[108th Congress Public Law 31]
[From the U.S. Government Printing Office]


[DOCID: f:publ031.108]

[[Page 117 STAT. 775]]

Public Law 108-31
108th Congress

                                 An Act


 
   To amend the Microenterprise for Self-Reliance Act of 2000 and the 
 Foreign Assistance Act of 1961 to increase assistance for the poorest 
people in developing countries under microenterprise assistance programs 
under those Acts, and for other purposes. <<NOTE: June 17, 2003 -  [H.R. 
                                 192]>> 

    Be it enacted by the Senate and House of Representatives of the 
United States of America in Congress assembled,

SECTION 1. AMENDMENTS TO THE MICROENTERPRISE FOR SELF-RELIANCE ACT OF 
            2000.

    (a) Purposes.--Section 103 of the Microenterprise for Self-Reliance 
Act of 2000 (Public Law 106-309) is <<NOTE: 22 USC 2151f 
note.>> amended--
            (1) in paragraph (3), by striking ``microentrepreneurs'' and 
        inserting ``microenterprise households'';
            (2) in paragraph (4), by striking ``and'' at the end;
            (3) in paragraph (5)--
                    (A) by striking ``microfinance policy'' and 
                inserting ``microenterprise policy'';
                    (B) by striking ``the poorest of the poor'' and 
                inserting ``the very poor''; and
                    (C) by striking the period at the end and inserting 
                ``; and''; and
            (4) by adding at the end the following:
            ``(6) to ensure that in the implementation of this title at 
        least 50 percent of all microenterprise assistance under this 
        title, and the amendments made under this title, shall be 
        targeted to the very poor.''.

    (b) Definitions.--Section 104 of such Act is <<NOTE: 22 USC 2151f 
note.>> amended--
            (1) in paragraph (2), by striking ``for microentrepreneurs'' 
        and inserting ``to microentrepreneurs and their households''; 
        and
            (2) by adding at the end the following:
            ``(5) Very poor.--The term `very poor' means individuals--
                    ``(A) living in the bottom 50 percent below the 
                poverty line established by the national government of 
                the country in which those individuals live; or
                    ``(B) living on the equivalent of less than $1 per 
                day.''.

SEC. 2. AMENDMENTS TO THE MICRO- AND SMALL ENTERPRISE DEVELOPMENT 
            CREDITS PROGRAM UNDER THE FOREIGN ASSISTANCE ACT OF 1961.

    (a) Findings and Policy.--Section 108(a)(2) of the Foreign 
Assistance Act of 1961 (22 U.S.C. 2151f(a)(2)) is amended by striking 
``the development of the enterprises of the poor'' and inserting

[[Page 117 STAT. 776]]

``the access to financial services and the development of 
microenterprises''.
    (b) Program.--Section 108(b) of such Act (22 U.S.C. 2151f(b)) is 
amended to read as follows:
    ``(b) Program.--To carry out the policy set forth in subsection (a), 
the President is authorized to provide assistance to increase the 
availability of financial services to microenterprise households lacking 
full access to credit, including through--
            ``(1) loans and guarantees to microfinance institutions for 
        the purpose of expanding the availability of savings and credit 
        to poor and low-income households;
            ``(2) training programs for microfinance institutions in 
        order to enable them to better meet the financial services needs 
        of their clients; and
            ``(3) training programs for clients in order to enable them 
        to make better use of credit, increase their financial literacy, 
        and to better manage their enterprises to improve their quality 
        of life.''.

    (c) Eligibility Criteria.--Section 108(c) of such Act (22 U.S.C. 
2151f(c)) is amended--
            (1) in the first sentence of the matter preceding paragraph 
        (1)--
                    (A) by striking ``credit institutions'' and 
                inserting ``microfinance institutions''; and
                    (B) by striking ``micro- and small enterprises'' and 
                inserting ``microenterprise households''; and
            (2) in paragraphs (1) and (2), by striking ``credit'' each 
        place it appears and inserting ``financial services''.

    (d) Additional Requirement.--Section 108(d) of such Act (22 U.S.C. 
2151f(d)) is amended by striking ``micro- and small enterprise 
programs'' and inserting ``programs for microenterprise households''.
    (e) Availability of Funds.--Section 108(f)(1) of such Act (22 U.S.C. 
2151f(f)(1)) is amended by striking ``for each of fiscal years 2001 and 
2002'' and inserting ``for each of fiscal years 2001 through 2004''.
    (f) Conforming Amendment.--Section 108 of such Act (22 U.S.C. 2151f) 
is amended in the heading to read as follows:

``SEC. 108. MICROENTERPRISE DEVELOPMENT CREDITS.''.

SEC. 3. AMENDMENTS TO THE MICROENTERPRISE DEVELOPMENT GRANT ASSISTANCE 
            PROGRAM UNDER THE FOREIGN ASSISTANCE ACT OF 1961.

    (a) Findings and Policy.--Section 131(a) of the Foreign Assistance 
Act of 1961 (22 U.S.C. 2152a(a)) is amended to read as follows:
    ``(a) Findings and Policy.--Congress finds and declares that--
            ``(1) access to financial services and the development of 
        microenterprise are vital factors in the stable growth of 
        developing countries and in the development of free, open, and 
        equitable international economic systems;
            ``(2) it is therefore in the best interest of the United 
        States to facilitate access to financial services and assist the 
        development of microenterprise in developing countries;
            ``(3) access to financial services and the development of 
        microenterprises can be supported by programs providing credit, 
        savings, training, technical assistance, business development 
        services, and other financial and non-financial services; and

[[Page 117 STAT. 777]]

            ``(4) given the relatively high percentage of populations 
        living in rural areas of developing countries, and the combined 
        high incidence of poverty in rural areas and growing income 
        inequality between rural and urban markets, microenterprise 
        programs should target both rural and urban poor.''.

    (b) Authorization.--Section 131(b) of such Act (22 U.S.C. 2152a(b)) 
is amended--
            (1) in paragraph (3)(A)(i), by striking ``entrepreneurs'' 
        and inserting ``clients''; and
            (2) in paragraph (4)(D)--
                    (A) in clause (i), by striking ``very small loans'' 
                and inserting ``financial services to poor 
                entrepreneurs''; and
                    (B) in clause (ii), by striking ``microfinance'' and 
                inserting ``microenterprise''.

    (c) Monitoring System.--Section 131(c) of such Act (22 U.S.C. 
2152a(c)) is amended by striking paragraph (4) and inserting the 
following:
            ``(4) adopts the widespread use of proven and effective 
        poverty assessment tools to successfully identify the very poor 
        and ensure that they receive needed microenterprise loans, 
        savings, and assistance.''.

    (d) Development and Application of Poverty Measurement Methods.--
Section 131 of such Act (22 U.S.C. 2152a) is amended--
            (1) by redesignating subsections (d) and (e) as subsections 
        (e) and (f), respectively; and
            (2) by inserting after subsection (c) the following:

    ``(d) Development and Certification of Poverty Measurement Methods; 
Application of Methods.--
            ``(1) Development and certification.--(A) The Administrator 
        of the United States Agency for International Development, in 
        consultation with microenterprise institutions and other 
        appropriate organizations, shall develop no fewer than two low-
        cost methods for partner institutions to use to assess the 
        poverty levels of their current or prospective clients. The 
        United States Agency for International Development shall develop 
        poverty indicators that correlate with the circumstances of the 
        very poor.
            ``(B) The Administrator shall field-test the methods 
        developed under subparagraph (A). As part of the testing, 
        institutions and programs may use the methods on a voluntary 
        basis to demonstrate their ability to reach the very poor.
            ``(C) <<NOTE: Deadline.>> Not later than October 1, 2004, 
        the Administrator shall, from among the low-cost poverty 
        measurement methods developed under subparagraph (A), certify no 
        fewer than two such methods as approved methods for measuring 
        the poverty levels of current or prospective clients of 
        microenterprise institutions for purposes of assistance under 
        this section.
            ``(2) <<NOTE: Deadline.>> Application.--The Administrator 
        shall require that, with reasonable exceptions, all 
        organizations applying for microenterprise assistance under this 
        Act use one of the certified methods, beginning no later than 
        October 1, 2005, to determine and report the poverty levels of 
        current or prospective clients.''.

    (e) Level of Assistance.--Section 131(e) of such Act, as 
redesignated by subsection (d), is amended by inserting ``and 
$175,000,000 for fiscal year 2003 and $200,000,000 for fiscal year 
2004'' after ``fiscal years 2001 and 2002''.

[[Page 117 STAT. 778]]

    (f) Definitions.--Section 131(f) of such Act, as redesignated by 
subsection (d), is amended by adding at the end the following:
            ``(5) Very poor.--The term `very poor' means those 
        individuals--
                    ``(A) living in the bottom 50 percent below the 
                poverty line established by the national government of 
                the country in which those individuals live; or
                    ``(B) living on less than the equivalent of $1 per 
                day.''.

SEC. 4. REPORT TO <<NOTE: 22 USC 2151f note.>> CONGRESS.

    (a) <<NOTE: Deadline.>> In General.--Not later than September 30, 
2005, the Administrator of the United States Agency for International 
Development shall submit to Congress a report that documents the process 
of developing and applying poverty assessment procedures with its 
partners.

    (b) Reports for Fiscal Year 2006 and Beyond.--Beginning with fiscal 
year 2006, the Administrator of the United States Agency for 
International Development shall annually submit to Congress on a timely 
basis a report that addresses the United States Agency for International 
Development's compliance with the Microenterprise for Self-Reliance Act 
of 2000 by documenting--
            (1) the percentage of its resources that were allocated to 
        the very poor (as defined in paragraph (5) of section 131(f) of 
        the Foreign Assistance Act of 1961 (22 U.S.C. 2152a(f)(5))) 
        based on the data collected from its partners using the 
        certified methods; and
            (2) the absolute number of the very poor reached.

    Approved June 17, 2003.

LEGISLATIVE HISTORY--H.R. 192:
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CONGRESSIONAL RECORD, Vol. 149 (2003):
            May 14, considered and passed House.
            May 23, considered and passed Senate.

                                  <all>