Calendar No. 561

103D CONGRESS

2D SESSION S. 2060

[Report No. 103–332]

A BILL

To amend the Small Business Act.

AUGUST 11, 1994

Reported with an amendment and an amendment to the

title
II

Calendar No. 561

103D CONGRESS

2D SESSION S. 2060

[Report No. 103–332]

To amend the Small Business Act.

IN THE SENATE OF THE UNITED STATES

MAY 3 (legislative day, MAY 2), 1994

Mr. BUMPERS (for himself, Mr. PRESSLER, Mr. NUNN, Mr. LEVIN, Mr. HARKIN, Mr. KERRY, Mr. LIEBERMAN, Mr. WELLSTONE, Mr. HEFLIN, Ms.

MOSELEY-BRAUN, and Mr. CHAFEE) (by request) introduced the following bill; which was read twice and referred to the Committee on Small

Business

AUGUST 11, 1994

Reported by Mr. BUMPERS, with an amendment and an amendment to the

title

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

A BILL

To amend the Small Business Act.

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

3 That this Act may be cited as the ‘‘Small Business Admin4 istration Amendments of 1994’’.
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1 TITLE I

2 SEC. 101. Section 7(m)(1)(B) of the Small Business

3 Act is amended by adding the words ‘‘, a lender or alliance

4 of lenders’’ after the word ‘‘Administration’’, and by add5 ing after the word ‘‘intermediaries’’ in clause (i) thereof

6 the following phrase ‘‘provided however, that the Adminis7 tration may make in its sole discretion up to 100 percent

8 deferred participation loans to ten intermediaries which

9 will be located in urban areas and ten intermediaries

10 which will be located in rural areas,’’.

11 SEC. 102. Section 7(m)(7) of the Small Business Act

12 is amended by deleting the number ‘‘50’’ from subpara13 graph (B) thereof, and replacing it with the number

14 ‘‘140’’, and by deleting the period at the end thereof and

15 adding the phrase ‘‘: Provided, That no more than 200

16 total microloan programs may be funded.’’, and by delet17 ing subparagraph (C) thereof and inserting in lieu thereof:

18 ‘‘(C) In no case shall a State receive more

19 than $5 million to fund all microloan programs

20 conducted in that State.’’

21 SEC. 103. Section 7(m)(3)(C) of the Small Business

22 Act is amended by replacing the number ‘‘$1,250,000’’

23 with the number ‘‘$1,750,000’’.

24 SEC. 104. Section 7(m)(3)(F) of the Small Business

25 Act is amended by adding after the phrase ‘‘10 years’’
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1 in clause (i) the following: ‘‘with the first five years of

2 any deferred participation loan being a revolving line of

3 credit on which only monthly payments of interest will be

4 required and the balance amortized over the second five

5 year period, with equal monthly payments of principal and

6 interest’’; and by revising clause (ii) to read as follows:

7 ‘‘(ii) APPLICABLE INTEREST RATES.—

8 Exception as provided in clause (iii), loans

9 made by the Administration under this

10 subsection to an intermediary shall bear an

11 interest rate equal to the rate of interest

12 on comparable five year obligations of the

13 United States Treasury.’’.

14 TITLE II

15 SEC. 201. Section 7(a)(2)(B)(iv) of the Small Busi16 ness Act is amended to read as follows:

17 ‘‘(iv) not more than 90 percent of the

18 financing outstanding at the time of dis19 bursement if such financing is an extension

20 or a revolving line of credit made under

21 paragraph (14) and not less than 90 per22 cent of the financing outstanding at the

23 time of disbursement if such financing is a

24 loan under paragraph (16).’’.
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1 SEC. 202. Section 7(a)(14) of the Small Business Act

2 is amended to read as follows:

3 ‘‘(14)(A) The Administration under this sub4 section may provide extensions, specifically including

5 guarantees of standby letters of credit and revolving

6 lines of credit for export purposes, and financings to

7 enable small business concerns, including small busi8 ness export trading companies and small business

9 export management companies, to develop foreign

10 markets. A bank or participating lending institution

11 may establish such rate of interest on extensions, re12 volving lines of credit and financings made under

13 this paragraph as may be legal and reasonable.’’.

14 SEC. 203. Section 7(a)(3)(B) of the Small Business

15 Act is amended to read as follows: ‘‘If the total amount

16 outstanding and committed (on a deferred basis) solely for

17 the purposes provided in paragraph (16) to the borrower

18 from the Business Guaranteed Loan Financing Account

19 established by this Act would exceed $1,000,000 such

20 amount to be in addition to any financing solely for work21 ing capital, supplies, or revolving lines of credit for export

22 purposes up to a maximum of $750,000: Provided, how23 ever, That in no event may be aggregate amount outstand24 ing and committed by the Administration under this sub25 section exceed $1,250,000.’’.
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1 TITLE III

2 SEC. 301. Sections 8(b) (2), (3) and (4) of the Small

3 Business Act are amended by inserting the words ‘‘and

4 other’’ after the word ‘‘small’’ wherever it appears.

5 TITLE IV

6 SEC. 401. Section 28[2](g) of the Small Business Act

7 is deleted and in its place the following is substituted:

8 ‘‘(g) There is established within the Administration

9 an Office of Women’s Business Ownership which shall be

10 responsible for the administration under the supervision

11 by the Administration of all authority conferred by this

12 section. Such Office shall be headed by a director who

13 shall be appointed by the Administrator.’’

14 TITLE V

15 SEC. 501. Section 8(b)(1)(A) of the Small Business

16 Act is amended by adding at the end thereof the following

17 sentence: ‘‘Notwithstanding any other provision of law, the

18 authority provided by this subparagraph shall remain

19 available until expressly repealed.’’

20 SEC. 502. Section 411(a)(3) of the Small Business

21 Investment Act of 1958 is amended by adding the follow22 ing sentence at the end thereof: ‘‘Notwithstanding any

23 other provision of law, the authority granted by this para24 graph shall remain available until expressly repealed.’’
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1 SEC. 503. Section 5(b)(8) of the Small Business Act

2 is amended by deleting the words ‘‘not in excess of six

3 months’’.

4 SEC. 504. The second sentence of Section 732 of

5 Public Law 100–656 is repealed.

6 SEC. 505. Section 4(c) of the Small Business Act is

7 amended to read as follows:

8 ‘‘(c)(1) There is hereby established in the Treasury

9 one Loan Liquidation Fund. All repayment of loans and

10 debentures, payments of interest, and other receipts aris11 ing out of transactions entered into by the Administration

12 pursuant to Sections 5(e), 5(g), 7(a), 7(b), 7(c)(2), 7(e),

13 7(h), 7(l), 7(m), and 8(a) of this Act, and titles III, IV,

14 and V of the Small Business Investment Act of 1958,

15 prior to October 1, 1991, shall be paid into such Loan

16 Fund Liquidating Account. Balances existing in those re17 volving funds, as in effect immediately prior to the effec18 tive date of this paragraph, shall be transferred into such

19 Loan Liquidation Fund. This Loan Liquidation Fund

20 shall have available, without fiscal year limitation, such

21 funds as are necessary to finance its operational needs.

22 ‘‘(2) The Administration shall submit to the Commit23 tees on Small Business and Appropriations of the Senate

24 and the House of Representatives, as soon as possible

25 after the beginning of each fiscal year, a full and complete
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1 report on the status of the Loan Liquidation Fund estab2 lished pursuant to paragraph (1).’’.

3 SEC. 506. Section 4(c)(5)(B)(ii) of the Small Busi4 ness Act is amended to read as follows:

5 ‘‘(ii) The Administration shall pay

6 into the miscellaneous receipts of the

7 Treasury following the close of each fiscal

8 year, the actual interest it collects during

9 that fiscal year on all financings made

10 under the authority of this Act.’’.

11 SEC. 507. Section 3(a)(2) of the Small Business Act

12 is amended to read as follows:

13 ‘‘(2) In addition to the criteria specified in

14 paragraph (1), the Administrator may specify de15 tailed definitions or standards for example, by num16 ber of employees or dollar volume of business, by

17 which a business concern is to be recognized as a

18 small business concern for the purposes of this Act

19 or any other Act. Unless specifically authorized by

20 statute, the Secretary of a department or the head

21 of a Federal agency, other than the Administrator of

22 the Small Business Administration, may not pre23 scribe for the use of such department or agency a

24 size standard for categorizing a business concern as
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1 a small business concern, unless such proposed size

2 standard—

3 ‘‘(A) is being proposed after an oppor4 tunity for public notice and comment;

5 ‘‘(B) provides for determining, over a pe6 riod of not less than 3 years—

7 ‘‘(i) the size of a manufacturing con8 cern as measured by its average employ9 ment based upon employment during each

10 of the concern’s pay periods for the preced11 ing completed twelve calendar months; or

12 ‘‘(ii) the size of a concern providing

13 services on basis of the annual average

14 gross receipts of the concern over a period

15 of not less than three years; and

16 ‘‘(C) is approved by the Administrator.

17 ‘‘(3) When establishing or approving any size

18 standard pursuant to paragraph (2), the Adminis19 trator shall consider variations in economic activity

20 from industry to industry unless the Administrator

21 determines that size standards should not vary in

22 order to meet program needs.’’.

23 SEC. 508. Section 5(b) of the Small Business Act is

24 amended by deleting the word ‘‘and’’ at the end of para25 graph (10) thereof, by removing the ‘‘.’’ at the end of
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1 paragraph (11) thereof and replacing it with ‘‘, and’’ and

2 (b) adding a new paragraph (12) which reads as follows:

3 ‘‘(12) to impose reasonable fees to be charged

4 in connection with applications for assistance, and

5 the provision of assistance under this Act and the

6 Small Business Investment Act of 1958 and to re7 tain such fees to offset the costs of administration

8 of such assistance.’’.

9 SEC. 509. Section 8(b) of the Small Business Act is

10 amended by deleting the word ‘‘and’’ at the end of para11 graph (15), by striking the period at the end of paragraph

12 8(b)(16) and replacing it with ‘‘; and’’, and by adding a

13 new paragraph 8(b)(17) which reads as follows:

14 ‘‘(17) to charge and collect such fees as may be

15 necessary to cover all costs associated with the pro16 duction and dissemination of compilations of infor17 mation produced by the Administration under the

18 authority of the Small Business Act and the Small

19 Business Investment Act of 1958, and to retain such

20 fees and utilize such fees to offset the costs of pro21 duction and dissemination of such compilations of

22 information.’’.
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1 TITLE VI

2 SEC. 601. Sections 20(k) through 20(p) of the Small

3 Business Act are repealed and the following is substituted

4 in their place:

5 ‘‘(k) The following program levels are authorized for

6 fiscal year 1995:

7 ‘‘(1) For the programs authorized by this Act,

8 the Administration is authorized to make

9 $13,910,000,000 in deferred participation loans and

10 other financings; and of such sum, the Administra11 tion is authorized to make $11,500,000,000 in gen12 eral business loans as provided in section 7(a),

13 $110,000,000 in loans as provided in section 7(m),

14 and $2,300,000,000 in financings as provided in sec15 tion 7(a)(13) and section 504 of the Small Business

16 Investment Act of 1958.

17 ‘‘(2) For the programs authorized by title III of

18 the Small Business Investment Act of 1958, the Ad19 ministration is authorized to make $23,000,000 in

20 purchases of preferred stock, $275,000,000 in guar21 antees of debentures of which $65,000,000 is au22 thorized for guarantees of debentures of companies

23 operating pursuant to section 301(d) of such Act,

24 and $550,000,000 in guarantees of participating

25 securities.
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1 ‘‘(3) For the programs authorized by part B of

2 title IV of the Small Business Investment Act of

3 1958, the Administration is authorized to enter into

4 guarantees not to exceed $2,000,000,000.

5 ‘‘(l) There are authorized to be appropriated to the

6 Administration for fiscal year 1995 such sums as may be

7 necessary to carry out subsection (k), including salaries

8 and expenses of the Administration.

9 ‘‘(m) The following program levels are authorized for

10 fiscal year 1996:

11 ‘‘(1) For the programs authorized by this Act,

12 the Administration is authorized to make

13 $17,475,000,000 in deferred participation loans and

14 other financings; and of such sum, the Administra15 tion is authorized to make $13,500,000,000 in gen16 eral business loans as provided in section 7(a),

17 $175,000,000 in loans as provided in section 7(m),

18 and $3,800,000,000 in financings as provided in sec19 tion 7(a)(13) and section 504 of the Small Business

20 Investment Act of 1958.

21 ‘‘(2) For the programs authorized by title III of

22 the Small Business Investment Act of 1958, the Ad23 ministration is authorized to make $24,000,000 in

24 purchases of preferred stock, $320,000,000 in guar25 antees of debentures of which $70,000,000 is au-
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1 thorized for guarantees of debentures of companies

2 operating pursuant to section 301(d) of such Act,

3 and $1,100,000,000 in guarantees of participating

4 securities.

5 ‘‘(3) For the programs authorized by part B of

6 title IV of the Small Business Investment Act of

7 1958, the Administration is authorized to enter into

8 guarantees not to exceed $2,000,000,000.

9 ‘‘(n) There are authorized to be appropriated to the

10 Administration for fiscal year 1996, such sums as may

11 be necessary to carry out subsection (m), including sala12 ries and expenses of the Administration.

13 ‘‘(o) The following program levels are authorized for

14 fiscal year 1997:

15 ‘‘(1) For the programs authorized by this Act,

16 the Administration is authorized to make

17 $21,450,000,000 in deferred participation loans and

18 other financings; and of such sum, the Administra19 tion is authorized to make $15,500,000,000 in gen20 eral business loans as provided in section 7(a),

21 $250,000,000 in loans as provided in section 7(m),

22 and $5,700,000,000 in financings as provided in sec23 tion 7(a)(13) and section 504 of the Small Business

24 Investment act of 1958.
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1 ‘‘(2) For the programs authorized by title III of

2 the Small Business Investment Act of 1958, the Ad3 ministration is authorized to make $25,000,000 in

4 purchases of deferred stock, $385,000,000 in guar5 antees of debentures of which $75,500,000 is au6 thorized for guarantees of debentures of companies

7 operating pursuant to section 301(d) of such Act,

8 and $1,700,000,000 in guarantees of participating

9 securities.

10 ‘‘(3) For the programs authorized by part B of

11 title IV of the Small Business Investment Act of

12 1958, the Administration is authorized to enter into

13 guarantees not to exceed $2,000,000,000.

14 ‘‘(p) There are authorized to be appropriated to the

15 Administration for fiscal year 1997, such sums as may

16 be necessary to carry out subsection (o), including salaries

17 and expenses of the Administration.’’.

18 SECTION 1. SHORT TITLE; TABLE OF CONTENTS.

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

20 ‘‘Small Business Administration Reauthorization and

21 Amendment Act of 1994’’.

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

23 this Act is as follows:

Sec. 1. Short title; table of contents.

TITLE I—AUTHORIZATIONS

Sec. 101. Authorizations.
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TITLE II—FINANCIAL ASSISTANCE PROGRAMS

Sec. 201. Microloan financing pilot.

Sec. 202. Eligibility of Native American tribal governments to be microloan

intermediaries.

Sec. 203. Microloan program extension.

Sec. 204. Microloan program funding and State limitations.

Sec. 205. Distribution of intermediaries.

Sec. 206. Microloan intermediary loan limitation.

Sec. 207. Microloan technical assistance to nonborrowers.

Sec. 208. Microloan demonstration program grants.

Sec. 209. Eligibility to participate as a microloan intermediary and a technical

assistance provider.

Sec. 210. Loans to exporters.

Sec. 211. Working capital international trade loans.

Sec. 212. Guarantees on international trade loans.

Sec. 213. Accredited lenders program.

Sec. 214. Interest rate on certified development company loans.

Sec. 215. Certifications of eligibility for SBIC and SSBIC financing.

Sec. 216. Participating securities for smaller SBICs.

TITLE III—SIZE STANDARDS AND BOND GUARANTEES

Sec. 301. Size standard criteria.

Sec. 302. Sunset on preferred surety bond guarantee program.

Sec. 303. Manufacturing contracts through manufacturing application and education centers.

TITLE IV—BUSINESS DEVELOPMENT ASSISTANCE

Subtitle A—General Provisions

Sec. 401. Sunset on cosponsored training.

Sec. 402. Small business development center program level.

Sec. 403. Federal contracts with small business development centers.

Sec. 404. Small business development center program examination and certification.

Sec. 405. Service Corps of Retired Executives (SCORE) program.

Sec. 406. Information concerning franchising.

Subtitle B—Development of Woman-Owned Businesses

Sec. 411. Extension of authority for demonstration projects.

Sec. 412. Establishment of Office of Women’s Business Ownership.

Sec. 413. National Commission on Women in Business.

TITLE V—RELIEF FROM DEBENTURE PREPAYMENT PENALTIES

Sec. 501. Short title.

Sec. 502. Prepayment of development company debentures.

TITLE VI—MISCELLANEOUS AMENDMENTS

Sec. 601. Consolidation of funding accounts.

Sec. 602. Imposition of fees.

Sec. 603. Job creation and community benefit.

Sec. 604. Microloan program amendments.

Sec. 605. Technical clarification.
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Sec. 606. Secondary market study due date.

Sec. 607. Study and data base: Guaranteed Business Loan Program and Development Company Program.

Sec. 608. SBIR vendors.

Sec. 609. Program extension.

Sec. 610. Prohibition on the use of funds for individuals not lawfully within the

United States.

Sec. 611. Office of advocacy employees.

Sec. 612. Prohibition on the provision of assistance.

Sec. 613. Certification of compliance with child support obligations.

1 TITLE I—AUTHORIZATIONS

2 SEC. 101. AUTHORIZATIONS.

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

4 note) is amended by striking subsections (k) (as added by

5 section 405(3) of the Small Business Credit and Business

6 Opportunity Enhancement Act of 1992) through (p) and

7 inserting the following:

8 ‘‘(l) The following program levels are authorized for

9 fiscal year 1995:

10 ‘‘(1) For the programs authorized by this Act,

11 the Administration is authorized to make

12 $110,000,000 in direct and immediate participation

13 loans, and $45,000,000 in technical assistance grants

14 as provided in section 7(m).

15 ‘‘(2) For the programs authorized by this Act,

16 the Administration is authorized to make

17 $13,315,000,000 in deferred participation loans and

18 other financings. Of such sum, the Administration is

19 authorized to make—
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1 ‘‘(A) $9,000,000,000 in general business

2 loans as provided in section 7(a);

3 ‘‘(B) $2,300,000,000 in financings as pro4 vided in section 7(a)(13) and section 504 of the

5 Small Business Investment Act of 1958;

6 ‘‘(C) $2,000,000,000 in loans as provided in

7 section 7(a)(21); and

8 ‘‘(D) $15,000,000 in loans as provided in

9 section 7(m).

10 ‘‘(3) For the programs authorized by title III of

11 the Small Business Investment Act of 1958, the Ad12 ministration is authorized to make—

13 ‘‘(A) $33,000,000 in purchases of preferred

14 securities;

15 ‘‘(B) $275,000,000 in guarantees of deben16 tures, of which $65,000,000 is authorized in

17 guarantees of debentures from companies operat18 ing pursuant to section 301(d) of such Act; and

19 ‘‘(C) $500,000,000 in guarantees of partici20 pating securities.

21 ‘‘(4) For the programs authorized by part B of

22 title IV of the Small Business Investment Act of 1958,

23 the Administration is authorized to enter into guar24 antees not to exceed $1,800,000,000, of which not

25 more than $450,000,000 may be in bonds approved
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1 pursuant to the provisions of section 411(a)(3) of such

2 Act.

3 ‘‘(5) The Administration is authorized to make

4 grants or enter into cooperative agreements—

5 ‘‘(A) for the Service Corps of Retired Execu6 tives program authorized by section 8(b)(1),

7 $3,500,000;

8 ‘‘(B) for the Small Business Institute pro9 gram authorized by section 8(b)(1), $3,000,000;

10 and

11 ‘‘(C) for activities of small business develop12 ment centers pursuant to section 21(c)(3)(G),

13 $25,000,000, to remain available until expended.

14 ‘‘(m) There are authorized to be appropriated to the

15 Administration for fiscal year 1995 such sums as may be

16 necessary to carry out the provisions of this Act, including

17 administrative expenses and necessary loan capital for dis18 aster loans pursuant to section 7(b), and to carry out the

19 provisions of the Small Business Investment Act of 1958,

20 including salaries and expenses of the Administration.

21 ‘‘(n) The following program levels are authorized for

22 fiscal year 1996:

23 ‘‘(1) For the programs authorized by this Act,

24 the Administration is authorized to make

25 $175,000,000 in direct and immediate participation
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1 loans, and $65,000,000 in technical assistance grants

2 as provided in section 7(m).

3 ‘‘(2) For the programs authorized by this Act,

4 the Administration is authorized to make

5 $15,320,000,000 in deferred participation loans and

6 other financings. Of such sum, the Administration is

7 authorized to make—

8 ‘‘(A) $10,000,000,000 in general business

9 loans as provided in section 7(a);

10 ‘‘(B) $2,800,000,000 in financings as pro11 vided in section 7(a)(13) and section 504 of the

12 Small Business Investment Act of 1958;

13 ‘‘(C) $2,500,000,000 in loans as provided in

14 section 7(a)(21); and

15 ‘‘(D) $20,000,000 in loans as provided in

16 section 7(m).

17 ‘‘(3) For the programs authorized by title III of

18 the Small Business Investment Act of 1958, the Ad19 ministration is authorized to make—

20 ‘‘(A) $39,000,000 in purchases of preferred

21 securities;

22 ‘‘(B) $300,000,000 in guarantees of deben23 tures, of which $70,000,000 is authorized in

24 guarantees of debentures from companies operat25 ing pursuant to section 301(d) of such Act; and
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1 ‘‘(C) $750,000,000 in guarantees of partici2 pating securities.

3 ‘‘(4) For the programs authorized by part B of

4 title IV of the Small Business Investment Act of 1958,

5 the Administration is authorized to enter into guar6 antees not to exceed $2,000,000,000, of which not

7 more than $500,000,000 may be in bonds approved

8 pursuant to the provisions of section 411(a)(3) of such

9 Act.

10 ‘‘(5) The Administration is authorized to make

11 grants or enter cooperative agreements—

12 ‘‘(A) for the Service Corps of Retired Execu13 tives program authorized by section 8(b)(1),

14 $3,750,000;

15 ‘‘(B) for the small business institute pro16 gram authorized by section 8(b)(1), $3,250,000;

17 and

18 ‘‘(C) for activities of small business develop19 ment centers pursuant to section 21(c)(3)(G), not

20 to exceed $25,000,000, to remain available until

21 expended.

22 ‘‘(o) There are authorized to be appropriated to the Ad23 ministration for fiscal year 1996 such sums as may be nec24 essary to carry out the provisions of this Act, including ad25 ministrative expenses and necessary loan capital for disas-
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1 ter loans pursuant to section 7(b), and to carry out the pro2 visions of the Small Business Investment Act of 1958, in3 cluding salaries and expenses of the Administration.

4 ‘‘(p) The following program levels are authorized for

5 fiscal year 1997:

6 ‘‘(1) For the programs authorized by this Act,

7 the Administration is authorized to make

8 $250,000,000 in direct and immediate participation

9 loans and $98,000,000 in technical assistance grants

10 as provided in section 7(m), to remain available until

11 expended.

12 ‘‘(2) For the programs authorized by this Act,

13 the Administration is authorized to make

14 $19,020,000,000 in deferred participation loans and

15 other financings. Of such sum, the Administration is

16 authorized to make—

17 ‘‘(A) $12,000,000,000 in general business

18 loans as provided in section 7(a);

19 ‘‘(B) $3,500,000,000 in financings as pro20 vided in section 7(a)(13) and section 504 of the

21 Small Business Investment Act of 1958;

22 ‘‘(C) $3,500,000,000 in loans as provided in

23 section 7(a)(21); and

24 ‘‘(D) $20,000,000 in loans as provided in

25 section 7(m).
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1 ‘‘(3) For the programs authorized by title III of

2 the Small Business Investment Act of 1958, the Ad3 ministration is authorized to make—

4 ‘‘(A) $45,000,000 in purchases of preferred

5 securities;

6 ‘‘(B) $375,000,000 in guarantees of deben7 tures, of which $75,000,000 is authorized in

8 guarantees of debentures from companies operat9 ing pursuant to section 301(d) of such Act; and

10 ‘‘(C) $1,125,000,000 in guarantees of par11 ticipating securities.

12 ‘‘(4) For the programs authorized by part B of

13 title IV of the Small Business Investment Act of 1958,

14 the Administration is authorized to enter into guar15 antees not to exceed $2,200,000,000, of which not

16 more than $650,000,000 may be in bonds approved

17 pursuant to the provisions of section 411(a)(3) of such

18 Act.

19 ‘‘(5) The Administration is authorized to make

20 grants or enter cooperative agreements—

21 ‘‘(A) for the Service Corps of Retired Execu22 tives program authorized by section 8(b)(1),

23 $4,000,000;
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1 ‘‘(B) for the small business institute pro2 gram authorized by section 8(b)(1), $3,500,000;

3 and

4 ‘‘(C) for activities of small business develop5 ment centers pursuant to section 21(c)(3)(G), not

6 to exceed $25,000,000, to remain available until

7 expended.

8 ‘‘(q) There are authorized to be appropriated to the

9 Administration for fiscal year 1997 such sums as may be

10 necessary to carry out the provisions of this Act, including

11 administrative expenses and necessary loan capital for dis12 aster loans pursuant to section 7(b), and to carry out the

13 provisions of the Small Business Investment Act of 1958,

14 including salaries and expenses of the Administration.’’.

15 TITLE II—FINANCIAL

16 ASSISTANCE PROGRAMS

17 SEC. 201. MICROLOAN FINANCING PILOT.

18 Section 7(m) of the Small Business Act (15 U.S.C.

19 636(m)) is amended by adding at the end the following new

20 paragraph:

21 ‘‘(12) DEFERRED PARTICIPATION LOAN PILOT.—

22 In lieu of making direct loans to intermediaries as

23 authorized in paragraph (1)(B), during fiscal years

24 1995 through 1997, the Administration may, on a

25 pilot program basis, participate on a deferred basis
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1 of not less than 90 percent and not more than 100

2 percent on loans made to intermediaries by a for3 profit or nonprofit entity or by alliances of such enti4 ties, subject to the following conditions:

5 ‘‘(A) NUMBER OF LOANS.—In carrying out

6 this paragraph, the Administration shall not

7 participate in providing financing on a deferred

8 basis to more than 10 intermediaries in urban

9 areas or more than 10 intermediaries in rural

10 areas.

11 ‘‘(B) TERM OF LOANS.—The term of each

12 loan shall be 10 years. During the first year of

13 the loan, the intermediary shall not be required

14 to repay any interest or principal. During the

15 second through fifth years of the loan, the

16 intermediary shall be required to pay interest

17 only. During the sixth through tenth years of the

18 loan, the intermediary shall be required to make

19 interest payments and fully amortize the prin20 cipal.

21 ‘‘(C) INTEREST RATE.—The interest rate on

22 each loan shall be the rate specified by para23 graph (3)(F) for direct loans. Subject to the

24 availability of appropriations, the Administra25 tion may make payments to lenders on behalf of
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1 intermediaries in order to achieve such interest

2 rate.’’.

3 SEC. 202. ELIGIBILITY OF NATIVE AMERICAN TRIBAL GOV4 ERNMENTS TO BE MICROLOAN

5 INTERMEDIARIES.

6 Section 7(m)(11)(A) of the Small Business Act (15

7 U.S.C. 636(m)(11)(A)) is amended—

8 (1) in clause (iii), by striking ‘‘or’’ at the end;

9 (2) in clause (iv), by striking the comma at the

10 end and inserting ‘‘; or’’; and

11 (3) by adding at the end the following new

12 clause:

13 ‘‘(v) an agency of or nonprofit entity

14 established by a Native American Tribal

15 Government,’’.

16 SEC. 203. MICROLOAN PROGRAM EXTENSION.

17 Section 609(j) of Public Law 102–140 (105 Stat. 831)

18 is amended by striking ‘‘5 years after the date of enactment

19 of this Act’’, and inserting ‘‘on October 1, 1998’’.

20 SEC. 204. MICROLOAN PROGRAM FUNDING AND STATE LIMI21 TATIONS.

22 Section 7(m) of the Small Business Act (15 U.S.C.

23 636(m)) is amended—

24 (1) in paragraph (5)(A)—
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1 (A) by striking ‘‘25 grants’’ and inserting

2 ‘‘50 grants’’; and

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

4 ‘‘$150,000’’; and

5 (2) by striking paragraph (7) and inserting the

6 following:

7 ‘‘(7) PROGRAM FUNDING FOR MICROLOANS.—

8 ‘‘(A) NUMBER OF PARTICIPANTS.—In carry9 ing out paragraph (1)(B)(i), the Administration

10 may fund, on a competitive basis, not more

11 than—

12 ‘‘(i) 150 microloan programs in fiscal

13 year 1995; and

14 ‘‘(ii) 200 microloan programs in each

15 succeeding fiscal year.

16 ‘‘(B) STATE LIMITATIONS.—A State shall

17 not receive more than $10,000,000 in loan funds

18 during any year of program participation.’’.

19 SEC. 205. DISTRIBUTION OF INTERMEDIARIES.

20 Section 7(m)(8) of the Small Business Act (15 U.S.C.

21 636(m)(8)) is amended to read as follows:

22 ‘‘(8) DISTRIBUTION OF INTERMEDIARIES.—In

23 approving microloan program applicants under this

24 subsection, the Administration shall select such

25 intermediaries as will further microloan availability
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1 for small businesses in all industries located through2 out each State, especially small businesses located in

3 economically distressed urban and rural areas.’’.

4 SEC. 206. MICROLOAN INTERMEDIARY LOAN LIMITATION.

5 Section 7(m)(3)(C) of the Small Business Act (15

6 U.S.C. 636(m)(3)(C)) is amended by striking ‘‘$1,250,000’’

7 and inserting ‘‘$2,000,000’’.

8 SEC. 207. MICROLOAN TECHNICAL ASSISTANCE TO

9 NONBORROWERS.

10 Section 7(m)(4) of the Small Business Act (15 U.S.C.

11 636(m)(4)) is amended by adding at the end the following

12 new subparagraph:

13 ‘‘(E) ASSISTANCE TO CERTAIN SMALL BUSI14 NESS CONCERNS.—Each intermediary may ex15 pend an amount not to exceed 20 percent of the

16 grant funds authorized under paragraph

17 (1)(B)(ii) to provide marketing, management,

18 and technical assistance to small business con19 cerns that are not borrowers under this sub20 section.’’.

21 SEC. 208. MICROLOAN DEMONSTRATION PROGRAM GRANTS.

22 Section 7(m)(4) of the Small Business Act (15 U.S.C.

23 636(m)(4)) is amended—

24 (1) in subparagraph (B), by inserting ‘‘except

25 for a grant made to an intermediary that provides
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1 not less than 50 percent of its loans to small business

2 concerns owned by one or more members of a federally

3 recognized Indian tribe,’’ after ‘‘under subparagraph

4 (A),’’; and

5 (2) in subparagraph (C), by striking clause (i)

6 and inserting the following:

7 ‘‘(i) IN GENERAL.—In addition to

8 grants made under subparagraph (A), each

9 intermediary shall be eligible to receive a

10 grant equal to 5 percent of the total out11 standing balance of loans made to the

12 intermediary under this subsection if—

13 ‘‘(I) the intermediary provides not

14 less than 25 percent of its loans to

15 small business concerns owned by one

16 or more members of a federally recog17 nized Indian tribe; or

18 ‘‘(II) the intermediary has a port19 folio of loans made under this sub20 section that averages not more than

21 $7,500 during the period of the

22 intermediary’s participation in the

23 program.’’.
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1 SEC. 209. ELIGIBILITY TO PARTICIPATE AS A MICROLOAN

2 INTERMEDIARY AND A TECHNICAL ASSIST3 ANCE PROVIDER.

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

5 636(m)(2)) is amended—

6 (1) by striking ‘‘(2) ELIGIBILITY FOR PARTICIPA7 TION.—An’’ and inserting the following:

8 ‘‘(2) ELIGIBILITY FOR PARTICIPATION.—

9 ‘‘(A) IN GENERAL.—An’’;

10 (2) by redesignating subparagraphs (A) and (B)

11 as clauses (i) and (ii), respectively, and indenting ac12 cordingly; and

13 (3) by adding at the end the following new sub14 paragraph:

15 ‘‘(B) PARTICIPATION AS INTERMEDIARY AND

16 TECHNICAL ASSISTANCE PROVIDER.—A single

17 entity may simultaneously receive 1 grant as an

18 intermediary pursuant to paragraph (1)(B)(ii)

19 and 1 grant as a nonintermediary technical as20 sistance provider pursuant to paragraph

21 (1)(B)(iii) if the Administration determines

22 that—

23 ‘‘(i) the purposes of the grants are not

24 duplicative;

25 ‘‘(ii) the grants will enable the entity

26 to provide technical assistance to different
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1 geographic areas, or to support both guar2 anteed and direct loans in the same geo3 graphic area; and

4 ‘‘(iii) the entity meets all of the re5 quirements of the programs authorized pur6 suant to clauses (ii) and (iii) of paragraph

7 (1)(B).’’.

8 SEC. 210. LOANS TO EXPORTERS.

9 Section 7(a)(14)(A) of the Small Business Act (15

10 U.S.C. 636(a)(14)(A)) is amended to read as follows:

11 ‘‘(14)(A) The Administration may provide exten12 sions of credit, standby letters of credit, revolving

13 lines of credit for export purposes, and other financ14 ing to enable small business concerns, including small

15 business export trading companies and small business

16 export management companies, to develop foreign

17 markets. A bank or participating lending institution

18 may establish the rate of interest on such financings

19 as may be legal and reasonable.’’.

20 SEC. 211. WORKING CAPITAL INTERNATIONAL TRADE

21 LOANS.

22 Section 7(a)(3)(B) of the Small Business Act (15

23 U.S.C. 636(a)(3)(B)) is amended to read as follows:

24 ‘‘(B) if the total amount outstanding and

25 committed (on a deferred basis) solely for the
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1 purposes provided in paragraph (16) to the bor2 rower from the business loan and investment

3 fund established by this Act would exceed

4 $1,250,000, of which not more than $750,000

5 may be used for working capital, supplies, or

6 financings under section 7(a)(14) for export pur7 poses; and’’.

8 SEC. 212. GUARANTEES ON INTERNATIONAL TRADE LOANS.

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

10 U.S.C. 636(a)(2)(B)(iv)) is amended to read as follows:

11 ‘‘(iv) not less than 85 percent nor more

12 than 90 percent of the financing outstand13 ing at the time of disbursement if such fi14 nancing is a loan under paragraph (14) or

15 (16).’’.

16 SEC. 213. ACCREDITED LENDERS PROGRAM.

17 (a) ESTABLISHMENT.—Title V of the Small Business

18 Investment Act of 1958 (15 U.S.C. 695 et seq.) is amended

19 by adding at the end the following new section:

20 ‘‘SEC. 507. ACCREDITED LENDERS PROGRAM.

21 ‘‘(a) ESTABLISHMENT.—The Administration is au22 thorized to establish an Accredited Lenders Program for

23 qualified State and local development companies that meet

24 the requirements of subsection (b).
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1 ‘‘(b) REQUIREMENTS.—The Administration may des2 ignate a qualified State or local development company as

3 an accredited lender if such company—

4 ‘‘(1) has been an active participant in the Devel5 opment Company Program authorized by sections

6 502, 503, and 504 for not less than the preceding 12

7 months;

8 ‘‘(2) has well-trained, qualified personnel who

9 are knowledgeable in the Administration’s lending

10 policies and procedures for such Development Com11 pany Program;

12 ‘‘(3) has the ability to process, close, and service

13 financing for plant and equipment under such Devel14 opment Company Program;

15 ‘‘(4) has a reasonable and acceptable loss rate on

16 the company’s debentures;

17 ‘‘(5) has a history of submitting to the Adminis18 tration complete and accurate debenture guaranty ap19 plication packages; and

20 ‘‘(6) has demonstrated the ability to serve small

21 business credit needs for financing plant and equip22 ment through the Development Company Program

23 authorized by sections 502, 503, and 504.

24 ‘‘(c) EXPEDITED PROCESSING OF LOAN APPLICA25 TIONS.—The Administration shall develop an expedited
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1 procedure for processing a loan application or servicing ac2 tion submitted by a qualified State or local development

3 company that has been designated as an accredited lender

4 in accordance with subsection (b).

5 ‘‘(d) SUSPENSION OR REVOCATION OF DESIGNA6 TION.—

7 ‘‘(1) IN GENERAL.—The designation of a quali8 fied State or local development company as an ac9 credited lender may be suspended or revoked if the

10 Administration determines that—

11 ‘‘(A) the development company has not con12 tinued to meet the criteria for eligibility under

13 subsection (b); or

14 ‘‘(B) the development company has failed to

15 adhere to the Administration’s rules and regula16 tions or is violating any other applicable provi17 sion of law.

18 ‘‘(2) EFFECT.—A suspension or revocation under

19 paragraph (1) shall not affect any outstanding deben20 ture guarantee.

21 ‘‘(e) DEFINITION.—For purposes of this section, the

22 term ‘qualified State or local development company’ has the

23 same meaning as in section 503(e).’’.
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1 (b) REGULATIONS.—Not later than 120 days after the

2 date of enactment of this Act, the Administration shall pro3 mulgate final regulations to carry out this section.

4 (c) REPORT.—Not later than 1 year after the effective

5 date of regulations promulgated under subsection (b), the

6 Administration shall report to the Committees on Small

7 Business of the Senate and the House of Representatives

8 on the implementation of this section. Such report shall in9 clude data on the number of development companies des10 ignated as accredited lenders, their debenture guarantee vol11 ume, their loss rates, the average processing time on their

12 guarantee applications, and such other information as the

13 Administration deems appropriate.

14 SEC. 214. INTEREST RATE ON CERTIFIED DEVELOPMENT

15 COMPANY LOANS.

16 Section 112(c) of the Small Business Administration

17 Reauthorization and Amendment Act of 1988 (102 Stat.

18 2996) is amended—

19 (1) in paragraph (1), by striking ‘‘(1) IN GEN20 ERAL.—Section 503’’ and inserting ‘‘Section 503’’;

21 and

22 (2) by striking paragraph (2).
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1 SEC. 215. CERTIFICATIONS OF ELIGIBILITY FOR SBIC AND

2 SSBIC FINANCING.

3 Section 308 of the Small Business Investment Act of

4 1958 (15 U.S.C. 687) is amended by adding at the end the

5 following new subsection:

6 ‘‘(h) CERTIFICATIONS OF ELIGIBILITY.—

7 ‘‘(1) CERTIFICATION BY SMALL BUSINESS CON8 CERN.—Prior to receiving financial assistance from a

9 company licensed pursuant to subsection (c) or (d) of

10 section 301, a small business concern shall certify in

11 writing that it meets the eligibility requirements of

12 the Small Business Investment Company Program or

13 the Specialized Small Business Investment Company

14 Program, as applicable.

15 ‘‘(2) CERTIFICATION BY COMPANY.—Prior to pro16 viding financial assistance to a small business con17 cern under this Act, a company licensed pursuant to

18 subsection (c) or (d) of section 301 shall certify in

19 writing that it has reviewed the application for as20 sistance of the small business concern and that all

21 documentation and other information supports the

22 eligibility of the applicant.

23 ‘‘(3) RETENTION OF CERTIFICATIONS.—Certifi24 cates made pursuant to paragraphs (1) and (2) shall

25 be retained by the company licensed pursuant to sub-
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1 section (c) or (d) of section 301 for the duration of

2 the financial assistance.’’.

3 SEC. 216. PARTICIPATING SECURITIES FOR SMALLER SBICS.

4 Section 303(g) of the Small Business Investment Act

5 of 1958 (15 U.S.C. 683(g)) is amended by adding at the

6 end the following new paragraph:

7 ‘‘(13) PARTICIPATING SECURITIES FOR SMALLER

8 SMALL BUSINESS INVESTMENT COMPANIES.—

9 ‘‘(A) IN GENERAL.—Subject to the provi10 sions of subparagraph (B), of the amount of the

11 annual program level of participating securities

12 approved in appropriations Acts, 50 percent

13 shall be reserved for funding small business in14 vestment companies with private capital of less

15 than $20,000,000.

16 ‘‘(B) EXCEPTION.—During the last quarter

17 of each fiscal year, if the Administrator deter18 mines that there is a lack of qualified applicants

19 with private capital of less than $20,000,000, the

20 Administrator may utilize all or any part of the

21 program level for securities reserved under sub22 paragraph (A) for qualified applicants with pri23 vate capital of $20,000,000 or more.’’.
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1 TITLE III—SIZE STANDARDS AND

2 BOND GUARANTEES

3 SEC. 301. SIZE STANDARD CRITERIA.

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

5 632(a)(2)) is amended to read as follows:

6 ‘‘(2) SIZE STANDARD CRITERIA.—

7 ‘‘(A) IN GENERAL.—In addition to the cri8 teria specified in paragraph (1), the Adminis9 trator may specify detailed definitions or stand10 ards by which a business concern may be deter11 mined to be a small business concern for the pur12 poses of this Act or any other Act.

13 ‘‘(B) ADDITIONAL CRITERIA.—The stand14 ards described in paragraph (1) may utilize

15 number of employees, dollar volume of business,

16 net worth, net income, or a combination thereof.

17 ‘‘(C) REQUIREMENTS.—Unless specifically

18 authorized by statute, no Federal department or

19 agency may prescribe a size standard for cat20 egorizing a business concern as a small business

21 concern, unless such proposed size standard—

22 ‘‘(i) is proposed after an opportunity

23 for public notice and comment;

24 ‘‘(ii) provides for determining—
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1 ‘‘(I) the size of a manufacturing

2 concern as measured by the manufac3 turing concern’s average employment

4 based upon employment during each of

5 the manufacturing concern’s pay peri6 ods for the preceding 12 months;

7 ‘‘(II) the size of a business concern

8 providing services on the basis of the

9 annual average gross receipts of the

10 business concern over a period of not

11 less than 3 years; and

12 ‘‘(III) the size of other business

13 concerns on the basis of data over a pe14 riod of not less than 3 years; and

15 ‘‘(iii) is approved by the Adminis16 trator.’’.

17 SEC. 302. SUNSET ON PREFERRED SURETY BOND GUARAN18 TEE PROGRAM.

19 Section 207 of the Small Business Administration Re20 authorization and Amendment Act of 1988 (15 U.S.C. 694b

21 note) is amended by striking ‘‘September 30, 1994’’ and in22 serting ‘‘September 30, 1995’’.
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1 SEC. 303. MANUFACTURING CONTRACTS THROUGH MANU2 FACTURING APPLICATION AND EDUCATION

3 CENTERS.

4 (a) IN GENERAL.—The Small Business Administra5 tion shall promote the award of Federal manufacturing con6 tracts to small business concerns that participate in manu7 facturing application and education centers by working

8 with the Department of Commerce and other agencies to

9 identify components and subsystems that are both critical

10 and currently foreign-sourced.

11 (b) QUALIFICATIONS.—In order to qualify as a manu12 facturing application and education center under this sec13 tion, an entity shall have the capacity to assist small busi14 ness concerns in a shared-use production environment and

15 to offer the following services:

16 (1) Technology demonstration.

17 (2) Technology education.

18 (3) Technology application support.

19 (4) Technology advancement support.

20 (c) INAPPLICABILITY OF CERTAIN REQUIREMENTS.—

21 The requirements of section 15(o)(1)(B) of the Small Busi22 ness Act shall not apply with respect to any manufacturing

23 contract carried out by a small business concern in conjunc24 tion with a manufacturing application and education cen25 ter under this section.
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1 (d) REGULATIONS.—Not later than 180 days after the

2 date of enactment of this Act, the Administrator of the

3 Small Business Administration shall promulgate final reg4 ulations to carry out this section.

5 (e) TERMINATION OF AUTHORITY.—The authority of

6 the Small Business Administration under this section shall

7 terminate on September 30, 1997.

8 TITLE IV—BUSINESS

9 DEVELOPMENT ASSISTANCE

10 Subtitle A—General Provisions

11 SEC. 401. SUNSET ON COSPONSORED TRAINING.

12 (a) IN GENERAL.—

13 (1) REPEAL.—The amendments made by section

14 5(a) of Small Business Computer Security and Edu15 cation Act of 1984 (15 U.S.C. 633 note) are hereby

16 repealed.

17 (2) EFFECTIVE DATE.—Paragraph (1) shall take

18 effect on September 30, 1997.

19 (b) CONFORMING AMENDMENT.—Section 7(b) of the

20 Small Business Computer Security and Education Act of

21 1984 (15 U.S.C. 633 note) is amended in the second sen22 tence by striking ‘‘and the amendments made to section

23 8(b)(1)(A) of the Small Business Act by section 5(a)(2) of

24 this Act are’’ and inserting ‘‘is’’.
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1 SEC. 402. SMALL BUSINESS DEVELOPMENT CENTER PRO2 GRAM LEVEL.

3 Section 21(a)(4) of the Small Business Act (15 U.S.C.

4 648(a)(4)) is amended to read as follows:

5 ‘‘(4) SMALL BUSINESS DEVELOPMENT CENTER PRO6 GRAM LEVEL.—

7 ‘‘(A) IN GENERAL.—The Administration shall re8 quire as a condition of any grant (or amendment or

9 modification thereof) made to an applicant under this

10 section, that a matching amount (excluding any fees

11 collected from recipients of such assistance) equal to

12 the amount of such grant be provided from sources

13 other than the Federal Government, to be comprised

14 of not less than 50 percent cash and not more than

15 50 percent of indirect costs and in-kind contributions.

16 ‘‘(B) RESTRICTION.—The matching amount de17 scribed in subparagraph (A) shall not include any in18 direct costs or in-kind contributions derived from any

19 Federal program.

20 ‘‘(C) NATIONAL PROGRAM.—

21 ‘‘(i) IN GENERAL.—No recipient of funds

22 under this section shall receive a grant that ex23 ceeds—

24 ‘‘(I) for fiscal year 1995, the greater

25 of—
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1 ‘‘(aa) the sum of such recipient’s

2 pro rata share of a national program

3 based upon the population to be served

4 by the small business development cen5 ter as compared to the total population

6 in the United States, and $100,000; or

7 ‘‘(bb) $200,000; and

8 ‘‘(II) except as provided in clause (ii),

9 in each succeeding fiscal year, the greater

10 of—

11 ‘‘(aa) the sum of such recipient’s

12 pro rata share of a national program

13 based upon the population to be served

14 by the small business development cen15 ter as compared to the total population

16 in the United States, and $200,000; or

17 ‘‘(bb) $300,000.

18 ‘‘(ii) EXCEPTION.—The provisions of clause

19 (i)(I) shall apply in any fiscal year after fiscal

20 year 1995 in which, based on funds appro21 priated, a small business development center

22 would, under the provisions of clause (i)(II), re23 ceive less than the small business development

24 center received in fiscal year 1995.
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1 ‘‘(iii) AMOUNT.—The amount of the na2 tional program shall be—

3 ‘‘(I) $70,000,000 through September

4 30, 1995;

5 ‘‘(II) $77,500,000 from October 1, 1995

6 through September 30, 1996; and

7 ‘‘(III) $85,000,000 beginning October

8 1, 1996.

9 The amount for which a small business develop10 ment center is eligible under this paragraph

11 shall be based upon the amount of the national

12 program in effect as of the date for commence13 ment of performance of the small business devel14 opment center’s grant.’’.

15 SEC. 403. FEDERAL CONTRACTS WITH SMALL BUSINESS DE16 VELOPMENT CENTERS.

17 Section 21(a)(5) of the Small Business Act (15 U.S.C.

18 648(a)(5)) is amended to read as follows:

19 ‘‘(5) FEDERAL CONTRACTS WITH SMALL BUSINESS

20 DEVELOPMENT CENTERS.—

21 ‘‘(A) IN GENERAL.—A small business develop22 ment center may enter into a contract with a Federal

23 department or agency to provide specific assistance to

24 small business concerns, if the contract is approved in
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1 advance by the Associate Administrator of the small

2 business development center program.

3 ‘‘(B) APPROVAL CRITERIA.—Each approval of a

4 contract under subparagraph (A) shall be based upon

5 a determination that the contract will provide assist6 ance to small business concerns and that performance

7 of the contract will not hinder the small business de8 velopment center in carrying out the terms of the

9 grant received by the small business development cen10 ter from the Administration.

11 ‘‘(C) EXEMPTION FROM MATCHING REQUIRE12 MENT.—A contract under this paragraph shall not be

13 subject to the matching funds or eligibility require14 ments of paragraph (4).

15 ‘‘(D) ADDITIONAL PROVISION.—Notwithstanding

16 any other provision of law, a contract for assistance

17 under this paragraph may not be applied to any Fed18 eral department or agency’s small business, woman19 owned business, or socially and economically dis20 advantaged business contracting goal under section

21 15(g).’’.

22 SEC. 404. SMALL BUSINESS DEVELOPMENT CENTER PRO23 GRAM EXAMINATION AND CERTIFICATION.

24 Section 21(k) of the Small Business Act (15 U.S.C.

25 648(k)) is amended to read as follows:
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1 ‘‘(k) PROGRAM EXAMINATION AND CERTIFICATION.—

2 ‘‘(1) EXAMINATION.—Not later than 180 days

3 after the date of enactment of this subsection, the Ad4 ministration shall develop and implement a biannual

5 programmatic and financial examination of each

6 small business development center established pursu7 ant to this section.

8 ‘‘(2) CERTIFICATION.—The Administration may

9 provide financial support, by contract or otherwise, to

10 the association authorized by subsection (a)(3)(A) for

11 the purpose of developing a small business develop12 ment center certification program.

13 ‘‘(3) EXTENSION OR RENEWAL OF COOPERATIVE

14 AGREEMENTS.—In extending or renewing a coopera15 tive agreement of a small business development center,

16 the Administration shall consider the results of the ex17 amination and certification program conducted pur18 suant to paragraphs (1) and (2).’’.

19 SEC. 405. SERVICE CORPS OF RETIRED EXECUTIVES

20 (SCORE) PROGRAM.

21 Section 8(b)(1) of the Small Business Act (15 U.S.C.

22 637(b)(1)) is amended by adding at the end the following

23 new subparagraph:

24 ‘‘(H) In carrying out subparagraph (B), the Ad25 ministration shall encourage the Service Corps of Re-
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1 tired Executives (SCORE) established pursuant to

2 such subparagraph, to the maximum extent prac3 ticable, to consult and work in conjunction with the

4 Corporation for National and Community Service

5 and the Points of Light Foundation established under

6 the National and Community Service Act of 1990.’’.

7 SEC. 406. INFORMATION CONCERNING FRANCHISING.

8 Section 8(b)(1)(A) of the Small Business Act (15

9 U.S.C. 637(b)(1)(A)) is amended by inserting ‘‘including

10 information on the benefits and risks of franchising,’’ after

11 ‘‘small-business enterprises,’’.

12 Subtitle B—Development of Woman13 Owned Businesses

14 SEC. 411. EXTENSION OF AUTHORITY FOR DEMONSTRATION

15 PROJECTS.

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

17 amended—

18 (1) by redesignating section 28 (as added by sec19 tion 2 of the Women’s Business Development Act of

20 1991) as section 29; and

21 (2) in section 29(g), as redesignated, by striking

22 ‘‘1995’’ and inserting ‘‘1997’’.
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1 SEC. 412. ESTABLISHMENT OF OFFICE OF WOMEN’S BUSI2 NESS OWNERSHIP.

3 Section 29 of the Small Business Act (15 U.S.C. 656),

4 as redesignated by section 411, is amended by adding at

5 the end the following new subsection:

6 ‘‘(h) OFFICE OF WOMEN’S BUSINESS OWNERSHIP.—

7 There is hereby established within the Administration an

8 Office of Women’s Business Ownership, which shall be re9 sponsible for the administration of the Administration’s

10 programs for the development of women’s business enter11 prises, as such term is defined in section 408 of the Women’s

12 Business Ownership Act of 1988. The Office of Women’s

13 Business Ownership shall be administered by an Assistant

14 Administrator, who shall be appointed by the Adminis15 trator.’’.

16 SEC. 413. NATIONAL COMMISSION ON WOMEN IN BUSINESS.

17 (a) ESTABLISHMENT.—Section 401 of the Women’s

18 Business Ownership Act of 1988 (15 U.S.C. 631 note) is

19 amended to read as follows:

20 ‘‘SEC. 401. ESTABLISHMENT.

21 ‘‘There is hereby established a Commission to be known

22 as the ‘National Commission on Women in Business’ (here23 after in this title referred to as the ‘Commission’).’’.

24 (b) DUTIES OF THE COMMISSION.—Section 402 of the

25 Women’s Business Ownership Act of 1988 (15 U.S.C. 631

26 note) is amended to read as follows:
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1 ‘‘SEC. 402. DUTIES OF THE COMMISSION.

2 ‘‘The Commission shall—

3 ‘‘(1) review, promote, coordinate, and monitor

4 plans and programs, developed in the public and pri5 vate sectors, which affect the ability of woman-owned

6 businesses to obtain capital and credit;

7 ‘‘(2) promote and assist in the development of

8 the Intermediate Census on Women’s Business Owner9 ship and other surveys of woman-owned businesses;

10 ‘‘(3) provide assistance to and outreach for the

11 involvement of women business owners in White

12 House Conference on Small Business;

13 ‘‘(4) study and assess—

14 ‘‘(A) the obstacles faced by women seeking to

15 establish businesses and women seeking senior

16 management positions in large and small busi17 nesses and in the professions; and

18 ‘‘(B) the contributions to the Nation’s econ19 omy by businesses owned or managed by women;

20 and

21 ‘‘(5) design a comprehensive plan for a joint

22 public-private sector effort to facilitate the develop23 ment and growth of woman-owned businesses.

24 ‘‘(b) REPORT.—Not later than January 31, 1996, the

25 Commission shall submit a report to the President and the

26 Committees on Small Business of the Senate and the House
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1 of Representatives describing the plan developed pursuant

2 to subsection (a)(5).’’.

3 (c) MEMBERSHIP.—Section 403 of the Women’s Busi4 ness Ownership Act of 1988 (15 U.S.C. 631 note) is amend5 ed to read as follows:

6 ‘‘SEC. 403. MEMBERSHIP OF THE COMMISSION.

7 ‘‘(a) IN GENERAL.—The Commission shall be com8 posed of 14 members, of whom—

9 ‘‘(1) 7 members shall be the individuals described

10 in subsection (b); and

11 ‘‘(2) 7 members shall be appointed in accordance

12 with subsection (c).

13 ‘‘(b) PUBLIC SECTOR MEMBERS.—For purposes of

14 subsection (a)(1), the individuals described in this section

15 are—

16 ‘‘(1) the Administrator of the Small Business

17 Administration;

18 ‘‘(2) the Assistant Administrator of the Office of

19 Women’s Business Ownership of the Small Business

20 Administration;

21 ‘‘(3) the Secretary of the Treasury, or the Sec22 retary’s designee;

23 ‘‘(4) the Secretary of Labor, or the Secretary’s

24 designee;
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1 ‘‘(5) the Secretary of Commerce, or the Sec2 retary’s designee;

3 ‘‘(6) the Administrator of the General Services

4 Administration, or the Administrator’s designee; and

5 ‘‘(7) 1 member of the Board of Governors of the

6 Federal Reserve System, or the designee of a member.

7 ‘‘(c) PRIVATE SECTOR MEMBERS.—

8 ‘‘(1) CHAIRPERSON.—Not later than 45 days

9 after the date of enactment of the Small Business Ad10 ministration Reauthorization and Amendment Act of

11 1994, the President shall appoint an individual to

12 serve as the chairperson of the Commission (hereafter

13 in this title referred to as the ‘Chairperson’) who shall

14 be a prominent business-woman who is qualified to

15 head the Commission by virtue of her education,

16 training, and experience.

17 ‘‘(2) OTHER MEMBERS.—Not later than 60 days

18 after the date of enactment of the Small Business Ad19 ministration Reauthorization and Amendment Act of

20 1994, the Administrator of the Small Business Ad21 ministration shall appoint 6 members of the Commis22 sion, of whom—

23 ‘‘(A) 1 shall be an owner of a small business

24 concern, as such term is defined in section 3 of
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1 the Small Business Act, who is a member of the

2 same political party as the President;

3 ‘‘(B) 1 shall be an owner of a small business

4 concern, as such term is defined in section 3 of

5 the Small Business Act, who is not a member of

6 the same political party as the President; and

7 ‘‘(C) 4 shall be representatives of national

8 women’s business organizations.

9 ‘‘(d) ADMINISTRATIVE PROVISIONS.—

10 ‘‘(1) RESTRICTION.—The members of the Com11 mission appointed pursuant to subsection (c) shall

12 not be officers or employees of the Federal Govern13 ment.

14 ‘‘(2) VICE CHAIRPERSON.—The member of the

15 Commission appointed pursuant to subsection (b)(2)

16 shall serve as vice chairperson of the Commission.

17 ‘‘(3) TERMS.—The term of service of the members

18 of the Commission appointed pursuant to subsection

19 (c) shall be 1 year. No member of the Commission

20 may serve for more than 2 consecutive terms.

21 ‘‘(4) DESIGNEES.—Each designee appointed pur22 suant to subsection (b) shall—

23 ‘‘(A) be a policy-making official whose du24 ties are consistent with the duties of the Commis25 sion; and
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1 ‘‘(B) report directly to the head of the agen2 cy on the activities of the Commission.

3 ‘‘(5) COMPENSATION AND TRAVEL EXPENSES.—

4 ‘‘(A) PUBLIC SECTOR MEMBERS.—The

5 members of the Commission described in sub6 section (b) shall serve on the Commission with7 out additional compensation.

8 ‘‘(B) PRIVATE SECTOR MEMBERS.—The

9 members of the Commission appointed pursuant

10 to subsection (c) shall serve without pay for

11 membership, except that such members shall be

12 entitled to reimbursement for domestic travel,

13 subsistence, and other necessary expenses in14 curred by them in carrying out the functions of

15 the Commission in the same manner as persons

16 serving on advisory boards pursuant to section

17 8(b) of the Small Business Act.

18 ‘‘(6) VACANCIES.—A vacancy on the Commission

19 shall, not later than 30 days after the date on which

20 the vacancy occurs, be filled in the same manner in

21 which the original appointment was made.

22 ‘‘(7) MEETINGS.—The Commission shall meet at

23 the call of the Chairperson not less than 4 times each

24 year.

25 ‘‘(8) QUORUMS.—
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1 ‘‘(A) RECEIPT OF TESTIMONY.—Four mem2 bers of the Commission shall constitute a quorum

3 for the receipt of testimony and other evidence.

4 ‘‘(B) APPROVAL OF RECOMMENDATIONS.—A

5 majority of the members of the Commission shall

6 constitute a quorum for the approval of rec7 ommendations or reports issued pursuant to sec8 tions 402 and 406.’’.

9 (d) EXECUTIVE DIRECTOR AND STAFF.—Section 404

10 of the Women’s Business Ownership Act of 1988 (15 U.S.C.

11 631 note) is amended to read as follows:

12 ‘‘SEC. 404. EXECUTIVE DIRECTOR AND STAFF.

13 ‘‘(a) EXECUTIVE DIRECTOR.—The Commission shall

14 have an Executive Director who shall be appointed by the

15 Chairperson and the Assistant Administrator of the Small

16 Business Administration Office of Women’s Business Own17 ership. Upon the recommendation by the Executive Direc18 tor, the Chairperson may appoint and fix the pay of 4 addi19 tional employees at a rate of pay not to exceed the maxi20 mum rate of pay payable for a position at GS–15 of the

21 General Schedule.

22 ‘‘(b) ADMINISTRATIVE PROVISIONS.—The Executive

23 Director and staff of the Commission may be appointed

24 without regard to the provisions of title 5, United States

25 Code, governing appointments in the competitive service,
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1 and except as provided in subsection (a), may be paid with2 out regard to the provisions of chapter 51 and subchapter

3 III of chapter 53 of such title relating to classification and

4 General Schedule pay rates, except that the Executive Di5 rector so appointed may not receive pay in excess of the

6 annual rate of basic pay payable for a position at ES–

7 1 of the Senior Executive Pay Schedule under section 5832

8 of title 5, United States Code.

9 ‘‘(c) DETAIL OF ADDITIONAL PERSONNEL.—Upon re10 quest to the Chairperson, the head of any Federal depart11 ment or agency may detail any of the personnel of such

12 agency to the Commission to assist the Commission in car13 rying out its duties under this title without regard to sec14 tion 3341 of title 5, United States Code.’’.

15 (e) POWERS OF THE COMMISSION.—Section 405 of the

16 Women’s Business Ownership Act of 1988 (15 U.S.C. 631

17 note) is amended—

18 (1) by striking ‘‘Council’’ each place it appears

19 and inserting ‘‘Commission’’; and

20 (2) by adding at the end the following new sub21 section:

22 ‘‘(f) COOPERATION WITH PRIVATE ENTITIES.—

23 ‘‘(1) IN GENERAL.—Subject to the requirements

24 of paragraph (2), the Commission may carry out its
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1 duties under section 402 through cooperation with

2 private nonprofit and for-profit entities.

3 ‘‘(2) RESTRICTION.—If the Commission cooper4 ates with private entities pursuant to paragraph (1),

5 the Commission shall ensure that—

6 ‘‘(A) the Commission receives appropriate

7 recognition and publicity;

8 ‘‘(B) the cooperation does not constitute or

9 imply an endorsement by the Commission of the

10 products and services of the cosponsor; and

11 ‘‘(C) the Commission avoids unnecessary

12 promotion of the products and services of the co13 sponsor and minimizes utilization of any 1 co14 sponsor in a marketing area.’’.

15 (f) REPORTS.—Section 406 of the Women’s Business

16 Ownership Act of 1988 (15 U.S.C. 631 note) is amended—

17 (1) by striking ‘‘Council’’ each place it appears

18 and inserting ‘‘Commission’’;

19 (2) by striking ‘‘December 31, 1989’’ and insert20 ing ‘‘not later than 1 year after the date of enactment

21 of the Small Business Administration Reauthoriza22 tion and Amendment Act of 1994’’; and

23 (3) by striking ‘‘based upon its reviews con24 ducted under section 402’’.
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1 (g) AUTHORIZATION.—Section 407 of the Women’s

2 Business Ownership Act of 1988 (15 U.S.C. 631 note) is

3 amended—

4 (1) by striking subsection (a) and inserting the

5 following:

6 ‘‘(a) IN GENERAL.—There are authorized to be appro7 priated to carry out this title—

8 ‘‘(1) $500,000 in fiscal year 1995;

9 ‘‘(2) $500,000 is fiscal year 1996; and

10 ‘‘(3) $100,000 in fiscal year 1997.’’; and

11 (2) by striking subsection (c).

12 (h) TRANSITION REIMBURSEMENT.—In order to facili13 tate the transition from the National Women’s Business

14 Council, established by title IV of the Women’s Business

15 Ownership Act of 1988, to the National Commission on

16 Women in Business established by this section, the National

17 Commission on Women in Business may, during the 30-

18 day period beginning on the date on which the Chairperson

19 of the National Commission on Women in Business is ap20 pointed pursuant to section 413 of this Act, reimburse the

21 costs and salaries, where appropriate, of the Chairperson,

22 Executive Director, and staff of the National Women’s Busi23 ness Council for transition activities .

24 (i) SUNSET.—The authority of the National Commis25 sion on Women in Business established under title IV of
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1 the Women’s Business Ownership Act of 1988, as amended

2 by this section, shall terminate on November 30, 1996.

3 TITLE V—RELIEF FROM DEBEN4 TURE PREPAYMENT PEN5 ALTIES

6 SEC. 501. SHORT TITLE.

7 This title may be cited as the ‘‘Small Business Prepay8 ment Penalty Relief Act of 1994’’.

9 SEC. 502. PREPAYMENT OF DEVELOPMENT COMPANY DE10 BENTURES.

11 (a) IN GENERAL.—Title V of the Small Business In12 vestment Act of 1958 (15 U.S.C. 695 et seq.) is amended

13 by adding at the end the following new section:

14 ‘‘SEC. 508. PREPAYMENT OF DEVELOPMENT COMPANY DE15 BENTURES.

16 ‘‘(a) IN GENERAL.—

17 ‘‘(1) PREPAYMENT AUTHORIZED.—Subject to the

18 requirements set forth in subsection (b), an issuer of

19 a debenture purchased by the Federal Financing

20 Bank and guaranteed by the Administration under

21 section 503 may, at the election of the borrower whose

22 loan secures such debenture and with the approval of

23 the Administration, prepay such debenture in accord24 ance with the provisions of this section.

25 ‘‘(2) PROCEDURE.—
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1 ‘‘(A) IN GENERAL.—In making a prepay2 ment under paragraph (1)—

3 ‘‘(i) the borrower shall pay to the Fed4 eral Financing Bank an amount that is

5 equal to the sum of the unpaid principal

6 balance due on the debenture as of the date

7 of the prepayment (plus accrued interest at

8 the coupon rate on the debenture) and the

9 amount of the repurchase premium de10 scribed in subparagraph (B); and

11 ‘‘(ii) the Administration shall pay to

12 the Federal Financing Bank the difference

13 between the repurchase premium paid by

14 the borrower under this subsection and the

15 repurchase premium that the Federal Fi16 nancing Bank would otherwise have re17 ceived.

18 ‘‘(B) REPURCHASE PREMIUM.—

19 ‘‘(i) IN GENERAL.—For purposes of

20 subparagraph (A)(i), the repurchase pre21 mium is the amount equal to the product

22 of—

23 ‘‘(I) the unpaid principal balance

24 due on the debenture on the date of

25 prepayment; and
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1 ‘‘(II) the applicable percentage

2 rate, as determined in accordance

3 clause (ii).

4 ‘‘(ii) APPLICABLE PERCENTAGE

5 RATE.—For purposes of clause (i)(II), the

6 applicable percentage rate means—

7 ‘‘(I) with respect to a 10-year

8 term loan, 9.5 percent;

9 ‘‘(II) with respect to a 15-year

10 term loan, 9.5 percent;

11 ‘‘(III) with respect to a 20-year

12 term loan, 10.5 percent; and

13 ‘‘(IV) with respect to a 25-year

14 term loan, 11.5 percent.

15 ‘‘(b) REQUIREMENTS.—For purposes of subsection (a),

16 the requirements of this subsection are that—

17 ‘‘(1) the debenture is outstanding and neither the

18 loan that secures the debenture nor the debenture is

19 in default on the date on which the prepayment is

20 made;

21 ‘‘(2) State, local, or personal funds, or the pro22 ceeds of a refinancing in accordance with subsection

23 (d) of this section under the programs authorized by

24 sections 504 and 505, are used to prepay the deben25 ture; and
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1 ‘‘(3) the issuer certifies that the benefits, net of

2 fees and expenses authorized herein, associated with

3 prepayment of the debenture are entirely passed

4 through to the borrower.

5 ‘‘(c) NO PREPAYMENT FEES OR PENALTIES.—No fees

6 or penalties other than those specified in this section may

7 be imposed on the issuer, the borrower, the Administration,

8 or any fund or account administered by the Administration

9 as the result of a prepayment under this section.

10 ‘‘(d) REFINANCING LIMITATIONS.—

11 ‘‘(1) IN GENERAL.—The refinancing of a deben12 ture under sections 504 and 505, in accordance with

13 subsection (b)(2) of this section—

14 ‘‘(A) shall not exceed the amount necessary

15 to prepay existing debentures, including all costs

16 associated with the refinancing and any applica17 ble prepayment penalty or repurchase premium;

18 and

19 ‘‘(B) shall be subject to the provisions of sec20 tions 504 and 505 and the rules and regulations

21 promulgated thereunder, including rules and reg22 ulations governing payment of authorized ex23 penses, commissions, fees, and discounts to bro24 kers and dealers in trust certificates issued pur25 suant to section 505.
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1 ‘‘(2) JOB CREATION.—An applicant for refinanc2 ing under section 504 of a loan made pursuant to sec3 tion 503 shall not be required to demonstrate that a

4 requisite number of jobs will be created with the pro5 ceeds of a refinancing.

6 ‘‘(3) LOAN PROCESSING FEE.—To cover the cost

7 of loan packaging, processing, and other administra8 tive functions, a development company that provides

9 refinancing under subsection (b)(2) may impose a

10 loan processing fee, not to exceed 0.5 percent of the

11 principal amount of the loan.

12 ‘‘(e) DEFINITIONS.—For purposes of this section—

13 ‘‘(1) the term ‘issuer’ means the qualified State

14 or local development company that issued a debenture

15 pursuant to section 503, which has been purchased by

16 the Federal Financing Bank; and

17 ‘‘(2) the term ‘borrower’ means a small business

18 concern whose loan secures a debenture issued pursu19 ant to section 503.’’.

20 (b) REGULATIONS.—Not later than 30 days after the

21 date of enactment of this Act, the Administration shall pro22 mulgate such regulations as may be necessary to carry out

23 this section, including regulations establishing a deadline

24 for receipt of applications for prepayment and refinancing

25 under title V of the Small Business Investment Act of 1958.
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1 (c) AUTHORIZATION.—There are authorized to be ap2 propriated such sums as may be necessary to carry out this

3 section.

4 TITLE VI—MISCELLANEOUS

5 AMENDMENTS

6 SEC. 601. CONSOLIDATION OF FUNDING ACCOUNTS.

7 (a) IN GENERAL.—Section 4(c) of the Small Business

8 Act (15 U.S.C. 633(c)) is amended by striking ‘‘(c)(1)

9 There’’ and all that follows through paragraph (4) and in10 serting the following:

11 ‘‘(c) LOAN LIQUIDATION FUND.—

12 ‘‘(1) IN GENERAL.—

13 ‘‘(A) ESTABLISHMENT.—There is hereby es14 tablished in the United States Treasury a fund

15 to be known as the Loan Liquidation Fund

16 (hereafter in this subsection referred to as the

17 ‘Fund’).

18 ‘‘(B) AMOUNTS CONTAINED IN FUND.—All

19 amounts received by the Administration prior to

20 October 1, 1991, from the repayment of loans

21 and debentures, payments of interest, and other

22 receipts arising out of transactions entered into

23 by the Administration pursuant to section 5(e),

24 5(g), 7(a), 7(b), 7(c)(2), 7(e), 7(h), 7(l), 7(m), or

25 8(a) of this Act, or title III, IV, or V of the
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1 Small Business Investment Act of 1958, shall be

2 paid into the Fund. Balances existing in the re3 volving funds on or after the effective date of this

4 paragraph shall be transferred to the Fund on

5 such date.

6 ‘‘(C) OPERATING EXPENSES.—The Fund

7 shall have available, without fiscal year limita8 tion, such funds as may be necessary to finance

9 the operational needs of the Fund.

10 ‘‘(2) ANNUAL STATUS REPORT.—As soon as prac11 ticable after the end of each fiscal year, the Adminis12 tration shall submit to the Committees on Small

13 Business and Appropriations of the Senate and the

14 House of Representatives a complete report on the sta15 tus of the Fund.’’.

16 (b) INTEREST PAYMENTS TO TREASURY.—Section 4(c)

17 of the Small Business Act (15 U.S.C. 633(c)) is amended—

18 (1) by redesignating paragraph (5) as para19 graph (3); and

20 (2) in paragraph (3)(B), as redesignated, by

21 striking clause (ii) and inserting the following:

22 ‘‘(ii) Upon the expiration of each fiscal year, the Ad23 ministration shall pay into the miscellaneous receipts of the

24 United States Treasury the actual interest the Administra-
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1 tion has collected during the preceding fiscal year on all

2 financings made under the authority of this Act.’’.

3 SEC. 602. IMPOSITION OF FEES.

4 Section 5(b) of the Small Business Act (15 U.S.C.

5 634(b)) is amended—

6 (1) in paragraph (10), by striking ‘‘and’’ at the

7 end;

8 (2) in paragraph (11), by striking the period at

9 the end and inserting a semicolon; and

10 (3) by adding at the end the following new para11 graphs:

12 ‘‘(12) impose, retain, and use only those fees

13 which are specifically authorized by law or which are

14 in effect on September 30, 1994, and in the amounts

15 and at the rates in effect on such date, except that the

16 Administrator may, subject to approval in appro17 priations Acts, impose, retain, and utilize, additional

18 fees—

19 ‘‘(A) not to exceed $300 for each loan servic20 ing action requested after disbursement of the

21 loan, including any substitution of collateral,

22 loan assumption, release or substitution of a

23 guarantor, reamortization, or similar action;

24 and
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1 ‘‘(B) to recover the direct, incremental cost

2 involved in the production and dissemination of

3 compilations of information produced by the Ad4 ministration under the authority of the Small

5 Business Act and the Small Business Investment

6 Act of 1958; and

7 ‘‘(13) collect, retain and utilize, subject to ap8 proval in appropriations Acts, any amounts collected

9 by fiscal transfer agents and not used by such agent

10 as payment of the cost of loan pooling or debenture

11 servicing operations, except that amounts collected

12 under this paragraph shall be utilized solely to facili13 tate the administration of the program that generated

14 the excess amounts.’’.

15 SEC. 603. JOB CREATION AND COMMUNITY BENEFIT.

16 Section 7(a)(21) of the Small Business Act (15 U.S.C.

17 636(a)(21)) is amended by adding at the end the following

18 new subparagraph:

19 ‘‘(E) JOB CREATION AND COMMUNITY BENE20 FIT.—In providing assistance under this para21 graph, the Administration shall develop proce22 dures to ensure, to the maximum extent prac23 ticable, that such assistance is used for projects

24 that—

25 ‘‘(i) have the greatest potential for—
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1 ‘‘(I) creating new jobs for individ2 uals whose employment is involuntar3 ily terminated due to reductions in

4 Federal defense expenditures; or

5 ‘‘(II) preventing the loss of jobs by

6 employees of small business concerns

7 described in subparagraph (A)(i); and

8 ‘‘(ii) have substantial potential for

9 stimulating new economic activity in com10 munities most affected by reductions in

11 Federal defense expenditures.’’.

12 SEC. 604. MICROLOAN PROGRAM AMENDMENTS.

13 Section 7(m)(9)(B) of the Small Business Act (15

14 U.S.C. 636(m)(9)(B)) is amended—

15 (1) by inserting ‘‘and loan guarantees’’ after ‘‘for

16 loans’’; and

17 (2) by inserting after ‘‘experienced microlending

18 organizations’’ the following: ‘‘and national and re19 gional nonprofit organizations that have dem20 onstrated experience in providing training support

21 for microenterprise development and financing.’’.

22 SEC. 605. TECHNICAL CLARIFICATION.

23 (a) DEFENSE CONVERSION.—Section 7(a)(21)(A) of

24 the Small Business Act (15 U.S.C. 636(a)(21)(A)) is
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1 amended by striking ‘‘under the’’ and inserting ‘‘on a guar2 anteed basis under the’’.

3 (b) ADDITIONAL TECHNICAL CLARIFICATION.—Section

4 204 of Public Law 94–305 (15 U.S.C. 634d) is amended

5 by striking ‘‘section 202’’ and inserting ‘‘this title’’.

6 SEC. 606. SECONDARY MARKET STUDY DUE DATE.

7 Section 6 of the Small Business Credit Enhancement

8 Act of 1993 (15 U.S.C. 634 note) is amended by striking

9 ‘‘16 months after the date of enactment’’ and inserting ‘‘No10 vember 1, 1994’’.

11 SEC. 607. STUDY AND DATA BASE: GUARANTEED BUSINESS

12 LOAN PROGRAM AND DEVELOPMENT COM13 PANY PROGRAM.

14 (a) STUDY AUTHORIZED.—The Administration shall

15 conduct a study of—

16 (1) the Guaranteed Business Loan program

17 under section 7(a) of the Small Business Act; and

18 (2) the Development Company program under

19 sections 502, 503, and 504 of the Small Business In20 vestment Act of 1958.

21 (b) EVALUATION.—After conducting the study under

22 subsection (a), the Administration shall evaluate the per23 formance of the programs described in paragraphs (1) and

24 (2) of subsection (a) on an annual and aggregated basis

25 during the most recent 4-year period for which data are
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1 available. Such evaluation shall focus on the following fac2 tors:

3 (1) The number, dollar amount, and average size

4 of the loans or financings under each program.

5 (2) The number, dollar amount, and average size

6 of the loans or financings made to woman-owned and

7 minority-owned businesses under each program.

8 (3) The geographic distribution of the loans or

9 financings under each program.

10 (4) The jobs created or maintained attributable

11 to the loans or financings under each program.

12 (5) The number, dollar amount, and average size

13 of the loans or financings on which borrowers de14 faulted under each program.

15 (6) The amounts recovered by the Administra16 tion after default, foreclosure, or otherwise under each

17 program.

18 (7) The number of companies which are no

19 longer in business despite receiving the loans or

20 financings under each program.

21 (8) The taxes paid by businesses which received

22 the loans or financings under each program.

23 (9) Such other information as the Administra24 tion determines to be appropriate for a complete eval25 uation of each program.
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1 (c) CONTRACTING WITH INDEPENDENT ENTITIES.—In

2 carrying out subsections (a) and (b), the Administration

3 may contract with an independent entity or entities—

4 (1) to conduct the study pursuant to subsection

5 (a); and

6 (2) to develop a database of information to en7 able the Administration to maintain and access, on

8 an ongoing basis, current information relating to the

9 factors set forth in subsection (b).

10 (d) DATE.—The study authorized by subsection (a)

11 shall be completed not later than September 30, 1995.

12 SEC. 608. SBIR VENDORS.

13 Section 9(q)(2) of the Small Business Act (15 U.S.C.

14 638(q)(2)) is amended to read as follows:

15 ‘‘(2) VENDOR SELECTION.—Each agency may se16 lect a vendor to assist small business concerns to meet

17 the goals listed in paragraph (1) for a term not to ex18 ceed 3 years. Such selection shall be competitive and

19 shall utilize merit-based criteria.’’.

20 SEC. 609. PROGRAM EXTENSION.

21 Section 602(e) of the Business Opportunity Develop22 ment Reform Act of 1988 (15 U.S.C. 637 note) is amended

23 by striking ‘‘September 30, 1994’’, and inserting ‘‘Septem24 ber 30, 1995’’.
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1 SEC. 610. PROHIBITION ON THE USE OF FUNDS FOR INDI2 VIDUALS NOT LAWFULLY WITHIN THE UNIT3 ED STATES.

4 Section 2 of the Small Business Act (15 U.S.C. 631)

5 is amended by adding at the end the following new sub6 section:

7 ‘‘(i) PROHIBITION ON THE USE OF FUNDS FOR INDI8 VIDUALS NOT LAWFULLY WITHIN THE UNITED STATES.—

9 None of the funds made available pursuant to this Act may

10 be used to provide any direct benefit or assistance to any

11 individual in the United States if the Administrator or the

12 official to which the funds are made available receives noti13 fication that the individual is not lawfully within the

14 United States.’’.

15 SEC. 611. OFFICE OF ADVOCACY EMPLOYEES.

16 Section 204 of Public Law 94–305 (15 U.S.C. 634d)

17 is amended—

18 (1) in the matter preceding paragraph (1) by

19 striking ‘‘after consultation with and subject to the

20 approval of the Administrator,’’; and

21 (2) in paragraph (1), by striking ‘‘ten’’ and in22 serting ‘‘14’’.
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1 SEC. 612. PROHIBITION ON THE PROVISION OF ASSIST2 ANCE.

3 Section 4 of the Small Business Act (15 U.S.C. 633)

4 is amended by adding at the end the following new sub5 section:

6 ‘‘(e) PROHIBITION ON THE PROVISION OF ASSIST7 ANCE.—Notwithstanding any other provision of law, the

8 Administration is prohibited from providing any financial

9 or other assistance to any business concern or other person

10 engaged in the production or distribution of any product

11 or service that is determined to be obscene.’’.

12 SEC. 613. CERTIFICATION OF COMPLIANCE WITH CHILD

13 SUPPORT OBLIGATIONS.

14 Section 4 of the Small Business Act (15 U.S.C. 633),

15 as amended by section 612, is amended by adding at the

16 end the following new subsection:

17 ‘‘(f) CERTIFICATION OF COMPLIANCE WITH CHILD

18 SUPPORT OBLIGATIONS.—

19 ‘‘(1) IN GENERAL.—Each applicant for financial

20 assistance under this Act, including an applicant for

21 a direct loan or a loan guarantee, shall certify that

22 the applicant is not in violation of the terms of

23 any—

24 ‘‘(A) administrative order;

25 ‘‘(B) court order; or
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1 ‘‘(C) repayment agreement entered into be2 tween the applicant and the custodial parent or

3 State agency providing child support enforce4 ment services,

5 that requires the applicant to pay child support, as

6 such term is defined in section 462(b) of the Social

7 Security Act.

8 ‘‘(2) ENFORCEMENT.—Not later than 6 months

9 after the date of enactment of this subsection, the Ad10 ministration shall issue such regulations as may be

11 necessary to enforce compliance the requirements of

12 this subsection.’’.

Amend the title so as to read: ‘‘A bill to amend the

Small Business Act and the Small Business Investment

Act of 1958, and for other purposes.’’.

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