Welfare-to-Work Microloan Pilot Program Act of 1997

SECTION 101. SHORT TITLE.

    This Act may be cited as the ``Welfare-to-Work Microloan Pilot 
Program Act of 1997''.

SEC. 102. FINDINGS.

    Congress finds that--
            (1) the microloan demonstration program of the Small 
        Business Administration, established under section 7(m) of the 
        Small Business Act (15 U.S.C. 636(m)), has been a successful 
        method of assisting women, low-income and minority 
        entrepreneurs and business owners, and others by providing 
        access to small-scale loans and technical assistance, which 
        enables these individuals to operate successful business 
        concerns;
            (2) some welfare recipients who become borrowers under the 
        microloan demonstration program have been able to eliminate 
        their dependence on welfare and operate successful business 
        concerns as a result of assistance received through the 
        microloan demonstration program;
            (3) welfare recipients who become borrowers under the 
        microloan demonstration program often require more intensive 
        management, marketing, and technical assistance than other 
        borrowers under that program; and
            (4) the lack of affordable or available child care and 
        transportation is often a barrier to individuals wishing to 
        eliminate their dependence on welfare and establish a small 
        business.

SEC. 103. WELFARE-TO-WORK MICROLOAN PILOT PROGRAM.

    (a) Establishment.--Section 7(m) of the Small Business Act (15 
U.S.C. 636(m)) is amended--
            (1) in paragraph (1)(A)--
                    (A) in clause (ii), by striking ``and'' at the end;
                    (B) in clause (iii), by striking the period at the 
                end and inserting ``; and''; and
                    (C) by adding at the end the following:
                            ``(iv) to establish a welfare-to-work 
                        microloan pilot program, which shall be 
                        administered by the Administration, in order 
                        to--
                                    ``(I) test the feasibility of 
                                increasing the dollar amount of 
                                technical assistance grants provided 
                                under clauses (ii) and (iii) of 
                                subparagraph (B) to individuals who are 
                                receiving assistance under the State 
                                program funded under part A of title IV 
                                of the Social Security Act (42 U.S.C. 
                                601 et seq.), or under any comparable 
                                State-funded means-tested program of 
                                assistance for low-income individuals, 
                                in order to adequately assist those 
                                individuals in--
                                            ``(aa) establishing small 
                                        businesses; and
                                            ``(bb) eliminating their 
                                        dependence on that assistance;
                                    ``(II) permit the increased 
                                technical assistance grants described 
                                in subclause (I) to be used to 
                                subsidize child care and transportation 
                                costs of individuals described in 
                                subclause (I) who become 
                                microborrowers;
                                    ``(III) eliminate barriers to 
                                microborrowers in establishing child 
                                care businesses; and
                                    ``(IV) evaluate the effectiveness 
                                of assistance provided under this 
                                clause in helping individuals described 
                                in subclause (I) to eliminate their 
                                dependence on assistance described in 
                                that subclause and become employed 
                                either in their own business or in 
                                another business.'';
            (2) in paragraph (4), by adding at the end the following:
                    ``(F) Supplemental grants.--
                            ``(i) In general.--In addition to grants 
                        under subparagraphs (A) and (C) and paragraph 
                        (5), the Administration may select from 
                        participating intermediaries and grant 
                        recipients not more than 30 entities, each of 
                        whom may receive annually a supplemental grant 
                        in an amount not to exceed $500,000 for the 
                        purpose of providing additional technical 
                        assistance to borrowers or prospective 
                        borrowers who are receiving assistance 
                        described in paragraph (1)(A)(iv)(I) at the 
                        time they initially apply for assistance under 
                        the program.
                            ``(ii) Inapplicability of contribution 
                        requirements.--The contribution requirements of 
                        subparagraphs (B) and (C)(i)(II) do not apply 
                        to any grant made under this subparagraph.
                            ``(iii) Childcare and transportation 
                        costs.--Any grant made under this subparagraph 
                        may be used to defray the costs of child care 
                        and transportation incurred by a borrower or 
                        potential borrower under the welfare-to-work 
                        microloan pilot program under paragraph 
                        (1)(A)(iv).'';
            (3) in paragraph (6), by adding at the end the following:
                    ``(E) Establishment of child care establishments.--
                In addition to small business concerns, borrowers under 
                any program under this subsection may include 
                individuals who will use the loan proceeds to establish 
                for-profit or nonprofit child care or elder care 
                establishments.'';
            (4) in paragraph (9)--
                    (A) in the subparagraph heading, by striking ``for 
                intermediaries''; and
                    (B) by adding at the end the following:
                    ``(C) Welfare-to-work microloan pilot program.--Of 
                amounts made available to carry out the welfare-to-work 
                microloan pilot program under paragraph (1)(A)(iv) in 
                any fiscal year, the Administration may use not more 
                than 5 percent to provide technical assistance, either 
                directly or through contractors, to welfare-to-work 
                microloan pilot program grantees, or to those seeking 
                to become grantees, to ensure that, as grantees, they 
                have the knowledge, skills, and understanding of 
                microlending and welfare-to-work transition, and other 
                related issues, to operate a successful welfare-to-work 
                microloan pilot program.''; and
            (5) by adding at the end the following:
            ``(13) Evaluation of welfare-to-work microloan pilot 
        program.--On January 31, 1999, and annually thereafter, the 
        Administration shall submit to the Committees on Small Business 
        of the Senate and the House of Representatives a report on the 
        welfare-to-work microloan pilot program authorized under 
        paragraph (1)(A)(iv), which report shall include, with respect 
        to the preceding fiscal year, an analysis of the progress and 
        effectiveness of the program during that fiscal year, and data 
        relating to--
                    ``(A) the number and location of each grantee under 
                the program;
                    ``(B) the amount of each grant;
                    ``(C) the number of individuals who received 
                assistance under each grant, including separate data 
                relating to--
                            ``(i) the number of individuals who 
                        received training;
                            ``(ii) the number of individuals who 
                        received transportation assistance; and
                            ``(iii) the number of individuals who 
                        received childcare assistance (including the 
                        number of children assisted);
                    ``(D) the type and amount of loan and grant 
                assistance received by borrowers and prospective 
                borrowers under the program;
                    ``(E) the number of businesses that were started 
                with assistance provided under the program that are 
                operational and the number of jobs created by each 
                business;
                    ``(F) the number of individuals receiving training 
                under the program who, after receiving assistance under 
                the program--
                            ``(i) are employed in their own businesses;
                            ``(ii) are employed in a business other 
                        than their own;
                            ``(iii) are not employed; or
                            ``(iv) are receiving public assistance for 
                        themselves or their children.
                    ``(G) whether and to what extent each grant was 
                used to defray the transportation and child care costs 
                of borrowers; and
                    ``(H) any recommendations for legislative changes 
                to improve program operations.''.
    (b) Authorization of Appropriations.--There are authorized to be 
appropriated to carry out the welfare-to-work microloan pilot program 
under section 7(m)(1)(A)(iv) of the Small Business Act (15 U.S.C. 
636(m)(1)(A)(iv)), as added by this section, $10,000,000 for each of 
fiscal years 1998, 1999, and 2000.

Summary: Welfare-to-Work Microloan Pilot Program Act of 1997 - Amends the Small Business Act to establish under the Microloan Demonstration Program a welfare-to-work microloan pilot program which increases the technical assistance grants provided to individuals receiving assistance under part A of title IV of the Social Security Act or other comparable State-funded programs in order to assist such individuals in establishing small businesses and eliminating their dependence on such assistance. Allows such grants to be used to subsidize child care and transportation costs or to establish child or elder care centers. Directs the Small Business Administration to report annually to the small business committees on such pilot program. Authorizes appropriations for FY 1998 through 2000.