I

106TH CONGRESS

2D SESSION H. R. 5654

To provide for reauthorization of small business loan and other programs,

and for other purposes.

IN THE HOUSE OF REPRESENTATIVES

DECEMBER 13, 2000

Mr. TALENT (for himself and Ms. VELA ́

ZQUEZ) introduced the following bill;

which was referred to the Committee on Small Business

A BILL

To provide for reauthorization of small business loan and

other programs, and for other purposes.

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 ‘‘Small Business Reauthorization Act of 2000’’.

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—SMALL BUSINESS INNOVATION RESEARCH PROGRAM

Sec. 101. Short title.

Sec. 102. Findings.

Sec. 103. Extension of SBIR program.
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Sec. 104. Annual report.

Sec. 105. Third phase assistance.

Sec. 106. Report on programs for annual performance plan.

Sec. 107. Output and outcome data.

Sec. 108. National Research Council reports.

Sec. 109. Federal agency expenditures for the SBIR program.

Sec. 110. Policy directive modifications.

Sec. 111. Federal and State technology partnership program.

Sec. 112. Mentoring networks.

Sec. 113. Simplified reporting requirements.

Sec. 114. Rural outreach program extension.

TITLE II—BUSINESS LOAN PROGRAMS

Sec. 201. Short title.

Sec. 202. Levels of participation.

Sec. 203. Loan amounts.

Sec. 204. Interest on defaulted loans.

Sec. 205. Prepayment of loans.

Sec. 206. Guarantee fees.

Sec. 207. Lease terms.

Sec. 208. Appraisals for loans secured by real property.

Sec. 209. Sale of guaranteed loans made for export purposes.

Sec. 210. Microloan program.

TITLE III—CERTIFIED DEVELOPMENT COMPANY PROGRAM

Sec. 301. Short title.

Sec. 302. Women-owned businesses.

Sec. 303. Maximum debenture size.

Sec. 304. Fees.

Sec. 305. Premier certified lenders program.

Sec. 306. Sale of certain defaulted loans.

Sec. 307. Loan liquidation.

TITLE IV—CORRECTIONS TO THE SMALL BUSINESS INVESTMENT

ACT OF 1958

Sec. 401. Short title.

Sec. 402. Definitions.

Sec. 403. Investment in small business investment companies.

Sec. 404. Subsidy fees.

Sec. 405. Distributions.

Sec. 406. Conforming amendment.

TITLE V—REAUTHORIZATION OF SMALL BUSINESS PROGRAMS

Sec. 501. Short title.

Sec. 502. Reauthorization of small business programs.

Sec. 503. Additional reauthorizations.

Sec. 504. Cosponsorship.

TITLE VI—HUBZONE PROGRAM

Subtitle A—HUBZones in Native America

Sec. 601. Short title.

Sec. 602. HUBZone small business concern.
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Sec. 603. Qualified HUBZone small business concern.

Sec. 604. Other definitions.

Subtitle B—Other HUBZone Provisions

Sec. 611. Definitions.

Sec. 612. Eligible contracts.

Sec. 613. HUBZone redesignated areas.

Sec. 614. Community development.

Sec. 615. Reference corrections.

TITLE VII—NATIONAL WOMEN’S BUSINESS COUNCIL

REAUTHORIZATION

Sec. 701. Short title.

Sec. 702. Membership of the Council.

Sec. 703. Repeal of procurement project.

Sec. 704. Studies and other research.

Sec. 705. Authorization of appropriations.

TITLE VIII—MISCELLANEOUS PROVISIONS

Sec. 801. Loan application processing.

Sec. 802. Application of ownership requirements.

Sec. 803. Subcontracting preference for veterans.

Sec. 804. Small Business Development Center Program funding.

Sec. 805. Surety bonds.

Sec. 806. Size standards.

Sec. 807. Native Hawaiian organizations under section 8(a).

Sec. 808. National Veterans Business Development Corporation correction.

Sec. 809. Private sector resources for SCORE.

Sec. 810. Contract data collection.

Sec. 811. Procurement program for women-owned small business concerns.

TITLE IX—COMMUNITY RENEWAL AND NEW MARKETS

INITIATIVES

Sec. 901. New markets venture capital program.

Sec. 902. BusinessLINC grants and cooperative agreements.

1 TITLE I—SMALL BUSINESS INNO2 VATION RESEARCH PROGRAM

3 SECTION 101. SHORT TITLE.

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

5 ‘‘Small Business Innovation Research Program Reauthor6 ization Act of 2000’’.

7 SEC. 102. FINDINGS.

8 Congress finds that—
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1 (1) the small business innovation research pro2 gram established under the Small Business Innova3 tion Development Act of 1982, and reauthorized by

4 the Small Business Research and Development En5 hancement Act of 1992 (in this title referred to as

6 the ‘‘SBIR program’’) is highly successful in involv7 ing small businesses in federally funded research

8 and development;

9 (2) the SBIR program made the cost-effective

10 and unique research and development capabilities

11 possessed by the small businesses of the Nation

12 available to Federal agencies and departments;

13 (3) the innovative goods and services developed

14 by small businesses that participated in the SBIR

15 program have produced innovations of critical impor16 tance in a wide variety of high-technology fields, in17 cluding biology, medicine, education, and defense;

18 (4) the SBIR program is a catalyst in the pro19 motion of research and development, the commer20 cialization of innovative technology, the development

21 of new products and services, and the continued ex22 cellence of this Nation’s high-technology industries;

23 and

24 (5) the continuation of the SBIR program will

25 provide expanded opportunities for one of the Na-
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1 tion’s vital resources, its small businesses, will foster

2 invention, research, and technology, will create jobs,

3 and will increase this Nation’s competitiveness in

4 international markets.

5 SEC. 103. EXTENSION OF SBIR PROGRAM.

6 Section 9(m) of the Small Business Act (15 U.S.C.

7 638(m)) is amended to read as follows:

8 ‘‘(m) TERMINATION.—The authorization to carry out

9 the Small Business Innovation Research Program estab10 lished under this section shall terminate on September 30,

11 2008.’’.

12 SEC. 104. ANNUAL REPORT.

13 Section 9(b)(7) of the Small Business Act (15 U.S.C.

14 638(b)(7)) is amended by striking ‘‘and the Committee on

15 Small Business of the House of Representatives’’ and in16 serting ‘‘, and to the Committee on Science and the Com17 mittee on Small Business of the House of Representa18 tives,’’.

19 SEC. 105. THIRD PHASE ASSISTANCE.

20 Section 9(e)(4)(C)(i) of the Small Business Act (15

21 U.S.C. 638(e)(4)(C)(i)) is amended by striking ‘‘; and’’

22 and inserting ‘‘; or’’.
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1 SEC. 106. REPORT ON PROGRAMS FOR ANNUAL PERFORM2 ANCE PLAN.

3 Section 9(g) of the Small Business Act (15 U.S.C.

4 638(g)) is amended—

5 (1) in paragraph (7), by striking ‘‘and’’ at the

6 end;

7 (2) in paragraph (8), by striking the period at

8 the end and inserting a semicolon; and

9 (3) by adding at the end the following:

10 ‘‘(9) include, as part of its annual performance

11 plan as required by subsections (a) and (b) of sec12 tion 1115 of title 31, United States Code, a section

13 on its SBIR program, and shall submit such section

14 to the Committee on Small Business of the Senate,

15 and the Committee on Science and the Committee

16 on Small Business of the House of Representatives;

17 and’’.

18 SEC. 107. OUTPUT AND OUTCOME DATA.

19 (a) COLLECTION.—Section 9(g) of the Small Busi20 ness Act (15 U.S.C. 638(g)), as amended by section 106

21 of this Act, is further amended by adding at the end the

22 following:

23 ‘‘(10) collect, and maintain in a common format

24 in accordance with subsection (v), such information

25 from awardees as is necessary to assess the SBIR
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1 program, including information necessary to main2 tain the database described in subsection (k).’’.

3 (b) REPORT TO CONGRESS.—Section 9(b)(7) of the

4 Small Business Act (15 U.S.C. 638(b)(7)), as amended

5 by section 104 of this Act, is further amended by inserting

6 before the period at the end ‘‘, including the data on out7 put and outcomes collected pursuant to subsections

8 (g)(10) and (o)(9), and a description of the extent to

9 which Federal agencies are providing in a timely manner

10 information needed to maintain the database described in

11 subsection (k)’’.

12 (c) DATABASE.—Section 9(k) of the Small Business

13 Act (15 U.S.C. 638(k)) is amended to read as follows:

14 ‘‘(k) DATABASE.—

15 ‘‘(1) PUBLIC DATABASE.—Not later than 180

16 days after the date of enactment of the Small Busi17 ness Innovation Research Program Reauthorization

18 Act of 2000, the Administrator shall develop, main19 tain, and make available to the public a searchable,

20 up-to-date, electronic database that includes—

21 ‘‘(A) the name, size, location, and an iden22 tifying number assigned by the Administrator,

23 of each small business concern that has received

24 a first phase or second phase SBIR award from

25 a Federal agency;
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1 ‘‘(B) a description of each first phase or

2 second phase SBIR award received by that

3 small business concern, including—

4 ‘‘(i) an abstract of the project funded

5 by the award, excluding any proprietary in6 formation so identified by the small busi7 ness concern;

8 ‘‘(ii) the Federal agency making the

9 award; and

10 ‘‘(iii) the date and amount of the

11 award;

12 ‘‘(C) an identification of any business con13 cern or subsidiary established for the commer14 cial application of a product or service for

15 which an SBIR award is made; and

16 ‘‘(D) information regarding mentors and

17 Mentoring Networks, as required by section

18 35(d).

19 ‘‘(2) GOVERNMENT DATABASE.—Not later than

20 180 days after the date of enactment of the Small

21 Business Innovation Research Program Reauthoriza22 tion Act of 2000, the Administrator, in consultation

23 with Federal agencies required to have an SBIR

24 program pursuant to subsection (f)(1), shall develop
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1 and maintain a database to be used solely for SBIR

2 program evaluation that—

3 ‘‘(A) contains for each second phase award

4 made by a Federal agency—

5 ‘‘(i) information collected in accord6 ance with paragraph (3) on revenue from

7 the sale of new products or services result8 ing from the research conducted under the

9 award;

10 ‘‘(ii) information collected in accord11 ance with paragraph (3) on additional in12 vestment from any source, other than first

13 phase or second phase SBIR or STTR

14 awards, to further the research and devel15 opment conducted under the award; and

16 ‘‘(iii) any other information received

17 in connection with the award that the Ad18 ministrator, in conjunction with the SBIR

19 program managers of Federal agencies,

20 considers relevant and appropriate;

21 ‘‘(B) includes any narrative information

22 that a small business concern receiving a second

23 phase award voluntarily submits to further de24 scribe the outputs and outcomes of its awards;
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1 ‘‘(C) includes for each applicant for a first

2 phase or second phase award that does not re3 ceive such an award—

4 ‘‘(i) the name, size, and location, and

5 an identifying number assigned by the Ad6 ministration;

7 ‘‘(ii) an abstract of the project; and

8 ‘‘(iii) the Federal agency to which the

9 application was made;

10 ‘‘(D) includes any other data collected by

11 or available to any Federal agency that such

12 agency considers may be useful for SBIR pro13 gram evaluation; and

14 ‘‘(E) is available for use solely for program

15 evaluation purposes by the Federal Government

16 or, in accordance with policy directives issued

17 by the Administration, by other authorized per18 sons who are subject to a use and nondisclosure

19 agreement with the Federal Government cov20 ering the use of the database.

21 ‘‘(3) UPDATING INFORMATION FOR DATA22 BASE.—

23 ‘‘(A) IN GENERAL.—A small business con24 cern applying for a second phase award under

25 this section shall be required to update informa-
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1 tion in the database established under this sub2 section for any prior second phase award re3 ceived by that small business concern. In com4 plying with this paragraph, a small business

5 concern may apportion sales or additional in6 vestment information relating to more than one

7 second phase award among those awards, if it

8 notes the apportionment for each award.

9 ‘‘(B) ANNUAL UPDATES UPON TERMI10 NATION.—A small business concern receiving a

11 second phase award under this section shall—

12 ‘‘(i) update information in the data13 base concerning that award at the termi14 nation of the award period; and

15 ‘‘(ii) be requested to voluntarily up16 date such information annually thereafter

17 for a period of 5 years.

18 ‘‘(4) PROTECTION OF INFORMATION.—Informa19 tion provided under paragraph (2) shall be consid20 ered privileged and confidential and not subject to

21 disclosure pursuant to section 552 of title 5, United

22 States Code.

23 ‘‘(5) RULE OF CONSTRUCTION.—Inclusion of

24 information in the database under this subsection

25 shall not be considered to be publication for pur-
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1 poses of subsection (a) or (b) of section 102 of title

2 35, United States Code.’’.

3 SEC. 108. NATIONAL RESEARCH COUNCIL REPORTS.

4 (a) STUDY AND RECOMMENDATIONS.—The head of

5 each agency with a budget of more than $50,000,000 for

6 its SBIR program for fiscal year 1999, in consultation

7 with the Small Business Administration, shall, not later

8 than 6 months after the date of enactment of this Act,

9 cooperatively enter into an agreement with the National

10 Academy of Sciences for the National Research Council

11 to—

12 (1) conduct a comprehensive study of how the

13 SBIR program has stimulated technological innova14 tion and used small businesses to meet Federal re15 search and development needs, including—

16 (A) a review of the value to the Federal re17 search agencies of the research projects being

18 conducted under the SBIR program, and of the

19 quality of research being conducted by small

20 businesses participating under the program, in21 cluding a comparison of the value of projects

22 conducted under the SBIR program to those

23 funded by other Federal research and develop24 ment expenditures;
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1 (B) to the extent practicable, an evaluation

2 of the economic benefits achieved by the SBIR

3 program, including the economic rate of return,

4 and a comparison of the economic benefits, in5 cluding the economic rate of return, achieved by

6 the SBIR program with the economic benefits,

7 including the economic rate of return, of other

8 Federal research and development expenditures;

9 (C) an evaluation of the noneconomic bene10 fits achieved by the SBIR program over the life

11 of the program;

12 (D) a comparison of the allocation for fis13 cal year 2000 of Federal research and develop14 ment funds to small businesses with such allo15 cation for fiscal year 1983, and an analysis of

16 the factors that have contributed to such alloca17 tion; and

18 (E) an analysis of whether Federal agen19 cies, in fulfilling their procurement needs, are

20 making sufficient effort to use small businesses

21 that have completed a second phase award

22 under the SBIR program; and

23 (2) make recommendations with respect to—

24 (A) measures of outcomes for strategic

25 plans submitted under section 306 of title 5,
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1 United States Code, and performance plans

2 submitted under section 1115 of title 31,

3 United States Code, of each Federal agency

4 participating in the SBIR program;

5 (B) whether companies who can dem6 onstrate project feasibility, but who have not re7 ceived a first phase award, should be eligible for

8 second phase awards, and the potential impact

9 of such awards on the competitive selection

10 process of the program;

11 (C) whether the Federal Government

12 should be permitted to recoup some or all of its

13 expenses if a controlling interest in a company

14 receiving an SBIR award is sold to a foreign

15 company or to a company that is not a small

16 business concern;

17 (D) how to increase the use by the Federal

18 Government in its programs and procurements

19 of technology-oriented small businesses; and

20 (E) improvements to the SBIR program, if

21 any are considered appropriate.

22 (b) PARTICIPATION BY SMALL BUSINESS.—

23 (1) IN GENERAL.—In a manner consistent with

24 law and with National Research Council study

25 guidelines and procedures, knowledgeable individuals
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1 from the small business community with experience

2 in the SBIR program shall be included—

3 (A) in any panel established by the Na4 tional Research Council for the purpose of per5 forming the study conducted under this section;

6 and

7 (B) among those who are asked by the Na8 tional Research Council to peer review the

9 study.

10 (2) CONSULTATION.—To ensure that the con11 cerns of small business are appropriately considered

12 under this subsection, the National Research Council

13 shall consult with and consider the views of the Of14 fice of Technology and the Office of Advocacy of the

15 Small Business Administration and other interested

16 parties, including entities, organizations, and indi17 viduals actively engaged in enhancing or developing

18 the technological capabilities of small business con19 cerns.

20 (c) PROGRESS REPORTS.—The National Research

21 Council shall provide semiannual progress reports on the

22 study conducted under this section to the Committee on

23 Science and the Committee on Small Business of the

24 House of Representatives, and to the Committee on Small

25 Business of the Senate.
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1 (d) REPORT.—The National Research Council shall

2 transmit to the heads of agencies entering into an agree3 ment under this section and to the Committee on Science

4 and the Committee on Small Business of the House of

5 Representatives, and to the Committee on Small Business

6 of the Senate—

7 (1) not later than 3 years after the date of en8 actment of this Act, a report including the results of

9 the study conducted under subsection (a)(1) and rec10 ommendations made under subsection (a)(2); and

11 (2) not later than 6 years after that date of en12 actment, an update of such report.

13 SEC. 109. FEDERAL AGENCY EXPENDITURES FOR THE SBIR

14 PROGRAM.

15 Section 9(i) of the Small Business Act (15 U.S.C.

16 638(i)) is amended—

17 (1) by striking ‘‘(i) Each Federal’’ and insert18 ing the following:

19 ‘‘(i) ANNUAL REPORTING.—

20 ‘‘(1) IN GENERAL.—Each Federal’’; and

21 (2) by adding at the end the following:

22 ‘‘(2) CALCULATION OF EXTRAMURAL BUDG23 ET.—

24 ‘‘(A) METHODOLOGY.—Not later than 4

25 months after the date of enactment of each ap-
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1 propriations Act for a Federal agency required

2 by this section to have an SBIR program, the

3 Federal agency shall submit to the Adminis4 trator a report, which shall include a descrip5 tion of the methodology used for calculating the

6 amount of the extramural budget of that Fed7 eral agency.

8 ‘‘(B) ADMINISTRATOR’S ANALYSIS.—The

9 Administrator shall include an analysis of the

10 methodology received from each Federal agency

11 referred to in subparagraph (A) in the report

12 required by subsection (b)(7).’’.

13 SEC. 110. POLICY DIRECTIVE MODIFICATIONS.

14 Section 9(j) of the Small Business Act (15 U.S.C.

15 638(j)) is amended by adding at the end the following:

16 ‘‘(3) ADDITIONAL MODIFICATIONS.—Not later

17 than 120 days after the date of enactment of the

18 Small Business Innovation Research Program Reau19 thorization Act of 2000, the Administrator shall

20 modify the policy directives issued pursuant to this

21 subsection—

22 ‘‘(A) to clarify that the rights provided for

23 under paragraph (2)(A) apply to all Federal

24 funding awards under this section, including

25 the first phase (as described in subsection
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1 (e)(4)(A)), the second phase (as described in

2 subsection (e)(4)(B)), and the third phase (as

3 described in subsection (e)(4)(C));

4 ‘‘(B) to provide for the requirement of a

5 succinct commercialization plan with each appli6 cation for a second phase award that is moving

7 toward commercialization;

8 ‘‘(C) to require agencies to report to the

9 Administration, not less frequently than annu10 ally, all instances in which an agency pursued

11 research, development, or production of a tech12 nology developed by a small business concern

13 using an award made under the SBIR program

14 of that agency, and determined that it was not

15 practicable to enter into a follow-on non-SBIR

16 program funding agreement with the small

17 business concern, which report shall include, at

18 a minimum—

19 ‘‘(i) the reasons why the follow-on

20 funding agreement with the small business

21 concern was not practicable;

22 ‘‘(ii) the identity of the entity with

23 which the agency contracted to perform

24 the research, development, or production;

25 and
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1 ‘‘(iii) a description of the type of

2 funding agreement under which the re3 search, development, or production was ob4 tained; and

5 ‘‘(D) to implement subsection (v), includ6 ing establishing standardized procedures for the

7 provision of information pursuant to subsection

8 (k)(3).’’.

9 SEC. 111. FEDERAL AND STATE TECHNOLOGY PARTNER10 SHIP PROGRAM.

11 (a) FINDINGS.—Congress finds that—

12 (1) programs to foster economic development

13 among small high-technology firms vary widely

14 among the States;

15 (2) States that do not aggressively support the

16 development of small high-technology firms, includ17 ing participation by small business concerns in the

18 SBIR program, are at a competitive disadvantage in

19 establishing a business climate that is conducive to

20 technology development; and

21 (3) building stronger national, State, and local

22 support for science and technology research in these

23 disadvantaged States will expand economic opportu24 nities in the United States, create jobs, and increase
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1 the competitiveness of the United States in the

2 world market.

3 (b) FEDERAL AND STATE TECHNOLOGY PARTNER4 SHIP PROGRAM.—The Small Business Act (15 U.S.C. 631

5 et seq.) is amended—

6 (1) by redesignating section 34 as section 36;

7 and

8 (2) by inserting after section 33 the following:

9 ‘‘SEC. 34. FEDERAL AND STATE TECHNOLOGY PARTNER10 SHIP PROGRAM.

11 ‘‘(a) DEFINITIONS.—In this section and section 35,

12 the following definitions apply:

13 ‘‘(1) APPLICANT.—The term ‘applicant’ means

14 an entity, organization, or individual that submits a

15 proposal for an award or a cooperative agreement

16 under this section.

17 ‘‘(2) BUSINESS ADVICE AND COUNSELING.—

18 The term ‘business advice and counseling’ means

19 providing advice and assistance on matters described

20 in section 35(c)(2)(B) to small business concerns to

21 guide them through the SBIR and STTR program

22 process, from application to award and successful

23 completion of each phase of the program.
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1 ‘‘(3) FAST PROGRAM.—The term ‘FAST pro2 gram’ means the Federal and State Technology

3 Partnership Program established under this section.

4 ‘‘(4) MENTOR.—The term ‘mentor’ means an

5 individual described in section 35(c)(2).

6 ‘‘(5) MENTORING NETWORK.—The term ‘Men7 toring Network’ means an association, organization,

8 coalition, or other entity (including an individual)

9 that meets the requirements of section 35(c).

10 ‘‘(6) RECIPIENT.—The term ‘recipient’ means a

11 person that receives an award or becomes party to

12 a cooperative agreement under this section.

13 ‘‘(7) SBIR PROGRAM.—The term ‘SBIR pro14 gram’ has the same meaning as in section 9(e)(4).

15 ‘‘(8) STATE.—The term ‘State’ means each of

16 the several States, the District of Columbia, the

17 Commonwealth of Puerto Rico, the Virgin Islands,

18 Guam, and American Samoa.

19 ‘‘(9) STTR PROGRAM.—The term ‘STTR pro20 gram’ has the same meaning as in section 9(e)(6).

21 ‘‘(b) ESTABLISHMENT OF PROGRAM.—The Adminis22 trator shall establish a program to be known as the Fed23 eral and State Technology Partnership Program, the pur24 pose of which shall be to strengthen the technological com25 petitiveness of small business concerns in the States.
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1 ‘‘(c) GRANTS AND COOPERATIVE AGREEMENTS.—

2 ‘‘(1) JOINT REVIEW.—In carrying out the

3 FAST program under this section, the Adminis4 trator and the SBIR program managers at the Na5 tional Science Foundation and the Department of

6 Defense shall jointly review proposals submitted by

7 applicants and may make awards or enter into coop8 erative agreements under this section based on the

9 factors for consideration set forth in paragraph (2),

10 in order to enhance or develop in a State—

11 ‘‘(A) technology research and development

12 by small business concerns;

13 ‘‘(B) technology transfer from university

14 research to technology-based small business

15 concerns;

16 ‘‘(C) technology deployment and diffusion

17 benefiting small business concerns;

18 ‘‘(D) the technological capabilities of small

19 business concerns through the establishment or

20 operation of consortia comprised of entities, or21 ganizations, or individuals, including—

22 ‘‘(i) State and local development agen23 cies and entities;

24 ‘‘(ii) representatives of technology25 based small business concerns;
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1 ‘‘(iii) industries and emerging compa2 nies;

3 ‘‘(iv) universities; and

4 ‘‘(v) small business development cen5 ters; and

6 ‘‘(E) outreach, financial support, and tech7 nical assistance to technology-based small busi8 ness concerns participating in or interested in

9 participating in an SBIR program, including

10 initiatives—

11 ‘‘(i) to make grants or loans to com12 panies to pay a portion or all of the cost

13 of developing SBIR proposals;

14 ‘‘(ii) to establish or operate a Men15 toring Network within the FAST program

16 to provide business advice and counseling

17 that will assist small business concerns

18 that have been identified by FAST pro19 gram participants, program managers of

20 participating SBIR agencies, the Adminis21 tration, or other entities that are knowl22 edgeable about the SBIR and STTR pro23 grams as good candidates for the SBIR

24 and STTR programs, and that would ben-
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1 efit from mentoring, in accordance with

2 section 35;

3 ‘‘(iii) to create or participate in a

4 training program for individuals providing

5 SBIR outreach and assistance at the State

6 and local levels; and

7 ‘‘(iv) to encourage the commercializa8 tion of technology developed through SBIR

9 program funding.

10 ‘‘(2) SELECTION CONSIDERATIONS.—In making

11 awards or entering into cooperative agreements

12 under this section, the Administrator and the SBIR

13 program managers referred to in paragraph (1)—

14 ‘‘(A) may only consider proposals by appli15 cants that intend to use a portion of the Fed16 eral assistance provided under this section to

17 provide outreach, financial support, or technical

18 assistance to technology-based small business

19 concerns participating in or interested in par20 ticipating in the SBIR program; and

21 ‘‘(B) shall consider, at a minimum—

22 ‘‘(i) whether the applicant has dem23 onstrated that the assistance to be pro24 vided would address unmet needs of small

25 business concerns in the community, and
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1 whether it is important to use Federal

2 funding for the proposed activities;

3 ‘‘(ii) whether the applicant has dem4 onstrated that a need exists to increase the

5 number or success of small high-technology

6 businesses in the State, as measured by

7 the number of first phase and second

8 phase SBIR awards that have historically

9 been received by small business concerns in

10 the State;

11 ‘‘(iii) whether the projected costs of

12 the proposed activities are reasonable;

13 ‘‘(iv) whether the proposal integrates

14 and coordinates the proposed activities

15 with other State and local programs assist16 ing small high-technology firms in the

17 State; and

18 ‘‘(v) the manner in which the appli19 cant will measure the results of the activi20 ties to be conducted.

21 ‘‘(3) PROPOSAL LIMIT.—Not more than 1 pro22 posal may be submitted for inclusion in the FAST

23 program under this section to provide services in any

24 one State in any 1 fiscal year.
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1 ‘‘(4) PROCESS.—Proposals and applications for

2 assistance under this section shall be in such form

3 and subject to such procedures as the Administrator

4 shall establish.

5 ‘‘(d) COOPERATION AND COORDINATION.—In car6 rying out the FAST program under this section, the Ad7 ministrator shall cooperate and coordinate with—

8 ‘‘(1) Federal agencies required by section 9 to

9 have an SBIR program; and

10 ‘‘(2) entities, organizations, and individuals ac11 tively engaged in enhancing or developing the tech12 nological capabilities of small business concerns,

13 including—

14 ‘‘(A) State and local development agencies

15 and entities;

16 ‘‘(B) State committees established under

17 the Experimental Program to Stimulate Com18 petitive Research of the National Science Foun19 dation (as established under section 113 of the

20 National Science Foundation Authorization Act

21 of 1988 (42 U.S.C. 1862g));

22 ‘‘(C) State science and technology councils;

23 and

24 ‘‘(D) representatives of technology-based

25 small business concerns.
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1 ‘‘(e) ADMINISTRATIVE REQUIREMENTS.—

2 ‘‘(1) COMPETITIVE BASIS.—Awards and cooper3 ative agreements under this section shall be made or

4 entered into, as applicable, on a competitive basis.

5 ‘‘(2) MATCHING REQUIREMENTS.—

6 ‘‘(A) IN GENERAL.—The non-Federal

7 share of the cost of an activity (other than a

8 planning activity) carried out using an award or

9 under a cooperative agreement under this sec10 tion shall be—

11 ‘‘(i) 50 cents for each Federal dollar,

12 in the case of a recipient that will serve

13 small business concerns located in one of

14 the 18 States receiving the fewest SBIR

15 first phase awards (as described in section

16 9(e)(4)(A));

17 ‘‘(ii) except as provided in subpara18 graph (B), 1 dollar for each Federal dollar,

19 in the case of a recipient that will serve

20 small business concerns located in one of

21 the 16 States receiving the greatest num22 ber of such SBIR first phase awards; and

23 ‘‘(iii) except as provided in subpara24 graph (B), 75 cents for each Federal dol25 lar, in the case of a recipient that will
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1 serve small business concerns located in a

2 State that is not described in clause (i) or

3 (ii) that is receiving such SBIR first phase

4 awards.

5 ‘‘(B) LOW-INCOME AREAS.—The non-Fed6 eral share of the cost of the activity carried out

7 using an award or under a cooperative agree8 ment under this section shall be 50 cents for

9 each Federal dollar that will be directly allo10 cated by a recipient described in subparagraph

11 (A) to serve small business concerns located in

12 a qualified census tract, as that term is defined

13 in section 42(d)(5)(C)(ii) of the Internal Rev14 enue Code of 1986. Federal dollars not so allo15 cated by that recipient shall be subject to the

16 matching requirements of subparagraph (A).

17 ‘‘(C) TYPES OF FUNDING.—The non-Fed18 eral share of the cost of an activity carried out

19 by a recipient shall be comprised of not less

20 than 50 percent cash and not more than 50

21 percent of indirect costs and in-kind contribu22 tions, except that no such costs or contributions

23 may be derived from funds from any other Fed24 eral program.
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1 ‘‘(D) RANKINGS.—For purposes of sub2 paragraph (A), the Administrator shall reevalu3 ate the ranking of a State once every 2 fiscal

4 years, beginning with fiscal year 2001, based on

5 the most recent statistics compiled by the Ad6 ministrator.

7 ‘‘(3) DURATION.—Awards may be made or co8 operative agreements entered into under this section

9 for multiple years, not to exceed 5 years in total.

10 ‘‘(f) REPORTS.—

11 ‘‘(1) INITIAL REPORT.—Not later than 120

12 days after the date of enactment of the Small Busi13 ness Innovation Research Program Reauthorization

14 Act of 2000, the Administrator shall prepare and

15 submit to the Committee on Small Business of the

16 Senate and the Committee on Science and the Com17 mittee on Small Business of the House of Rep18 resentatives a report, which shall include, with re19 spect to the FAST program, including Mentoring

20 Networks—

21 ‘‘(A) a description of the structure and

22 procedures of the program;

23 ‘‘(B) a management plan for the program;

24 and
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1 ‘‘(C) a description of the merit-based re2 view process to be used in the program.

3 ‘‘(2) ANNUAL REPORTS.—The Administrator

4 shall submit an annual report to the Committee on

5 Small Business of the Senate and the Committee on

6 Science and the Committee on Small Business of the

7 House of Representatives regarding—

8 ‘‘(A) the number and amount of awards

9 provided and cooperative agreements entered

10 into under the FAST program during the pre11 ceding year;

12 ‘‘(B) a list of recipients under this section,

13 including their location and the activities being

14 performed with the awards made or under the

15 cooperative agreements entered into; and

16 ‘‘(C) the Mentoring Networks and the

17 mentoring database, as provided for under sec18 tion 35, including—

19 ‘‘(i) the status of the inclusion of

20 mentoring information in the database re21 quired by section 9(k); and

22 ‘‘(ii) the status of the implementation

23 and description of the usage of the Men24 toring Networks.

25 ‘‘(g) REVIEWS BY INSPECTOR GENERAL.—
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1 ‘‘(1) IN GENERAL.—The Inspector General of

2 the Administration shall conduct a review of—

3 ‘‘(A) the extent to which recipients under

4 the FAST program are measuring the perform5 ance of the activities being conducted and the

6 results of such measurements; and

7 ‘‘(B) the overall management and effective8 ness of the FAST program.

9 ‘‘(2) REPORT.—During the first quarter of fis10 cal year 2004, the Inspector General of the Adminis11 tration shall submit a report to the Committee on

12 Small Business of the Senate and the Committee on

13 Science and the Committee on Small Business of the

14 House of Representatives on the review conducted

15 under paragraph (1).

16 ‘‘(h) PROGRAM LEVELS.—

17 ‘‘(1) IN GENERAL.—There is authorized to be

18 appropriated to carry out the FAST program, in19 cluding Mentoring Networks, under this section and

20 section 35, $10,000,000 for each of fiscal years

21 2001 through 2005.

22 ‘‘(2) MENTORING DATABASE.—Of the total

23 amount made available under paragraph (1) for fis24 cal years 2001 through 2005, a reasonable amount,
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1 not to exceed a total of $500,000, may be used by

2 the Administration to carry out section 35(d).

3 ‘‘(i) TERMINATION.—The authority to carry out the

4 FAST program under this section shall terminate on Sep5 tember 30, 2005.’’.

6 (c) COORDINATION OF TECHNOLOGY DEVELOPMENT

7 PROGRAMS.—Section 9 of the Small Business Act (15

8 U.S.C. 638) is amended by adding at the end the fol9 lowing:

10 ‘‘(u) COORDINATION OF TECHNOLOGY DEVELOP11 MENT PROGRAMS.—

12 ‘‘(1) DEFINITION OF TECHNOLOGY DEVELOP13 MENT PROGRAM.—In this subsection, the term ‘tech14 nology development program’ means—

15 ‘‘(A) the Experimental Program to Stimu16 late Competitive Research of the National

17 Science Foundation, as established under sec18 tion 113 of the National Science Foundation

19 Authorization Act of 1988 (42 U.S.C. 1862g);

20 ‘‘(B) the Defense Experimental Program

21 to Stimulate Competitive Research of the De22 partment of Defense;

23 ‘‘(C) the Experimental Program to Stimu24 late Competitive Research of the Department of

25 Energy;
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1 ‘‘(D) the Experimental Program to Stimu2 late Competitive Research of the Environmental

3 Protection Agency;

4 ‘‘(E) the Experimental Program to Stimu5 late Competitive Research of the National Aero6 nautics and Space Administration;

7 ‘‘(F) the Institutional Development Award

8 Program of the National Institutes of Health;

9 and

10 ‘‘(G) the National Research Initiative

11 Competitive Grants Program of the Department

12 of Agriculture.

13 ‘‘(2) COORDINATION REQUIREMENTS.—Each

14 Federal agency that is subject to subsection (f) and

15 that has established a technology development pro16 gram may, in each fiscal year, review for funding

17 under that technology development program—

18 ‘‘(A) any proposal to provide outreach and

19 assistance to 1 or more small business concerns

20 interested in participating in the SBIR pro21 gram, including any proposal to make a grant

22 or loan to a company to pay a portion or all of

23 the cost of developing an SBIR proposal, from

24 an entity, organization, or individual located

25 in—
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1 ‘‘(i) a State that is eligible to partici2 pate in that program; or

3 ‘‘(ii) a State described in paragraph

4 (3); or

5 ‘‘(B) any proposal for the first phase of

6 the SBIR program, if the proposal, though mer7 itorious, is not funded through the SBIR pro8 gram for that fiscal year due to funding re9 straints, from a small business concern located

10 in—

11 ‘‘(i) a State that is eligible to partici12 pate in a technology development program;

13 or

14 ‘‘(ii) a State described in paragraph

15 (3).

16 ‘‘(3) ADDITIONALLY ELIGIBLE STATE.—A State

17 referred to in subparagraph (A)(ii) or (B)(ii) of

18 paragraph (2) is a State in which the total value of

19 contracts awarded to small business concerns under

20 all SBIR programs is less than the total value of

21 contracts awarded to small business concerns in a

22 majority of other States, as determined by the Ad23 ministrator in biennial fiscal years, beginning with

24 fiscal year 2000, based on the most recent statistics

25 compiled by the Administrator.’’.
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1 SEC. 112. MENTORING NETWORKS.

2 The Small Business Act (15 U.S.C. 631 et seq.) is

3 amended by inserting after section 34, as added by section

4 111(b)(2) of this Act, the following:

5 ‘‘SEC. 35. MENTORING NETWORKS.

6 ‘‘(a) FINDINGS.—Congress finds that—

7 ‘‘(1) the SBIR and STTR programs create

8 jobs, increase capacity for technological innovation,

9 and boost international competitiveness;

10 ‘‘(2) increasing the quantity of applications

11 from all States to the SBIR and STTR programs

12 would enhance competition for such awards and the

13 quality of the completed projects; and

14 ‘‘(3) mentoring is a natural complement to the

15 FAST program of reaching out to new companies

16 regarding the SBIR and STTR programs as an ef17 fective and low-cost way to improve the likelihood

18 that such companies will succeed in such programs

19 in developing and commercializing their research.

20 ‘‘(b) AUTHORIZATION FOR MENTORING NET21 WORKS.—The recipient of an award or participant in a

22 cooperative agreement under section 34 may use a reason23 able amount of such assistance for the establishment of

24 a Mentoring Network under this section.
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1 ‘‘(c) CRITERIA FOR MENTORING NETWORKS.—A

2 Mentoring Network established using assistance under

3 section 34 shall—

4 ‘‘(1) provide business advice and counseling to

5 high technology small business concerns located in

6 the State or region served by the Mentoring Net7 work and identified under section 34(c)(1)(E)(ii) as

8 potential candidates for the SBIR or STTR pro9 grams;

10 ‘‘(2) identify volunteer mentors who—

11 ‘‘(A) are persons associated with a small

12 business concern that has successfully com13 pleted one or more SBIR or STTR funding

14 agreements; and

15 ‘‘(B) have agreed to guide small business

16 concerns through all stages of the SBIR or

17 STTR program process, including providing as18 sistance relating to—

19 ‘‘(i) proposal writing;

20 ‘‘(ii) marketing;

21 ‘‘(iii) Government accounting;

22 ‘‘(iv) Government audits;

23 ‘‘(v) project facilities and equipment;

24 ‘‘(vi) human resources;

25 ‘‘(vii) third phase partners;
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•HR 5654 IH

1 ‘‘(viii) commercialization;

2 ‘‘(ix) venture capital networking; and

3 ‘‘(x) other matters relevant to the

4 SBIR and STTR programs;

5 ‘‘(3) have experience working with small busi6 ness concerns participating in the SBIR and STTR

7 programs;

8 ‘‘(4) contribute information to the national

9 database referred to in subsection (d); and

10 ‘‘(5) agree to reimburse volunteer mentors for

11 out-of-pocket expenses related to service as a mentor

12 under this section.

13 ‘‘(d) MENTORING DATABASE.—The Administrator

14 shall—

15 ‘‘(1) include in the database required by section

16 9(k)(1), in cooperation with the SBIR, STTR, and

17 FAST programs, information on Mentoring Net18 works and mentors participating under this section,

19 including a description of their areas of expertise;

20 ‘‘(2) work cooperatively with Mentoring Net21 works to maintain and update the database;

22 ‘‘(3) take such action as may be necessary to

23 aggressively promote Mentoring Networks under this

24 section; and
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1 ‘‘(4) fulfill the requirements of this subsection

2 either directly or by contract.’’.

3 SEC. 113. SIMPLIFIED REPORTING REQUIREMENTS.

4 Section 9 of the Small Business Act (15 U.S.C. 638),

5 as amended by this Act, is further amended by adding

6 at the end the following:

7 ‘‘(v) SIMPLIFIED REPORTING REQUIREMENTS.—The

8 Administrator shall work with the Federal agencies re9 quired by this section to have an SBIR program to stand10 ardize reporting requirements for the collection of data

11 from SBIR applicants and awardees, including data for

12 inclusion in the database under subsection (k), taking into

13 consideration the unique needs of each agency, and to the

14 extent possible, permitting the updating of previously re15 ported information by electronic means. Such require16 ments shall be designed to minimize the burden on small

17 businesses.’’.

18 SEC. 114. RURAL OUTREACH PROGRAM EXTENSION.

19 (a) EXTENSION OF TERMINATION DATE.—Section

20 501(b)(2) of the Small Business Reauthorization Act of

21 1997 (15 U.S.C. 638 note; 111 Stat. 2622) is amended

22 by striking ‘‘2001’’ and inserting ‘‘2005’’.

23 (b) EXTENSION OF AUTHORIZATION OF APPROPRIA24 TIONS.—Section 9(s)(2) of the Small Business Act (15

25 U.S.C. 638(s)(2)) is amended by striking ‘‘for fiscal year
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1 1998, 1999, 2000, or 2001’’ and inserting ‘‘for each of

2 the fiscal years 2000 through 2005,’’.

3 TITLE II—BUSINESS LOAN

4 PROGRAMS

5 SEC. 201. SHORT TITLE.

6 This title may be cited as the ‘‘Small Business Loan

7 Improvement Act of 2000’’.

8 SEC. 202. LEVELS OF PARTICIPATION.

9 Section 7(a)(2)(A) of the Small Business Act (15

10 U.S.C. 636(a)(2)(A)) is amended—

11 (1) in paragraph (i) by striking ‘‘$100,000’’

12 and inserting ‘‘$150,000’’; and

13 (2) in paragraph (ii)—

14 (A) by striking ‘‘80 percent’’ and inserting

15 ‘‘85 percent’’; and

16 (B) by striking ‘‘$100,000’’ and inserting

17 ‘‘$150,000’’.

18 SEC. 203. LOAN AMOUNTS.

19 Section 7(a)(3)(A) of the Small Business Act (15

20 U.S.C. 636(a)(3)(A)) is amended by striking ‘‘$750,000,’’

21 and inserting, ‘‘$1,000,000 (or if the gross loan amount

22 would exceed $2,000,000),’’.
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1 SEC. 204. INTEREST ON DEFAULTED LOANS.

2 Section 7(a)(4)(B) of the Small Business Act (15

3 U.S.C. 636(a)(4)(B)) is amended by adding at the end

4 the following:

5 ‘‘(iii) APPLICABILITY.—Clauses (i)

6 and (ii) shall not apply to loans made on

7 or after October 1, 2000.’’.

8 SEC. 205. PREPAYMENT OF LOANS.

9 Section 7(a)(4) of the Small Business Act (15 U.S.C.

10 636(a)(4)) is further amended—

11 (1) by striking ‘‘(4) INTEREST RATES AND

12 FEES.—’’ and inserting ‘‘(4) INTEREST RATES AND

13 PREPAYMENT CHARGES.—’’; and

14 (2) by adding at the end the following:

15 ‘‘(C) PREPAYMENT CHARGES.—

16 ‘‘(i) IN GENERAL.—A borrower who

17 prepays any loan guaranteed under this

18 subsection shall remit to the Administra19 tion a subsidy recoupment fee calculated in

20 accordance with clause (ii) if—

21 ‘‘(I) the loan is for a term of not

22 less than 15 years;

23 ‘‘(II) the prepayment is vol24 untary;

25 ‘‘(III) the amount of prepayment

26 in any calendar year is more than 25
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1 percent of the outstanding balance of

2 the loan; and

3 ‘‘(IV) the prepayment is made

4 within the first 3 years after disburse5 ment of the loan proceeds.

6 ‘‘(ii) SUBSIDY RECOUPMENT FEE.—

7 The subsidy recoupment fee charged under

8 clause (i) shall be—

9 ‘‘(I) 5 percent of the amount of

10 prepayment, if the borrower prepays

11 during the first year after disburse12 ment;

13 ‘‘(II) 3 percent of the amount of

14 prepayment, if the borrower prepays

15 during the second year after disburse16 ment; and

17 ‘‘(III) 1 percent of the amount of

18 prepayment, if the borrower prepays

19 during the third year after disburse20 ment.’’.

21 SEC. 206. GUARANTEE FEES.

22 Section 7(a)(18) of the Small Business Act (15

23 U.S.C. 636(a)(18)) is amended to read as follows:

24 ‘‘(18) GUARANTEE FEES.—
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1 ‘‘(A) IN GENERAL.—With respect to each

2 loan guaranteed under this subsection (other

3 than a loan that is repayable in 1 year or less),

4 the Administration shall collect a guarantee fee,

5 which shall be payable by the participating

6 lender, and may be charged to the borrower, as

7 follows:

8 ‘‘(i) A guarantee fee equal to 2 per9 cent of the deferred participation share of

10 a total loan amount that is not more than

11 $150,000.

12 ‘‘(ii) A guarantee fee equal to 3 per13 cent of the deferred participation share of

14 a total loan amount that is more than

15 $150,000, but not more than $700,000.

16 ‘‘(iii) A guarantee fee equal to 3.5

17 percent of the deferred participation share

18 of a total loan amount that is more than

19 $700,000.

20 ‘‘(B) RETENTION OF CERTAIN FEES.—

21 Lenders participating in the programs estab22 lished under this subsection may retain not

23 more than 25 percent of a fee collected under

24 subparagraph (A)(i).’’.
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1 SEC. 207. LEASE TERMS.

2 Section 7(a) of the Small Business Act (15 U.S.C.

3 636(a)) is further amended by adding at the end the fol4 lowing:

5 ‘‘(28) LEASING.—In addition to such other

6 lease arrangements as may be authorized by the Ad7 ministration, a borrower may permanently lease to

8 one or more tenants not more than 20 percent of

9 any property constructed with the proceeds of a loan

10 guaranteed under this subsection, if the borrower

11 permanently occupies and uses not less than 60 per12 cent of the total business space in the property.’’.

13 SEC. 208. APPRAISALS FOR LOANS SECURED BY REAL

14 PROPERTY.

15 (a) SMALL BUSINESS ACT.—Section 7(a) of the

16 Small Business Act (15 U.S.C. 636(a)) is amended by

17 adding at the end the following:

18 ‘‘(29) REAL ESTATE APPRAISALS.—With re19 spect to a loan under this subsection that is secured

20 by commercial real property, an appraisal of such

21 property by a State licensed or certified appraiser—

22 ‘‘(A) shall be required by the Administra23 tion in connection with any such loan for more

24 than $250,000; or

25 ‘‘(B) may be required by the Administra26 tion or the lender in connection with any such
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1 loan for $250,000 or less, if such appraisal is

2 necessary for appropriate evaluation of credit3 worthiness.’’.

4 (b) SMALL BUSINESS INVESTMENT ACT OF 1958.—

5 Section 502(3)(E) of the Small Business Investment Act

6 of 1958 (15 U.S.C. 696(3)(E)) is amended—

7 (1) by striking ‘‘The collateral’’ and inserting

8 the following:

9 ‘‘(i) IN GENERAL.—The collateral’’;

10 and

11 (2) by adding at the end the following:

12 ‘‘(ii) APPRAISALS.—With respect to

13 commercial real property provided by the

14 small business concern as collateral, an ap15 praisal of the property by a State licensed

16 or certified appraiser—

17 ‘‘(I) shall be required by the Ad18 ministration before disbursement of

19 the loan if the estimated value of that

20 property is more than $250,000; or

21 ‘‘(II) may be required by the Ad22 ministration or the lender before dis23 bursement of the loan if the estimated

24 value of that property is $250,000 or

25 less, and such appraisal is necessary
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1 for appropriate evaluation of credit2 worthiness.’’.

3 SEC. 209. SALE OF GUARANTEED LOANS MADE FOR EX4 PORT PURPOSES.

5 Section 5(f)(1)(C) of the Small Business Act (15

6 U.S.C. 634(f)(1)(C)) is amended to read as follows:

7 ‘‘(C) each loan, except each loan made under

8 section 7(a)(14), shall have been fully disbursed to

9 the borrower prior to any sale.’’.

10 SEC. 210. MICROLOAN PROGRAM.

11 (a) IN GENERAL.—Section 7(m) of the Small Busi12 ness Act (15 U.S.C. 636(m)) is amended—

13 (1) in paragraphs (1)(B)(iii) and (3)(E), by

14 striking ‘‘$25,000’’ each place it appears and insert15 ing ‘‘$35,000’’;

16 (2) in paragraphs (1)(A)(iii)(I), (3)(A)(ii), and

17 (4)(C)(i)(II), by striking ‘‘$7,500’’ each place it ap18 pears and inserting ‘‘$10,000’’;

19 (3) in paragraph (3)(E), by striking ‘‘$15,000’’

20 and inserting ‘‘$20,000’’;

21 (4) in paragraph (5)(A)—

22 (A) by striking ‘‘25 grants’’ and inserting

23 ‘‘55 grants’’; and

24 (B) by striking ‘‘$125,000’’ and inserting

25 ‘‘$200,000’’;
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1 (5) in paragraph (6)(B), by striking ‘‘$10,000’’

2 and inserting ‘‘$15,000’’; and

3 (6) in paragraph (7), by striking subparagraph

4 (A) and inserting the following:

5 ‘‘( A) NUMBER OF PARTICIPANTS.—Under

6 the program authorized by this subsection, the

7 Administration may fund, on a competitive

8 basis, not more than 300 intermediaries.’’.

9 (b) CONFORMING AMENDMENTS.—Section

10 7(m)(11)(B) of the Small Business Act (15 U.S.C.

11 636(m)(11)(B)) is amended by striking ‘‘$25,000’’ and in12 serting ‘‘$35,000’’.

13 TITLE III—CERTIFIED DEVELOP14 MENT COMPANY PROGRAM

15 SEC. 301. SHORT TITLE.

16 This title may be cited as the ‘‘Certified Development

17 Company Program Improvements Act of 2000’’.

18 SEC. 302. WOMEN-OWNED BUSINESSES.

19 Section 501(d)(3)(C) of the Small Business Invest20 ment Act of 1958 (15 U.S.C. 695(d)(3)(C)) is amended

21 by inserting before the comma ‘‘or women-owned business

22 development’’.

23 SEC. 303. MAXIMUM DEBENTURE SIZE.

24 Section 502(2) of the Small Business Investment Act

25 of 1958 (15 U.S.C. 696(2)) is amended to read as follows:
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1 ‘‘(2) Loans made by the Administration under

2 this section shall be limited to $1,000,000 for each

3 such identifiable small business concern, except

4 loans meeting the criteria specified in section

5 501(d)(3), which shall be limited to $1,300,000 for

6 each such identifiable small business concern.’’.

7 SEC. 304. FEES.

8 Section 503(f) of the Small Business Investment Act

9 of 1958 (15 U.S.C. 697(f)) is amended to read as follows:

10 ‘‘(f) EFFECTIVE DATE.—The fees authorized by sub11 sections (b) and (d) shall apply to financings approved by

12 the Administration on or after October 1, 1996, but shall

13 not apply to financings approved by the Administration

14 on or after October 1, 2003.’’.

15 SEC. 305. PREMIER CERTIFIED LENDERS PROGRAM.

16 Section 217(b) of the Small Business Administration

17 Reauthorization and Amendments Act of 1994 (Public

18 Law 103–403, 15 U.S.C. 697 note) (relating to section

19 508 of the Small Business Investment Act of 1958) is re20 pealed.

21 SEC. 306. SALE OF CERTAIN DEFAULTED LOANS.

22 Section 508 of the Small Business Investment Act

23 of 1958 (15 U.S.C. 697e) is amended—

24 (1) in subsection (a), by striking ‘‘On a pilot

25 program basis, the’’ and inserting ‘‘The’’;
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1 (2) by redesignating subsections (d) through (i)

2 as subsections (e) through (j), respectively;

3 (3) in subsection (f) (as redesignated by para4 graph (2)), by striking ‘‘subsection (f)’’ and insert5 ing ‘‘subsection (g)’’;

6 (4) in subsection (h) (as redesignated by para7 graph (2)), by striking ‘‘subsection (f)’’ and insert8 ing ‘‘subsection (g)’’; and

9 (5) by inserting after subsection (c) the fol10 lowing:

11 ‘‘(d) SALE OF CERTAIN DEFAULTED LOANS.—

12 ‘‘(1) NOTICE.—If, upon default in repayment,

13 the Administration acquires a loan guaranteed under

14 this section and identifies such loan for inclusion in

15 a bulk asset sale of defaulted or repurchased loans

16 or other financings, it shall give prior notice thereof

17 to any certified development company which has a

18 contingent liability under this section. The notice

19 shall be given to the company as soon as possible

20 after the financing is identified, but not less than 90

21 days before the date the Administration first makes

22 any records on such financing available for examina23 tion by prospective purchasers prior to its offering in

24 a package of loans for bulk sale.
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1 ‘‘(2) LIMITATIONS.—The Administration shall

2 not offer any loan described in paragraph (1) as

3 part of a bulk sale unless it—

4 ‘‘(A) provides prospective purchasers with

5 the opportunity to examine the Administration’s

6 records with respect to such loan; and

7 ‘‘(B) provides the notice required by para8 graph (1).’’.

9 SEC. 307. LOAN LIQUIDATION.

10 (a) LIQUIDATION AND FORECLOSURE.—Title V of

11 the Small Business Investment Act of 1958 (15 U.S.C.

12 695 et seq.) is amended by adding at the end the fol13 lowing:

14 ‘‘SEC. 510. FORECLOSURE AND LIQUIDATION OF LOANS.

15 ‘‘(a) DELEGATION OF AUTHORITY.—In accordance

16 with this section, the Administration shall delegate to any

17 qualified State or local development company (as defined

18 in section 503(e)) that meets the eligibility requirements

19 of subsection (b)(1) the authority to foreclose and liq20 uidate, or to otherwise treat in accordance with this sec21 tion, defaulted loans in its portfolio that are funded with

22 the proceeds of debentures guaranteed by the Administra23 tion under section 503.

24 ‘‘(b) ELIGIBILITY FOR DELEGATION.—
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1 ‘‘(1) REQUIREMENTS.—A qualified State or

2 local development company shall be eligible for a del3 egation of authority under subsection (a) if—

4 ‘‘(A) the company—

5 ‘‘(i) has participated in the loan liq6 uidation pilot program established by the

7 Small Business Programs Improvement

8 Act of 1996 (15 U.S.C. 695 note), as in

9 effect on the day before promulgation of

10 final regulations by the Administration im11 plementing this section;

12 ‘‘(ii) is participating in the Premier

13 Certified Lenders Program under section

14 508; or

15 ‘‘(iii) during the 3 fiscal years imme16 diately prior to seeking such a delegation,

17 has made an average of not less than 10

18 loans per year that are funded with the

19 proceeds of debentures guaranteed under

20 section 503; and

21 ‘‘(B) the company—

22 ‘‘(i) has one or more employees—

23 ‘‘(I) with not less than 2 years of

24 substantive, decision-making experi25 ence in administering the liquidation
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1 and workout of problem loans secured

2 in a manner substantially similar to

3 loans funded with the proceeds of de4 bentures guaranteed under section

5 503; and

6 ‘‘(II) who have completed a train7 ing program on loan liquidation devel8 oped by the Administration in con9 junction with qualified State and local

10 development companies that meet the

11 requirements of this paragraph; or

12 ‘‘(ii) submits to the Administration

13 documentation demonstrating that the

14 company has contracted with a qualified

15 third-party to perform any liquidation ac16 tivities and secures the approval of the

17 contract by the Administration with re18 spect to the qualifications of the contractor

19 and the terms and conditions of liquidation

20 activities.

21 ‘‘(2) CONFIRMATION.—On request the Adminis22 tration shall examine the qualifications of any com23 pany described in subsection (a) to determine if such

24 company is eligible for the delegation of authority

25 under this section. If the Administration determines
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1 that a company is not eligible, the Administration

2 shall provide the company with the reasons for such

3 ineligibility.

4 ‘‘(c) SCOPE OF DELEGATED AUTHORITY.—

5 ‘‘(1) IN GENERAL.—Each qualified State or

6 local development company to which the Administra7 tion delegates authority under section (a) may with

8 respect to any loan described in subsection (a)—

9 ‘‘(A) perform all liquidation and fore10 closure functions, including the purchase in ac11 cordance with this subsection of any other in12 debtedness secured by the property securing the

13 loan, in a reasonable and sound manner accord14 ing to commercially accepted practices, pursu15 ant to a liquidation plan approved in advance

16 by the Administration under paragraph (2)(A);

17 ‘‘(B) litigate any matter relating to the

18 performance of the functions described in sub19 paragraph (A), except that the Administration

20 may—

21 ‘‘(i) defend or bring any claim if—

22 ‘‘(I) the outcome of the litigation

23 may adversely affect the Administra24 tion’s management of the loan pro-
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1 gram established under section 502;

2 or

3 ‘‘(II) the Administration is enti4 tled to legal remedies not available to

5 a qualified State or local development

6 company and such remedies will ben7 efit either the Administration or the

8 qualified State or local development

9 company; or

10 ‘‘(ii) oversee the conduct of any such

11 litigation; and

12 ‘‘(C) take other appropriate actions to

13 mitigate loan losses in lieu of total liquidation

14 or foreclosures, including the restructuring of a

15 loan in accordance with prudent loan servicing

16 practices and pursuant to a workout plan ap17 proved in advance by the Administration under

18 paragraph (2)(C).

19 ‘‘(2) ADMINISTRATION APPROVAL.—

20 ‘‘(A) LIQUIDATION PLAN.—

21 ‘‘(i) IN GENERAL.—Before carrying

22 out functions described in paragraph

23 (1)(A), a qualified State or local develop24 ment company shall submit to the Admin25 istration a proposed liquidation plan.
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1 ‘‘(ii) ADMINISTRATION ACTION ON

2 PLAN.—

3 ‘‘(I) TIMING.—Not later than 15

4 business days after a liquidation plan

5 is received by the Administration

6 under clause (i), the Administration

7 shall approve or reject the plan.

8 ‘‘(II) NOTICE OF NO DECISION.—

9 With respect to any plan that cannot

10 be approved or denied within the 15-

11 day period required by subclause (I),

12 the Administration shall within such

13 period provide in accordance with sub14 paragraph (E) notice to the company

15 that submitted the plan.

16 ‘‘(iii) ROUTINE ACTIONS.—In carrying

17 out functions described in paragraph

18 (1)(A), a qualified State or local develop19 ment company may undertake routine ac20 tions not addressed in a liquidation plan

21 without obtaining additional approval from

22 the Administration.

23 ‘‘(B) PURCHASE OF INDEBTEDNESS.—

24 ‘‘(i) IN GENERAL.—In carrying out

25 functions described in paragraph (1)(A), a
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1 qualified State or local development com2 pany shall submit to the Administration a

3 request for written approval before com4 mitting the Administration to the purchase

5 of any other indebtedness secured by the

6 property securing a defaulted loan.

7 ‘‘(ii) ADMINISTRATION ACTION ON RE8 QUEST.—

9 ‘‘(I) TIMING.—Not later than 15

10 business days after receiving a request

11 under clause (i), the Administration

12 shall approve or deny the request.

13 ‘‘(II) NOTICE OF NO DECISION.—

14 With respect to any request that can15 not be approved or denied within the

16 15-day period required by subclause

17 (I), the Administration shall within

18 such period provide in accordance

19 with subparagraph (E) notice to the

20 company that submitted the request.

21 ‘‘(C) WORKOUT PLAN.—

22 ‘‘(i) IN GENERAL.—In carrying out

23 functions described in paragraph (1)(C), a

24 qualified State or local development com-
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1 pany shall submit to the Administration a

2 proposed workout plan.

3 ‘‘(ii) ADMINISTRATION ACTION ON

4 PLAN.—

5 ‘‘(I) TIMING.—Not later than 15

6 business days after a workout plan is

7 received by the Administration under

8 clause (i), the Administration shall

9 approve or reject the plan.

10 ‘‘(II) NOTICE OF NO DECISION.—

11 With respect to any workout plan that

12 cannot be approved or denied within

13 the 15-day period required by sub14 clause (I), the Administration shall

15 within such period provide in accord16 ance with subparagraph (E) notice to

17 the company that submitted the plan.

18 ‘‘(D) COMPROMISE OF INDEBTEDNESS.—

19 In carrying out functions described in para20 graph (1)(A), a qualified State or local develop21 ment company may—

22 ‘‘(i) consider an offer made by an obli23 gor to compromise the debt for less than

24 the full amount owing; and
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1 ‘‘(ii) pursuant to such an offer, re2 lease any obligor or other party contin3 gently liable, if the company secures the

4 written approval of the Administration.

5 ‘‘(E) CONTENTS OF NOTICE OF NO DECI6 SION.—Any notice provided by the Administra7 tion under subparagraph (A)(ii)(II), (B)(ii)(II),

8 or (C)(ii)(II)—

9 ‘‘(i) shall be in writing;

10 ‘‘(ii) shall state the specific reason for

11 the Administration’s inability to act on a

12 plan or request;

13 ‘‘(iii) shall include an estimate of the

14 additional time required by the Adminis15 tration to act on the plan or request; and

16 ‘‘(iv) if the Administration cannot act

17 because insufficient information or docu18 mentation was provided by the company

19 submitting the plan or request, shall speci20 fy the nature of such additional informa21 tion or documentation.

22 ‘‘(3) CONFLICT OF INTEREST.—In carrying out

23 functions described in paragraph (1), a qualified

24 State or local development company shall take no ac25 tion that would result in an actual or apparent con-
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1 flict of interest between the company (or any em2 ployee of the company) and any third party lender,

3 associate of a third party lender, or any other person

4 participating in a liquidation, foreclosure, or loss

5 mitigation action.

6 ‘‘(d) SUSPENSION OR REVOCATION OF AUTHOR7 ITY.—The Administration may revoke or suspend a dele8 gation of authority under this section to any qualified

9 State or local development company, if the Administration

10 determines that the company—

11 ‘‘(1) does not meet the requirements of sub12 section (b)(1);

13 ‘‘(2) has violated any applicable rule or regula14 tion of the Administration or any other applicable

15 law; or

16 ‘‘(3) fails to comply with any reporting require17 ment that may be established by the Administration

18 relating to carrying out of functions described in

19 paragraph (1).

20 ‘‘(e) REPORT.—

21 ‘‘(1) IN GENERAL.—Based on information pro22 vided by qualified State and local development com23 panies and the Administration, the Administration

24 shall annually submit to the Committees on Small

25 Business of the House of Representatives and of the
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1 Senate a report on the results of delegation of au2 thority under this section.

3 ‘‘(2) CONTENTS.—Each report submitted under

4 paragraph (1) shall include the following informa5 tion:

6 ‘‘(A) With respect to each loan foreclosed

7 or liquidated by a qualified State or local devel8 opment company under this section, or for

9 which losses were otherwise mitigated by the

10 company pursuant to a workout plan under this

11 section—

12 ‘‘(i) the total cost of the project fi13 nanced with the loan;

14 ‘‘(ii) the total original dollar amount

15 guaranteed by the Administration;

16 ‘‘(iii) the total dollar amount of the

17 loan at the time of liquidation, foreclosure,

18 or mitigation of loss;

19 ‘‘(iv) the total dollar losses resulting

20 from the liquidation, foreclosure, or mitiga21 tion of loss; and

22 ‘‘(v) the total recoveries resulting

23 from the liquidation, foreclosure, or mitiga24 tion of loss, both as a percentage of the
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1 amount guaranteed and the total cost of

2 the project financed.

3 ‘‘(B) With respect to each qualified State

4 or local development company to which author5 ity is delegated under this section, the totals of

6 each of the amounts described in clauses (i)

7 through (v) of subparagraph (A).

8 ‘‘(C) With respect to all loans subject to

9 foreclosure, liquidation, or mitigation under this

10 section, the totals of each of the amounts de11 scribed in clauses (i) through (v) of subpara12 graph (A).

13 ‘‘(D) A comparison between—

14 ‘‘(i) the information provided under

15 subparagraph (C) with respect to the 12-

16 month period preceding the date on which

17 the report is submitted; and

18 ‘‘(ii) the same information with re19 spect to loans foreclosed and liquidated, or

20 otherwise treated, by the Administration

21 during the same period.

22 ‘‘(E) The number of times that the Admin23 istration has failed to approve or reject a liq24 uidation plan in accordance with subparagraph

25 (A)(i), a workout plan in accordance with sub-
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1 paragraph (C)(i), or to approve or deny a re2 quest for purchase of indebtedness under sub3 paragraph (B)(i), including specific information

4 regarding the reasons for the Administration’s

5 failure and any delays that resulted.’’.

6 (b) REGULATIONS.—

7 (1) IN GENERAL.—Not later than 150 days

8 after the date of enactment of this Act, the Adminis9 trator shall issue such regulations as may be nec10 essary to carry out section 510 of the Small Busi11 ness Investment Act of 1958, as added by subsection

12 (a) of this section.

13 (2) TERMINATION OF PILOT PROGRAM.—Begin14 ning on the date on which final regulations are

15 issued under paragraph (1), section 204 of the

16 Small Business Programs Improvement Act of 1996

17 (15 U.S.C. 695 note) shall cease to have effect.

18 TITLE IV—CORRECTIONS TO

19 THE SMALL BUSINESS IN20 VESTMENT ACT OF 1958

21 SEC. 401. SHORT TITLE.

22 This title may be cited as the ‘‘Small Business Invest23 ment Corrections Act of 2000’’.
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1 SEC. 402. DEFINITIONS.

2 (a) SMALL BUSINESS CONCERN.—Section

3 103(5)(A)(i) of the Small Business Investment Act of

4 1958 (15 U.S.C. 662(5)(A)(i)) is amended by inserting

5 before the semicolon at the end the following: ‘‘regardless

6 of the allocation of control during the investment period

7 under any investment agreement between the business

8 concern and the entity making the investment’’.

9 (b) LONG TERM.—Section 103 of the Small Business

10 Investment Act of 1958 (15 U.S.C. 662) is amended—

11 (1) in paragraph (15), by striking ‘‘and’’ at the

12 end;

13 (2) in paragraph (16), by striking the period at

14 the end and inserting ‘‘; and’’; and

15 (3) by adding at the end the following:

16 ‘‘(17) the term ‘long term’, when used in con17 nection with equity capital or loan funds invested in

18 any small business concern or smaller enterprise,

19 means any period of time not less than 1 year.’’.

20 SEC. 403. INVESTMENT IN SMALL BUSINESS INVESTMENT

21 COMPANIES.

22 Section 302(b) of the Small Business Investment Act

23 of 1958 (15 U.S.C. 682(b)) is amended—

24 (1) by striking ‘‘(b) Notwithstanding’’ and in25 serting the following:

26 ‘‘(b) FINANCIAL INSTITUTION INVESTMENTS.—
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1 ‘‘(1) CERTAIN BANKS.—Notwithstanding’’; and

2 (2) by adding at the end the following:

3 ‘‘(2) CERTAIN SAVINGS ASSOCIATIONS.—Not4 withstanding any other provision of law, any Federal

5 savings association may invest in any 1 or more

6 small business investment companies, or in any enti7 ty established to invest solely in small business in8 vestment companies, except that in no event may the

9 total amount of such investments by any such Fed10 eral savings association exceed 5 percent of the cap11 ital and surplus of the Federal savings association.’’.

12 SEC. 404. SUBSIDY FEES.

13 (a) DEBENTURES.—Section 303(b) of the Small

14 Business Investment Act of 1958 (15 U.S.C. 683(b)) is

15 amended by striking ‘‘plus an additional charge of 1 per16 cent per annum which shall be paid to and retained by

17 the Administration’’ and inserting ‘‘plus, for debentures

18 obligated after September 30, 2000, an additional charge,

19 in an amount established annually by the Administration,

20 of not more than 1 percent per year as necessary to reduce

21 to zero the cost (as defined in section 502 of the Federal

22 Credit Reform Act of 1990 (2 U.S.C. 661a)) to the Ad23 ministration of purchasing and guaranteeing debentures

24 under this Act, which shall be paid to and retained by

25 the Administration’’.
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1 (b) PARTICIPATING SECURITIES.—Section 303(g)(2)

2 of the Small Business Investment Act of 1958 (15 U.S.C.

3 683(g)(2)) is amended by striking ‘‘plus an additional

4 charge of 1 percent per annum which shall be paid to and

5 retained by the Administration’’ and inserting ‘‘plus, for

6 participating securities obligated after September 30,

7 2000, an additional charge, in an amount established an8 nually by the Administration, of not more than 1 percent

9 per year as necessary to reduce to zero the cost (as defined

10 in section 502 of the Federal Credit Reform Act of 1990

11 (2 U.S.C. 661a)) to the Administration of purchasing and

12 guaranteeing participating securities under this Act, which

13 shall be paid to and retained by the Administration’’.

14 SEC. 405. DISTRIBUTIONS.

15 Section 303(g)(8) of the Small Business Investment

16 Act of 1958 (15 U.S.C. 683(g)(8)) is amended—

17 (1) by striking ‘‘subchapter s corporation’’ and

18 inserting ‘‘subchapter S corporation’’;

19 (2) by striking ‘‘the end of any calendar quarter

20 based on a quarterly’’ and inserting ‘‘any time dur21 ing any calendar quarter based on an’’; and

22 (3) by striking ‘‘quarterly distributions for a

23 calendar year,’’ and inserting ‘‘interim distributions

24 for a calendar year,’’.
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1 SEC. 406. CONFORMING AMENDMENT.

2 Section 310(c)(4) of the Small Business Investment

3 Act of 1958 (15 U.S.C. 687b(c)(4)) is amended by strik4 ing ‘‘five years’’ and inserting ‘‘1 year’’.

5 TITLE V—REAUTHORIZATION OF

6 SMALL BUSINESS PROGRAMS

7 SEC. 501. SHORT TITLE.

8 This title may be cited as the ‘‘Small Business Pro9 grams Reauthorization Act of 2000’’.

10 SEC. 502. REAUTHORIZATION OF SMALL BUSINESS PRO11 GRAMS.

12 Section 20 of the Small Business Act (15 U.S.C. 631

13 note) is amended by adding at the end the following:

14 ‘‘(g) FISCAL YEAR 2001.—

15 ‘‘(1) PROGRAM LEVELS.—The following pro16 gram levels are authorized for fiscal year 2001:

17 ‘‘(A) For the programs authorized by this

18 Act, the Administration is authorized to

19 make—

20 ‘‘(i) $45,000,000 in technical assist21 ance grants as provided in section 7(m);

22 and

23 ‘‘(ii) $60,000,000 in direct loans, as

24 provided in 7(m).

25 ‘‘(B) For the programs authorized by this

26 Act, the Administration is authorized to make
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•HR 5654 IH

1 $19,050,000,000 in deferred participation loans

2 and other financings. Of such sum, the Admin3 istration is authorized to make—

4 ‘‘(i) $14,500,000,000 in general busi5 ness loans as provided in section 7(a);

6 ‘‘(ii) $4,000,000,000 in financings as

7 provided in section 7(a)(13) of this Act

8 and section 504 of the Small Business In9 vestment Act of 1958;

10 ‘‘(iii) $500,000,000 in loans as pro11 vided in section 7(a)(21); and

12 ‘‘(iv) $50,000,000 in loans as pro13 vided in section 7(m).

14 ‘‘(C) For the programs authorized by title

15 III of the Small Business Investment Act of

16 1958, the Administration is authorized to

17 make—

18 ‘‘(i) $2,500,000,000 in purchases of

19 participating securities; and

20 ‘‘(ii) $1,500,000,000 in guarantees of

21 debentures.

22 ‘‘(D) For the programs authorized by part

23 B of title IV of the Small Business Investment

24 Act of 1958, the Administration is authorized

25 to enter into guarantees not to exceed
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1 $4,000,000,000 of which not more than 50 per2 cent may be in bonds approved pursuant to sec3 tion 411(a)(3) of that Act.

4 ‘‘(E) The Administration is authorized to

5 make grants or enter cooperative agreements

6 for a total amount of $5,000,000 for the Serv7 ice Corps of Retired Executives program au8 thorized by section 8(b)(1).

9 ‘‘(2) ADDITIONAL AUTHORIZATIONS.—

10 ‘‘(A) There are authorized to be appro11 priated to the Administration for fiscal year

12 2001 such sums as may be necessary to carry

13 out the provisions of this Act not elsewhere pro14 vided for, including administrative expenses and

15 necessary loan capital for disaster loans pursu16 ant to section 7(b), and to carry out title IV of

17 the Small Business Investment Act of 1958, in18 cluding salaries and expenses of the Adminis19 tration.

20 ‘‘(B) Notwithstanding any other provision

21 of this paragraph, for fiscal year 2001—

22 ‘‘(i) no funds are authorized to be

23 used as loan capital for the loan program

24 authorized by section 7(a)(21) except by

25 transfer from another Federal department
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1 or agency to the Administration, unless the

2 program level authorized for general busi3 ness loans under paragraph (1)(B)(i) is

4 fully funded; and

5 ‘‘(ii) the Administration may not ap6 prove loans on its own behalf or on behalf

7 of any other Federal department or agen8 cy, by contract or otherwise, under terms

9 and conditions other than those specifically

10 authorized under this Act or the Small

11 Business Investment Act of 1958, except

12 that it may approve loans under section

13 7(a)(21) of this Act in gross amounts of

14 not more than $1,250,000.

15 ‘‘(h) FISCAL YEAR 2002.—

16 ‘‘(1) PROGRAM LEVELS.—The following pro17 gram levels are authorized for fiscal year 2002:

18 ‘‘(A) For the programs authorized by this

19 Act, the Administration is authorized to

20 make—

21 ‘‘(i) $60,000,000 in technical assist22 ance grants as provided in section 7(m);

23 and

24 ‘‘(ii) $80,000,000 in direct loans, as

25 provided in 7(m).
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1 ‘‘(B) For the programs authorized by this

2 Act, the Administration is authorized to make

3 $20,050,000,000 in deferred participation loans

4 and other financings. Of such sum, the Admin5 istration is authorized to make—

6 ‘‘(i) $15,000,000,000 in general busi7 ness loans as provided in section 7(a);

8 ‘‘(ii) $4,500,000,000 in financings as

9 provided in section 7(a)(13) of this Act

10 and section 504 of the Small Business In11 vestment Act of 1958;

12 ‘‘(iii) $500,000,000 in loans as pro13 vided in section 7(a)(21); and

14 ‘‘(iv) $50,000,000 in loans as pro15 vided in section 7(m).

16 ‘‘(C) For the programs authorized by title

17 III of the Small Business Investment Act of

18 1958, the Administration is authorized to

19 make—

20 ‘‘(i) $3,500,000,000 in purchases of

21 participating securities; and

22 ‘‘(ii) $2,500,000,000 in guarantees of

23 debentures.

24 ‘‘(D) For the programs authorized by part

25 B of title IV of the Small Business Investment
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1 Act of 1958, the Administration is authorized

2 to enter into guarantees not to exceed

3 $5,000,000,000 of which not more than 50 per4 cent may be in bonds approved pursuant to sec5 tion 411(a)(3) of that Act.

6 ‘‘(E) The Administration is authorized to

7 make grants or enter cooperative agreements

8 for a total amount of $6,000,000 for the Serv9 ice Corps of Retired Executives program au10 thorized by section 8(b)(1).

11 ‘‘(2) ADDITIONAL AUTHORIZATIONS.—

12 ‘‘(A) There are authorized to be appro13 priated to the Administration for fiscal year

14 2002 such sums as may be necessary to carry

15 out the provisions of this Act not elsewhere pro16 vided for, including administrative expenses and

17 necessary loan capital for disaster loans pursu18 ant to section 7(b), and to carry out title IV of

19 the Small Business Investment Act of 1958, in20 cluding salaries and expenses of the Adminis21 tration.

22 ‘‘(B) Notwithstanding any other provision

23 of this paragraph, for fiscal year 2002—

24 ‘‘(i) no funds are authorized to be

25 used as loan capital for the loan program
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1 authorized by section 7(a)(21) except by

2 transfer from another Federal department

3 or agency to the Administration, unless the

4 program level authorized for general busi5 ness loans under paragraph (1)(B)(i) is

6 fully funded; and

7 ‘‘(ii) the Administration may not ap8 prove loans on its own behalf or on behalf

9 of any other Federal department or agen10 cy, by contract or otherwise, under terms

11 and conditions other than those specifically

12 authorized under this Act or the Small

13 Business Investment Act of 1958, except

14 that it may approve loans under section

15 7(a)(21) of this Act in gross amounts of

16 not more than $1,250,000.

17 ‘‘(i) FISCAL YEAR 2003.—

18 ‘‘(1) PROGRAM LEVELS.—The following pro19 gram levels are authorized for fiscal year 2003:

20 ‘‘(A) For the programs authorized by this

21 Act, the Administration is authorized to

22 make—

23 ‘‘(i) $70,000,000 in technical assist24 ance grants as provided in section 7(m);

25 and
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1 ‘‘(ii) $100,000,000 in direct loans, as

2 provided in 7(m).

3 ‘‘(B) For the programs authorized by this

4 Act, the Administration is authorized to make

5 $21,550,000,000 in deferred participation loans

6 and other financings. Of such sum, the Admin7 istration is authorized to make—

8 ‘‘(i) $16,000,000,000 in general busi9 ness loans as provided in section 7(a);

10 ‘‘(ii) $5,000,000,000 in financings as

11 provided in section 7(a)(13) of this Act

12 and section 504 of the Small Business In13 vestment Act of 1958;

14 ‘‘(iii) $500,000,000 in loans as pro15 vided in section 7(a)(21); and

16 ‘‘(iv) $50,000,000 in loans as pro17 vided in section 7(m).

18 ‘‘(C) For the programs authorized by title

19 III of the Small Business Investment Act of

20 1958, the Administration is authorized to

21 make—

22 ‘‘(i) $4,000,000,000 in purchases of

23 participating securities; and

24 ‘‘(ii) $3,000,000,000 in guarantees of

25 debentures.
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1 ‘‘(D) For the programs authorized by part

2 B of title IV of the Small Business Investment

3 Act of 1958, the Administration is authorized

4 to enter into guarantees not to exceed

5 $6,000,000,000 of which not more than 50 per6 cent may be in bonds approved pursuant to sec7 tion 411(a)(3) of that Act.

8 ‘‘(E) The Administration is authorized to

9 make grants or enter into cooperative agree10 ments for a total amount of $7,000,000 for the

11 Service Corps of Retired Executives program

12 authorized by section 8(b)(1).

13 ‘‘(2) ADDITIONAL AUTHORIZATIONS.—

14 ‘‘(A) There are authorized to be appro15 priated to the Administration for fiscal year

16 2003 such sums as may be necessary to carry

17 out the provisions of this Act not elsewhere pro18 vided for, including administrative expenses and

19 necessary loan capital for disaster loans pursu20 ant to section 7(b), and to carry out title IV of

21 the Small Business Investment Act of 1958, in22 cluding salaries and expenses of the Adminis23 tration.

24 ‘‘(B) Notwithstanding any other provision

25 of this paragraph, for fiscal year 2003—
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1 ‘‘(i) no funds are authorized to be

2 used as loan capital for the loan program

3 authorized by section 7(a)(21) except by

4 transfer from another Federal department

5 or agency to the Administration, unless the

6 program level authorized for general busi7 ness loans under paragraph (1)(B)(i) is

8 fully funded; and

9 ‘‘(ii) the Administration may not ap10 prove loans on its own behalf or on behalf

11 of any other Federal department or agen12 cy, by contract or otherwise, under terms

13 and conditions other than those specifically

14 authorized under this Act or the Small

15 Business Investment Act of 1958, except

16 that it may approve loans under section

17 7(a)(21) of this Act in gross amounts of

18 not more than $1,250,000.’’.

19 SEC. 503. ADDITIONAL REAUTHORIZATIONS.

20 (a) DRUG-FREE WORKPLACE PROGRAM.—Section 27

21 of the Small Business Act (15 U.S.C. 654) is amended—

22 (1) in the section heading, by striking ‘‘DRUG23 FREE WORKPLACE DEMONSTRATION PRO24 GRAM’’ and inserting ‘‘PAUL D. COVERDELL

25 DRUG-FREE WORKPLACE PROGRAM’’; and
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1 (2) in subsection (g)(1), by striking

2 ‘‘$10,000,000 for fiscal years 1999 and 2000’’ and

3 inserting ‘‘$5,000,000 for each of fiscal years 2001

4 through 2003’’.

5 (b) HUBZONE PROGRAM.—Section 31 of the Small

6 Business Act (15 U.S.C. 657a) is amended by adding at

7 the end the following:

8 ‘‘(d) AUTHORIZATION OF APPROPRIATIONS.—There

9 is authorized to be appropriated to carry out the program

10 established by this section $10,000,000 for each of fiscal

11 years 2001 through 2003.’’.

12 (c) VERY SMALL BUSINESS CONCERNS PROGRAM.—

13 Section 304(i) of the Small Business Administration Re14 authorization and Amendments Act of 1994 (Public Law

15 103–403; 15 U.S.C. 644 note) is amended by striking

16 ‘‘September 30, 2000’’ and inserting ‘‘September 30,

17 2003’’.

18 (d) SOCIALLY AND ECONOMICALLY DISADVANTAGED

19 BUSINESSES PROGRAM.—Section 7102(c) of the Federal

20 Acquisition Streamlining Act of 1994 (Public Law 103–

21 355; 15 U.S.C. 644 note) is amended by striking ‘‘Sep22 tember 30, 2000’’ and inserting ‘‘September 30, 2003’’.

23 (e) SBDC SERVICES.—Section 21(c)(3)(T) of the

24 Small Business Act (15 U.S.C. 648(c)(3)(T)) is amended

25 by striking ‘‘2000’’ and inserting ‘‘2003’’.
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1 SEC. 504. COSPONSORSHIP.

2 (a) IN GENERAL.—Section 8(b)(1)(A) of the Small

3 Business Act (15 U.S.C. 637(b)(1)(A)) is amended to read

4 as follows:

5 ‘‘(1)(A) to provide—

6 ‘‘(i) technical, managerial, and informa7 tional aids to small business concerns—

8 ‘‘(I) by advising and counseling on

9 matters in connection with Government

10 procurement and policies, principles, and

11 practices of good management;

12 ‘‘(II) by cooperating and advising

13 with—

14 ‘‘(aa) voluntary business, profes15 sional, educational, and other non16 profit organizations, associations, and

17 institutions (except that the Adminis18 tration shall take such actions as it

19 determines necessary to ensure that

20 such cooperation does not constitute

21 or imply an endorsement by the Ad22 ministration of the organization or its

23 products or services, and shall ensure

24 that it receives appropriate recogni25 tion in all printed materials); and
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1 ‘‘(bb) other Federal and State

2 agencies;

3 ‘‘(III) by maintaining a clearinghouse

4 for information on managing, financing,

5 and operating small business enterprises;

6 and

7 ‘‘(IV) by disseminating such informa8 tion, including through recognition events,

9 and by other activities that the Adminis10 tration determines to be appropriate; and

11 ‘‘(ii) through cooperation with a profit12 making concern (referred to in this paragraph

13 as a ‘cosponsor’), training, information, and

14 education to small business concerns, except

15 that the Administration shall—

16 ‘‘(I) take such actions as it deter17 mines to be appropriate to ensure that—

18 ‘‘(aa) the Administration receives

19 appropriate recognition and publicity;

20 ‘‘(bb) the cooperation does not

21 constitute or imply an endorsement by

22 the Administration of any product or

23 service of the cosponsor;
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1 ‘‘(cc) unnecessary promotion of

2 the products or services of the cospon3 sor is avoided; and

4 ‘‘(dd) utilization of any 1 cospon5 sor in a marketing area is minimized;

6 and

7 ‘‘(II) develop an agreement, executed

8 on behalf of the Administration by an em9 ployee of the Administration in Wash10 ington, the District of Columbia, that pro11 vides, at a minimum, that—

12 ‘‘(aa) any printed material to an13 nounce the cosponsorship or to be dis14 tributed at the cosponsored activity,

15 shall be approved in advance by the

16 Administration;

17 ‘‘(bb) the terms and conditions of

18 the cooperation shall be specified;

19 ‘‘(cc) only minimal charges may

20 be imposed on any small business con21 cern to cover the direct costs of pro22 viding the assistance;

23 ‘‘(dd) the Administration may

24 provide to the cosponsorship mailing

25 labels, but not lists of names and ad-
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1 dresses of small business concerns

2 compiled by the Administration;

3 ‘‘(ee) all printed materials con4 taining the names of both the Admin5 istration and the cosponsor shall in6 clude a prominent disclaimer that the

7 cooperation does not constitute or

8 imply an endorsement by the Adminis9 tration of any product or service of

10 the cosponsor; and

11 ‘‘(ff) the Administration shall en12 sure that it receives appropriate rec13 ognition in all cosponsorship printed

14 materials.’’.

15 (b) EXTENSION OF COSPONSORSHIP AUTHORITY.—

16 Section 401(a)(2) of the Small Business Administration

17 Reauthorization and Amendments Act of 1994 (15 U.S.C.

18 637 note) is amended by striking ‘‘September 30, 2000’’

19 and inserting ‘‘September 30, 2003’’.

20 TITLE VI—HUBZONE PROGRAM

21 Subtitle A—HUBZones in Native

22 America

23 SEC. 601. SHORT TITLE.

24 This subtitle may be cited as the ‘‘HUBZones in Na25 tive America Act of 2000’’.
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1 SEC. 602. HUBZONE SMALL BUSINESS CONCERN.

2 Section 3(p)(3) of the Small Business Act (15 U.S.C.

3 632(p)(3)) is amended to read as follows:

4 ‘‘(3) HUBZONE SMALL BUSINESS CONCERN.—

5 The term ‘HUBZone small business concern’

6 means—

7 ‘‘(A) a small business concern that is

8 owned and controlled by 1 or more persons,

9 each of whom is a United States citizen;

10 ‘‘(B) a small business concern that is—

11 ‘‘(i) an Alaska Native Corporation

12 owned and controlled by Natives (as deter13 mined pursuant to section 29(e)(1) of the

14 Alaska Native Claims Settlement Act (43

15 U.S.C. 1626(e)(1))); or

16 ‘‘(ii) a direct or indirect subsidiary

17 corporation, joint venture, or partnership

18 of an Alaska Native Corporation qualifying

19 pursuant to section 29(e)(1) of the Alaska

20 Native Claims Settlement Act (43 U.S.C.

21 1626(e)(1)), if that subsidiary, joint ven22 ture, or partnership is owned and con23 trolled by Natives (as determined pursuant

24 to section 29(e)(2)) of the Alaska Native

25 Claims Settlement Act (43 U.S.C.

26 1626(e)(2))); or
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1 ‘‘(C) a small business concern—

2 ‘‘(i) that is wholly owned by 1 or more

3 Indian tribal governments, or by a corpora4 tion that is wholly owned by 1 or more In5 dian tribal governments; or

6 ‘‘(ii) that is owned in part by 1 or

7 more Indian tribal governments, or by a

8 corporation that is wholly owned by 1 or

9 more Indian tribal governments, if all

10 other owners are either United States citi11 zens or small business concerns.’’.

12 SEC. 603. QUALIFIED HUBZONE SMALL BUSINESS CON13 CERN.

14 (a) IN GENERAL.—Section 3(p)(5)(A)(i) of the Small

15 Business Act (15 U.S.C. 632(p)(5)(A)(i)) is amended by

16 striking subclauses (I) and (II) and inserting the fol17 lowing:

18 ‘‘(I) it is a HUBZone small busi19 ness concern—

20 ‘‘(aa) pursuant to subpara21 graph (A) or (B) of paragraph

22 (3), and that its principal office

23 is located in a HUBZone and not

24 fewer than 35 percent of its em25 ployees reside in a HUBZone; or
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1 ‘‘(bb) pursuant to paragraph

2 (3)(C), and not fewer than 35

3 percent of its employees engaged

4 in performing a contract awarded

5 to the small business concern on

6 the basis of a preference provided

7 under section 31(b) reside within

8 any Indian reservation governed

9 by 1 or more of the tribal govern10 ment owners, or reside within

11 any HUBZone adjoining any

12 such Indian reservation;

13 ‘‘(II) the small business concern

14 will attempt to maintain the applica15 ble employment percentage under sub16 clause (I) during the performance of

17 any contract awarded to the small

18 business concern on the basis of a

19 preference provided under section

20 31(b); and’’.

21 (b) CLARIFYING AMENDMENT.—Section

22 3(p)(5)(D)(i) of the Small Business Act (15 U.S.C.

23 632(p)(5)(D)(i)) is amended by inserting ‘‘once the Ad24 ministrator has made the certification required by sub25 paragraph (A)(i) regarding a qualified HUBZone small
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1 business concern and has determined that subparagraph

2 (A)(ii) does not apply to that concern,’’ before ‘‘include’’.

3 SEC. 604. OTHER DEFINITIONS.

4 Section 3(p) of the Small Business Act (15 U.S.C.

5 632(p)) is amended by adding at the end the following:

6 ‘‘(6) NATIVE AMERICAN SMALL BUSINESS CON7 CERNS.—

8 ‘‘(A) ALASKA NATIVE CORPORATION.—The

9 term ‘Alaska Native Corporation’ has the same

10 meaning as the term ‘Native Corporation’ in

11 section 3 of the Alaska Native Claims Settle12 ment Act (43 U.S.C. 1602).

13 ‘‘(B) ALASKA NATIVE VILLAGE.—The term

14 ‘Alaska Native Village’ has the same meaning

15 as the term ‘Native village’ in section 3 of the

16 Alaska Native Claims Settlement Act (43

17 U.S.C. 1602).

18 ‘‘(C) INDIAN RESERVATION.—The term

19 ‘Indian reservation’—

20 ‘‘(i) has the same meaning as the

21 term ‘Indian country’ in section 1151 of

22 title 18, United States Code, except that

23 such term does not include—

24 ‘‘(I) any lands that are located

25 within a State in which a tribe did not
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1 exercise governmental jurisdiction on

2 the date of enactment of the Small

3 Business Reauthorization Act of

4 2000, unless that tribe is recognized

5 after that date of enactment by either

6 an Act of Congress or pursuant to

7 regulations of the Secretary of the In8 terior for the administrative recogni9 tion that an Indian group exists as an

10 Indian tribe (part 83 of title 25, Code

11 of Federal Regulations); and

12 ‘‘(II) lands taken into trust or

13 acquired by an Indian tribe after the

14 date of enactment of the Small Busi15 ness Reauthorization Act of 2000 if

16 such lands are not located within the

17 external boundaries of an Indian res18 ervation or former reservation or are

19 not contiguous to the lands held in

20 trust or restricted status on that date

21 of enactment; and

22 ‘‘(ii) in the State of Oklahoma, means

23 lands that—

24 ‘‘(I) are within the jurisdictional

25 areas of an Oklahoma Indian tribe (as
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1 determined by the Secretary of the In2 terior); and

3 ‘‘(II) are recognized by the Sec4 retary of the Interior as eligible for

5 trust land status under part 151 of

6 title 25, Code of Federal Regulations

7 (as in effect on the date of enactment

8 of the Small Business Reauthorization

9 Act of 2000).’’.

10 Subtitle B—Other HUBZone

11 Provisions

12 SEC. 611. DEFINITIONS.

13 (a) QUALIFIED CENSUS TRACT.—Section 3(p)(4)(A)

14 of the Small Business Act (15 U.S.C. 632(p)(4)(A)) is

15 amended by striking ‘‘(I)’’.

16 (b) QUALIFIED NONMETROPOLITAN COUNTY.—Sec17 tion 3(p)(4) of the Small Business Act (15 U.S.C.

18 632(p)(4)) is amended by striking subparagraph (B) and

19 inserting the following:

20 ‘‘(B) QUALIFIED NONMETROPOLITAN

21 COUNTY.—The term ‘qualified nonmetropolitan

22 county’ means any county—

23 ‘‘(i) that was not located in a metro24 politan statistical area (as defined in sec25 tion 143(k)(2)(B) of the Internal Revenue
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1 Code of 1986) at the time of the most re2 cent census taken for purposes of selecting

3 qualified census tracts under section

4 42(d)(5)(C)(ii) of the Internal Revenue

5 Code of 1986; and

6 ‘‘(ii) in which—

7 ‘‘(I) the median household in8 come is less than 80 percent of the

9 nonmetropolitan State median house10 hold income, based on the most recent

11 data available from the Bureau of the

12 Census of the Department of Com13 merce; or

14 ‘‘(II) the unemployment rate is

15 not less than 140 percent of the

16 Statewide average unemployment rate

17 for the State in which the county is

18 located, based on the most recent data

19 available from the Secretary of

20 Labor.’’.

21 SEC. 612. ELIGIBLE CONTRACTS.

22 (a) COMMODITIES CONTRACTS.—Section 31(b)(3) of

23 the Small Business Act (15 U.S.C. 657a(b)(3)) is

24 amended—
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1 (1) by striking ‘‘In any’’ and inserting the fol2 lowing:

3 ‘‘(A) IN GENERAL.—Subject to subpara4 graph (B), in any’’; and

5 (2) by adding at the end the following:

6 ‘‘(B) PROCUREMENT OF COMMODITIES.—

7 For purchases by the Secretary of Agriculture

8 of agricultural commodities, the price evaluation

9 preference shall be—

10 ‘‘(i) 10 percent, for the portion of a

11 contract to be awarded that is not greater

12 than 25 percent of the total volume being

13 procured for each commodity in a single

14 invitation;

15 ‘‘(ii) 5 percent, for the portion of a

16 contract to be awarded that is greater than

17 25 percent, but not greater than 40 per18 cent, of the total volume being procured

19 for each commodity in a single invitation;

20 and

21 ‘‘(iii) zero, for the portion of a con22 tract to be awarded that is greater than 40

23 percent of the total volume being procured

24 for each commodity in a single invitation.
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1 ‘‘(C) TREATMENT OF PREFERENCE.—A

2 contract awarded to a HUBZone small business

3 concern under a preference described in sub4 paragraph (B) shall not be counted toward the

5 fulfillment of any requirement partially set

6 aside for competition restricted to small busi7 ness concerns.’’.

8 (b) DEFINITIONS.—Section 3(p) of the Small Busi9 ness Act (15 U.S.C. 632(p)), as amended by this Act, is

10 amended—

11 (1) in paragraph (5)(A)(i)(III)—

12 (A) in item (aa), by striking ‘‘and’’ at the

13 end; and

14 (B) by adding at the end the following:

15 ‘‘(cc) in the case of a con16 tract for the procurement by the

17 Secretary of Agriculture of agri18 cultural commodities, none of the

19 commodity being procured will be

20 obtained by the prime contractor

21 through a subcontract for the

22 purchase of the commodity in

23 substantially the final form in

24 which it is to be supplied to the

25 Government; and’’; and
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1 (2) by adding at the end the following:

2 ‘‘(7) AGRICULTURAL COMMODITY.—The term

3 ‘agricultural commodity’ has the same meaning as in

4 section 102 of the Agricultural Trade Act of 1978

5 (7 U.S.C. 5602).’’.

6 SEC. 613. HUBZONE REDESIGNATED AREAS.

7 Section 3(p) of the Small Business Act (15 U.S.C.

8 632(p)) is amended—

9 (1) in paragraph (1)—

10 (A) in subparagraph (B), by striking ‘‘or’’

11 at the end;

12 (B) in subparagraph (C), by striking the

13 period at the end and inserting ‘‘; or’’; and

14 (C) by adding at the end the following:

15 ‘‘(D) redesignated areas.’’; and

16 (2) in paragraph (4), by adding at the end the

17 following:

18 ‘‘(C) REDESIGNATED AREA.—The term

19 ‘redesignated area’ means any census tract that

20 ceases to be qualified under subparagraph (A)

21 and any nonmetropolitan county that ceases to

22 be qualified under subparagraph (B), except

23 that a census tract or a nonmetropolitan county

24 may be a ‘redesignated area’ only for the 3-year

25 period following the date on which the census
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1 tract or nonmetropolitan county ceased to be so

2 qualified.’’.

3 SEC. 614. COMMUNITY DEVELOPMENT.

4 Section 3(p) of the Small Business Act (15 U.S.C.

5 632(p)), as amended by this Act, is amended—

6 (1) in paragraph (3)—

7 (A) in subparagraph (B), by striking ‘‘or’’

8 at the end;

9 (B) in subparagraph (C), by striking the

10 period at the end and inserting ‘‘; or’’; and

11 (C) by adding at the end the following:

12 ‘‘(D) a small business concern that is—

13 ‘‘(i) wholly owned by a community de14 velopment corporation that has received fi15 nancial assistance under Part 1 of Sub16 chapter A of the Community Economic De17 velopment Act of 1981 (42 U.S.C. 9805 et

18 seq.); or

19 ‘‘(ii) owned in part by 1 or more com20 munity development corporations, if all

21 other owners are either United States citi22 zens or small business concerns.’’; and

23 (2) in paragraph (5)(A)(i)(I)(aa), by striking

24 ‘‘subparagraph (A) or (B)’’ and inserting ‘‘subpara25 graph (A), (B), or (D)’’.
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1 SEC. 615. REFERENCE CORRECTIONS.

2 (a) SECTION 3.—Section 3(p)(5)(C) of the Small

3 Business Act (15 U.S.C. 632(p)(5)(C)) is amended by

4 striking ‘‘subclause (IV) and (V) of subparagraph (A)(i)’’

5 and inserting ‘‘items (aa) and (bb) of subparagraph

6 (A)(i)(III)’’.

7 (b) SECTION 8.—Section 8(d)(4)(D) of the Small

8 Business Act (15 U.S.C. 637(d)(4)(D)) is amended by in9 serting ‘‘qualified HUBZone small business concerns,’’

10 after ‘‘small business concerns,’’.

11 TITLE VII—NATIONAL WOMEN’S

12 BUSINESS COUNCIL REAU13 THORIZATION

14 SEC. 701. SHORT TITLE.

15 This title may be cited as the ‘‘National Women’s

16 Business Council Reauthorization Act of 2000’’.

17 SEC. 702. MEMBERSHIP OF THE COUNCIL.

18 Section 407 of the Women’s Business Ownership Act

19 of 1988 (15 U.S.C. 631 note) is amended—

20 (1) in subsection (a), by striking ‘‘Not later’’

21 and all that follows through ‘‘the President’’ and in22 serting ‘‘The President’’;

23 (2) in subsection (b)—

24 (A) by striking ‘‘Not later’’ and all that

25 follows through ‘‘the Administrator’’ and insert26 ing ‘‘The Administrator’’; and
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1 (B) by striking ‘‘the Assistant Adminis2 trator of the Office of Women’s Business Own3 ership and’’;

4 (3) in subsection (d), by striking ‘‘, except

5 that’’ and all that follows through the end of the

6 subsection and inserting a period; and

7 (4) in subsection (h), by striking ‘‘Not later’’

8 and all that follows through ‘‘the Administrator’’

9 and inserting ‘‘The Administrator’’.

10 SEC. 703. REPEAL OF PROCUREMENT PROJECT.

11 Section 409 of the Women’s Business Ownership Act

12 of 1988 (15 U.S.C. 631 note) is repealed.

13 SEC. 704. STUDIES AND OTHER RESEARCH.

14 Section 410 of the Women’s Business Ownership Act

15 of 1988 (15 U.S.C. 631 note) is amended to read as fol16 lows:

17 ‘‘SEC. 409. STUDIES AND OTHER RESEARCH.

18 ‘‘(a) IN GENERAL.—The Council may conduct such

19 studies and other research relating to the award of Fed20 eral prime contracts and subcontracts to women-owned

21 businesses, to access to credit and investment capital by

22 women entrepreneurs, or to other issues relating to

23 women-owned businesses, as the Council determines to be

24 appropriate.
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1 ‘‘(b) CONTRACT AUTHORITY.—In conducting any

2 study or other research under this section, the Council

3 may contract with 1 or more public or private entities.’’.

4 SEC. 705. AUTHORIZATION OF APPROPRIATIONS.

5 Section 411 of the Women’s Business Ownership Act

6 of 1988 (15 U.S.C. 631 note) is amended to read as fol7 lows:

8 ‘‘SEC. 410. AUTHORIZATION OF APPROPRIATIONS.

9 ‘‘(a) IN GENERAL.—There is authorized to be appro10 priated to carry out this title $1,000,000, for each of fiscal

11 years 2001 through 2003, of which $550,000 shall be

12 available in each such fiscal year to carry out section 409.

13 ‘‘(b) BUDGET REVIEW.—No amount made available

14 under this section for any fiscal year may be obligated or

15 expended by the Council before the date on which the

16 Council reviews and approves the operating budget of the

17 Council to carry out the responsibilities of the Council for

18 that fiscal year.’’.

19 TITLE VIII—MISCELLANEOUS

20 PROVISIONS

21 SEC. 801. LOAN APPLICATION PROCESSING.

22 (a) STUDY.—The Administrator of the Small Busi23 ness Administration shall conduct a study to determine

24 the average time that the Administration requires to proc25 ess an application for each type of loan or loan guarantee
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1 made under the Small Business Act (15 U.S.C. 631 et

2 seq.).

3 (b) TRANSMITTAL.—Not later than 1 year after the

4 date of enactment of this Act, the Administrator shall

5 transmit to Congress the results of the study conducted

6 under subsection (a).

7 SEC. 802. APPLICATION OF OWNERSHIP REQUIREMENTS.

8 (a) SMALL BUSINESS ACT.—Section 7(a) of the

9 Small Business Act (15 U.S.C. 636(a)) is amended by

10 adding at the end the following:

11 ‘‘(30) OWNERSHIP REQUIREMENTS.—Owner12 ship requirements to determine the eligibility of a

13 small business concern that applies for assistance

14 under any credit program under this Act shall be de15 termined without regard to any ownership interest of

16 a spouse arising solely from the application of the

17 community property laws of a State for purposes of

18 determining marital interests.’’.

19 (b) SMALL BUSINESS INVESTMENT ACT OF 1958.—

20 Section 502 of the Small Business Investment Act of 1958

21 (15 U.S.C. 696) is amended by adding at the end the fol22 lowing:

23 ‘‘(6) OWNERSHIP REQUIREMENTS.—Ownership

24 requirements to determine the eligibility of a small

25 business concern that applies for assistance under
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1 any credit program under this title shall be deter2 mined without regard to any ownership interest of a

3 spouse arising solely from the application of the

4 community property laws of a State for purposes of

5 determining marital interests.’’.

6 SEC. 803. SUBCONTRACTING PREFERENCE FOR VETERANS.

7 Section 8(d) of the Small Business Act (15 U.S.C.

8 637(d)) is amended—

9 (1) in paragraph (1), by inserting ‘‘small busi10 ness concerns owned and controlled by veterans,’’

11 after ‘‘small business concerns,’’ the first place that

12 term appears in each of the first and second sen13 tences;

14 (2) in paragraph (3)—

15 (A) in subparagraph (A), by inserting

16 ‘‘small business concerns owned and controlled

17 by service-disabled veterans,’’ after ‘‘small busi18 ness concerns owned and controlled by vet19 erans,’’ in each of the first and second sen20 tences; and

21 (B) in subparagraph (F), by inserting

22 ‘‘small business concern owned and controlled

23 by service-disabled veterans,’’ after ‘‘small busi24 ness concern owned and controlled by vet25 erans,’’; and
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1 (3) in each of paragraphs (4)(D), (4)(E),

2 (6)(A), (6)(C), (6)(F), and (10)(B), by inserting

3 ‘‘small business concerns owned and controlled by

4 service-disabled veterans,’’ after ‘‘small business con5 cerns owned and controlled by veterans,’’.

6 SEC. 804. SMALL BUSINESS DEVELOPMENT CENTER PRO7 GRAM FUNDING.

8 (a) AUTHORIZATION.—

9 (1) IN GENERAL.—Section 20(a)(1) of the

10 Small Business Act (15 U.S.C. 631 note) is amend11 ed by striking ‘‘For fiscal year 1985’’ and all that

12 follows through ‘‘expended.’’ and inserting the fol13 lowing: ‘‘For fiscal year 2000 and each fiscal year

14 thereafter, there are authorized to be appropriated

15 such sums as may be necessary and appropriate, to

16 remain available until expended, and to be available

17 solely—

18 ‘‘(A) to carry out the Small Business Develop19 ment Center Program under section 21, but not to

20 exceed the annual funding level, as specified in sec21 tion 21(a);

22 ‘‘(B) to pay the expenses of the National Small

23 Business Development Center Advisory Board, as

24 provided in section 21(i);
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1 ‘‘(C) to pay the expenses of the information

2 sharing system, as provided in section 21(c)(8);

3 ‘‘(D) to pay the expenses of the association re4 ferred to in section 21(a)(3)(A) for conducting the

5 certification program, as provided in section

6 21(k)(2); and

7 ‘‘(E) to pay the expenses of the Administration,

8 including salaries of examiners, for conducting ex9 aminations as part of the certification program con10 ducted by the association referred to in section

11 21(a)(3)(A).’’.

12 (2) TECHNICAL AMENDMENT.—Section 20(a) of

13 the Small Business Act (15 U.S.C. 631 note) is

14 amended by moving the margins of paragraphs (3)

15 and (4), including subparagraphs (A) and (B) of

16 paragraph (4), 2 ems to the left.

17 (b) FUNDING FORMULA.—Section 21(a)(4)(C) of the

18 Small Business Act (15 U.S.C. 648(a)(4)(C)) is amended

19 to read as follows:

20 ‘‘(C) FUNDING FORMULA.—

21 ‘‘(i) IN GENERAL.—Subject to clause (iii),

22 the amount of a formula grant received by a

23 State under this subparagraph shall be equal to

24 an amount determined in accordance with the

25 following formula:
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1 ‘‘(I) The annual amount made avail2 able under section 20(a) for the Small

3 Business Development Center Program,

4 less any reductions made for expenses au5 thorized by clause (v) of this subpara6 graph, shall be divided on a pro rata basis,

7 based on the percentage of the population

8 of each State, as compared to the popu9 lation of the United States.

10 ‘‘(II) If the pro rata amount cal11 culated under subclause (I) for any State

12 is less than the minimum funding level

13 under clause (iii), the Administration shall

14 determine the aggregate amount necessary

15 to achieve that minimum funding level for

16 each such State.

17 ‘‘(III) The aggregate amount cal18 culated under subclause (II) shall be de19 ducted from the amount calculated under

20 subclause (I) for States eligible to receive

21 more than the minimum funding level. The

22 deductions shall be made on a pro rata

23 basis, based on the population of each such

24 State, as compared to the total population

25 of all such States.
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1 ‘‘(IV) The aggregate amount deducted

2 under subclause (III) shall be added to the

3 grants of those States that are not eligible

4 to receive more than the minimum funding

5 level in order to achieve the minimum

6 funding level for each such State, except

7 that the eligible amount of a grant to any

8 State shall not be reduced to an amount

9 below the minimum funding level.

10 ‘‘(ii) GRANT DETERMINATION.—The

11 amount of a grant that a State is eligible to

12 apply for under this subparagraph shall be the

13 amount determined under clause (i), subject to

14 any modifications required under clause (iii),

15 and shall be based on the amount available for

16 the fiscal year in which performance of the

17 grant commences, but not including amounts

18 distributed in accordance with clause (iv). The

19 amount of a grant received by a State under

20 any provision of this subparagraph shall not ex21 ceed the amount of matching funds from

22 sources other than the Federal Government, as

23 required under subparagraph (A).

24 ‘‘(iii) MINIMUM FUNDING LEVEL.—The

25 amount of the minimum funding level for each
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1 State shall be determined for each fiscal year

2 based on the amount made available for that

3 fiscal year to carry out this section, as follows:

4 ‘‘(I) If the amount made available is

5 not less than $81,500,000 and not more

6 than $90,000,000, the minimum funding

7 level shall be $500,000.

8 ‘‘(II) If the amount made available is

9 less than $81,500,000, the minimum fund10 ing level shall be the remainder of

11 $500,000 minus a percentage of $500,000

12 equal to the percentage amount by which

13 the amount made available is less than

14 $81,500,000.

15 ‘‘(III) If the amount made available is

16 more than $90,000,000, the minimum

17 funding level shall be the sum of $500,000

18 plus a percentage of $500,000 equal to the

19 percentage amount by which the amount

20 made available exceeds $90,000,000.

21 ‘‘(iv) DISTRIBUTIONS.—Subject to clause

22 (iii), if any State does not apply for, or use, its

23 full funding eligibility for a fiscal year, the Ad24 ministration shall distribute the remaining

25 funds as follows:
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1 ‘‘(I) If the grant to any State is less

2 than the amount received by that State in

3 fiscal year 2000, the Administration shall

4 distribute such remaining funds, on a pro

5 rata basis, based on the percentage of

6 shortage of each such State, as compared

7 to the total amount of such remaining

8 funds available, to the extent necessary in

9 order to increase the amount of the grant

10 to the amount received by that State in fis11 cal year 2000, or until such funds are ex12 hausted, whichever first occurs.

13 ‘‘(II) If any funds remain after the

14 application of subclause (I), the remaining

15 amount may be distributed as supple16 mental grants to any State, as the Admin17 istration determines, in its discretion, to be

18 appropriate, after consultation with the as19 sociation referred to in subsection

20 (a)(3)(A).

21 ‘‘(v) USE OF AMOUNTS.—

22 ‘‘(I) IN GENERAL.—Of the amounts

23 made available in any fiscal year to carry

24 out this section—
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1 ‘‘(aa) not more than $500,000

2 may be used by the Administration to

3 pay expenses enumerated in subpara4 graphs (B) through (D) of section

5 20(a)(1); and

6 ‘‘(bb) not more than $500,000

7 may be used by the Administration to

8 pay the examination expenses enumer9 ated in section 20(a)(1)(E).

10 ‘‘(II) LIMITATION.—No funds de11 scribed in subclause (I) may be used for

12 examination expenses under section

13 20(a)(1)(E) if the usage would reduce the

14 amount of grants made available under

15 clause (i)(I) of this subparagraph to less

16 than $85,000,000 (after excluding any

17 amounts provided in appropriations Acts

18 for specific institutions or for purposes

19 other than the general small business de20 velopment center program) or would fur21 ther reduce the amount of such grants

22 below such amount.

23 ‘‘(vi) EXCLUSIONS.—Grants provided to a

24 State by the Administration or another Federal

25 agency to carry out subsection (a)(6) or
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1 (c)(3)(G), or for supplemental grants set forth

2 in clause (iv)(II) of this subparagraph, shall not

3 be included in the calculation of maximum

4 funding for a State under clause (ii) of this

5 subparagraph.

6 ‘‘(vii) AUTHORIZATION OF APPROPRIA7 TIONS.—There is authorized to be appropriated

8 to carry out this subparagraph $125,000,000

9 for each of fiscal years 2001, 2002, and 2003.

10 ‘‘(viii) STATE DEFINED.—In this subpara11 graph, the term ‘State’ means each of the sev12 eral States, the District of Columbia, the Com13 monwealth of Puerto Rico, the Virgin Islands,

14 Guam, and American Samoa.’’.

15 SEC. 805. SURETY BONDS.

16 (a) CONTRACT AMOUNTS.—Section 411 of the Small

17 Business Investment Act of 1958 (15 U.S.C. 694b) is

18 amended—

19 (1) in subsection (a)(1), by striking

20 ‘‘$1,250,000’’ and inserting ‘‘$2,000,000’’; and

21 (2) in subsection (e)(2), by striking

22 ‘‘$1,250,000’’ and inserting ‘‘$2,000,000’’.

23 (b) EXTENSION OF CERTAIN AUTHORITY.—Section

24 207 of the Small Business Administration Reauthorization
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1 and Amendment Act of 1988 (15 U.S.C. 694b note) is

2 amended by striking ‘‘2000’’ and inserting ‘‘2003’’.

3 SEC. 806. SIZE STANDARDS.

4 (a) INDUSTRY CLASSIFICATIONS.—Section 15(a) of

5 the Small Business Act (15 U.S.C. 644(a)) is amended

6 in the eighth sentence, by striking ‘‘four-digit standard’’

7 and all that follows through ‘‘published’’ and inserting

8 ‘‘definition of a ‘United States industry’ under the North

9 American Industry Classification System, as established’’.

10 (b) ANNUAL RECEIPTS.—Section 3(a)(1) of the

11 Small Business Act (15 U.S.C. 632(a)(1)) is amended by

12 striking ‘‘$500,000’’ and inserting ‘‘$750,000’’.

13 SEC. 807. NATIVE HAWAIIAN ORGANIZATIONS UNDER SEC14 TION 8(a).

15 Section 8(a)(15)(A) of the Small Business Act (15

16 U.S.C. 637(a)(15)(A)) is amended to read as follows:

17 ‘‘(A) is a nonprofit corporation that has filed

18 articles of incorporation with the director (or the

19 designee thereof) of the Hawaii Department of Com20 merce and Consumer Affairs, or any successor agen21 cy,’’.

22 SEC. 808. NATIONAL VETERANS BUSINESS DEVELOPMENT

23 CORPORATION CORRECTION.

24 Section 33(k) of the Small Business Act (15 U.S.C.

25 657c(k)) is amended—
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1 (1) by striking paragraph (1) and inserting the

2 following:

3 ‘‘(1) IN GENERAL.—Subject to paragraph (2),

4 there are authorized to be appropriated to the Cor5 poration to carry out this section—

6 ‘‘(A) $4,000,000 for fiscal year 2001;

7 ‘‘(B) $4,000,000 for fiscal year 2002;

8 ‘‘(C) $2,000,000 for fiscal year 2003; and

9 ‘‘(D) $2,000,000 for fiscal year 2004.’’;

10 (2) in paragraph (2)(A), by striking ‘‘2001’’

11 each place it appears and inserting ‘‘2002’’; and

12 (3) in paragraph (2)(B), by striking ‘‘2002 or

13 2003’’ and inserting ‘‘2003 or 2004’’.

14 SEC. 809. PRIVATE SECTOR RESOURCES FOR SCORE.

15 Section 8(b)(1)(B) of the Small Business Act (15

16 U.S.C. 637(b)(1)(B)) is amended by adding at the end

17 the following: ‘‘Notwithstanding any other provision of

18 law, SCORE may solicit cash and in-kind contributions

19 from the private sector to be used to carry out its func20 tions under this Act, and may use payments made by the

21 Administration pursuant to this subparagraph for such so22 licitation.’’.
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1 SEC. 810. CONTRACT DATA COLLECTION.

2 Section 15 of the Small Business Act (15 U.S.C. 644)

3 is amended by adding at the end the following new sub4 section:

5 ‘‘(p) DATABASE, ANALYSIS, AND ANNUAL REPORT

6 WITH RESPECT TO BUNDLED CONTRACTS.—

7 ‘‘(1) BUNDLED CONTRACT DEFINED.—In this

8 subsection, the term ‘bundled contract’ includes—

9 ‘‘(A) each contract that meets the defini10 tion set forth in section 3(o) regardless of

11 whether the contracting agency has conducted a

12 study of the effects of the solicitation for the

13 contract on civilian or military personnel of the

14 United States; and

15 ‘‘(B) each new procurement requirement

16 that permits the consolidation of two or more

17 procurement requirements.

18 ‘‘(2) DATABASE.—

19 ‘‘(A) IN GENERAL.—Not later than 180

20 days after the date of the enactment of the

21 Small Business Reauthorization Act of 2000,

22 the Administrator of the Small Business Ad23 ministration shall develop and shall thereafter

24 maintain a database containing data and infor25 mation regarding—
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1 ‘‘(i) each bundled contract awarded by

2 a Federal agency; and

3 ‘‘(ii) each small business concern that

4 has been displaced as a prime contractor

5 as a result of the award of such a contract.

6 ‘‘(3) ANALYSIS.—For each bundled contract

7 that is to be recompeted as a bundled contract, the

8 Administrator shall determine—

9 ‘‘(A) the amount of savings and benefits

10 (in accordance with subsection (e)) achieved

11 under the bundling of contract requirements;

12 and

13 ‘‘(B) whether such savings and benefits

14 will continue to be realized if the contract re15 mains bundled, and whether such savings and

16 benefits would be greater if the procurement re17 quirements were divided into separate solicita18 tions suitable for award to small business con19 cerns.

20 ‘‘(4) ANNUAL REPORT ON CONTRACT BUN21 DLING.—

22 ‘‘(A) IN GENERAL.—Not later than 1 year

23 after the date of the enactment of the Small

24 Business Reauthorization Act of 2000, and an25 nually in March thereafter, the Administration
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1 shall transmit a report on contract bundling to

2 the Committees on Small Business of the

3 House of Representatives and the Senate.

4 ‘‘(B) CONTENTS.—Each report trans5 mitted under subparagraph (A) shall include—

6 ‘‘(i) data on the number, arranged by

7 industrial classification, of small business

8 concerns displaced as prime contractors as

9 a result of the award of bundled contracts

10 by Federal agencies; and

11 ‘‘(ii) a description of the activities

12 with respect to previously bundled con13 tracts of each Federal agency during the

14 preceding year, including—

15 ‘‘(I) data on the number and

16 total dollar amount of all contract re17 quirements that were bundled; and

18 ‘‘(II) with respect to each bun19 dled contract, data or information

20 on—

21 ‘‘(aa) the justification for

22 the bundling of contract require23 ments;

24 ‘‘(bb) the cost savings real25 ized by bundling the contract re-
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1 quirements over the life of the

2 contract;

3 ‘‘(cc) the extent to which

4 maintaining the bundled status

5 of contract requirements is pro6 jected to result in continued cost

7 savings;

8 ‘‘(dd) the extent to which

9 the bundling of contract require10 ments complied with the con11 tracting agency’s small business

12 subcontracting plan, including

13 the total dollar value awarded to

14 small business concerns as sub15 contractors and the total dollar

16 value previously awarded to small

17 business concerns as prime con18 tractors; and

19 ‘‘(ee) the impact of the bun20 dling of contract requirements on

21 small business concerns unable to

22 compete as prime contractors for

23 the consolidated requirements

24 and on the industries of such

25 small business concerns, includ-
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1 ing a description of any changes

2 to the proportion of any such in3 dustry that is composed of small

4 business concerns.’’.

5 SEC. 811. PROCUREMENT PROGRAM FOR WOMEN-OWNED

6 SMALL BUSINESS CONCERNS.

7 Section 8 of the Small Business Act (15 U.S.C. 637)

8 is amended by adding at the end the following:

9 ‘‘(m) PROCUREMENT PROGRAM FOR WOMEN-OWNED

10 SMALL BUSINESS CONCERNS.—

11 ‘‘(1) DEFINITIONS.—In this subsection, the fol12 lowing definitions apply:

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

14 ‘contracting officer’ has the meaning given such

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

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

17 ‘‘(B) SMALL BUSINESS CONCERN OWNED

18 AND CONTROLLED BY WOMEN.—The term

19 ‘small business concern owned and controlled by

20 women’ has the meaning given such term in

21 section 3(n), except that ownership shall be de22 termined without regard to any community

23 property law.

24 ‘‘(2) AUTHORITY TO RESTRICT COMPETITION.—

25 In accordance with this subsection, a contracting of-
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1 ficer may restrict competition for any contract for

2 the procurement of goods or services by the Federal

3 Government to small business concerns owned and

4 controlled by women, if—

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

6 51 percent owned by 1 or more women who are

7 economically disadvantaged (and such owner8 ship is determined without regard to any com9 munity property law);

10 ‘‘(B) the contracting officer has a reason11 able expectation that 2 or more small business

12 concerns owned and controlled by women will

13 submit offers for the contract;

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

15 goods or services with respect to an industry

16 identified by the Administrator pursuant to

17 paragraph (3);

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

19 contract (including options) does not exceed—

20 ‘‘(i) $5,000,000, in the case of a con21 tract assigned an industrial classification

22 code for manufacturing; or

23 ‘‘(ii) $3,000,000, in the case of all

24 other contracts;
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1 ‘‘(E) in the estimation of the contracting

2 officer, the contract award can be made at a

3 fair and reasonable price; and

4 ‘‘(F) each of the concerns—

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

6 a State government, or a national certi7 fying entity approved by the Adminis8 trator, as a small business concern owned

9 and controlled by women; or

10 ‘‘(ii) certifies to the contracting officer

11 that it is a small business concern owned

12 and controlled by women and provides ade13 quate documentation, in accordance with

14 standards established by the Administra15 tion, to support such certification.

16 ‘‘(3) WAIVER.—With respect to a small busi17 ness concern owned and controlled by women, the

18 Administrator may waive subparagraph (2)(A) if the

19 Administrator determines that the concern is in an

20 industry in which small business concerns owned

21 and controlled by women are substantially underrep22 resented.

23 ‘‘(4) IDENTIFICATION OF INDUSTRIES.—The

24 Administrator shall conduct a study to identify in25 dustries in which small business concerns owned and
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1 controlled by women are underrepresented with re2 spect to Federal procurement contracting.

3 ‘‘(5) ENFORCEMENT; PENALTIES.—

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

5 carrying out this subsection, the Administrator

6 shall establish procedures relating to—

7 ‘‘(i) the filing, investigation, and dis8 position by the Administration of any chal9 lenge to the eligibility of a small business

10 concern to receive assistance under this

11 subsection (including a challenge, filed by

12 an interested party, relating to the veracity

13 of a certification made or information pro14 vided to the Administration by a small

15 business concern under paragraph (2)(F));

16 and

17 ‘‘(ii) verification by the Administrator

18 of the accuracy of any certification made

19 or information provided to the Administra20 tion by a small business concern under

21 paragraph (2)(F).

22 ‘‘(B) EXAMINATIONS.—The procedures es23 tablished under subparagraph (A) may provide

24 for program examinations (including random

25 program examinations) by the Administrator of
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1 any small business concern making a certifi2 cation or providing information to the Adminis3 trator under paragraph (2)(F).

4 ‘‘(C) PENALTIES.—In addition to the pen5 alties described in section 16(d), any small busi6 ness concern that is determined by the Admin7 istrator to have misrepresented the status of

8 that concern as a small business concern owned

9 and controlled by women for purposes of this

10 subsection, shall be subject to—

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

12 States Code; and

13 ‘‘(ii) sections 3729 through 3733 of

14 title 31, United States Code.

15 ‘‘(6) PROVISION OF DATA.—Upon the request

16 of the Administrator, the head of any Federal de17 partment or agency shall promptly provide to the

18 Administrator such information as the Adminis19 trator determines to be necessary to carry out this

20 subsection.’’.
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1 TITLE IX—COMMUNITY RE2 NEWAL AND NEW MARKETS

3 INITIATIVES

4 SEC. 901. NEW MARKETS VENTURE CAPITAL PROGRAM.

5 (a) SHORT TITLE.—This section may be cited as the

6 ‘‘New Markets Venture Capital Program Act of 2000’’.

7 (b) NEW MARKETS VENTURE CAPITAL PROGRAM.—

8 Title III of the Small Business Investment Act of 1958

9 (15 U.S.C. 681 et seq.) is amended—

10 (1) in the heading for the title, by striking

11 ‘‘SMALL BUSINESS INVESTMENT COMPA12 NIES’’ and inserting ‘‘INVESTMENT DIVISION

13 PROGRAMS’’;

14 (2) by inserting before the heading for section

15 301 the following:

16 ‘‘PART A—SMALL BUSINESS INVESTMENT COMPANIES’’;

17 and

18 (3) by adding at the end the following:

19 ‘‘PART B—NEW MARKETS VENTURE CAPITAL PROGRAM

20 ‘‘SEC. 351. DEFINITIONS.

21 ‘‘In this part, the following definitions apply:

22 ‘‘(1) DEVELOPMENTAL VENTURE CAPITAL.—

23 The term ‘developmental venture capital’ means cap24 ital in the form of equity capital investments in busi25 nesses made with a primary objective of fostering
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1 economic development in low-income geographic

2 areas. For the purposes of this paragraph, the term

3 ‘equity capital’ has the same meaning given such

4 term in section 303(g)(4).

5 ‘‘(2) LOW-INCOME INDIVIDUAL.—The term

6 ‘low-income individual’ means an individual whose

7 income (adjusted for family size) does not exceed—

8 ‘‘(A) for metropolitan areas, 80 percent of

9 the area median income; and

10 ‘‘(B) for nonmetropolitan areas, the great11 er of—

12 ‘‘(i) 80 percent of the area median in13 come; or

14 ‘‘(ii) 80 percent of the statewide non15 metropolitan area median income.

16 ‘‘(3) LOW-INCOME GEOGRAPHIC AREA.—The

17 term ‘low-income geographic area’ means—

18 ‘‘(A) any population census tract (or in the

19 case of an area that is not tracted for popu20 lation census tracts, the equivalent county divi21 sion, as defined by the Bureau of the Census of

22 the Department of Commerce for purposes of

23 defining poverty areas), if—

24 ‘‘(i) the poverty rate for that census

25 tract is not less than 20 percent;
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1 ‘‘(ii) in the case of a tract—

2 ‘‘(I) that is located within a met3 ropolitan area, 50 percent or more of

4 the households in that census tract

5 have an income equal to less than 60

6 percent of the area median gross in7 come; or

8 ‘‘(II) that is not located within a

9 metropolitan area, the median house10 hold income for such tract does not

11 exceed 80 percent of the statewide

12 median household income; or

13 ‘‘(iii) as determined by the Adminis14 trator based on objective criteria, a sub15 stantial population of low-income individ16 uals reside, an inadequate access to invest17 ment capital exists, or other indications of

18 economic distress exist in that census

19 tract; or

20 ‘‘(B) any area located within—

21 ‘‘(i) a HUBZone (as defined in sec22 tion 3(p) of the Small Business Act and

23 the implementing regulations issued under

24 that section);
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1 ‘‘(ii) an urban empowerment zone or

2 urban enterprise community (as designated

3 by the Secretary of Housing and Urban

4 Development); or

5 ‘‘(iii) a rural empowerment zone or

6 rural enterprise community (as designated

7 by the Secretary of Agriculture).

8 ‘‘(4) NEW MARKETS VENTURE CAPITAL COM9 PANY.—The term ‘New Markets Venture Capital

10 company’ means a company that—

11 ‘‘(A) has been granted final approval by

12 the Administrator under section 354(e); and

13 ‘‘(B) has entered into a participation

14 agreement with the Administrator.

15 ‘‘(5) OPERATIONAL ASSISTANCE.—The term

16 ‘operational assistance’ means management, mar17 keting, and other technical assistance that assists a

18 small business concern with business development.

19 ‘‘(6) PARTICIPATION AGREEMENT.—The term

20 ‘participation agreement’ means an agreement, be21 tween the Administrator and a company granted

22 final approval under section 354(e), that—

23 ‘‘(A) details the company’s operating plan

24 and investment criteria; and
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1 ‘‘(B) requires the company to make invest2 ments in smaller enterprises at least 80 percent

3 of which are located in low-income geographic

4 areas.

5 ‘‘(7) SPECIALIZED SMALL BUSINESS INVEST6 MENT COMPANY.—The term ‘specialized small busi7 ness investment company’ means any small business

8 investment company that—

9 ‘‘(A) invests solely in small business con10 cerns that contribute to a well-balanced na11 tional economy by facilitating ownership in such

12 concerns by persons whose participation in the

13 free enterprise system is hampered because of

14 social or economic disadvantages;

15 ‘‘(B) is organized or chartered under State

16 business or nonprofit corporations statutes, or

17 formed as a limited partnership; and

18 ‘‘(C) was licensed under section 301(d), as

19 in effect before September 30, 1996.

20 ‘‘(8) STATE.—The term ‘‘State’’ means each of

21 the several States, the District of Columbia, the

22 Commonwealth of Puerto Rico, the Virgin Islands,

23 Guam, American Samoa, the Commonwealth of the

24 Northern Mariana Islands, and any other common25 wealth, territory, or possession of the United States;
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1 ‘‘SEC. 352. PURPOSES.

2 ‘‘The purposes of the New Markets Venture Capital

3 Program established under this part are—

4 ‘‘(1) to promote economic development and the

5 creation of wealth and job opportunities in low-in6 come geographic areas and among individuals living

7 in such areas by encouraging developmental venture

8 capital investments in smaller enterprises primarily

9 located in such areas; and

10 ‘‘(2) to establish a developmental venture cap11 ital program, with the mission of addressing the

12 unmet equity investment needs of small enterprises

13 located in low-income geographic areas, to be admin14 istered by the Administrator—

15 ‘‘(A) to enter into participation agreements

16 with New Markets Venture Capital companies;

17 ‘‘(B) to guarantee debentures of New Mar18 kets Venture Capital companies to enable each

19 such company to make developmental venture

20 capital investments in smaller enterprises in

21 low-income geographic areas; and

22 ‘‘(C) to make grants to New Markets Ven23 ture Capital companies, and to other entities,

24 for the purpose of providing operational assist25 ance to smaller enterprises financed, or ex26 pected to be financed, by such companies.
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1 ‘‘SEC. 353. ESTABLISHMENT.

2 ‘‘In accordance with this part, the Administrator

3 shall establish a New Markets Venture Capital Program,

4 under which the Administrator may—

5 ‘‘(1) enter into participation agreements with

6 companies granted final approval under section

7 354(e) for the purposes set forth in section 352;

8 ‘‘(2) guarantee the debentures issued by New

9 Markets Venture Capital companies as provided in

10 section 355; and

11 ‘‘(3) make grants to New Markets Venture

12 Capital companies, and to other entities, under sec13 tion 358.

14 ‘‘SEC. 354. SELECTION OF NEW MARKETS VENTURE CAP15 ITAL COMPANIES.

16 ‘‘(a) ELIGIBILITY.—A company shall be eligible to

17 apply to participate, as a New Markets Venture Capital

18 company, in the program established under this part if—

19 ‘‘(1) the company is a newly formed for-profit

20 entity or a newly formed for-profit subsidiary of an

21 existing entity;

22 ‘‘(2) the company has a management team with

23 experience in community development financing or

24 relevant venture capital financing; and
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1 ‘‘(3) the company has a primary objective of

2 economic development of low-income geographic

3 areas.

4 ‘‘(b) APPLICATION.—To participate, as a New Mar5 kets Venture Capital company, in the program established

6 under this part a company meeting the eligibility require7 ments set forth in subsection (a) shall submit an applica8 tion to the Administrator that includes—

9 ‘‘(1) a business plan describing how the com10 pany intends to make successful developmental ven11 ture capital investments in identified low-income ge12 ographic areas;

13 ‘‘(2) information regarding the community de14 velopment finance or relevant venture capital quali15 fications and general reputation of the company’s

16 management;

17 ‘‘(3) a description of how the company intends

18 to work with community organizations and to seek

19 to address the unmet capital needs of the commu20 nities served;

21 ‘‘(4) a proposal describing how the company in22 tends to use the grant funds provided under this

23 part to provide operational assistance to smaller en24 terprises financed by the company, including infor25 mation regarding whether the company intends to
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1 use licensed professionals, when necessary, on the

2 company’s staff or from an outside entity;

3 ‘‘(5) with respect to binding commitments to be

4 made to the company under this part, an estimate

5 of the ratio of cash to in-kind contributions;

6 ‘‘(6) a description of the criteria to be used to

7 evaluate whether and to what extent the company

8 meets the objectives of the program established

9 under this part;

10 ‘‘(7) information regarding the management

11 and financial strength of any parent firm, affiliated

12 firm, or any other firm essential to the success of

13 the company’s business plan; and

14 ‘‘(8) such other information as the Adminis15 trator may require.

16 ‘‘(c) CONDITIONAL APPROVAL.—

17 ‘‘(1) IN GENERAL.—From among companies

18 submitting applications under subsection (b), the

19 Administrator shall, in accordance with this sub20 section, conditionally approve companies to partici21 pate in the New Markets Venture Capital Program.

22 ‘‘(2) SELECTION CRITERIA.—In selecting com23 panies under paragraph (1), the Administrator shall

24 consider the following:
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1 ‘‘(A) The likelihood that the company will

2 meet the goals of its business plan.

3 ‘‘(B) The experience and background of

4 the company’s management team.

5 ‘‘(C) The need for developmental venture

6 capital investments in the geographic areas in

7 which the company intends to invest.

8 ‘‘(D) The extent to which the company will

9 concentrate its activities on serving the geo10 graphic areas in which it intends to invest.

11 ‘‘(E) The likelihood that the company will

12 be able to satisfy the conditions under sub13 section (d).

14 ‘‘(F) The extent to which the activities

15 proposed by the company will expand economic

16 opportunities in the geographic areas in which

17 the company intends to invest.

18 ‘‘(G) The strength of the company’s pro19 posal to provide operational assistance under

20 this part as the proposal relates to the ability

21 of the applicant to meet applicable cash require22 ments and properly utilize in-kind contribu23 tions, including the use of resources for the

24 services of licensed professionals, when nec25 essary, whether provided by persons on the
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1 company’s staff or by persons outside of the

2 company.

3 ‘‘(H) Any other factors deemed appro4 priate by the Administrator.

5 ‘‘(3) NATIONWIDE DISTRIBUTION.—The Admin6 istrator shall select companies under paragraph (1)

7 in such a way that promotes investment nationwide.

8 ‘‘(d) REQUIREMENTS TO BE MET FOR FINAL AP9 PROVAL.—The Administrator shall grant each condi10 tionally approved company a period of time, not to exceed

11 2 years, to satisfy the following requirements:

12 ‘‘(1) CAPITAL REQUIREMENT.—Each condi13 tionally approved company shall raise not less than

14 $5,000,000 of private capital or binding capital com15 mitments from one or more investors (other than

16 agencies or departments of the Federal Government)

17 who meet criteria established by the Administrator.

18 ‘‘(2) NONADMINISTRATION RESOURCES FOR

19 OPERATIONAL ASSISTANCE.—

20 ‘‘(A) IN GENERAL.—In order to provide

21 operational assistance to smaller enterprises ex22 pected to be financed by the company, each

23 conditionally approved company—

24 ‘‘(i) shall have binding commitments

25 (for contribution in cash or in kind)—
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1 ‘‘(I) from any sources other than

2 the Small Business Administration

3 that meet criteria established by the

4 Administrator;

5 ‘‘(II) payable or available over a

6 multiyear period acceptable to the Ad7 ministrator (not to exceed 10 years);

8 and

9 ‘‘(III) in an amount not less than

10 30 percent of the total amount of cap11 ital and commitments raised under

12 paragraph (1);

13 ‘‘(ii) shall have purchased an

14 annuity—

15 ‘‘(I) from an insurance company

16 acceptable to the Administrator;

17 ‘‘(II) using funds (other than the

18 funds raised under paragraph (1))

19 from any source other than the Ad20 ministrator; and

21 ‘‘(III) that yields cash payments

22 over a multiyear period acceptable to

23 the Administrator (not to exceed 10

24 years) in an amount not less than 30

25 percent of the total amount of capital
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1 and commitments raised under para2 graph (1); or

3 ‘‘(iii) shall have binding commitments

4 (for contributions in cash or in kind) of the

5 type described in clause (i) and shall have

6 purchased an annuity of the type described

7 in clause (ii), which in the aggregate make

8 available, over a multiyear period accept9 able to the Administrator (not to exceed 10

10 years), an amount not less than 30 percent

11 of the total amount of capital and commit12 ments raised under paragraph (1).

13 ‘‘(B) EXCEPTION.—The Administrator

14 may, in the discretion of the Administrator and

15 based upon a showing of special circumstances

16 and good cause, consider an applicant to have

17 satisfied the requirements of subparagraph (A)

18 if the applicant has—

19 ‘‘(i) a viable plan that reasonably

20 projects the capacity of the applicant to

21 raise the amount (in cash or in-kind) re22 quired under subparagraph (A); and

23 ‘‘(ii) binding commitments in an

24 amount equal to not less than 20 percent
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1 of the total amount required under para2 graph (A).

3 ‘‘(C) LIMITATION.—In order to comply

4 with the requirements of subparagraphs (A)

5 and (B), the total amount of a company’s in6 kind contributions may not exceed 50 percent

7 of the company’s total contributions.

8 ‘‘(e) FINAL APPROVAL; DESIGNATION.—The Admin9 istrator shall, with respect to each applicant conditionally

10 approved to operate as a New Markets Venture Capital

11 company under subsection (c), either—

12 ‘‘(1) grant final approval to the applicant to op13 erate as a New Markets Venture Capital company

14 under this part and designate the applicant as such

15 a company, if the applicant—

16 ‘‘(A) satisfies the requirements of sub17 section (d) on or before the expiration of the

18 time period described in that subsection; and

19 ‘‘(B) enters into a participation agreement

20 with the Administrator; or

21 ‘‘(2) if the applicant fails to satisfy the require22 ments of subsection (d) on or before the expiration

23 of the time period described in that subsection, re24 voke the conditional approval granted under that

25 subsection.
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1 ‘‘SEC. 355. DEBENTURES.

2 ‘‘(a) IN GENERAL.—The Administrator may guar3 antee the timely payment of principal and interest, as

4 scheduled, on debentures issued by any New Markets Ven5 ture Capital company.

6 ‘‘(b) TERMS AND CONDITIONS.—The Administrator

7 may make guarantees under this section on such terms

8 and conditions as it deems appropriate, except that the

9 term of any debenture guaranteed under this section shall

10 not exceed 15 years.

11 ‘‘(c) FULL FAITH AND CREDIT OF THE UNITED

12 STATES.—The full faith and credit of the United States

13 is pledged to pay all amounts that may be required to be

14 paid under any guarantee under this part.

15 ‘‘(d) MAXIMUM GUARANTEE.—

16 ‘‘(1) IN GENERAL.—Under this section, the Ad17 ministrator may guarantee the debentures issued by

18 a New Markets Venture Capital company only to the

19 extent that the total face amount of outstanding

20 guaranteed debentures of such company does not ex21 ceed 150 percent of the private capital of the com22 pany, as determined by the Administrator.

23 ‘‘(2) TREATMENT OF CERTAIN FEDERAL

24 FUNDS.—For the purposes of paragraph (1), private

25 capital shall include capital that is considered to be

26 Federal funds, if such capital is contributed by an
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1 investor other than an agency or department of the

2 Federal Government.

3 ‘‘SEC. 356. ISSUANCE AND GUARANTEE OF TRUST CERTIFI4 CATES.

5 ‘‘(a) ISSUANCE.—The Administrator may issue trust

6 certificates representing ownership of all or a fractional

7 part of debentures issued by a New Markets Venture Cap8 ital company and guaranteed by the Administrator under

9 this part, if such certificates are based on and backed by

10 a trust or pool approved by the Administrator and com11 posed solely of guaranteed debentures.

12 ‘‘(b) GUARANTEE.—

13 ‘‘(1) IN GENERAL.—The Administrator may,

14 under such terms and conditions as it deems appro15 priate, guarantee the timely payment of the principal

16 of and interest on trust certificates issued by the

17 Administrator or its agents for purposes of this sec18 tion.

19 ‘‘(2) LIMITATION.—Each guarantee under this

20 subsection shall be limited to the extent of principal

21 and interest on the guaranteed debentures that com22 pose the trust or pool.

23 ‘‘(3) PREPAYMENT OR DEFAULT.—In the event

24 that a debenture in a trust or pool is prepaid, or in

25 the event of default of such a debenture, the guar-
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1 antee of timely payment of principal and interest on

2 the trust certificates shall be reduced in proportion

3 to the amount of principal and interest such prepaid

4 debenture represents in the trust or pool. Interest on

5 prepaid or defaulted debentures shall accrue and be

6 guaranteed by the Administrator only through the

7 date of payment of the guarantee. At any time dur8 ing its term, a trust certificate may be called for re9 demption due to prepayment or default of all deben10 tures.

11 ‘‘(c) FULL FAITH AND CREDIT OF THE UNITED

12 STATES.—The full faith and credit of the United States

13 is pledged to pay all amounts that may be required to be

14 paid under any guarantee of a trust certificate issued by

15 the Administrator or its agents under this section.

16 ‘‘(d) FEES.—The Administrator shall not collect a fee

17 for any guarantee of a trust certificate under this section,

18 but any agent of the Administrator may collect a fee ap19 proved by the Administrator for the functions described

20 in subsection (f)(2).

21 ‘‘(e) SUBROGATION AND OWNERSHIP RIGHTS.—

22 ‘‘(1) SUBROGATION.—In the event the Adminis23 trator pays a claim under a guarantee issued under

24 this section, it shall be subrogated fully to the rights

25 satisfied by such payment.
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1 ‘‘(2) OWNERSHIP RIGHTS.—No Federal, State,

2 or local law shall preclude or limit the exercise by

3 the Administrator of its ownership rights in the de4 bentures residing in a trust or pool against which

5 trust certificates are issued under this section.

6 ‘‘(f) MANAGEMENT AND ADMINISTRATION.—

7 ‘‘(1) REGISTRATION.—The Administrator may

8 provide for a central registration of all trust certifi9 cates issued under this section.

10 ‘‘(2) CONTRACTING OF FUNCTIONS.—

11 ‘‘(A) IN GENERAL.—The Administrator

12 may contract with an agent or agents to carry

13 out on behalf of the Administrator the pooling

14 and the central registration functions provided

15 for in this section including, notwithstanding

16 any other provision of law—

17 ‘‘(i) maintenance, on behalf of and

18 under the direction of the Administrator,

19 of such commercial bank accounts or in20 vestments in obligations of the United

21 States as may be necessary to facilitate the

22 creation of trusts or pools backed by de23 bentures guaranteed under this part; and
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1 ‘‘(ii) the issuance of trust certificates

2 to facilitate the creation of such trusts or

3 pools.

4 ‘‘(B) FIDELITY BOND OR INSURANCE RE5 QUIREMENT.—Any agent performing functions

6 on behalf of the Administrator under this para7 graph shall provide a fidelity bond or insurance

8 in such amounts as the Administrator deter9 mines to be necessary to fully protect the inter10 ests of the United States.

11 ‘‘(3) REGULATION OF BROKERS AND DEAL12 ERS.—The Administrator may regulate brokers and

13 dealers in trust certificates issued under this section.

14 ‘‘(4) ELECTRONIC REGISTRATION.—Nothing in

15 this subsection may be construed to prohibit the use

16 of a book-entry or other electronic form of registra17 tion for trust certificates issued under this section.

18 ‘‘SEC. 357. FEES.

19 ‘‘Except as provided in section 356(d), the Adminis20 trator may charge such fees as it deems appropriate with

21 respect to any guarantee or grant issued under this part.

22 ‘‘SEC. 358. OPERATIONAL ASSISTANCE GRANTS.

23 ‘‘(a) IN GENERAL.—

24 ‘‘(1) AUTHORITY.—In accordance with this sec25 tion, the Administrator may make grants to New
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1 Markets Venture Capital companies and to other en2 tities, as authorized by this part, to provide oper3 ational assistance to smaller enterprises financed, or

4 expected to be financed, by such companies or other

5 entities.

6 ‘‘(2) TERMS.—Grants made under this sub7 section shall be made over a multiyear period not to

8 exceed 10 years, under such other terms as the Ad9 ministrator may require.

10 ‘‘(3) GRANTS TO SPECIALIZED SMALL BUSINESS

11 INVESTMENT COMPANIES.—

12 ‘‘(A) AUTHORITY.—In accordance with

13 this section, the Administrator may make

14 grants to specialized small business investment

15 companies to provide operational assistance to

16 smaller enterprises financed, or expected to be

17 financed, by such companies after the effective

18 date of the New Markets Venture Capital Pro19 gram Act of 2000.

20 ‘‘(B) USE OF FUNDS.—The proceeds of a

21 grant made under this paragraph may be used

22 by the company receiving such grant only to

23 provide operational assistance in connection

24 with an equity investment (made with capital

25 raised after the effective date of the New Mar-
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1 kets Venture Capital Program Act of 2000) in

2 a business located in a low-income geographic

3 area.

4 ‘‘(C) SUBMISSION OF PLANS.—A special5 ized small business investment company shall

6 be eligible for a grant under this section only if

7 the company submits to the Administrator, in

8 such form and manner as the Administrator

9 may require, a plan for use of the grant.

10 ‘‘(4) GRANT AMOUNT.—

11 ‘‘(A) NEW MARKETS VENTURE CAPITAL

12 COMPANIES.—The amount of a grant made

13 under this subsection to a New Markets Ven14 ture Capital company shall be equal to the re15 sources (in cash or in kind) raised by the com16 pany under with section 354(d)(2).

17 ‘‘(B) OTHER ENTITIES.—The amount of a

18 grant made under this subsection to any entity

19 other than a New Markets Venture capital com20 pany shall be equal to the resources (in cash or

21 in kind) raised by the entity in accordance with

22 the requirements applicable to New Markets

23 Venture Capital companies set forth in section

24 354(d)(2).
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1 ‘‘(5) PRO RATA REDUCTIONS.—If the amount

2 made available to carry out this section is insuffi3 cient for the Administrator to provide grants in the

4 amounts provided for in paragraph (4), the Adminis5 trator shall make pro rata reductions in the amounts

6 otherwise payable to each company and entity under

7 such paragraph.

8 ‘‘(b) SUPPLEMENTAL GRANTS.—

9 ‘‘(1) IN GENERAL.—The Administrator may

10 make supplemental grants to New Markets Venture

11 Capital companies and to other entities, as author12 ized by this part, under such terms as the Adminis13 trator may require, to provide additional operational

14 assistance to smaller enterprises financed, or ex15 pected to be financed, by the companies.

16 ‘‘(2) MATCHING REQUIREMENT.—The Adminis17 trator may require, as a condition of any supple18 mental grant made under this subsection, that the

19 company or entity receiving the grant provide from

20 resources (in cash or in kind), other than those pro21 vided by the Administrator, a matching contribution

22 equal to the amount of the supplemental grant.

23 ‘‘(c) LIMITATION.—None of the assistance made

24 available under this section may be used for any overhead

25 or general and administrative expense of a New Markets
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1 Venture Capital company or a specialized small business

2 investment company.

3 ‘‘SEC. 359. BANK PARTICIPATION.

4 ‘‘(a) IN GENERAL.—Except as provided in subsection

5 (b), any national bank, any member bank of the Federal

6 Reserve System, and (to the extent permitted under appli7 cable State law) any insured bank that is not a member

8 of such system, may invest in any New Markets Venture

9 Capital company, or in any entity established to invest

10 solely in New Markets Venture Capital companies.

11 ‘‘(b) LIMITATION.—No bank described in subsection

12 (a) may make investments described in such subsection

13 that are greater than 5 percent of the capital and surplus

14 of the bank.

15 ‘‘SEC. 360. FEDERAL FINANCING BANK.

16 ‘‘Section 318 shall not apply to any debenture issued

17 by a New Markets Venture Capital company under this

18 part.

19 ‘‘SEC. 361. REPORTING REQUIREMENTS.

20 ‘‘Each New Markets Venture Capital company that

21 participates in the program established under this part

22 shall provide to the Administrator such information as the

23 Administrator may require, including—
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1 ‘‘(1) information related to the measurement

2 criteria that the company proposed in its program

3 application; and

4 ‘‘(2) in each case in which the company under

5 this part makes an investment in, or a loan or grant

6 to, a business that is not located in a low-income ge7 ographic area, a report on the number and percent8 age of employees of the business who reside in such

9 areas.

10 ‘‘SEC. 362. EXAMINATIONS.

11 ‘‘(a) IN GENERAL.—Each New Markets Venture

12 Capital company that participates in the program estab13 lished under this part shall be subject to examinations

14 made at the direction of the Investment Division of the

15 Small Business Administration in accordance with this

16 section.

17 ‘‘(b) ASSISTANCE OF PRIVATE SECTOR ENTITIES.—

18 Examinations under this section may be conducted with

19 the assistance of a private sector entity that has both the

20 qualifications and the expertise necessary to conduct such

21 examinations.

22 ‘‘(c) COSTS.—

23 ‘‘(1) ASSESSMENT.—

24 ‘‘(A) IN GENERAL.—The Administrator

25 may assess the cost of examinations under this
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1 section, including compensation of the exam2 iners, against the company examined.

3 ‘‘(B) PAYMENT.—Any company against

4 which the Administrator assesses costs under

5 this paragraph shall pay such costs.

6 ‘‘(2) DEPOSIT OF FUNDS.—Funds collected

7 under this section shall be deposited in the account

8 for salaries and expenses of the Small Business Ad9 ministration.

10 ‘‘SEC. 363. INJUNCTIONS AND OTHER ORDERS.

11 ‘‘(a) IN GENERAL.—Whenever, in the judgment of

12 the Administrator, a New Markets Venture Capital com13 pany or any other person has engaged or is about to en14 gage in any acts or practices which constitute or will con15 stitute a violation of any provision of this Act, or of any

16 rule or regulation under this Act, or of any order issued

17 under this Act, the Administrator may make application

18 to the proper district court of the United States or a

19 United States court of any place subject to the jurisdiction

20 of the United States for an order enjoining such acts or

21 practices, or for an order enforcing compliance with such

22 provision, rule, regulation, or order, and such courts shall

23 have jurisdiction of such actions and, upon a showing by

24 the Administrator that such New Markets Venture Capital

25 company or other person has engaged or is about to en-
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1 gage in any such acts or practices, a permanent or tem2 porary injunction, restraining order, or other order, shall

3 be granted without bond.

4 ‘‘(b) JURISDICTION.—In any proceeding under sub5 section (a), the court as a court of equity may, to such

6 extent as it deems necessary, take exclusive jurisdiction

7 of the New Market Venture Capital company and the as8 sets thereof, wherever located, and the court shall have

9 jurisdiction in any such proceeding to appoint a trustee

10 or receiver to hold or administer under the direction of

11 the court the assets so possessed.

12 ‘‘(c) ADMINISTRATOR AS TRUSTEE OR RECEIVER.—

13 ‘‘(1) AUTHORITY.—The Administrator may act

14 as trustee or receiver of a New Markets Venture

15 Capital company.

16 ‘‘(2) APPOINTMENT.—Upon request of the Ad17 ministrator, the court may appoint the Adminis18 trator to act as a trustee or receiver of a New Mar19 kets Venture Capital company unless the court

20 deems such appointment inequitable or otherwise in21 appropriate by reason of the special circumstances

22 involved.

23 ‘‘SEC. 364. ADDITIONAL PENALTIES FOR NONCOMPLIANCE.

24 ‘‘(a) IN GENERAL.—With respect to any New Mar25 kets Venture Capital company that violates or fails to
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1 comply with any of the provisions of this Act, of any regu2 lation issued under this Act, or of any participation agree3 ment entered into under this Act, the Administrator may

4 in accordance with this section—

5 ‘‘(1) void the participation agreement between

6 the Administrator and the company; and

7 ‘‘(2) cause the company to forfeit all of the

8 rights and privileges derived by the company from

9 this Act.

10 ‘‘(b) ADJUDICATION OF NONCOMPLIANCE.—

11 ‘‘(1) IN GENERAL.—Before the Administrator

12 may cause a New Markets Venture Capital company

13 to forfeit rights or privileges under subsection (a), a

14 court of the United States of competent jurisdiction

15 must find that the company committed a violation,

16 or failed to comply, in a cause of action brought for

17 that purpose in the district, territory, or other place

18 subject to the jurisdiction of the United States, in

19 which the principal office of the company is located.

20 ‘‘(2) PARTIES AUTHORIZED TO FILE CAUSES OF

21 ACTION.—Each cause of action brought by the

22 United States under this subsection shall be brought

23 by the Administrator or by the Attorney General.
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1 ‘‘SEC. 365. UNLAWFUL ACTS AND OMISSIONS; BREACH OF

2 FIDUCIARY DUTY.

3 ‘‘(a) PARTIES DEEMED TO COMMIT A VIOLATION.—

4 Whenever any New Markets Venture Capital company vio5 lates any provision of this Act, of a regulation issued

6 under this Act, or of a participation agreement entered

7 into under this Act, by reason of its failure to comply with

8 its terms or by reason of its engaging in any act or prac9 tice that constitutes or will constitute a violation thereof,

10 such violation shall also be deemed to be a violation and

11 an unlawful act committed by any person who, directly

12 or indirectly, authorizes, orders, participates in, causes,

13 brings about, counsels, aids, or abets in the commission

14 of any acts, practices, or transactions that constitute or

15 will constitute, in whole or in part, such violation.

16 ‘‘(b) FIDUCIARY DUTIES.—It shall be unlawful for

17 any officer, director, employee, agent, or other participant

18 in the management or conduct of the affairs of a New

19 Markets Venture Capital company to engage in any act

20 or practice, or to omit any act or practice, in breach of

21 the person’s fiduciary duty as such officer, director, em22 ployee, agent, or participant if, as a result thereof, the

23 company suffers or is in imminent danger of suffering fi24 nancial loss or other damage.

25 ‘‘(c) UNLAWFUL ACTS.—Except with the written con26 sent of the Administrator, it shall be unlawful—
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1 ‘‘(1) for any person to take office as an officer,

2 director, or employee of any New Markets Venture

3 Capital company, or to become an agent or partici4 pant in the conduct of the affairs or management of

5 such a company, if the person—

6 ‘‘(A) has been convicted of a felony, or any

7 other criminal offense involving dishonesty or

8 breach of trust, or

9 ‘‘(B) has been found civilly liable in dam10 ages, or has been permanently or temporarily

11 enjoined by an order, judgment, or decree of a

12 court of competent jurisdiction, by reason of

13 any act or practice involving fraud, or breach of

14 trust; and

15 ‘‘(2) for any person continue to serve in any of

16 the capacities described in paragraph (1), if—

17 ‘‘(A) the person is convicted of a felony, or

18 any other criminal offense involving dishonesty

19 or breach of trust, or

20 ‘‘(B) the person is found civilly liable in

21 damages, or is permanently or temporarily en22 joined by an order, judgment, or decree of a

23 court of competent jurisdiction, by reason of

24 any act or practice involving fraud or breach of

25 trust.
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1 ‘‘SEC. 366. REMOVAL OR SUSPENSION OF DIRECTORS OR

2 OFFICERS.

3 ‘‘Using the procedures for removing or suspending a

4 director or an officer of a licensee set forth in section 313

5 (to the extent such procedures are not inconsistent with

6 the requirements of this part), the Administrator may re7 move or suspend any director or officer of any New Mar8 kets Venture Capital company.

9 ‘‘SEC. 367. REGULATIONS.

10 ‘‘The Administrator may issue such regulations as it

11 deems necessary to carry out the provisions of this part

12 in accordance with its purposes.

13 ‘‘SEC. 368. AUTHORIZATIONS OF APPROPRIATIONS.

14 ‘‘(a) IN GENERAL.—There are authorized to be ap15 propriated for fiscal years 2001 through 2006, to remain

16 available until expended, the following sums:

17 ‘‘(1) Such subsidy budget authority as may be

18 necessary to guarantee $150,000,000 of debentures

19 under this part.

20 ‘‘(2) $30,000,000 to make grants under this

21 part.

22 ‘‘(b) FUNDS COLLECTED FOR EXAMINATIONS.—

23 Funds deposited under section 362(c)(2) are authorized

24 to be appropriated only for the costs of examinations

25 under section 362 and for the costs of other oversight ac-
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1 tivities with respect to the program established under this

2 part.’’.

3 (c) CONFORMING AMENDMENT.—Section 20(e)(1)(C)

4 of the Small Business Act (15 U.S.C. 631 note) is amend5 ed by inserting ‘‘part A of’’ before ‘‘title III’’.

6 (d) CALCULATION OF MAXIMUM AMOUNT OF SBIC

7 LEVERAGE.—

8 (1) MAXIMUM LEVERAGE.—Section 303(b)(2)

9 of the Small Business Investment Act of 1958 (15

10 U.S.C. 683(b)(2)) is amended to read as follows:

11 ‘‘(2) MAXIMUM LEVERAGE.—

12 ‘‘(A) IN GENERAL.—After March 31,

13 1993, the maximum amount of outstanding le14 verage made available to a company licensed

15 under section 301(c) of this Act shall be deter16 mined by the amount of such company’s private

17 capital—

18 ‘‘(i) if the company has private capital

19 of not more than $15,000,000, the total

20 amount of leverage shall not exceed 300

21 percent of private capital;

22 ‘‘(ii) if the company has private cap23 ital of more than $15,000,000 but not

24 more than $30,000,000, the total amount

25 of leverage shall not exceed $45,000,000
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1 plus 200 percent of the amount of private

2 capital over $15,000,000; and

3 ‘‘(iii) if the company has private cap4 ital of more than $30,000,000, the total

5 amount of leverage shall not exceed

6 $75,000,000 plus 100 percent of the

7 amount of private capital over $30,000,000

8 but not to exceed an additional

9 $15,000,000.

10 ‘‘(B) ADJUSTMENTS.—

11 ‘‘(i) IN GENERAL.—The dollar

12 amounts in clauses (i), (ii), and (iii) of

13 subparagraph (A) shall be adjusted annu14 ally to reflect increases in the Consumer

15 Price Index established by the Bureau of

16 Labor Statistics of the Department of

17 Labor.

18 (ii) INITIAL ADJUSTMENTS.—The ini19 tial adjustments made under this subpara20 graph after the date of the enactment of

21 the Small Business Reauthorization Act of

22 1997 shall reflect only increases from

23 March 31, 1993.

24 ‘‘(C) INVESTMENTS IN LOW-INCOME GEO25 GRAPHIC AREAS.—In calculating the out-
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1 standing leverage of a company for the pur2 poses of subparagraph (A), the Administrator

3 shall not include the amount of the cost basis

4 of any equity investment made by the company

5 in a smaller enterprise located in a low-income

6 geographic area (as defined in section 351), to

7 the extent that the total of such amounts does

8 not exceed 50 percent of the company’s private

9 capital.’’.

10 (2) MAXIMUM AGGREGATE LEVERAGE.—Section

11 303(b)(4) of the Small Business Investment Act of

12 1958 (15 U.S.C. 683(b)(4)) is amended by adding

13 at the end the following new subparagraph:

14 ‘‘(D) INVESTMENTS IN LOW-INCOME GEO15 GRAPHIC AREAS.—In calculating the aggregate

16 outstanding leverage of a company for the pur17 poses of subparagraph (A), the Administrator

18 shall not include the amount of the cost basis

19 of any equity investment made by the company

20 in a smaller enterprise located in a low-income

21 geographic area (as defined in section 351), to

22 the extent that the total of such amounts does

23 not exceed 50 percent of the company’s private

24 capital.’’.
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1 (e) BANKRUPTCY EXEMPTION FOR NEW MARKETS

2 VENTURE CAPITAL COMPANIES.—Section 109(b)(2) of

3 title 11, United States Code, is amended by inserting ‘‘a

4 New Markets Venture Capital company as defined in sec5 tion 351 of the Small Business Investment Act of 1958,’’

6 after ‘‘homestead association,’’.

7 (f) FEDERAL SAVINGS ASSOCIATIONS.—Section

8 5(c)(4) of the Home Owners’ Loan Act (12 U.S.C.

9 1464(c)(4)) is amended by adding at the end the fol10 lowing:

11 ‘‘(F) NEW MARKETS VENTURE CAPITAL

12 COMPANIES.—A Federal savings association

13 may invest in stock, obligations, or other securi14 ties of any New Markets Venture Capital com15 pany as defined in section 351 of the Small

16 Business investment Act of 1958, except that a

17 Federal savings association may not make any

18 investment under this subparagraph if its ag19 gregate outstanding investment under this sub20 paragraph would exceed 5 percent of the capital

21 and surplus of such savings association.’’.

22 SEC. 902. BUSINESSLINC GRANTS AND COOPERATIVE

23 AGREEMENTS.

24 Section 8 of the Small Business Act (15 U.S.C. 637)

25 is amended by adding at the end the following:
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1 ‘‘(n) BUSINESSLINC GRANTS AND COOPERATIVE

2 AGREEMENTS.—

3 ‘‘(1) IN GENERAL.—In accordance with this

4 subsection, the Administrator may make grants to

5 and enter into cooperative agreements with any coa6 lition of private entities, public entities, or any com7 bination of private and public entities—

8 ‘‘(A) to expand business-to-business rela9 tionships between large and small businesses;

10 and

11 ‘‘(B) to provide businesses, directly or indi12 rectly, with online information and a database

13 of companies that are interested in mentorprote ́

ge

 ́ 14 programs or community-based, state15 wide, or local business development programs.

16 ‘‘(2) MATCHING REQUIREMENT.—Subject to

17 subparagraph (B), the Administrator may make a

18 grant to a coalition under paragraph (1) only if the

19 coalition provides for activities described in para20 graph (1)(A) or (1)(B) an amount, either in kind or

21 in cash, equal to the grant amount.

22 ‘‘(3) AUTHORIZATION OF APPROPRIATIONS.—

23 There is authorized to be appropriated to carry out

24 this subsection $6,600,000, to remain available until
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1 expended, for each of fiscal years 2001 through

2 2006.’’.

Æ