II

Calendar No. 267

106TH CONGRESS

1ST SESSION S. 1346

[Report No. 106–146]

To ensure the independence and nonpartisan operation of the Office of

Advocacy of the Small Business Administration.

IN THE SENATE OF THE UNITED STATES

JULY 12, 1999

Mr. BOND introduced the following bill; which was read twice and referred to

the Committee on Small Business

AUGUST 27, 1999

Reported under authority of the order of the Senate of August 5, 1999, by

Mr. BOND, with amendments

[Omit the part struck through and insert the part printed in italic]

A BILL

To ensure the independence and nonpartisan operation of

the Office of Advocacy of the Small Business Administration.

1 Be it enacted by the Senate and House of Representa2 tives of the United States of America in Congress assembled,

3 SECTION 1. SHORT TITLE.

4 This Act may be cited as the ‘‘Independent Office of

5 Advocacy Act’’.
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1 SEC. 2. FINDINGS.

2 Congress finds that—

3 (1) excessive regulations continue to burden our

4 Nation’s small businesses;

5 (2) Federal agencies are reluctant to comply

6 with the requirements of chapter 6 of title 5, United

7 States Code, and continue to propose regulations

8 that impose disproportionate burdens on small busi9 nesses;

10 (3) the Office of Advocacy of the Small Busi11 ness Administration (referred to in this Act as the

12 ‘‘Office’’) is an effective advocate for small busi13 nesses that can help ensure that agencies are re14 sponsive to small businesses and that agencies com15 ply with their statutory obligations under chapter 6

16 of title 5, United States Code and under the Small

17 Business Regulatory Enforcement Fairness Act of

18 1996 (Public Law 104–121; 106 Stat. 4249 et seq.);

19 (4) the independence of the Office is essential

20 to ensure that it can serve as an effective advocate

21 for small businesses without being restricted by the

22 views or policies of the Small Business Administra23 tion or any other executive branch agency;

24 (5) the Office needs sufficient resources to con25 duct the research required to assess effectively the

26 impact of regulations on small businesses; and
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1 (6) the research, information, and expertise of

2 the Office make it a valuable adviser to Congress as

3 well as the executive branch agencies with which the

4 Office works on behalf of small businesses.

5 SEC. 3. PURPOSES.

6 The purposes of this Act are—

7 (1) to ensure that the Office has the statutory

8 independence and adequate financial resources to

9 advocate for and on behalf of small business;

10 (2) to require that the Office report to the

11 Chairmen and Ranking Members of the Committees

12 on Small Business of the Senate and the House of

13 Representatives and the Administrator of the Small

14 Business Administration in order to keep them fully

15 and currently informed about issues and regulations

16 affecting small businesses and the necessity for cor17 rective action by the regulatory agency or Congress;

18 (3) to provide a separate authorization for ap19 propriations for the Office;

20 (4) to authorize the Office to report to the

21 President and to Congress regarding agency compli22 ance with chapter 6 of title 5, United States Code;

23 and

24 (5) to enhance the role of the Office pursuant

25 to chapter 6 of title 5, United States Code.
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1 SEC. 4. OFFICE OF ADVOCACY.

2 (a) IN GENERAL.—The Small Business Act (15

3 U.S.C. 631 et seq.) is amended—

4 (1) by redesignating section 32 as section 33;

5 and

6 (2) by inserting after section 31 the following:

7 ‘‘SEC. 32. OFFICE OF ADVOCACY.

8 ‘‘(a) DEFINITIONS.—In this section—

9 ‘‘(1) the term ‘Chief Counsel’ means the Chief

10 Counsel for Advocacy appointed under subsection

11 (b); and

12 ‘‘(2) the term ‘Office’ means the Office of Ad13 vocacy established under subsection (b).

14 ‘‘(b) ESTABLISHMENT.—

15 ‘‘(1) IN GENERAL.—There is established in the

16 Administration an Office of Advocacy (referred to in

17 this section as the ‘Office’).

18 ‘‘(2) CHIEF COUNSEL FOR ADVOCACY.—

19 ‘‘(A) IN GENERAL.—The management of

20 the Office shall be vested in a Chief Counsel for

21 Advocacy who shall be appointed from civilian

22 life by the President, by and with the advice

23 and consent of the Senate, without regard to

24 political affiliation and solely on the ground of

25 fitness to perform the duties of the office.
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1 ‘‘(B) EMPLOYMENT RESTRICTION.—The

2 individual appointed to the office of Chief

3 Counsel for Advocacy may not serve as an offi4 cer or employee of the Small Business Adminis5 tration during the 5-year period preceding the

6 appointment.

7 ‘‘(C) REMOVAL.—The Chief Counsel for

8 Advocacy may be removed from office by the

9 President and the President shall notify Con10 gress of any such removal within 30 days after

11 not later than 30 days before the removal.

12 ‘‘(3) APPROPRIATION REQUEST.—Each appro13 priation request prepared and submitted by the Ad14 ministration under section 1108 of title 31, United

15 States Code, shall include a separate request relat16 ing to the Office.

17 ‘‘(c) PRIMARY FUNCTIONS.—The Office shall—

18 ‘‘(1) examine the role of small businesses in the

19 economy of the United States and the contribution

20 that small businesses can make in improving com21 petition, encouraging economic and social mobility

22 for all citizens, restraining inflation, spurring pro23 duction, expanding employment opportunities, in24 creasing productivity, promoting exports, stimulating

25 innovation and entrepreneurship, and providing the
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1 means by which new and untested products and

2 services can be brought to the marketplace;

3 ‘‘(2) assess the effectiveness of Federal subsidy

4 and assistance programs for small businesses and

5 the desirability of reducing the emphasis on those

6 programs and increasing the emphasis on general

7 assistance programs designed to benefit all small

8 businesses;

9 ‘‘(3) measure the direct costs and other effects

10 of government regulation of small businesses, and

11 make legislative, regulatory, and nonlegislative pro12 posals for eliminating the excessive or unnecessary

13 regulation of small businesses;

14 ‘‘(4) determine the impact of the tax structure

15 on small businesses and make legislative, regulatory,

16 and other proposals for altering the tax structure to

17 enable all small businesses to realize their potential

18 for contributing to the improvement of the Nation’s

19 economic well-being;

20 ‘‘(5) study the ability of financial markets and

21 institutions to meet small business credit needs and

22 determine the impact of government demands on

23 credit for small businesses;

24 ‘‘(6) determine financial resource availability

25 and recommend methods for—
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1 ‘‘(A) delivery of financial assistance to mi2 nority and women-owned enterprises, including

3 methods for securing equity capital;

4 ‘‘(B) generating markets for goods and

5 services;

6 ‘‘(C) providing effective business education,

7 more effective management and technical assist8 ance, and training; and

9 ‘‘(D) assistance in complying with Federal,

10 State, and local laws;

11 ‘‘(7) evaluate the efforts of Federal agencies

12 and the private sector to assist minority and women13 owned enterprises;

14 ‘‘(8) make such recommendations as may be

15 appropriate to assist the development and strength16 ening of minority, women-owned, and other small

17 businesses;

18 ‘‘(9) recommend specific measures for creating

19 an environment in which all businesses will have the

20 opportunity to—

21 ‘‘(A) compete effectively and expand to

22 their full potential; and

23 ‘‘(B) ascertain any common reasons for

24 small business successes and failures;
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1 ‘‘(10) determine the desirability of developing a

2 set of rational, objective criteria to be used to define

3 small business, and to develop such criteria, if ap4 propriate; and

5 ‘‘(11) make recommendations and submit re6 ports to the Chairmen and Ranking Members of the

7 Committees on Small Business of the Senate and

8 the House of Representatives and the Administrator

9 with respect to issues and regulations affecting small

10 businesses and the necessity for corrective action by

11 the Administrator, any Federal department or agen12 cy, or Congress.

13 ‘‘(d) ADDITIONAL FUNCTIONS.—The Office shall, on

14 a continuing basis—

15 ‘‘(1) serve as a focal point for the receipt of

16 complaints, criticisms, and suggestions concerning

17 the policies and activities of the Administration and

18 any other department or agency of the Federal Gov19 ernment that affects small businesses;

20 ‘‘(2) counsel small businesses on the means by

21 which to resolve questions and problems concerning

22 the relationship between small businesses and the

23 Federal Government;

24 ‘‘(3) develop proposals for changes in the poli25 cies and activities of any agency of the Federal Gov-
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1 ernment that will better fulfill the purposes of this

2 section and communicate such proposals to the ap3 propriate Federal agencies;

4 ‘‘(4) represent the views and interests of small

5 businesses before other Federal agencies whose poli6 cies and activities may affect small business;

7 ‘‘(5) enlist the cooperation and assistance of

8 public and private agencies, businesses, and other

9 organizations in disseminating information about the

10 programs and services provided by the Federal Gov11 ernment that are of benefit to small businesses, and

12 information on the means by which small businesses

13 can participate in or make use of such programs and

14 services; and

15 ‘‘(6) carry out the responsibilities of the Office

16 under chapter 6 of title 5, United States Code.

17 ‘‘(e) STAFF AND POWERS.—

18 ‘‘(1) STAFF.—

19 ‘‘(A) IN GENERAL.—The Chief Counsel

20 may, without regard to the civil service laws

21 and regulations, appoint and terminate such ad22 ditional personnel as may be necessary to en23 able the Office to perform its duties under this

24 section.
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1 ‘‘(B) COMPENSATION.—The Chief Counsel

2 may fix the compensation of personnel ap3 pointed under this paragraph without regard to

4 the provisions of chapter 51 and subchapter III

5 of chapter 53 of title 5, United States Code, re6 lating to classification of positions and General

7 Schedule pay rates, but at rates not to exceed

8 the minimum rate payable for a position at GS–

9 15 of the General Schedule, except that not

10 more than 14 employees of the Office at any

11 one time may be compensated at a rate not to

12 exceed the maximum rate payable for a position

13 at GS–15 of the General Schedule.

14 ‘‘(2) POWERS.—In carrying out this section, the

15 Chief Counsel may—

16 ‘‘(A) procure temporary and intermittent

17 services to the same extent as is authorized by

18 section 3109 of title 5, United States Code;

19 ‘‘(B) consult with—

20 ‘‘(i) experts and authorities in the

21 fields of small business investment, venture

22 capital, investment and commercial bank23 ing, and other comparable financial institu24 tions involved in the financing of business;

25 and
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1 ‘‘(ii) individuals with regulatory, legal,

2 economic, or financial expertise, including

3 members of the academic community, and

4 individuals who generally represent the

5 public interest;

6 ‘‘(C) use the services of the National Advi7 sory Council established under section 8(b) and,

8 in accordance with that section, appoint such

9 other advisory boards or committees as the

10 Chief Counsel determines to be reasonably nec11 essary and appropriate to carry out this section;

12 and

13 ‘‘(D) hold hearings and sit and act at such

14 times and places as the Chief Counsel deter15 mines to be appropriate.

16 ‘‘(f) OVERHEAD AND ADMINISTRATIVE SUPPORT.—

17 The Administrator shall provide the Office with appro18 priate and adequate office space at central and field office

19 locations of the Administration, together with such equip20 ment, office supplies, and communications facilities and

21 services as may be necessary for the operation of such of22 fices, and shall provide necessary maintenance services for

23 such offices and the equipment and facilities located there24 in.
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1 ‘‘(g) INFORMATION FROM FEDERAL AGENCIES.—

2 The Chief Counsel may secure directly from any Federal

3 department or agency such information as the Chief Coun4 sel considers to be necessary to carry out this section.

5 Upon request of the Chief Counsel, the head of such de6 partment or agency shall furnish such information to the

7 Office.

8 ‘‘(h) REPORTS.—

9 ‘‘(1) ANNUAL REPORTS.—Not less than annu10 ally, the Chief Counsel shall submit to the President

11 and to the Committees on Small Business of the

12 Senate and the House of Representatives a report on

13 agency compliance with chapter 6 of title 5, United

14 States Code.

15 ‘‘(2) ADDITIONAL REPORTS.—In addition to the

16 reports required under paragraph (1) of this sub17 section and subsection (c)(12), the Chief Counsel

18 may prepare and publish such reports as the Chief

19 Counsel determines to be appropriate.

20 ‘‘(3) PROHIBITION.—No report under this sec21 tion shall be submitted to the Office of Management

22 and Budget or to any other department or agency

23 of the Federal Government for any purpose before

24 submission of the report to the President and to

25 Congress.
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1 ‘‘(i) AUTHORIZATION OF APPROPRIATIONS.—

2 ‘‘(1) IN GENERAL.—There are authorized to be

3 appropriated to the Office to carry out this section

4 such sums as may be necessary for each fiscal year.

5 ‘‘(2) AVAILABILITY.—Any sums appropriated

6 under paragraph (1) shall remain available, without

7 fiscal year limitation, until expended.’’.

8 (b) REPEAL.—Title II of Public Law 94–305 (15

9 U.S.C. 634a et seq.) is repealed.

10 (c) INCUMBENT CHIEF COUNSEL FOR ADVOCACY.—

11 The individual serving as the Chief Counsel for Advocacy

12 of the Small Business Administration on the date of enact13 ment of this Act shall continue to serve in that position

14 after such date in accordance with section 32 of the Small

15 Business Act, as amended by this section.
Calendar No. 267

106TH CONGRESS

1ST SESSION S. 1346

[Report No. 106–146]

A BILL

To ensure the independence and nonpartisan operBusiness Administration. ation of the Office of Advocacy of the Small

AUGUST 27, 1999

Reported with amendments