). The Act authorizes the Administrator of the 
U.S. Small Business Administration (SBA) to establish a microenterprise 
training and technical assistance program for disadvantaged 
microentrepreneurs and to provide training and capacity building grant 
program to microenterprise development organizations (MDOs). 
Additionally, the Act authorizes research and development of best 
practices for microenterprise development and technical assistance 
programs for disadvantaged entrepreneurs and other activities as the 
Administrator of SBA determines are consistent with the Act. PRIME has 
several purposes for which SBA will issue separate program 
announcements soliciting applications geared toward a particular 
legislative purpose. Program Announcements called for under the Act 
solicit, from eligible organizations, applications for grant funding to 
be used to carry out the purposes of the Act as follows:
    Program Announcement No. PRIME 01-1 calls for applications from 
qualified organizations wishing to obtain grant funding for the purpose 
of providing training and technical assistance programs for 
disadvantaged microentrepreneurs.
    Program Announcement No. PRIME 01-2 calls for applications from 
qualified organizations wishing to obtain grant funding for the purpose 
of providing training and capacity building services to microenterprise 
development organizations and programs and groups of such organizations 
to assist them in developing microenterprise training and services.
    Program Announcement No. PRIME 01-3 calls for applications from 
qualified organizations wishing to obtain grant funding for the purpose 
of pursuing research and developing best practices in the field of 
microenterprise and technical assistance programs for disadvantaged 
entrepreneurs.
    The purpose of this Program Announcement No. PRIME-01-1, is to 
solicit applications from qualified organizations wishing to obtain 
grant funding for the purpose of providing training and technical 
assistance programs for disadvantaged microentrepreneurs. These PRIME 
grants will enable MDOs to offer disadvantaged microentrepreneurs 
training and technical assistance that will make a difference in their 
ability to start, grow, and sustain microenterprises in economically 
distressed, high unemployment areas. Seventy-five (75) percent of 
available PRIME funds will be used for training and direct technical 
assistance to disadvantaged microentrepreneurs and of the funds 
allocated for training & technical assistance, 50% will be used to 
benefit very lows income persons. Subject to the availability of funds, 
grants awarded under this Program Announcement will be for a minimum of 
$50,000 with no one grant exceeding $250,000 or 10% of the total amount 
appropriated, whichever is less.

II. Introduction

    Congress recognized that many disadvantaged microentrepreneurs lack 
sufficient training and education to gain access to capital to 
establish and expand their own small businesses. It enacted PRIME to 
augment training and technical assistance under the Small Business Act 
and other legislation. PRIME grants to qualified MDOs will help meet 
more training and technical assistance needs for disadvantaged 
microentrepreneurs, thereby encouraging entrepreneurship and community 
development.
    Many low income and very-low income entrepreneurs need training and 
technical assistance to start, operate, or expand their businesses. In 
order to achieve measurable success in the effort, the providers of 
this training and technical assistance, (MDOs) must be accessible, 
competent, consistent and committed to the entrepreneur's progress over 
extended periods of time.
    For every business started or microloan made, a number of 
entrepreneurs are preparing themselves for business start. A generally 
accepted assumption in the microenterprise

[[Page 60265]]

industry is that it takes approximately 10 potential microentrepreneurs 
for every microenterprise started or microloan booked. The cost of 
training is substantial because those at the entry-level stage of 
development typically require the greatest amount of dedicated advice 
and guidance, over an extended period of time, to achieve the highest 
rates of success. Funding is scarce relative to the need. The 
microenterprise industry has found the technical assistance-funding gap 
to be a nationwide condition, particularly in the very low-income 
sector.
    This Program Announcement addresses funding for training and 
technical assistance for disadvantaged entrepreneurs, as defined, in 
the entry-level stages of development. The program requires that 
grantees match a portion of the SBA's funds with funds from other 
sources.

III. Program Overview

    1. Project Name: Program for Investment in Microentrepreneurs 
(PRIME).
    2. Purpose: Provide training and technical assistance to 
disadvantaged microentrepreneurs for the purpose of enhancing business 
planning, marketing, management, financial management skills, and 
assistance for the purpose of accessing financial services.
    3. Federal Catalog Number: 59.049.
    4. Authority: The Program for Investment in Microentrepreneurs Act 
of 1999, ``PRIME'', P.L.106-102, 15 U.S.C. 6901 et seq.
    5. Funding Instrument: Grant.
    6. Funding: Funding is subject to the availability of funds and the 
requirements enumerated under the Act.
    7. Funding Range: Target award amounts will be a minimum of 
$50,000. Award amounts may vary, depending upon availability of funds 
(and performance for option years); however, no single person may 
receive more than $250,000 or ten (10) percent of the total funds made 
available for this program in a single fiscal year, whichever is less. 
In general, match is required, although SBA may reduce or eliminate the 
required match in certain circumstances (up to a program limit of 10 
percent).
    8. Number of Awards: SBA anticipates issuing multiple awards under 
this Announcement. The number may vary, based on the needs of the pool 
of qualified applicants received and the amount of available funds. At 
least 75% of all funds available under the Act must be awarded under 
this Program Announcement.
    9. Targeted assistance: A minimum of 50% of the funds available for 
grants under the PRIME Act must be used to benefit very low income 
persons (as defined in this document), including those residing on 
Indian reservations.
    10. Closing Time and Date for the Submission of Applications: 
______ at 4:00 P.M. Eastern Daylight Time.
    11. Project Starting Date: ______ (estimated).
    12. Project Duration: The period performance for this grant is one 
base year with 4 twelve-month options subject to availability of funds 
and continued program authorization. The total possible period of 
performance is five years. Each option year will constitute a separate 
budget period. The project recipient's satisfactory performance will be 
one of the key factors in determining the award of an option year. 
Failure to secure the required annual non-Federal contribution during 
any project year may jeopardize continued option year funding.
    13. Proposal Evaluation: Applications will first be screened to 
determine if the applicant meets certain mandatory eligibility 
requirements. Applicants that do not document in their application that 
they meet these requirements will not be evaluated by SBA for 
participation in the Prime Program. In addition, applications that are 
incomplete, illegible, or unreadable, in whole or in part, will be 
deemed incomplete and will not be evaluated.
    Eligible proposals will be scored by an Objective Review Committee 
(ORC) based on evaluation criteria stated in this program announcement. 
The ORC will consist of SBA officials and may include Federal Officials 
from other agencies. Microenterprise Development Branch staff will 
review the ORC evaluations, the ORC's summary report on each applicant, 
and the applicant's proposals to determine the final scoring of award 
recipients. SBA may ask applicants for clarification on the technical 
and cost aspects of the proposals. Such clarifications must not be 
construed as a commitment to fund the proposed effort.
    14. Points of Contact: Questions concerning the technical aspects 
of this Program Announcement should be directed to the Microenterprise 
Development Branch at (202) 205-7534. However, due to the competitive 
process, SBA will be unable to assist with answers to specific 
questions regarding individual proposals or requests for assistance in 
completing proposals. Questions concerning budgeting or funding for 
this grant should be directed to Mina Bookhard at (202) 205-6621.
    15. Award Notification: All applicants will receive a written 
notification relative to selection of award recipients. This written 
notice will be SBA's final response to this program announcement. SBA 
will not provide debriefing sessions if your proposal was not 
successful.
    16. Cancellation: SBA reserves the right to cancel this Program 
Announcement in whole or in part at the Agency's discretion.

IV. Eligible Applicants for This Grant

    An organization will be considered eligible for funding for the 
purpose of providing training and technical assistance to disadvantaged 
microentrepreneurs if it meets the following qualification 
requirements:
    1. A microenterprise development organization or program (or group 
or collaborative thereof) that has a demonstrated record of delivering 
microenterprise services to disadvantaged entrepreneurs, OR
    2. An intermediary (as defined in this document) which has 
experience in delivering technical assistance to disadvantaged 
entrepreneurs, OR
    3. A microenterprise development organization or program (as 
defined in this document) that is accountable to a local community, 
working in conjunction with a State or local government or Indian 
tribe, OR
    4. An Indian tribe acting on its own, if the Indian tribe can 
certify that no private organization or program referred to in this 
paragraph exists within its jurisdiction.
    An eligible applicant for the Prime technical assistance grant must 
provide documentation in its application that it falls within one of 
the above categories of qualified organizations. Such documentation 
should include but is not limited to:
    1. A copy of your organization's IRS tax-exempt certificate 
including the IRS code under which your organization is considered non-
profit;
    2. Certification by your Secretary of State that your organization 
is legally allowed to do business in the State and a copy of your 
organization's articles of incorporation and by-laws;
    3. For category 4 in the preceding paragraph, written certification 
from a duly authorized person that no other qualified organization 
(i.e. private organization or program as defined in categories 1-3 
above) exists within its jurisdiction; and
    4. Financial statements for the past 3 years. If your organization 
has been in business for less than 3 years provide your year end 
financial statements for

[[Page 60266]]

those years completed and a financial statement not less than 90 days 
old.
    SBA will not evaluate applications that do not meet these 
requirements. SBA may not screen applicants for eligibility until after 
the Closing Date for application acceptance. SBA will attempt to notify 
applicants of ineligible proposals as soon as practicable. However, SBA 
is under no obligation to notify ineligible applicants before the 
Closing Date for the acceptance of applications under this Program 
Announcement. SBA strongly urges all applicants to ensure all 
eligibility requirements are met and documented before sending an 
application to SBA.

V. Ineligible Applicants for This Grant

    The following applicants will automatically be considered 
ineligible and their applications will not be evaluated:
    1. Any organization with an unresolved audit by any Federal agency.
    2. Any organization suspended or debarred from any Federal agency 
or is otherwise excluded from Federal non-procurement or procurement 
programs.
    3. Any organization which has defaulted on an obligation to the 
United States.

VI. General Information

1. Definitions

    Throughout this Program Announcement specific terminology may be 
used, as defined in the Act and the accompanying rule (13 CFR part 119) 
published on ____. The definitions are contained in a glossary of terms 
located at the end of this document in Section XV.

2. Collaborative Applications

    a. If you participate in a collaborative (as defined in this 
document), all entities who are party to the collaborative must 
separately meet the statutory requirements and eligibility requirements 
in order to apply as a collaborative.
    b. Applications from collaboratives must name the primary liaison 
with the Federal government, and include a copy of the collaborative 
agreement outlining responsibilities of each partner organization. An 
authorized signature from each organization must appear on the 
agreement. The primary liaison will be responsible for coordinating 
reports and requests for funding.

3. Program Income

    All program income as defined in OMB Circular A-110, and OMB A-122 
shall be reported on financial reports submitted to SBA and added to 
funds committed to the project by SBA and recipient organizations. 
Program income may only be used to further eligible program objectives.

4. Cost Principles

    a. General: All costs approved for a successful applicant must meet 
the tests of necessity, reasonableness, allowability and allocability 
in accordance with the cost principles applicable to this award. All 
proposed costs are subject to pre-award audit. Grantees are responsible 
to ensure proper management and financial accountability of Federal 
funds to preclude future cost disallowances. Payment will be made by 
reimbursement or advance payments as described in the grant award 
document and applicable OMB Circulars.
    b. Carryover Policy: The grantee may request approval to use 
unexpended funds in the next budget period. This is permissible if 
funds are to be used for a non-severable, non-recurring project or 
activity within the scope of the PRIME program. Non-severable means a 
project in its entirety that cannot be subdivided. The request for 
using unexpended funds in the next budget period must include the 
following:
    (1) SF 424, budget pages, and justification;
    (2) Explanation of why the funds were not expended during the 
period in which they were awarded; and
    (3) Evidence of match. The match requirement for funds carried over 
to the next budget period can be met by using any excess of matching 
funds from the current budget period, new matching funds, or a 
combination of both.
    The request must be made no later than 60 days before the end of 
the budget/project period or the de-obligation process will begin. 
Approved requests will require the issuance of a revised Notice of 
Award. Expenditures for funds carried over to the next budget period 
must be tracked separately.

5. Publications/Websites

    Any publications or websites developed under this grant must be 
submitted to SBA for prior review and approval. SBA will have an 
unlimited license to use data and written materials generated under 
this grant award, whether or not the materials are copyrighted. Any 
publications resulting from this project must include the following 
acknowledgement of support, whether copyrighted or not, in legible, 
easily readable print:

    This grant is partially funded by the U.S. Small Business 
Administration. SBA's funding is not an endorsement of any products, 
opinions, or services. All SBA funded programs are extended to the 
public on a nondiscriminatory basis.

    The grant recipient may not use the U.S. Small Business 
Administration name or logo for the endorsement of any services, 
products, or merchandise under this award.
    The SBA logo may appear on prominent webpages of Internet sites 
that are related to this project, but must appear with the above 
disclaimer in legible, easily readable print and acknowledgement of 
support in close physical proximity (within 2 inches) next to it.

6. Reports

a. General Reporting
    The selected grantees will be required to submit the reports as 
outlined below. Participants must agree to cooperate with SBA in the 
collection and retention of data required by this agency. Your ability 
to meet reporting requirements must be addressed in the Technical 
Proposal.
    Payments may be withheld if reports are not submitted within the 
required time frame or if the quality of reports is considered 
inadequate.
b. Performance Reports
    Quarterly performance reports, unless otherwise specified, must 
contain a summary of activity for the reporting period using the 
following format:
    1. A comparison of actual accomplishments to the estimated 
milestones established in the proposal and/or subsequent grant 
agreement.
    2. A discussion of accomplished milestones and reasons for slippage 
in those cases where milestones are not met. Where milestones were not 
met, a plan of action must be provided to overcome these slippages or a 
detailed statement of how the program will better serve disadvantaged 
entrepreneurs if the milestones are revised.
    3. Evidence that at least 50% of funding expended during the 
reporting period was expended for the benefit of very-low income 
clients.
    4. Information relating to actual financial expenditures of 
budgeted cost categories versus the estimated budget award, including 
an explanation of all cost overruns, if any, by budgeted cost category. 
Financial data furnished in this report is from a manager's standpoint 
and is in addition to that furnished in the financial reports cited 
below.
    5. Client Progress Reports. SBA is interested in the actual outcome 
of technical assistance provided to disadvantaged entrepreneurs. As 
such,

[[Page 60267]]

participants will be required to compile, maintain, and submit data as 
part of its quarterly performance reports. This report includes 
information regarding each client as follows:
    A. At Intake:
     Income level (low-income, very-low income, other)
     Geographic location (Address, Urban, Suburban, Rural)
     Goal of training (business start, business enhancement, 
professional improvement, self-employment, other)
     Business status (is it a start-up or existing business)
     Financing goal (if any)
    Intake reports should be compiled and maintained by the MDO within 
seven business days of initial intake under this grant.
    B. At Client Follow-up:
     Income level
     Geographic location
     Training status in terms of intake goals
     Business status
     Financing status in terms of intake goals
    Follow up data should be collected on all clients meeting the Six, 
Twelve, and Eighteen-Month receipt of technical assistance with the 
grantee. Follow-up reports should be submitted with quarterly 
performance reports.
    6. Any other pertinent information, including any significant 
accomplishments or met milestones of special significance. The report 
should include items which may be determined appropriate by SBA after 
acceptance of the grant proposal but which cannot be pre-determined due 
to the undetermined special purpose of the grant at the writing of this 
document.
     Quarterly reports will be due no later than:
    (a) January 15 for the period ending December 31,
    (b) April 15 for the period ending March 31,
    (c) July 15 for the period ending June 30, and
    (d) October 15 for the period ending September 30.
c. Financial Reports
    1. Financial Status Report Forms must be submitted every quarter 
with the performance reports. Reports must include Standard Form 
(``SF'') 269, the Financial Status Report, and SF 272, the Federal Cash 
Transactions Report.
    2. The year-end report must include a cost breakdown of actual 
expenditures and costs incurred by line item. Participants will also be 
required to submit the SF 2069, Detailed Actual Expenditures for Period 
Covered by Request, with the final SF 269.
    3. In addition, grantees will be required to submit audited annual 
financial statements, if available, or annual financial statements 
prepared by a licensed, independent public accountant, within 120 days 
of the end of the grantee's fiscal year period.
    SBA may withhold payment of advances or reimbursements if reports 
are not received or are regarded as inadequate.
    SBA may, at its discretion, reduce reporting requirements to semi-
annually as it deems appropriate. SBA will notify participants if it 
decides to take such action.

7. Match Requirements

    In general, funds awarded under the PRIME Program will require a 
non-Federal match of not less than 50% of each dollar awarded. Matching 
funds may come from fees, non-Federal grants, gifts, funds from loan 
sources, and in-kind resources. After the initial grant, grant awards 
for the following option years will be made in declining amounts, 
declining by 20% of the initial grant amount in each successive year.
    Exception: In the case of an applicant with severe constraints on 
available sources of matching funds, SBA may reduce or eliminate the 
50% match requirement on a case by case basis. Any reductions or 
eliminations must not exceed 10% of the aggregate of all PRIME grant 
funds made available by SBA in any fiscal year.
    Organizations seeking to receive a reduction or elimination of the 
matching fund requirement must include such a request (as a cover 
letter) with their proposal, and include justification and supporting 
documentation for their request. Submission of a request will not 
automatically guarantee that an exception, in whole or in part, will be 
granted. Rather, it will alert SBA to the applicant's desire to receive 
an exception.

8. Fundraising Not Allowable Expense

    Expenditures for fundraising activities are not allowable costs 
under this grant. Applicants must be able to raise matching funds 
without the assistance of grant funds. The applicant must demonstrate 
that it has adequate fundraising resources to obtain required non-
Federal matching funds to perform the project.

9. Subgrants

    An organization selected to receive a grant under the PRIME Program 
may provide sub-grants to qualified small and emerging microenterprise 
development organizations.
    Applicants wishing to provide sub-grants as a part of their 
implementation plan should include detailed information regarding same 
in their Technical Proposal.
    An applicant that wants to make subgrants using PRIME grant funds 
must receive written approval from SBA prior to making subgrants. The 
applicant must identify the subgrantee(s) and describe in detail what 
the subgrantee(s) will do to help the grantee implement its proposal. 
An applicant must submit information to SBA demonstrating that, through 
the subgrantee(s), the grantee's program will:
    (1) provide expanded services to the community,
    (2) provide a method by which one or more previously unserved 
communities will gain access to the program, or
     (3) provide other specific benefits to the clients, such as 
specialized training, expanded schedules of operation, or other 
benefits.
     If an applicant has identified potential subgrantee(s) at the time 
it submits an application for a PRIME grant, the applicant must include 
the information requested in paragraph above in the application. 
Otherwise, the applicant or grantee may submit the requested 
information at such time that approvals for subgrantee(s) are 
requested.
     The total amount of monies subgranted by the grantee must not 
exceed 50% of the total amount of the PRIME grant. A maximum of 7.5% of 
the funds awarded may be used by the grantee for administrative 
expenses in connection with the making of subgrants.

10. Subcontracts

     Any and all subcontracts awarded under this grant must be approved 
by SBA in advance and in writing and must not exceed 50% of the total 
amount of the PRIME grant.

11. Diversity

    In making grants under the Act, SBA will ensure that grant 
recipients include both large and small microenterprise organizations, 
serving diverse populations including urban, rural and Indian tribal 
communities serving diverse populations.

12. Prohibition on Preferential Consideration of Certain SBA Program 
Participants

    In making grants under this Program Announcement, SBA will not give 
preferential consideration to an applicant that is a participant in the 
program established under section 7(m) of the Small Business Act.

[[Page 60268]]

VII. OMB Uniform Administrative Requirements and Cost Principles

    The Prime Grant Notice of Award incorporates by reference all 
applicable OMB Circulars, including:
    1. OMB Circular A-21, ``Cost Principles for Educational 
Institutions,'' containing cost principles for educational 
institutions;
    2. OMB Circular A-87 ``Cost Principles for State, Local, and Indian 
Tribal Governments,'' containing cost principles for State, local 
governments, and federally recognized Indian tribal governments.
    3. OMB Circular A-110, ``Uniform Administrative Requirements for 
Grants and Agreements with Institutions of Higher Education, Hospitals, 
and Other Non-Profit Organizations,'' containing administrative 
requirements;
    4. OMB Circular A-122, ``Cost Principles for Non-Profit 
Organizations,'' containing cost principles for non-profits; and
    5. OMB Circular A-133, ``Audits of States, Local Governments, and 
Non-Profit Organizations,'' concerning audits.
    Current versions of OMB Circulars are available from the Office of 
Management and Budget's website. The address is: www.whitehouse.gov/WH/EOP/OMB/html/circular.html.

VIII. Proposal Instructions and Evaluation Criteria

    The technical and cost proposals must be bound separately. The 
technical proposal must be single-spaced and not exceed 50 pages, 
excluding exhibits and appendices. Prepare your proposal using the 
following outline.

1. Application Format

A. Technical Proposal

Section 1. Eligibility Requirements (not to exceed 5 pages)

    In this section the applicant must prove that it falls within one 
of the four categories of qualified organizations. (See Section IV)
    Applicants are reminded to include documentation of the mandatory 
eligibility requirements in their technical narrative. Failure to 
provide the mandatory eligibility documentation will result in 
disqualification of the application, and the application will not be 
evaluated. In addition, incomplete or illegible (in whole or in part) 
applications will not be evaluated.

Section 2. Applicant Experience and Activities. (not to exceed 15 
pages).

    Applicant experience includes information regarding current and 
past performance in providing training and technical assistance to 
disadvantaged entrepreneurs (as defined in this document.)
    In this section, the applicant should discuss the items delineated 
below. To the extent possible, the applicant should provide internal 
statistical data to document its past experience and illustrate current 
activities.
    1. An understanding of the microentrepreneur community and the 
needs of disadvantaged entrepreneurs.
    2. Its existing and historical training and technical assistance 
program. If the applicant is a start-up organization it should discuss 
in detail the its current methods of training. Details regarding 
curriculum, types of technical assistance offered, and counseling 
services should be included. This discussion should include a detailed 
description of the programmatic information regarding activities and 
services offered to low and very low income individuals, and the 
success rates of the clients served.
    3. As part of documenting past experience, the applicant should 
include a list of grants and or contracts similar in scope to the grant 
for which you are applying. Specifically provide the name, if any, of 
any Federal or non-Federal, agency(ies) or private sector foundations 
or organizations providing funding, the grant or contract number, a 
short summary of services provided under each grant, and the period(s) 
of performance. Include in each summary the name and contact 
information (phone number and E-mail address) of the person providing 
oversight on each grant or contract.
    4. Discuss your organization's ability to penetrate the target 
market, including past and current strategies for outreach.

Section 3. Institutional Capacity (not to exceed 5 pages)

    This section should include the following:

1. Personnel Qualifications and Internal Structure

     You must have, or exhibit the ability to obtain, personnel 
who are qualified to meet the goals of providing technical assistance 
under this grant. Provide resumes of personnel key to your 
organization's participation in the PRIME Program. The resumes should 
clearly present personnel's qualifications relative to this particular 
work. Special mention should be made of relevant experience. Personnel 
indicated must demonstrate knowledge of business development, business 
structures, business planning, marketing, business management, 
financial management, and training and counseling.
     Provide an organizational chart all proposed full-time and 
part-time project staff and the amount of time each will devote to the 
project. The PRIME Project Director must be a full time employee of the 
organization; however, the PRIME Project Director does not have to be 
solely dedicated to this activity. The Project Director (and other 
federally funded staff positions) must not engage in fundraising 
activities using Federal funds provided under this grant.
     Describe the role of subcontractors, subgrantees and/or 
outside consultants and indicate the percent of the project services 
you anticipate they will provide.
     Provide a description of at least one staff or consultant 
function to handle on-going program data collection and electronic 
reporting to SBA.
     Indicate the position(s) within your organization that 
will be responsible for financial record keeping regarding receipt and 
expenditure of program funds.

2. Data Collection and Maintenance Capacity

     Describe your organization's current client data 
collection and management system and how it will be used and/or 
modified to meet reporting and other requirements of this grant. If 
applying as a group or collaborative, describe how data management 
systems will be integrated for an inter-organizational uniform approach 
to data gathering and reporting.
     Discuss your organization's computer capacities, if any, 
and the software used. Indicate whether or not your organization is 
connected to the Internet and, if not, delineate plans to become 
connected. The applicant should indicate its level of willingness/
capability to report data via the Internet as well as how the applicant 
will accomplish its electronic management, communication, and reporting 
goals.
     Describe your organization's internal systems of checks 
and balances in terms of financial, data collection, and reporting 
systems. If applying as a group or collaborative, also describe the 
plan for inter-organizational checks and balances in terms of those 
systems. Also indicate which member of the group or collaborative will 
be responsible for coordination and submission of data and reports, and 
how the collaborative will ensure that this responsibility will be 
fully implemented.

[[Page 60269]]

Section 4. Program Narrative (not to exceed 15 pages)

    In this section, each applicant must set forth the following:
    1. Proposed training and technical assistance management plan. The 
management plan to provide training and technical assistance to 
disadvantaged entrepreneurs plan should include but not be limited to 
long and short term training, counseling and technical assistance. 
Technical assistance and training activities under the Act must include 
the following activities:
     assistance for the purpose of enhancing business planning,
     marketing assistance,
     management assistance,
     assistance with financial management skills, and
     assistance for the purpose of accessing financial 
services.
    For purposes of this grant program, technical assistance should be 
viewed as an ongoing function during the pre-start-up, start-up, 
maintenance, and growth periods of the business cycle. It includes, but 
is not necessarily limited to, assistance with the broad issues of 
business ownership such as business planning assistance, marketing 
assistance, management assistance, financial management skills 
assistance, and assistance for the purpose of accessing financial 
services. It should also include specific assistance in areas of 
expertise specific to the type of business being pursued. Technical 
assistance should include both counseling and training. Counseling 
should be viewed in terms of giving advice, guidance, or instruction 
specifically tailored to the needs of a single business. Training may 
include counseling, but can also include teaching in classroom or other 
public settings. Topics of training and counseling must include 
information necessary to start, manage, and/or operate a microbusiness. 
Information delivery media may vary from program to program and may 
include person to person oral communication, teleconferencing, video 
tape, printed materials, computer software, or any similar delivery 
mechanism provided it is effective in assisting clients in meeting 
their training goals. Technical assistance should not stop in the event 
microbusiness financing is obtained. It should continue through a 
significant period of time, to assist the microbusiness owner with 
continuing knowledge to enhance the chances for success.
    2. Outreach and delivery plan. The plan should include, but not 
necessarily be limited to:
     brief description and map of the proposed service area;
     demonstration of the need for this program in the proposed 
geographic area;
     description of the target market to be served--geographic 
size, population numbers, population type (empowerment zone, urban, 
rural, suburban, Indian reservation);
     plans for penetration of the target market;
     strategies to be used for reaching its scheduling and 
delivery goals;
     methods by which the applicant organization will 
incorporate outside resources into the plan;
     evidence of and/or plans for building relationships with 
financing sources and/or otherwise making financial assistance 
available to those clients in need of micro-level financing.
     discussion of how the applicant organization will reach 
its goals in terms of local nuances in population density, economic 
stratification, levels of education, and racial and ethnic oriented 
issues that affect the disadvantaged in the defined area of operation.

Section 5. Strategic Alliances and Partnerships (not to exceed 5 pages)

    In this section, the applicant should describe strategic alliances 
and partnerships with state and local entities. Inter-organizational 
cooperation regarding funding, training activities, utilization of 
space, utilization of human and other resources, client referral 
networks, and other such activities should be discussed. Organizations 
should illustrate how these alliances serve the best interests of 
disadvantaged entrepreneurs and how the alliances have enhanced the 
applicant's ability to provide training and technical assistance 
services to the target market.

Section 6 Timeline/Milestones (not to exceed 5 pages)

    In this section the applicant must include a timeline with 
milestones covering the 12-month grant period. Milestones should 
clearly illustrate the applicant's goals for training and technical 
assistance activity in terms of the projected client, projected 
programming, and projected use of funds.

Section 7. Supporting Documentation

    In this section the applicant should provide any necessary 
documentation to support its proposal, including but not limited to the 
following documents:
    1. A statement signed by your Executive Director (or his/her duly 
authorized representative), authorizing SBA to make inquiries to other 
Federal Agencies as to the performance capabilities of your 
organization.
    2. A copy of your organization's IRS tax exempt certificate 
including the IRS code under which your organization is considered non-
profit.
    3. Certification by your Secretary of State that your organization 
is legally allowed to do business in the State and a copy of your 
organization's articles of incorporation and by-laws.
    4. A copy of your organization's financial statements for the last 
3 years. If your organization has been in business for less than 3 
years, provide your year-end financial statements for those years 
completed and a year-to-date financial statement not less than 90 days 
old.
    5. A summary table of the training and technical assistance 
provided to date (limit to 3 pages). Include the income levels of 
clients served (low, very-low, other).
    6. Resumes and reference information for personnel key to the 
delivery of technical assistance services to date.
    7. An organizational chart of the entire organization. If you are 
applying as a group, or plan to use sub-contractors, or make sub-
grants, include a second organizational chart that shows how the 
members of the group will interact and collaborate and/or how the sub-
contractors and/or sub-grantees will fit into the work flow plan.
B. Cost Proposal
    The cost proposal must include the application cover sheet, budget 
information, assurances and certifications. Additional information on 
how to organize the proposal is provided on page 23, ``Preparing Your 
Budget.'' The applicant's Cost Proposal will be evaluated in terms of 
the quality and effectiveness of the proposed training and technical 
assistance to be provided.

2. Evaluation Factors

    SBA will evaluate applicant experience on two levels. Applicants 
having 4 years or less of experience providing training and technical 
assistance to disadvantaged entrepreneurs at time of application will 
be evaluated as ``start-up'' organizations. Applicants having more than 
4 years or more of experience providing such services at time of 
application will be evaluated as ``experienced'' organizations. Whether 
start-up, or experienced, applicants are expected to provide 
information as requested in this Program Announcement.

[[Page 60270]]

    Start-up organizations will be evaluated based on the general 
criteria listed below. The maximum number of points an applicant may 
receive for each criterion group are shown to the right of the listing.
    A. Institutional Capability (total of 90 points)
    The following factors are considered under this criteria:
    (1) Organizational structure, financial stability, and financial 
management systems (20).
    (2) Personnel (30).
    (3) Electronic communication or potential for same (20).
    (4) Data collection and reporting capability (20).
    B. Past performance and history of performing technical assistance, 
especially to low and very-low income microentrepreneurs (20 points).
    C. Management Plan for Proposed training and technical assistance, 
including outreach and delivery (total of 140 points).
    The following factors are considered under this criteria:
    (1) Proposed training and technical assistance activities to low 
and very low income mircoentrepreneurs (30).
    (2) Outreach and delivery plan (20).
    (3) Proposed use of community partnerships and collaborations with 
State and local entities (30).
    (4) The appropriateness of the proposed activity to the purposes of 
the Act (10).
    (5) The perceived ability of the applicant to carry out the 
proposed activity as well as the clarity of the proposal and its 
attainability in terms of the milestones set. (30).
    (6) Performance and outcome measurement tools (20).
    The total number of points an applicant may achieve as a start-up 
organization is 250. Experienced organizations will be evaluated based 
on the general criteria listed below. The maximum number of points an 
applicant may receive for each criterion group are shown to the right 
of the listing.
    A. Institutional Capability (total of 90 points).
    The following factors are considered under this criteria:
    (1) Organizational structure, financial stability, and financial 
management systems (20).
    (2) Personnel (30).
    (3) Electronic communication or potential for same (20).
    (4) Data collection and reporting capability (20).
    B. Past performance and history of performing technical assistance, 
especially to low and very-low income microentrepreneurs (20 points).
    C. Management Plan for Proposed training and technical assistance, 
including outreach and delivery (total of 140 points).
    The following factors are considered under this criteria:
    (1) Proposed training and technical assistance activities to low 
and very low income mircoentrepreneurs (30).
    (2) Outreach and delivery plan (20).
    (3) Proposed use of community partnerships and collaborations with 
State and local entities (30).
    (4) The appropriateness of the proposed activity to the purposes of 
the Act (10).
    (5) The perceived ability of the applicant to carry out the 
proposed activity as well as the clarity of the proposal and its 
attainability in terms of the milestones set. (30).
    (6) Performance and outcome measurement tools (20).
    The total number of points an applicant may achieve as a start-up 
organization is 250. As indicated above, applications will be reviewed 
for technical merit using the evaluation factors listed. Included in 
the evaluation processes will be qualitative and quantitative analyses 
of:
    a. the applicant's management plan to provide training and 
technical assistance as described in this Program Announcement. SBA 
will analyze items including but not limited to the methods, materials, 
and counseling used to provide training & technical assistance. The 
evaluation will also include the outreach and delivery plan to identify 
and provide the assistance to the targeted recipients.
    b. the applicants organizational structure, financial stability, 
financial management systems, personnel capacities, and electronic 
communication capabilities (or potential for same.) Additional analyses 
will be made regarding data collection capabilities, reporting 
capacities, and ability to account for performance of both the 
organization and the client.
    c. the applicant's current activity and history of providing 
technical assistance to low and very-low income microentrepreneurs will 
be evaluated considering patterns of program growth, client success, 
outcomes of training, success in establishing new businesses, and 
success in arranging micro-level financing in instances where a client 
indicated financing as a goal.
    d. the applicant's involvement in and ability to use community 
partnerships and collaboration with other entities will be analyzed. 
Collaborations will be analyzed in terms of any positive effects that 
such collaborations have had, or are anticipated to have on the 
applicant's ability to serve low- and very-low income 
microentrepreneurs. Applicants will also be evaluated in terms of the 
types, number, and frequency of collaborations needed based on the 
experience level of the organization.

IX. Option Year Funding

    Applicants shall prepare application cover sheets (SF Form 424) and 
budgets for each of the 5 budget periods consisting of 12 months each. 
Applicants are advised that the performance period for specific awards 
made under this announcement may consist of one base year with up to 4 
twelve-month option years. The project periods may consist of up to 5 
twelve-month budget periods. Each additional twelve-month budget period 
beyond the original base year may be exercised at the discretion of the 
Government. Among the factors involved in deciding whether to exercise 
an option are the availability of funds, continuing program 
authorization, satisfactory performance of the applicant, and the 
determination that continued funding would be in the best interest of 
the Government.
    After the initial grant, grant awards for the option years will be 
made in declining amounts, declining by 20 percent of the initial grant 
amount in each successive year.

X. Preparing Your Budget

INSTRUCTIONS FOR STANDARD FORM 424 (APPLICATION FOR FEDERAL ASSISTANCE)
    Standard Form 424, Application of Federal Assistance, will be found 
beginning at page A-1 of this announcement. This guidance supplements 
that contained on the reverse side of the form.

Item 1. Self-explanatory
Item 2. Refer to instructions on reverse of form
Item 3. Refer to instructions on reverse of form
Item 4. Leave Blank
Item 5. Refer to instructions on reverse of form
Item 6. Refer to instructions on reverse of form
Item 7. Refer to instructions on reverse of form
Item 8. Enter: ``new''
Item 9. Enter: ``U.S. Small Business Administration''
Item 10. Enter: 59.049 Program for Investment for Microentrepreneurs 
(PRIME)
Item 11. Refer to instructions on reverse of form
Item 12. Refer to instructions on reverse of form

[[Page 60271]]

Item 13. Refer to instructions on reverse of form
Item 14. Refer to instructions on reverse of form
Item 15. Refer to instructions on reverse of form
Item 16. Enter: Check ``b.'' This program is not covered by E.O. 12372.
Item 17. Refer to instructions on reverse of form
Item 18. Refer to instructions on reverse of form
INSTRUCTIONS FOR STANDARD FORM 424A (BUDGET INFORMATION)
    Budget information is found on pages A-1 through A-11.
    The budget is the applicant's estimate of the total cost of 
performing the project or activity for which grant support is 
requested. The budget is to be based upon the cost of performing the 
project, including Federal and private sources. All proposed costs 
reflected in the budget must be necessary to the project, reasonable 
and otherwise allowable under applicable cost principles and Agency 
policies. All costs must be justified and itemized by unit cost on the 
Budget Worksheets (p. A-3).

Section A--Budget Summary

    Column (A): Enter ``PRIME 01-1''.

Column (B): Enter the Catalog of Federal Domestic Assistance Number 
59.049.

Section B--Budget Categories
    Amounts entered by budget category in this section are for summary 
purposes only. Itemization and justification of specific needs by 
budget category are to be shown under line 21, Section F.
    Line 6.a.-6.h. The budget amounts must reflect the total 
requirements for funds regardless of the source of funds. All amounts 
entered in this section are to be expressed in terms of whole dollars 
only after completing the requirements of Section F.
    Line 6.j. Indirect costs are those costs related to the project 
that are not included as direct costs in a. through h.

Section C--Non-Federal Resources

    Refer to instructions on reverse of form.

Section D--Forecasted Cash Needs

    Refer to instructions on reverse of form.

Section E--Budget Estimates of Federal Funds Needed for Balance of the 
Project

    Refer to instructions on reverse of form.

Section F--Other Budget Information

    Line 21, Direct Charges: Identify and explain all items or 
categories under Section B in accordance with the instructions set 
forth below. The itemization must reflect the total requirements for 
funding from Federal and non-Federal sources. In most instances, Line 
21 does not provide sufficient space to reflect all of the necessary 
information. Budget Worksheets are enclosed for your convenience. You 
may use these worksheets for the detailed budget information listed 
below or a reasonable facsimile; BUT each budget line item pertinent to 
your submission MUST ALSO be completed on the application. Please show 
a complete breakdown of all cost elements summarized in Section B on a 
separate sheet. Do not list on Line 21 any items included in the 
indirect expenses entered on Line 22 below.
    a. Personnel: List the name, title, salary and estimated amount of 
time for each employee who will be assigned to this project. Note that 
fees, expenses, and estimated amount of time for outside consultants 
should be included in f., Contractual. The estimated performance time 
for outside consultants is not to exceed 50 percent of the total amount 
of the Prime grant. Resumes of all personnel assigned to this effort 
must be included in the application.
    b. Fringe Benefits: Leave blank if fringe benefits applicable to 
direct salaries and wages are treated as part of indirect costs in the 
indirect cost rate negotiation agreement. If your organization does not 
have a federally negotiated fringe benefit package, list each component 
included as a fringe benefit.
    c. Travel: Reimbursement will be made based on incurred cost. 
Estimates should be based on knowledge of the geographical area of 
small business locations. Reimbursement to contractors or volunteers 
will not be made for time in travel to and from the client's location. 
Supporting data should include numbers of trips anticipated, costs per 
trip per person, destinations proposed, modes of transportation, and 
related subsistence expenses.
    Line 22 Indirect Charges:
    (Attach Budget Worksheets or reasonable facsimile if sufficient 
space is not provided.)
    Enter the indirect cost rate, date, and agency that issued rate.
    If an indirect cost rate is not established, itemize elements and 
costs of overhead and G&A (General and Administrative) expense 
categories relative to the performance of this project.

XI. Assembly And Mailing Instructions

    1. Please indicate the following information on the front of your 
return envelope:
    a. Your organization's name and return address including zip code 
in the upper left-hand corner of the return envelope.
    b. Place the following notation in the lower left-hand corner of 
the sealed envelope.
    THIS IS A SEALED OFFER. DO NOT OPEN. STAMP THE DATE AND TIME 
RECEIVED ON THE ENVELOPE. THIS PROPOSAL IS IN RESPONSE TO PROGRAM 
ANNOUNCEMENT NUMBER, ________ DUE ________, 2000, AT 4:00 P.M., EASTERN 
STANDARD TIME, AT THE U.S. SMALL BUSINESS ADMINISTRATION, OFFICE OF 
PROCUREMENT & GRANTS MANAGEMENT, 409 3RD STREET, SW, 5TH FLOOR, 
WASHINGTON, DC 20416, ATTENTION: MINA BOOKHARD.
    2. Application. Please submit an original and 2 copies of the pages 
described below in items a and b. They are part of the Announcement and 
should be completed and submitted with an original and 2 copies of your 
proposal:
    a. The Federal Assistance Application (Standard Form 424), 
including the cost and technical proposals, and related budgetary data.
    b. Appendix B, Assurances and Certifications (with appropriate 
signature).
    3. To facilitate review and processing of the proposals, your 
submission must be arranged, as follows, in two separately bound parts:
    a. Part I: COST PROPOSAL--This part is to be comprised of the 
Application, the Budget Information, and the Assurances and 
Certifications. The material identified as Part I must be bound 
separately from the Technical Proposal. DO NOT include any technical 
information in Part I, The Cost Proposal.
    b. Part II: TECHNICAL PROPOSAL--This part is comprised of the 
Program Narrative. The proposal should be completed with a table of 
contents and must be responsive to the evaluation criteria set forth on 
the pages 20-22. The Technical Proposal must be bound separately from 
Section I and must not exceed 50 pages, excluding exhibits and 
appendices. DO NOT include any cost information in Part II, The 
Technical Proposal.
    4. Your application should be submitted in original and 2 copies 
to:

[[Page 60272]]

U.S. Small Business Administration, Office of Procurement and Grants 
Management, 409 Third Street, SW, 5th Floor, Washington, DC 20416, 
ATTN: Mina Bookhard.

XII. Late Submission, Revisions and Withdrawals

    1. Any Application received at the Office of Procurement and Grants 
Management after the exact time specified for receipt will not be 
considered unless it is received before award is made, AND:
    a. It was sent by registered or certified U.S. mail not later than 
the fifth calendar day before the date specified for receipt of offers 
(e.g., an offer submitted in response to a solicitation requiring 
receipt of offers by the 20th of the month must have been mailed by the 
15th);
    b. It was sent by U.S. mail or hand-carried (including delivery by 
a commercial carrier) if it is determined by the Government that the 
late receipt was due primarily to Government mishandling after receipt 
at the Government installation;
    c. It was sent by U.S. Postal Service Express Mail Next Day 
Service-Post Office to Addressee, not later than 5:00 p.m. at the place 
of mailing two working days prior to the date specified for receipt of 
proposals. The term ``working days'' excludes weekends and U.S. Federal 
holidays;
    d. There is acceptable evidence to establish that it was received 
at OPGM and was under the Government's control prior to the time set 
for receipt of offers, and the Grants Management Officer determines 
that accepting the late offer would not unduly delay the grant review 
process; or
    e. It is the only proposal received.

XIII. Unsuccessful Applicants

    After a decision has been reached and if your proposal is not 
successful, you will receive written notification. This written notice 
will be SBA's final response to this program announcement. SBA will not 
provide debriefing sessions if your proposal was not successful.

XIV. Cancellation

    SBA reserves the right to cancel this announcement in whole or in 
part at the Agency's discretion.

XV. Glossary of Terms

     ADMINISTRATION: Means the U.S. Small Business 
Administration (SBA);
     ADMINISTRATOR: Means the Administrator of the Small 
Business Administration;
     CAPACITY BUILDING SERVICES: means services provided to an 
organization or program that is, or is developing as, a microenterprise 
development organization or program, for the purpose of enhancing its 
ability to provide training and services to disadvantaged 
entrepreneurs;
     COLLABORATIVE: means two or more nonprofit entities that 
agree to act jointly as a qualified organization under this part;
     DISADVANTAGED ENTREPRENEUR, or DISADVANTAGED 
MICROENTREPRENEUR: means the owner, majority owner, or developer of a 
microenterprise who is also--
    1. A low-income person
    2. A very low-income person; or
    3. An entrepreneur who lacks adequate access to capital or other 
resources essential for business success, or, is economically 
disadvantaged as determined by the Administrator.
     EMERGING MICROENTERPRISE DEVELOPMENT ORGANIZATION OR 
PROGRAM: means a microenterprise development organization or program 
which has a microenterprise capacity building services component, but 
has had such a component for less than 4 years at the date of its 
application for a PRIME grant.
     GRANTEE: means a recipient of a grant under the Act.
     GROUP: has the same meaning as ``collaborative'' defined 
above.
     INDIAN TRIBE: means any Indian tribe, band, pueblo, 
nation, or other organized group or community, including any Alaska 
Native village or regional or village corporation, as defined in or 
established pursuant to the Alaska Native Claims Settlement Act, which 
is recognized as eligible for the special programs and services the 
United States provides to Indians because of their status as Indians.
     INDIAN TRIBE JURISDICTION: means Indian country, as 
defined in 18 U.S.C. 1151, and any other lands, title to which is 
either held by the United States in trust for the benefit of any Indian 
tribe or individual or held by any tribe or individual subject to a 
restriction by the United States against alienation, and any land held 
by Alaska Native groups, regional corporations, and village 
corporations, as defined in or established under the Alaska Native 
Claims Settlement Act, public domain Indian allotments, and former 
Indian reservations in the State of Oklahoma.
     INTERMEDIARY: means a private, nonprofit entity that seeks 
to serve qualified microenterprise development organizations and 
programs;
     LARGE MICROENTERPRISE DEVELOPMENT ORGANIZATION OR PROGRAM: 
means a microenterprise development organization or program with 10 or 
more full time employees or equivalents, including its executive 
director, as of the date it files its application with SBA for a PRIME 
grant.
     LOCAL COMMUNITY: means an identifiable area and population 
constituting a political subdivision of a state.
     LOW-INCOME PERSON: means a person having an income, 
adjusted for family size, of not more than--
    (1) for metropolitan areas, the greater of 80 percent of the median 
income; and
    (2) for non-metropolitan areas, the greater of--
    (a) 80 percent of the area median income; or
    (b) 80 percent of the statewide non-metropolitan area median 
income;
     MICROENTREPRENEUR: means the owner or developer of a 
microenterprise;
     MICROENTERPRISE: means a sole proprietorship, partnership, 
limited liability corporation or corporation that has fewer than 5 
employees, including the owner, and generally lacks access to 
conventional loans, equity, or other banking services.
     MICROENTERPRISE DEVELOPMENT ORGANIZATION OR PROGRAM: means 
a nonprofit entity, or a program administered by such an entity, 
including community development corporations or other nonprofit 
development organizations and social service organizations, that 
provides services to disadvantaged entrepreneurs.
     QUALIFIED ORGANIZATION: means an organization eligible for 
a PRIME grant that is--
    (1) a microenterprise development organization or program as 
defined above (or a group or collaborative thereof) that has 
demonstrated a record of delivering microenterprise services to 
disadvantaged microentrepreneurs;
    (2) an intermediary, as defined above;
    (3) a microenterprise development organization or program as 
defined above that is accountable to a local community, working with a 
State or local government or Indian tribe; or
    (4) an Indian tribe acting on its own, if the Indian tribe can 
certify that no private organization referred to in this definition 
exists within its jurisdiction.
     SEVERE CONSTRAINTS ON AVAILABLE SOURCES OF MATCHING FUNDS: 
means the documented inability of a qualified organization applying for 
a PRIME grant to raise matching funds or in-kind resources from non-
Federal sources during the 2 years immediately prior to the date of its 
application because of a lack of or increased scarcity of monetary or 
in-

[[Page 60273]]

kind resources from potential non-Federal sources.
     SMALL MICROENTERPRISE DEVELOPMENT ORGANIZATION OR PROGRAM: 
means a microenterprise development organization or program with less 
than 10 full time employees or equivalents, including its executive 
director, as of the date it files its application with SBA for a PRIME 
grant.
     TRAINING AND TECHNICAL ASSISTANCE: means services and 
support provided to disadvantaged entrepreneurs, such as assistance for 
the purpose of enhancing business planning, marketing, management, 
financial management skills, and assistance for the purpose of 
accessing financial services.
     VERY LOW INCOME PERSON: means having an income adjusted 
for family size of not more than 150 percent of the poverty line (as 
defined in Sec. 673(2) of the Community Services Block Grant Act (42 
U.S.C. 9902(2), including any revision required by that section).

XVI. Paperwork Reduction Act (44 U.S.C. Ch. 35)

    The information being requested in this Program Announcement is 
needed to evaluate applicants and ensure that awards are made in 
furtherance of the PRIME program's objectives. The information will be 
used to grant awards to provide training and technical assistance to 
disadvantaged microentrepreneurs. Applicants' responses to the data 
collection requirements are necessary for them to receive a benefit 
under the Prime Program. The information provided by applicants will be 
kept confidential to the extent required by law. Applicants are not 
required to respond to the Program Announcement unless it displays a 
currently valid OMB number. SBA estimates it will take applicants 80 
hours to respond.

XVII. Privacy Act (5 U.S.C. Sec. 552A)

    Any person can request to see or get copies of any personal 
information that SBA has in the requestor's file, when that file is 
retrieved by individual identifiers, such as name or social security 
number. Requests for information about another party may be denied 
unless SBA has the written permission of the individual to release the 
information to the requestor or unless the information is subject to 
disclosure under the Freedom of Information Act (FOIA).

    Note: Any person concerned with the collection, use and 
disclosure of information, under the Privacy Act may contact the 
Chief, Freedom of Information/Privacy Act Office, U.S. Small 
Business Administration, Suite 5900, 409 Third Street, SW, 
Washington, DC 20416, for information about the Agency's procedures 
relating to the Privacy Act and FOIA.

DATE:------------------------------------------------------------------
TO: Applicants
FROM: Office of Procurement and Grants Management (OPGM)
SUBJECT: Program Announcement No. PRIME 01-2, Program for Investment 
in Microenterprise Act, (``PRIME'') to Provide Microenterprise 
Development Organizations (MDOs) Capacity Building Services.

    The U.S. Small Business Administration plans to issue Federal grant 
awards to qualified organizations under PRIME to provide capacity 
building services to microenterprise development organizations and 
organizations interested in becoming microenterprise development 
organizations. These organizations include: Non-profit microenterprise 
development organizations or programs; intermediaries (as defined); 
other microenterprise development organizations or programs (as 
defined) that are accountable to a local community, working in 
conjunction with a State or local government or Indian tribe; or Indian 
tribes acting on their own, with proper certification that no other 
qualified organization exists within their jurisdiction.
    You are invited to submit an application, an original and two (2) 
copies, in response to Program Announcement No. PRIME 01-2. You are 
required to bind the cost proposal and technical proposal separately. 
Prepare the technical and cost proposals in single-spaced, 12-pt. font 
format. The technical proposal must not to exceed 45 pages, excluding 
exhibits and appendices. The Government will not return proposals, but 
will retain them for a limited period of time.
    The closing date for the program announcement is ________ , 4 p.m., 
Eastern Standard Time. Address your applications/proposal to the U.S. 
Small Business Administration, Office of Procurement and Grants 
Management (OPGM), 409 3rd Street, SW, 5th Floor, Washington, DC 20416, 
Attention: Mina Bookhard, Agreement Officer. If hand carried, deliver 
the application/proposal to Mina Bookhard, or her designee, at the 
above address. Deliveries to other locations will be considered late if 
not received in OPGM at the U.S. Small Business Administration by 4 
p.m. on ________ . Please place the following notation in the lower 
left corner of the sealed envelope or package:
    THIS IS A SEALED OFFER. DO NOT OPEN. STAMP THE DATE AND TIME 
RECEIVED ON THE ENVELOPE. THE ENCLOSED APPLICATION IS IN RESPONSE TO 
PROGRAM ANNOUNCEMENT NUMBER PRIME 01-2, DUE ________ AT 4 P.M., EASTERN 
STANDARD TIME, AT SBA's OFFICE OF PROCUREMENT & GRANTS MANAGEMENT.
    Applicants will be required to meet the standards for financial 
management systems as prescribed in the Office of Management and 
Budget's (OMB) Circular A-110, Subpart C, sections .21 through .28, and 
13 CFR Part 143.
    Questions concerning this program announcement should be directed 
to Warren Boyd at (202) 205-7534. Questions about budget or funding 
matters should be directed to Mina Bookhard, at (202) 205-7080.

Sincerely,

Sharon Gurley
Director, Office of Procurement and Grants Management
OFFICE OF FINANCIAL ASSISTANCE PROGRAM ANNOUNCEMENT

PROGRAM FOR INVESTMENT IN MICROENTREPRENEURS ACT, (``PRIME'')

TO PROVIDE CAPACITY BUILDING SERVICES TO NEW, EMERGING, AND EXISTING 
MICROENTERPRISE DEVELOPMENT ORGANIZATIONS

FISCAL YEAR 2001

U.S. SMALL BUSINESS ADMINISTRATION
OFFICE OF FINANCIAL ASSISTANCE
OPENING DATE:----------------------------------------------------------

CLOSING DATE:----------------------------------------------------------

ANNOUNCEMENT NO: PRIME 01-

TABLE OF CONTENTS

I. LEGISLATION PURPOSE
II. INTRODUCTION
III. PROGRAM OVERVIEW
IV. ELIGIBLE APPLICANTS FOR THIS GRANT
V. INELIGIBLE APPLICANTS FOR THIS GRANT
VI. GENERAL INFORMATION
VII. OMB UNIFORM ADMINISTRATIVE REQUIREMENTS AND COST PRINCIPLES
VIII. PROPOSAL INSTRUCTIONS AND EVALUATION CRITERIA
IX. OPTION YEAR FUNDING
X. PREPARING YOUR BUDGET
XI. ASSEMBLY AND MAILING INSTRUCTIONS
XII. LATE SUBMISSIONS, REVISIONS, WITHDRAWALS
XIII. UNSUCCESSFUL APPLICANTS
XIV. CANCELLATION
XV. GLOSSARY OF TERMS
XVIII. PAPERWORK REDUCTION ACT

[[Page 60274]]

XIX. PRIVACY ACT
APPENDIX A: APPLICATION FOR FEDERAL ASSISTANCE
APPENDIX B: ASSURANCES AND CERTIFICATIONS
APPENDIX C: MILESTONE CHARTS

I. Legislation Purpose

    The Program for Investment in Microentrepreneurs Act of 1999 (Pub. 
L. 106-102) became law on November 12, 1999. 15 U.S.C. 6901 et seq. 
(``PRIME'' or ``the Act). The Act authorizes the Administrator of the 
U.S. Small Business Administration (SBA) to establish a microenterprise 
training and technical assistance program for disadvantaged 
microentrepreneurs and to provide training and capacity building grant 
program to microenterprise development organizations (MDOs). 
Additionally, the Act authorizes research and development of best 
practices for microenterprise development and technical assistance 
programs for disadvantaged entrepreneurs and other activities as the 
Administrator of SBA determines are consistent with the Act. PRIME has 
several purposes for which SBA will issue separate program 
announcements soliciting applications geared toward a particular 
legislative purpose. Program Announcements called for under the Act 
solicit, from eligible organizations, applications for grant funding to 
be used to carry out the purposes of the Act as follows:
    Program Announcement No. PRIME 01-1 calls for applications from 
qualified organizations wishing to obtain grant funding for the purpose 
of providing training and technical assistance programs for 
disadvantaged microentrepreneurs.
    Program Announcement No. PRIME 01-2 calls for applications from 
qualified organizations wishing to obtain grant funding for the purpose 
of providing training and capacity building services to microenterprise 
development organizations and programs and groups of such organizations 
to assist them in developing microenterprise training and services.
    Program Announcement No. PRIME 01-3 calls for applications from 
qualified organizations wishing to obtain grant funding for the purpose 
of pursuing research and developing best practices in the field of 
microenterprise and technical assistance programs for disadvantaged 
microentrepreneurs.
    PRIME 01-2 solicits proposals from qualified organizations wishing 
to obtain grant funding for the purpose of providing Training and 
Capacity Building. These PRIME grants will enable MDOs to improve, 
expand, and/or enhance the number of MDOs providing training and 
technical assistance programs for disadvantaged microentrepreneurs.
    SBA will use 15 percent of available PRIME funds for grants that 
provide Training and Capacity Building services. Grants awarded under 
this program announcement will be for a minimum of $50,000 with no one 
grant exceeding $250,000 or 10% of the total appropriated, whichever is 
less.

II. Introduction

    Congress recognized that many disadvantaged microentrepreneurs lack 
sufficient training and education to gain access to capital to 
establish and expand their own small businesses. It enacted PRIME to 
augment training and technical assistance under the Small Business Act 
and other legislation. PRIME grants to qualified MDOs will help meet 
more training and technical assistance needs for disadvantaged 
microentrepreneurs, thereby encouraging entrepreneurship and community 
development.
    Many low income and very-low income entrepreneurs need training and 
technical assistance to start, operate, or expand their businesses. In 
order to achieve measurable success in the effort to providing direct 
training and technical assistance to low and very low income 
individuals, another goal of the PRIME Act is to expand and build the 
capacity of microenterprise development organizations (MDOs) to provide 
training and technical assistance to the microentrepreneur.
    For every business started or microloan made, a number of 
entrepreneurs are preparing themselves for a business start. A 
generally accepted assumption in the microenterprise industry is that 
it takes approximately 10 microentrepreneurs for every microenterprise 
started or booked. The cost of training is substantial because those at 
the entry-level stage of development typically require the greatest 
amount of dedicated advice and guidance, over an extended period of 
time, to achieve the highest rates of success. Funding is scarce 
relative to the need. The microenterprise industry has found the 
technical assistance-funding gap to be a nationwide condition, 
particularly in the very-low income sector.
    The Program for Investment in Microentrepreneurs (PRIME) authorizes 
SBA to make grants to ``qualified organizations'' to fund capacity 
building services to MDOs. The SBA will also make grants to provide 
training and technical assistance to low and very low income 
individuals, fund research and development of ``best practices'' in 
microenterprise development and technical assistance programs, and to 
fund other undertakings consistent with these purposes. The program 
requires that grantees match a portion of the SBA's funds with funds 
from other sources.
    The PRIME grant program should be viewed as a system of tiers. 
Primary MDOs (PMDOs) are those principally involved in the provision of 
financial and/or technical assistance services to individual clients, 
entrepreneurs, and microbusiness owners. Secondary MDOs (SMDOs) are 
those primarily involved in the training and capacity building of PMDOs 
through professional development, organizational development, and/or 
coordination of funds and services within a specific geographic area. 
While there may be instances where PMDO and SMDO activity types 
overlap, the distinction between the two types of organizations lies in 
the major focus of their respective activity. Training and Capacity 
Building may be viewed as separate and distinct activities, or may be 
presented as a single, integrated package of services. Training is best 
described as a classroom or course of study approach and will generally 
involve coursework, seminars, and other types of professional 
development activities designed to address a larger audience. Capacity 
Building, which may include a training aspect, will involve 
organizational development, site visits, individualized strategic 
planning, and goal-setting specifically designed to assist a single MDO 
(but ideally transferable to other MDOs). Capacity Building may also 
include, as indicated above, the coordination of activities, funds, and 
information for MDO networks or geographically related groups. 
Organizations applying for funding under this Program Announcement, 
PRIME-01-2, should remain cognizant of the information provided above 
as they plan and apply for funding.

III. Program Overview

    1. Project Name: Program for Investment in Microentrepreneurs 
(PRIME).
    2. Purpose: Provide Training and Capacity Building Services to 
MDOs, and organizations in the process of becoming MDOs, to enhance 
their ability to provide training and technical assistance to low, 
very-low income, and otherwise disadvantaged entrepreneurs.
    3. Federal Catalog Number: 59.049
    4. Authority: The Program for Investment in Microentrepreneurs Act

[[Page 60275]]

of 1999, ``PRIME'', Pub. L. 106-102, 15 U.S.C. Sec. 6901 et seq.
    5. Funding Instrument: Grant
    6. Funding: Funding is subject to availability and the requirements 
enumerated under the Act.
    7. Funding Range: Target award amounts will be a minimum of 
$50,000. Award amounts may vary, depending upon availability of funds 
(and performance for option years); however, no single person may 
receive more than $250,000 or 10 percent of the total funds made 
available for this program in a single fiscal year, whichever is less. 
In general, match is required, although SBA may reduce or eliminate the 
required match in certain circumstances (up to a program limit of 10 
percent).
    8. Number of Awards: SBA anticipates issuing multiple awards under 
this Announcement. The number may vary, based on the pool of qualified 
applicants and the amount of available funds. At least 15% of the funds 
available for grants under PRIME must be awarded under this Program 
Announcement.
    9. Targeted assistance: A minimum of 50% of the funds available for 
grants under the PRIME Act must be used to benefit very low income 
persons (as defined in this document), including those residing on 
Indian reservations.
    10. Closing Time and Date for the Submission of Applications: 
________ at 4 p.m. Eastern Daylight Time.
    11. Project Starting Date: ________ (estimated).
    12. Project Duration: The period performance for this grant is one 
base year with 4 twelve-month options subject to availability of funds 
and continued program authorization. The total possible period of 
performance is 5 years. Each option year will constitute a separate 
budget period. The project recipient's satisfactory performance will be 
one of the key factors in determining the award of an option year. 
Failure to secure the required annual non-Federal contribution during 
any project year may jeopardize continued option year funding.
    13. Proposal Evaluation: Applications will first be screened to 
determine if the applicant meets certain mandatory eligibility 
requirements. Applicants that do not document in their application that 
they meet these requirements will not be evaluated by SBA for 
participation in the Prime Program. In addition, applications that are 
incomplete, illegible, or unreadable, in whole or in part, will be 
deemed incomplete and will not be evaluated.
    Eligible proposals will be scored by an Objective Review Committee 
(ORC) based on evaluation criteria stated in this program announcement. 
The ORC will consist of SBA officials and may include Federal Officials 
from other agencies. Microenterprise Development Branch staff will 
review the ORC evaluations, the ORC's summary report on each applicant, 
and the applicant's proposals to determine the final scoring of award 
recipients. SBA may ask applicants for clarification on the technical 
and cost aspects of the proposals. Such clarifications must not be 
construed as a commitment to fund the proposed effort.
    14. Points of Contact: Questions concerning the technical aspects 
of this Program Announcement should be directed to the Microenterprise 
Development Branch at (202) 205-7534. However, due to the competitive 
process, SBA will be unable to assist with answers to specific 
questions regarding individual proposals or requests for assistance in 
completing proposals.
    Questions concerning budget or funding of this Grant should be 
directed to Mina Bookhard at (202) 205-6621.
    15. Award Notification: All applicants will receive a written 
notification relative to selection of award recipients. This written 
notice will be SBA's final response to this Program Announcement. SBA 
will not provide debriefing sessions if your proposal was not 
successful.
    16. Cancellation: SBA reserves the right to cancel this Program 
Announcement in whole or in part at the Agency's discretion.

IV. Eligible Applicants for This Grant

    An organization will be considered eligible for funding for the 
purpose of providing training and capacity building services to MDOs, 
or organizations in the process of becoming MDOs, if it is:
    1. A microenterprise development organization or program (or group 
or collaborative thereof) that has a demonstrated record of delivering 
microenterprise services to disadvantaged entrepreneurs, OR
    2. An intermediary (as defined in this document) which has 
experience in delivering technical assistance to disadvantaged 
entrepreneurs, OR
    3. A microenterprise development organization or program (as 
defined in this document) that is accountable to a local community, 
working in conjunction with a State or local government or Indian 
tribe, OR
    4. An Indian tribe acting on its own, if the Indian tribe can 
certify that no private organization or program referred to in this 
paragraph exists within its jurisdiction.
    An eligible applicant for a PRIME capacity building grant must 
provide documentation in its application demonstrating that it falls 
within one of the above categories of qualified organizations. Such 
documentation should include but is not limited to:
    1. A copy of your organization's IRS tax-exempt certificate 
including the IRS code under which your organization is considered non-
profit;
    2. Certification by your Secretary of State that your organization 
is legally allowed to do business in the State and a copy of your 
organization's articles of incorporation and by-laws;
    3. For category 4 in the preceding paragraph, written certification 
from a duly authorized person that no other qualified organization 
(i.e. private organization or program as defined in categories 1-3 
above) exists within its jurisdiction; and
    4. Financial statements for the past 3 years. If your organization 
has been in business for less than 3 years provide your year end 
financial statements for those years completed and a financial 
statement not less than 90 days old.
    SBA will not evaluate applications that do not meet these 
requirements. SBA may not screen applicants for eligibility until after 
the Closing Date for application acceptance. SBA will attempt to notify 
applicants of ineligible proposals as soon as practicable. However, SBA 
is under no obligation to notify ineligible applicants before the 
Closing Date. SBA strongly urges all applicants to ensure all 
eligibility requirements are met and documented before sending an 
application to SBA.

V. Ineligible Applicants for This Grant

    Regardless of the satisfactory submission of information called for 
in Paragraph IV, above, the following applicants will automatically be 
considered ineligible and their applications will not be evaluated:
    1. Any organization with an unresolved audit by any Federal agency.
    2. Any organization suspended or debarred from receiving grants 
from any Federal agency or otherwise excluded from Federal procurement 
or non-procurement programs.
    3. Any organization which has defaulted on an obligation to the 
United States.

VI. General Information

1. Definitions

    Throughout this Program Announcement specific terminology may be 
used, as defined in the Act and the accompanying rule (13 CFR part 119) 
published on ______ . The

[[Page 60276]]

definitions are contained in a glossary of terms located at the end of 
this document in Section XV.

2. Collaborative Applications

    a. If you participate in a collaborative (as defined in this 
document), all entities who are party to the collaborative must 
separately meet the statutory and eligibility requirements in order to 
apply as a collaborative.
    b. Applications from collaboratives must name the primary liaison 
with the Federal government and include a copy of the collaborative 
agreement outlining responsibilities of each partner organization. An 
authorized representative from each organization must sign the 
agreement. The primary liaison will be responsible for coordinating 
reporting and requests for funding.

3. Program Income

    All program income as defined in OMB Circular A-110, and OMB A-122 
must be reported on financial reports submitted to SBA and added to 
funds committed to the project by SBA and recipient organizations. 
Program income may only be used to further eligible program objectives.

4. Cost Principles

    a. General: All costs approved for a successful applicant must meet 
the tests of necessity, reasonableness, allowability and allocability 
in accordance with the cost principles applicable to this award. All 
proposed costs are subject to pre-award audit. Grantees are responsible 
to ensure proper management and financial accountability of Federal 
funds to preclude future cost disallowances. Payment will be made by 
reimbursement or advance payments as described in the grant award 
document and applicable OMB Circulars.
    b. Carryover Policy: The grantee may request approval to use 
unexpended funds in the next budget period. This is permissible if 
funds are to be used for a non-severable, non-recurring project or 
activity within the scope of the PRIME program. Non-severable means a 
project in its entirety that cannot be subdivided. The request for 
using unexpended funds in the next budget period must include the 
following:
    (1) SF 424, budget pages, and justification;
    (2) Explanation of why the funds were not expended during the 
period in which they were awarded; and
    (3) Evidence of match. The match requirement for funds carried over 
to the next budget period can be met by using any excess of matching 
funds from the current budget period, new matching funds, or a 
combination of both.
    The request must be made no later than 60 days before the end of 
the budget/project period or the de-obligation process will begin. 
Approved requests will require the issuance of a revised Notice of 
Award. Expenditures for funds carried over to the next budget period 
must be tracked separately.

5. Publications/Websites

    Any publications or websites developed under this grant must be 
submitted to SBA for prior review and approval. SBA will have an 
unlimited license to use data and written materials generated under 
this grant award, whether or not the materials are copyrighted. Any 
publications resulting from this project must include the following 
acknowledgement of support, whether copyrighted or not, in legible, 
easily readable print:

    This grant is partially funded by the U.S. Small Business 
Administration. SBA's funding is not an endorsement of any products, 
opinions, or services. All SBA funded programs are extended to the 
public on a nondiscriminatory basis.

    The grant recipient may not use the U.S. Small Business 
Administration name or logo for the endorsement of any services, 
products, or merchandise under this award.
    The SBA logo may appear on prominent webpages of Internet sites 
that are related to this project, but must appear with the above 
disclaimer in legible, easily readable print and acknowledgement of 
support in close physical proximity (within 2 inches) next to it.

6. Reports

a. General Reporting
    The selected grantees will be required to submit the reports as 
outlined below. Participants must agree to cooperate with SBA in the 
collection and retention of data required by this agency. Your ability 
to meet reporting requirements must be addressed in the Technical 
Proposal.
    Payments may be withheld if reports are not submitted within the 
required time frame or if the quality of reports is considered 
inadequate.
b. Performance Reports:
    Quarterly performance reports, unless otherwise specified, must 
contain a summary of activity for the reporting period using the 
following format:
    1. A comparison of actual accomplishments to the estimated 
milestones established in the proposal and/or subsequent grant 
agreement.
    2. A discussion of accomplished milestones and reasons for slippage 
in those cases where milestones are not met. Where milestones were not 
met, a plan of action must be provided to overcome these slippages or a 
detailed statement of how the program will better serve MDOs, and 
organizations in the process of becoming MDOs, if the milestones are 
revised.
    3. Evidence of the amount of funding expended to the benefit of 
very-low income program clients.
    4. Information relating to actual financial expenditures of 
budgeted cost categories versus the estimated budget award, including 
an explanation of all cost overruns, if any, by budgeted cost category. 
Financial data furnished in this report is from a manager's standpoint 
and is in addition to that furnished in the financial reports cited 
below.
    5. Other pertinent information, including any significant 
accomplishments or milestones of special significance that have been 
met.
    6. Because SBA is interested in the actual outcome of capacity 
building services provided under the PRIME Program, Client MDO Progress 
Reports will be required as part of the quarterly performance reports. 
As such, grantees will be required to compile, maintain, and submit 
data regarding each client as follows:
    A. At the start of the training relationship:
     Client identification information (location, urban, rural, 
tribal)
     Level of operating budget
     Total number of employees, excluding volunteers,
     Average number of employee hours used to provide training 
and technical assistance to disadvantaged entrepreneurs
     Average number of volunteer hours used per month for same 
purpose
     Number of clients served during each of two years prior to 
the start of the relationship and an indication of the number and 
percent of those clients that were low- or very-low income individuals
     The goal of the capacity building project or activity
    B. Follow-up:
     Changes in the operating budget of the client
     Changes in human resource utilization patterns (employees 
and volunteers)
     Changes in the numbers and percentages of end-user client 
service data as called for above
     Status of training in terms of the stated goal.
    Follow-up data should be collected on client MDOs on the six, 
twelve, and

[[Page 60277]]

eighteen-month anniversary of the beginning of the capacity building 
relationship. It is understood that new goals may be stated at the 
beginning of a new project or specific activity. This understanding is 
to be built into the grantee's reporting structure.
    Quarterly reports will be due no later than:
    (a) January 15 for the period ending December 31;
    (b) April 15 for the period ending March 31;
    (c) July 15 for the period ending June 30; and
    (d) October 15 for the period ending September 30.
c. Financial Reports
    1. Financial Status Report Forms must be submitted every quarter 
with the performance reports. Reports must include the SF 269, 
Financial Status Report, and the SF 272, Federal Cash Transactions 
Report.
    2. The year-end report must include a cost breakdown of actual 
expenditures and costs incurred by line item. Participants will also be 
required to submit the SBA Form 2069, Detailed Actual Expenditures for 
Period Covered by Request, with the final Standard Form 269.
    3. In addition, grantees will be required to submit audited annual 
financial statements, if available, or annual financial statements 
prepared by a licensed, independent public accountant, within 120 days 
of the end of the grantee's fiscal year period.
    SBA may withhold payment of advances or reimbursements if reports 
are not received or are regarded as inadequate.
    SBA may, at its discretion, reduce any reporting requirements to 
semi-annually as it deems appropriate. SBA will notify participants if 
it decides to take such action.

7. Match Requirements

    In general, funds awarded under the PRIME Program will require a 
non-Federal match of not less than 50% of each dollar awarded. Matching 
funds may come from fees, non-Federal grants, gifts, funds from loan 
sources, and in-kind resources. After the initial grant, grant awards 
for the following option years will be made in declining amounts, 
declining by 20% of the initial grant amount in each successive year.
    Exception: In the case of an applicant with severe constraints on 
available sources of matching funds, SBA may reduce or eliminate the 
50% match requirement on a case by case basis. Any reductions or 
eliminations must not exceed 10% of the aggregate of all PRIME grant 
funds made available by SBA in any fiscal year.
    Organizations seeking to receive a reduction or elimination of the 
matching fund requirement must include such a request (as a cover 
letter) with their proposal, and include justification and supporting 
documentation for their request. Submission of a request will not 
automatically guarantee that an exception, in whole or in part, will be 
granted. Rather, it will alert SBA to the applicant's desire to receive 
an exception.

8. Fundraising Not Allowable Expense

    Expenditures for fundraising activities are not allowable costs 
under this grant. Applicants must be able to raise matching funds 
without the assistance of grant funds. The applicant must demonstrate 
that it has adequate fundraising resources to obtain required non-
Federal matching funds to perform the project.

9. Subgrants

    An organization selected to receive a grant under the PRIME Program 
may provide sub-grants to qualified small and emerging MDOs solely for 
the purpose of having them assist with Training and Capacity Building 
services to other MDOs. Applicants wishing to provide sub-grants as a 
part of their implementation plan should include detailed information 
regarding same in their Technical Proposal. An applicant that wants to 
make subgrants using PRIME grant funds must receive written approval 
from SBA prior to making subgrants. The applicant must identify the 
subgrantee(s) and describe in detail what the subgrantee(s) will do to 
help the grantee implement its proposal. An applicant must submit 
information to SBA demonstrating that, through the subgrantee(s), the 
grantee's program will:
    (1) Provide expanded services to the community,
    (2) Provide a method by which one or more previously unserved 
communities will gain access to the program, or
    (3) Provide other specific benefits to the clients, such as 
specialized training, expanded schedules of operation, or other 
benefits.
    If an applicant has identified potential subgrantee(s) at the time 
it submits an application for a PRIME grant, the applicant must include 
the information requested in the paragraph above in the application. 
Otherwise, the applicant or grantee may submit the requested 
information at such time that approvals for subgrantee(s) are 
requested.
    The total amount of money subgranted by the grantee must not exceed 
50% of the amount of the PRIME grant. A maximum of 7.5% of the funds 
awarded may be used by the grantee for administrative expenses in 
connection with the making of subgrants.

10. Subcontracts

    Any and all subcontracts awarded under this grant must be approved 
by SBA in advance in writing and must not exceed 50% of the amount of 
the PRIME grant.

11. Diversity

    In making grants under this Program Announcement, SBA will ensure 
that grant recipients include both large and small microenterprise 
organizations, serving urban, rural and Indian tribal communities and 
diverse populations.

12. Prohibition on Preferential Consideration of Certain SBA Program 
Participants

    In making grants under this Program Announcement, SBA will not give 
preferential consideration to an applicant that is a participant in the 
program established under section 7(m) of the Small Business Act.

VII. OMB Uniform Administrative Requirements and Cost Principles

    The Prime Grant Notice of Award incorporates by reference all 
applicable OMB Circulars, including:
    1. OMB Circular A-21, ``Cost Principles for Educational 
Institutions,'' containing cost principles for educational 
institutions;
    2. OMB Circular A-87 ``Cost Principles for State, Local, and Indian 
Tribal Governments,'' containing cost principles for State, local 
governments, and federally recognized Indian tribal governments.
    3. OMB Circular A-110, ``Uniform Administrative Requirements for 
Grants and Agreements with Institutions of Higher Education, Hospitals, 
and Other Non-Profit Organizations,'' containing administrative 
requirements;
    4. OMB Circular A-122, ``Cost Principles for Non-Profit 
Organizations,'' containing cost principles for non-profits; and
    5. OMB Circular A-133, ``Audits of States, Local Governments, and 
Non-Profit Organizations,'' concerning audits.
    Current versions of OMB Circulars are available from the Office of 
Management and Budget's website. The address is: www.whitehouse.gov/WH/EOP/OMB/html/circular.html.

[[Page 60278]]

VIII. Proposal Instructions and Evaluation Criteria

    The technical and cost proposals must be bound separately. The 
technical proposal must be single-spaced and not exceed 45 pages, 
excluding exhibits and appendices. Prepare your proposal using the 
following outline.

1. APPLICATION FORMAT

A. Technical Proposal

Section 1. Eligibility Requirements (not to exceed 5 pages)

    In this section the applicant must prove that it falls within one 
of the four categories of qualified organizations. (See Section IV)
    Applicants are reminded to include documentation of the mandatory 
eligibility requirements in their technical narrative. Failure to 
provide the mandatory eligibility documentation will result in 
disqualification of the application, and the application will not be 
evaluated. In addition, incomplete or illegible (in whole or in part) 
applications will not be evaluated.

Section 2. Applicant Experience (not to exceed 15 pages)

    Applicant experience includes information regarding current and 
past performance in providing training and capacity building services 
to new, emerging, and existing MDOs.
    In this section, the applicant should discuss the items delineated 
below. To the extent possible, the applicant should provide internal 
statistical data to document its past experience and illustrate current 
activities.
    1. An understanding of the microentrepreneur and MDO communities 
and the needs of disadvantaged entrepreneurs.
    2. The applicant's existing and historical capacity building 
services to MDOs. This discussion should include a detailed description 
of the programmatic information as to the activities and services 
offered to MDOs with specific descriptions of the extent to which such 
services have improved the operations of client MDOs and assisted MDOs 
in reaching low and very low income individuals.
    3. Provide a list of grants and or contracts similar in scope to 
the grant for which you are applying. Specifically provide the name of, 
if any, any Federal, or non-Federal, agency(ies) or private sector 
foundations or organizations providing funding, the grant or contract 
number, a short summary of services provided under each grant, and the 
period(s) of performance. Include in each summary the name and contact 
information (phone number and E-mail address) of the person providing 
oversight on each grant or contract.

Section 3. Institutional Capacity (not to exceed 5 pages)

    This section should include the following:

1. Personnel Qualifications and Internal Structure

     You must have, or exhibit the ability to obtain, personnel 
who are qualified to meet the goals of providing technical assistance 
under this grant. Provide resumes of personnel key to your 
organization's participation in the PRIME Program. The resumes should 
clearly present personnel's qualifications relative to this particular 
work. Special mention should be made of relevant experience. Personnel 
indicated must demonstrate knowledge of business development, business 
structures, business planning, marketing, business management, 
financial management, and training and counseling.
     Organizational chart for all proposed full-time and part-
time project staff and the amount of time each will devote to the 
project. The Project Director must be a full time employee of the 
organization; however, the Project Director does not have to be 
dedicated solely to this activity. The Project Director (and other 
federally funded staff positions) must not engage in fundraising 
activities using Federal funds provided under this grant.
     A description of the role of subcontractors, subgrantees 
and/or outside consultants.
     A description of at least one staff or consultant function 
to handle on-going program data collection and electronic reporting to 
SBA.
     A description of whom will be responsible for financial 
record keeping on the receipt and expenditure of program funds.

2. Data Collection and Maintenance Capacity

     Describe your organization's current data collection and 
management system. If applying as a group or collaborative, describe 
how data management systems will be integrated for an inter-
organizational uniform approach to data gathering and reporting, as 
well as how these capabilities will or will not be integrated for 
training MDOs.
     Provide your organization's computer capacities, if any, 
and the software used. Indicate whether or not your organization is 
connected to the Internet and, if not, delineate plans to become 
connected. The applicant should indicate its level of willingness/ 
capability to report data via the Internet as well as how funds 
received under this grant may help the applicant accomplish its 
electronic management, communication, and reporting goals.
     Describe your organization's internal systems of checks 
and balances in terms of financial, data collection, and reporting 
systems. If applying as a group or collaborative, also describe the 
plan for inter-organizational checks and balances in terms of those 
systems. Also indicate which member of the group or collaborative will 
be responsible for coordination and submission of data and reports, and 
how the collaborative will ensure that this responsibility will be 
fully implemented.

Section 4. Program Narrative (not to exceed 15 pages)

    In this section, each applicant must describe the following:
    1. Its management plan to provide capacity building and training 
services to MDOs. This plan should include but not be limited to long 
and short term training, counseling and technical assistance.
    2. Its outreach and delivery plan. The plan should include, but not 
necessarily be limited to:
     A description of the types of client MDOs your 
organization plans to target including whether or not those client 
organizations serve very-low income populations
     A demonstration of the need for the planned services in 
terms of both the anticipated client base and the end user of the 
client MDOs' services;
     Strategies to be used for reaching your scheduling and 
delivery goals;
     Methods by which your organization will incorporate 
outside resources into the plan; and,
     A description of any planned or existing strategic 
alliances and partnerships with state and local entities (public or 
private) and how these alliances assist, or will assist, your 
organization in providing capacity building services to client MDOs.

Section 6. Timeline/Milestones (not to exceed 5 pages)

    In this section the applicant must include a timeline with 
milestones covering the 12-month grant period. Milestones should 
clearly illustrate the applicant's goals for delivery of capacity 
building services in terms of the number and types of projected 
clients, projected activities, and projected use of funds.

Section 7. Supporting Documentation

    In this section the applicant should provide any necessary 
documentation to

[[Page 60279]]

support its proposal, including but not limited to the following 
documents:
    1. A statement signed by your Executive Director (or an equivalent 
duly authorized person), authorizing SBA to make inquiries to other 
Federal Agencies as to the performance capabilities of your 
organization.
    2. A copy of your organization's IRS tax exempt certificate, 
including the IRS code under which your organization is considered non-
profit.
    3. Certification by your Secretary of State that your organization 
is legally allowed to do business in the State and a copy of your 
organization's articles of incorporation and by-laws.
    4. A copy of your organization's financial statements for the last 
3 years. If your organization has not been in business for 3 years, 
submit the most recent full-year financial statements and a copy of 
your organizations Year-to-Date balance sheet.
    5. A summary of the training and technical assistance provided to 
date (limit to 3 pages).
    6. Resumes and reference information for personnel key to the 
delivery of technical assistance services to date.
    7. An organizational chart, if you are applying as a group, or plan 
to use sub-contractors, include a second organizational chart that 
shows how the members of the group will interact and collaborate and/or 
how the sub-contractors will fit into the work flow plan.
B. Cost Proposal
    The cost proposal must include the application cover sheet, budget 
information, assurances and certifications. Additional information on 
how to organize the proposal is provided on page 21, ``Preparing Your 
Budget.'' The applicant's Cost Proposal will be evaluated in terms of 
the quality and effectiveness of the proposed capacity building 
services and impact as identified in item 3 of the evaluation factors.

2. Evaluation Factors

    Capacity Building awards will be competed among a single pool of 
applicants. The Technical Proposal will be evaluated in terms of the 
following evaluation criteria. The maximum number of points available 
under each criterion will be as follows:
    (a) Institutional Capability (total of 90 points) The following 
factors will be considered under this criteria:
    (1) Organizational structure, financial stability, and financial 
management systems (20)
    (2) Personnel (30)
    (3) Electronic communication or potential for same (20)
    (4) Data collection and reporting capability (20)
    (b) Past performance and history of providing capacity building 
services to Microenterprise Development Organizations (MDOs) (30)
    (c) Management plan for proposed training and capacity building 
assistance, including outreach and delivery (total of 80 points)
    The following factors will be considered under this criteria:
    (1) Proposed training and capacity building assistance to client 
MDOs and services to low-and very-low income microentrepreneurs (30)
    (2) Service plan and delivery (30)
    (3) Performance and outcome measurement tools (20)
    The total number of points an organization may attain under this 
evaluation system is 200.
    As indicated above, applications will be reviewed for technical 
merit using the evaluation factors listed. Included in the evaluation 
processes will be qualitative and quantitative analyses of:
    a. The applicant's organizational structure, financial stability, 
financial management systems, personnel capacity, and electronic 
communication capabilities (or potential for same). Additional 
evaluations will be made on the data collection capabilities, reporting 
capacities, and ability to account for performance.
    b. The applicant's history of providing capacity building services 
to MDOs, as an indication of the organization's understanding of the 
goals and purposes of capacity building, its historical effectiveness 
with the microenterprise development industry, and its ability to 
provide quality services to the targeted market. In addition, patterns 
of program growth, outcomes of training, types of services provided, 
delivery systems used, the number and types of clients served, and the 
successes realized within the client's organizational goals.
    c. The applicants projected impact on client MDOs, and on their 
ability to serve or improve services to low- and very-low income 
microentrepreneurs.
    d. The value of the proposed activity to the enhancement of the MDO 
community and the applicant's ability to attain the stated goals of the 
proposal. In addition, the transferability and replicability of the 
project will be considered.

IX. Option Year Funding

    Applicants will prepare application cover sheets (SF Form 424) and 
budgets for each of the 5 budget periods consisting of 12 months each. 
Applicants are advised that the performance period for specific awards 
made under this announcement may consist of one base year with up to 4 
twelve-month option years. The project periods may consist of up to 5 
twelve-month budget periods. Each additional twelve-month budget period 
beyond the original base year may be exercised at the discretion of the 
Government. Among the factors involved in deciding whether to exercise 
an option are the availability of funds, continuing program 
authorization, satisfactory performance of the applicant, and the 
determination that continued funding would be in the best interest of 
the Government.
    After the initial grant, grant awards for the option years will be 
made in declining amounts, declining by 20 percent of the initial grant 
amount in each successive year

X. Preparing Your Budget

    INSTRUCTIONS FOR STANDARD FORM 424 (APPLICATION FOR FEDERAL 
ASSISTANCE)
    Standard Form 424, Application of Federal Assistance, will be found 
beginning at page A-1 of this announcement. This guidance supplements 
that contained on the reverse side of the form.

Item 1. Self-explanatory
Item 2. Refer to instructions on reverse of form
Item 3. Refer to instructions on reverse of form
Item 4. Leave Blank
Item 5. Refer to instructions on reverse of form
Item 6. Refer to instructions on reverse of form
Item 7. Refer to instructions on reverse of form
Item 8. Enter: ``new''
Item 9. Enter: ``U.S. Small Business Administration''
Item 10. Enter: 59.049 Program for Investment for Microentrepreneurs 
(PRIME)
Item 11. Refer to instructions on reverse of form
Item 12. Refer to instructions on reverse of form
Item 13. Refer to instructions on reverse of form
Item 14. Refer to instructions on reverse of form
Item 15. Refer to instructions on reverse of form
Item 16. Enter: Check ``b.'' This program is not covered by E.O. 12372.
Item 17. Refer to instructions on reverse of form
Item 18. Refer to instructions on reverse of form

[[Page 60280]]

INSTRUCTIONS FOR STANDARD FORM 424A (BUDGET INFORMATION)

    Budget information is found on pages A-1 through A-11
    The budget is the applicant's estimate of the total cost of 
performing the project or activity for which grant support is 
requested. The budget is to be based upon the cost of performing the 
project, including Federal and private sources. All proposed costs 
reflected in the budget must be necessary to the project, reasonable 
and otherwise allowable under applicable cost principles and Agency 
policies. All costs must be justified and itemized by unit cost on the 
Budget Worksheets (p. A-3).

Section A--Budget Summary
Column (A): Enter ``PRIME 01-2''
Column (B): Enter the Catalog of Federal Domestic Assistance Number 
59.049
Section B--Budget Categories

    Amounts entered by budget category in this section are for summary 
purposes only. Itemization and justification of specific needs by 
budget category are to be shown under line 21, Section F.
    Line 6.a.-6.h. The budget amounts must reflect the total 
requirements for funds regardless of the source of funds. All amounts 
entered in this section are to be expressed in terms of whole dollars 
only after completing the requirements of Section F.
    Line 6.j. Indirect costs are those costs related to the project 
that are not included as direct costs in a. through h.

Section C--Non-Federal Resources

    Refer to instructions on reverse of form.

Section D--Forecasted Cash Needs

    Refer to instructions on reverse of form.

Section E--Budget Estimates of Federal Funds Needed for Balance of the 
Project

    Refer to instructions on reverse of form.

Section F--Other Budget Information

    Line 21, Direct Charges: Identify and explain all items or 
categories under Section B in accordance with the instructions set 
forth below. The itemization must reflect the total requirements for 
funding from Federal and non-Federal sources. In most instances, Line 
21 does not provide sufficient space to reflect all of the necessary 
information. Budget Worksheets are enclosed for your convenience. You 
may use these worksheets for the detailed budget information listed 
below or a reasonable facsimile; but each budget line item pertinent to 
your submission MUST ALSO be completed on the application. Please show 
a complete breakdown of all cost elements summarized in Section B on a 
separate sheet. Do not list on Line 21 any items included in the 
indirect expenses entered on Line 22 below.
    a. Personnel: List the name, title, salary and estimated amount of 
time for each employee who will be assigned to this project. Note that 
fees, expenses, and estimated amount of time for outside consultants 
should be included in f., Contractual. The estimated performance time 
for outside consultants is not to exceed 50% of the total amount of the 
grant. Resumes of all personnel assigned to this effort must be 
included in the application.
    b. Fringe Benefits: Leave blank if fringe benefits applicable to 
direct salaries and wages are treated as part of indirect costs in the 
indirect cost rate negotiation agreement. If your organization does not 
have a federally negotiated fringe benefit package, list each component 
included as a fringe benefit.
    c. Travel: Reimbursement will be made based on incurred cost. 
Estimates should be based on knowledge of the geographical area of 
small business locations. Reimbursement to contractors or volunteers 
will not be made for time in travel to and from the client's location. 
Supporting data should include numbers of trips anticipated, costs per 
trip per person, destinations proposed, modes of transportation, and 
related subsistence expenses.
    Line 22 Indirect Charges:
    (Attach Budget Worksheets or reasonable facsimile if sufficient 
space is not provided.)
    Enter the indirect cost rate, date, and agency that issued rate.
    If an indirect cost rate is not established, itemize elements and 
costs of overhead and G&A (General and Administrative) expense 
categories relative to the performance of this project.

XI. Assembly and Mailing Instructions

    1. Please indicate the following information on the front of your 
return envelope:
    a. Your organization's name and return address including zip code 
in the upper left-hand corner of the return envelope.
    b. Place the following notation in the lower left-hand corner of 
the sealed envelope.
    THIS IS A SEALED OFFER. DO NOT OPEN. STAMP THE DATE AND TIME 
RECEIVED ON THE ENVELOPE. THIS PROPOSAL IS IN RESPONSE TO PROGRAM 
ANNOUNCEMENT NUMBER,____ DUE, ____ 2000, AT 4:00 P.M., EASTERN STANDARD 
TIME, AT THE U.S. SMALL BUSINESS ADMINISTRATION, OFFICE OF PROCUREMENT 
& GRANTS MANAGEMENT, 409 3RD STREET, SW, 5TH FLOOR, WASHINGTON, DC 
20416, ATTENTION: MINA BOOKHARD.
    2. Application. Please submit an original and 2 copies of the pages 
described below in items a and b. They are part of the Announcement and 
should be completed and submitted with an original and 2 copies of your 
proposal:
    a. The Federal Assistance Application (Standard Form 424), 
including the cost and technical proposals, and related budgetary data.
    b. Appendix B, Assurances and Certifications (with appropriate 
signature).
    3. To facilitate review and processing of the proposals, your 
submission must be arranged, as follows, in two separately bound parts:
    a. Part I: COST PROPOSAL--This part is to be comprised of the 
Application, the Budget Information, and the Assurances and 
Certifications. The material identified as Part I must be bound 
separately from the Technical Proposal. DO NOT include any technical 
information in Part I, The Cost Proposal.
    b. Part II: TECHNICAL PROPOSAL--This part is comprised of the 
Program Narrative. The proposal should be completed with a table of 
contents and must be responsive to the evaluation criteria set forth on 
pages 20-21. The Technical Proposal must be bound separately from 
Section I and must not exceed 45 pages. DO NOT include any cost 
information in Part II, The Technical Proposal.
    4. Your application should be submitted in original and 2 copies 
to: U.S. Small Business Administration, Office of Procurement and 
Grants Management, 409 Third Street, SW, 5th Floor, Washington, DC 
20416, ATTN: Mina Bookhard.

XII. Late Submission, Revisions and Withdrawals

    1. Any Application received at the Office of Procurement and Grants 
Management after the exact time specified for receipt will not be 
considered unless it is received before award is made, AND:
    a. It was sent by registered or certified U.S. mail not later than 
the fifth calendar day before the date specified for receipt of offers 
(e.g., an offer

[[Page 60281]]

submitted in response to a solicitation requiring receipt of offers by 
the 20th of the month must have been mailed by the 15th);
    b. It was sent by U.S. mail or hand-carried (including delivery by 
a commercial carrier) if it is determined by the Government that the 
late receipt was due primarily to Government mishandling after receipt 
at the Government installation;
    c. It was sent by U.S. Postal Service Express Mail Next Day 
Service-Post Office to Addressee, not later than 5:00 p.m. at the place 
of mailing two working days prior to the date specified for receipt of 
proposals. The term ``working days'' excludes weekends and U.S. Federal 
holidays;
    d. There is acceptable evidence to establish that it was received 
at OPGM and was under the Government's control prior to the time set 
for receipt of offers, and the Grants Management Officer determines 
that accepting the late offer would not unduly delay the grant review 
process; or
    e. It is the only proposal received.

XIII. Unsuccessful Applicants

    After a decision has been reached and if your proposal is not 
successful, you will receive written notification. This written notice 
will be SBA's final response to this program announcement. SBA will not 
provide debriefing sessions if your proposal was not successful.

XIV. Cancellation

    SBA reserves the right to cancel this announcement in whole or in 
part at the Agency's discretion.

XV. Glossary of Terms

     ADMINISTRATION: Means the U.S. Small Business 
Administration (SBA);
     ADMINISTRATOR: Means the Administrator of the Small 
Business Administration;
     CAPACITY BUILDING SERVICES: means services provided to an 
organization or program that is, or is developing as, a microenterprise 
development organization or program, for the purpose of enhancing its 
ability to provide training and services to disadvantaged 
entrepreneurs;
     COLLABORATIVE: means two or more nonprofit entities that 
agree to act jointly as a qualified organization under this part;
     DISADVANTAGED ENTREPRENEUR, or DISADVANTAGED 
MICROENTREPRENEUR: means the owner, majority owner, or developer of a 
microenterprise who is also--
    1. A low-income person
    2. A very low-income person; or
    3. An entrepreneur who lacks adequate access to capital or other 
resources essential for business success, or, is economically 
disadvantaged as determined by the Administrator.
     EMERGING MICROENTERPRISE DEVELOPMENT ORGANIZATION OR 
PROGRAM: means a microenterprise development organization or program 
which has a microenterprise capacity building services component, but 
has had such a component for less than 4 years at the date of its 
application for a PRIME grant.
     GRANTEE: means a recipient of a grant under the Act.
     GROUP: has the same meaning as ``collaborative'' defined 
above.
     INDIAN TRIBE: means any Indian tribe, band, pueblo, 
nation, or other organized group or community, including any Alaska 
Native village or regional or village corporation, as defined in or 
established pursuant to the Alaska Native Claims Settlement Act, which 
is recognized as eligible for the special programs and services the 
United States provides to Indians because of their status as Indians.
     INDIAN TRIBE JURISDICTION: means Indian country, as 
defined in 18 U.S.C. Sec. 1151, and any other lands, title to which is 
either held by the United States in trust for the benefit of any Indian 
tribe or individual or held by any tribe or individual subject to a 
restriction by the United States against alienation, and any land held 
by Alaska Native groups, regional corporations, and village 
corporations, as defined in or established under the Alaska Native 
Claims Settlement Act, public domain Indian allotments, and former 
Indian reservations in the State of Oklahoma.
     INTERMEDIARY: means a private, nonprofit entity that seeks 
to serve qualified microenterprise development organizations and 
programs;
     LARGE MICROENTERPRISE DEVELOPMENT ORGANIZATION OR PROGRAM: 
means a microenterprise development organization or program with 10 or 
more full time employees or equivalents, including its executive 
director, as of the date it files its application with SBA for a PRIME 
grant.
     LOCAL COMMUNITY: means an identifiable area and population 
constituting a political subdivision of a state.
     LOW-INCOME PERSON: means a person having an income, 
adjusted for family size, of not more than--
    (1) for metropolitan areas, the greater of 80 percent of the median 
income; and
    (2) for non-metropolitan areas, the greater of--
    (a) 80 percent of the area median income; or
    (b) 80 percent of the statewide non-metropolitan area median 
income;
     MICROENTREPRENEUR: means the owner or developer of a 
microenterprise;
     MICROENTERPRISE: means a sole proprietorship, partnership, 
limited liability corporation or corporation that has fewer than 5 
employees, including the owner, and generally lacks access to 
conventional loans, equity, or other banking services.
     MICROENTERPRISE DEVELOPMENT ORGANIZATION OR PROGRAM: means 
a nonprofit entity, or a program administered by such an entity, 
including community development corporations or other nonprofit 
development organizations and social service organizations, that 
provides services to disadvantaged entrepreneurs.
     QUALIFIED ORGANIZATION: means an organization eligible for 
a PRIME grant that is--
    1. a microenterprise development organization or program as defined 
above (or a group or collaborative thereof) that has demonstrated a 
record of delivering microenterprise services to disadvantaged 
microentrepreneurs;
    2. an intermediary, as defined above;
    3. a microenterprise development organization or program as defined 
above that is accountable to a local community, working with a State or 
local government or Indian tribe; or
    4. an Indian tribe acting on its own, if the Indian tribe can 
certify that no private organization referred to in this definition 
exists within its jurisdiction.
     SEVERE CONSTRAINTS ON AVAILABLE SOURCES OF MATCHING FUNDS: 
means the documented inability of a qualified organization applying for 
a PRIME grant to raise matching funds or in-kind resources from non-
Federal sources during the 2 years immediately prior to the date of its 
application because of a lack of or increased scarcity of monetary or 
in-kind resources from potential non-Federal sources.
     SMALL MICROENTERPRISE DEVELOPMENT ORGANIZATION OR PROGRAM: 
means a microenterprise development organization or program with less 
than 10 full time employees or equivalents, including its executive 
director, as of the date it files its application with SBA for a PRIME 
grant.
     TRAINING AND TECHNICAL ASSISTANCE: means services and 
support provided to disadvantaged entrepreneurs, such as assistance for 
the purpose of enhancing business planning, marketing, management,

[[Page 60282]]

financial management skills, and assistance for the purpose of 
accessing financial services.
     VERY LOW INCOME PERSON: means having an income adjusted 
for family size of not more than 150 percent of the poverty line (as 
defined in 673(2) of the Community Services Block Grant Act (42 U.S.C. 
9902(2), including any revision required by that section).

XVI. Paperwork Reduction Act (44 U.S.C. Ch. 35)

    The information being requested in this Program Announcement is 
needed to evaluate applicants and ensure that awards are made in 
furtherance of the PRIME program's objectives. The information will be 
used to grant awards to provide training and technical assistance to 
disadvantaged microentrepreneurs. Applicants' responses to the data 
collection requirements are necessary for them to receive a benefit 
under the Prime Program. The information provided by applicants will be 
kept confidential to the extent required by law. Applicants are not 
required to respond to the Program Announcement unless it displays a 
currently valid OMB number. SBA estimates it will take applicants 80 
hours to respond.

XVII. Privacy Act (5 U.S.C. 552a)

    Any person can request to see or get copies of any personal 
information that SBA has in the requestor's file, when that file is 
retrieved by individual identifiers, such as name or social security 
number. Requests for information about another party may be denied 
unless SBA has the written permission of the individual to release the 
information to the requestor or unless the information is subject to 
disclosure under the Freedom of Information Act (FOIA).

    Note: Any person concerned with the collection, use and 
disclosure of information, under the Privacy Act may contact the 
Chief, Freedom of Information/Privacy Act Office, U.S. Small 
Business Administration, Suite 5900, 409 Third Street, SW, 
Washington, DC 20416, for information about the Agency's procedures 
relating to the Privacy Act and FOIA.


DATE:------------------------------------------------------------------
TO: Applicants
FROM: Office of Procurement and Grants Management (OPGM)
SUBJECT: Program Announcement No. PRIME 01-3, Program for Investment 
in Microenterprise Act, (``PRIME'') for Research and Development of 
Best Practices in the Field Microenterprise and Technical Assistance 
to Disadvantaged Entrepreneurs.

    The U.S. Small Business Administration plans to issue Federal 
grants awards to qualified organizations under PRIME to provide 
research and development in the field of microenterprise and technical 
assistance programs to disadvantaged entrepreneurs. These organizations 
include: non-profit microenterprise development organizations or 
programs; intermediaries (as defined); other microenterprise 
development organizations or programs (as defined) that are accountable 
to a local community, working in conjunction with a State or local 
government or Indian tribe; or Indian tribes acting on their own, with 
proper certification that no other qualified organization exists within 
their jurisdiction.
    You are invited to submit an application, an original and two (2) 
copies, in response to Program Announcement No. PRIME 01-3. You are 
required to bind the cost proposal and technical proposal separately. 
Prepare the technical and cost proposals in single-spaced 12-pt. font 
format, not to exceed 45 pages including exhibits and appendices. The 
Government will not return proposals, but will retain them for a 
limited period of time. The closing date for the program announcement 
is ____________, 4:00 P.M., Eastern Standard Time. Address your 
applications/proposal to the U.S. Small Business Administration, Office 
of Procurement & Grants Management (OPGM), 409 3rd Street, SW, 5th 
Floor, Washington, DC 20416, Attention: Mina Bookhard, Agreement 
Officer. If hand carried, deliver the application/proposal to Mina 
Bookhard, or her designee, at the above address. Deliveries to other 
locations will be considered late if not received in OPGM at the U.S. 
Small Business Administration by 4:00 p.m. on ____________. Please 
place the following notation in the lower left corner of the sealed 
envelope or package:
    THIS IS A SEALED OFFER. DO NOT OPEN. STAMP THE DATE AND TIME 
RECEIVED ON THE ENVELOPE. THE ENCLOSED APPLICATION IS IN RESPONSE TO 
PROGRAM ANNOUNCEMENT NUMBER PRIME 01-3, DUE ____________ AT 4:00 P.M., 
Eastern Standard Time, AT SBA's OFFICE OF PROCUREMENT & GRANTS 
MANAGEMENT.
    Applicants will be required to meet the standards for financial 
management systems as prescribed in the Office of Management and 
Budget's (OMB) Circular A-110, Subpart C, sections .21 through .28, and 
13 C.F.R. Part 143.
    Questions concerning this program announcement should be directed 
to Warren Boyd at (202) 205-7534. Questions about budget or funding 
matters should be directed to Mina Bookhard, at (202) 205-7080.

Sincerely,
Sharon Gurley,
Director, Office of Procurement and Grants Management
OFFICE OF FINANCIAL ASSISTANCE
PROGRAM ANNOUNCEMENT

PROGRAM FOR INVESTMENT IN MICROENTREPRENEURS ACT, (``PRIME'')

TO RESEARCH AND DEVELOP BEST PRACTICES IN THE FIELD OF MICROENTERPRISE 
AND TECHNICAL ASSISTANCE PROGRAMS TO DISADVANTAGED ENTREPRENEURS

FISCAL YEAR 2001

U.S. SMALL BUSINESS ADMINISTRATION
OFFICE OF FINANCIAL ASSISTANCE
OPENING DATE:----------------------------------------------------------

CLOSING DATE:----------------------------------------------------------

ANNOUNCEMENT NO: PRIME 01-3

TABLE OF CONTENTS

I. LEGISLATION PURPOSE
II. INTRODUCTION
III. PROGRAM OVERVIEW
IV. ELIGIBLE APPLICANTS FOR THIS GRANT
V. INELIGIBLE APPLICANTS FOR THIS GRANT
VI. GENERAL INFORMATION
VII. OMB UNIFORM ADMINISTRATIVE REQUIREMENTS AND COST PRINCIPLES
VIII. PROPOSAL INSTRUCTIONS AND EVALUATION CRITERIA
IX. OPTION YEAR FUNDING
X. PREPARING YOUR BUDGET
XI. ASSEMBLY AND MAILING INSTRUCTIONS
XII. LATE SUBMISSIONS, REVISIONS, WITHDRAWALS
XIII. UNSUCCESSFUL APPLICANTS
XIV. CANCELLATION
XV. GLOSSARY OF TERMS
XX. PAPERWORK REDUCTION ACT
XXI. PRIVACY ACT
APPENDIX A: APPLICATION FOR FEDERAL ASSISTANCE
APPENDIX B: ASSURANCES AND CERTIFICATIONS
APPENDIX C: MILESTONE CHARTS

I. Legislation Purpose

    The Program for Investment in Microentrepreneurs Act of 1999 (P.L. 
106-102) became law on November 12, 1999. 15 U.S.C. 6901 et seq. 
(``PRIME'' or ``the Act''). The Act authorizes the Administrator of the 
U.S. Small Business Administration (SBA) to establish a microenterprise 
training and technical assistance program for disadvantaged 
microentrepreneurs and

[[Page 60283]]

to provide training and capacity building grant program to 
microenterprise development organizations (MDOs). Additionally, the Act 
authorizes research and development of best practices for 
microenterprise development and technical assistance programs for 
disadvantaged entrepreneurs and other activities as the Administrator 
of SBA determines are consistent with the Act.
    PRIME has several purposes for which SBA will issue separate 
program announcements soliciting applications geared toward a 
particular legislative purpose.
    Program Announcements called for under the Act solicit, from 
eligible organizations, applications for grant funding to be used to 
carry out the purposes of the Act as follows:
    Program Announcement No. PRIME 01-1 calls for applications from 
qualified organizations wishing to obtain grant funding for the purpose 
of providing training and technical assistance programs for 
disadvantaged microentrepreneurs.
    Program Announcement No. PRIME 01-2 calls for applications from 
qualified organizations wishing to obtain grant funding for the purpose 
of providing training and capacity building services to microenterprise 
development organizations and programs and groups of such organizations 
to assist them in developing microenterprise training and services.
    Program Announcement No. PRIME 01-3 calls for applications from 
qualified organizations wishing to obtain grant funding for the purpose 
of pursuing research and developing best practices in the field of 
microenterprise and technical assistance programs for disadvantaged 
microentrepreneurs.
    The purpose of this Program Announcement No. PRIME 01-3, is to 
solicit applications from eligible organizations wishing to obtain 
grant funding for the purpose of conducting research development of 
microenterprise development best practices. Specifically, PRIME-01-3 
solicits proposals from qualified organizations wishing to obtain grant 
funding for the purpose of researching and developing best practices in 
the field of microenterprise and technical assistance programs for 
disadvantaged microentrepreneurs. Grants will be awarded subject to the 
availability of funds. And, no single entity will receive a grant in 
excess of $250,000 or 10% of the total amount appropriated, whichever 
is less.

II. Introduction

    Congress recognized that many disadvantaged microentrepreneurs lack 
sufficient training and education to gain access to capital to 
establish and expand their own small businesses. It enacted PRIME to 
augment training and technical assistance under the Small Business Act 
and other legislation, and to foster research and development of best 
practices in microenterprise and technical assistance to disadvantaged 
microentrepreneurs to further advance programs to the disadvantaged 
microentrepreneurs and further advance the microenterprise industry.
    Many low income and very-low income entrepreneurs need training and 
technical assistance to start, operate, or expand their businesses. In 
order to achieve measurable success in the effort to providing direct 
training and technical assistance to low and very low income 
individuals, PRIME will award grants for the research and development 
of best practices in the delivery of services to disadvantaged 
microentrepreneurs.
    For every business started or microloan made, a number of 
entrepreneurs are preparing themselves for business start. A generally 
accepted assumption in the microenterprise industry is that it takes 
approximately 10 potential microentrepreneurs for every microenterprise 
started or microloan booked. The cost of training is substantial 
because those at the entry-level stage of development typically require 
the greatest amount of dedicated advice and guidance, over an extended 
period of time, to achieve the highest rates of success. Funding is 
scarce relative to the need. The microenterprise industry has found the 
technical assistance-funding gap to be a nationwide condition, 
particularly in the very low-income sector.
    The Program for Investment in Microenterpreneurs (PRIME) authorizes 
SBA to make grants to fund research and development of ``best 
practices.'' The microenterprise development industry has reached a 
stage of development that can produce, and will benefit from, 
substantive research that captures the best practices in this area. The 
program requires that grantees match a portion of the SBA's funds with 
funds from other sources.

III. Program Overview

    1. Project Name: Program for Investment in Microentrepreneurs 
(PRIME).
    2. Purpose: Aid in researching and developing best practices in the 
field of microenterprise and technical assistance programs for 
disadvantaged microentrepreneurs.
    3. Federal Catalog Number: 59.049.
    4. Authority: The Program for Investment in Microentrepreneurs Act 
of 1999, ``PRIME'', P.L.106-102, 15 U.S.C. Sec. 6901 et seq.
    5. Funding Instrument: Grant.
    6. Funding: Funding is subject to the availability of funds and the 
requirements enumerated under the Act.
    7. Funding Range: Award amounts may vary, depending upon 
availability of funds (and performance for option years); however, no 
single person may receive more than $250,000 or ten (10) percent of the 
total funds made available for this program in a single fiscal year, 
whichever is less. In general, match is required, although SBA may 
reduce or eliminate the required match in certain circumstances (up to 
a program limit of 10 percent).
    8. Number of Awards: SBA anticipates issuing multiple awards under 
this Announcement. The number may vary, based on the needs of the pool 
of qualified applicants received and the amount of available funds.
    9. Targeted assistance: A minimum of 50% of the funds available for 
grants under the PRIME Act must be used to benefit very low income 
persons (as defined in this document), including those residing on 
Indian reservations.
    10. Closing Time and Date for the Submission of Applications: 
____________ at 4:00 P.M. Eastern Daylight Time.
    11. Project Starting Date:____________ (estimated).
    12. Project Duration: The period performance for this grant is one 
base year with four (4) twelve-month options subject to availability of 
funds and continued program authorization. The total possible period of 
performance is five years. Each option year will constitute a separate 
budget period. The project recipient's satisfactory performance will be 
one of the key factors in determining the award of an option year. 
Failure to secure the required annual non-Federal contribution during 
any project year may jeopardize continued option year funding.
    13. Proposal Evaluation: Applications will first be screened to 
determine if the applicant meets certain mandatory eligibility 
requirements. Applicants that do not document in their application that 
they meet these requirements will not be evaluated by SBA for 
participation in the Prime Program. In addition, applications that are 
incomplete, illegible, or unreadable, in whole or in part, will be 
deemed incomplete and will not be evaluated.

[[Page 60284]]

    Eligible proposals will be scored by an Objective Review Committee 
(ORC) based on evaluation criteria stated in this program announcement. 
The ORC will consist of SBA officials and may include Federal Officials 
from other agencies. Microenterprise Development Branch staff will 
review the ORC evaluations, the ORC's summary report on each applicant, 
and the applicant's proposals to determine the final scoring of award 
recipients. SBA may ask applicants for clarification on the technical 
and cost aspects of the proposals. Such clarifications must not be 
construed as a commitment to fund the proposed effort.
    14. Points of Contact: Questions concerning the technical aspects 
of this Program Announcement should be directed to the Microenterprise 
Development Branch at (202) 205-7534. However, due to the competitive 
process, SBA will be unable to assist with answers to specific 
questions regarding individual proposals or requests for assistance in 
completing proposals. Questions concerning budget or funding of this 
Grant should be directed to Mina Bookhard at (202) 205-6621.
    15. Award Notification: All applicants will receive a written 
notification relative to selection of award recipients. This written 
notice will be SBA's final response to this program announcement. SBA 
will not provide debriefing sessions if your proposal was not 
successful.
    16. Cancellation: SBA reserves the right to cancel this Program 
Announcement in whole or in part at the Agency's discretion.

IV. Eligible Applicants for This Grant

    An organization will be considered eligible for funding for 
research and development of best practices in the field of 
microenterprise and technical assistance programs for disadvantaged 
microentrepreneurs if it meets the following eligibility criteria:
    1. A microenterprise development organization or program (or group 
or collaborative thereof) that has a demonstrated record of delivering 
microenterprise services to disadvantaged entrepreneurs, OR
    2. An intermediary (as defined in this document) which has 
experience in delivering technical assistance to disadvantaged 
entrepreneurs, OR
    3. A microenterprise development organization or program (as 
defined in this document) that is accountable to a local community, 
working in conjunction with a State or local government or Indian 
tribe, OR
    4. An Indian tribe acting on its own, if the Indian tribe can 
certify that no private organization or program referred to in this 
paragraph exists within its jurisdiction.
    An eligible applicant for the PRIME research and development grant 
must provide documentation in its application that it falls within one 
of the above categories of qualified organizations. Such documentation 
should include but is not limited to:
    1. A copy of your organization's IRS tax-exempt certificate 
including the IRS code under which your organization is considered non-
profit;
    2. Certification by your Secretary of State that your organization 
is legally allowed to do business in the State and a copy of your 
organization's articles of incorporation and by-laws;
    3. For category 4 in the preceding paragraph, written certification 
from a duly authorized person that no other qualified organization 
(i.e. private organization or program as defined in categories 1-3 
above) exists within its jurisdiction; and
    4. Financial statements for the past 3 years. If your organization 
has been in business for less than 3 years provide your year end 
financial statements for those years completed and a financial 
statement not less than 90 days old.
    SBA will not evaluate applications that do not meet these 
requirements. SBA may not screen applicants for eligibility until after 
the Closing Date for application acceptance. SBA will attempt to notify 
applicants of ineligible proposals as soon as practicable. However, SBA 
is under no obligation to notify ineligible applicants before the 
Closing Date for the acceptance of applications under this Program 
Announcement. SBA strongly urges all applicants to ensure all 
eligibility requirements are met and documented before sending an 
application to SBA.

V. Ineligible Applicants for This Grant

    The following applicants will automatically be considered 
ineligible and their applications will not be evaluated:
    1. Any organization with an unresolved audit by any Federal agency.
    2. Any organization suspended or debarred from receiving grants 
from any Federal agency or is otherwise excluded from Federal non-
procurement or procurement programs.
    3. Any organization which has defaulted on an obligation to the 
United States.

VI. General Information

1. Definitions

    Throughout this program announcement specific terminology may be 
used, as defined in the Act and the accompanying rule (13 CFR part 119) 
published on ______. The definitions are contained in a glossary of 
terms located at the end of this document in Section XV.

2. Collaborative Applications

    a. If you participate in a collaborative (as defined in this 
document), all entities who are party to the collaborative must 
separately meet the statutory requirements and eligibility requirements 
in order to apply as a collaborative.
    b. Applications from collaboratives must name the primary liaison 
with the Federal government, and include a copy of the collaborative 
agreement outlining responsibilities of each partner organization. An 
authorized signature from each organization must appear on the 
agreement. The primary liaison will be responsible for coordinated 
reporting and requests for funding.

3. Program Income

    All program income as defined in OMB Circular A-110, and OMB A-122 
shall be reported on financial reports submitted to SBA and added to 
funds committed to the project by SBA and recipient organizations. 
Program income may only be used to further eligible program objectives.

4. Cost Principles

    a. General: All costs approved for a successful applicant must meet 
the tests of necessity, reasonableness, allowability and allocability 
in accordance with the cost principles applicable to this award. All 
proposed costs are subject to pre-award audit. Grantees are responsible 
to ensure proper management and financial accountability of Federal 
funds to preclude future cost disallowances. Payment will be made by 
reimbursement or advance payments as described in the grant award 
document and applicable OMB Circulars.
    b. Carryover Policy: The grantee may request approval to use 
unexpended funds in the next budget period. This is permissible if 
funds are to be used for a non-severable, non-recurring project or 
activity within the scope of the PRIME program. Non-severable means a 
project in its entirety that cannot be subdivided.
    The request for using unexpended funds in the next budget period 
must include the following:

[[Page 60285]]

    (1) SF 424, budget pages, and justification;
    (2) Explanation of why the funds were not expended during the 
period in which they were awarded; and
    (3) Evidence of match. The match requirement for funds carried over 
to the next budget period can be met by using any excess of matching 
funds from the current budget period, new matching funds, or a 
combination of both.
    The request must be made no later than 60 days before the end of 
the budget/project period or the de-obligation process will begin. 
Approved requests will require the issuance of a revised Notice of 
Award. Expenditures for funds carried over to the next budget period 
must be tracked separately.

5. Publications/Websites

    Any publications or websites developed under this grant must be 
submitted to SBA for prior review and approval. SBA will have an 
unlimited license to use data and written materials generated under 
this grant award, whether or not the materials are copyrighted. Any 
publications resulting from this project must include the following 
acknowledgement of support, whether copyrighted or not, in legible, 
easily readable print:

    This grant is partially funded by the U.S. Small Business 
Administration. SBA's funding is not an endorsement of any products, 
opinions, or services. All SBA funded programs are extended to the 
public on a nondiscriminatory basis.

    The grant recipient may not use the U.S. Small Business 
Administration name or logo for the endorsement of any services, 
products, or merchandise under this award.
    The SBA logo may appear on prominent webpages of Internet sites 
that are related to this project, but must appear with the above 
disclaimer in legible, easily readable print and acknowledgement of 
support in close physical proximity (within 2 inches) next to it.

6. Reports

a. General Reporting
    The selected grantees will be required to submit the reports as 
outlined below. Participants must agree to cooperate with SBA in the 
collection and retention of data required by this agency. Your ability 
to meet reporting requirements must be addressed in the Technical 
Proposal.
    Payments may be withheld if reports are not submitted within the 
required time frame or if the quality of reports is considered 
inadequate.
b. Performance Reports
    Quarterly performance reports, unless otherwise specified, must 
contain a summary of activity for the reporting period using the 
following format:
    1. A comparison of actual accomplishments to the estimated 
milestones established in the proposal and/or subsequent grant 
agreement.
    2. A discussion of accomplished milestones and reasons for slippage 
in those cases where milestones are not met. Where milestones were not 
met, a plan of action must be provided to overcome these slippages or a 
detailed statement of how the project will be improved if the 
milestones are revised.
    3. Information relating to actual financial expenditures of 
budgeted cost categories versus the estimated budget award, including 
an explanation of all cost overruns, if any, by budgeted cost category. 
Financial data furnished in this report is from a manager's standpoint 
and is in addition to that furnished in the financial reports cited 
below.
    4. Any other pertinent information, including any significant 
accomplishments or met milestones of special significance. The report 
should include items which may be determined appropriate by SBA after 
acceptance of the grant proposal but which cannot be pre-determined due 
to the undetermined special purpose of the grant at the writing of this 
document.
    Quarterly reports will be due no later than:
    (a) January 31 for the period ending December 31,
    b) April 31 for the period ending March 31,
    (c) July 31 for the period ending June 30, and
    (d) October 31 for the period ending September 30.
c. Financial Reports
    1. Financial Status Report Forms must be submitted every quarter 
with the performance reports. Reports must include the SF 269, 
Financial Status Report, and the SF 272, Federal Cash Transactions 
Report.
    2. The year-end report must include a cost breakdown of actual 
expenditures and costs incurred by line item. Participants will also be 
required to submit the SBA Form 2069, Detailed Actual Expenditures for 
Period Covered by Request, with the final SF 269.
    3. In addition, grantees will be required to submit audited annual 
financial statements, if available, or annual financial statements 
prepared by a licensed, independent public accountant, within 120 days 
of the end of the grantee's fiscal year period.
    SBA may withhold payment of advances or reimbursements if reports 
are not received or are regarded as inadequate.
    SBA may, at its discretion, reduce reporting requirements to semi-
annually as it deems appropriate. SBA will notify participants if it 
decides to take such action.

7. Match Requirements

    In general, funds awarded under the PRIME Program will require a 
non-Federal match of not less than 50% of each dollar awarded. Matching 
funds may come from fees, non-Federal grants, gifts, funds from loan 
sources, and in-kind resources. After the initial grant, grant awards 
for the following option years will be made in declining amounts, 
declining by 20% of the initial grant amount in each successive year.
    Exception: In the case of an applicant with severe constraints on 
available sources of matching funds, SBA may reduce or eliminate the 
50% match requirement on a case by case basis. Any reductions or 
eliminations must not exceed 10% of the aggregate of all PRIME grant 
funds made available by SBA in any fiscal year.
    Organizations seeking to receive a reduction or elimination of the 
matching fund requirement must include such a request (as a cover 
letter) with their proposal, and include justification and supporting 
documentation for their request. Submission of a request will not 
automatically guarantee that an exception, in whole or in part, will be 
granted. Rather, it will alert SBA to the applicant's desire to receive 
an exception.

8. Fundraising Not Allowable Expense

    Expenditures for fundraising activities are not allowable costs 
under this grant. Applicants must be able to raise matching funds 
without the assistance of grant funds. The applicant must demonstrate 
that it has adequate community based fundraising resources to obtain 
required non-Federal matching funds to perform the project.

9. Subgrants

    An organization selected to receive a grant under the PRIME Program 
may provide sub-grants to qualified small and emerging microenterprise 
development organizations. Applicants wishing to provide sub-grants as 
a part of their implementation plan should include detailed information 
regarding same in their Technical Proposal. An applicant that wants to 
make subgrants using PRIME grant funds must receive written approval 
from SBA prior to

[[Page 60286]]

making subgrants. The applicant must identify the subgrantee(s) and 
describe in detail what the subgrantee(s) will do to help the grantee 
implement its proposal.
    An applicant must submit information to SBA demonstrating that the 
subgrantee(s) will:
    (1) Further the goals of the grantee's research and development 
project, or
    (2) Provide necessary services to the grantee that grantee 
otherwise would not be able to obtain.
    If an applicant has identified potential subgrantee(s) at the time 
it submits an application for a PRIME grant, the applicant must include 
the information requested in the paragraph above in the application. 
Otherwise, the applicant or grantee may submit the requested 
information at such time that approvals for subgrantee(s) are 
requested.
    The total amount of monies subgranted by the grantee must not 
exceed 50% of the total amount of the PRIME grant. A maximum of 7.5% of 
the funds awarded may be used by the grantee for administrative 
expenses in connection with the making of subgrants.

10. Subcontracts

    Any and all subcontracts awarded under this grant must be approved 
by SBA in advance and in writing and must not exceed 50% of the total 
amount of the PRIME grant.

11. Diversity

    In making grants under this Program Announcement, SBA will ensure 
that grant recipients include both large and small microenterprise 
organizations, serving urban, rural and Indian tribal communities 
serving diverse populations.

12. Prohibition on Preferential Consideration of Certain SBA Program 
Participants

    In making grants under this Program Announcement, SBA will not give 
preferential consideration to an applicant that is a participant in the 
program established under section 7(m) of the Small Business Act.

VII. OMB Uniform Administrative Requirements And Cost Principles

    The Prime Grant Notice of Award incorporates by reference all 
applicable OMB Circulars, including:
    1. OMB Circular A-21, ``Cost Principles for Educational 
Institutions,'' containing cost principles for educational 
institutions;
    2. OMB Circular A-87 ``Cost Principles for State, Local, and Indian 
Tribal Governments,'' containing cost principles for State, local 
governments, and federally recognized Indian tribal governments.
    3. OMB Circular A-110, ``Uniform Administrative Requirements for 
Grants and Agreements with Institutions of Higher Education, Hospitals, 
and Other Non-Profit Organizations,'' containing administrative 
requirements;
    4. OMB Circular A-122, ``Cost Principles for Non-Profit 
Organizations,'' containing cost principles for non-profits; and
    5. OMB Circular A-133, ``Audits of States, Local Governments, and 
Non-Profit Organizations,'' concerning audits.
    Current versions of OMB Circulars are available from the Office of 
Management and Budget's website. The address is: www.whitehouse.gov/WH/EOP/OMB/html/circular.html.

VIII. Proposal Instructions and Evaluation Criteria

    The technical and cost proposals must be bound separately. The 
technical proposal must be single-spaced and not exceed 45 pages, 
excluding exhibits and appendices. Prepare your proposal using the 
following outline.

1. Application Format

A. Technical Proposal

Section 1. Eligibility Requirements (not to exceed 5 pages)

    In this section the applicant must prove that it falls within one 
of the four categories of qualified organizations. (See Section IV) 
Applicants are reminded to include documentation of the mandatory 
eligibility requirements in their technical narrative. Failure to 
provide the mandatory eligibility documentation will result in 
disqualification of the application, and the application will not be 
evaluated. In addition, incomplete or illegible (in whole or in part) 
applications will not be evaluated.

Section 2. Applicant Experience (not to exceed 15 pages)

    Applicant experience includes information regarding current and 
past performance in conducting research and development activities 
particularly as such activities relate to the improvement of technical 
assistance to disadvantaged entrepreneurs (as defined in this 
document). Previous work in the development of best practices in the 
field of microenterprise development should be noted in discussions of 
experience.
    In this section, the applicant should discuss the items delineated 
below. To the extent possible, the applicant should provide internal 
statistical data to document its past experience and illustrate current 
activities.
    1. Illustrate an understanding of the microenterprise industry, the 
microentrepreneurial community, the perceived needs of disadvantaged 
entrepreneurs.
    2. Enumerate and summarize your organization's current and 
historical research and development activity as it relates to 
microenterprise development and provision of technical assistance 
(particularly to disadvantaged entrepreneurs).
    3. Provide a list of grants and or contracts similar in scope to 
the grant for which you are applying. Specifically provide the name, if 
any, of any Federal or non-Federal, agency (ies) or private sector 
foundations or organizations providing funding, the grant or contract 
number, a short summary of services provided under each grant, and the 
period(s) of performance. Include in each summary the name and contact 
information (phone number and E-mail address) of the person providing 
oversight on each grant or contract. Also include abstracts of research 
and development activities conducted during the past five years, 
particularly in the field of microenterprise development and/or 
training and technical assistance to disadvantaged entrepreneurs. The 
abstracts should clearly illustrate the nature and scope of the 
research conducted. (Limit to 8 pages)

Section 3. Institutional Capacity (not to exceed 5 pages)

    This section should include the following:

1. Personnel Qualifications and Internal Structure

     Applicants must have, or demonstrate the ability to 
obtain, personnel who are qualified to meet the goals of providing 
research and development under this grant. Provide resumes of personnel 
key to your organization's participation in the PRIME Program. The 
resumes should clearly present personnel's qualifications relative to 
this particular work. Special mention should be made of relevant 
experience. Personnel indicated must demonstrate knowledge of research 
and development methodologies and strategies particularly as they 
relate to microenterprise development issues.
     Provide an organizational chart for all proposed full-time 
and part-time project staff and the amount of time each will devote to 
the project. The Project Director should be a full time

[[Page 60287]]

employee; however, the Project Director does not have to be dedicated 
solely to this activity. The project director (and other federally 
funded staff positions) must not engage in fundraising activities using 
Federal funds provided under this grant.
     A description of the role of subcontractors, subgrantees 
and/or outside consultants, that may be called upon to provide 
assistance with the completion of activity to be funded under this 
grant.
     Delineate how the organization will manage data collection 
and electronic reporting to SBA and the position of the person within 
the organization that will be responsible for financial record keeping 
pertaining to the receipt and expenditure of PRIME program funding.

2. Data Collection and Statistical Information Tracking

     Describe your organizations current data collection and 
management systems. If applying as a group or collaborative, describe 
how data management systems will be integrated for an inter-
organizational uniform approach to data gathering for reporting as well 
as production of a final product.
     Describe your organization's computer capacities, if any, 
and the software used. Indicate whether or not your organization is 
connected to the Internet and, if not, delineate plans to become 
connected. The applicant should indicate its level of willingness/ 
capability to report data via the Internet.
     Describe your organization's internal systems of checks 
and balances in terms of financial, data collection, and reporting 
systems. If applying as a group or collaborative, also describe the 
plan for inter-organizational checks and balances in terms of those 
systems. Also indicate which member of the group or collaborative will 
be responsible for coordination and submission of data and reports, and 
how the collaborative will ensure that this responsibility will be 
fully implemented.

Section 4. Program Narrative (not to exceed 15 pages)

    Research and Development projects are sought in several areas of 
microenterprise industry development. In a broad sense, several 
projects are suggested below. However, proposals for projects not 
suggested, but inside the scope of the goals of the Act, will be 
accepted for consideration. In general, research should concentrate on 
the forward movement of the disadvantaged microenterprise development 
industry. The research should also focus on the development, 
replicability, and transferability to disadvantaged microenterprise 
development service providers. The underlying theme of any activities 
should be how the final product will enhance provision of 
microenterprise services to disadvantaged entrepreneurs.
    Each applicant must provide the following:
    1. A research proposal indicating the thesis, method(s) scope, 
duration, and implementation plans (if appropriate) for the final 
product.
    2. A discussion of how the proposed research will aid in the 
development of best practices and what enhancements are anticipated, as 
a result of the proposed activity, to the delivery of microenterprise 
services to disadvantaged microentrepreneurs.
    While not limiting the scope of proposals, SBA is interested in 
developing several products for general use by industry participants as 
follows, to meet the ultimate goal of enhancing delivery of services to 
disadvantaged microentrepreneurs:
     A generally accepted baseline for minimum performance as a 
microenterprise development organization (MDO) and a standardized 
method by which neophyte, or under-performing, organizations can meet 
that baseline performance.
     A generally accepted glossary of terms for use in the 
domestic microenterprise industry which should be broad based enough to 
avoid succinct standardization, but specific enough to provide clarity 
of purpose and a common language within which industry participants can 
communicate.
     A start-up kit for organizations considering entry into 
the microenterprise development field.
     A case study oriented ``best practices'' training manual 
for use by industry participants.
     Comparative studies of service delivery issues in terms of 
geography, population density, economic stratification, gender, or 
other relevant issues.

Section 5. Timeline/Milestones (not to exceed 5 pages)

    In this section the applicant must include a timeline with 
milestones covering the 12-month grant period. Milestones should 
clearly illustrate the applicant's goals for completion of the proposed 
project and the projected use of funds.

Section 6. Supporting Documentation

    In this section the applicant should provide any necessary 
documentation to support its proposal, including but not limited to the 
following documents:
    1. A statement signed by your Executive Director (or an equivalent 
duly authorized person), authorizing SBA to make inquiries to other 
Federal Agencies as to the performance capabilities of your 
organization.
    2. A copy of your organization's IRS tax exempt certificate 
including the IRS code under which your organization is considered non-
profit.
    3. Certification by your Secretary of State that your organization 
is legally allowed to do business in the State and a copy of your 
organization's articles of incorporation and by-laws.
    4. A copy of your organization's financial statements for the last 
3 years.
    5. Resumes and reference information for personnel key to the 
delivery of technical assistance services to date.
    6. An organizational chart, if you are applying as a group, or plan 
to use sub-contractors, include a second organizational chart that 
shows how the members of the group will interact and collaborate and/or 
how the sub-contractors will fit into the work flow plan.
B. Cost Proposal
    The cost proposal must include the application cover sheet (SF 
424), budget information, and assurances and certifications. Additional 
information on how to organize the proposal is provided on page 20, 
``Preparing Your Budget.''

2. Evaluation Factors

    Applications will generally be reviewed for technical merit as 
follows:
    1. SBA will evaluate organizational structure, financial stability, 
financial management systems, personnel capacity, and electronic 
communication capabilities (or potential for same). Additional 
evaluations will be made on the data collection capabilities, reporting 
capacities, and ability to account for performance.
    2. SBA will evaluate how the research potentially will enhance 
microenterprise oriented technical assistance services to disadvantaged 
entrepreneurs. Applicants must show the method(s), scope, duration, and 
implementation plans of the proposed research.
    3. SBA will evaluate the applicant's plan of action incorporating 
original and secondary research. Applicants must show impact on 
improved access to microenterprise development services for 
disadvantaged entrepreneurs, and the expected replication/
transferability of the finished product to the field.
    Research and development awards will be competed from a single pool 
of applicants. Specifically, areas of

[[Page 60288]]

evaluation and the maximum number of points attainable under each are 
as follows:
    A. Institutional Capability (total of 90 points)
    The following factors are considered under this criteria:
    (1) Organizational structure, financial stability, and financial 
management systems (20)
    (2) Personnel (30)
    (3) Electronic communication or potential for same (20)
    (4) Data collection and reporting capability (20)
    B. Past performance and history of conducting similar research and 
development, especially related to disadvantaged microentrepreneurs (20 
points)
    C. Management Plan for Proposed Research and Development including 
transferability and replication (total of 110 points)
    The following factors are considered under this criteria:
    (1) Proposal's potential for enhancement of microenterprise 
oriented technical assistance to disadvantaged entrepreneurs (30)
    (2) Methods and scope of research (20)
    (3) Plan of action incorporating original and secondary research 
(30)
    (4) Transferability and replication of the finished product (30)
    The total number of points an applicant may attain under this 
evaluation system is 220.

IX. Option Year Funding

    Applicants shall prepare application cover sheets (SF Form 424) and 
budgets for each of the 5 budget periods consisting of 12 months each. 
Applicants are advised that the performance period for specific awards 
made under this announcement may consist of one base year with up to 4 
twelve-month option years. The project periods may consist of up to 5 
twelve-month budget periods. Each additional twelve-month budget period 
beyond the original base year may be exercised at the discretion of the 
Government. Among the factors involved in deciding whether to exercise 
an option are the availability of funds, continuing program 
authorization, satisfactory performance of the applicant, and the 
determination that continued funding would be in the best interest of 
the Government.
    After the initial grant, grant awards for the option years will be 
made in declining amounts, declining by 20 percent of the initial grant 
amount in each successive year.

X. Preparing Your Budget

INSTRUCTIONS FOR STANDARD FORM 424 (APPLICATION FOR FEDERAL ASSISTANCE)
    Standard Form 424, Application of Federal Assistance, will be found 
beginning at page A-1 of this announcement. This guidance supplements 
that contained on the reverse side of the form.

Item 1. Self-explanatory
Item 2. Refer to instructions on reverse of form
Item 3. Refer to instructions on reverse of form
Item 4. Leave Blank
Item 5. Refer to instructions on reverse of form
Item 6. Refer to instructions on reverse of form
Item 7. Refer to instructions on reverse of form
Item 8. Enter: ``new'
Item 9. Enter: ``U.S. Small Business Administration''
Item 10. Enter: 59.049 Program for Investment for Microentrepreneurs 
(PRIME)
Item 11. Refer to instructions on reverse of form
Item 12. Refer to instructions on reverse of form
Item 13. Refer to instructions on reverse of form
Item 14. Refer to instructions on reverse of form
Item 15. Refer to instructions on reverse of form
Item 16. Enter: Check ``b.'' This program is not covered by E.O. 12372.
Item 17. Refer to instructions on reverse of form
Item 18. Refer to instructions on reverse of form

INSTRUCTIONS FOR STANDARD FORM 424A (BUDGET INFORMATION)

    Budget information is found on pages A-1 through A-11
    The budget is the applicant's estimate of the total cost of 
performing the project or activity for which grant support is 
requested. The budget is to be based upon the cost of performing the 
project, including Federal and private sources. All proposed costs 
reflected in the budget must be necessary to the project, reasonable 
and otherwise allowable under applicable cost principles and Agency 
policies. All costs must be justified and itemized by unit cost on the 
Budget Worksheets (p. A-3).

Section A--Budget Summary
Column (A): Enter ``PRIME 01-3''
Column (B): Enter the Catalog of Federal Domestic Assistance Number 
59.049
Section B--Budget Categories

    Amounts entered by budget category in this section are for summary 
purposes only. Itemization and justification of specific needs by 
budget category are to be shown under line 21, Section F.
    Line 6.a.-6.h. The budget amounts must reflect the total 
requirements for funds regardless of the source of funds. All amounts 
entered in this section are to be expressed in terms of whole dollars 
only after completing the requirements of Section F.
    Line 6.j. Indirect costs are those costs related to the project 
that are not included as direct costs in a. through h.

Section C--Non-Federal Resources

    Refer to instructions on reverse of form.

Section D--Forecasted Cash Needs

    Refer to instructions on reverse of form.

Section E--Budget Estimates of Federal Funds Needed for Balance of the 
Project

    Refer to instructions on reverse of form.

Section F--Other Budget Information

    Line 21, Direct Charges: Identify and explain all items or 
categories under Section B in accordance with the instructions set 
forth below. The itemization must reflect the total requirements for 
funding from Federal and non-Federal sources. In most instances, Line 
21 does not provide sufficient space to reflect all of the necessary 
information. Budget Worksheets are enclosed for your convenience. You 
may use these worksheets for the detailed budget information listed 
below or a reasonable facsimile; BUT each budget line item pertinent to 
your submission MUST ALSO be completed on the application. Please show 
a complete breakdown of all cost elements summarized in Section B on a 
separate sheet. Do not list on Line 21 any items included in the 
indirect expenses entered on Line 22 below.
    a. Personnel: List the name, title, salary and estimated amount of 
time for each employee who will be assigned to this project. Note that 
fees, expenses, and estimated amount of time for outside consultants 
should be included in f., Contractual. The estimated performance time 
for outside consultants is not to exceed 50 percent of the total amount 
of the PRIME grant. Resumes of all personnel assigned to this effort 
must be included in the application.

[[Page 60289]]

    b. Fringe Benefits: Leave blank if fringe benefits applicable to 
direct salaries and wages are treated as part of indirect costs in the 
indirect cost rate negotiation agreement. If your organization does not 
have a federally negotiated fringe benefit package, list each component 
included as a fringe benefit.
    c. Travel: Reimbursement will be made based on incurred cost. 
Estimates should be based on knowledge of the geographical area of 
small business locations. Reimbursement to contractors or volunteers 
will not be made for time in travel to and from the client's location. 
Supporting data should include numbers of trips anticipated, costs per 
trip per person, destinations proposed, modes of transportation, and 
related subsistence expenses.
    Line 22 Indirect Charges:
    (Attach Budget Worksheets or reasonable facsimile if sufficient 
space is not provided.)
    Enter the indirect cost rate, date, and agency that issued rate.
    If an indirect cost rate is not established, itemize elements and 
costs of overhead and G&A (General and Administrative) expense 
categories relative to the performance of this project.

XI. Assembly and Mailing Instructions

    1. Please indicate the following information on the front of your 
return envelope:
    a. Your organization's name and return address including zip code 
in the upper left-hand corner of the return envelope.
    b. Place the following notation in the lower left-hand corner of 
the sealed envelope.
    THIS IS A SEALED OFFER. DO NOT OPEN. STAMP THE DATE AND TIME 
RECEIVED ON THE ENVELOPE. THIS PROPOSAL IS IN RESPONSE TO PROGRAM 
ANNOUNCEMENT NUMBER, ____________ DUE ____________, 2000, AT 4:00 P.M., 
EASTERN STANDARD TIME, AT THE U.S. SMALL BUSINESS ADMINISTRATION, 
OFFICE OF PROCUREMENT & GRANTS MANAGEMENT, 409 3RD STREET, SW, 5TH 
FLOOR, WASHINGTON, DC 20416, ATTENTION: MINA BOOKHARD.
    2. Application. Please submit an original and 2 copies of the pages 
described below in items a and b. They are part of the Announcement and 
should be completed and submitted with an original and 2 copies of your 
proposal:
    a. The Federal Assistance Application (Standard Form 424), 
including the cost and technical proposals, and related budgetary data.
    b. Appendix B, Assurances and Certifications (with appropriate 
signature).
    3. To facilitate review and processing of the proposals, your 
submission must be arranged, as follows, in two separately bound parts:
    a. Part I: COST PROPOSAL--This part is to be comprised of the 
Application, the Budget Information, and the Assurances and 
Certifications. The material identified as Part I must be bound 
separately from the Technical Proposal. DO NOT include any technical 
information in Part I, The Cost Proposal.
    b. Part II: TECHNICAL PROPOSAL--This part is comprised of the 
Program Narrative. The proposal should be completed with a table of 
contents and must be responsive to the evaluation criteria set forth on 
the pages 19-20. The Technical Proposal must be bound separately from 
Section I and must not exceed 45 pages. DO NOT include any cost 
information in Part II, The Technical Proposal.
    4. Your application should be submitted in original and 2 copies 
to: U.S. Small Business Administration, Office of Procurement and 
Grants Management, 409 Third Street, SW, 5th Floor, Washington, DC 
20416, ATTN: Mina Bookhard.

XII. Late Submission, Revisions and Withdrawals

    1. Any Application received at the Office of Procurement and Grants 
Management after the exact time specified for receipt will not be 
considered unless it is received before award is made, AND:
    a. It was sent by registered or certified U.S. mail not later than 
the fifth calendar day before the date specified for receipt of offers 
(e.g., an offer submitted in response to a solicitation requiring 
receipt of offers by the 20th of the month must have been mailed by the 
15th);
    b. It was sent by U.S. mail or hand-carried (including delivery by 
a commercial carrier) if it is determined by the Government that the 
late receipt was due primarily to Government mishandling after receipt 
at the Government installation;
    c. It was sent by U.S. Postal Service Express Mail Next Day 
Service-Post Office to Addressee, not later than 5:00 p.m. at the place 
of mailing two working days prior to the date specified for receipt of 
proposals. The term ``working days'' excludes weekends and U.S. Federal 
holidays;
    d. There is acceptable evidence to establish that it was received 
at OPGM and was under the Government's control prior to the time set 
for receipt of offers, and the Grants Management Officer determines 
that accepting the late offer would not unduly delay the grant review 
process; or
    e. It is the only proposal received.

XIII. Unsuccessful Applicants

    After a decision has been reached and if your proposal is not 
successful, you will receive written notification. This written notice 
will be SBA's final response to this program announcement. SBA will not 
provide debriefing sessions if your proposal was not successful.

XIV. Cancellation

    SBA reserves the right to cancel this announcement in whole or in 
part at the Agency's discretion.

XV. Glossary of Terms

     ADMINISTRATION: Means the U.S. Small Business 
Administration (SBA);
     ADMINISTRATOR: Means the Administrator of the Small 
Business Administration;
     CAPACITY BUILDING SERVICES: means services provided to an 
organization or program that is, or is developing as, a microenterprise 
development organization or program, for the purpose of enhancing its 
ability to provide training and services to disadvantaged 
entrepreneurs;
     COLLABORATIVE: means two or more nonprofit entities that 
agree to act jointly as a qualified organization under this part;
     DISADVANTAGED ENTREPRENEUR, or DISADVANTAGED 
MICROENTREPRENEUR: means the owner, majority owner, or developer of a 
microenterprise who is also--
    1. a low-income person
    2. a very low-income person; or
    3. an entrepreneur who lacks adequate access to capital or other 
resources essential for business success, or, is economically 
disadvantaged as determined by the Administrator.
     EMERGING MICROENTERPRISE DEVELOPMENT ORGANIZATION OR 
PROGRAM: means a microenterprise development organization or program 
which has a microenterprise capacity building services component, but 
has had such a component for less than 4 years at the date of its 
application for a PRIME grant.
     GRANTEE: means a recipient of a grant under the Act.
     GROUP: has the same meaning as ``collaborative'' defined 
above.

[[Page 60290]]

     INDIAN TRIBE: means any Indian tribe, band, pueblo, 
nation, or other organized group or community, including any Alaska 
Native village or regional or village corporation, as defined in or 
established pursuant to the Alaska Native Claims Settlement Act, which 
is recognized as eligible for the special programs and services the 
United States provides to Indians because of their status as Indians.
     INDIAN TRIBE JURISDICTION: means Indian country, as 
defined in 18 U.S.C. 1151, and any other lands, title to which is 
either held by the United States in trust for the benefit of any Indian 
tribe or individual or held by any tribe or individual subject to a 
restriction by the United States against alienation, and any land held 
by Alaska Native groups, regional corporations, and village 
corporations, as defined in or established under the Alaska Native 
Claims Settlement Act, public domain Indian allotments, and former 
Indian reservations in the State of Oklahoma.
     INTERMEDIARY: means a private, nonprofit entity that seeks 
to serve qualified microenterprise development organizations and 
programs;
     LARGE MICROENTERPRISE DEVELOPMENT ORGANIZATION OR PROGRAM: 
means a microenterprise development organization or program with 10 or 
more full time employees or equivalents, including its executive 
director, as of the date it files its application with SBA for a PRIME 
grant.
     LOCAL COMMUNITY: means an identifiable area and population 
constituting a political subdivision of a state.
     LOW-INCOME PERSON: means a person having an income, 
adjusted for family size, of not more than--
    (1) for metropolitan areas, the greater of 80 percent of the median 
income; and
    (2) for non-metropolitan areas, the greater of--
    (a) 80 percent of the area median income; or
    (b) 80 percent of the statewide non-metropolitan area median 
income;
     MICROENTREPRENEUR: means the owner or developer of a 
microenterprise;
     MICROENTERPRISE: means a sole proprietorship, partnership, 
limited liability corporation or corporation that has fewer than 5 
employees, including the owner, and generally lacks access to 
conventional loans, equity, or other banking services.
     MICROENTERPRISE DEVELOPMENT ORGANIZATION OR PROGRAM: means 
a nonprofit entity, or a program administered by such an entity, 
including community development corporations or other nonprofit 
development organizations and social service organizations, that 
provides services to disadvantaged entrepreneurs.
     QUALIFIED ORGANIZATION: means an organization eligible for 
a PRIME grant that is--
    1. A microenterprise development organization or program as defined 
above (or a group or collaborative thereof) that has demonstrated a 
record of delivering microenterprise services to disadvantaged 
microentrepreneurs;
    2. An intermediary, as defined above;
    3. A microenterprise development organization or program as defined 
above that is accountable to a local community, working with a State or 
local government or Indian tribe; or
    4. An Indian tribe acting on its own, if the Indian tribe can 
certify that no private organization referred to in this definition 
exists within its jurisdiction.
     SEVERE CONSTRAINTS ON AVAILABLE SOURCES OF MATCHING FUNDS: 
means the documented inability of a qualified organization applying for 
a PRIME grant to raise matching funds or in-kind resources from non-
Federal sources during the 2 years immediately prior to the date of its 
application because of a lack of or increased scarcity of monetary or 
in-kind resources from potential non-Federal sources.
     SMALL MICROENTERPRISE DEVELOPMENT ORGANIZATION OR PROGRAM: 
means a microenterprise development organization or program with less 
than 10 full time employees or equivalents, including its executive 
director, as of the date it files its application with SBA for a PRIME 
grant.
     TRAINING AND TECHNICAL ASSISTANCE: means services and 
support provided to disadvantaged entrepreneurs, such as assistance for 
the purpose of enhancing business planning, marketing, management, 
financial management skills, and assistance for the purpose of 
accessing financial services.
     VERY LOW INCOME PERSON: means having an income adjusted 
for family size of not more than 150 percent of the poverty line (as 
defined in Sec. 673(2) of the Community Services Block Grant Act (42 
U.S.C. Sec. 9902(2), including any revision required by that section).

XVI. Paperwork Reduction Act (44 U.S.C. Ch. 35)

    The information being requested in this Program Announcement is 
needed to evaluate applicants and ensure that awards are made in 
furtherance of the PRIME program's objectives. The information will be 
used to grant awards to provide training and technical assistance to 
disadvantaged microentrepreneurs. Applicants' responses to the data 
collection requirements are necessary for them to receive a benefit 
under the Prime Program. The information provided by applicants will be 
kept confidential to the extent required by law. Applicants are not 
required to respond to the Program Announcement unless it displays a 
currently valid OMB number. SBA estimates it will take applicants 80 
hours to respond.

XVII. Privacy Act (5 U.S.C. 552a)

    Any person can request to see or get copies of any personal 
information that SBA has in the requestor's file, when that file is 
retrieved by individual identifiers, such as name or social security 
number. Requests for information about another party may be denied 
unless SBA has the written permission of the individual to release the 
information to the requestor or unless the information is subject to 
disclosure under the Freedom of Information Act (FOIA).

    Note: Any person concerned with the collection, use and 
disclosure of information, under the Privacy Act may contact the 
Chief, Freedom of Information/Privacy Act Office, U.S. Small 
Business Administration, Suite 5900, 409 Third Street, SW, 
Washington, DC 20416, for information about the Agency's procedures 
relating to the Privacy Act and FOIA.

[FR Doc. 00-25428 Filed 10-6-00; 8:45 am]
BILLING CODE 8025-01-P