I 

109TH CONGRESS 

1ST SESSION H. R. 3207

To direct the Administrator of the Small Business Administration to establish 

a pilot program to make grants to eligible entities for the development 

of peer learning opportunities for second-stage small business concerns. 

IN THE HOUSE OF REPRESENTATIVES 

JULY 12, 2005

Mr. FITZPATRICK of Pennsylvania introduced the following bill; which was 

referred to the Committee on Small Business 

A BILL

To direct the Administrator of the Small Business Administration to establish a pilot program to make grants to 

eligible entities for the development of peer learning opportunities for second-stage small business concerns.

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 ‘‘Second-Stage Small 

5 Business Development Act of 2005’’. 

6 SEC. 2. PURPOSE. 

7 The purpose of this Act is to establish a four-year 

8 pilot program to—
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1 (1) identify second-stage small business con2 cerns that have the capacity for significant business 

3 growth and job creation; 

4 (2) facilitate business growth and job creation 

5 by second-stage small business concerns through the 

6 development of peer learning opportunities; and 

7 (3) utilize the network of small business devel8 opment centers to expand access to peer learning op9 portunities for second-stage small business concerns. 

10 SEC. 3. PILOT PROGRAM. 

11 (a) ESTABLISHMENT.—The Administrator shall es12 tablish and carry out a pilot program (referred to in this 

13 Act as the ‘‘pilot program’’) to make grants to eligible en14 tities for the development of peer learning opportunities 

15 for second-stage small business concerns in accordance 

16 with this Act. 

17 (b) SELECTION OF GRANT RECIPIENTS.—

18 (1) IN GENERAL.—From the eligible entities lo19 cated in the States in each of the 10 regions under 

20 paragraph (3), the Administrator shall select 2 eligi21 ble entities to receive grants. 

22 (2) ELIGIBLE ENTITIES.—In this Act, the term 

23 ‘‘eligible entity’’ means an entity that—
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1 (A) is eligible to receive funding under sec2 tion 21 of the Small Business Act (15 U.S.C. 

3 648); and 

4 (B) submits to the Secretary an applica5 tion that includes—

6 (i) a plan to—

7 (I) offer peer learning opportuni8 ties to second-stage small business 

9 concerns; and 

10 (II) transition to providing such 

11 opportunities using non-governmental 

12 funding; and 

13 (ii) any other information and assur14 ances that the Secretary may require. 

15 (3) CRITERIA FOR SELECTION.— The Adminis16 trator shall evaluate the plans submitted by the eli17 gible entities under paragraph (2) and select eligible 

18 entities to receive grants on the basis of the merit 

19 of such plans. 

20 (4) REGIONS DESCRIBED.—The regions re21 ferred to in paragraph (1) are as follows: 

22 (A) REGION 1.—Maine, Massachusetts, 

23 New Hampshire, Connecticut, Vermont, and 

24 Rhode Island. 
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1 (B) REGION 2.—New York, New Jersey, 

2 Puerto Rico, and the Virgin Islands. 

3 (C) REGION 3.— Pennsylvania, Maryland, 

4 West Virginia, Virginia, the District of Colum5 bia, and Delaware. 

6 (D) REGION 4.—Georgia, Alabama, North 

7 Carolina, South Carolina, Mississippi, Florida, 

8 Kentucky, and Tennessee. 

9 (E) REGION 5.—Illinois, Ohio, Michigan, 

10 Indiana, Wisconsin, and Minnesota. 

11 (F) REGION 6.—Texas, New Mexico, Ar12 kansas, Oklahoma, and Louisiana. 

13 (G) REGION 7.—Missouri, Iowa, Nebraska, 

14 and Kansas. 

15 (H) REGION 8.—Colorado, Wyoming, 

16 North Dakota, South Dakota, Montana, and 

17 Utah. 

18 (I) REGION 9.—California, Guam, Hawaii, 

19 Nevada, Arizona, and American Samoa. 

20 (J) REGION 10.—Washington, Alaska, 

21 Idaho, and Oregon. 

22 (5) CONSULTATION.—If small business develop23 ment centers have formed an association to pursue 

24 matters of common concern as authorized under sec25 tion 21(a)(3)(A) of the Small Business Act (15 
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1 U.S.C. 648(a)(3)(A)), the Administrator shall con2 sult with such association and give substantial 

3 weight to the recommendations of such association 

4 in selecting the grant recipients. 

5 (6) DEADLINE FOR INITIAL SELECTIONS.—The 

6 Administrator shall make selections under paragraph 

7 (1) not later than 60 days after the promulgation of 

8 regulations under section 4. 

9 (c) USE OF FUNDS.—An eligible entity that receives 

10 a grant under the pilot program shall use the grant to—

11 (1) identify second-stage small business con12 cerns in the service delivery areas of the eligible enti13 ty; and 

14 (2) establish and conduct peer learning oppor15 tunities for such second-stage small business con16 cerns. 

17 (d) AMOUNT OF GRANT.—

18 (1) IN GENERAL.—Except as provided in para19 graph (2), a grant under the pilot program shall be 

20 in an amount that does not exceed the product ob21 tained by multiplying— 

22 (A) the amount made available for grants 

23 under the pilot program for the fiscal year for 

24 which the grant is made; and 
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1 (B) the ratio that the population of the 

2 State in which the eligible entity is located 

3 bears to the aggregate population the States in 

4 which eligible entities receiving grants for that 

5 fiscal year are located. 

6 (2) MINIMUM AMOUNT OF GRANT.—A grant 

7 under the pilot program shall be in an amount not 

8 less than $50,000. 

9 (e) MATCHING REQUIREMENT.—As a condition of a 

10 grant under the pilot program, the Administrator shall re11 quire that a matching amount be provided from sources 

12 other than the Federal Government that—

13 (1) is equal to the amount of the grant; 

14 (2) is not less than 50 percent cash; 

15 (3) is not more than 50 percent comprised of 

16 indirect costs and in-kind contributions; and 

17 (4) does not include any indirect cost or in-kind 

18 contribution derived from any Federal program 

19 (f) QUARTERLY REPORT TO ADMINISTRATOR.—

20 (1) IN GENERAL.—Each eligible entity that re21 ceives a grant under the pilot program shall submit 

22 to the Administrator a quarterly report that in23 cludes—
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1 (A) a summary of the peer learning oppor2 tunities established by the eligible entity using 

3 grant funds; 

4 (B) the number of second-stage small busi5 ness concerns assisted using grant funds; and 

6 (C) in the case of an eligible entity that re7 ceives a grant for a second fiscal year or any 

8 subsequent fiscal year—

9 (i) any measurable economic impact 

10 data resulting from the peer learning op11 portunities established using grant funds; 

12 and 

13 (ii) the number of peer learning op14 portunities established by the eligible enti15 ty that have transitioned from operating 

16 using Government funds to operating with17 out using Government funds. 

18 (2) FORM OF REPORT.—The report required 

19 under paragraph (1) shall be transmitted in elec20 tronic form. 

21 (g) DATA REPOSITORY AND CLEARINGHOUSE.—In 

22 carrying out the pilot program, the Administrator shall act 

23 as the repository of and clearinghouse for data and infor24 mation submitted by the eligible entities. 
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1 (h) ANNUAL REPORT ON PILOT PROGRAM.—Not 

2 later than November 1 of each year, the Administrator 

3 shall submit to the President and to Congress, a report 

4 evaluating the success of the pilot program during the pre5 ceding fiscal year, which shall include the following: 

6 (1) A description of the types of peer learning 

7 opportunities provided with grant funds. 

8 (2) The number of second-stage small business 

9 concerns assisted with grant funds. 

10 (3) For fiscal year 2007 and each subsequent 

11 fiscal year of the pilot program—

12 (A) data regarding the economic impact of 

13 the peer learning opportunities provided with 

14 grant funds; and 

15 (B) the number of peer learning opportuni16 ties established by grant recipients that have 

17 transitioned from operating using Government 

18 funds to operating without using Government 

19 funds. 

20 (i) PRIVACY REQUIREMENT.—

21 (1) IN GENERAL.—A small business develop22 ment center, consortium of small business develop23 ment centers, or contractor or agent of a small busi24 ness development center shall not disclose the name, 

25 address, or telephone number of any individual or 
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1 small business concern receiving assistance under 

2 this section without the consent of such individual or 

3 small business concern, unless—

4 (A) the Administrator is ordered to make 

5 such a disclosure by a court in any civil or 

6 criminal enforcement action initiated by a Fed7 eral or State agency; or 

8 (B) the Administrator considers such a 

9 disclosure to be necessary for the purpose of 

10 conducting a financial audit of a small business 

11 development center, but a disclosure under this 

12 subparagraph shall be limited to the informa13 tion necessary for such audit. 

14 (2) ADMINISTRATOR USE OF INFORMATION.—

15 The privacy requirement under this subsection shall 

16 not—

17 (A) restrict Administrator access to pro18 gram activity data; or 

19 (B) prevent the Administrator from using 

20 client information to conduct client surveys. 

21 (j) EVALUATION AND REPORT.—Not later than 3 

22 years after the establishment of the pilot program, the 

23 Comptroller General of the United States shall—

24 (1) conduct an evaluation of the pilot program; 

25 and 
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1 (2) transmit to Congress and the Administrator 

2 a report containing the results of such evaluation 

3 along with any recommendations as to whether the 

4 pilot program, with or without modification, should 

5 be extended to include the participation of all small 

6 business development centers. 

7 (k) TERMINATION.—The pilot program shall termi8 nate on September 30, 2009. 

9 SEC. 4. REGULATIONS. 

10 After providing notice and an opportunity for com11 ment and after consulting with the association described 

12 in section 3(b)(5) (if any such association has been 

13 formed), the Administrator shall promulgate final regula14 tions to carry out this Act, including regulations that es15 tablish—

16 (1) standards relating to the establishment and 

17 conduct of peer learning opportunities to be provided 

18 by grant recipients, including the number of individ19 uals that may participate in a peer group that is 

20 part of a peer learning opportunity; 

21 (2) standards relating to the educational, tech22 nical, and professional competency of any facilitator 

23 who delivers peer learning opportunities under the 

24 pilot program; and 
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1 (3) requirements for transitioning peer learning 

2 opportunities funded under the pilot program to 

3 non-governmental funding. 

4 SEC. 5. DEFINITIONS. 

5 In this Act: 

6 (1) The term ‘‘Administrator’’ means the Ad7 ministrator of the Small Business Administration. 

8 (2) The term ‘‘peer learning opportunities’’ 

9 means formally organized peer groups of owners, 

10 presidents and chief executive officers in non-com11 peting second-stage business concerns, meeting regu12 larly with a professionally trained facilitator. 

13 (3) The term ‘‘second-stage small business con14 cern’’ means a small business concern that— 

15 (A) has—

16 (i) more than 6 and not more than 99 

17 employees; or 

18 (ii) annual revenue or working capital 

19 or more than $750,000 and not more than 

20 $18,000,000; and 

21 (B) has experienced high growth dem22 onstrated by—

23 (i) an average annual revenue or em24 ployee growth rate of at least 15 percent 

25 during the preceding 3 years; or 
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1 (ii) any 3 of the following: 

2 (I) Owning proprietary intellec3 tual property. 

4 (II) Addressing an underserved 

5 or growing market. 

6 (III) Having a sustainable com7 petitive advantage. 

8 (IV) Exporting goods or services 

9 outside of its community. 

10 (V) Having a product or service 

11 that is scalable to a large market. 

12 (4) The term ‘‘small business concern’’ has the 

13 meaning given that term under section 3 of the 

14 Small Business Act (15 U.S.C. 632). 

15 (5) The term ‘‘State’’ means each of the several 

16 States, the District of Columbia, the Commonwealth 

17 of Puerto Rico, the Virgin Islands, Guam, and 

18 American Samoa. 

19 SEC. 6. AUTHORIZATION OF APPROPRIATIONS. 

20 (a) IN GENERAL.—There is authorized to be appro21 priated to carry out this Act $1,500,000 for each of fiscal 

22 years 2006 through 2009. 

23 (b) LIMITATION ON USE OF OTHER FUNDS.—The 

24 Administrator shall carry out this Act using only amounts 
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1 appropriated in advance specifically for the purpose of car2 rying out this Act.

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