I 

110TH CONGRESS 

1ST SESSION H. R. 2532 

To enhance the section 8(a) program of the Small Business Act. 

IN THE HOUSE OF REPRESENTATIVES 

MAY 24, 2007 

Ms. MOORE of Wisconsin (for herself and Mr. BARROW) introduced the 

following bill; which was referred to the Committee on Small Business 

A BILL 

To enhance the section 8(a) program of the Small Business 

Act. 

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; TABLE OF CONTENTS. 

4 (a) SHORT TITLE.—This Act may be cited as the 

5 ‘‘Minority-Owned Venture Empowerment Act of 2007’’. 

6 (b) TABLE OF CONTENTS.—The table of contents for 

7 this Act is as follows: 

Sec. 1. Short title; table of contents. 

TITLE I—PRE-8(a) PHASE 

Sec. 101. Purpose. 

Sec. 102. Technical assistance program. 

TITLE II—MODIFICATIONS TO 8(a) PROGRAM 

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Sec. 201. Purpose. 

Sec. 202. Administration of section 8(a) program. 

TITLE III—POST-8(a) ASSISTANCE 

Sec. 301. Purpose. 

Sec. 302. Retention of status after completion of 8(a) program. 

Sec. 303. Restricted competition for small businesses owned and controlled by 

socially and economically disadvantaged individuals. 

1 TITLE I—PRE-8(a) PHASE 

2 SEC. 101. PURPOSE. 

3 The purpose of this title is as follows: 

4 (1) To establish a developmental training initia5 tive to provide small business concerns with the 

6 technical assistance necessary to navigate the Fed7 eral marketplace. 

8 (2) To ensure that owners of small business 

9 concerns are adequately prepared to perform con10 tracts upon entrance into the Federal marketplace. 

11 SEC. 102. TECHNICAL ASSISTANCE PROGRAM. 

12 (a) ESTABLISHMENT.—The Administrator of the 

13 Small Business Administration shall establish a program 

14 to be known as the ‘‘Pre-8(a) Program’’ (in this section 

15 referred to as the ‘‘Program’’) to provide technical assist16 ance to small business concerns with respect to the receipt 

17 and performance of Federal procurement contracts. 

18 (b) ELIGIBILITY.— 

19 (1) OWNERSHIP AND NET WORTH.—To be eligi20 ble to participate in the Program under this section, 

21 a small business concern shall— 

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1 (A) be owned and controlled by one or 

2 more socially and economically disadvantaged 

3 individual; and 

4 (B) have a net worth that does not exceed 

5 the maximum level specified pursuant to sub6 section (g). 

7 (2) APPLICATION.—To participate in the Pro8 gram under this section, a small business concern 

9 shall submit an application describing the ownership, 

10 control, and social and economic disadvantage of the 

11 small business concern. 

12 (3) NONAPPLICABILITY OF OTHER FACTORS.— 

13 In approving a small business concern for participa14 tion in the Program, the Administrator shall not 

15 consider the following factors: 

16 (A) The length of time for which the small 

17 business concern has been in business in its pri18 mary industry classification. 

19 (B) The prospects for success of the small 

20 business concern in competing in the private 

21 sector. 

22 (C) The access to credit and capital of the 

23 small business concern. 

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1 (D) The technical and managerial experi2 ence of the managers of the small business con3 cern. 

4 (E) The operating history of the small 

5 business concern. 

6 (F) The demonstrated technical knowledge 

7 of the small business concern. 

8 (G) The record of performance on Federal 

9 and private sector contracts of the small busi10 ness concern. 

11 (H) The financial history of the small busi12 ness concern. 

13 (I) Any outside employment of the owner 

14 of the small business concern. 

15 (c) NEEDS ASSESSMENT.— 

16 (1) ASSESSMENT REQUIRED.—Not less than 

17 once every two years, the Administrator shall con18 duct a needs assessment of each small business con19 cern participating in the Program under this section. 

20 Such needs assessment shall include the following: 

21 (A) An assessment of the training and 

22 skills of the owner of the small business concern 

23 (including business management training, mar24 keting, accounting, bookkeeping, and Federal 

25 contracting). 

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1 (B) A determination of the likelihood that 

2 the small business concern will receive Federal 

3 prime contracts in its primary industry or in 

4 associated industry areas through technical as5 sistance and development provided through the 

6 Program. 

7 (2) TERMINATION OF PARTICIPATION.—If the 

8 Administrator determines, pursuant to a needs as9 sessment, that a participating small business con10 cern is not making progress toward financial sound11 ness and participation in Federal contracts, the Ad12 ministrator may terminate the participation of the 

13 small business concern in the Program. 

14 (d) NONELIGIBILITY FOR SOLE SOURCE OR COM15 PETITIVE CONTRACTS.—A small business concern partici16 pating in the Program shall not be eligible to be awarded 

17 a Federal contract awarded using procedures other than 

18 competitive procedures or a contract awarded using com19 petitive procedures under section 8(a) of the Small Busi20 ness Act (15 U.S.C. 637(a)). 

21 (e) AGREEMENT FOR FACILITATION OF TRAINING.— 

22 In order to facilitate the provision of technical assistance 

23 under the Program, the Administrator shall enter into an 

24 agreement with the Secretary of Defense regarding the 

25 use of Procurement Technical Assistance Centers. The 

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1 Administrator may enter into such other agreements with 

2 other providers of technical assistance as the Adminis3 trator finds appropriate. 

4 (f) COMPLETION OF PROGRAM PARTICIPATION.—A 

5 small business concern shall have completed the Program 

6 if the Administrator determines that it is financially sound 

7 and has successfully performed a Federal contract. 

8 (g) NET WORTH REQUIREMENTS.— 

9 (1) ESTABLISHMENT OF MAXIMUM LEVELS.— 

10 Not later than 180 days, the Administrator shall es11 tablish, for each industry classification, a maximum 

12 level of net worth for a small business entering the 

13 Program. In establishing such maximum levels, the 

14 Administrator shall take into consideration the cap15 ital needs of each industry. 

16 (2) TREATMENT OF REAL ESTATE.—In deter17 mining the net worth of a small business concern for 

18 purposes of this subsection, the Administrator shall 

19 not include the value of any real estate owned by the 

20 owner of the small business concern. 

21 (3) TRANSITIONAL RULE.—Until the Adminis22 trator establishes maximum net worth levels pursu23 ant to paragraph (1), the maximum net worth of a 

24 small business eligible to enter the Program shall 

25 not exceed $750,000. 

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1 TITLE II—MODIFICATIONS TO 

2 8(a) PROGRAM 

3 SEC. 201. PURPOSE. 

4 The purpose of this title is as follows: 

5 (1) to ensure that the section 8(a) program of 

6 the Small Business Act continues as an effective de7 velopmental business tool that aids in the further 

8 growth of minority entrepreneurs. 

9 (2) To enhance the section 8(a) program to ac10 curately reflect the dynamics of the modern procure11 ment system so as to better equip minority small 

12 businesses to obtain contracts. 

13 SEC. 202. ADMINISTRATION OF SECTION 8(a) PROGRAM. 

14 (a) MODIFICATIONS TO 8(a) PROGRAM.—Notwith15 standing any provision of the Small Business Act (15 

16 U.S.C. 631 et seq.), the Administrator shall administer 

17 the program under section 8(a) of such Act with the fol18 lowing modifications: 

19 (1) PROGRAM PARTICIPATION REQUIREMENT.— 

20 (A) REQUIREMENT.—No small business 

21 concern shall be eligible to participate in the 

22 program under section 8(a) of the Small Busi23 ness Act (15 U.S.C. 637(a)) before completing 

24 the Program established under section 2. 

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1 (B) WAIVER OF PARTICIPATION REQUIRE2 MENT.—The requirement under subparagraph 

3 (A) may be waived if the Administrator deter4 mines that a small business concern is finan5 cially sound and has successfully completed a 

6 Federal contract. 

7 (2) LIMITATION ON AGGREGATE VALUE OF

8 CONTRACTS.—The aggregate value of the contracts 

9 a participant in the program under such section may 

10 enter into shall not exceed $100,000,000. 

11 (3) ECONOMIC DISADVANTAGE.— 

12 (A) DEADLINE FOR DETERMINATION OF

13 MAXIMUM LEVELS OF NET WORTH.—Not later 

14 than 180 days after the date of the enactment 

15 of this Act, the Administrator shall establish, 

16 for each industry classification, a maximum 

17 level of net worth for an economically disadvan18 taged individual. In establishing such maximum 

19 levels, the Administrator shall take into consid20 eration the capital needs of each industry. 

21 (B) DETERMINATION FOR TERM OF PRO22 GRAM.—For the purpose of this section, an in23 dividual who has been determined by the Ad24 ministrator to be economically disadvantaged at 

25 the time of program entry shall be deemed to 

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1 be economically disadvantaged for the term of 

2 the program. 

3 (C) PERSONAL NET WORTH.—In deter4 mining personal net worth for the purpose of 

5 program entry, the Administrator shall exclude 

6 from such determination the following: 

7 (i) The value of any investment of a 

8 disadvantaged owner have in the small 

9 business concern, except that such value 

10 shall be taken into account under this 

11 paragraph when comparing such concerns 

12 to other concerns in the same business 

13 area that are owned by other than socially 

14 disadvantaged persons. 

15 (ii) The equity of a disadvantaged 

16 owner in a primary personal residence. 

17 (D) MAXIMUM NET WORTH.—The Admin18 istrator shall not establish a maximum net 

19 worth that prohibits program entry of less than 

20 $750,000. 

21 (b) MODIFICATIONS TO DEVELOPMENTAL PHASE.— 

22 (1) ELIGIBILITY FOR RESTRICTED COMPETI23 TION CONTRACTS.—A small business concern par24 ticipating in the developmental phase of such pro25 gram, shall be eligible to enter into a contract 

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1 awarded using procedures other than competitive 

2 procedures that— 

3 (A) is assigned an industrial classification 

4 code for manufacturing and is valued at not 

5 more than $10,000,000; or 

6 (B) is assigned an industrial classification 

7 code other than a code for manufacturing and 

8 is valued at not more than $6,000,0000. 

9 (2) DURATION OF PHASE.—A small business 

10 concern participating in such program shall complete 

11 the developmental phase of the program in six years. 

12 (c) MODIFICATIONS TO TRANSITIONAL PHASE.— 

13 (1) REDUCTION OF SOLE SOURCE CON14 TRACTS.—In each year of the transitional phase, a 

15 small business concern participating in such pro16 gram shall— 

17 (A) reduce by 25 percent the aggregate 

18 value of the contracts it performs that are 

19 awarded using procedures other than competi20 tive procedures; and 

21 (B) increase the aggregate value of the 

22 contracts (awarded under this section or other23 wise) it performs that are awarded using com24 petitive procedures. 

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1 (2) ELIGIBILITY FOR RESTRICTED COMPETI2 TION CONTRACTS.—A small business concern par3 ticipating in the transitional phase of such program, 

4 shall be eligible to enter into a contract awarded 

5 using procedures other than competitive procedures 

6 that— 

7 (A) is assigned an industrial classification 

8 code for manufacturing and is valued at not 

9 more than $10,000,000; or 

10 (B) is assigned an industrial classification 

11 code other than a code for manufacturing and 

12 is valued at not more than $6,000,0000. 

13 (d) EFFECTIVE DATE FOR MODIFICATIONS TO THE

14 8(a) PROGRAM.— 

15 (1) IN GENERAL.—This Act shall apply with re16 spect to small business concerns that apply to the 

17 program under section 8(a) of the Small Business 

18 Act after the date of the enactment of this Act. 

19 (2) TRANSITIONAL RULE.—A small business 

20 concern participating in the program under section 

21 8(a) of the Small Business Act (15 U.S.C. 637(a)) 

22 may participate for not more than ten years. 

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1 TITLE III—POST-8(a) 

2 ASSISTANCE 

3 SEC. 301. PURPOSE. 

4 The purpose of this title is as follows: 

5 (1) To provide a restricted contracting competi6 tion program limited to small business concerns that 

7 have successfully graduated from the section 8(a) 

8 program and certified small disadvantaged busi9 nesses. 

10 (2) To enable 8(a) program graduates to utilize 

11 the expertise they have developed during the pro12 gram. 

13 (3) To increase minority business representa14 tion in the Federal marketplace. 

15 SEC. 302. RETENTION OF STATUS AFTER COMPLETION OF 

16 8(a) PROGRAM. 

17 A small business concern that successfully completes 

18 the program under section 8(a) of the Small Business Act 

19 (15 U.S.C. 637(a)) shall be considered a small disadvan20 taged business for purposes of Government contracting 

21 unless the ownership or control of the small business con22 cern changes. 

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1 SEC. 303. RESTRICTED COMPETITION FOR SMALL BUSI2 NESSES OWNED AND CONTROLLED BY SO3 CIALLY AND ECONOMICALLY DISADVAN4 TAGED INDIVIDUALS. 

5 (a) AUTHORITY TO RESTRICT COMPETITION.—Sec6 tion 8 of the Small Business Act (15 U.S.C. 637(a)) is 

7 amended by adding at the end the following new sub8 section: 

9 ‘‘(o) RESTRICTED COMPETITION FOR SMALL BUSI10 NESSES OWNED AND CONTROLLED BY SOCIALLY AND

11 ECONOMICALLY DISADVANTAGED INDIVIDUALS.— 

12 ‘‘(1) AUTHORITY TO RESTRICT COMPETITION.— 

13 In accordance with this subsection, a contracting of14 ficer may restrict competition for any contract for 

15 the procurement of goods or services by the Federal 

16 Government to small business concerns owned and 

17 controlled by socially and economically disadvan18 taged individuals, if— 

19 ‘‘(A) each of the concerns is not less than 

20 51 percent owned by one or more socially and 

21 economically disadvantaged individuals (and 

22 such ownership is determined without regard to 

23 any community property law); 

24 ‘‘(B) the contracting officer has a reason25 able expectation that two or more small busi26 ness concerns owned and controlled by socially 

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1 and economically disadvantaged individuals will 

2 submit offers for the contract; 

3 ‘‘(C) the contract is for the procurement of 

4 goods or services with respect to an industry 

5 identified by the Secretary of Commerce as 

6 underrepresented by small business concerns 

7 owned and controlled by socially and economi8 cally disadvantaged individuals; 

9 ‘‘(D) the anticipated award price of the 

10 contract (including options) does not exceed— 

11 ‘‘(i) $10,000,000, in the case of a con12 tract assigned an industrial classification 

13 code for manufacturing; or 

14 ‘‘(ii) $6,000,000, in the case of all 

15 other contracts; 

16 ‘‘(E) in the estimation of the contracting 

17 officer, the contract award can be made at a 

18 fair and reasonable price; and 

19 ‘‘(F) each of the concerns— 

20 ‘‘(i) is certified by a Federal agency, 

21 a State government, or a national certi22 fying entity approved by the Adminis23 trator, as a small business concern owned 

24 and controlled by socially and economically 

25 disadvantaged individuals; or 

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1 ‘‘(ii) certifies to the contracting officer 

2 that it is a small business concern owned 

3 and controlled by socially and economically 

4 disadvantaged individuals and provides 

5 adequate documentation, in accordance 

6 with standards established by the Adminis7 tration, to support such certification. 

8 ‘‘(2) ENFORCEMENT; PENALTIES.— 

9 ‘‘(A) VERIFICATION OF ELIGIBILITY.—In 

10 carrying out this subsection, the Administrator 

11 shall establish procedures relating to— 

12 ‘‘(i) the filing, investigation, and dis13 position by the Administration of any chal14 lenge to the eligibility of a small business 

15 concern to receive assistance under this 

16 subsection (including a challenge, filed by 

17 an interested party, relating to the veracity 

18 of a certification made or information pro19 vided to the Administration by a small 

20 business concern under paragraph (1)(F)); 

21 and 

22 ‘‘(ii) verification by the Administrator 

23 of the accuracy of any certification made 

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1 tion by a small business concern under 

2 paragraph (1)(F). 

3 ‘‘(B) EXAMINATIONS.—The procedures es4 tablished under subparagraph (A) may provide 

5 for program examinations (including random 

6 program examinations) by the Administrator of 

7 any small business concern making a certifi8 cation or providing information to the Adminis9 trator under paragraph (1)(F). 

10 ‘‘(C) PENALTIES.—In addition to the pen11 alties described in section 16(d), any small busi12 ness concern that is determined by the Admin13 istrator to have misrepresented the status of 

14 that concern as a small business concern owned 

15 and controlled by socially and economically dis16 advantaged individuals for purposes of this sub17 section, shall be subject to— 

18 ‘‘(i) section 1001 of title 18, United 

19 States Code; and 

20 ‘‘(ii) sections 3729 through 3733 of 

21 title 31, United States Code. 

22 ‘‘(3) PROVISION OF DATA.—Upon the request 

23 of the Administrator, the head of any Federal de24 partment or agency shall promptly provide to the 

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1 trator determines to be necessary to carry out this 

2 subsection. 

3 ‘‘(4) DEFINITIONS.—In this subsection, the fol4 lowing definitions apply: 

5 ‘‘(A) CONTRACTING OFFICER.—The term 

6 ‘contracting officer’ has the meaning given such 

7 term in section 27(f)(5) of the Office of Federal 

8 Procurement Policy Act (41 U.S.C. 423(f)(5)). 

9 ‘‘(B) SMALL BUSINESS CONCERN OWNED

10 AND CONTROLLED BY SOCIALLY AND ECONOMI11 CALLY DISADVANTAGED INDIVIDUALS.—The 

12 term ‘small business concern owned and con13 trolled by socially and economically disadvan14 taged individuals’ has the meaning given such 

15 term under subsection (d)(3)(C).’’. 

16 (b) EFFECTIVE DATE.—The amendments made by 

17 this section shall apply with respect to a contracts an18 nounced after the date of the enactment of this Act. 

Æ 

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