```

[Congressional Bills 103th Congress]
[From the U.S. Government Publishing Office]
[H.R. 1057 Introduced in House (IH)]

103d CONGRESS
  1st Session
                                H. R. 1057

            To protect and promote small business concerns.

_______________________________________________________________________

                    IN THE HOUSE OF REPRESENTATIVES

                           February 23, 1993

Mrs. Meyers of Kansas introduced the following bill; which was referred 
   jointly to the Committees on Ways and Means, Small Business, the 
               Judiciary, Rules, and Education and Labor

_______________________________________________________________________

                                 A BILL

 
            To protect and promote small business concerns.

    Be it enacted by the Senate and House of Representatives of the 
United States of America in Congress assembled,

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Omnibus Small Business Promotion and 
Protection Act of 1993''.

                 TITLE I--SMALL BUSINESS TAX INCENTIVES

SEC. 101. RESEARCH CREDIT.

    (a) In General.--Section 41 of the Internal Revenue Code of 1986 
(relating to credit for increasing research activities) is amended by 
striking subsection (h).
    (b) Conforming Amendment.--Paragraph (1) section 28(b) of such Code 
is amended by striking subparagraph (D).
    (c) Effective Date.--The amendments made by this section shall 
apply to taxable years ending after June 30, 1992.

SEC. 102. TARGETED JOBS CREDIT.

    (a) In General.--Subsection (c) of section 51 of the Internal 
Revenue Code of 1986 (relating to amount of targeted jobs credit) is 
amended by striking paragraph (4).
    (b) Effective Date.--The amendment made by subsection (a) shall 
apply to individuals who begin work for the employer after June 30, 
1992.

SEC. 103. QUALIFIED SMALL ISSUE BONDS.

    (a) In General.--Subparagraph (B) of section 144(a)(12) of the 
Internal Revenue Code of 1986 is amended to read as follows:
                            ``(B) Bonds issued to finance manufacturing 
                        facilities and farm property.--Subparagraph (A) 
                        shall not apply to any bond issued as part of 
                        an issue 95 percent or more of the net proceeds 
                        of which are to be used to provide--
                            ``(i) any manufacturing facility, or
                            ``(ii) any land or property in accordance 
                        with section 147(c)(2).''
    (b) Effective Date.--The amendment made by subsection (a) shall 
apply to bonds issued after June 30, 1992.

SEC. 104. EMPLOYER-PROVIDED EDUCATIONAL ASSISTANCE.

    (a) In General.--Section 127 of the Internal Revenue Code of 1986 
(relating to educational assistance programs) is amended by striking 
subsection (d) and by redesignating subsection (e) as subsection (d).
    (b) Conforming Amendment.--Paragraph (2) of section 103(a) of the 
Tax Extension Act of 1991 is hereby repealed.
    (c) Effective Date.--The amendments made by this section shall 
apply to taxable years beginning after June 30, 1992.

SEC. 105. DEDUCTION FOR HEALTH INSURANCE COSTS OF SELF-EMPLOYED 
              INDIVIDUALS INCREASED AND MADE PERMANENT.

    (a) In General.--Paragraph (1) of section 162(l) of the Internal 
Revenue Code of 1986 (relating to special rules for health insurance 
costs of self-employed individuals) is amended by striking ``25 percent 
of''.
    (b) Deduction Made Permanent.--Paragraph (6) of section 162(l) of 
such Code is hereby repealed.
    (c) Effective Date.--The amendments made by this section shall 
apply to taxable years beginning after June 30, 1992.

  TITLE II--INCREASE OF NUMBER OF PERMITTED S CORPORATION SHAREHOLDERS

SEC. 201. INCREASE OF NUMBER OF PERMITTED S CORPORATION SHAREHOLDERS.

    (a) In General.--Subparagraph (A) of section 1361(b)(1) of the 
Internal Revenue Code of 1986 (defining small business corporation) is 
amended by striking ``35 shareholders'' and inserting ``50 
shareholders''.
    (b) Effective Date.--The amendment made by this section shall take 
effect on the date of the enactment of this Act.

             TITLE III--WOMEN-OWNED SMALL BUSINESS CONCERNS

SEC. 301. PARTICIPATION IN SUBCONTRACTING PROGRAMS.

    (a) Eligibility Requirements.--
            (1) Definition of socially disadvantaged small business 
        concern.--Section 8(a)(5) of the Small Business Act (15 U.S.C. 
        637(a)(5)) is amended by striking ``racial or ethnic 
        prejudice'' and inserting ``racial, ethnic, or gender-based 
        prejudice''.
            (2) Presumption of social disadvantage under contract 
        clause.--The contract clause specified in section (8)(d)(3) of 
        the Small Business Act (15 U.S.C. 637(d)(3)) is amended by 
        striking ``and other minorities'' in subparagraph (C) of such 
        clause and inserting ``other minorities, and women''.
    (b) Treatment of Community Property Laws.--The Small Business Act 
(15 U.S.C. 631 et seq.) is amended--
            (1) in section 8(a)(4) by adding at the end the following 
        new subparagraph:
                    ``(D) The community property laws of a jurisdiction 
                shall not be applied in determining whether a small 
                business concern meets the requirements of this 
                paragraph with regard to ownership and control.'';
            (2) in section 8(a)(6)(E)--
                    (A) by striking the period at the end of clause 
                (ii) and inserting ``; and''; and
                    (B) by adding at the end the following new clause:
                            ``(iii) the value of any property which is 
                        owned by a disadvantaged owner solely on the 
                        basis of application of the community property 
                        laws of a jurisdiction.''; and
            (3) in the contract clause specified in section (8)(d)(3) 
        by adding at the end of subparagraph (C) of such clause the 
        following new sentence: ``The community property laws of a 
        jurisdiction shall not be applied in determining whether a 
        small business concern meets the requirements of this 
        subparagraph with regard to ownership and control.''.

         TITLE IV--PREPAYMENT OF DEVELOPMENT COMPANY DEBENTURES

SEC. 401. PREPAYMENT OF DEVELOPMENT COMPANY DEBENTURES.

    (a) In General.--Title V of the Small Business Investment Act of 
1958 (15 U.S.C. 695 et seq.) is amended by adding at the end the 
following new section:

``SEC. 507. PREPAYMENT OF DEVELOPMENT COMPANY DEBENTURES.

    ``(a) In General.--(1) If the requirements of subsection (b) are 
met, the issuer of a debenture purchased by the Federal Financing Bank 
and guaranteed by the Administration under section 503 may, at the 
election of the borrower whose loan secures such debenture, prepay such 
debenture by paying to the Federal Financing Bank, not later than 2 
years after the date of the enactment of this section, the amount that 
is equal to the sum of the unpaid principal balance (plus accrued 
interest at the coupon rate on the debenture) due on the debenture on 
the date of prepayment and the amount of the penalty described in 
paragraph (2)(A).
    ``(2)(A) The amount of the penalty described in this paragraph is 
the amount described in subparagraph (B) reduced by any fees paid 
pursuant to subsection (d)(2).
    ``(B) The amount described in this subparagraph is the amount equal 
to the original principal amount of the debenture--
            ``(i) multiplied by the interest rate of the debenture;
            ``(ii) multiplied by the number of years remaining to 
        maturity on the debenture; and
            ``(iii) divided by the number of years to maturity on the 
        debenture when the debenture was originally issued.
    ``(b) Requirements.--The requirements of this subsection are met 
if--
            ``(1) the debenture referred to in subsection (a) is 
        outstanding on the date of the enactment of this section and 
        neither the debenture nor the borrower's loan that secures the 
        debenture is in default on the date of prepayment;
            ``(2) only non-Federal funds are used to prepay the 
        debenture;
            ``(3) the issuer extinguishes the borrower's loan which 
        secured such debenture;
            ``(4) in the case of prepayment of a debenture in which a 
        new debenture is issued and guaranteed by the Administration 
        under section 503 and sold under section 504 (or the 
        Administration issues a trust certificate representing 
        ownership in such new debenture under section 505) for the 
        purpose of such prepayment, the issuer certifies that it will 
        waive any origination fee on the new debenture to which it 
        otherwise would have been entitled; and
            ``(5) the borrower certifies that it will pay to the issuer 
        the amount of the penalty referred to in subsection (a)(2)(A).
    ``(c) Transfer of Guarantee.--
            ``(1) In general.--Notwithstanding any other law, in the 
        case of prepayment of a debenture under subsection (a) in which 
        a new debenture is issued by a qualified State or local 
        development company and guaranteed by the Administration under 
        section 503 and sold under section 504 (or the Administration 
        issues a trust certificate representing ownership in such new 
        debenture under section 505) for the purpose of such 
        prepayment, the guarantee by the Administration under section 
        503 of the original debenture shall transfer to the new 
        debenture, and the transfer of such guarantee shall not be 
        treated as new credit authority.
            ``(2) Full faith and credit of the united states.--The full 
        faith and credit of the United States shall continue to be 
        pledged to the payment of all amounts which may be required to 
        be paid under any guarantee of a new debenture or trust 
        certificate referred to in paragraph (1).
    ``(d) Fees.--
            ``(1) In general.--Notwithstanding any other law and 
        subject to paragraph (2), no fees or penalties other than those 
        specified in this section may be imposed as a condition of 
        prepayment under subsection (a) against the issuer, the 
        borrower, or the Administration.
            ``(2) Optional fees.--The issuer may require the borrower 
        to pay a fee to the issuer in an amount equal to--
                    ``(A) in cases other than the case described in 
                subparagraph (B), 1 percent of the sum of the unpaid 
                principal balance and the accrued interest (at the 
                coupon rate on the debenture) due on the debenture on 
                the date of prepayment; and
                    ``(B) in the case of prepayment of a debenture 
                under subsection (a) in accordance with the method 
                described in subsection (c)(1), one-half of 1 percent 
                of the sum of the unpaid principal balance and the 
                accrued interest (at the coupon rate on the debenture) 
                due on the debenture on the date of prepayment.
    ``(e) Default of Loan Securing Debenture.--If a borrower defaults 
on a loan securing a debenture issued under section 503, including a 
default which occurred before the date of the enactment of this 
section, the Administration's guarantee under section 503 shall be 
extinguished by payment by the Administration to the Federal Financing 
Bank of the remaining principal balance plus accrued interest at the 
coupon rate on the debenture.
    ``(f) Definitions.--For purposes of this section, the following 
definitions apply:
            ``(1) Borrower.--The term `borrower' means a small business 
        concern.
            ``(2) Credit authority and new budget authority.--The terms 
        `credit authority' and `new budget authority' have the meanings 
        given such terms in section 3 of the Congressional Budget Act 
        of 1974.
            ``(3) Issuer.--The term `issuer' means a qualified State or 
        local development company.
            ``(4) Qualified state or local development company.--The 
        term `qualified State or local development company' has the 
        meaning given such term in section 503(e).''.
    (b) Clerical Amendment.--The table of contents of title V of the 
Small Business Investment Act of 1958 is amended by adding at the end 
the following new item:

``Sec. 507. Prepayment of development company debentures.''.

          TITLE V--CABINET LEVEL STATUS FOR SBA ADMINISTRATOR

SEC. 501. PARTICIPATION IN CABINET.

    It is the sense of the Congress that the Administrator of the Small 
Business Administration should be designated by the President--
            (1) as a member of, and a full participant in activities 
        of, the Cabinet; and
            (2) as the President's principal adviser on all matters 
        relating to small business.

SEC. 502. PAY STATUS COMMENSURATE WITH CABINET STATUS.

    (a) Executive Level I.--Section 5312 of title 5, United States Code 
(relating to executive level I), is amended by adding at the end the 
following new item:
            ``Administrator of the Small Business Administration.''.
    (b) Conforming Amendment.--Section 5314 of such title (relating to 
executive level III) is amended by striking the following item:
            ``Administrator of the Small Business Administration.''.

   TITLE VI--ASSISTANT UNITED STATES TRADE REPRESENTATIVE FOR SMALL 
                                BUSINESS

SEC. 601. SENSE OF CONGRESS.

    It is the sense of Congress that the United States Trade 
Representative should establish a new position of Assistant United 
States Trade Representative for Small Business to promote exports by 
small businesses and to remove foreign impediments to the success of 
such undertakings.

      TITLE VII--JUDICIAL REVIEW UNDER REGULATORY FLEXIBILITY ACT

SEC. 701. JUDICIAL REVIEW UNDER REGULATORY FLEXIBILITY ACT.

    (a) In General.--Section 611 of title 5, United States Code, is 
repealed.
    (b) Clerical Amendment.--The table of sections at the beginning of 
chapter 6 of title 5, United States Code, is amended by striking the 
item relating to section 611.

TITLE VIII--CONGRESSIONAL BUDGET OFFICE SMALL BUSINESS LEGISLATIVE COST 
                                ANALYSIS

SEC. 801. CONGRESSIONAL BUDGET OFFICE COST ANALYSIS.

    (a) CBO Analysis.--Title IV of the Congressional Budget Act of 1974 
(2 U.S.C. 651 et seq.) is amended by inserting after section 403 the 
following new section:

     ``small business cost analysis by congressional budget office

    ``Sec. 404. (a) The Director of the Congressional Budget Office 
shall, to the extent practicable, prepare for each bill or resolution 
of a public character reported by any committee of the House of 
Representatives or the Senate (except the Committee on Appropriations 
of each House), and submit to such committee--
            ``(1) an estimate of the costs which would be incurred in 
        carrying out such bill or resolution in the fiscal year in 
        which it is to become effective and in each of the 4 fiscal 
        years following such fiscal year, together with the basis for 
        each such estimate;
            ``(2) an estimate of the cost which would be incurred by 
        small businesses in carrying out or complying with any 
        significant bill or resolution in the fiscal year in which it 
        is to become effective and in each of the 4 fiscal years 
        following such fiscal year, together with the basis for each 
        such estimate; and
            ``(3) a comparison of the estimates of costs described in 
        paragraphs (1) and (2) with any available estimates of costs 
        made by such committee or by a Federal agency.
The estimates, comparison, and description so submitted shall be 
included in the report accompanying such bill or resolution if timely 
submitted to such committee before such report is filed.
    ``(b) For purposes of subsection (a)(2), the term `small business' 
has the same meaning as the term `small-business concern' in section 
3(a) of the Small Business Act (15 U.S.C. 632(a)).
    ``(c) For purposes of subsection (a)(2), the term `significant bill 
or resolution' is defined as any bill or resolution which in the 
judgment of the Director of the Congressional Budget Office is likely 
to result in an average annual cost to a small business of $1,000 or 
more, or is likely to have exceptional fiscal consequences for a 
geographic region or a particular industry segment.''.
    (b) Conforming Amendment.--The table of contents set forth in 
section 2(b) of the Congressional Budget and Impoundment Control Act of 
1974 is amended by inserting after the item relating to section 404 the 
following new item:

``Sec. 403. Small business cost analysis by Congressional Budget 
                            Office.''.

 TITLE IX--RELIEF FROM RETROACTIVE APPLICATION OF TREASURY DEPARTMENT 
                        REGULATIONS AND RULINGS

SEC. 901. RULES AND REGULATIONS.

    (a) In General.--Subsection (b) of section 7805 of the Internal 
Revenue Code is amended to read as follows:
    ``(b) Retroactivity of Regulations or Rulings.--
            ``(1) In general.--All final, temporary, or proposed 
        regulations and rulings issued by the Secretary shall apply 
        prospectively from the date of publication of such regulation 
        or ruling in the Federal Register.
            ``(2) Congressional authorization.--The prospective only 
        treatment of paragraph (1) may be superseded by a specific 
        legislative grant from Congress authorizing the Secretary to 
        prescribe the effective date with respect to a statutory 
        provision.''.
    (b) Effective Date.--The amendment made by this section shall apply 
to any temporary or proposed regulation published as a final regulation 
after the date of the enactment of this Act.

  TITLE X--STUDY OF IMPACT OF REGULATORY ANALYSIS UPON SMALL BUSINESS

SEC. 1001. STUDY.

    The Chief Counsel for Advocacy of the Small Business Administration 
shall conduct a study of the impact of all Federal regulatory paperwork 
and tax requirements upon small business and report its findings to the 
Congress within one year of the date of the enactment of this Act.

                   TITLE XI--FAIR LABOR STANDARDS ACT

SEC. 1101. APPLICATION OF FAIR LABOR STANDARDS ACT OF 1938.

    (a) Minimum Wage.--
            (1) Special industry committees.--Section 5(a) of the Fair 
        Labor Standards Act of 1938 (29 U.S.C. 205(a)) is amended--
                    (A) by striking out ``engaged in commerce or in the 
                production of goods for commerce, or employed in any 
                enterprise engaged in commerce or in the production of 
                goods for commerce'' and inserting in lieu thereof the 
                following: ``who are (1) engaged in industrial homework 
                subject to 11(d), or (2) either engaged in commerce or 
                engaged in the production of goods for commerce or 
                employed in an enterprise engaged in commerce or in the 
                production of goods for commerce''; and
                    (B) by striking out ``engaged in commerce or in the 
                production of goods for commerce in particular 
                industries'' and inserting in lieu thereof ``so 
                engaged''.
            (2) Minimum wage.--Section 6(a) of the Fair Labor Standards 
        Act of 1938 (29 U.S.C. 206(a)) is amended by striking out ``who 
        in any workweek is engaged in commerce or in the production of 
        goods for commerce, or is employed in an enterprise engaged in 
        commerce or in the production of goods for commerce'' and 
        inserting in lieu thereof the following: ``who in any workweek 
        is engaged in industrial homework subject to 11(d) or either 
        engaged in commerce or engaged in the production of goods for 
        commerce or employed in an enterprise engaged in commerce or in 
        the production of goods for commerce''.
            (3) Wage orders.--Section 8(a) of the Fair Labor Standards 
        Act of 1938 (29 U.S.C. 208(a)) is amended by striking out 
        ``employers in American Samoa engaged in commerce or in the 
        production of goods for commerce or in any enterprise engaged 
        in commerce or in the production of goods for commerce'' and 
        inserting in lieu thereof ``employers in American Samoa''.

SEC. 1102. MAXIMUM HOURS.

    Paragraphs (1) and (2) of section 7(a) of the Fair Labor Standards 
Act of 1938 (29 U.S.C. 207(a)) are each amended by striking the phrase 
``who in any workweek is engaged in commerce or in the production of 
goods for commerce, or is employed in an enterprise engaged in commerce 
or in the production of goods for commerce'' and inserting in lieu 
thereof the following: ``who in any workweek is (A) engaged in 
industrial homework subject to 11(d), or (B) either engaged in commerce 
or engaged in the production of goods for commerce or employed in an 
enterprise engaged in commerce or in the production of goods for 
commerce''.

                   TITLE XII--INDEPENDENT CONTRACTORS

SEC. 1201. SENSE OF CONGRESS.

    It is the sense of Congress that the Internal Revenue Service, in 
conjunction with the Office of Advocacy of the Small Business 
Administration, and in cooperation with the appropriate committees of 
Congress, should adopt objective, reasonable standards to determine 
independent contractor status.

                                 <all>

HR 1057 IH----2
```