I

103D CONGRESS

1ST SESSION H. R. 1208

To establish the Civilian Technology Corporation to provide financial support

for precommercial research and development in technologies that are

significant to the technology base of the United States.

IN THE HOUSE OF REPRESENTATIVES

MARCH 3, 1993

Mr. SANGMEISTER introduced the following bill; which was referred to the

Committee on Science, Space, and Technology

A BILL

To establish the Civilian Technology Corporation to provide

financial support for precommercial research and development in technologies that are significant to the technology base of the United States.

1 Be it enacted by the Senate and House of Representa2 tives of the United States of America in Congress assembled,

3 SECTION 1. SHORT TITLE.

4 This Act may be cited as the ‘‘Civilian Technology

5 Corporation Act of 1993’’.

6 SEC. 2. ESTABLISHMENT OF CORPORATION.

7 (a) IN GENERAL.—There shall be established a Civil8 ian Technology Corporation. The Corporation shall be op-
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1 erated for the purpose of providing financial support for

2 precommercial research and development into technologies

3 that are significant to the technology base of the United

4 States.

5 (b) CORPORATION NOT AN ESTABLISHMENT OF THE

6 UNITED STATES.—The Corporation shall not be an agen7 cy or establishment of the United States.

8 (c) PRIVACY ACT.—Notwithstanding subsection (b),

9 the Corporation shall be treated as an agency for the pur10 poses of section 552a of title 5, United States Code.

11 SEC. 3. INCORPORATION.

12 The board of directors of the Corporation first ap13 pointed shall be the incorporators and shall take all nec14 essary actions to establish the Corporation, including the

15 filing of articles of incorporation.

16 SEC. 4. DIRECTORS, OFFICERS, AND EMPLOYEES.

17 (a) BOARD OF DIRECTORS.—

18 (1) APPOINTMENT AND NUMBER.—The Cor19 poration shall have a Board consisting of 9 individ20 uals appointed by the President with the advice and

21 consent of the Senate.

22 (2) QUALIFICATIONS.—The directors of the

23 Corporation shall have the following qualifications:

24 (A) Not more than 5 directors shall be

25 members of the same political party.
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1 (B) The directors shall have technical,

2 business, or scientific expertise in civil research

3 and development or expertise in the area of eco4 nomics.

5 (C) Each director shall be a United States

6 Citizen.

7 (3) NO CONFLICT OF INTEREST.—A director

8 may not participate in the deliberations on, or vote

9 on, a matter regarding an application, claim, or

10 other matter pending before the Corporation, if, to

11 his knowledge, he, his spouse, minor child, parent,

12 sibling, partner, or organization, other than the Cor13 poration, in which he is serving as an officer, direc14 tor, trustee, partner, or employee, or any person

15 with whom he is negotiating or has any arrangement

16 concerning prospective employment, has a financial

17 interest in the matter. A director who violates this

18 paragraph shall be subject to removal from the

19 Board, but such a violation shall not impair, nullify,

20 or otherwise affect the validity of any otherwise law21 ful action by the Corporation in which such director

22 participated.

23 (4) COMPENSATION.—The compensation of the

24 Board shall be determined by the President with the

25 advice and consent of the Senate.
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1 (5) TERMS AND VACANCIES.—Members of the

2 Board shall serve terms of 5 years, and may serve

3 a maximum of two terms. Any vacancy in the mem4 bership of the Board shall be filled in the manner

5 set forth in paragraph (1).

6 (6) NO FEDERAL EMPLOYEES.—An individual

7 who is a member of the Congress, or an officer or

8 employee of the United States, may not serve on the

9 Board.

10 (7) CHAIRPERSON AND VICE-CHAIRPERSON.—

11 The Chairperson and Vice-Chairperson of the Board

12 shall be selected by the President. The position of

13 Chairperson shall be a full-time position and the in14 dividual who serves as Chairperson may not serve in

15 any other salaried position.

16 (8) BYLAWS.—The Board is empowered to

17 adopt and amend bylaws governing the operation of

18 the Corporation. Such bylaws shall not be inconsist19 ent with the provisions of this Act or the articles of

20 incorporation of the Corporation.

21 (b) OFFICERS AND EMPLOYEES.—

22 (1) APPOINTMENT.—The Board shall appoint a

23 chief executive officer, who shall have the authority

24 to appoint such other officers and employees as he
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1 deems necessary to carry out the provisions of this

2 Act and the functions of the Corporation.

3 (2) QUALIFICATIONS.—Officers and employees

4 of the Corporation shall have technical, business, or

5 administrative expertise in civil research and devel6 opment or expertise in the area of economics.

7 (3) NO CONFLICT OF INTEREST.—An officer or

8 employee may not participate in a matter regarding

9 an application, claim, or other matter pending before

10 the Corporation, if, to his knowledge, he, his spouse,

11 minor child, partner, or organization, other than the

12 Corporation, in which he is serving as an officer, di13 rector, trustee, partner, or employee, or any person

14 with whom he is negotiating or has any arrangement

15 concerning prospective employment, has a financial

16 interest in the matter. An officer or employee who

17 violates this paragraph shall be subject to termi18 nation, but such a violation shall not impair, nullify,

19 or otherwise affect the validity of any otherwise law20 ful action by the Corporation in which such officer

21 or employee participated.

22 (4) COMPENSATION.—The rates of compensa23 tion for all officers and employees shall be fixed by

24 the chief executive officer.
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1 (5) TENURE.—Officers and employees shall

2 serve at the pleasure of the Board.

3 SEC. 5. GENERAL POWERS.

4 The Corporation shall have the power to do the fol5 lowing:

6 (1) Have succession in the name of the Cor7 poration.

8 (2) Adopt, alter, and use a corporate seal.

9 (3) Sue and be sued in the name of the Cor10 poration.

11 (4) Make and carry out contracts.

12 (5) Exercise such other incidental powers not

13 inconsistent with this Act that are necessary or ap14 propriate to carry out the purposes and functions of

15 the Corporation, including the usual powers con16 ferred upon a corporation by the District of Colum17 bia Business Corporation Act.

18 SEC. 6. CIVILIAN TECHNOLOGY DEVELOPMENT FUND.

19 (a) ESTABLISHMENT OF FUND.—There is estab20 lished in the Treasury of the United States the Civilian

21 Technology Development Fund. The Fund shall be admin22 istered by the Corporation in order to carry out the pur23 poses of this Act. The Fund shall consist of the amounts

24 appropriated under subsection (b).
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1 (b) AUTHORIZATION OF APPROPRIATION.—There is

2 authorized to be appropriated $5,000,000,000 to be depos3 ited into the Fund and to remain available until expended.

4 (c) EXPENDITURES FROM THE FUND.—

5 (1) IN GENERAL.—Amounts in the Fund shall

6 be made available without fiscal year limitation to

7 the Corporation for the purposes of providing finan8 cial support, through direct investment, loans, li9 censes, equity positions, and joint venture partner10 ships, to United States based consortia, private

11 United States businesses with promising research

12 agendas, and educational institutions participating

13 in joint research projects with private United States

14 businesses, for precommercial research and develop15 ment in technologies that are significant to the tech16 nology base of the United States. In providing such

17 financial support, the Corporation shall—

18 (A) invest in areas where the social rate of

19 return is expected to be high but where individ20 ual firms or consortia are unlikely to invest be21 cause the economic rate of return is expected to

22 be low;

23 (B) invest in precommercial areas where

24 the social rate of return on investments is ex25 pected to be higher than the expected rate of
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1 return in the private sector, including research

2 and development projects that appear to have

3 the potential to enhance productivity and long4 term economic growth;

5 (C) invest exclusively in projects that were

6 initiated by industry and that include industry

7 participation; and

8 (D) except as provided in paragraph

9 (2)(B), invest in a project only if the Corpora10 tion shall be obligated to contribute not more

11 than 50 percent of the cost of such project.

12 (2) BOARD APPROVAL.—

13 (A) IN GENERAL.—No expenditures shall

14 be made under this subsection unless approved

15 by a majority vote of the Board following a con16 sideration of the factors referred to in para17 graph (1).

18 (B) INCREASED CONTRIBUTION.—Notwith19 standing paragraph (1)(D), the Corporation

20 may contribute more than 50 percent of the

21 cost of a project if the Board approves such a

22 contribution by a two-thirds vote.

23 (d) INVESTMENT OF EXCESS FUNDS.—If the Cor24 poration determines that the amount of money in the

25 Fund exceeds the current requirements of the Corpora-
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1 tion, the Corporation may direct the Secretary of the

2 Treasury to invest such amounts as the Corporation

3 deems advisable, for such period as the Corporation di4 rects, in obligations of the United States, in obligations

5 guaranteed by the United States Government, or in such

6 other obligations or securities of the United States as the

7 Secretary of the Treasury deems appropriate.

8 SEC. 7. CONSULTATION WITH FEDERAL AGENCIES AND DE9 PARTMENTS, AND WITH PRIVATE PARTIES.

10 (a) CONSULTATION WITH FEDERAL AGENCIES.—In

11 carrying out this Act, the Board and the Corporation shall

12 consult frequently with the following Federal agencies and

13 departments: the Office of Management and Budget, the

14 Department of Energy, the Department of Defense, the

15 National Science Foundation, and the Office of Science

16 and Technology Policy.

17 (b) CONSULTATION WITH PRIVATE PARTIES.—In

18 carrying out this Act, the Board and the Corporation shall

19 solicit comments from private parties, including represent20 atives of both industry and labor organizations.

21 SEC. 8. REVIEW OF CORPORATION BY BLUE RIBBON

22 PANEL.

23 (a) APPOINTMENT OF PANEL.—Not later than 90

24 days after the President and the Congress have received

25 the report under section 10(b), the President, the Senate,
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1 and the House of Representatives shall jointly appoint a

2 panel to carry out the review referred to in subsection (b).

3 The President shall appoint 3 members of the panel, the

4 Senate shall appoint 3 members of the panel, and the

5 House of Representatives shall appoint 3 members of the

6 panel.

7 (b) REVIEW BY PANEL.—Not later than 9 years after

8 the date of enactment of this Act, the panel shall conduct

9 a review of the performance of the Corporation to deter10 mine whether the Corporation—

11 (1) has had an overall positive effect on the

12 ability of the ability of United States industry to

13 commercialize and adopt new technologies;

14 (2) has invested in projects that exhibited a

15 high potential social rate of return if successful;

16 (3) has elicited strong, continuing support in

17 the private sector, particularly as reflected in the

18 willingness of firms to fund cooperative research and

19 development projects carried out under the sponsor20 ship of the Corporation; and

21 (4) should be terminated.

22 (c) REPORT.—Upon completion of the review referred

23 to in subsection (b), the panel shall submit a report to

24 the President, the Congress, and the Corporation. If the

25 panel determines that the Corporation should be termi-
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1 nated, the report shall include a recommended termination

2 date.

3 SEC. 9. AUDIT BY COMPTROLLER GENERAL.

4 The Comptroller General of the United States is au5 thorized to audit the financial transactions of the Corpora6 tion, including the operations of the Fund. For the pur7 poses of carrying out such an audit, the Comptroller Gen8 eral shall have access to all books, records, and property

9 belonging to, or in the possession of, the Corporation or

10 a person or entity which has entered into a financial rela11 tionship with the Corporation, which pertain to the Cor12 poration and which are necessary to carry out the audit.

13 The Comptroller General shall make a report of each such

14 audit to the Congress and the President.

15 SEC. 10. REPORTS.

16 (a) INITIAL REPORT.—The Corporation shall, after

17 the completion of the 4th year after the date of enactment

18 of this Act, submit a report to the President and the Con19 gress concerning the activities of the Corporation in carry20 ing out the purposes of this Act. Such report shall include

21 a description of the activities, expenditures, and invest22 ments of the Corporation, an analysis of the social rate

23 of return of projects in which the Corporation partici24 pated, and projections of future activities, expenditures,

25 and investments.
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1 (b) PREREVIEW REPORT.—The Corporation shall,

2 not later than 8 years after the date of enactment of this

3 Act, submit a report to the President and the Congress.

4 Such report shall contain the type of information referred

5 to in subsection (a).

6 SEC. 11. ADMINISTRATION.

7 (a) HEARINGS.—The Board may hold such hearings,

8 sit and act at such times and places, take such testimony,

9 receive such evidence, and publish or otherwise distribute

10 so much of its proceedings and reports as it may deem

11 advisable.

12 (b) OFFICE SPACE AND EQUIPMENT.—The Board

13 may acquire, furnish, and equip such office space as it

14 determines necessary.

15 (c) MAILS.—The Board is authorized to use the Unit16 ed States mails in the same manner and upon the same

17 conditions as Federal departments and agencies.

18 (d) NECESSARY EXPENSES.—The Board may incur

19 such necessary expenses and exercise such powers as are

20 consistent and reasonably required to perform its func21 tions.

22 (e) RECORDS.—To the extent permitted by law, all

23 appropriate records and papers of the Board shall be made

24 available for public inspection.
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1 (f) AID FROM FEDERAL AGENCIES.—Upon the re2 quest of the Board, the head of a Federal department or

3 agency is authorized to—

4 (1) furnish to the Board such information as

5 the Board deems necessary for carrying out its func6 tions and as is available to the agency; and

7 (2) detail for temporary duty, on a reimburs8 able basis, such personnel as the Board deems nec9 essary to carry out its functions.

10 (g) MEETINGS.—

11 (1) NUMBER.—The Board shall meet quarterly

12 each year, and may meet additional times at the call

13 of the Chairperson.

14 (2) QUORUM.—A majority of the members of

15 the Board shall constitute a quorum.

16 (3) OPEN TO PUBLIC.—All meetings of the

17 Board held to conduct official business of the Cor18 poration shall be open to the public following reason19 able public notice, except that the Board may close

20 a meeting to the public if the Board determines by

21 a majority vote, at a meeting open to the public,

22 that it is necessary to close such meeting.

23 SEC. 12. MISCELLANEOUS PROVISIONS.

24 (a) JURISDICTION.—
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1 (1) IN GENERAL.—Whenever the Corporation is

2 a party to any civil action under this Act, such ac3 tion shall be deemed to arise under the laws of the

4 United States. No attachment or execution may be

5 issued against the Corporation, or any property

6 thereof, prior to entry of final judgment.

7 (2) CITIZENSHIP OF CORPORATION.—The Cor8 poration shall be deemed to be a citizen only of the

9 District of Columbia for the purpose of determining

10 the original jurisdiction of the district courts of the

11 United States in civil actions to which the Corpora12 tion is a party.

13 (b) DISTRICT OF COLUMBIA LAWS RELATING TO

14 LEASES AND CONTRACTS.—Leases and contracts entered

15 into by the Corporation, regardless of the place where such

16 leases or contracts may be executed, shall be governed by

17 the laws of the District of Columbia.

18 (c) BUSINESS ACTIVITY AND QUALIFICATION; DIS19 TRICT OF COLUMBIA AS PRINCIPAL OFFICE AND PLACE

20 OF BUSINESS FOR PROCESS.—The Corporation shall be

21 deemed to be qualified to do business in each State in

22 which it performs any activity authorized under this Act.

23 The Corporation shall accept service of process addressed

24 by certified mail to the secretary of the Corporation at
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1 its principal office and place of business in Washington,

2 District of Columbia.

3 SEC. 13. DEFINITIONS.

4 For purposes of this Act:

5 (1) The term ‘‘Board’’ means the board of di6 rectors of the Civilian Technology Corporation.

7 (2) The term ‘‘Corporation’’ means the Civilian

8 Technology Corporation established under sections 2

9 and 3.

10 (3) The term ‘‘Fund’’ means the Civilian Tech11 nology Development Fund established by section 6.

12 (4) The term ‘‘panel’’ means the panel estab13 lished by section 8.

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