39–006 

113TH CONGRESS REPORT " ! HOUSE OF REPRESENTATIVES 2d Session 113–461 

SMALL BUSINESS DEVELOPMENT CENTERS 

IMPROVEMENT ACT OF 2014 

MAY 21, 2014.—Committed to the Committee of the Whole House on the State of 

the Union and ordered to be printed 

Mr. GRAVES of Missouri, from the Committee on Small Business, 

submitted the following 

R E P O R T 

[To accompany H.R. 4121] 

[Including cost estimate of the Congressional Budget Office] 

The Committee on Small Business, to whom was referred the bill 

(H.R. 4121) to amend the Small Business Act to provide for improvements to small business development centers, having considered the same, report favorably thereon with an amendment and 

recommend that the bill as amended do pass. 

CONTENTS 

Page 

I. Amendment ................................................................................................. 2 

II. Purpose of the Bill and Summary ............................................................. 3 

III. Background and the Need for Legislation ................................................ 4 

IV. Hearings ....................................................................................................... 5 

V. Committee Consideration ........................................................................... 6 

VI. Committee Votes ......................................................................................... 6 

VII. Section-by-Section Analysis of H.R. 4121 .................................................. 7 

VIII. Congressional Budget Cost Estimate ........................................................ 10 

IX. Unfunded Mandates .................................................................................... 10 

X. New Budget Authority, Entitlement Authority, and Tax Expenditures 11 

XI. Oversight Findings ...................................................................................... 11 

XII. Statement of Constitutional Authority ...................................................... 11 

XIII. Congressional Accountability Act .............................................................. 11 

XIV. Federal Advisory Committee Statement ................................................... 11 

XV. Statement of No Earmarks ........................................................................ 11 

XVI. Statement of Duplication of Federal Programs ........................................ 11 

XVII. Disclosure of Directed Rule Makings ........................................................ 12 

XVIII. Performance Goals and Objectives ............................................................ 12 

XIX. Changes in Existing Law Made by the Bill, as Reported ........................ 12 


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I. AMENDMENT

The amendment is as follows: 

Strike all after the enacting clause and insert the following: 

SECTION 1. SHORT TITLE. 

This Act may be cited as the ‘‘Small Business Development Centers Improvement 

Act of 2014’’. 

SEC. 2. USE OF AUTHORIZED ENTREPRENEURIAL DEVELOPMENT PROGRAMS. 

The Small Business Act (15 U.S.C. 631 et seq.) is amended by adding at the end 

the following: 

‘‘SEC. 48. USE OF AUTHORIZED ENTREPRENEURIAL DEVELOPMENT PROGRAMS. 

‘‘(a) EXPANDED SUPPORT FOR ENTRERPRENEURS.— 

‘‘(1) IN GENERAL.—Notwithstanding any other provision of law, the Administrator shall only use the programs authorized in sections 7(j), 7(m), 8(a), 8(b)(1), 

21, 22, 29, and 32 of this Act, and sections 358 and 389 of the Small Business 

Investment Act to deliver entrepreneurial development services, entrepreneurial 

education, business incubation services, growth acceleration services, support 

for the development and maintenance of clusters, or business training. 

‘‘(2) EXCEPTION.—This section shall not apply to services provided to assist 

small business concerns owned by an Indian tribe. 

‘‘(b) ANNUAL REPORT.—Beginning on the first December 1 after the date of enactment of this subsection, the Administrator shall annually report to the Committee 

on Small Business of the House of Representatives and the Committee on Small 

Business and Entrepreneurship of the Senate on all entrepreneurial development 

activities undertaken in the current fiscal year. This report shall include— 

‘‘(1) a description and operating details for each program and activity; 

‘‘(2) operating circulars, manuals, and standard operating procedures for each 

program and activity; 

‘‘(3) a description of the process used to award grants under each program 

and activity; 

‘‘(4) a list of all awardees, contractors, and vendors (including organization 

name and location) and the amount of awards for the current fiscal year for 

each program and activity; 

‘‘(5) the amount of funding obligated for the current fiscal year for each program and activity; and 

‘‘(6) the names and titles for those individuals responsible for each program 

and activity.’’. 

SEC. 3. MARKETING OF SERVICES. 

Section 21 of the Small Business Act (15 U.S.C. 648) is amended by adding at 

the end the following: 

‘‘(o) NO PROHIBITION OF MARKETING OF SERVICES.—The Administrator shall not 

prohibit applicants receiving grants under this section from marketing and advertising their services to individuals and small businesses.’’. 

SEC. 4. CONFIDENTIALITY REQUIREMENTS. 

Section 21(a)(7)(A) of the Small Business Act (15 U.S.C. 648(a)(7)(A)) is amended 

by inserting after ‘‘under this section’’ the following: ‘‘to any State, local or Federal 

agency or third party’’. 

SEC. 5. DATA COLLECTION. 

(a) IN GENERAL.—Section 21(a)(3)(A) of the Small Business Act (15 U.S.C. 

648(a)(3)(A)) is amended— 

(1) in clause (ii), by striking ‘‘as provided in this section and’’ and inserting 

‘‘as provided in this section,’’; and 

(2) by inserting before the period at the end the following: ‘‘, and (iv) governing data collection activities related to applicants receiving grants under this 

section’’. 

(b) ANNUAL REPORT ON DATA COLLECTION.—Section 21 of the Small Business Act 

(15 U.S.C. 648), as amended by section 3 of this Act, is further amended by adding 

at the end the following: 

‘‘(p) ANNUAL REPORT ON DATA COLLECTION.—The Administrator shall report annually to the Committee on Small Business of the House of Representatives and the 

Committee on Small Business and Entrepreneurship of the Senate on data collection activities related to the Small Business Development Center program.’’. 


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1Originally, title II of the Act of July 30, 1953, c. 282, 67 Stat. 232 was designated as the 

Small Business Act of 1953. A plethora of amendments in subsequent Congresses led to a rewrite in 1958. Pub. L. No. 85–536, § 1, 72 Stat. 384 (1958). The Act is codified at 15 U.S.C. 

§§ 631–657s. 

SEC. 6. MATCHMAKING AND OTHER EVENTS. 

Section 21(a)(3)(C) of the Small Business Act (15 U.S.C. 648(a)(3)(C)) is amended 

to read as follows: 

‘‘(C) Such participation in private partnerships and cosponsorships with the 

Administration shall not limit Small Business Development Centers from collecting fees or other income related to the operation of such partnerships and 

cosponsorships.’’. 

SEC. 7. EQUITY FOR SBDCS. 

Section 21(a)(4)(C)(v)(I) of the Small Business Act (15 U.S.C. 648(a)(4)(C)(v)(I)) is 

amended— 

(1) in item (aa), by striking ‘‘; and’’ and inserting a period; and 

(2) by striking item (bb). 

SEC. 8. AWARD OF GRANTS TO SBDCS. 

Section 21 of the Small Business Act (15 U.S.C. 648), as amended by sections 3 

and 5 of this Act, is further amended by adding at the end the following: 

‘‘(q) LIMITATION ON AWARD OF GRANTS.—Except for not-for-profit institutions of 

higher education, notwithstanding any provision of law, the Administrator shall not 

award grants (including contracts and cooperative agreements) under this section to 

any entity other than those that received grants (including contracts and cooperative agreements) under this section prior to September 30, 2014, and that seek to 

renew such grants (including contracts and cooperative agreements) after such 

date.’’. 

SEC. 9. DISASTER REFORMS. 

Section 21(b)(3) of the Small Business Act (15 U.S.C. 648(b)(3)) is amended— 

(1) by striking ‘‘(3) At the discretion’’ and inserting the following: 

‘‘(3) ASSISTANCE TO OUT-OF-STATE SMALL BUSINESSES.— 

‘‘(A) IN GENERAL.—At the discretion’’; and 

(2) by adding at the end the following: 

‘‘(B) DISASTER RECOVERY ASSISTANCE.— 

‘‘(i) IN GENERAL.—At the discretion of the Administrator, the Administrator may authorize a small business development center to provide 

assistance, as described in subsection (c), to a small business concern 

located outside of the State, without regard to geographic proximity, if 

the small business concern is located in an area for which the President 

has declared a major disaster under section 401 of the Robert T. Stafford Disaster Relief and Emergency Assistance Act (42 U.S.C. 5170), 

during the period of the declaration. 

‘‘(ii) CONTINUITY OF SERVICES.—A small business development center 

that provides counselors to an area described in clause (i) shall, to the 

maximum extent practicable, ensure continuity of services in any State 

in which the small business development center otherwise provides 

services. 

‘‘(iii) ACCESS TO DISASTER RECOVERY FACILITIES.—For purposes of this 

subparagraph, the Administrator shall, to the maximum extent practicable, permit the personnel of a small business development center to 

use any site or facility designated by the Administrator for use to provide disaster recovery assistance.’’. 

SEC. 10. INCLUSIONS OF ENTREPRENEURSHIP TRAINING FOR UNEMPLOYED INDIVIDUALS. 

Section 21(c)(3)(A) of the Small Business Act (15 U.S.C. 648(c)(3)(A)) is amended— 

(1) in clause (iii), by striking ‘‘and’’ at the end; 

(2) in clause (iv), by inserting ‘‘and’’ at the end; and 

(3) by adding at the end the following: 

‘‘(v) educating unemployed individuals on entrepreneurship and working 

with such individuals to start new businesses;’’. 

II. PURPOSE AND BILL SUMMARY

The purpose of H.R. 4121, the ‘‘Small Business Development 

Centers Improvement Act of 2014,’’ is to amend the Small Business 

Act (the Act) 1 to improve the small business development centers 


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2 In this case, resource partners refers to the non-federal partners that provide training authorized by the Small Business Act and funded, in part, by federal appropriations. These include 

SBDCs, Women’s Business Centers, Veteran’s Business Outreach Centers, and SCORE. 3The grantee agrees to provide services throughout a state. For reasons not relevant to H.R. 

4121, two states—California and Texas—do not have statewide grantees. 

(SBDCs) program and ensure SBDCs continue successful delivery 

of entrepreneurial development services to small businesses. 

SBDCs represent a key component of the Small Business Administration’s (SBA) counseling and training programs for small businesses. In order to continue these services, H.R. 4121 makes a variety of improvements, such as allowing SBDCs to market their private programs; strengthening confidentiality provisions; allowing 

SBDCs to maintain services in disaster stricken areas; and ensuring limited funds are not diverted to SBA administrative expenses. 

Further, the legislation creates a new section of the Act to 

strengthen delivery and implementation of small business entrepreneurial development programs. It does this by requiring that 

the Administrator of the SBA (Administrator) utilize pre-existing 

resource partners 2 to deliver agency-sponsored initiatives. Additionally, this section strengthens congressional oversight of entrepreneurial development (ED) programs by requiring better data 

collection as well as an annual report by SBA to the committees 

of jurisdiction on the ED activities occurring during the year. 

III. NEED FOR LEGISLATION

The United States has consistently recognized the need to encourage entrepreneurship as a means to combat unemployment 

and promote economic development. Therefore, the SBA’s mission, 

as evinced in the Small Business Act, 15 U.S.C. §§ 631–57p, is to 

‘‘aid, counsel, assist, and protect, insofar as is possible, the interests of small business concerns. . .’’ Id. at 631(a). In carrying out 

its mission to provide small businesses with assistance, the SBA 

oversees a number of programs that offer counseling to potential 

entrepreneurs and extant small business owners. The SBA itself, 

does not generally carry out this training; in most circumstances, 

the agency enters into a cooperative agreement with another organization to offer such services. The cooperators are termed as resource partners by the SBA and are required to obtain a significant 

portion of their operating budgets from non-federal sources (be they 

private donors or state funds). 

The largest such program is that set out in § 21 of the Act, 15 

U.S.C. § 648. The program is denominated as the SBDC Program 

because the resource partners, SBDC grantees, operate service centers where small business owners and potential entrepreneurs can 

receive free counseling. Typically, the grantee is an institution of 

higher education (but not always) and the grantee agrees to offer 

these services throughout a state or through a portion of the state.3

Since its inception, the SBDC program has been extremely successful in training and counseling small firms. For example, in fiscal 

year (FY) 2013, SBDCs trained over 330,000 clients and counseled 

over 201,000 clients. Further, in FY 2013 SBDCs assisted small 

business clients in obtaining $4.5 billion in financing. 

While the SBDC program clearly has been successful, the program has not received a comprehensive modernization in several 

years. The Committee also has learned of certain operational difVerDate Mar 15 2010 04:16 May 29, 2014 Jkt 039006 PO 00000 Frm 00004 Fmt 6659 Sfmt 6602 E:\HR\OC\HR461.XXX HR461

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4These concerns are clearly demonstrated and laid out in more detail by the Views and Estimates of the Committee on Small Business transmitted to Committee on the Budget for FY2012, 

FY2013, and FY 2014. 

ficulties imposed on SBDC grantees by SBA that hinder their ability to offer their services to small business owners. The Committee 

determined that these operational issues need legislative rectification. The majority of these are minor corrections, such as statutorily prescribing that SBDCs may market their services, collect 

fees at partnership events, and eliminating the Administrator’s 

ability to reimburse the SBA for administrative expenses associated with the SBDC program. In this case, as federal funding becomes scarcer, updating the Act to ensure SBDCs receive all funding allocated in the budget and are able obtain matching funds 

through self-promotion of the benefits of their program and fostering a fruitful relationship with local community partners is necessary. 

The SBA has three other resource partners focused on entrepreneurial training. Although their missions and scope of service territories also vary, the Women’s Business Centers (WBCs) and Veteran Business Outreach Centers (VBOCs) operate in a fashion akin 

to that of the SBDCs. The other major entrepreneurial outreach 

program, SCORE, operates somewhat differently. Although SCORE 

also offers free advice (from volunteer active and retired business 

executives), SCORE is provided almost all of its funds from those 

appropriated by Congress. The SBA also is required to provide offices and other ancillary services to SCORE at no charge to SCORE 

or their clients. 

A number of problems have come to the Committee’s attention 

concerning the operation of these ED programs.4 Most significantly, 

SBA, rather than fully funding their resource partners, diverts 

available funds to the creation of their own initiatives. For example, in SBA’s most recent budget request, while the overall agency 

budget request for specifically authorized ED programs remains 

static, SBA requested a total of $39 million for SBA-created initiatives an—increase of $12 million from what was requested and appropriated in FY 2014. These initiatives often duplicate the efforts 

of the resource partners but do not have sound plans of operation 

or have appropriate measurable metrics to measure the initiatives 

success. Despite assurances from SBA that the agencies own initiatives do not divert funds from proven entrepreneurial outreach efforts, the Committee believes that the agency’s discretion must be 

circumscribed to ensure that its longstanding resource partners can 

fulfill their mission. Therefore, this legislation adds a new section 

to the Act which requires SBA to deliver these initiatives through 

the resource partners. This is necessary to reduce duplicative, fragmented, and overlapping programs which have not been authorized 

by Congress and to ensure that established programs, such as 

SBDCs, are engaged in delivering the initiatives. 

IV. HEARINGS

In the 113th Congress, issues related to SBDCs and oversight of 

ED programs were addressed at full committee hearings. One hearing, entitled ‘‘Entrepreneurial Assistance: Examining Inefficiencies 

and Duplication Across Federal Programs’’ on March 20, 2013, speVerDate Mar 15 2010 04:16 May 29, 2014 Jkt 039006 PO 00000 Frm 00005 Fmt 6659 Sfmt 6602 E:\HR\OC\HR461.XXX HR461

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cifically examined ineffectiveness, inefficiency, and pleonasms in 

the SBA entrepreneurial assistance programs. On April 18, 2013, 

the full committee held a hearing entitled ‘‘The Budget Outlook for 

the Small Business Administration’’ at which members, on a bipartisan basis, raised concerns with the then Administrator about the 

impact that these new initiatives would have on existing resource 

partners. 

V. COMMITTEE CONSIDERATION

The Committee on Small Business met in open session, with a 

quorum being present, on March 5, 2014, and ordered H.R. 4121 

reported, as amended, to the House by a voice vote at 4:21 pm. 

During the markup, two amendments were offered, and both were 

adopted. Disposition of the amendments is addressed below and is 

based on the order amendments were filed with the Clerk of the 

Committee and not necessarily in the order that they were considered at the markup. 

Amendment Number One filed by Mr. Murphy (D–FL) amends 

§ 21(b)(3) of the Small Business Act to allow SBDCs to provide assistance in the event of a major disaster outside their immediate 

geographic area to ensure a continuity of services. Amendment 

Number One was adopted by a voice vote at 4:15 pm. 

Amendment Number Two filed by Mr. Payne (D–NJ) amends 

§ 21(c)(3) of the Small Business Act to provide that SBDCs also 

work with unemployed individuals in one-on-one counseling sessions. Amendment Number Two was adopted by a voice vote at 

4:20 pm. 

VI. COMMITTEE VOTES

Clause 3(b) of rule XIII of the Rules of the House of Representatives requires the Committee to list the recorded votes on the motion to report the legislation and amendments thereto. No recorded 

votes were taken in consideration of H.R. 4121. 

AMENDMENT TO H.R. 4121 

OFFERED BY MR. MURPHY OF FLORIDA

Add, at the end of the bill, the following: 

SEC. 9. DISASTER REFORMS. 

Section 21(b)(3) of the Small Business Act (15 U.S.C. 648(b)(3)) is amended— 

(1) by striking ‘‘(3) At the discretion’’ and inserting the following: 

‘‘(3) ASSISTANCE TO OUT-OF-STATE SMALL BUSINESSES.— 

‘‘(A) IN GENERAL.—At the discretion’’; and 

(2) by adding at the end the following: 

‘‘(B) DISASTER RECOVERY ASSISTANCE.— 

‘‘(i) IN GENERAL.—At the discretion of the Administrator, the Administrator may authorize a small business development center to provide 

assistance, as described in subsection (c), to a small business concern 

located outside of the State, without regard to geographic proximity, if 

the small business concern is located in an area for which the President 

has declared a major disaster under section 401 of the Robert T. Stafford Disaster Relief and Emergency Assistance Act (42 U.S.C. 5170), 

during the period of the declaration. 

‘‘(ii) CONTINUITY OF SERVICES.—A small business development center 

that provides counselors to an area described in clause (i) shall, to the 

maximum extent practicable, ensure continuity of services in any State 

in which the small business development center otherwise provides 

services. 


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‘‘(iii) ACCESS TO DISASTER RECOVERY FACILITIES.—For purposes of this 

subparagraph, the Administrator shall, to the maximum extent practicable, permit the personnel of a small business development center to 

use any site or facility designated by the Administrator for use to provide disaster recovery assistance.’’. 

AMENDMENT TO H.R. 4121 

OFFERED BY MR. PAYNE OF NEW JERSEY

Add, at the end of the bill, the following: 

SEC. 9. INCLUSIONS OF ENTREPRENEURSHIP TRAINING FOR UNEMPLOYED INDIVIDUALS. 

Section 21(c)(3) of the Small Business Act (15 U.S.C. (c)(3)) is amended— 

(1) in clause (iii), by striking ‘‘and’’ at the end; 

(2) in clause (iv), by inserting ‘‘and’’ at the end; and 

(3) by adding at the end the following: 

‘‘(v) educating unemployed individuals on entrepreneurship and 

working with such individuals to start new businesses;’’. 

VII. SECTION-BY-SECTION ANALYSIS OF H.R. 4121 AS AMENDED

Section 1. Short title 

This section provides that the bill may be cited as the ‘‘Small 

Business Development Centers Improvement Act of 2014.’’ 

Section 2. Use of authorized entrepreneurial development programs 

This section amends the Act (15 U.S.C. §§ 631–57s) by creating 

a new section 48 of the Act. 

Subsection (a)—Expanded support for entrepreneurs 

Currently, the Administrator is creating and separately funding 

initiatives developed by the agency. Subsection (a) changes this 

practice to prohibit the Administrator from utilizing unauthorized 

programs to deliver ED services and provides that all SBA-created 

initiatives must be delivered through those authorized programs 

specifically cross-referenced in this subsection. As resource partners are the only entities with specific statutory authority to deliver ED support through the SBA, this promotes operational efficiencies, benefitting both small businesses and the taxpayer. Further, given the abundance of ED programs across federal agencies 

as identified by GAO duplication reports, the statutory restriction 

in new § 48 will help reduce overlapping and duplicative efforts 

without harming the ability of small businesses to obtain the necessary counseling and training they require. The only exception to 

this overall prohibition, in subsection (a)(2)(A) relates to assistance 

offered to small business concerns owned by an Indian tribe. 

Subsection (b)—Annual report 

Given that SBA-led initiatives are created under the SBA’s general authority to offer assistance to small businesses, these programs do not contain the appropriate performance metrics or operating standards that would result had Congress specifically provided for their establishment. This subsection makes an effort to 

fill that gap in part by requiring the SBA to issue a report to Congress delineating all ED activities during the current fiscal year. 

This subsection proscribes items which must be included within the 

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gram and activity; operating circulars, manuals, and standard operating procedures for each program and activity; a list of all 

awardees, contractors, and vendors (including organization name 

and location) and the amounts of awards for the current fiscal year 

for each program and activity; the amount of funding obligated for 

the current fiscal year for each program and activity; and the 

names and titles for those individuals responsible for each program 

and activity. The data required in the report will help ensure that 

the Committees of jurisdiction have necessary information to ascertain whether taxpayers dollars are being spent wisely. 

Section 3. Marketing of services 

The Act is currently silent on the question of whether SBDCs can 

market and advertise their products and services. This section 

amends § 21 of the Act by adding a new subsection (o), which ensures the SBDCs are able to market and advertise their products 

and services. Greater awareness of the services available through 

the SBDCs will allow more small businesses to receive entrepreneurial assistance without imposing any more financial burdens on 

SBDCs, the SBA, or the taxpayer. 

Section 4. Confidentiality requirements 

The SBA’s current operational guidelines for the SBDC program 

require that SBDCs collect certain information on the businesses 

they counsel. This information is the basis for some of the performance metrics the agency uses to determine the effectiveness of the 

SBDCs in fulfilling their mission. Some of the information collected 

for this purpose, while relevant and necessary for the SBA and 

SBDCs, is sensitive information that small businesses wish to have 

treated as confidential. The Committee has become aware of instances in which the SBA is sharing this information with third 

parties. This sensitive information—such as the name of business— 

is not necessary to develop performance metrics. However, its 

forced disclosure could dissuade businesses from seeking assistance 

through the SBDCs, thereby undermining the intent of Congress 

when it created the SBDCs. Therefore, this section amends 

§ 21(a)(7)(A) of the Act to prohibit the SBA from distributing and 

sharing SBDC client information with other parties. This reinforces 

the Committee’s longstanding efforts to ensure the confidentiality 

of information that small businesses provide to SBDCs. 

Section 5. Data collection 

In order for the SBA to provide Congress with information to 

properly evaluate ED programs, SBA has been revising forms, such 

as the EDMIS form, to gather better performance data. During this 

process, there have been concerns that some of the required information would force SBDCs to capture and report data that small 

businesses are reluctant to share. In cases where this information 

is of little value to the government, these requirements place an 

unnecessary burden on the SBDCs and will dissuade small businesses from seeking SBDC assistance. 

To correct this problem, H.R. 4121 amends § 21(a)(3)(A) of the 

Act to require the Administrator to consult with the Association of 

Small Business Development Centers on the creation of documents 

governing data collection activities related to SBDCs. Section 21 is 


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further amended by adding a new subsection (p) which requires the 

Administrator to provide an annual report on data collection activities related to the SBDC program to the appropriate Congressional 

committees. 

Section 6. Matchmaking and other events 

In order to obtain funding, SBDC grantees must match funds 

provided by the federal government with non-federal sources, such 

as private donations or state funds. Therefore, SBDCs often work 

alongside other community partners, such as a local chamber of 

commerce, to host events as a partnership or a co-sponsor. In these 

instances, a participation fee may be charged to businesses by the 

partnership or cosponsoring party. However, under current law 

SBDCs are not allowed to collect the necessary fee. Therefore, this 

section amends § 21(a)(3)(C) of the Act to permit SBDCs to collect 

fees or other income related to the operation of partnerships or cosponsorships. This authorization does not alter the no-cost counseling provided by SBDCs to individual small businesses. 

Section 7. Equity for SBDCs 

Under current law, up to $500,000 of authorized funding to 

SBDCs could be utilized by the Administrator to pay for examination expenses associated with reviewing SBDCs. No other ED program has an allocation of funds to reimburse the SBA for the agency’s administrative expenses. This section eliminates the award of 

$500,000 of SBDC grant monies to reimburse the SBA for program 

administration. The Committee believes that the SBA has sufficient resources in its salaries and expense account to cover the cost 

of administering the SBDC program. 

Section 8. Award of grants to SBDCs 

A majority of SBDC grantees are partnered with higher education institutions which bolster SBDCs ability to obtain private 

matching funding as required under law. This section adds a new 

subsection (q) to § 21 of the Act by prohibiting entities other than 

institutions of higher education from becoming grantees under § 21. 

An exception is provided for current SBDC grantees who are not 

institutions of higher education. These institutions may continue to 

renew their status as a grantee until they no longer wish to do so 

or the SBA determines that these grandfathered grantees are incapable of providing such services. 

Section 9. Disaster reforms 

Currently, when a President declares an area a major disaster, 

SBDCs located outside that geographic area are prohibited from assisting small firms in the disaster area. This section amends 

§ 21(b)(3) of the Act to allow the Administrator to authorize SBDCs 

to provide assistance outside their immediate geographic area in 

the event of a major disaster as declared by the President to ensure 

a continuity of services to small firms. 

Section 10. Inclusions of entrepreneurship training for unemployed 

individuals 

This section amends § 21(c)(3)(A) of the Act to provide that 

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seling sessions to encourage entrepreneurship. As SBDCs already 

provide no-cost training to all individuals regardless of employment 

status, the Committee believes that this provision will highlight 

the potential for entrepreneurship among the unemployed. 

VIII. CONGRESSIONAL BUDGET COST ESTIMATE

U.S. CONGRESS, CONGRESSIONAL BUDGET OFFICE, Washington, DC, April 8, 2014. 

Hon. SAM GRAVES, Chairman, Committee on Small Business, 

House of Representatives, Washington, DC. 

DEAR MR. CHAIRMAN: The Congressional Budget Office has prepared the enclosed cost estimate for H.R. 4121, the Small Business 

Development Centers Improvement Act of 2014. 

If you wish further details on this estimate, we will be pleased 

to provide them. The CBO staff contact is Susan Willie. 

Sincerely, 

DOUGLAS W. ELMENDORF. 

Enclosure. 

H.R. 4121—Small Business Development Centers Improvement Act 

of 2014 

H.R. 4121 would direct the Small Business Administration (SBA) 

to develop procedures to govern the collection of data about Small 

Business Development Centers (SBDCs) that receive grants from 

the SBA. The bill also would require the SBA to prepare two new 

reports, one describing the agency’s efforts to promote entrepreneurship and another providing information about the SBA’s efforts 

to collect data from SBDCs. Finally, the bill would amend rules affecting SBDCs by, for instance, allowing SBDCs to market their 

services. 

Based on information from the SBA, CBO estimates that implementing H.R. 4121 would cost about $1 million per year over the 

2015–2019 period, assuming appropriation of the necessary 

amounts, for additional data collection and monitoring activities. 

Enacting H.R. 4121 would not affect direct spending or revenues; 

therefore, pay-as-you-go procedures do not apply. 

H.R. 4121 contains no intergovernmental or private-sector mandates as defined in the Unfunded Mandates Reform Act and would 

not affect the budgets of state, local, or tribal governments. 

The CBO staff contact for this estimate is Susan Willie. The estimate was approved by Theresa Gullo, Deputy Assistant Director 

for Budget Analysis. 

IX. UNFUNDED MANDATES

H.R. 4121 contains no intergovernmental or private-sector mandates as defined in the Unfunded Mandates Reform Act, Pub. L. 

No. 104–4, and would impose no costs on state, local or tribal governments. 


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X. NEW BUDGET AUTHORITY, ENTITLEMENT AUTHORITY AND TAX

EXPENDITURES

In compliance with clause 3(c)(2) of Rule XIII of the Rules of the 

House, the Committee provides the following opinion and estimate 

with respect to new budget authority, entitlement authority and 

tax expenditures. 

The Committee does not adopt as its own the estimate of new 

budget authority contained in the cost estimate prepared by the Director of the Congressional Budget Office pursuant to 402 of the 

Congressional Budget Act of 1974. While the Congressional Budget 

Office estimates a cost of $1 million over 5 years to implement H.R. 

4121, the Committee does not believe that this legislation will require any additional budget authority or expenditures. As the bill 

authorizes no new funding and simply directs how current appropriations should be spent, the Committee believes that no additional funds should not be necessary to implement this legislation. 

XI. OVERSIGHT FINDINGS

In accordance with clause (2)(b)(1) of rule X of the Rules of the 

House, the oversight findings and recommendations of the Committee on Small Business with respect to the subject matter contained in H.R. 4121 are incorporated into the descriptive portions 

of this report. 

XII. STATEMENT OF CONSTITUTIONAL AUTHORITY

Pursuant to clause 3(d)(1) of rule XIII of the Rules of the House 

of Representatives, the Committee finds that the authority for this 

legislation in Art. I, § 8, cl. 3 of the Constitution of the United 

States. 

XIII. CONGRESSIONAL ACCOUNTABILITY ACT

H.R. 4121 does not relate to the terms and conditions of employment or access to public services or accommodations within the 

meaning of 102(b)(3) of Pub. L. No. 104–1. 

XIV. FEDERAL ADVISORY COMMITTEE ACT STATEMENT

H.R. 4121 does not establish or authorize the establishment of 

any new advisory committees as that term is defined in the Federal 

Advisory Committee Act, 5 U.S.C. App. 2. 

XV. STATEMENT OF NO EARMARKS

Pursuant to clause 9 of rule XXI, H.R. 4121 does not contain any 

congressional earmarks, limited tax benefits or limited tariff benefits as defined in subsections (d), (e) or (f) of clause 9 of rule XXI 

of the rules of the House. 

XVI. STATEMENT OF DUPLICATION OF FEDERAL PROGRAMS

Pursuant to clause 3(c) of rule XIII of the Rules of the House, 

H.R. 4121 seeks to reduce duplicative federal programs for entrepreneurial development as identified in various GAO reports. Further, the findings and recommendations of the Committee on Small 

Business with respect to the subject matter contained in H.R. 4121 


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are incorporated into the descriptive portions of this report and will 

help eliminate duplication of federal assistance to small businesses. 

XVII. DISCLOSURE OF DIRECTED RULE MAKINGS

Pursuant to clause 3(c) of rule XIII of the Rules of the House, 

H.R. 4121 does not direct any rulemaking. 

XVIII. PERFORMANCE GOALS AND OBJECTIVES

Pursuant to clause 3(c)(4) of rule XIII of the Rules of the House, 

the Committee establishes the following performance-related goals 

and objectives for this legislation: 

H.R. 4121 includes a number of provisions designed to improve 

Small Business Developments Centers as authorized in the Small 

Business Act, increase transparency in entrepreneurial development programs, and promote the work of small businesses. 

XIX. CHANGES IN EXISTING LAW MADE BY THE BILL, AS REPORTED

In compliance with clause 3(e) of rule XIII of the Rules of the 

House of Representatives, changes in existing law made by the bill, 

as reported, are shown as follows (existing law proposed to be omitted is enclosed in black brackets, new matter is printed in italic, 

existing law in which no change is proposed is shown in roman): 

SMALL BUSINESS ACT 

* * * * * * * 

SEC. 21. (a)(1) * * * 

* * * * * * * 

(3) The Small Business Development Center Program shall be 

under the general management and oversight of the Administration for the delivery of programs and services to the small business 

community. Such programs and services shall be jointly developed, 

negotiated, and agreed upon, with full participation of both parties, 

pursuant to an executed cooperative agreement between the Small 

Business Development Center applicant and the Administration. 

(A) Small business development centers are authorized to form 

an association to pursue matters of common concern. If more than 

a majority of the small business development centers which are operating pursuant to agreements with the Administration are members of such an association, the Administration is authorized and 

directed to recognize the existence and activities of such an association and to consult with it and develop documents (i) announcing 

the annual scope of activities pursuant to this section, (ii) requesting proposals to deliver assistance øas provided in this section and¿ 

as provided in this section, (iii) governing the general operations 

and administration of the Small Business Development Center Program, specifically including the development of regulations and a 

uniform negotiated cooperative agreement for use on an annual 

basis when entering into individual negotiated agreements with 

small business development centers, and (iv) governing data collection activities related to applicants receiving grants under this section. 

* * * * * * * 


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ø(C) Whereas On an annual basis, the Small Business Development Center shall review and coordinate public and private 

partnerships and cosponsorships with the Administration for 

the purpose of more efficiently leveraging available resources 

on a National and a State basis.¿ 

(C) Such participation in private partnerships and cosponsorships with the Administration shall not limit Small Business 

Development Centers from collecting fees or other income related to the operation of such partnerships and cosponsorships. 

(4) SMALL BUSINESS DEVELOPMENT CENTER PROGRAM LEVEL.— (A) * * * 

* * * * * * * 

(C) FUNDING FORMULA.— 

(i) * * * 

* * * * * * * 

(v) USE OF AMOUNTS.— 

(I) IN GENERAL.—Of the amounts made available in 

any fiscal year to carry out this section— 

(aa) not more than $500,000 may be used by the 

Administration to pay expenses enumerated in 

subparagraphs (B) through (D) of section 

20(a)(1)ø; and¿. 

ø(bb) not more than $500,000 may be used by 

the Administration to pay the examination expenses enumerated in section 20(a)(1)(E).¿ 

* * * * * * * 

(7) PRIVACY REQUIREMENTS.— 

(A) IN GENERAL.—A small business development center, 

consortium of small business development centers, or contractor or agent of a small business development center 

may not disclose the name, address, or telephone number 

of any individual or small business concern receiving assistance under this section to any State, local or Federal 

agency or third party without the consent of such individual or small business concern, unless— 

(i) * * * 

* * * * * * * 

(b)(1) * * * 

* * * * * * * 

ø(3) At the discretion¿ 

(3) ASSISTANCE TO OUT-OF-STATE SMALL BUSINESSES.— 

(A) IN GENERAL.—At the discretion of the Administration, the Administration is authorized to permit a small 

business development center to provide advice, information 

and assistance, as described in subsection (c), to small 

businesses located outside the State, but only to the extent 

such businesses are located within close geographical proximity to the small business development center, as determined by the Administration. 

(B) DISASTER RECOVERY ASSISTANCE.— 

(i) IN GENERAL.—At the discretion of the Administrator, the Administrator may authorize a small busiVerDate Mar 15 2010 04:16 May 29, 2014 Jkt 039006 PO 00000 Frm 00013 Fmt 6659 Sfmt 6603 E:\HR\OC\HR461.XXX HR461

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ness development center to provide assistance, as described in subsection (c), to a small business concern 

located outside of the State, without regard to geographic proximity, if the small business concern is located in an area for which the President has declared 

a major disaster under section 401 of the Robert T. 

Stafford Disaster Relief and Emergency Assistance Act 

(42 U.S.C. 5170), during the period of the declaration. 

(ii) CONTINUITY OF SERVICES.—A small business development center that provides counselors to an area 

described in clause (i) shall, to the maximum extent 

practicable, ensure continuity of services in any State 

in which the small business development center otherwise provides services. 

(iii) ACCESS TO DISASTER RECOVERY FACILITIES.—For 

purposes of this subparagraph, the Administrator 

shall, to the maximum extent practicable, permit the 

personnel of a small business development center to use 

any site or facility designated by the Administrator for 

use to provide disaster recovery assistance. 

(c)(1) * * * 

* * * * * * * 

(3) Services provided by a small business development center 

shall include, but shall not be limited to— 

(A) furnishing one-to-one individual counseling to small businesses, including— 

(i) * * * 

* * * * * * * 

(iii) working with the Administration to develop and provide informational tools for use in working with individuals on pre-business startup planning, existing business 

expansion, and export planning; øand¿ 

(iv) working with individuals referred by the local offices 

of the Administration and Administration participating 

lenders; and 

(v) educating unemployed individuals on entrepreneurship and working with such individuals to start new businesses; 

* * * * * * * 

(o) NO PROHIBITION OF MARKETING OF SERVICES.—The Administrator shall not prohibit applicants receiving grants under this section from marketing and advertising their services to individuals 

and small businesses. 

(p) ANNUAL REPORT ON DATA COLLECTION.—The Administrator 

shall report annually to the Committee on Small Business of the 

House of Representatives and the Committee on Small Business and 

Entrepreneurship of the Senate on data collection activities related 

to the Small Business Development Center program. 

(q) LIMITATION ON AWARD OF GRANTS.—Except for not-for-profit 

institutions of higher education, notwithstanding any provision of 

law, the Administrator shall not award grants (including contracts 

and cooperative agreements) under this section to any entity other 

than those that received grants (including contracts and cooperative 


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agreements) under this section prior to September 30, 2014, and 

that seek to renew such grants (including contracts and cooperative 

agreements) after such date. 

* * * * * * * 

SEC. 48. USE OF AUTHORIZED ENTREPRENEURIAL DEVELOPMENT 

PROGRAMS. 

(a) EXPANDED SUPPORT FOR ENTRERPRENEURS.— 

(1) IN GENERAL.—Notwithstanding any other provision of 

law, the Administrator shall only use the programs authorized 

in sections 7(j), 7(m), 8(a), 8(b)(1), 21, 22, 29, and 32 of this Act, 

and sections 358 and 389 of the Small Business Investment Act 

to deliver entrepreneurial development services, entrepreneurial 

education, business incubation services, growth acceleration 

services, support for the development and maintenance of clusters, or business training. 

(2) EXCEPTION.—This section shall not apply to services provided to assist small business concerns owned by an Indian 

tribe. 

(b) ANNUAL REPORT.—Beginning on the first December 1 after the 

date of enactment of this subsection, the Administrator shall annually report to the Committee on Small Business of the House of Representatives and the Committee on Small Business and Entrepreneurship of the Senate on all entrepreneurial development activities 

undertaken in the current fiscal year. This report shall include— 

(1) a description and operating details for each program and 

activity; 

(2) operating circulars, manuals, and standard operating procedures for each program and activity; 

(3) a description of the process used to award grants under 

each program and activity; 

(4) a list of all awardees, contractors, and vendors (including 

organization name and location) and the amount of awards for 

the current fiscal year for each program and activity; 

(5) the amount of funding obligated for the current fiscal year 

for each program and activity; and 

(6) the names and titles for those individuals responsible for 

each program and activity. 

Æ 


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