§ 35.27 Definitions. In this subpart: ( a ) *Controlling influence over a business* means having the power to control, manage, or direct the business. A person is presumed to have a controlling influence over a business if the person is a senior executive officer or senior manager of the business (e.g., Chief Executive Officer, Chief Financial Officer, Chief Operating Officer), or any other individual who regularly performs similar functions.
( b ) *Jurisdiction* means: ( 1 ) One of the fifty states of the United States;
( 2 ) The District of Columbia, the Commonwealth of Puerto Rico, the Commonwealth of Northern Mariana Islands, Guam, American Samoa, and the United States Virgin Islands;
( 3 ) When designated by one of the fifty states of the United States, a political subdivision of that state that the U.S. Department of the Treasury determines has the capacity to participate in the State Small Business Credit Initiative;
( 4 ) Under the circumstances described in 12 U.S.C. 5703(d), a municipality of one of the fifty states of the United States to which the U.S. Department of the Treasury has given a special permission under 12 U.S.C. 5703(d); and
( 5 ) A Tribal government or a group of Tribal governments that jointly apply to be approved by the U.S. Department of Treasury to participate in the State Small Business Credit Initiative as a single participating jurisdiction.
( c ) *Minority individual* means a natural person who identifies as American Indian or Alaska Native; Asian; Black or African American; Native Hawaiian or Other Pacific Islander; or Hispanic or Latino/a; or one or more than one of these groups.
( d ) *Minority-owned or controlled business* means a business that: ( 1 ) If privately owned, 51 percent or more is owned by minority individuals;
( 2 ) If publicly owned, 51 percent or more of the stock is owned by minority individuals;
( 3 ) In the case of a mutual institution, a majority of the board of directors, account holders, and the community which the institution services is predominantly comprised of minority individuals; or
( 4 ) One or more minority individuals have the power to exercise a controlling influence over the business.
( e ) *Participating jurisdiction* means a jurisdiction that has been approved by the U.S. Department of the Treasury for participation in the State Small Business Credit Initiative.
( f ) *Principal owner* of a business means a natural person who directly or indirectly, through any contract, arrangement, understanding, relationship or otherwise, owns 25 percent or more of the equity interests of the business. If a trust owns, directly or indirectly, through any contract, arrangement, understanding, relationship or otherwise, 25 percent or more of the equity interests of the business, the trustee is a principal owner.
( g ) *Socially and economically disadvantaged individual (SEDI) demographics-related business* means a business owned and controlled by individuals who have had their access to credit on reasonable terms diminished compared to others in comparable economic circumstances, due to their: ( 1 ) Membership of a group that has been subjected to racial or ethnic prejudice or cultural bias within American society;
( 2 ) Gender;
( 3 ) Veteran status;
( 4 ) Limited English proficiency;
( 5 ) Disability;
( 6 ) Long-term residence in an environment isolated from the mainstream of American society;
( 7 ) Membership of a federally or state-recognized Indian Tribe;
( 8 ) Long-term residence in a rural community;
( 9 ) Residence in a U.S. territory;
( 10 ) Residence in a community undergoing economic transitions (including communities impacted by the shift towards a net-zero economy or deindustrialization); or
( 11 ) Membership of an *underserved community.* ( i ) *Underserved communities* are populations sharing a particular characteristic, as well as geographic communities, that have been systematically denied a full opportunity to participate in aspects of economic, social, and civic life, as exemplified by the list in the definition of *equity* in paragraph (g)(11)(ii) of this section; and
( ii ) *Equity* is consistent and systematic fair, just, and impartial treatment of all individuals, including individuals who belong to underserved communities that have been denied such treatment, such as Black, Latino, and Indigenous and Native American persons, Asian Americans and Pacific Islanders, and other persons of color; members of religious minorities; lesbian, gay, bisexual, transgender, and queer (LGBTQ+) persons; persons with disabilities; persons who live in rural areas; and persons otherwise adversely affected by persistent poverty or inequality.
( 12 ) For purposes of this paragraph (g), a business is “owned and controlled” by applicable individuals: ( i ) If privately owned, 51 percent or more is owned by such individuals;
( ii ) If publicly owned, 51 percent more or of the stock is owned by such individuals; and
( ii ) In the case of a mutual institution, if a majority of the board of directors, account holders, and the community which the institution services is predominantly comprised of such individuals.
( h ) *Veteran-owned or controlled business* means a business that: ( 1 ) If privately owned, 51 percent or more is owned by veterans;
( 2 ) If publicly owned, 51 percent or more of the stock is owned by veterans;
( 3 ) In the case of a mutual institution, a majority of the board of directors, account holders, and the community which the institution services is predominantly comprised of veterans; or
( 4 ) One or more individuals who are veterans have the power to exercise a controlling influence over the business.
( i ) *Women-owned or controlled business* means a business that: ( 1 ) If privately owned, 51 percent or more is owned by females;
( 2 ) If publicly owned, 51 percent or more of the stock is owned by females;
( 3 ) In the case of a mutual institution, a majority of the board of directors, account holders, and the community which the institution services is predominantly comprised of females; or
( 4 ) One or more individuals who are females have the power to exercise a controlling influence over the business.