Union Calendar No. 35

103D CONGRESS

1ST SESSION H. R. 820

[Report No. 103–77]

A BILL

To amend the Stevenson-Wydler Technology InnoTechnology, and for other purposes. ing the National Institute of Standards and tration of the Department of Commerce, includ- ize appropriations for the Technology Adminis- technology development and transfer, to author- vation Act of 1980 to enhance manufacturing

MAY 3, 1993

Reported with an amendment, committed to the Commitordered to be printed tee of the Whole House on the State of the Union, and
IB

Union Calendar No. 35

103D CONGRESS

1ST SESSION H. R. 820

[Report No. 103–77]

To amend the Stevenson-Wydler Technology Innovation Act of 1980 to enhance manufacturing technology development and transfer, to authorize

appropriations for the Technology Administration of the Department

of Commerce, including the National Institute of Standards and Technology, and for other purposes.

IN THE HOUSE OF REPRESENTATIVES

FEBRUARY 4, 1993

Mr. VALENTINE (for himself, Mr. BROWN, Mr. MINETA, Mrs. LLOYD, Mr.

GLICKMAN, Mr. VOLKMER, Mr. BOEHLERT, Mr. HALL of Texas, Mr.

MCCURDY, Mr. HENRY, Mr. TORRICELLI, Mr. BOUCHER, Mr. TRAFICANT, Mr. HAYES, Mr. BACCHUS of Florida, Mr. ROEMER, Mr. CRAMER,

Mr. SWETT, Mr. BARCIA, Mr. KLEIN, Mr. FINGERHUT, Mr. MCHALE,

Mr. BECERRA, Ms. HARMAN, Mr. JOHNSON of Georgia, Mr. COPPERSMITH, Ms. ESHOO, Mr. INSLEE, Ms. E.B. JOHNSON of Texas, Mr.

MINGE, Mr. SCOTT, Ms. WOOLSEY, Mr. MOORHEAD, Mr. REGULA, Mr.

RIDGE, Mr. THORNTON, Mr. ENGEL, and Mr. OLVER) introduced the following bill; which was referred to the Committee on Science, Space, and

Technology

MAY 3, 1993

Additional sponsors: Mr. HINCHEY, Mr. DICKS, Mr. EVANS, Mr. HUGHES, Mr.

LANCASTER, Mr. LAFALCE, Mr. MACHTLEY, Mr. KLINK, Mr. MOLLOHAN, Ms. KAPTUR, Ms. SHEPARD, Mr. MEEHAN.

MAY 3, 1993

Reported with an amendment, committed to the Committee of the Whole

House on the State of the Union, and ordered to be printed

[Strike out all after the enacting clause and insert the part printed in italic]

[For text of introduced bill, see copy of bill as introduced on February 4, 1993]
2

•HR 820 RH

A BILL

To amend the Stevenson-Wydler Technology Innovation Act

of 1980 to enhance manufacturing technology development and transfer, to authorize appropriations for the

Technology Administration of the Department of Commerce, including the National Institute of Standards and

Technology, 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 TITLE I—GENERAL PROVISIONS

4 SEC. 101. SHORT TITLE; TABLE OF CONTENTS.

5 (a) SHORT TITLE.—This Act may be cited as the ‘‘Na6 tional Competitiveness Act of 1993’’.

7 (b) TABLE OF CONTENTS.—

TITLE I—GENERAL PROVISIONS

Sec. 101. Short title; table of contents.

Sec. 102. Findings.

Sec. 103. Purposes.

Sec. 104. Definitions.

TITLE II—MANUFACTURING

Subtitle A—Manufacturing Technology and Extension

Sec. 201. Short title.

Sec. 202. Findings, purpose, and statement of policy.

Sec. 203. Role of the Department of Commerce.

Sec. 204. National Technology Outreach Program.

Sec. 205. Advanced Manufacturing Technology Development Program.

Sec. 206. Miscellaneous and conforming amendments.

Sec. 207. Manufacturing Technology Centers.

Sec. 208. State Technology Extension Program.

Subtitle B—National Science Foundation Manufacturing Programs

Sec. 211. Role of the National Science Foundation in manufacturing.

Sec. 212. Engineering and Cooperative Research Centers.

Sec. 213. Manufacturing traineeships and fellowships.

Sec. 214. Total quality management.
3

•HR 820 RH

TITLE III—CRITICAL TECHNOLOGIES

Subtitle A—Benchmarking Science and Technology

Sec. 301. Benchmarking United States science and technology against foreign capabilities.

Subtitle B—Advanced Technology Program

Sec. 321. Development of program plan.

Sec. 322. Large scale research and development consortia.

Sec. 323. Technical amendments.

Subtitle C—Civilian Technology Loan Program

Sec. 331. Loan and loan guarantee authority.

Sec. 332. Operating plan and effective date.

Sec. 333. Terms and conditions.

Sec. 334. Technical assistance for lenders and borrowers.

Sec. 335. Outreach to economically depressed areas.

Sec. 336. Socially and economically disadvantaged individuals.

Sec. 337. Definitions.

Subtitle D—Civilian Technology Development Program

Sec. 341. Short title.

Sec. 342. Definitions.

Sec. 343. Establishment and purpose.

Sec. 344. Advisory Committee.

Sec. 345. Organization and licensing.

Sec. 346. Capital and management requirements.

Sec. 347. Financing for licensees.

Sec. 348. Issuance and guarantee of trust certificates.

Sec. 349. Venture capital for qualified business concerns.

Sec. 350. Operation.

Sec. 351. Regulations; liability.

Sec. 352. Technical assistance for licensees and qualified business concerns.

Sec. 353. Performance measures; Annual report.

Sec. 354. Reports, investigations, and examinations.

Sec. 355. Revocation and suspension of licenses; cease and desist orders.

Sec. 356. Injunctive relief.

Sec. 357. Conflicts of interest.

Sec. 358. Removal or suspension of directors and officers.

Sec. 359. Violations.

Sec. 360. Civil penalties.

Sec. 361. Antitrust savings clause.

TITLE IV—MISCELLANEOUS

Sec. 401. Department of Commerce Technology Advisory Board.

Sec. 402. International standardization.

Sec. 403. Malcolm Baldrige Award amendments.

Sec. 404. Cooperative research and development agreements.

Sec. 405. Competitiveness assessments and evaluations.

Sec. 406. Study of semiconductor lithography technologies.

Sec. 407. American workforce quality partnerships.

Sec. 408. Severability.
4

•HR 820 RH

Sec. 409. Sunset.

Sec. 410. Use of domestic products.

Sec. 411. National Quality Program.

TITLE V—AUTHORIZATIONS OF APPROPRIATIONS

Sec. 501. Technology Administration.

Sec. 502. National Institute of Standards and Technology.

Sec. 503. Additional activities of the Technology Administration.

Sec. 504. National Science Foundation.

Sec. 505. Availability of appropriations.

Sec. 506. Sense of the Congress.

1 SEC. 102. FINDINGS.

2 The Congress finds that—

3 (1) the creation, development, and adoption of

4 advanced technologies are significant determinants of

5 sustainable economic growth, productivity improve6 ment, and competitive standing;

7 (2) over the last decade, the rate of advanced

8 technology adoption in the United States has been

9 about half that of some prominent foreign nations

10 and has contributed to a relative decline in United

11 States industrial competitiveness;

12 (3) maintaining a highly competitive manufac13 turing base in the United States is essential for eco14 nomic prosperity and national welfare and requires

15 continuous development and adoption of advanced

16 manufacturing technologies that will enable United

17 States manufacturers to develop innovative products

18 rapidly and manufacture goods of the highest quality

19 at competitive prices;
5

•HR 820 RH

1 (4) there is general agreement on which fields of

2 technology are critical for economic competitiveness

3 through the first decade of the next century, but the

4 United States Government must pursue a comprehen5 sive strategy to ensure that the appropriate research,

6 development, and applications activities and other re7 forms occur so these technologies are readily available

8 to United States manufacturers for incorporation into

9 products made in the United States;

10 (5) technology-based products of the twenty-first

11 century must be developed incorporating the values of

12 sustainable development, including low energy and

13 material use, safety, recyclability, and minimal pol14 lution;

15 (6) the cost of and difficulty in obtaining invest16 ment capital for small high technology companies are

17 significant deterrents to their formation, development,

18 and growth;

19 (7) standardization of weights and measures, in20 cluding development and promotion of product and

21 quality standards, has a significant role to play in

22 competitiveness;

23 (8) strategic technology planning for sustainable

24 economic growth, the support of critical civilian tech25 nology research, development, and application, and
6

•HR 820 RH

1 advancement of manufacturing technology research,

2 development, and adoption are appropriate Govern3 ment roles; and

4 (9) programs established under this Act, and the

5 amendments made by this Act, shall be funded as a

6 result of shifting the total Federal investment in re7 search and development to achieve a balance between

8 support for defense and civilian activities, and shall

9 not be financed through additional deficit spending.

10 SEC. 103. PURPOSES.

11 The purposes of this Act are to—

12 (1) promote and facilitate the creation, develop13 ment, and adoption of technologies by United States

14 companies throughout the Nation that will contribute

15 significantly to United States competitiveness, em16 ployment, and sustainable economic growth;

17 (2) improve the competitiveness of United States

18 manufacturers, particularly small businesses, by de19 veloping a nationwide technology outreach program

20 to improve access to information, expertise, tech21 nology, and management practices required to com22 pete throughout the world;

23 (3) promote the development and rapid applica24 tion of advanced manufacturing technologies and

25 processes by United States manufacturers, with em-
7

•HR 820 RH

1 phasis on environmentally sound practices and sus2 tainable economic growth;

3 (4) stimulate long-term investment in United

4 States companies engaged in development or utiliza5 tion of critical or other advanced technologies;

6 (5) establish mechanisms to ensure synergistic

7 linkages between Federal, State, and local initiatives

8 aimed at enhancing the competitiveness of United

9 States companies;

10 (6) enhance and expand the core programs of the

11 National Institute of Standards and Technology, in12 cluding the Advanced Technology Program; and

13 (7) monitor and assess foreign technology capa14 bilities relative to those of the United States in order

15 to assist United States companies and policymakers

16 in identifying and responding to competitive opportu17 nities and challenges.

18 SEC. 104. DEFINITIONS.

19 For purposes of this Act—

20 (1) the term ‘‘advanced manufacturing tech21 nology’’ has the meaning given such term in section

22 4 of the Stevenson-Wydler Technology Innovation Act

23 of 1980, as amended by section 206(a) of this Act;

24 (2) the term ‘‘critical technologies’’ means tech25 nologies identified as critical technologies pursuant to
8

•HR 820 RH

1 section 603(d) of the National Science and Technology

2 Policy, Organization, and Priorities Act of 1976 (42

3 U.S.C. 6683(d));

4 (3) the term ‘‘Director’’ means the Director of the

5 Institute;

6 (4) the term ‘‘Institute’’ means the National In7 stitute of Standards and Technology;

8 (5) the term ‘‘modern technology’’ has the mean9 ing given such term in section 4 of the Stevenson10 Wydler Technology Innovation Act of 1980, as

11 amended by section 206(a) of this Act;

12 (6) the term ‘‘Secretary’’ means the Secretary of

13 Commerce;

14 (7) the term ‘‘small business’’ means a United

15 States company that is a small business within the

16 meaning given such term in the Small Business Act;

17 (8) the term ‘‘sustainable economic growth’’ has

18 the meaning given such term in section 4 of the Ste19 venson-Wydler Technology Innovation Act of 1980, as

20 amended by section 206(a) of this Act;

21 (9) the term ‘‘United States company’’ has the

22 meaning given such term in section (4) of the Steven23 son-Wydler Technology Innovation Act of 1980, as

24 amended by section 206(a) of this Act;
9

•HR 820 RH

1 (10) the term ‘‘United States manufacturer’’ has

2 the meaning given such term in section 4 of the Ste3 venson-Wydler Technology Innovation Act of 1980, as

4 amended by section 206(a) of this Act; and

5 (11) the term ‘‘Under Secretary’’ means the

6 Under Secretary of Commerce for Technology.

7 TITLE II—MANUFACTURING

8 Subtitle A—Manufacturing

9 Technology and Extension

10 SEC. 201. SHORT TITLE.

11 This subtitle may be cited as the ‘‘Manufacturing

12 Technology and Extension Act of 1993’’.

13 SEC. 202. FINDINGS, PURPOSE, AND STATEMENT OF POL14 ICY.

15 The Stevenson-Wydler Technology Innovation Act of

16 1980 (15 U.S.C. 3701 et seq.) is amended by adding at the

17 end the following new title:

18 ‘‘TITLE III—MANUFACTURING

19 TECHNOLOGY

20 ‘‘SEC. 301. FINDINGS, PURPOSE, AND STATEMENT OF POL21 ICY.

22 ‘‘(a) FINDINGS.—Congress finds and declares the fol23 lowing:

24 ‘‘(1) United States manufacturers, especially

25 small businesses, require the adoption and implemen-
10

•HR 820 RH

1 tation of both modern and advanced manufacturing

2 and process technologies to meet the challenge of for3 eign competition.

4 ‘‘(2) The development and application of modern

5 and advanced manufacturing technologies are vital to

6 the sustainable economic growth, standard of living,

7 competitiveness in world markets, and national secu8 rity and welfare of the United States.

9 ‘‘(3) New developments in flexible, computer-inte10 grated manufacturing, electronic manufacturing com11 munications networks, and other new technologies

12 make possible dramatic improvements across all in13 dustrial sectors in productivity, quality, and the

14 speed with which United States manufacturers can

15 respond to changing market opportunities.

16 ‘‘(4) The application of advances in computer

17 science and technology to manufacturing is also vital

18 to the Nation’s prosperity, national and economic se19 curity, industrial production, engineering, and sci20 entific advancement.

21 ‘‘(5) The Department of Commerce’s Technology

22 Administration can continue to play an important

23 role in assisting United States companies to develop,

24 test, and adopt modern and advanced manufacturing

25 technologies and in establishing high-performance
11

•HR 820 RH

1 computing technology testbeds to develop, refine, test,

2 and transfer advanced manufacturing and

3 networking technologies and associated applications.

4 ‘‘(b) PURPOSE.—It is the purpose of this title to con5 tribute to the competitiveness of the United States by en6 hancing the Department of Commerce’s technology pro7 grams to—

8 ‘‘(1) provide United States manufacturers, espe9 cially small businesses, with ready access to high

10 quality advice and assistance in the development,

11 adoption, and improvement of modern manufacturing

12 processes and technology, and in solving their specific

13 technology-based problems; and

14 ‘‘(2) encourage, facilitate, and support the devel15 opment and adoption of advanced manufacturing

16 principles and technologies by United States manu17 facturers.

18 ‘‘(c) STATEMENT OF POLICY.—Congress declares that

19 it is the policy of the United States that—

20 ‘‘(1) Federal agencies, particularly the Depart21 ment of Commerce, shall work with United States

22 manufacturers, labor, and the States to ensure that

23 the United States is second to no other nation in the

24 development, adoption, and use of modern and ad25 vanced manufacturing technology;
12

•HR 820 RH

1 ‘‘(2) the Department of Commerce shall work

2 with all the major Federal research and development

3 agencies to encourage the development and adoption,

4 by United States manufacturers, of advanced manu5 facturing technologies, and shall work closely with

6 United States manufacturers and labor, and with the

7 Nation’s universities, to develop and test those tech8 nologies; and

9 ‘‘(3) the Department of Commerce shall place a

10 high priority on the establishment and growth of a

11 National Technology Outreach Program to promote

12 and facilitate the development and use by United

13 States manufacturers of modern and advanced manu14 facturing systems and applications for manufactur15 ing.

16 ‘‘(d) CONSTRUCTION.—Nothing in this title shall be

17 construed as modifying the duties and responsibilities of the

18 Department of Energy with regard to its technology re19 sources and expertise in matters under its jurisdiction.’’.

20 SEC. 203. ROLE OF THE DEPARTMENT OF COMMERCE.

21 Title III of the Stevenson-Wydler Technology Innova22 tion Act of 1980, as added by section 202 of this Act, is

23 further amended by adding at the end the following new

24 section:
13

•HR 820 RH

1 ‘‘SEC. 302. ROLE OF THE DEPARTMENT OF COMMERCE.

2 ‘‘(a) DEPARTMENT OF COMMERCE.—Consistent with

3 the purposes and policies of section 301, the Department

4 of Commerce shall be the lead agency of the Federal Govern5 ment in working with United States manufacturers and

6 labor and the States to develop advanced manufacturing

7 technologies and to promote and assist the adoption and

8 use of modern and advanced manufacturing technologies,

9 practices, and management techniques throughout the Unit10 ed States. In carrying out this title, the Secretary, acting,

11 as appropriate, through the Under Secretary and the Direc12 tor, shall—

13 ‘‘(1) consult and cooperate with other Federal

14 agencies, including the Department of Defense, the

15 Department of Energy, and the National Aeronautics

16 and Space Administration to ensure consistent and,

17 where possible, coordinated efforts to promote the de18 velopment and adoption of modern and advanced

19 manufacturing technologies;

20 ‘‘(2) assist the Office of Science and Technology

21 Policy in its efforts to coordinate the manufacturing

22 technology activities of the various Federal agencies;

23 and

24 ‘‘(3) work with representatives of Federal, State,

25 and local agencies, manufacturing extension pro26 grams, private industry, industry groups, worker or-
14

•HR 820 RH

1 ganizations, and academia to encourage and facilitate

2 the use of both advanced manufacturing technologies,

3 including those developed by the Advanced Manufac4 turing Technology Development Program established

5 under section 304 of this Act, and modern manufac6 turing technologies and practices to United States

7 manufacturers.

8 The Secretary shall annually report to Congress on actions

9 taken under this subsection.

10 ‘‘(b) OTHER FEDERAL AGENCIES.—To the extent per11 mitted by other law, other Federal agencies shall cooperate

12 with the Secretary in carrying out this title.’’.

13 SEC. 204. NATIONAL TECHNOLOGY OUTREACH PROGRAM.

14 Title III of the Stevenson-Wydler Technology Innova15 tion Act of 1980, as added by sections 202 and 203 of this

16 Act, is further amended by adding at the end the following

17 new section:

18 ‘‘SEC. 303. NATIONAL TECHNOLOGY OUTREACH PROGRAM.

19 ‘‘(a) ESTABLISHMENT AND PURPOSE.—There is hereby

20 established a National Technology Outreach Program (in

21 this section referred to as the ‘Outreach Program’), the pur22 pose of which shall be to—

23 ‘‘(1) interconnect, programatically and electroni24 cally, the Nation’s technology and manufacturing ex25 tension centers, programs, and activities;
15

•HR 820 RH

1 ‘‘(2) improve the competitiveness of United

2 States manufacturers and create jobs located in the

3 United States; and

4 ‘‘(3) assist United States manufacturers, espe5 cially small businesses, to expand and accelerate the

6 use of cost-effective modern manufacturing tech7 nologies and practices and to develop and adopt ad8 vanced manufacturing technologies. The Secretary,

9 acting through the Under Secretary and the Director,

10 shall implement and coordinate the Outreach Pro11 gram in accordance with an initial plan and a 5-

12 year plan for the Outreach Program, to be submitted

13 to the Congress under subsection (g).

14 ‘‘(b) PROGRAM COMPONENTS.—The Outreach Program

15 shall constitute a partnership between the Department of

16 Commerce, the States, the private sector, and, as appro17 priate, shall include other Federal agencies to provide a na18 tional system of manufacturing and technology extension

19 centers and technical services to United States manufactur20 ers, particularly small businesses. The Outreach Program

21 shall include—

22 ‘‘(1) Manufacturing Outreach Centers established

23 under subsection (c);

24 ‘‘(2) Regional Centers for the Transfer of Manu25 facturing Technology established under section 25 of
16

•HR 820 RH

1 the National Institute of Standards and Technology

2 Act (15 U.S.C. 278k);

3 ‘‘(3) the State Technology Extension Program es4 tablished under section 26 of the National Institute of

5 Standards and Technology Act (15 U.S.C. 278l);

6 ‘‘(4) the Outreach Program Information Network

7 and the Clearinghouse established under subsections

8 (d) and (e) of this section, respectively; and

9 ‘‘(5) other technology and manufacturing exten10 sion centers that the Secretary considers appropriate

11 for inclusion in the Outreach Program.

12 ‘‘(c) MANUFACTURING OUTREACH CENTERS.—(1) Eli13 gible government and private sector organizations that are

14 engaged in technology or manufacturing extension activities

15 may apply to the Secretary for designation as Manufactur16 ing Outreach Centers, in such form and manner as the Sec17 retary may prescribe. Eligible organizations include Fed18 eral, State, and local government agencies, extension pro19 grams, universities, and laboratories; small business devel20 opment centers; and professional societies, worker organiza21 tions, industrial organizations, nonprofit organizations,

22 community development organizations, community colleges,

23 and technical schools and colleges.

24 ‘‘(2) The Secretary shall establish standards, consistent

25 with the requirements of subsection (f), for designation of
17

•HR 820 RH

1 existing technology or manufacturing extension programs

2 and for qualification of start-up programs as Manufactur3 ing Outreach Centers.

4 ‘‘(3) The Secretary may, through a competitive proc5 ess, make grants, subject to the availability of appropria6 tions, to Manufacturing Outreach Centers designated in ac7 cordance with the standards established under paragraph

8 (2), to enable them to fulfill the purposes and perform the

9 activities of the Outreach Program. If a State plan for tech10 nology extension exists in a State where an applicant for

11 a grant under this paragraph is operating or plans to oper12 ate, the proposer shall demonstrate in its application that

13 its proposal is compatible with such State plan. The pur14 pose of such grants is to upgrade the overall quality of the

15 Outreach Program and to contribute to the goal of ready

16 availability of the services and information provided

17 through the Outreach Program, including information on

18 modern and advanced manufacturing technology, to all in19 terested United States manufacturers. Such grants shall be

20 awarded to increase the capabilities and capacity of Manu21 facturing Outreach Centers. Manufacturing Outreach Cen22 ters may not concurrently receive financial assistance

23 under section 25 of the National Institute of Standards and

24 Technology Act and grants under this paragraph. Grants

25 may be awarded under this paragraph for an initial period
18

•HR 820 RH

1 not to exceed 3 years and may be renewed for one additional

2 period, not to exceed 2 years. Such grants may not at any

3 time exceed 50 percent of the operating costs and in-kind

4 contributions of the grant recipient.

5 ‘‘(4) In selecting applicants to participate in the Out6 reach Program and in making grants under paragraph (3),

7 the Secretary shall solicit and consider evaluations of the

8 applicant’s performance record and current capabilities,

9 and the potential usefulness of the applicant’s proposal,

10 from United States manufacturers that the Secretary con11 siders qualified to make such evaluations.

12 ‘‘(d) OUTREACH PROGRAM INFORMATION NETWORK.—

13 (1) The Department of Commerce shall provide for an in14 stantaneous, interactive electronic communications network

15 (in this section referred to as the ‘outreach network’) to serve

16 the Outreach Program, to facilitate effective and efficient

17 interaction within it, and to permit the collection and dis18 semination in electronic form, in a timely and accurate

19 manner, of information described in subsection (e). The out20 reach network shall, wherever practicable, make use of exist21 ing public and private computer networks, data bases, and

22 electronic bulletin boards. The design, configuration, acqui23 sition plan, and operating policies, including user fees and

24 appropriate electronic access for public and private infor25 mation suppliers and users, of the outreach network shall
19

•HR 820 RH

1 be included in the 5-year plan prepared under subsection

2 (g)(2) and shall address—

3 ‘‘(A) effective mechanisms for providing operat4 ing funds for the maintenance and use of the outreach

5 network established under this paragraph, including

6 user fees, industry support, and continued Federal in7 vestment;

8 ‘‘(B) the future operation and evolution of the

9 outreach network, including its relationship with

10 other public or private information services;

11 ‘‘(C) how to protect the copyrights of material

12 distributed over the outreach network; and

13 ‘‘(D) appropriate policies—

14 ‘‘(i) to ensure the security of proprietary in15 formation that might be available on the out16 reach network and to protect the privacy of users

17 of the outreach network; and

18 ‘‘(ii) to facilitate and limit access to the

19 outreach network and its information to member

20 organizations of the Outreach Program and to

21 United States companies, State and local govern22 ments, United States universities and colleges,

23 and United States nonprofit organizations that

24 the Secretary deems appropriate.
20

•HR 820 RH

1 ‘‘(2) Except as provided in this section, the outreach

2 network established under paragraph (1) shall be designed

3 and configured in a manner that will enable interoper4 ability with networks and technologies developed under the

5 National High-Performance Computing Program described

6 in section 101 of the High-Performance Computing Act of

7 1991 (15 U.S.C. 5511).

8 ‘‘(e) CLEARINGHOUSE.—(1) The Secretary shall de9 velop a clearinghouse system, using existing public and pri10 vate sector information providers and carriers where appro11 priate, to—

12 ‘‘(A) identify expertise and acquire information,

13 appropriate to the purpose of the Outreach Program

14 stated in subsection (a), from all appropriate Federal

15 sources, and where appropriate from other sources,

16 providing assistance where necessary in making such

17 information electronically available through and com18 patible with the outreach network;

19 ‘‘(B) ensure ready access, through the outreach

20 network, by United States companies, Federal agen21 cies, State and local governments, United States uni22 versities and colleges, United States nonprofit organi23 zations that the Secretary deems appropriate, and

24 member organizations of the Outreach Program, to
21

•HR 820 RH

1 the most recent relevant available information and ex2 pertise;

3 ‘‘(C) ensure that common standards of inter4 connection are utilized by the outreach network and

5 the clearinghouse to allow maximum interoperability

6 and usership; and

7 ‘‘(D) to the extent practicable, inform United

8 States manufacturers of the availability of such infor9 mation.

10 ‘‘(2) The clearinghouse shall include information

11 available electronically on—

12 ‘‘(A) activities of Manufacturing Outreach Cen13 ters, Regional Centers for the Transfer of Manufactur14 ing Technology, the State Technology Extension Pro15 gram, and the users of the outreach network;

16 ‘‘(B) domestic and international standards and

17 other export promotion information, including con18 formity assessment requirements and procedures;

19 ‘‘(C) the Malcolm Baldrige Quality program,

20 and quality principles and standards;

21 ‘‘(D) manufacturing processes minimizing waste

22 and negative environmental impact;

23 ‘‘(E) federally funded technology development

24 and transfer programs;

25 ‘‘(F) how to access data bases and services; and
22

•HR 820 RH

1 ‘‘(G) skills training, particularly the implemen2 tation and use of modern and advanced manufactur3 ing techniques.

4 ‘‘(3) The Secretary, acting through the Under Sec5 retary, may convene a national conference to develop rec6 ommendations for common standards for interconnection

7 and for improved dissemination to users of the clearing8 house of information on domestic and international tech9 nical regulations and standards, and on conformity assess10 ment procedures, including draft standards and regula11 tions. Invited participants are to include a broad cross sec12 tion of the standards, accreditation, and user communities.

13 ‘‘(f) ADDITIONAL REQUIREMENTS.—In carrying out

14 this section, the Secretary shall satisfy the following re15 quirements:

16 ‘‘(1) The Outreach Program and the outreach

17 network shall be established and operated through co18 operation and cofunding among Federal, State, and

19 local governments, other public and private contribu20 tors, and end users that the Secretary determines are

21 appropriate for providing maximum benefit to Unit22 ed States manufacturers.

23 ‘‘(2) The Outreach Program and the outreach

24 network shall utilize and leverage, to the extent prac25 ticable, existing organizations, data bases, electronic
23

•HR 820 RH

1 networks, facilities, capabilities, and existing stand2 ards for interconnection, and shall be designed to

3 complement rather than supplant State and local pro4 grams.

5 ‘‘(3) The Outreach Program and the outreach

6 network shall be subject to all applicable provisions of

7 law for the protection of trade secrets and business

8 confidential information.

9 ‘‘(4) Access to the services available through the

10 Outreach Program and information available through

11 the outreach network servicing the Outreach Program

12 shall be limited, as appropriate, to United States

13 companies, State and local governments, United

14 States universities and colleges, and United States

15 nonprofit organizations that the Secretary deems ap16 propriate.

17 ‘‘(5) Local or regional needs should determine

18 the management structure and staffing of the Manu19 facturing Outreach Centers. The Outreach Program

20 shall strive for geographical balance with the ultimate

21 goal of access for all United States manufacturers.

22 ‘‘(6) Manufacturing Outreach Centers should

23 have the capability to deliver outreach services di24 rectly to United States manufacturers, actively work

25 with, rather than supplant, the private sector, and to
24

•HR 820 RH

1 the extent practicable, maximize the exposure of Unit2 ed States manufacturers to demonstrations of modern

3 technologies in use, including flexible manufacturing

4 practices.

5 ‘‘(7) The Department of Commerce shall develop

6 mechanisms for—

7 ‘‘(A) soliciting the perspectives of United

8 States manufacturers using the services of the

9 Manufacturing Outreach Centers and Regional

10 Centers for the Transfer of Manufacturing Tech11 nology; and

12 ‘‘(B) evaluating the effectiveness of the Man13 ufacturing Outreach Centers and Regional Cen14 ters for the Transfer of Manufacturing Tech15 nology.

16 ‘‘(g) PLAN AND REPORTS.—(1) Within 6 months after

17 the date of enactment of this title, the Secretary, after con18 sultation with the Under Secretary, the Director, the De19 partment of Commerce Technology Advisory Board, and a

20 cross-section of potential participants in the Outreach Pro21 gram, shall submit an initial plan for the implementation

22 of this title to Congress—

23 ‘‘(A) describing how the Secretary will carry out

24 the responsibility to create, operate, and support the

25 Outreach Program and the outreach network, includ-
25

•HR 820 RH

1 ing the interactive electronic linkage of Manufactur2 ing Outreach Centers to the programs of the Tech3 nology Administration and other appropriate Fed4 eral, State, and local agencies;

5 ‘‘(B) establishing criteria and procedures, con6 sistent with the requirements of this title, for—

7 ‘‘(i) the selection of organizations to receive

8 Department of Commerce services or financial

9 assistance as part of the Outreach Program, in10 cluding qualifications and training of technology

11 extension agents;

12 ‘‘(ii) access to services provided by partici13 pants in the Outreach Program and to informa14 tion available through the outreach network serv15 icing the Outreach Program; and

16 ‘‘(iii) the annual evaluation of the Outreach

17 Program in achieving the purposes of this title;

18 and

19 ‘‘(C) evaluating the need for and the benefits of

20 a National Conference of States on Technology Exten21 sion, similar in structure to the National Conference

22 on Weights and Measures, and, if the Secretary deter23 mines that such a Conference is advisable, developing,

24 in consultation with the States and other interested
26

•HR 820 RH

1 parties, a plan for the establishment, operation, fund2 ing, and evaluation of such a Conference.

3 ‘‘(2) Within 1 year after the date of enactment of this

4 title, the Secretary, in consultation with the Under Sec5 retary, the Director, and the Department of Commerce

6 Technology Advisory Board, shall prepare and submit to

7 the Congress a 5-year plan for implementing the Outreach

8 Program and the outreach network and clearinghouse estab9 lished under subsections (d) and (e), respectively. Such 5-

10 year plan shall identify appropriate methods for expanding

11 the Outreach Program in a geographically balanced man12 ner. Such 5-year plan shall include a detailed implementa13 tion plan and cost estimates and shall take into consider14 ation and build on the report submitted under paragraph

15 (1).

16 ‘‘(3) Beginning with first year after submission of the

17 5-year plan under paragraph (2), the Secretary shall annu18 ally report to the Congress, at the time of the President’s

19 annual budget request to Congress, on—

20 ‘‘(A) progress made in achieving the purposes of

21 the Outreach Program described in subsection (a)

22 using criteria and procedures established under sub23 section (g)(1)(B)(iii);

24 ‘‘(B) changes proposed to the 5-year plan;

25 ‘‘(C) performance in adhering to schedules; and
27

•HR 820 RH

1 ‘‘(D) any recommendations for legislative

2 changes necessary to enhance the Outreach Program.

3 The report under this paragraph submitted at the end of

4 the fourth year of operation of the Outreach Program shall

5 include recommendations on whether to terminate the Out6 reach Program or extend it for an additional period not

7 to exceed 5 years.’’.

8 SEC. 205. ADVANCED MANUFACTURING TECHNOLOGY DE9 VELOPMENT PROGRAM.

10 Title III of the Stevenson-Wydler Technology Innova11 tion Act of 1980, as added by sections 202, 203, and 204

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

13 following new section:

14 ‘‘SEC. 304. ADVANCED MANUFACTURING TECHNOLOGY DE15 VELOPMENT PROGRAM.

16 ‘‘(a) ESTABLISHMENT.—The Secretary, through the

17 Under Secretary and the Director, shall establish an Ad18 vanced Manufacturing Technology Development Program

19 which shall include projects to develop advanced manufac20 turing systems, networks, and electronic data exchange.

21 ‘‘(b) PURPOSE.—The purpose of the Advanced Manu22 facturing Technology Development Program is to create col23 laborative multiyear technology development programs in24 volving United States companies and, as appropriate, co25 operating with other Federal agencies and laboratories, the
28

•HR 820 RH

1 States, worker organizations, universities and colleges,

2 independent research organizations, and other interested

3 persons, in order to develop, refine, test, and transfer design

4 and manufacturing technologies and associated applica5 tions, including advanced computer integration and elec6 tronic networks for manufacturing information exchange.

7 ‘‘(c) PROGRAM COMPONENTS.—The Advanced Manu8 facturing Technology Development Program shall include—

9 ‘‘(1) the advanced manufacturing research and

10 development activities at the Institute; and

11 ‘‘(2) one or more technology development testbeds

12 within the United States, selected in accordance with

13 procedures, including cost sharing, established for the

14 Advanced Technology Program established under sec15 tion 28 of the National Institute of Standards and

16 Technology Act (15 U.S.C. 278n), whose purpose shall

17 be to develop, refine, and test advanced manufactur18 ing, data exchange, and networking technologies and

19 associated applications and to facilitate the transfer

20 of such technologies and applications to United States

21 manufacturers.

22 ‘‘(d) FUNCTIONS AND ACTIVITIES.—The Advanced

23 Manufacturing Technology Development Program, under

24 the coordination of the Secretary, through the Director,

25 shall—
29

•HR 820 RH

1 ‘‘(1) test and, as appropriate, facilitate and sup2 port the development of the equipment, computer soft3 ware, and systems integration necessary for the suc4 cessful operation within the United States of ad5 vanced design and manufacturing systems and associ6 ated electronic networks;

7 ‘‘(2) establish at the Institute and the technology

8 development testbed or testbeds—

9 ‘‘(A) prototype advanced computer-inte10 grated manufacturing systems;

11 ‘‘(B) prototype electronic networks linking

12 manufacturing systems; and

13 ‘‘(C) prototype clean manufacturing sys14 tems;

15 ‘‘(3) assist United States companies to develop

16 voluntary consensus standards relevant to advanced

17 computer-integrated manufacturing operations, in18 cluding standards for networks, electronic data inter19 change, and digital product data specifications;

20 ‘‘(4) help to make high-performance computing

21 and networking technologies an integral part of de22 sign and production processes where appropriate;

23 ‘‘(5) conduct research to identify and overcome

24 technical barriers to the successful and cost-effective

25 operation of advanced manufacturing systems and
30

•HR 820 RH

1 networks and to promote and facilitate electronic data

2 exchange;

3 ‘‘(6) facilitate the efforts of United States compa4 nies to develop and test new applications for manu5 facturing systems, networks, and information ex6 change;

7 ‘‘(7) involve in the Advanced Manufacturing

8 Technology Development Program, to the maximum

9 extent practicable, both those United States manufac10 turers which make manufacturing technology and re11 lated computer equipment and software, and United

12 States companies which buy such technology, equip13 ment and software;

14 ‘‘(8) identify training needs, as appropriate, for

15 managers, engineers, and employees of United States

16 manufacturers in the operation and applications of

17 advanced manufacturing technologies and networks,

18 with particular emphasis on training for production

19 workers in the effective use of advanced manufactur20 ing technology;

21 ‘‘(9) work with United States companies, univer22 sities, independent research organizations, and other

23 interested parties to develop standards, tools, and

24 techniques for the use of advanced computer-based
31

•HR 820 RH

1 training systems, including multi-media and inter2 active learning technologies;

3 ‘‘(10) involve small businesses in its activities;

4 ‘‘(11) exchange information and personnel, as

5 appropriate, between the technology development

6 testbeds and the outreach network created under sec7 tion 303(d); and

8 ‘‘(12) coordinate its activities with the National

9 High-Performance Computing Program described in

10 section 101 of the High-Performance Computing Act

11 of 1991 (15 U.S.C. 5511) to ensure that both pro12 grams are complementary and compatible.

13 ‘‘(e) TESTBED AWARDS.—(1) In selecting applicants

14 to receive awards under subsection (c)(2) of this section, the

15 Secretary shall give preferential consideration to applicants

16 that have existing computer expertise in manufacturing ap17 plications and the ability to diffuse such expertise to United

18 States companies, and that, in the case of joint research

19 and development ventures, include both suppliers and users

20 of advanced manufacturing technology. In the case of sys21 tems described in subsection (d)(2)(C), the Secretary shall

22 also give preferential consideration to applicants that have

23 existing program expertise in clean manufacturing, includ24 ing the areas of concurrent engineering, materials research,

25 and environmental science, and which have a technology
32

•HR 820 RH

1 transfer mechanism in place to transfer testbed results of

2 a clean manufacturing program to industry participants.

3 ‘‘(2) An industry-led joint research and development

4 venture applying for an award under subsection (c)(2) of

5 this section may include one or more State research organi6 zations, universities, Federal laboratories, independent re7 search organizations, or Regional Centers for the Transfer

8 of Manufacturing Technology (as created under section 25

9 of the National Institute of Standards and Technology Act)

10 and other organizations as the Secretary considers appro11 priate.

12 ‘‘(f) ADVICE AND ASSISTANCE.—(1) Within 6 months

13 after the date of enactment of this title, and before any re14 quest for proposals is issued, the Secretary shall hold one

15 or more workshops to solicit advice from United States com16 panies and from other Federal agencies, particularly the

17 Department of Defense, regarding the specific missions and

18 activities of the testbeds.

19 ‘‘(2) The Secretary shall, to the greatest extent possible,

20 coordinate activities under this section with activities of

21 other Federal agencies and initiatives relating to computer22 aided acquisition and logistics support, electronic data

23 interchange, flexible computer-integrated manufacturing,

24 and enterprise integration.
33

•HR 820 RH

1 ‘‘(3) The Secretary may request and accept funds, fa2 cilities, equipment, or personnel from other Federal agencies

3 in order to carry out this section.

4 ‘‘(g) ANTITRUST SAVINGS CLAUSE.—This section shall

5 not be construed to modify, impair, or supersede the oper6 ation of the antitrust laws. For purposes of this subsection,

7 the term ‘antitrust laws’ has the meaning given it in sub8 section (a) of the first section of the Clayton Act (15 U.S.C.

9 12(a)), except that such term includes the Act of June 19,

10 1936 (49 Stat. 1526; 15 U.S.C. 13 et seq.), commonly

11 known as the Robinson Patman Act, and section 5 of the

12 Federal Trade Commission Act (15 U.S.C. 45) to the extent

13 that such section 5 applies to unfair methods of competi14 tion.’’.

15 SEC. 206. MISCELLANEOUS AND CONFORMING AMEND16 MENTS.

17 (a) DEFINITIONS.—Section 4 of the Stevenson-Wydler

18 Technology Innovation Act of 1980 (15 U.S.C. 3703) is

19 amended by adding at the end the following new para20 graphs:

21 ‘‘(14) ‘Director’ means the Director of the Na22 tional Institute of Standards and Technology.

23 ‘‘(15) ‘Institute’ means the National Institute of

24 Standards and Technology.
34

•HR 820 RH

1 ‘‘(16) ‘Assistant Secretary’ means the Assistant

2 Secretary of Commerce for Technology Policy.

3 ‘‘(17) ‘Advanced manufacturing technology’

4 means—

5 ‘‘(A) numerically-controlled machine tools,

6 robots, automated process control equipment,

7 computerized flexible manufacturing systems, as8 sociated computer software, and other technology

9 for improving manufacturing and industrial

10 production of goods, including biotechnology

11 products, which advance the state-of-the-art; or

12 ‘‘(B) novel manufacturing techniques and

13 processes not previously generally available that

14 improve manufacturing quality, productivity,

15 and practices, including engineering design,

16 quality assurance, concurrent engineering, con17 tinuous process production technology, inventory

18 management, upgraded worker skills, commu19 nications with customers and suppliers, and pro20 motion of sustainable economic growth.

21 ‘‘(18) ‘Modern technology’ means the best avail22 able proven technology, techniques, and processes ap23 propriate to enhancing the productivity of manufac24 turers or to promoting sustainable economic growth.
35

•HR 820 RH

1 ‘‘(19) ‘Sustainable economic growth’ means eco2 nomic growth that enhances the national quality of

3 life and preserves environmental integrity.

4 ‘‘(20) ‘United States company’ means a com5 pany described in section 28(d)(9)(B) of the National

6 Institute of Standards and Technology Act (15 U.S.C.

7 278n(d)(9)(B)).

8 ‘‘(21) ‘United States manufacturer’ means a

9 company described in section 28(d)(9) of the National

10 Institute of Standards and Technology Act (15 U.S.C.

11 278n(d)(9)) that is engaged in manufacturing activi12 ties. The Secretary, in applying subparagraph (A) of

13 such section 28(d)(9) for purposes of this Act, may

14 make a finding under that subparagraph based on

15 certification by the company.

16 ‘‘(22) ‘Benchmarking’ means the assessment of

17 foreign science and technology capabilities relative to

18 comparable United States capabilities.

19 ‘‘(23) ‘Independent research organizations’

20 means nonprofit organizations organized primarily

21 for the purpose of conducting or managing research

22 activities.’’.

23 (b) REDESIGNATIONS.—The Stevenson-Wydler Tech24 nology Innovation Act of 1980 (15 U.S.C. 3701 et seq.) is

25 amended—
36

•HR 820 RH

1 (1) by inserting immediately after section 4 the

2 following new title heading:

3 ‘‘TITLE I—DEPARTMENT OF COM4 MERCE AND RELATED PRO5 GRAMS’’;

6 (2) by redesignating sections 5 through 10 as sec7 tions 101 through 106, respectively;

8 (3) by redesignating sections 16 through 22, as

9 sections 107 through 113, respectively;

10 (4) by inserting immediately after section 113

11 (as redesignated by paragraph (3) of this subsection)

12 the following new title heading:

13 ‘‘TITLE II—FEDERAL

14 TECHNOLOGY TRANSFER’’;

15 (5) by redesignating sections 11 through 15 as

16 sections 201 through 205, respectively;

17 (6) by redesignating section 23 as section 206;

18 (7) in section 4—

19 (A) by striking ‘‘section 5’’ each place it ap20 pears and inserting in lieu thereof ‘‘section 101’’;

21 (B) in paragraphs (4) and (6), by striking

22 ‘‘section 6’’ and ‘‘section 8’’ each place they ap23 pear and inserting in lieu thereof ‘‘section 102’’

24 and ‘‘section 104’’, respectively; and
37

•HR 820 RH

1 (C) in paragraph (13), by striking ‘‘section

2 6’’ and inserting in lieu thereof ‘‘section 102’’;

3 (8) in section 105 (as redesignated by paragraph

4 (2) of this subsection) by striking ‘‘section 6’’ each

5 place it appears and inserting in lieu thereof ‘‘section

6 102’’;

7 (9) in section 106(d) (as redesignated by para8 graph (2) of this subsection) by striking ‘‘7, 9, 11, 15,

9 17, or 20’’ and inserting in lieu thereof ‘‘103, 105,

10 108, 111, 201, or 205’’;

11 (10) in section 201(i) (as redesignated by para12 graph (5) of this subsection) by inserting ‘‘loan, lease,

13 or’’ after ‘‘may’’; and by inserting ‘‘Actions taken

14 under this subsection shall not be subject to Federal

15 requirements on the disposal of property.’’ after

16 ‘‘activities.’’;

17 (11) in section 202(b) (as redesignated by para18 graph (5) of this subsection) by striking ‘‘section 14’’

19 and inserting in lieu thereof ‘‘section 204’’;

20 (12) in section 204(a)(1) (as redesignated by

21 paragraph (5) of this subsection) by striking ‘‘section

22 12’’ and inserting in lieu thereof ‘‘section 202’’;

23 (13) in section 113 (as redesignated by para24 graph (3) of this subsection) by striking ‘‘sections 11,
38

•HR 820 RH

1 12, and 13’’ and inserting in lieu thereof ‘‘sections

2 201, 202, and 203’’;

3 (14) in section 206 (as redesignated by para4 graph (6) of this subsection)—

5 (A) by striking ‘‘section 11(b)’’ in sub6 section (a)(2) and inserting in lieu thereof ‘‘sec7 tion 201(b)’’; and

8 (B) by striking ‘‘section 6(d)’’ in subsection

9 (b) and inserting in lieu thereof ‘‘section

10 102(d)’’; and

11 (15) by adding at the end of section 201 (as re12 designated by paragraph (5) of this subsection) the

13 following new subsection:

14 ‘‘(j) ADDITIONAL TECHNOLOGY TRANSFER MECHA15 NISMS.—In addition to the technology transfer mechanisms

16 set forth in this section and section 202 of this Act, the

17 heads of Federal departments and agencies also may trans18 fer technologies through the technology transfer and exten19 sion programs of the Department of Commerce and the

20 Department of Defense.’’.

21 SEC. 207. MANUFACTURING TECHNOLOGY CENTERS.

22 Section 25 of the National Institute of Standards and

23 Technology Act (15 U.S.C. 278k), is amended—

24 (1) by amending the section heading to read as

25 follows: ‘‘MANUFACTURING TECHNOLOGY CENTERS’’;
39

•HR 820 RH

1 (2) in subsection (c)(5), by striking ‘‘which are

2 designed’’ and all that follows through ‘‘operation of

3 a Center’’ and inserting in lieu thereof ‘‘to a maxi4 mum of one-third Federal funding. Each Center

5 which receives financial assistance under this section

6 shall be evaluated during its sixth year of operation,

7 and at such subsequent times as the Secretary consid8 ers appropriate, by an evaluation panel appointed by

9 the Secretary in the same manner as was the evalua10 tion panel previously appointed. The Secretary shall

11 not provide funding for additional years of the Cen12 ter’s operation unless the evaluation is positive and

13 the Secretary finds that continuation of funding fur14 thers the goals of the Department. Such additional

15 Federal funding shall not exceed one-third of the cost

16 of the Center’s operations’’;

17 (3) by striking subsection (d); and

18 (4) by adding at the end the following new sub19 sections:

20 ‘‘(d) If a Center receives a positive evaluation during

21 its third year of operation, the Director may, any time after

22 that evaluation, contract with the Center to provide addi23 tional technology extension or transfer services above and

24 beyond the baseline activities of the Center. Such additional
40

•HR 820 RH

1 services may include, but are not limited to, the develop2 ment and operation of the following:

3 ‘‘(1) Programs to assist United States companies

4 that are engaged in manufacturing and their employ5 ees, including front-line production workers, in the

6 Center’s region to learn and apply the technologies,

7 techniques, and processes associated with systems

8 management technology, electronic data exchange, or

9 improving manufacturing productivity.

10 ‘‘(2) Services focused on the testing, development,

11 and application of manufacturing and process tech12 nologies within specific technical fields such as ad13 vanced materials or electronics fabrication for the

14 purpose of assisting United States companies that are

15 engaged in manufacturing, both within the Center’s

16 original service region and in other regions, to im17 prove manufacturing quality, product design,

18 workforce training, and production efficiency in those

19 specific technical fields.

20 ‘‘(3) Industry-led demonstration programs that

21 involve United States manufacturing technology con22 sortia to provide ongoing research, technology trans23 fer, and worker training assistance to their members.

24 An award under this paragraph shall be for no more
41

•HR 820 RH

1 than $500,000 per year, and shall be subject to re2 newal after a 1-year demonstration period.

3 ‘‘(e) In addition to any assistance provided or con4 tracts entered into with a Center under this section, the Di5 rector is authorized to make separate and smaller awards,

6 through a competitive process, to nonprofit organizations

7 which wish to work with a Center. Such awards shall be

8 for the purpose of enabling those organizations to provide

9 outreach services, in collaboration with the Center, to Unit10 ed States manufacturers located in parts of the region

11 served by the Center which are not easily accessible to the

12 Center and which are not served by any other manufactur13 ing outreach center. Organizations which receive such

14 awards shall be known as Local Manufacturing Offices. In

15 reviewing applications, the Director shall consider the needs

16 of rural as well as urban manufacturers. No single award

17 for a Local Manufacturing Office shall be for more than

18 three years, awards shall be renewable through the competi19 tive awards process, and no award shall be made unless

20 the applicant provides matching funds at least equal to the

21 amount received under this section.

22 ‘‘(f) In carrying out this section, the Director shall co23 ordinate his efforts with the plans for the National Tech24 nology Outreach Program established under section 303 of

25 the Stevenson-Wydler Technology Innovation Act of 1980.’’.
42

•HR 820 RH

1 SEC. 208. STATE TECHNOLOGY EXTENSION PROGRAM.

2 (a) ESTABLISHMENT.—Section 26(a) of the National

3 Institute of Standards and Technology Act (15 U.S.C.

4 278l(a)), is amended—

5 (1) by inserting immediately after ‘‘(a)’’ the fol6 lowing new sentence: ‘‘There is established within the

7 Institute a State Technology Extension Program.’’;

8 and

9 (2) by inserting ‘‘through that Program’’ imme10 diately after ‘‘technical assistance’’.

11 (b) ADDITIONAL AUTHORITIES.—Section 26 of the Na12 tional Institute of Standards and Technology Act (15

13 U.S.C. 278l) is amended by adding at the end the following

14 new subsection:

15 ‘‘(c) In addition to the general authorities listed in

16 subsection (b) of this section, the State Technology Exten17 sion Program also may, through merit-based competitive re18 view processes—

19 ‘‘(1) make awards to States and conduct work20 shops, pursuant to section 5121(b) of the Omnibus

21 Trade and Competitiveness Act of 1988, in order to

22 help States improve their planning and coordination

23 of technology extension activities;

24 ‘‘(2) support technology demonstration projects

25 to help States provide technical assistance and serv-
43

•HR 820 RH

1 ices to United States manufacturers that will improve

2 their productivity and competitiveness;

3 ‘‘(3) support State efforts to develop and test in4 novative ways to help United States manufacturers

5 improve their technical capabilities;

6 ‘‘(4) support State efforts designed to help Unit7 ed States manufacturers in rural as well as urban

8 areas adopt modern manufacturing technologies;

9 ‘‘(5) support State efforts to assist interested

10 United States manufacturers in the defense industry

11 to adapt to modern or advanced manufacturing tech12 nologies as they convert to nondefense or dual-use

13 purposes;

14 ‘‘(6) support worker technology education pro15 grams in the States at institutions such as research

16 universities, community colleges, labor education cen17 ters, labor-management committees, and worker orga18 nizations in production technologies critical to the

19 Nation’s future, with an emphasis on high-perform20 ance work systems, the skills necessary to use modern

21 or advanced manufacturing systems well;

22 ‘‘(7) help States develop programs to train per23 sonnel who in turn can provide technical skills to

24 managers and workers of United States manufactur25 ers; and
44

•HR 820 RH

1 ‘‘(8) support State efforts to assist United States

2 manufacturers to develop on-the-job training in mod3 ern and advanced manufacturing technologies, tech4 niques, and processes and to promote the development

5 and adoption of modern and advanced manufacturing

6 technologies.’’.

7 Subtitle B—National Science Foun8 dation Manufacturing Programs

9 SEC. 211. ROLE OF THE NATIONAL SCIENCE FOUNDATION

10 IN MANUFACTURING.

11 The Director of the National Science Foundation, after

12 appropriate consultation with the Secretary, the Under Sec13 retary, and the Director, shall—

14 (1) work with United States companies to iden15 tify areas of research in advanced manufacturing

16 technologies and practices that offer the potential to

17 improve United States productivity, competitiveness,

18 employment, and sustainable economic growth;

19 (2) support research at United States univer20 sities to improve advanced manufacturing tech21 nologies and practices; and

22 (3) work with the Technology Administration

23 and the Institute and, as appropriate, other Federal

24 agencies to accelerate the transfer to United States
45

•HR 820 RH

1 companies of manufacturing research and innova2 tions developed at universities.

3 SEC. 212. ENGINEERING AND COOPERATIVE RESEARCH

4 CENTERS.

5 The Director of the National Science Foundation shall

6 strengthen and expand the number of Engineering Research

7 Centers and strengthen and expand the Industry/University

8 Cooperative Research Centers Program with the goal of in9 creasing the engineering talent base versed in critical tech10 nologies, with emphasis on advanced manufacturing tech11 nology and practices, and of advancing fundamental engi12 neering knowledge in these technologies, including bio13 technology. At least one Engineering Research Center shall

14 have a research and education focus on the concerns of

15 United States manufacturers, including small businesses

16 that are trying to modernize their operations. Awards

17 under this section shall be made on a competitive, merit

18 review basis and on terms and conditions the Director may

19 prescribe to ensure that the purposes for which the award

20 is made are satisfied. Such awards may include support

21 for acquisition of instrumentation, equipment, and facili22 ties related to the research and education activities of the

23 Centers and support for undergraduate students to partici24 pate in the activities of the Centers.
46

•HR 820 RH

1 SEC. 213. MANUFACTURING TRAINEESHIPS AND FELLOW2 SHIPS.

3 (a) GRADUATE TRAINEESHIPS.—The Director of the

4 National Science Foundation, in consultation with the Sec5 retary, may establish a program to provide traineeships to

6 graduate students at institutions of higher education within

7 the United States who are citizens of the United States and

8 who choose to pursue masters or doctoral degrees in manu9 facturing engineering. The Director of the National Science

10 Foundation shall make an effort to ensure the provision of

11 traineeships under this subsection to socially and economi12 cally disadvantaged individuals (within the meaning of sec13 tion 8(a) (5) and (6) of the Small Business Act, and includ14 ing women).

15 (b) MANUFACTURING MANAGERS IN THE CLASSROOM

16 PROGRAM.—The Director of the National Science Founda17 tion, in consultation with the Secretary, may establish a

18 program to provide fellowships, on a cost-shared basis, to

19 employees of United States companies with experience in

20 manufacturing to serve for 1 or 2 years as instructors in

21 manufacturing at 2-year community and technical colleges

22 in the United States.

23 SEC. 214. TOTAL QUALITY MANAGEMENT.

24 The Director of the National Science Foundation, in

25 consultation with the Secretary, the Under Secretary, and

26 the Director, may establish a program to develop innovative
47

•HR 820 RH

1 curricula, courses, and materials for use by institutions of

2 higher education for instruction in total quality manage3 ment and related management practices, in order to help

4 improve the productivity of United States companies.

5 TITLE III—CRITICAL

6 TECHNOLOGIES

7 Subtitle A—Benchmarking Science

8 and Technology

9 SEC. 301. BENCHMARKING UNITED STATES SCIENCE AND

10 TECHNOLOGY AGAINST FOREIGN CAPABILI11 TIES.

12 The Stevenson-Wydler Technology Innovation Act of

13 1980, as amended by this Act, is further amended by adding

14 at the end the following new title:

15 ‘‘TITLE IV—BENCHMARKING

16 SCIENCE AND TECHNOLOGY

17 ‘‘SEC. 401. FINDINGS AND PURPOSES.

18 ‘‘(a) FINDINGS.—As other countries have gained

19 strength in new technologies and as centers of technical ex20 cellence have developed around the world, it has become in21 creasingly important for United States companies and re22 search organizations to understand their scientific and tech23 nological capabilities relative to those of other global com24 petitors.
48

•HR 820 RH

1 ‘‘(b) PURPOSES.—The purposes of this title are to con2 duct and coordinate the collection, evaluation, and dissemi3 nation, to United States companies, State and local govern4 ments, and nonprofit organizations, of information on for5 eign science and technology, specifically information assess6 ing foreign capabilities relative to comparable United

7 States capabilities.

8 ‘‘SEC. 402. PROGRAM RESPONSIBILITIES.

9 ‘‘(a) DEPARTMENT OF COMMERCE.—The Department

10 of Commerce shall be the lead agency of the Federal Govern11 ment in making available information for assessing the

12 comparative strength of United States scientific and techno13 logical capabilities. The Secretary, acting through the

14 Under Secretary, shall—

15 ‘‘(1) collect within the Federal Government and

16 disseminate to United States companies, State and

17 local governments, and nonprofit organizations infor18 mation regarding foreign process and product re19 search and technologies of importance to United

20 States companies and the Federal Government, and

21 regarding related technology assessment activities al22 ready underway in the Federal Government;

23 ‘‘(2) provide such information and analyses in

24 electronic form, and ensure, consistent with confiden25 tiality and security considerations, that they will be
49

•HR 820 RH

1 available through the clearinghouse to the outreach

2 network created under section 303 of this Act;

3 ‘‘(3) work, in coordination with the Federal Co4 ordinating Council for Science, Engineering, and

5 Technology, as appropriate, to streamline Federal

6 Government procedures for collecting, evaluating, and

7 disseminating information analyzing foreign sci8 entific and technological information; and

9 ‘‘(4) conduct appropriate planning for more

10 comprehensive collection, evaluation, dissemination,

11 and application of foreign science and technology in12 formation.

13 ‘‘(b) OTHER AGENCIES.—All executive departments

14 and agencies shall assist the Secretary in carrying out this

15 title.

16 ‘‘(c) ADDITIONAL AUTHORITIES.—The Secretary, act17 ing through the Under Secretary, is authorized to—

18 ‘‘(1) arrange for access to information collected

19 and developed under this title, in electronic form or

20 otherwise, by authorized and interested parties, in21 cluding charging and retaining fees;

22 ‘‘(2) provide for the collection of additional in23 formation to fulfill the purposes of this title;

24 ‘‘(3) provide for analysis of foreign research and

25 development activities and technological capabilities,
50

•HR 820 RH

1 particularly in those areas where the United States is

2 considered to be at par or lagging foreign capabilities

3 or where foreign capabilities are projected to overtake

4 those of the United States;

5 ‘‘(4) enter into joint ventures authorized under

6 section 212(a)(1)(A) of Public Law 100–519 (15

7 U.S.C. 3704b(a)(1)(a)) in carrying out this title;

8 ‘‘(5) consult with users of such information, as

9 appropriate, on the usefulness of available foreign sci10 entific and technological information and on the need

11 for additional information and assessment activities

12 and consult with other affected agencies of the Federal

13 Government to promote consistent and useful collec14 tion, assessment, and analysis of foreign technological

15 information; and

16 ‘‘(6) establish and administer the fellowship pro17 gram described in subsection (d).

18 ‘‘(d) FELLOWSHIP PROGRAM.—(1) The Secretary, act19 ing through the Under Secretary, shall establish and ad20 minister a fellowship program to support Technology Fel21 lows to assist the Under Secretary in carrying out activities

22 under this title relating to those countries that are major

23 competitors of the United States in critical technologies,

24 and to identify opportunities for technology transfer to the
51

•HR 820 RH

1 United States or technological collaboration for United

2 States industries.

3 ‘‘(2) Technology Fellows shall—

4 ‘‘(A) regularly report to the Department of Com5 merce on work planned, in progress, and accom6 plished; and

7 ‘‘(B) provide support to the Department of Com8 merce as requested by that Department.

9 ‘‘(3) Fellowships awarded under the program estab10 lished under this subsection shall—

11 ‘‘(A) be awarded for a period of 2 years;

12 ‘‘(B) be reasonable and appropriate; and

13 ‘‘(C) include provisions for living and office ar14 rangements in the host country.

15 ‘‘(4) Only individuals who—

16 ‘‘(A) have at least a bachelors degree in engineer17 ing or science; and

18 ‘‘(B) have at least 5 years of work experience in

19 manufacturing or technology development,

20 shall be eligible for a fellowship under this program.’’.

21 Subtitle B—Advanced Technology

22 Program

23 SEC. 321. DEVELOPMENT OF PROGRAM PLAN.

24 The Secretary, acting through the Under Secretary

25 and the Director, shall, within 6 months after the date of
52

•HR 820 RH

1 enactment of this Act, submit to the Congress a plan for

2 the expansion of the Advanced Technology Program estab3 lished under section 28 of the National Institute of Stand4 ards and Technology Act (15 U.S.C. 278n), with specific

5 consideration given to—

6 (1) closer coordination and cooperation with the

7 Advanced Research Projects Agency and other Federal

8 research and development agencies, including joint

9 funding of large scale consortia, as appropriate;

10 (2) broadening of the scope of the program to in11 clude and focus on as many critical technologies iden12 tified pursuant to section 603(d) of the National

13 Science and Technology Policy, Organization, and

14 Priorities Act of 1976 (42 U.S.C. 6683(d)) as is ap15 propriate; and

16 (3) changes that may be needed when annual

17 funds available for awards and cooperative agree18 ments under the Program reach levels of $200,000,000

19 and $500,000,000.

20 SEC. 322. LARGE SCALE RESEARCH AND DEVELOPMENT

21 CONSORTIA.

22 (a) ESTABLISHMENT OF PROGRAM.—The Secretary,

23 acting through the Director, shall establish a program for

24 the support of large-scale research and development

25 consortia.
53

•HR 820 RH

1 (b) SELECTION PROCEDURES AND REQUIREMENTS.—

2 (1) GENERAL RULE.—Except as provided in

3 paragraph (2), the selection and making of awards to

4 large-scale research and development consortia under

5 this section shall be carried out in accordance with

6 procedures and requirements applicable to joint ven7 tures described in section 28(b)(1) of the National In8 stitute of Standards and Technology Act (15 U.S.C.

9 278n(b)(1)).

10 (2) EXCEPTION.—Notwithstanding section

11 28(b)(1)(B)(ii) of the National Institute of Standards

12 and Technology Act (15 U.S.C. 278n(b)(1)(B)(ii)), for

13 purposes of awards made under this section, a minor14 ity share of the cost of large-scale research and devel15 opment consortia may be provided by the Federal

16 Government for up to 7 years.

17 (c) PROJECT SELECTION.—Preference shall be given

18 for selection under this section to large-scale research and

19 development consortia that would not be undertaken by the

20 private sector without a Federal investment of $50,000,000

21 or more per year.

22 (d) SELECTION CRITERIA.—In selecting large-scale re23 search and development consortia under this section, the

24 Secretary, acting through the Director, shall give priority

25 to consortia that best achieve the following goals:
54

•HR 820 RH

1 (1) Significant contribution to broad economic

2 growth.

3 (2) Significant contribution to the national

4 quality of life.

5 (3) Significant contribution to environmental

6 sustainability.

7 (4) Promotion of private sector partnership with

8 Federal research and development activities.

9 (5) Substantial improvement of the international

10 competitiveness of United States companies.

11 (6) Involvement of several competitor firms in

12 the development of the key consortia technologies.

13 (7) Strengthening of the linkages between domes14 tic suppliers, systems developers, and end-users.

15 (8) Participation by domestic end-users from

16 several industrial sectors.

17 (9) Promotion of the diffusion of nonproprietary

18 information to United States companies through

19 strong links with organizations such as trade and

20 professional groups.

21 (e) INDEPENDENT TECHNICAL REVIEW.—The Sec22 retary, through the Director, shall provide for technical re23 view at least once every three years of large-scale research

24 and development consortia receiving support under this sec25 tion, by the National Institute of Standards and Tech-
55

•HR 820 RH

1 nology, other national laboratories, the Department of Com2 merce Technology Advisory Board established under section

3 401 of this Act, or independent research organizations that

4 are not a participant in the large-scale research and devel5 opment consortium being reviewed. Such review shall be for

6 the purpose of determining progress toward the objectives

7 for which such large-scale research and development consor8 tium was formed, with recommendations for improvement,

9 funding adjustments, or termination of Federal support.

10 The Secretary, through the Director, shall transmit to the

11 Committee on Science, Space, and Technology of the House

12 of Representatives and the Committee on Commerce,

13 Science, and Transportation of the Senate an annual status

14 report summarizing significant accomplishments in achiev15 ing those objectives.

16 (f) DEFINITION.—For purposes of this section, the term

17 ‘‘large-scale research and development consortia’’ means a

18 joint venture described in section 28(b)(1) of the National

19 Institute of Standards and Technology Act (15 U.S.C.

20 278n(b)(1)).

21 SEC. 323. TECHNICAL AMENDMENTS.

22 Section 28 of the National Institute of Standards and

23 Technology Act (15 U.S.C. 278n) is amended—

24 (1) by adding at the end the following new subsection:
56

•HR 820 RH

1 ‘‘(k) Notwithstanding subsections (b)(1)(B)(ii) and

2 (d)(3), the Director may grant an extension of not to exceed

3 6 months beyond the deadlines established under those sub4 sections for joint venture and single applicant awardees to

5 expend Federal funds to complete their projects, if such ex6 tension may be granted with no additional cost to the

7 Federal Government.’’;

8 (2) in subsection (b)(2), by inserting ‘‘, and with

9 independent research organizations’’ after ‘‘especially

10 small businesses’’; and

11 (3) in subsection (j)—

12 (A) by redesignating paragraphs (1) and

13 (2) as paragraphs (2) and (3), respectively; and

14 (B) by inserting before paragraph (2), as so

15 redesignated, the following new paragraph:

16 ‘‘(1) the term ‘independent research organiza17 tions’ means nonprofit organizations organized pri18 marily for the purpose of conducting or managing re19 search activities;’’.

20 Subtitle C—Civilian Technology

21 Loan Program

22 SEC. 331. LOAN AND LOAN GUARANTEE AUTHORITY.

23 To the extent provided in appropriation Acts, the Sec24 retary, acting through the Under Secretary, may make, or

25 enter into agreements to make, loans and loan guarantees,
57

•HR 820 RH

1 either directly or in cooperation with other lenders, to small

2 and medium-sized qualified business concerns in accord3 ance with this subtitle.

4 SEC. 332. OPERATING PLAN AND EFFECTIVE DATE.

5 (a) OPERATING PLAN.—The Secretary, acting through

6 the Under Secretary, shall prepare (in consultation with

7 the Advisory Committee established under section 344, other

8 appropriate executive agencies, the States, United States

9 companies, the financial community, and other appropriate

10 parties) and submit to the Congress on or before November

11 1, 1993, an operating plan to carry out this subtitle. In

12 preparing such plan, the Secretary shall consider and

13 evaluate alternative approaches to achieving the purposes

14 of this subtitle and shall develop recommendations, as ap15 propriate, to fulfill the purposes of this subtitle in the most

16 effective and efficient manner achievable. Such evaluations

17 and recommendations shall be included in the plan submit18 ted under this subsection.

19 (b) EFFECTIVE DATE.—Except as provided in sub20 section (a), the provisions of this subtitle shall take effect

21 on October 1, 1994.

22 SEC. 333. TERMS AND CONDITIONS.

23 Loans and loan guarantees made under section 331

24 shall be in such form and manner and under such terms

25 and conditions as the Under Secretary may prescribe by
58

•HR 820 RH

1 regulation, and shall be subject to the following terms and

2 conditions:

3 (1) Loans awarded or guaranteed shall be for

4 sound financing of research, development, demonstra5 tion, or utilization of critical technologies or ad6 vanced technologies.

7 (2) Loans shall only be awarded or guaranteed

8 if the Under Secretary finds that—

9 (A) sufficient collateral, which may include

10 both tangible and intangible assets, is pledged; or

11 (B) the borrower is sufficiently financially

12 sound,

13 to reasonably ensure repayment.

14 (3) Loans awarded or guaranteed may not ex15 ceed 50 percent of total eligible project costs. For pur16 poses of this section, the term ‘‘eligible project costs’’

17 shall be defined by the Under Secretary by regulation.

18 (4) The total principal amount of outstanding

19 loans awarded or guaranteed to a single borrower

20 may not exceed $2,000,000 at any time.

21 (5) Loans awarded or guaranteed shall be senior

22 to any other debt obligations of the borrower, except

23 to the extent that the Under Secretary considers nec24 essary to accommodate the borrower’s ability to raise

25 sufficient debt or equity capital from non-Federal
59

•HR 820 RH

1 sources to pay the balance of eligible project costs that

2 are not covered by such loans.

3 (6) Interest on a loan, or portion of a loan,

4 awarded or guaranteed by the Federal Government

5 under this subtitle shall be at a rate determined by

6 the Secretary of the Treasury, at the time such loan

7 is made, to equal the then current average market

8 yield on outstanding debt obligations of the United

9 States with remaining periods to maturity com10 parable to the maturity of such loan, plus an addi11 tional charge of up to 1 percent applied by the Under

12 Secretary to cover expected defaults and reasonable

13 administrative costs of carrying out this subtitle. For

14 purposes of this section, the term ‘‘default’’ shall be

15 defined by the Under Secretary by regulation.

16 (7) Except as provided in paragraph (8), the

17 maturity of loans awarded or guaranteed under this

18 subtitle may not be less than 2 years or greater

19 than—

20 (A) 10 years; or

21 (B) the useful life of property, plant, equip22 ment, or other assets, as determined by the Sec23 retary of the Treasury, which have been pledged

24 as collateral for such loan,

25 whichever is greater.
60

•HR 820 RH

1 (8) The Under Secretary may extend the matu2 rity of or renew a loan or extend the guarantee of a

3 loan for additional periods, not to exceed 5 years,

4 only if such extension or renewal will aid in the or5 derly liquidation of such loan.

6 (9) Payment of interest on direct loans made by

7 the Federal Government under this subtitle may be

8 deferred by the borrower, upon approval by the Under

9 Secretary, only to the extent that the borrower has es10 tablished to the satisfaction of the Under Secretary

11 that the borrower has not realized sufficient earnings

12 and returns of capital to make such payment without

13 incurring undue financial hardship, and that there is

14 a reasonable prospect that such loan and interest

15 thereon will be repaid.

16 (10) The Under Secretary may guarantee pay17 ment of 100 percent of principal and interest on a

18 loan made under section 331.

19 (11) The Under Secretary may establish, charge,

20 and regulate fees to cover loan origination and servic21 ing costs that are reasonable and necessary.

22 SEC. 334. TECHNICAL ASSISTANCE FOR LENDERS AND BOR23 ROWERS.

24 The Secretary, acting through the Under Secretary,

25 shall, upon request, provide technical assistance and serv-
61

•HR 820 RH

1 ices, as appropriate and needed, to lenders and borrowers

2 under this subtitle, and shall ensure that such lenders and

3 borrowers have ready access to appropriate assistance avail4 able under title III of the Stevenson-Wydler Technology In5 novation Act of 1980, or under any other Act, in order to

6 aid such lenders and borrowers in achieving the purposes

7 described in section 333(1). The Secretary may charge fees

8 for technical assistance and services provided under this

9 section in amounts sufficient to cover the reasonable cost

10 of such assistance and services. The Secretary may waive

11 such fees on a case-by-case basis. Fees paid to the United

12 States under this section shall be deposited in an account

13 established by the Under Secretary and shall be available

14 solely for carrying out this subtitle, to the extent provided

15 in advance in appropriations Acts.

16 SEC. 335. OUTREACH TO ECONOMICALLY DEPRESSED

17 AREAS.

18 The Secretary, acting through the Under Secretary,

19 shall seek to ensure that qualified business concerns located

20 in areas determined by the Secretary to have a depressed

21 economy, or a significant concentration of defense-related

22 industries, or chronically high unemployment, are notified

23 of the availability of financial assistance through the pro24 gram established under this subtitle and, to the extent prac-
62

•HR 820 RH

1 ticable, to encourage and facilitate the participation of such

2 qualified business concerns in such program.

3 SEC. 336. SOCIALLY AND ECONOMICALLY DISADVANTAGED

4 INDIVIDUALS.

5 The Secretary shall, to the fullest extent possible, en6 sure that at least 10 percent of amounts loaned under this

7 subtitle shall be made available to qualified business con8 cerns owned or controlled by socially and economically dis9 advantaged individuals (within the meaning of section 8(a)

10 (5) and (6) of the Small Business Act, and including

11 women).

12 SEC. 337. DEFINITIONS.

13 For purposes of this subtitle, the terms ‘‘advanced tech14 nologies’’, ‘‘critical technologies’’, and ‘‘qualified business

15 concern’’ have the meaning given such terms in section 342

16 of this Act.

17 Subtitle D—Civilian Technology

18 Development Program

19 SEC. 341. SHORT TITLE.

20 This subtitle may be cited as the ‘‘Civilian Technology

21 Development Act of 1993’’.

22 SEC. 342. DEFINITIONS.

23 For purposes of this subtitle—

24 (1) the term ‘‘advanced technologies’’ means tech25 nologies eligible for assistance under the Advanced
63

•HR 820 RH

1 Technology Program established under section 28 of

2 the National Institute of Standards and Technology

3 Act (15 U.S.C. 278n);

4 (2) the term ‘‘articles’’ means articles of incorpo5 ration for an incorporated body, and the functional

6 equivalent, or other similar documents specified by

7 the Under Secretary, for other business entities;

8 (3) the term ‘‘critical technologies’’ means tech9 nologies identified as critical technologies pursuant to

10 section 603(d) of the National Science and Technology

11 Policy, Organization, and Priorities Act of 1976 (42

12 U.S.C. 6683(d));

13 (4) the term ‘‘Department’’ means the Depart14 ment of Commerce;

15 (5) the term ‘‘executive agency’’ has the meaning

16 given such term in section 105 of title 5, United

17 States Code;

18 (6) the term ‘‘license’’ means a license issued by

19 the Under Secretary under section 345;

20 (7) the term ‘‘licensee’’ means a company li21 censed under section 345;

22 (8) the term ‘‘preferred securities’’ means pre23 ferred stock or a preferred limited partnership inter24 est or other similar security, as defined by the Under

25 Secretary by regulation;
64

•HR 820 RH

1 (9) the term ‘‘private equity capital’’ means the

2 paid-in capital and paid-in surplus, on hand or le3 gally committed to be provided, of a licensee orga4 nized as a corporation, or the partnership capital, on

5 hand or legally committed to be provided, of a li6 censee organized as an unincorporated partnership,

7 but does not include any funds—

8 (A) borrowed by the licensee from any

9 source;

10 (B) obtained from the sale of preferred secu11 rities; or

12 (C) derived directly or indirectly from any

13 Federal source;

14 (10) the term ‘‘qualified business concern’’ means

15 a United States company described in section

16 28(d)(9)(B) of the National Institute Standards and

17 Technology Act (15 U.S.C. 278n(d)(9)(B)), if—

18 (A) the business of such company includes

19 the pursuit, under the Small Business Innova20 tion Research (SBIR) program, of applications

21 described in section 9(e)(4)(C) of the Small Busi22 ness Act (15 U.S.C. 638(e)(4)(C));

23 (B) the principal business of such company

24 is the development or application of a critical

25 technology;
65

•HR 820 RH

1 (C) such company is eligible for assistance

2 under the Advanced Technology Program (ATP)

3 established under section 28 of the National In4 stitute of Standards and Technology Act (15

5 U.S.C. 278n); or

6 (D) such company is principally engaged in

7 the development or exploitation of inventions,

8 technological improvements, new processes, or

9 products not previously generally available

10 (within the meaning of section 851(e)(1) of the

11 Internal Revenue Code of 1986);

12 (11) the term ‘‘State’’ means several States, the

13 District of Columbia, the Commonwealth of Puerto

14 Rico, the Virgin Islands, Guam, American Samoa,

15 and the Commonwealth of the Northern Mariana Is16 lands, and any other territory or possession of the

17 United States;

18 (12) the term ‘‘State sponsored licensee’’ means

19 a company licensed under section 345 in which a

20 State or instrumentality of a State has at least a 25

21 percent investment interest in the private equity cap22 ital of such licensee;

23 (13) the term ‘‘university sponsored licensee’’

24 means a company licensed under section 345 in

25 which a single university or consortium of univer-
66

•HR 820 RH

1 sities has at least a 25 percent investment interest in

2 the private equity capital of such licensee; and

3 (14) the term ‘‘venture capital’’ means consider4 ation for such—

5 (A) common stock;

6 (B) preferred stock;

7 (C) debt with equity features which may in8 clude equity warrants or rights to convert into

9 common stock and which provides for interest

10 payments contingent upon and limited to the ex11 tent of earnings; or

12 (D) other financing,

13 as the Under Secretary determines to be substantially

14 similar to equity financing, issued by a qualified

15 business concern.

16 SEC. 343. ESTABLISHMENT AND PURPOSE.

17 (a) ESTABLISHMENT.—There is established within the

18 Technology Administration of the Department of Commerce

19 a national program to stimulate and supplement the avail20 ability of long-term investment capital for the formation,

21 development, and growth of qualified business concerns

22 throughout the United States. The Secretary, through the

23 Under Secretary, shall, through such program, provide for

24 the selection, licensing, monitoring, and financial and tech25 nical support of professionally managed technology invest-
67

•HR 820 RH

1 ment companies which in turn shall provide financial,

2 management, and technical assistance to qualified business

3 concerns, with preference given to satisfying the seed and

4 early-stage financing needs of such concerns that are not

5 being met by other sources on reasonable terms.

6 (b) PURPOSES.—The purposes of this subtitle are—

7 (1) to contribute to United States economic com8 petitiveness, employment, and prosperity;

9 (2) to promote the advancement, maturation,

10 and application of critical and other advanced tech11 nologies;

12 (3) to supplement and stimulate long-term in13 vestment in qualified business concerns; and

14 (4) to encourage and facilitate the formation and

15 growth of professionally managed technology invest16 ment companies throughout the United States that

17 will give preference to satisfying the capital needs of

18 qualified business concerns, especially during their

19 early stages of development.

20 (c) RESPONSIBILITIES.—(1) In carrying out this sub21 title, the Secretary, acting through the Under Secretary,

22 and subject to the availability of appropriations, shall—

23 (A) consult with and, to the extent permitted by

24 law, utilize the capabilities of other executive agen-
68

•HR 820 RH

1 cies, as appropriate, to ensure the efficient and effec2 tive implementation of this subtitle;

3 (B) explore, with other executive agencies, ways

4 to avoid duplication of effort by consolidating the ad5 ministration of the program established by this sub6 title with any other similar Federal program, and as

7 part of such consolidation may delegate administra8 tive functions, as necessary and appropriate, to an9 other executive agency; and

10 (C) consult with the Secretary of Energy on all

11 policy matters related to the Civilian Technology De12 velopment Program that deal with development or

13 utilization of energy technologies.

14 (2) To the extent permitted by law, other executive

15 agencies shall cooperate with the Under Secretary in carry16 ing out this subtitle.

17 (d) OPERATING PLAN.—The Secretary, acting through

18 the Under Secretary, shall prepare (in consultation with

19 the Advisory Committee established under section 344, other

20 appropriate executive agencies, the States, United States

21 companies, the financial community, and other appropriate

22 parties) and submit to the Congress on or about November

23 1, 1993, an operating plan to carry out this subtitle. In

24 preparing such plan, the Secretary shall consider and

25 evaluate alternative approaches to achieving the purposes
69

•HR 820 RH

1 of this subtitle and shall develop recommendations, as ap2 propriate, to fulfill the purposes of this subtitle in the most

3 effective and efficient manner achievable. Such evaluations

4 and recommendations shall be included in the plan submit5 ted under this subsection.

6 (e) OUTREACH TO ECONOMICALLY DEPRESSED

7 AREAS.—The Secretary, acting through the Under Sec8 retary, shall seek to ensure that qualified business concerns

9 located in areas determined by the Secretary to have a de10 pressed economy, or a significant concentration of defense11 related industries, or chronically high unemployment, are

12 notified of the availability of financial assistance through

13 the program established under this subtitle and, to the ex14 tent practicable, to encourage and facilitate the participa15 tion of such qualified business concerns in such program.

16 (f) EFFECTIVE DATE.—Except as provided in sub17 section (d) and in sections 344 and 351(a), the provisions

18 of this subtitle shall take effect on October 1, 1994.

19 SEC. 344. ADVISORY COMMITTEE.

20 (a) ESTABLISHMENT.—There is established a Civilian

21 Technology Development Advisory Committee (in this sec22 tion referred to as the ‘‘CTD Advisory Committee’’).

23 (b) COMPOSITION.—The CTD Advisory Committee

24 shall be composed of 7 members, appointed by the Under

25 Secretary from among private individuals who, because of
70

•HR 820 RH

1 their experience and accomplishments in technology devel2 opment, maturation, and adoption, business development,

3 venture capital, finance, or other relevant areas, are excep4 tionally qualified to perform the duties of the CTD Advisory

5 Committee. The Under Secretary shall designate 1 member

6 to serve as chairman.

7 (c) DUTIES.—The duties of the CTD Advisory Com8 mittee shall include advising the Under Secretary on all

9 matters related to policy, planning, execution, and evalua10 tion of the program established under this subtitle.

11 (d) TERMINATION.—Section 14 of the Federal Advisory

12 Committee Act shall not apply to the CTD Advisory Com13 mittee.

14 SEC. 345. ORGANIZATION AND LICENSING.

15 (a) IN GENERAL.—Any incorporated body, limited

16 partnership, or State instrumentality organized and char17 tered or otherwise existing under State law for the purpose

18 of performing the functions and conducting the activities

19 contemplated under this subtitle, that possesses the powers,

20 capabilities, and expertise reasonably necessary to perform

21 such functions and conduct such activities, may apply for

22 a license under this subtitle in such form and manner as

23 the Under Secretary may prescribe.

24 (b) ARTICLES.—The articles of any applicant shall

25 specify in general terms the objects for which the applicant
71

•HR 820 RH

1 is formed, the name assumed by such applicant, the area

2 or areas in which its operations are to be carried on, the

3 place where its principal office is to be located, and the

4 amount and classes of its shares of capital stock. Such arti5 cles may contain any other provisions not inconsistent with

6 this subtitle that the applicant may see fit to adopt for the

7 regulation of its business and the conduct of its affairs.

8 Such articles and any amendments thereto adopted from

9 time to time shall be subject to the approval of the Under

10 Secretary.

11 (c) BUSINESS PLAN.—The business plan of any appli12 cant shall specify in general terms—

13 (1) how the applicant proposes to achieve the ob14 jects for which it is formed, to operate and govern its

15 business, and to fulfill the purposes and satisfy the re16 quirements of this subtitle;

17 (2) the board members or general partners and

18 the management and professional staff of the appli19 cant, and the professional training, experience, rep20 utation, and investment performance record, if any,

21 of each such individual, along with a description of

22 the applicant’s current and proposed management

23 structure;

24 (3) all current or committed private investors in

25 the applicant, together with the amount, terms, condi-
72

•HR 820 RH

1 tions, and conveyances associated with such invest2 ment, and appropriate background information on

3 each private investor; and

4 (4) such other information as the Under Sec5 retary may require.

6 Such business plan and any material amendments thereto

7 adopted from time to time shall be subject to the approval

8 of the Under Secretary.

9 (d) APPROVAL OF ARTICLES AND BUSINESS PLAN; LI10 CENSING.—The articles and business plan of an applicant

11 for a license shall be forwarded to the Under Secretary for

12 consideration and approval or disapproval. In determining

13 whether to approve a prospective licensee’s articles and

14 business plan and permit it to operate under the provisions

15 of this subtitle, the Under Secretary shall give due regard,

16 among other things, to the general business reputation,

17 character, suitability, and demonstrated ability, experience,

18 and performance in the development, growth, and financing

19 of qualified business concerns, of the proposed owners and

20 management of the prospective licensee, and the likelihood

21 of successful operations of the prospective licensee including

22 adequate profitability and financial soundness. After con23 sideration of all relevant factors, if the Under Secretary ap24 proves the company’s articles and business plan and deter25 mines that the applicant satisfies or will satisfy the require-
73

•HR 820 RH

1 ments of this subtitle, the Under Secretary may approve

2 the company to operate under the provisions of this subtitle

3 and issue the company a license for such operation.

4 SEC. 346. CAPITAL AND MANAGEMENT REQUIREMENTS.

5 (a) CAPITAL.—(1) The private equity capital of a li6 censee shall be adequate to ensure a reasonable prospect that

7 the licensee will be operated soundly and profitably, and

8 managed actively and prudently in accordance with its ar9 ticles and business plan. Such private equity capital shall

10 not be less than $5,000,000, except that, in the case of a

11 State sponsored licensee or a university sponsored licensee,

12 such private equity capital shall not be less than

13 $2,500,000. At the time of issuance of a license, not less

14 than 75 percent of the private equity capital of the licensee

15 shall be available or committed to be available for new in16 vestment in accordance with this subtitle.

17 (2) Private and public pension funds may contribute

18 to the private equity capital of a licensee without restriction

19 as to the amount of such contribution.

20 (3) State and local government entities may contribute

21 not more than 40 percent of the total private equity capital

22 of a licensee.

23 (4) The aggregate amount of shares in any such li24 censee or licensees which may be owned or controlled by any
74

•HR 820 RH

1 stockholder, or by any group or class of stockholders, may

2 be limited by the Under Secretary.

3 (b) MANAGEMENT.—The management and operational

4 control of a licensee shall be carried out by suitable private

5 individuals who possess the professional training, experi6 ence, and capabilities reasonably necessary to achieve the

7 purposes of this subtitle.

8 SEC. 347. FINANCING FOR LICENSEES.

9 (a) AUTHORITY TO PURCHASE AND GUARANTEE PRE10 FERRED SECURITIES.—To encourage and facilitate the for11 mation and growth of licensees and qualified business con12 cerns, the Under Secretary may purchase or commit to pur13 chase nonvoting preferred securities, with or without equity

14 warrants, issued by a licensee, or guarantee, or commit to

15 guarantee, the payment of 100 percent of the redemption

16 price of and dividends on such preferred securities, to the

17 extent provided in appropriations Acts, if the licensee has

18 demonstrated to the satisfaction of the Under Secretary that

19 it is financially sound and that it has complied with or

20 will comply with the requirements of this subtitle, the terms

21 of its license, and any rule, regulation, or order issued

22 under this subtitle. Such purchases and guarantees shall

23 constitute direct loans and loan guarantees within the

24 meaning of paragraphs (1) and (3) of section 502 of the

25 Federal Credit Reform Act of 1990, respectively. A trust or
75

•HR 820 RH

1 pool acting on behalf of the Under Secretary may purchase

2 preferred securities that are guaranteed under this sub3 section.

4 (b) TERMS AND CONDITIONS OF PREFERRED SECURI5 TIES.—(1) Guarantees and purchases of preferred securi6 ties, or commitments to make such guarantees and pur7 chases, under this section may be made on such terms and

8 conditions as the Under Secretary shall establish by regula9 tion or set forth in contract to ensure compliance with this

10 subtitle and to protect the interests of taxpayers and the

11 United States in the event of default or otherwise. For pur12 poses of this paragraph, the Under Secretary shall by regu13 lation define the term ‘‘default’’.

14 (2)(A) Except as provided in subparagraph (B), pre15 ferred securities issued under this section shall be senior in

16 priority for all purposes to all non-Federal equity interests

17 in a licensee unless the Under Secretary, in the exercise of

18 reasonable investment prudence and in considering the fi19 nancial soundness of the licensee, determines otherwise.

20 (B) The equity interests of a university or consortium

21 of universities, or of a State or instrumentality of a State,

22 in a licensee shall be equal in priority to Federal equity

23 interests in such licensee for all purposes unless the Under

24 Secretary, in the exercise of reasonable investment prudence
76

•HR 820 RH

1 and in considering the financial soundness of the licensee,

2 determines otherwise.

3 (3) Preferred securities issued under this section shall

4 be redeemed by the issuer not later than 10 years after their

5 date of issuance for an amount equal to 100 percent of the

6 original issue price plus any accrued and unpaid divi7 dends. In order to facilitate the orderly liquidation of a li8 censee’s investments, redemption of such preferred securities

9 may be extended by mutual consent for no more than 5

10 years beyond such expiration date.

11 (4) Preferred securities issued under this section shall

12 pay dividends at a rate determined by the Secretary of the

13 Treasury at the time of issuance to equal the then current

14 average market yield on outstanding marketable debt obli15 gations of the United States with remaining periods to ma16 turity comparable to the time to required redemption of

17 such preferred securities, plus such additional charge, if

18 any, toward covering expected defaults and reasonable ad19 ministrative costs of carrying out this subtitle as the Under

20 Secretary may determine to be reasonable and appropriate.

21 Such additional charge shall not exceed 2 percent.

22 (5) Dividends on preferred securities issued under this

23 section shall be cumulative and preferred and paid out of

24 net realized earnings and returns of capital available for
77

•HR 820 RH

1 distribution, as defined by the Under Secretary by regula2 tion.

3 (6) The payment of dividends on preferred securities

4 issued under this section may be deferred by the issuer until

5 such time as, and to the extent that, the issuer realizes earn6 ings and returns of capital available for distribution. Accu7 mulated and unpaid dividends on such preferred securities

8 shall be paid by the issuer before or at the time of redemp9 tion of the preferred securities and before any distribution

10 of net realized earnings and returns of capital of the issuer

11 to its non-Federal equity investors, except as provided in

12 subsection (e)(2) (B) and (C). With respect to preferred se13 curities issued under this section to a party other than the

14 Under Secretary, during the time of any deferral under this

15 paragraph, the Under Secretary shall make, on behalf of

16 the issuer, required dividend payments to the holder of the

17 preferred securities, its agents or assigns, or the appropriate

18 central registration agent, if any. The authority to make

19 dividend payments provided in this paragraph shall be lim20 ited to the extent of amounts provided in advance in appro21 priations Acts for such purposes.

22 (7) For purposes of this subsection, the term ‘‘divi23 dends’’ means dividends on preferred stock and returns on

24 preferred limited partnership interests or other similar se25 curities, as defined by the Under Secretary by regulation.
78

•HR 820 RH

1 (c) LIMITATIONS AND RESTRICTIONS.—(1) The total

2 principal amount of debt, as evidenced by notes, bonds, de3 bentures, or certificates of indebtedness, plus the total face

4 amount of preferred securities purchased or guaranteed by

5 the Under Secretary under subsection (a), issued and out6 standing from a licensee shall not exceed 200 percent of the

7 private equity capital of the licensee.

8 (2) The total face amount of preferred securities pur9 chased or guaranteed by the Under Secretary under sub10 section (a) and outstanding from a licensee or a combina11 tion of licensees which are commonly controlled, as defined

12 and determined by the Under Secretary, shall not exceed

13 $50,000,000.

14 (3)(A) If preferred securities issued under this section

15 are outstanding, then the issuing licensee shall be subject

16 to the following restrictions:

17 (i) The total principal amount of debt, as evi18 denced by notes, bonds, debentures, or certificates of

19 indebtedness, of a licensee issued and outstanding

20 may not exceed 50 percent of the private equity cap21 ital of the licensee.

22 (ii) The annual management expenses of a li23 censee shall not exceed an amount which the Under

24 Secretary determines to be reasonable and appro25 priate.
79

•HR 820 RH

1 (iii) The aggregate amount of obligations and se2 curities acquired and for which commitments may be

3 issued by a licensee for any single qualified business

4 concern shall not exceed $2,000,000 or 20 percent of

5 the private equity capital of such licensee, whichever

6 is greater, unless the Under Secretary approves a

7 greater amount.

8 (B) For purposes of this paragraph, the term ‘‘man9 agement expenses’’ includes expenses incurred in the normal

10 course of operations, but shall not include the cost of legal,

11 accounting, and consulting services provided by outside

12 parties and by affiliates of the licensee which are not nor13 mal practice in making and monitoring investments con14 sistent with the purposes of this subtitle.

15 (d) USE OF CAPITAL BY LICENSEES.—(1) A licensee

16 issuing preferred securities under this section shall invest

17 or commit to invest—

18 (A) an amount equal to the face value of such

19 preferred securities that are outstanding; plus

20 (B) an amount of its private equity capital

21 equal to 50 percent of the amount described in sub22 paragraph (A),

23 in the venture capital of qualified business concerns in ac24 cordance with section 349.
80

•HR 820 RH

1 (2) At least 50 percent of the amount of investments

2 required under paragraph (1) shall be for seed and early

3 stage financing, as defined by the Under Secretary by regu4 lation. The Under Secretary may alter the percentage re5 quirement under this paragraph to the extent necessary, in

6 the determination of the Under Secretary, to achieve the

7 purposes of this subtitle and maintain prudent investment

8 diversification.

9 (3) Proceeds to a licensee derived from preferred securi10 ties issued under this section may be used by the issuer to

11 redeem any preferred securities issued under this section

12 that have been outstanding at least 5 years, as provided

13 in subsection (b)(3).

14 (4) Proceeds to a licensee derived from preferred securi15 ties issued under this section that have not been invested

16 pursuant to paragraphs (1) and (2) or used for redemptions

17 pursuant to paragraph (3) and are not reasonably needed

18 for the operations of the licensee shall be invested in direct

19 obligations of, or obligations guaranteed as to principal and

20 interest by, the United States, or in certificates of deposit

21 maturing within one year or less, issued by any institution

22 the accounts of which are insured by the Federal Deposit

23 Insurance Corporation.

24 (e) PROFIT DISTRIBUTION BY LICENSEES.—(1) Any

25 distribution of net realized earnings and returns of capital
81

•HR 820 RH

1 made by a licensee that exceeds amounts required for the

2 purposes stated in paragraph (2) shall be distributed pro

3 rata to all investors entitled to such distributions. The Unit4 ed States shall receive no funds under this paragraph.

5 (2)(A) Except as provided in subparagraphs (B) and

6 (C), any distribution of net realized earnings and returns

7 of capital made by a licensee shall first be used to pay accu8 mulated and unpaid dividends owed on outstanding pre9 ferred securities issued under this section and to satisfy the

10 redemption requirements of subsection (b)(3).

11 (B) For purposes of subparagraph (A), the redemption

12 requirements of subsection (b)(3) shall be considered to be

13 satisfied if necessary and appropriate actions, as deter14 mined by the Under Secretary, have been undertaken by

15 the licensee to ensure that such requirements will be satis16 fied.

17 (C) If a licensee is operating as a limited partnership

18 or as a corporation described in subchapter S of chapter

19 1 of subtitle A of the Internal Revenue Code of 1986 or an

20 equivalent pass-through entity for tax purposes, it may dis21 tribute to the partners or shareholders an amount equal to

22 the estimated amount of Federal, State, and local income

23 taxes due from such partners and shareholders on their

24 share of undistributed taxable income for the current tax-
82

•HR 820 RH

1 able year before payments described in subparagraph (A)

2 are made.

3 (f) USE OF PAYMENTS TO THE UNITED STATES.—

4 Amounts received by the United States from the payment

5 of dividends and the redemption of preferred securities pur6 suant to this section, and fees paid to the United States

7 by a licensee pursuant to this subtitle, shall be deposited

8 in an account established by the Under Secretary and shall

9 be available solely for carrying out this subtitle, to the ex10 tent provided in advance in appropriations Acts.

11 SEC. 348. ISSUANCE AND GUARANTEE OF TRUST CERTIFI12 CATES.

13 (a) AUTHORITY TO ISSUE TRUST CERTIFICATES.—

14 The Under Secretary is authorized to issue trust certificates

15 representing ownership of all or a fractional part of pre16 ferred securities issued by licensees and guaranteed by the

17 Under Secretary under this subtitle. Such trust certificates

18 shall be based on and backed by a trust or pool approved

19 by the Under Secretary and composed of preferred securities

20 and such other contractual obligations as the Under Sec21 retary may undertake to facilitate the sale of such trust

22 certificates.

23 (b) GUARANTEE OF TRUST CERTIFICATES.—The

24 Under Secretary is authorized, upon such terms and condi25 tions as are deemed appropriate, to guarantee the timely
83

•HR 820 RH

1 payment of the principal of and interest on trust certifi2 cates issued by the Under Secretary or his agent for pur3 poses of this section. Such guarantee shall be limited to the

4 extent of the redemption price of and dividends on the pre5 ferred securities, plus any related contractual obligations,

6 which compose the trust or pool.

7 (c) PREPAYMENTS AND REDEMPTIONS.—In the event

8 that preferred securities or contractual obligations in such

9 trust or pool are redeemed or extinguished, either volun10 tarily or involuntarily, the guarantee of timely payment

11 of principal and interest on the trust certificates shall be

12 reduced in proportion to the amount of redemption price

13 and dividends such redeemed preferred security or extin14 guished contractual obligation represents in the trust or

15 pool. Dividends or partnership profit distributions on such

16 preferred securities and related contractual obligations,

17 shall accrue and be guaranteed by the Under Secretary only

18 through the date of payment on the guarantee. During the

19 term of the trust certificate, it may be called for redemption,

20 whether voluntary or involuntary, of all preferred securities

21 residing in the pool.

22 (d) FEES.—The Under Secretary may collect fees for

23 a guarantee under this section that are reasonable and

24 customary.
84

•HR 820 RH

1 (e) PAYMENT OF CLAIMS.—(1) In the event the Under

2 Secretary pays a claim under a guarantee issued under this

3 section, it shall be subrogated fully to the rights satisfied

4 by such payment.

5 (2) No State or local law, and no Federal law, shall

6 preclude or limit the exercise by the Under Secretary of

7 ownership rights in the preferred securities residing in a

8 trust or pool against which trust certificates are issued.

9 (f) REGISTRATION AND INTERMEDIARY OPER10 ATIONS.—(1) The Under Secretary shall provide for a

11 central registration of all trust certificates sold pursuant

12 to this section. Such central registration shall include with

13 respect to each sale, identification of each licensee, the inter14 est rate or dividend rate paid by the licensee, commissions,

15 fees, or discounts paid to brokers and dealers in trust cer16 tificates, identification of each purchaser of the trust certifi17 cate, the price paid by the purchaser for the trust certificate,

18 the interest rate paid on the trust certificate, the fees of any

19 agent for carrying out the functions described in paragraph

20 (2), and such other information as the Under Secretary

21 deems appropriate.

22 (2) The Under Secretary shall contract with an agent

23 or agents to carry out on behalf of the Under Secretary the

24 pooling and the central registration functions of this section

25 including, notwithstanding any other provision of law,
85

•HR 820 RH

1 maintenance on behalf of and under the direction of the

2 Under Secretary, such commercial bank accounts as may

3 be necessary to facilitate trusts or pools backed by securities

4 guaranteed or purchased under this subtitle, and the issu5 ance of trust certificates to facilitate such poolings. Such

6 agent or agents shall provide a fidelity bond or insurance

7 in such amounts as the Under Secretary determines to be

8 necessary to fully protect the interests of the Federal Gov9 ernment.

10 (3) Prior to any sale, the Under Secretary shall require

11 the seller to disclose to a purchaser of a trust certificate

12 issued pursuant to this section, information on the terms,

13 conditions, and yield of such instrument.

14 SEC. 349. VENTURE CAPITAL FOR QUALIFIED BUSINESS

15 CONCERNS.

16 Each licensee may provide venture capital to qualified

17 business concerns, in such manner and under such terms

18 as the licensee may fix in accordance with the regulations

19 of the Under Secretary.

20 SEC. 350. OPERATION.

21 (a) COOPERATION.—Wherever practicable the oper22 ations of a licensee, including the generation of business,

23 may be undertaken in cooperation with banks or other li24 censees, investors, or lenders, incorporated or unincor25 porated, and any servicing or initial investigation required
86

•HR 820 RH

1 for loans or acquisitions of securities by the licensee under

2 the provisions of this subtitle may be handled through such

3 banks or other licensees, investors, or lenders on a fee basis.

4 Any licensee may receive fees for services rendered to such

5 banks and other licensees, investors, and lenders.

6 (b) ADVISORY SERVICES.—Each licensee may make

7 use, wherever practicable, of the advisory services of the

8 Federal Reserve System and of the Department of Com9 merce which are available for and useful to industrial and

10 commercial businesses, and may provide consulting and ad11 visory services on a fee basis and have on its staff persons

12 competent to provide such services. A licensee may not

13 charge fees for such services that are provided to a qualified

14 business concern in which it has an investment.

15 SEC. 351. REGULATIONS; LIABILITY.

16 (a) REGULATIONS.—The Under Secretary is author17 ized to prescribe regulations governing the operations of li18 censees, and to carry out the provisions of this subtitle, in

19 accordance with the purposes of this subtitle.

20 (b) LIABILITY OF THE UNITED STATES.—Nothing in

21 this subtitle or in any other provision of law imposes any

22 liability on the United States with respect to any obliga23 tions entered into, or stocks issued, or commitments made,

24 by any licensee operating under the provisions of this

25 subtitle.
87

•HR 820 RH

1 SEC. 352. TECHNICAL ASSISTANCE FOR LICENSEES AND

2 QUALIFIED BUSINESS CONCERNS.

3 (a) TECHNICAL ASSISTANCE.—The Secretary shall,

4 upon request, provide technical assistance and services, as

5 appropriate and needed, to licensees and to qualified busi6 ness concerns receiving financial assistance under this sub7 title, and shall ensure that such qualified business concerns

8 have ready access to appropriate assistance available under

9 title III of the Stevenson-Wydler Technology Innovation Act

10 of 1980, or under any other Act, in order to aid such quali11 fied business concerns in their development or utilization

12 of critical or other advanced technologies. Technical assist13 ance and services under this subsection shall include provid14 ing licensees and qualified business concerns with—

15 (1) an assessment of the technological and sci16 entific feasibility of a project, or an analysis of a spe17 cific field of technical or scientific endeavor;

18 (2) improved access to technology developed by

19 the Institute and assistance in obtaining access to

20 technology developed by other Federal agencies and

21 laboratories;

22 (3) expert analysis of the economics of technology

23 development undertaken by a qualified business con24 cern; and

25 (4) any other assistance or service that the

26 Under Secretary determines, after consultation with
88

•HR 820 RH

1 licensees and qualified business concerns, is necessary

2 and appropriate to enhance prospects for success and

3 to reduce technical risk for licensees and qualified

4 business concerns.

5 (b) FEES.—The Secretary may charge fees for services

6 and technical assistance provided under subsection (a) in

7 amounts sufficient to cover the reasonable cost of such serv8 ices and assistance. The Secretary may waive fees estab9 lished under this subsection.

10 SEC. 353. PERFORMANCE MEASURES; ANNUAL REPORT.

11 (a) PERFORMANCE MEASURES.—The performance of

12 the program established under this subtitle shall be evalu13 ated relative to progress made in achieving its purposes and

14 shall be measured in relevant and meaningful terms such

15 as significant accomplishments in advancing technology,

16 businesses formed and financed, jobs created, taxes gen17 erated, licenses granted and maintained, capital invested,

18 and other criteria the Under Secretary may deem appro19 priate.

20 (b) ANNUAL REPORT.—The Under Secretary shall pre21 pare, in consultation with the advisory committee estab22 lished under section 344, and submit annually a report to

23 the Congress containing a full and detailed account of oper24 ations under this subtitle. Such report shall include—
89

•HR 820 RH

1 (1) an assessment of progress made in achieving

2 the purposes of this subtitle;

3 (2) performance measures established under sub4 section (a);

5 (3) a list of licensees along with their location,

6 area of operations, investment objectives, capitaliza7 tion, and net asset value, both at cost and at current

8 fair market value;

9 (4) an audit setting forth the amount, type, re10 cipient, and source of disbursements, receipts, and

11 losses sustained by the Federal Government as a re12 sult of operations under this subtitle during the pre13 ceding fiscal year and since inception of the program;

14 (5) the Under Secretary’s plans to ensure the

15 provision of licensee financing to all areas of the

16 country and to all qualified business concerns, and

17 plans to notify and to encourage and facilitate the

18 participation of qualified business concerns as re19 quired by section 343(e), including steps taken to ac20 complish those goals;

21 (6) steps taken by the Under Secretary to carry

22 out this subtitle and to ensure compliance with statu23 tory and regulatory standards relating thereto; and

24 (7) recommendations with respect to program

25 changes, statutory changes, and other matters, includ-
90

•HR 820 RH

1 ing tax incentives, to improve and facilitate the oper2 ations of licensees and to encourage the use of their

3 financing facilities by qualified business concerns.

4 SEC. 354. REPORTS, INVESTIGATIONS, AND EXAMINATIONS.

5 (a) REPORTING REQUIREMENTS.—Each license issued

6 under this subtitle shall require a licensee with outstanding

7 preferred securities to provide the Under Secretary such in8 formation, including companies financed, disbursements

9 made along with associated terms and conditions, receipts,

10 portfolio valuation and net asset value at cost and at esti11 mated fair market value, and other financial statements,

12 that the Under Secretary may require to satisfy the require13 ments of section 353(b) and to determine, in a timely man14 ner, compliance with this subtitle and regulations promul15 gated under this subtitle. Such reporting shall be—

16 (1) except as otherwise provided in this sub17 section, consistent with the reporting practices and

18 standards of the venture capital industry;

19 (2) uniform for all licensees;

20 (3) submitted annually to the Under Secretary,

21 with valuation and other information provided more

22 frequently as the Under Secretary may require; and

23 (4) certified by the Board of Directors or the

24 General Partners of the licensee.
91

•HR 820 RH

1 The Under Secretary may exempt from making such reports

2 any licensee which is registered under the Investment Com3 pany Act of 1940 only to the extent necessary to avoid du4 plication in reporting requirements.

5 (b) VALUATIONS.—The Under Secretary shall, by regu6 lation, establish guidelines for estimating the fair market

7 value of investments held by a licensee as required under

8 subsection (a). The board of directors of a corporate licensee

9 and the general partners of a partnership licensee shall have

10 the sole responsibility for making a good faith determina11 tion of the fair market value of investments held by such

12 licensee, based on guidelines established under this sub13 section.

14 (c) INVESTIGATIONS.—The Secretary may undertake

15 investigations to determine whether a licensee or any other

16 person has engaged or is about to engage in any acts or

17 practices which constitute or will constitute a violation of

18 any provision of this subtitle, or of any rule, regulation,

19 or order issued under this subtitle. The Secretary shall per20 mit any person to file a statement in writing, under oath

21 or otherwise as the Secretary shall determine, as to all the

22 facts and circumstances concerning the matter to be inves23 tigated. For the purpose of any investigation, the Secretary

24 is empowered to administer oaths and affirmations, sub25 poena witnesses, compel their attendance, take evidence,
92

•HR 820 RH

1 and require the production of any books, papers, and docu2 ments which are relevant to the inquiry.

3 (d) EXAMINATIONS.—Each licensee shall be subject to

4 examinations made at the discretion and direction of the

5 Under Secretary by examiners selected or approved by, and

6 under the supervision of, the Under Secretary. The Under

7 Secretary may enter into contracts with private parties to

8 perform such examinations. The cost of such examinations,

9 including the compensation of the examiners, may in the

10 discretion of the Under Secretary be assessed against the

11 licensee examined and when so assessed shall be paid by

12 such licensee.

13 SEC. 355. REVOCATION AND SUSPENSION OF LICENSES;

14 CEASE AND DESIST ORDERS.

15 (a) GROUNDS FOR REVOCATION OR SUSPENSION.—A

16 license may be revoked or suspended by the Secretary—

17 (1) for willful or repeated violation of any provi18 sion of this subtitle or any rule, regulation, or order

19 issued thereunder; or

20 (2) if the licensee no longer serves the purposes

21 for which it was granted a license.

22 (b) CEASE AND DESIST ORDERS.—Where a licensee or

23 any other person has not complied with any provision of

24 this subtitle, or of any rule, regulation, or order issued

25 thereunder, or is engaging or is about to engage in any acts
93

•HR 820 RH

1 or practices which constitute or will constitute a violation

2 of such provision, rule, regulation, or order, the Secretary

3 may order such licensee or other person to cease and desist

4 from such action or failure to act. The Secretary may fur5 ther order such licensee or other person to take such action

6 or to refrain from such action as the Secretary considers

7 necessary to ensure compliance with such provisions, rules,

8 regulations, or orders. The Secretary may also suspend the

9 license of a licensee, against whom an order has been issued,

10 until such licensee complies with such order.

11 (c) SUBPOENAS.—The Secretary may require by sub12 poenas the attendance and testimony of witnesses and the

13 production of all books, papers, and documents relating to

14 the hearing from any place in the United States.

15 (d) ENFORCEMENT.—If any licensee or other person

16 against which or against whom an order is issued under

17 this section fails to obey the order, the Secretary may apply

18 to the district court of the United States for the district

19 where the licensee has its principal place of business, for

20 the enforcement of the order.

21 SEC. 356. INJUNCTIVE RELIEF.

22 (a) IN GENERAL.—If the Secretary determines that a

23 licensee or any other person has engaged, or is about to en24 gage, in any acts or practices which constitute a violation

25 of any provision of this subtitle, or of any rule, regulation,
94

•HR 820 RH

1 or order issued under this subtitle, the Secretary may apply

2 to the appropriate district court of the United States for

3 injunctive relief.

4 (b) RECEIVERSHIP.—Whenever it is necessary in order

5 to achieve the purposes of injunctive relief granted under

6 subsection (a), and upon proper application by the Sec7 retary, the court may order the attachment of assets of a

8 licensee and may appoint a receiver to administer such as9 sets under the direction of the court.

10 SEC. 357. CONFLICTS OF INTEREST.

11 For the purpose of controlling conflicts of interest

12 which may be detrimental to qualified business concerns,

13 to licensees, to the shareholders or partners of either, or to

14 the purposes of this subtitle, the Under Secretary shall

15 adopt regulations to govern transactions with any officer,

16 director, shareholder, or partner of any licensee, or with

17 any person or concern, in which any interest, direct or in18 direct, financial or otherwise, is held by any officer, direc19 tor, shareholder, or partner of (1) any licensee, or (2) any

20 person or concern with an interest, direct or indirect, finan21 cial or otherwise, in any licensee. Such regulations shall

22 include appropriate requirements for public disclosure (in23 cluding disclosure in the locality most directly affected by

24 the transaction) necessary to the purposes of this section.
95

•HR 820 RH

1 SEC. 358. REMOVAL OR SUSPENSION OF DIRECTORS AND

2 OFFICERS.

3 (a) GROUNDS.—The Secretary, after an opportunity

4 for agency hearing, may serve upon any director or officer

5 of a licensee a written notice of its intention to remove such

6 director or officer from office, temporarily or permanently,

7 whenever in the opinion of the Secretary such director or

8 officer—

9 (1) has willfully and knowingly—

10 (A) committed any substantial violation of

11 this subtitle or any rule, regulation, or order is12 sued under this subtitle; or

13 (B) committed or engaged in any act, omis14 sion, or practice which constitutes a substantial

15 breach of his fiduciary duty as such director or

16 officer,

17 and that such violation or such breach of fiduciary

18 duty is one involving personal dishonesty on the part

19 of such director or officer; or

20 (2) has been convicted of a felony involving dis21 honesty or breach of trust.

22 (b) HEARING.—A hearing under this section shall be

23 on the record and shall be held in the Federal judicial dis24 trict or in the territory in which the principal office of the

25 licensee is located unless the party afforded the hearing con26 sents to another place. A hearing under this section shall
96

•HR 820 RH

1 be fixed for a date not earlier than 30 days nor later than

2 60 days after the date of service of such notice, unless an

3 earlier or a later date is set by the Secretary at the request

4 of (1) such director or officer and for good cause shown,

5 or (2) the Attorney General of the United States. Unless

6 such director or officer shall appear at the hearing in per7 son or by a duly authorized representative, he shall be

8 deemed to have consented to the issuance of an order of such

9 removal.

10 SEC. 359. VIOLATIONS.

11 (a) PARTICIPATION.—Whenever a licensee commits a

12 violation of this subtitle, or any rule, regulation, or order

13 issued under this subtitle, such violation shall be deemed

14 to be also a violation on the part of any person who, directly

15 or indirectly, authorizes, orders, participates in, or causes,

16 brings about, counsels, aids, or abets in the commission of

17 such violation.

18 (b) BREACH OF FIDUCIARY DUTY.—It shall be a viola19 tion of this subtitle for any officer, director, employee,

20 agent, or other participant in the management or conduct

21 of the affairs of a licensee to engage in any act or practice,

22 or to omit any act, in breach of his fiduciary duty as such

23 officer, director, employee, agent, or participant, if, as a

24 result thereof, the licensee has suffered or is in imminent

25 danger of suffering financial loss or other damage.
97

•HR 820 RH

1 (c) DISQUALIFICATION.—Except with the written con2 sent of the Secretary, it shall be a violation of this subtitle

3 for any person to take office, or to continue to serve, as

4 an officer, director, or employee of a licensee, or to become

5 or continue to serve as an agent or participant in the con6 duct of the affairs or management of a licensee, if such per7 son—

8 (1) has been convicted of a felony, or any other

9 criminal offense involving dishonesty or breach of

10 trust; or

11 (2) has been found civilly liable in damages, or

12 has been permanently or temporarily enjoined by an

13 order, judgment, or decree of a court of competent ju14 risdiction, by reason of any act or practice involving

15 fraud or breach of trust.

16 SEC. 360. CIVIL PENALTIES.

17 Any person who is found by the Secretary, after notice

18 and opportunity to be heard on the record in accordance

19 with section 554 of title 5, United States Code, to have com20 mitted a violation of this subtitle or any rule, regulation,

21 or order issued under this subtitle shall be liable to the Unit22 ed States for a civil penalty of not more than $1,000 for

23 each violation. Each day of a continuing violation shall

24 constitute a separate violation. The amount of such civil

25 penalty shall be assessed by the Secretary by written notice.
98

•HR 820 RH

1 The Secretary may compromise, modify, or remit, with or

2 without conditions, any civil penalty which is subject to

3 imposition or which has been imposed under this section.

4 SEC. 361. ANTITRUST SAVINGS CLAUSE.

5 This subtitle shall not be construed to modify, impair,

6 or supersede the operation of the antitrust laws. For pur7 poses of this section, the term ‘‘antitrust laws’’ has the

8 meaning given it in subsection (a) of the first section of

9 the Clayton Act (15 U.S.C. 12(a)), except that such term

10 includes the Act of June 19, 1936 (49 Stat. 1526; 15 U.S.C.

11 13 et seq.), commonly known as the Robinson Patman Act,

12 and section 5 of the Federal Trade Commission Act (15

13 U.S.C. 45) to the extent that such section 5 applies to unfair

14 methods of competition.

15 TITLE IV—MISCELLANEOUS

16 SEC. 401. DEPARTMENT OF COMMERCE TECHNOLOGY ADVI17 SORY BOARD.

18 (a) ESTABLISHMENT.—There is established a Depart19 ment of Commerce Technology Advisory Board (in this sec20 tion referred to as the ‘‘Advisory Board’’) to assist the Tech21 nology Administration in the performance of its functions.

22 (b) COMPOSITION.—The Advisory Board shall be com23 posed of at least 17 members, appointed by the Under Sec24 retary from among individuals who, because of their experi25 ence and accomplishments are exceptionally qualified to
99

•HR 820 RH

1 provide advice to the Under Secretary on the plans, pro2 grams, and policy of the Technology Administration. The

3 Under Secretary shall make an effort to ensure the appoint4 ment of socially and economically disadvantaged individ5 uals (within the meaning of section 8(a)(5) and (6) of the

6 Small Business Act, and including women) to the Advisory

7 Board. The Under Secretary shall designate 1 member to

8 chair the Advisory Board. Membership of the Advisory

9 Board shall include representatives of—

10 (1) United States small businesses;

11 (2) other United States manufacturers;

12 (3) research universities and independent re13 search institutes;

14 (4) State and local government agencies involved

15 in technology extension;

16 (5) national laboratories;

17 (6) industrial, worker, and professional organi18 zations;

19 (7) financial organizations; and

20 (8) computing and communications equipment

21 and services providers.

22 (c) DUTIES.—The duties of the Advisory Board shall

23 include advising the Secretary, the Under Secretary, and

24 the Director regarding—
100

•HR 820 RH

1 (1) the development of policies and options for

2 implementation that the Advisory Board considers es3 sential to technology creation, development, and adop4 tion, including policies that would benefit small busi5 nesses;

6 (2) the development and rapid application of

7 critical and other advanced technologies, including

8 advanced manufacturing technologies;

9 (3) the development of computer and commu10 nications support services for advanced manufactur11 ing; and

12 (4) the planning, execution, and evaluation of

13 programs under the authority of the Technology Ad14 ministration.

15 (d) MEETINGS.—(1) The chairman shall call the first

16 meeting of the Advisory Board not later than 90 days after

17 the date of enactment of this Act.

18 (2) The Advisory Board shall meet at least once every

19 6 months, and at the call of the Under Secretary.

20 (e) TRAVEL EXPENSES.—Members of the Advisory

21 Board, other than full-time employees of the United States,

22 shall be allowed travel expenses in accordance with sub23 chapter I of chapter 57 of title 5, United States Code, while

24 engaged in the business of the Advisory Board.
101

•HR 820 RH

1 (f) CONSULTATION.—In carrying out this section, the

2 Under Secretary shall consult with other agencies, as ap3 propriate.

4 (g) TERMINATION.—Section 14 of the Federal Advisory

5 Committee Act shall not apply to the Advisory Board.

6 (h) SECRETARIAL DISCRETION.—Notwithstanding any

7 other provision of this section, the Secretary shall have the

8 discretion to decide whether to establish the Advisory Board

9 or create a more cost-effective way to achieve the goal of

10 closer cooperation with industry. If the Secretary exercises

11 such discretion and establishes an alternative mechanism,

12 the Under Secretary shall make an effort to ensure the par13 ticipation of socially and economically disadvantaged indi14 viduals (within the meaning of section 8(a)(5) and (6) of

15 the Small Business Act, and including women) in the alter16 native mechanism.

17 SEC. 402. INTERNATIONAL STANDARDIZATION.

18 (a) FINDINGS.—The Congress finds that—

19 (1) private sector consensus standards are essen20 tial to the timely development of competitive products;

21 (2) Federal Government contribution of resources

22 and more active participation in the voluntary stand23 ards process in the United States can increase the

24 quality of United States standards, increase their

25 compatibility with the standards of other countries,
102

•HR 820 RH

1 and ease access of products manufactured by United

2 States manufacturers to foreign markets; and

3 (3) the Federal Government, working in coopera4 tion with private sector organizations including trade

5 associations, engineering societies, and technical bod6 ies, can effectively promote United States Government

7 use of United States consensus standards and, where

8 appropriate, the adoption and United States Govern9 ment use of international standards.

10 (b) STANDARD PILOT PROGRAM.—Section 104(e) of

11 the American Technology Preeminence Act of 1991 is

12 amended—

13 (1) by inserting ‘‘(1)’’ before ‘‘Pursuant to the’’;

14 (2) by striking ‘‘matching funds’’ and inserting

15 in lieu thereof ‘‘financial contributions deemed appro16 priate by the Secretary’’; and

17 (3) by adding at the end the following new para18 graph:

19 ‘‘(2) As necessary and appropriate, the Institute shall

20 expand the program established under section 112 of the

21 National Institute of Standards and Technology Authoriza22 tion Act for Fiscal Year 1989 (15 U.S.C. 272 note) by ex23 tending the existing program to include other countries that

24 request assistance with standards-related activities from of25 ficial representatives of the United States Government. The
103

•HR 820 RH

1 Institute may enter into additional contracts with non-Fed2 eral organizations representing United States companies,

3 as such term is defined in section 28(d)(9)(B) of the Na4 tional Institute of Standards and Technology Act (15

5 U.S.C. 278n(d)(9)(B)) or with United States-based profes6 sional societies who participate in the development of stand7 ards. Such contracts shall require cost sharing between Fed8 eral and non-Federal sources for such purposes. In award9 ing such contracts, the Institute shall seek to promote and

10 support the dissemination of United States technical stand11 ards to additional foreign countries and shall seek, as the

12 Director deems appropriate, to promote the adoption of

13 international standards supported by United States indus14 try, and shall seek to assist private sector professional soci15 eties which participate in the development of standards in

16 expediting the development of domestic standards which en17 able the introduction of technologies, products, or tech18 nology-based services which are being delayed due to the

19 lack of available standards. The Institute and such contrac20 tors shall, in carrying out the preceding sentence, cooperate

21 with governmental bodies, private organizations including

22 standards setting organizations and industry, and multi23 national institutions that promote economic development.

24 The organizations receiving such contracts may establish

25 training programs to bring to the United States foreign
104

•HR 820 RH

1 standards experts for the purpose of receiving in-depth

2 training in the United States standards system.’’.

3 (c) REPORT ON STANDARDS.—(1) Section 508(a) of the

4 American Technology Preeminence Act of 1991 (15 U.S.C.

5 3701 note) is amended—

6 (A) by inserting ‘‘standards development and

7 international’’ after ‘‘a thorough review of inter8 national’’;

9 (B) by redesignating paragraphs (1) through (5)

10 as paragraphs (2) through (6), respectively; and

11 (C) by inserting before paragraph (2), as so re12 designated by subparagraph (B) of this paragraph,

13 the following new paragraph:

14 ‘‘(1) Current and potential future roles of the

15 Federal Government in the development and promul16 gation of domestic and global product and process

17 standards.’’.

18 (2) The Secretary, in consultation with the Institute

19 and the Department of Commerce Technology Advisory

20 Board established under section 401 of this Act and with,

21 as appropriate, the active participation of the private sec22 tor, shall submit to the Congress a report describing the ap23 propriate roles of the Department of Commerce in aid to

24 United States companies in achieving conformity assess25 ment and accreditation and otherwise qualifying their
105

•HR 820 RH

1 products in foreign markets, through the development and

2 promulgation of domestic and global product and quality

3 standards, and through the implementation of conformity

4 assessment and accreditation procedures based upon such

5 standards, including a discussion of the extent to which

6 each of the policy options provided in the March 1992 Office

7 of Technology Assessment report, entitled ‘‘Global Stand8 ards’’, contributes to meeting the goals of—

9 (A) increasing the international adoption of

10 standards beneficial to United States industries; and

11 (B) improving the coordination of United States

12 representation to international standards setting bod13 ies.

14 (3) The report shall also describe emerging product

15 and market areas which can be assisted by shortening the

16 time required for the development of standards and make

17 recommendations on contributions the Department of Com18 merce can make to improving the timeliness of standards

19 development.

20 SEC. 403. MALCOLM BALDRIGE AWARD AMENDMENTS.

21 (a) Section 108(c)(3) of the Stevenson-Wydler Tech22 nology Innovation Act of 1980, as so redesignated by section

23 206(b)(3) of this Act, is amended to read as follows:
106

•HR 820 RH

1 ‘‘(3) No award shall be made within any category or

2 subcategory if there are no qualifying enterprises in that

3 category or subcategory.’’.

4 (b)(1) Section 108(c)(1) of the Stevenson-Wydler Tech5 nology Innovation Act of 1980, as so redesignated by section

6 206(b)(3) of this Act, is amended by adding at the end the

7 following new subparagraph:

8 ‘‘(D) Educational institutions.’’.

9 (2)(A) Within 1 year after the date of enactment of

10 this Act, the Secretary shall submit to the Congress a report

11 containing—

12 (i) criteria for qualification for a Malcolm

13 Baldrige National Quality Award by various classes

14 of educational institutions;

15 (ii) criteria for the evaluation of applications for

16 such awards under section 108(d)(1) of the Stevenson17 Wydler Technology Innovation Act of 1980, as so re18 designated by section 206(b)(3) of this Act; and

19 (iii) a plan for funding awards described in

20 clause (i).

21 (B) In preparing the report required under subpara22 graph (A), the Secretary shall consult with the National

23 Science Foundation and other public and private entities

24 with appropriate expertise, and shall provide for public no25 tice and comment.
107

•HR 820 RH

1 (C) The Secretary shall not accept applications for

2 awards described in subparagraph (A)(i) until after the re3 port required under subparagraph (A) is submitted to the

4 Congress.

5 SEC. 404. COOPERATIVE RESEARCH AND DEVELOPMENT

6 AGREEMENTS.

7 Section 202 of the Stevenson-Wydler Technology Inno8 vation Act of 1980 (15 U.S.C. 3710a), as redesignated by

9 section 206(b)(5) of this Act, is amended—

10 (1) in subsection (d)(1), by inserting ‘‘(including

11 both real and personal property)’’ after ‘‘or other re12 sources’’ both places it appears; and

13 (2) in subsection (d)(2)(A), by inserting ‘‘includ14 ing Federal test and evaluation facilities,’’ after ‘‘by

15 a Federal agency,’’.

16 SEC. 405. COMPETITIVENESS ASSESSMENTS AND EVALUA17 TIONS.

18 Section 101(e) of the Stevenson-Wydler Technology In19 novation Act of 1980, as so redesignated by section

20 206(b)(2) of this Act, is amended to read as follows:

21 ‘‘(e) COMPETITIVENESS ASSESSMENTS AND EVALUA22 TIONS.—(1) The Secretary, through the Under Secretary,

23 shall—

24 ‘‘(A) provide for the conduct of research and

25 analyses to advance knowledge of the ways in which
108

•HR 820 RH

1 the economic competitiveness of United States compa2 nies can be enhanced through Federal programs estab3 lished under the National Competitiveness Act of 1993

4 or the amendments made by that Act; and

5 ‘‘(B) as appropriate, provide for evaluations of

6 Federal technology programs established or expanded

7 under the National Competitiveness Act of 1993 or the

8 amendments made by that Act in order to judge their

9 effectiveness and make recommendations to improve

10 their contribution to United States competitiveness.

11 ‘‘(2) All executive departments and agencies shall as12 sist the Secretary in carrying out this section as appro13 priate.

14 ‘‘(3) Nothing in this section shall authorize the release

15 of information to, or the use of information by, the Sec16 retary or Under Secretary in a manner inconsistent with

17 law or any procedure established pursuant thereto.

18 ‘‘(4) The head of any Federal agency may detail such

19 personnel and may provide such services, with or without

20 reimbursement, as the Secretary may request to assist in

21 carrying out the activities required under this section.’’.

22 SEC. 406. STUDY OF SEMICONDUCTOR LITHOGRAPHY TECH23 NOLOGIES.

24 Within 9 months after the date of enactment of this

25 Act, the Critical Technologies Institute (in this section re-
109

•HR 820 RH

1 ferred to as the ‘‘Institute’’) established under section 822

2 of the National Defense Authorization Act for Fiscal Year

3 1991 shall, after consultation with the private sector and

4 appropriate officials from other Federal agencies, submit to

5 Congress a report on advanced lithography technologies for

6 the production of semiconductor devices. The report shall

7 include the Institute’s evaluation of the likely technical and

8 economic advantages and disadvantages of each such tech9 nology, an analysis of current private and Government re10 search to develop each such technology, and any rec11 ommendations the Institute may have regarding future Fed12 eral support for research and development in advanced li13 thography.

14 SEC. 407. AMERICAN WORKFORCE QUALITY PARTNERSHIPS.

15 (a) AMENDMENT.—Title III of the Stevenson-Wydler

16 Technology Innovation Act of 1980, as added by title II

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

18 following new section:

19 ‘‘SEC. 305. AMERICAN WORKFORCE QUALITY PARTNER20 SHIPS.

21 ‘‘(a) PROGRAM AUTHORIZED.—The Secretary may

22 make grants to establish and operate American workforce

23 quality partnership programs in accordance with the provi24 sions of this section. The Secretary shall award grants on

25 a competitive basis to pay the Federal share for American
110

•HR 820 RH

1 workforce quality partnership programs to establish

2 workforce training consortia between industry and institu3 tions of higher education.

4 ‘‘(b) GRANT PERIOD.—Grants awarded under this sec5 tion may be for a period of 5 years.

6 ‘‘(c) GENERAL AUTHORITY.—Each grant recipient

7 shall use amounts provided under the grant to develop and

8 operate an American workforce quality partnership pro9 gram.

10 ‘‘(d) CONTENTS OF PROGRAM.—An American

11 workforce quality partnership program shall establish part12 nerships among—

13 ‘‘(1) one or more United States manufacturers;

14 ‘‘(2) an organization or organizations represent15 ing the nonmanagerial employees of the manufactur16 ers described in paragraph (1); and

17 ‘‘(3) a local community technical college or other

18 appropriate institutions of higher education, a voca19 tional training institution, a Regional Center for the

20 Transfer of Manufacturing Technology, a Manufac21 turing Outreach Center, or any similar entity or con22 sortium of such institutions,

23 to train the employees of the industrial partners through

24 both workplace-based and classroom-based programs of

25 training.
111

•HR 820 RH

1 ‘‘(e) FEDERAL SHARE.—The Federal share of the cost

2 of an American workforce quality partnership program

3 may not exceed 50 percent of the total cost of the program.

4 The non-Federal share of such costs may be provided in5 cash or in-kind, fairly valued. The total contribution of the

6 proposed partnership should reflect a substantial contribu7 tion on the part of the industrial partners and appropriate

8 contributions of the education partners, local or State gov9 ernments, and other appropriate entities.

10 ‘‘(f) APPLICATIONS.—

11 ‘‘(1) ELIGIBILITY.—Any consortium described in

12 subsection (d) may apply for a grant under this sec13 tion at such time and in such manner as the Sec14 retary shall prescribe.

15 ‘‘(2) PLAN.—Each application submitted under

16 this subsection shall contain a plan for the develop17 ment and implementation of an American workforce

18 quality partnership program under this section. Such

19 plan shall—

20 ‘‘(A) show a demonstrated commitment, on

21 the part of the industrial partners, to adopt total

22 quality management strategies or other plausible

23 strategies to renew its competitive edge;

24 ‘‘(B) demonstrate the need for Federal re25 sources because of the long-term nature and risk
112

•HR 820 RH

1 of such an investment, the inability to finance

2 such ventures because of the high cost of capital3 ization, intense competition from foreign indus4 tries, or such other appropriate reasons as may

5 limit the industrial partners’ ability to launch

6 programs where worker training and develop7 ment is a substantial component;

8 ‘‘(C) demonstrate long-term benefit for all

9 partners and the local economy, through an en10 hanced competitive position of the industrial

11 partners, substantial benefits for regional em12 ployment, and the ability of the education and

13 labor participants to further their capabilities to

14 educate and train other nonpartnership-affili15 ated individuals wishing to obtain or upgrade

16 technical, technological, industrial management

17 and leadership, or other industrial skills;

18 ‘‘(D) make full, appropriate, and innovative

19 use of industrial and higher education resources

20 and other local resources such as facilities, equip21 ment, personnel exchanges, experts, or consult22 ants;

23 ‘‘(E) provide for the establishment of an ad24 visory board in accordance with subsection (h);
113

•HR 820 RH

1 ‘‘(F) include an explanation of the indus2 trial partners’ plans to adopt new competitive

3 strategies and how the training partnership aids

4 that effort; and

5 ‘‘(G) include assurances that the eligible en6 tity will maintain its aggregate expenditures

7 from all sources for employee training, other

8 than those provided under this section, at or

9 above the average level of such expenditures in

10 the 2 fiscal years preceding submission of an ap11 plication for assistance under this section.

12 ‘‘(3) APPROVAL.—

13 ‘‘(A) IN GENERAL.—The Secretary shall ap14 prove applications based on their potential to

15 create an effective American workforce quality

16 partnership program in accordance with this

17 section.

18 ‘‘(B) CRITERIA.—In reviewing grant appli19 cations, the Secretary shall give significant con20 sideration to the following criteria:

21 ‘‘(i) Saliency of argument for requir22 ing a Federal investment.

23 ‘‘(ii) Commitment of partnership to

24 continue operation after the termination of

25 Federal funding.
114

•HR 820 RH

1 ‘‘(iii) The likelihood that the training

2 will improve the long-term competitiveness

3 of the industrial partners and contribute

4 significantly to economic growth.

5 ‘‘(iv) The likelihood that the partner6 ship will benefit the education mission of

7 the education partners in ways outside of

8 the scope of the partnership, such as devel9 oping the capability to train other

10 nonpartnership-affiliated individuals in

11 similar skills.

12 ‘‘(C) PRIORITY CONSIDERATION.—The Sec13 retary shall give priority consideration to indus14 tries which are threatened by intense foreign

15 competition important to the long-term national

16 economic or military security of the United

17 States and industries which are critical in ena18 bling other United States industries to maintain

19 a healthy competitive position. In addition, the

20 Secretary shall give priority to applicants in

21 areas of high poverty and unemployment.

22 ‘‘(g) USE OF FUNDS.—

23 ‘‘(1) APPROVED USES.—Federal funds may be

24 used for—
115

•HR 820 RH

1 ‘‘(A) the direct costs of workplace-based and

2 classroom-based training in advanced technical,

3 technological, and industrial management, skills,

4 and training for the implementation of total

5 quality management and technology manage6 ment strategies, or other competitiveness strate7 gies, contained in the applicant’s plan submitted

8 under subsection (f)(2)(F);

9 ‘‘(B) the purchase or lease of equipment or

10 other materials for the purpose of instruction to

11 aid in training;

12 ‘‘(C) the development of in-house curricula

13 or coursework or other training-related pro14 grams, including the training of teachers and

15 other eligible participants to utilize such curric16 ula or coursework; and

17 ‘‘(D) reasonable administrative expenses

18 and other indirect costs of operating the partner19 ship which may not exceed 10 percent of the

20 total cost of the program.

21 ‘‘(2) LIMITATIONS.—Federal funds may not be

22 used for nontraining related costs of adopting new

23 competitive strategies including the replacement of

24 manufacturing equipment, product redesign and

25 manufacturing facility construction costs, or salary
116

•HR 820 RH

1 compensation of the partners’ employees. Grants shall

2 not be made under this section for programs that will

3 impair any existing program, contract, or agreement

4 without the written concurrence of the parties to such

5 program, contract, or agreement.

6 ‘‘(h) ADVISORY BOARD.—

7 ‘‘(1) Each partnership shall establish an advi8 sory board which shall include representation from

9 each of the following categories:

10 ‘‘(A) Multiple organizational levels of the

11 industrial partners, that shall include manage12 rial employees.

13 ‘‘(B) The education partners.

14 ‘‘(C) Organizations representing

15 nonmanagerial employees.

16 ‘‘(2) The advisory board shall—

17 ‘‘(A) advise the partnership on the general

18 direction and policy of the partnership including

19 training, instruction, and other related issues;

20 ‘‘(B) report to the Secretary after the second

21 and fourth year of the program, on the progress

22 and status of the partnership, including its

23 strengths, weaknesses, and new directions, the

24 number of individuals served, types of services

25 provided, and an outline of how the program can
117

•HR 820 RH

1 be integrated into the existing training infra2 structure in place in other Federal agencies and

3 departments; and

4 ‘‘(C) assist in the revision of the plans (sub5 mitted with the application under subsection

6 (f)(2)(F)) and include revised plans as necessary

7 in the reports required under subparagraph

8 (B).’’.

9 (b) EFFECTIVE DATE.—The amendment made by sub10 section (a) shall take effect on October 1, 1994.

11 SEC. 408. SEVERABILITY.

12 If any provision of this Act or the amendments made

13 by this Act, or the application thereof to any person or cir14 cumstance, is held invalid, the remainder of this Act and

15 the amendments made by this Act, and the application

16 thereof to other persons or circumstances, shall not be

17 affected thereby.

18 SEC. 409. SUNSET.

19 (a) REPORT TO CONGRESS.—Before April 1, 1995, the

20 Secretary shall submit to the Congress a report that evalu21 ates the success of the programs established by this Act, and

22 the amendments made by this Act, in achieving the pur23 poses of this Act.

24 (b) LIMITATION ON APPROPRIATIONS.—Notwithstand25 ing any other provision of this Act, no funds are authorized
118

•HR 820 RH

1 to be appropriated for any fiscal year after fiscal year 1995

2 for carrying out the programs for which funds are author3 ized by this Act, or the amendments made by this Act.

4 SEC. 410. USE OF DOMESTIC PRODUCTS.

5 (a) PROHIBITION AGAINST FRAUDULENT USE OF

6 ‘‘MADE IN AMERICA’’ LABELS.—(1) A person shall not in7 tentionally affix a label bearing the inscription of ‘‘Made

8 in America’’, or any inscription with that meaning, to any

9 product sold in or shipped to the United States, if that

10 product is not a domestic product.

11 (2) A person who violates paragraph (1) shall not be

12 eligible for any contract for a procurement carried out with

13 amounts authorized under this Act, or under any amend14 ment made by this Act, including any subcontract under

15 such a contract pursuant to the debarment, suspension, and

16 ineligibility procedures in subpart 9.4 of chapter 1 of title

17 48, Code of Federal Regulations, or any successor proce18 dures thereto.

19 (b) COMPLIANCE WITH BUY AMERICAN ACT.—(1) Ex20 cept as provided in paragraph (2), the head of each agency

21 which conducts procurements shall ensure that such pro22 curements are conducted in compliance with sections 2

23 through 4 of the Act of March 3, 1933 (41 U.S.C. 10a

24 through 10c, popularly known as the ‘‘Buy American Act’’).
119

•HR 820 RH

1 (2) This subsection shall apply only to procurements

2 made for which—

3 (A) amounts are authorized by this Act, or by

4 any amendment made by this Act, to be made avail5 able; and

6 (B) solicitations for bids are issued after the date

7 of enactment of this Act.

8 (3) The Secretary, before January 1, 1995, shall report

9 to the Congress on procurements covered under this sub10 section of products that are not domestic products.

11 (c) DEFINITIONS.—For the purposes of this section, the

12 term ‘‘domestic product’’ means a product—

13 (1) that is manufactured or produced in the

14 United States; and

15 (2) at least 50 percent of the cost of the articles,

16 materials, or supplies of which are mined, produced,

17 or manufactured in the United States.

18 SEC. 411. NATIONAL QUALITY PROGRAM.

19 (a) ESTABLISHMENT.—There is established, under the

20 supervision of the Director, a National Quality Program

21 (in this section referred to as the ‘‘Program’’). The purpose

22 of the Program shall be to enhance the Malcolm Baldrige

23 National Quality Award, to disseminate information, and

24 to promote and take part in educational and research ac25 tivities regarding ways in which United States companies
120

•HR 820 RH

1 and organizations can improve their quality management

2 practices and productivity.

3 (b) ACTIVITIES.—As part of the Program, the Director

4 is authorized—

5 (1) to develop industry-led workshops, seminars,

6 and other mechanisms to disseminate broadly to

7 United States companies and organizations the best

8 practices available in total quality management, in9 cluding the practices and quality improvement strate10 gies successfully employed by those firms that have

11 won the Malcolm Baldrige National Quality Award,

12 as well as best practices in lean production methods,

13 market-driven product improvement, and customer14 supplier relations;

15 (2) to work with industry leaders and others to

16 develop both measures of quality and recommenda17 tions concerning what skills employees should have in

18 order to participate effectively in company quality

19 programs; and

20 (3) to explore, with private industry, other Fed21 eral agencies, and State and local government, inno22 vative ways in which 2-year colleges and other edu23 cational institutions can teach quality assurance tech24 niques and related background skills to industrial

25 workers in both manufacturing and services.
121

•HR 820 RH

1 TITLE V—AUTHORIZATIONS OF

2 APPROPRIATIONS

3 SEC. 501. TECHNOLOGY ADMINISTRATION.

4 There are authorized to be appropriated to the Sec5 retary, to carry out the activities of the Under Secretary

6 and the Assistant Secretary of Commerce for Technology

7 Policy, in addition to any other amounts authorized for

8 such purposes, for the Office of the Under Secretary—

9 (1) $5,425,000 for fiscal year 1994; and

10 (2) $10,000,000 for fiscal year 1995, of which

11 $2,000,000 are authorized for competitiveness assess12 ments and evaluations under section 101(e) of the

13 Stevenson-Wydler Technology Innovation Act of 1980,

14 as so redesignated by section 206(b)(2) of this Act.

15 SEC. 502. NATIONAL INSTITUTE OF STANDARDS AND TECH16 NOLOGY.

17 (a) INTRAMURAL SCIENTIFIC AND TECHNICAL RE18 SEARCH AND SERVICES.—(1) There are authorized to be ap19 propriated to the Secretary, to carry out the intramural

20 scientific and technical research and services activities of

21 the Institute, $240,988,000 for fiscal year 1994 and

22 $300,000,000 for fiscal year 1995.

23 (2) Of the amounts authorized under paragraph (1)—
122

•HR 820 RH

1 (A) $1,000,000 for fiscal year 1994 and

2 $1,000,000 for fiscal year 1995 are authorized only

3 for the evaluation of nonenergy-related inventions;

4 (B) $9,000,000 for fiscal year 1994 and

5 $10,000,000 for fiscal year 1995 are authorized only

6 for the technical competence fund; and

7 (C) $2,000,000 for fiscal year 1994 and

8 $3,000,000 for fiscal year 1995 are authorized only

9 for the standards pilot project established under sec10 tion 104(e) of the American Technology Preeminence

11 Act of 1991.

12 (b) TRANSFERS.—(1) Funds may be transferred

13 among the line items listed in subsection (a), so long as—

14 (A) the net funds transferred to or from any line

15 item do not exceed 10 percent of the amount author16 ized for that line item in such subsection;

17 (B) the aggregate amount authorized under sub18 section (a) is not changed; and

19 (C) the Committee on Commerce, Science, and

20 Transportation of the Senate and the Committee on

21 Science, Space, and Technology of the House of Rep22 resentatives are notified in advance of any such

23 transfer.

24 (2) The Secretary may propose transfers to or from

25 any line item listed in subsection (a) exceeding 10 percent
123

•HR 820 RH

1 of the amount authorized for such line item, but such pro2 posed transfer may not be made unless—

3 (A) a full and complete explanation of any such

4 proposed transfer and the reason therefor are trans5 mitted in writing to the Speaker of the House of Rep6 resentatives, the President of the Senate, and the ap7 propriate authorizing Committees of the House of

8 Representatives and the Senate; and

9 (B) 30 days have passed following the trans10 mission of such written explanation.

11 (c) EXTRAMURAL INDUSTRIAL TECHNOLOGY SERV12 ICES.—In addition to the amounts authorized under sub13 section (a), there are authorized to be appropriated to the

14 Secretary, to carry out the extramural industrial technology

15 services activities of the Institute—

16 (1) for Regional Centers for the Transfer of Man17 ufacturing Technology, for the National Technology

18 Outreach Program established under section 303 of

19 the Stevenson-Wydler Technology Innovation Act of

20 1980, and for the National Quality Program estab21 lished under section 410 of this Act—

22 (A) for fiscal year 1994, $30,035,000; and

23 (B) for fiscal year 1995, $150,000,000, of

24 which $50,000,000 are authorized for Regional

25 Centers for the Transfer of Manufacturing Tech-
124

•HR 820 RH

1 nology, and of which $97,000,000 are authorized

2 for the National Technology Outreach Program;

3 (2) for the State Technology Extension Program,

4 $3,000,000 for fiscal year 1994 and $3,000,000 for

5 fiscal year 1995; and

6 (3) for the Advanced Technology Program—

7 (A) $197,489,000 for fiscal year 1994, of

8 which $20,000,000 are authorized for the Ad9 vanced Manufacturing Technology Development

10 Program established under section 304 of the

11 Stevenson-Wydler Technology Innovation Act of

12 1980; and

13 (B) $450,000,000 for fiscal year 1995, of

14 which $100,000,000 are authorized for carrying

15 out section 322 of this Act, and of which

16 $50,000,000 are authorized for the Advanced

17 Manufacturing Technology Development Pro18 gram established under section 304 of the Steven19 son-Wydler Technology Innovation Act of 1980.

20 (d) FACILITIES CONSTRUCTION.—There are authorized

21 to be appropriated to the Secretary, to carry out construc22 tion and modernization of Institute facilities, $61,686,000

23 for fiscal year 1994 and $106,000,000 for fiscal year 1995.

24 (e) LIMITATION.—Notwithstanding any other provi25 sion of this title, the total amount which may be appro-
125

•HR 820 RH

1 priated to the Secretary pursuant to this title for fiscal year

2 1995 shall not exceed $950,000,000.

3 SEC. 503. ADDITIONAL ACTIVITIES OF THE TECHNOLOGY

4 ADMINISTRATION.

5 In addition to the amounts authorized under sections

6 501 and 502, there are authorized to be appropriated to

7 the Secretary—

8 (1) for the Civilian Technology Loan Program

9 established under subtitle C of title III of this Act,

10 $1,000,000 for fiscal year 1994 and $20,000,000 for

11 the fiscal year 1995;

12 (2) for the Civilian Technologies Development

13 Program established under subtitle D of title III of

14 this Act, $1,000,000 for fiscal year 1994 and

15 $50,000,000 for the fiscal year 1995;

16 (3) for carrying out the Benchmarking Program

17 established under title IV of the Stevenson-Wydler

18 Technology Innovation Act of 1980, $2,000,000 for

19 fiscal year 1994 and $10,000,000 for fiscal year 1995;

20 and

21 (4) for carrying out the American workforce

22 quality partnership program established under section

23 305 of the Stevenson-Wydler Technology Innovation

24 Act of 1980, $50,000,000 for fiscal year 1995.
126

•HR 820 RH

1 Of the amounts made available under paragraph (1) for

2 a fiscal year, not more than $2,000,000 or 10 percent,

3 whichever is greater, shall be available for administrative

4 expenses. Of the amounts made available under paragraph

5 (2) for a fiscal year, not more than $5,000,000 or 10 per6 cent, whichever is greater, shall be available for administra7 tive expenses. The Secretary shall ensure that audits are

8 performed by independent auditors on the programs for

9 which funds are appropriated pursuant to this section or

10 section 502(c). The summary results of such audits shall

11 be submitted to the Congress by the end of each of the fiscal

12 years 1994 and 1995, and not more than $2,000,000, or

13 2 percent of the aggregate amount made available under

14 such section and subsection, whichever is greater, shall be

15 used in each such fiscal year for performing the audits.

16 SEC. 504. NATIONAL SCIENCE FOUNDATION.

17 In addition to such other sums as may be authorized

18 by other Acts to be appropriated to the Director of the Na19 tional Science Foundation, there are authorized to be ap20 propriated to that Director—

21 (1) for carrying out section 212 of this Act,

22 $20,000,000 for fiscal year 1995; and

23 (2) for carrying out section 213 of this Act,

24 $30,000,000 for fiscal year 1995.
127

•HR 820 RH

1 SEC. 505. AVAILABILITY OF APPROPRIATIONS.

2 Except as otherwise provided in this title, appropria3 tions made under the authority provided in this title shall

4 remain available for obligation until expended.

5 SEC. 506. SENSE OF THE CONGRESS.

6 It is the sense of the Congress that the programs au7 thorized by this Act are not sufficient to address the root

8 cause of the competitiveness problems facing United States

9 commerce and manufacturing. Further, it is the sense of

10 the Congress that there exist fundamental competitiveness

11 disadvantages imposed by Government on American busi12 ness, and that the Federal Government can fuel economic

13 growth and private sector job creation by reducing the na14 tional debt to reduce the cost of capital, providing tax in15 centives to further enhance private capital formation, re16 forming antitrust law to remove barriers to cooperative en17 terprise, instituting civil justice reform to reduce litigious

18 burdens, and reexamining those provisions of law and regu19 lation which are anticompetitive in nature. Finally, it is

20 the sense of the Congress that legislation implementing these

21 needed reforms should be enacted this year.

HR 820 RH——2

HR 820 RH——3

HR 820 RH——4

HR 820 RH——5

HR 820 RH——6
128

•HR 820 RH

HR 820 RH——7

HR 820 RH——8

HR 820 RH——9