S. 2060

One Hundred Third Congress

of the

United States of America

AT THE SECOND SESSION

Begun and held at the City of Washington on Tuesday,

the twenty-fifth day of January, one thousand nine hundred and ninety-four

An Act

To amend the Small Business Act and the Small Business Investment Act of

1958, and for other purposes.

Be it enacted by the Senate and House of Representatives of

the United States of America in Congress assembled,

SECTION 1. SHORT TITLE; TABLE OF CONTENTS.

(a) SHORT TITLE.—This Act may be cited as the ‘‘Small Business

Administration Reauthorization and Amendments Act of 1994’’.

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

is as follows:

Sec. 1. Short title; table of contents.

TITLE I—AUTHORIZATIONS

Sec. 101. Authorizations.

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 technical assistance grants for intermediaries serving economically distressed areas.

Sec. 209. Loans to exporters.

Sec. 210. Working capital international trade loans.

Sec. 211. Guarantees on international trade loans.

Sec. 212. Accredited lenders program.

Sec. 213. Interest rate on certified development company loans.

Sec. 214. Certifications of eligibility for SBIC and SSBIC financing.

Sec. 215. Participating securities for smaller SBICs.

Sec. 216. Report on SBIC program.

Sec. 217. Premier Certified Lenders Program.

TITLE III—SIZE STANDARDS AND BOND GUARANTEES

Sec. 301. Establishment of size standards.

Sec. 302. Pilot preferred surety bond guarantee program extension.

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

Sec. 304. Pilot program for very small business concerns.

Sec. 305. Handicapped workshop participation in small business set aside contracts.

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

Sec. 405. Central European small business development. Sec. 406. Mobile resource center pilot program. Sec. 407. 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. Development of women’s business enterprise. Sec. 414. Transition reimbursement.

Sec. 415. Gift authority. Sec. 416. Conforming amendment.

TITLE V—RELIEF FROM DEBENTURE PREPAYMENT PENALTIES

Sec. 501. Short title.

Sec. 502. Intention of Congress. Sec. 503. Prepayment of development company debentures.

TITLE VI—MISCELLANEOUS AMENDMENTS

Sec. 601. SBA interest payments to Treasury. Sec. 602. Imposition of fees. Sec. 603. Job creation and community benefit. Sec. 604. Microloan program amendments. Sec. 605. Technical clarification.

Sec. 606. Study and data base: guaranteed business loan program and development

company program. Sec. 607. SBIR vendors.

Sec. 608. Program extension. Sec. 609. Prohibition on the use of funds for individuals not lawfully within the

United States.

Sec. 610. Office of Advocacy employees. Sec. 611. Prohibition on the provision of assistance. Sec. 612. Certification of compliance with child support obligations. Sec. 613. Advocacy study of paperwork and tax impact.

TITLE I—AUTHORIZATIONS

SEC. 101. AUTHORIZATIONS.

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

is amended by striking subsections (k) (as added by section 405(3)

of the Small Business Credit and Business Opportunity Enhancement Act of 1992) through (p) and inserting the following: ‘‘(l) The following program levels are authorized for fiscal year

1995:

‘‘(1) For the programs authorized by this Act, the Adminis- tration is authorized to make—

‘‘(A) $45,000,000 in technical assistance grants as pro- vided in section 7(m); and

‘‘(B) $130,000,000 in direct and immediate participation

loans, and of such sum, the Administration is authorized

to make—

‘‘(i) not more than $10,000,000 in loans, as pro- vided in section 7(a)(10); and

‘‘(ii) not more than $120,000,000 in loans, as pro- vided in section 7(m).

‘‘(2) For the programs authorized by this Act, the Adminis- tration is authorized to make $13,420,000,000 in deferred

participation loans and other financings. Of such sum, the

Administration is authorized to make—

‘‘(A) $9,150,000,000 in general business loans as pro- vided in section 7(a);

‘‘(B) $2,250,000,000 in financings as provided in section 7(a)(13) and section 504 of the Small Business Investment

Act of 1958;
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‘‘(C) $2,000,000,000 in loans as provided in section

7(a)(21); and

‘‘(D) $20,000,000 in loans as provided in section 7(m).

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

Business Investment Act of 1958, the Administration is authorized to make—

‘‘(A) $23,000,000 in purchases of preferred securities;

‘‘(B) $244,000,000 in guarantees of debentures, of which

$44,000,000 is authorized in guarantees of debentures from

companies operating pursuant to section 301(d) of such

Act; and

‘‘(C) $400,000,000 in guarantees of participating securities.

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

of the Small Business Investment Act of 1958, the Administration is authorized to enter into guarantees not to exceed

$1,800,000,000, of which not more than $600,000,000 may be

in bonds approved pursuant to the provisions of section

411(a)(3) of such Act.

‘‘(5) The Administration is authorized to make grants or

enter into cooperative agreements—

‘‘(A) for the Service Corps of Retired Executives program authorized by section 8(b)(1), $3,500,000;

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

‘‘(C) for activities of small business development centers pursuant to section 21(c)(3)(G), $5,000,000, to remain

available until expended.

‘‘(m)(1) There are authorized to be appropriated to the Administration for fiscal year 1995 such sums as may be necessary to

carry out the provisions of this Act, including administrative

expenses and necessary loan capital for disaster loans pursuant

to section 7(b), and to carry out the provisions of the Small Business

Investment Act of 1958, including salaries and expenses of the

Administration.

‘‘(2) Notwithstanding paragraph (1), for fiscal year 1995— ‘‘(A) no funds are authorized to be provided to carry out the loan program authorized by section 7(a)(21) except by transfer from another Federal department or agency to the Administration, unless the program level authorized for general business loans under subsection (l)(2)(A) is fully funded; and ‘‘(B) the Administration may not approve loans on behalf

of the Administration or on behalf of any other department

or agency, by contract or otherwise, under terms and conditions

other than those specifically authorized under this Act or the

Small Business Investment Act of 1958, except that it may

approve loans under section 7(a)(21) of this Act in gross

amounts of not more than $1,250,000.

‘‘(n) The following program levels are authorized for fiscal year

1996:

‘‘(1) For the programs authorized by this Act, the Administration is authorized to make—

‘‘(A) $65,000,000 in technical assistance grants as provided in section 7(m); and

‘‘(B) $191,000,000 in direct and immediate participation

loans, and of such sum, the Administration is authorized

to make—
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‘‘(i) $11,000,000 in loans, as provided in section

7(a)(10); and

‘‘(ii) $180,000,000 in loans, as provided in section

7(m).

‘‘(2) For the programs authorized by this Act, the Administration is authorized to make $15,680,000,000 in deferred

participation loans and other financings. Of such sum, the

Administration is authorized to make—

‘‘(A) $10,500,000,000 in general business loans as provided in section 7(a);

‘‘(B) $2,650,000,000 in financings as provided in section

7(a)(13) and section 504 of the Small Business Investment

Act of 1958;

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

7(a)(21); and

‘‘(D) $30,000,000 in loans as provided in section 7(m).

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

Business Investment Act of 1958, the Administration is authorized to make—

‘‘(A) $24,000,000 in purchases of preferred securities;

‘‘(B) $256,000,000 in guarantees of debentures, of which

$46,000,000 is authorized in guarantees of debentures from

companies operating pursuant to section 301(d) of such

Act; and

‘‘(C) $650,000,000 in guarantees of participating securities.

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

of the Small Business Investment Act of 1958, the Administration is authorized to enter into guarantees not to exceed

$1,900,000,000, of which not more than $625,000,000 may be

in bonds approved pursuant to the provisions of section

411(a)(3) of such Act.

‘‘(5) The Administration is authorized to make grants or

enter cooperative agreements— ‘‘(A) for the Service Corps of Retired Executives program authorized by section 8(b)(1), $3,700,000; ‘‘(B) for the Small Business Institute program author- ized by section 8(b)(1), $3,200,000; and ‘‘(C) for activities of small business development centers pursuant to section 21(c)(3)(G), not to exceed

$10,000,000, to remain available until expended.

‘‘(o)(1) There are authorized to be appropriated to the Administration for fiscal year 1996 such sums as may be necessary to

carry out the provisions of this Act, including administrative

expenses and necessary loan capital for disaster loans pursuant

to section 7(b), and to carry out the provisions of the Small Business

Investment Act of 1958, including salaries and expenses of the

Administration.

‘‘(2) Notwithstanding paragraph (1), for fiscal year 1996—

‘‘(A) no funds are authorized to be provided to carry out

the loan program authorized by section 7(a)(21) except by transfer from another Federal department or agency to the Administration, unless the program level authorized for general business loans under subsection (n)(2)(A) is fully funded; and

‘‘(B) the Administration may not approve loans on behalf

of the Administration or on behalf of any other department

or agency, by contract or otherwise, under terms and conditions
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other than those specifically authorized under this Act or the

Small Business Investment Act of 1958, except that it may

approve loans under section 7(a)(21) of this Act in gross

amounts of not more than $1,250,000.

‘‘(p) The following program levels are authorized for fiscal year

1997:

‘‘(1) For the programs authorized by this Act, the Administration is authorized to make—

‘‘(A) $98,000,000 in technical assistance grants as provided in section 7(m); and

‘‘(B) $262,000,000 in direct and immediate participation

loans, and of such sum, the Administration is authorized

to make—

‘‘(i) $12,000,000 in loans, as provided in section

7(a)(10); and

‘‘(ii) $250,000,000 in loans, as provided in section

7(m).

‘‘(2) For the programs authorized by this Act, the Administration is authorized to make $19,390,000,000 in deferred

participation loans and other financings. Of such sum, the

Administration is authorized to make—

‘‘(A) $13,100,000,000 in general business loans as provided in section 7(a);

‘‘(B) $3,250,000,000 in financings as provided in section

7(a)(13) and section 504 of the Small Business Investment

Act of 1958;

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

7(a)(21); and

‘‘(D) $40,000,000 in loans as provided in section 7(m).

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

Business Investment Act of 1958, the Administration is authorized to make—

‘‘(A) $25,000,000 in purchases of preferred securities;

‘‘(B) $268,000,000 in guarantees of debentures, of which

$48,000,000 is authorized in guarantees of debentures from

companies operating pursuant to section 301(d) of such

Act; and

‘‘(C) $900,000,000 in guarantees of participating securities.

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

of the Small Business Investment Act of 1958, the Administration is authorized to enter into guarantees not to exceed

$2,000,000,000, of which not more than $650,000,000 may be

in bonds approved pursuant to the provisions of section

411(a)(3) of such Act.

‘‘(5) The Administration is authorized to make grants or

enter cooperative agreements—

‘‘(A) for the Service Corps of Retired Executives program authorized by section 8(b)(1), $3,900,000;

‘‘(B) for the Small Business Institute program authorized by section 8(b)(1), $3,400,000; and

‘‘(C) for activities of small business development centers pursuant to section 21(c)(3)(G), not to exceed

$15,000,000, to remain available until expended.

‘‘(q)(1) There are authorized to be appropriated to the Administration for fiscal year 1997 such sums as may be necessary to

carry out the provisions of this Act, including administrative
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expenses and necessary loan capital for disaster loans pursuant

to section 7(b), and to carry out the provisions of the Small Business

Investment Act of 1958, including salaries and expenses of the

Administration.

‘‘(2) Notwithstanding paragraph (1), for fiscal year 1997— ‘‘(A) no funds are authorized to be provided to carry out the loan program authorized by section 7(a)(21) except by transfer from another Federal department or agency to the Administration, unless the program level authorized for general business loans under subsection (p)(2)(A) is fully funded; and ‘‘(B) the Administration may not approve loans on behalf of the Administration or on behalf of any other department

or agency, by contract or otherwise, under terms and conditions

other than those specifically authorized under this Act or the

Small Business Investment Act of 1958, except that it may

approve loans under section 7(a)(21) of this Act in gross

amounts of not more than $1,250,000.’’.

TITLE II—FINANCIAL ASSISTANCE

PROGRAMS

SEC. 201. MICROLOAN FINANCING PILOT.

Section 7(m) of the Small Business Act (15 U.S.C. 636(m))

is amended by adding at the end the following new paragraph:

‘‘(12) DEFERRED PARTICIPATION LOAN PILOT.—In lieu of

making direct loans to intermediaries as authorized in paragraph (1)(B), during fiscal years 1995 through 1997, the

Administration may, on a pilot program basis, participate on

a deferred basis of not less than 90 percent and not more

than 100 percent on loans made to intermediaries by a forprofit or nonprofit entity or by alliances of such entities, subject

to the following conditions:

‘‘(A) NUMBER OF LOANS.—In carrying out this paragraph, the Administration shall not participate in providing

financing on a deferred basis to more than 10

intermediaries in urban areas or more than 10

intermediaries in rural areas.

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

be 10 years. During the first year of the loan, the

intermediary shall not be required to repay any interest

or principal. During the second through fifth years of the

loan, the intermediary shall be required to pay interest

only. During the sixth through tenth years of the loan,

the intermediary shall be required to make interest payments and fully amortize the principal.

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

shall be the rate specified by paragraph (3)(F) for direct

loans.’’.

SEC. 202. ELIGIBILITY OF NATIVE AMERICAN TRIBAL GOVERNMENTS

TO BE MICROLOAN INTERMEDIARIES.

Section 7(m)(11)(A) of the Small Business Act (15 U.S.C.

636(m)(11)(A)) is amended—

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

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

inserting ‘‘; or’’; and
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(3) by adding at the end the following new clause:

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

by a Native American Tribal Government,’’.

SEC. 203. MICROLOAN PROGRAM EXTENSION.

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

by striking ‘‘5 years after the date of enactment of this Act’’, and

inserting ‘‘on October 1, 1997’’.

SEC. 204. MICROLOAN PROGRAM FUNDING AND STATE LIMITATIONS.

Section 7(m)(7) of the Small Business Act (15 U.S.C. 636(m)(7))

is amended to read as follows:

‘‘(7) PROGRAM FUNDING FOR MICROLOANS.— ‘‘(A) NUMBER OF PARTICIPANTS.—During the demonstration program authorized by this subsection, the

Administration may fund, on a competitive basis, not more

than 200 microloan programs. ‘‘(B) STATE LIMITATIONS.—During any fiscal year, a

State shall not receive new loan funds from the Administration that exceed 125 percent of the State’s pro rata share

of the microloan program authorization during such fiscal

year, such share to be based on the population of the

State, as compared to the total population of the United

States.’’.

SEC. 205. DISTRIBUTION OF INTERMEDIARIES.

Section 7(m)(8) of the Small Business Act (15 U.S.C. 636(m)(8))

is amended to read as follows:

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

approving microloan program applicants under this subsection,

the Administration shall select such intermediaries as will

ensure appropriate availability of loans for small businesses

in all industries located throughout each State, particularly

those located in urban and in rural areas.’’.

SEC. 206. MICROLOAN INTERMEDIARY LOAN LIMITATION.

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

636(m)(3)(C)) is amended by striking ‘‘$1,250,000’’ and inserting

‘‘$2, 500,000’’.

SEC. 207. MICROLOAN TECHNICAL ASSISTANCE TO NONBORROWERS.

Section 7(m)(4) of the Small Business Act (15 U.S.C. 636(m)(4))

is amended by adding at the end the following new subparagraph:

‘‘(E) ASSISTANCE TO CERTAIN SMALL BUSINESS CONCERNS.—Each intermediary may expend an amount not

to exceed 15 percent of the grant funds received under

paragraph (1)(B)(ii) to provide information and technical

assistance to small business concerns that are prospective

borrowers under this subsection.’’.

SEC. 208. MICROLOAN TECHNICAL ASSISTANCE GRANTS FOR

INTERMEDIARIES SERVING ECONOMICALLY DISTRESSED

AREAS.

(a) GRANT ELIGIBILITY.—Section 7(m)(4) of the Small Business

Act (15 U.S.C. 636(m)(4)) is amended—

(1) in subparagraph (B), by inserting ‘‘except for a grant

made to an intermediary that provides not less than 50 percent

of its loans to small business concerns located in or owned
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by one or more residents of an economically distressed area,’’

after ‘‘under subparagraph (A),’’; and

(2) in subparagraph (C), by striking clause (i) and inserting

the following:

‘‘(i) IN GENERAL.—In addition to grants made under

subparagraph (A), each intermediary shall be eligible

to receive a grant equal to 5 percent of the total

outstanding balance of loans made to the intermediary

under this subsection if—

‘‘(I) the intermediary provides not less than

25 percent of its loans to small business concerns

located in or owned by one or more residents of

an economically distressed area; or

‘‘(II) the intermediary has a portfolio of loans

made under this subsection that averages not more

than $7,500 during the period of the intermediary’s

participation in the program.’’.

(b) DEFINITION.—Section 7(m)(11) of the Small Business Act

(15 U.S.C. 636(m)(11)) is amended—

(1) in subparagraph (C), by striking the period at the

end and inserting ‘‘; and’’; and

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

‘‘(D) the term ‘economically distressed area’, as used

in paragraph (4), means a county or equivalent division

of local government of a State in which the small business

concern is located, in which, according to the most recent

data available from the Bureau of the Census, Department

of Commerce, not less than 40 percent of residents have

an annual income that is at or below the poverty level.’’.

(c) TERMINATION.—The amendments made by this section shall

remain in effect during the period beginning on the date of enactment of this Act and ending on October 1, 1997.

SEC. 209. LOANS TO EXPORTERS.

Section 7(a)(14)(A) of the Small Business Act (15 U.S.C.

636(a)(14)(A)) is amended to read as follows:

‘‘(14)(A) The Administration may provide extensions of

credit, standby letters of credit, revolving lines of credit for

export purposes, and other financing to enable small business

concerns, including small business export trading companies

and small business export management companies, to develop

foreign markets. A bank or participating lending institution

may establish the rate of interest on such financings as may

be legal and reasonable.’’.

SEC. 210. WORKING CAPITAL INTERNATIONAL TRADE LOANS.

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

636(a)(3)(B)) is amended to read as follows:

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

(on a deferred basis) solely for the purposes provided in

paragraph (16) to the borrower from the business loan

and investment fund established by this Act would exceed

$1,250,000, of which not more than $750,000 may be used

for working capital, supplies, or financings under section

7(a)(14) for export purposes; and’’.
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SEC. 211. GUARANTEES ON INTERNATIONAL TRADE LOANS.

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

636(a)(2)(B)(iv)) is amended to read as follows:

‘‘(iv) not less than 85 percent nor more than 90

percent of the financing outstanding at the time of

disbursement if such financing is a loan under paragraph (14) or (16).’’.

SEC. 212. ACCREDITED LENDERS PROGRAM.

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

Act of 1958 (15 U.S.C. 695 et seq.) is amended by adding at

the end the following new section:

‘‘SEC. 507. ACCREDITED LENDERS PROGRAM.

‘‘(a) ESTABLISHMENT.—The Administration is authorized to

establish an Accredited Lenders Program for qualified State and

local development companies that meet the requirements of subsection (b).

‘‘(b) REQUIREMENTS.—The Administration may designate a

qualified State or local development company as an accredited

lender if such company—

‘‘(1) has been an active participant in the Development

Company Program authorized by sections 502, 503, and 504

for not less than the preceding 12 months;

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

knowledgeable in the Administration’s lending policies and

procedures for such Development Company Program;

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

for plant and equipment under such Development Company

Program; ‘‘(4) has a loss rate on the company’s debentures that

is reasonable and acceptable to the Administration;

‘‘(5) has a history of submitting to the Administration complete and accurate debenture guaranty application packages;

and

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

credit needs for financing plant and equipment through the

Development Company Program.

‘‘(c) EXPEDITED PROCESSING OF LOAN APPLICATIONS.—The

Administration shall develop an expedited procedure for processing

a loan application or servicing action submitted by a qualified

State or local development company that has been designated as

an accredited lender in accordance with subsection (b).

‘‘(d) SUSPENSION OR REVOCATION OF DESIGNATION.— ‘‘(1) IN GENERAL.—The designation of a qualified State or

local development company as an accredited lender may be

suspended or revoked if the Administration determines that—

‘‘(A) the development company has not continued to

meet the criteria for eligibility under subsection (b); or

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

to the Administration’s rules and regulations or is violating

any other applicable provision of law.

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

(1) shall not affect any outstanding debenture guarantee.

‘‘(e) DEFINITION.—For purposes of this section, the term ‘qualified State or local development company’ has the same meaning

as in section 503(e).’’.
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(b) REGULATIONS.—Not later than 120 days after the date of enactment of this Act, the Administration shall promulgate final

regulations to carry out this section. (c) REPORT.—Not later than 1 year after the effective date of regulations promulgated under subsection (b), and biennially

thereafter, the Administration shall report to the Committees on

Small Business of the Senate and the House of Representatives

on the implementation of this section. Such report shall include

data on the number of development companies designated as accredited lenders, their debenture guarantee volume, their loss rates,

the average processing time on their guarantee applications, and

such other information as the Administration deems appropriate.

SEC. 213. INTEREST RATE ON CERTIFIED DEVELOPMENT COMPANY

LOANS.

Section 112(c) of the Small Business Administration Reauthorization and Amendment Act of 1988 (102 Stat. 2996) is amended—

(1) in paragraph (1), by striking ‘‘(1) IN GENERAL.—Section

503’’ and inserting ‘‘Section 503’’; and (2) by striking paragraph (2).

SEC. 214. CERTIFICATIONS OF ELIGIBILITY FOR SBIC AND SSBIC

FINANCING.

Section 308 of the Small Business Investment Act of 1958

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

new subsection:

‘‘(h) CERTIFICATIONS OF ELIGIBILITY.—

‘‘(1) CERTIFICATION BY SMALL BUSINESS CONCERN.—Prior

to receiving financial assistance from a company licensed pursuant to subsection (c) or (d) of section 301, a small business

concern shall certify in writing that it meets the eligibility

requirements of the Small Business Investment Company Program or the Specialized Small Business Investment Company

Program, as applicable.

‘‘(2) CERTIFICATION BY COMPANY.—Prior to providing financial assistance to a small business concern under this Act,

a company licensed pursuant to subsection (c) or (d) of section

301 shall certify in writing that it has reviewed the application

for assistance of the small business concern and that all documentation and other information supports the eligibility of the

applicant.

‘‘(3) RETENTION OF CERTIFICATIONS.—Certificates made

pursuant to paragraphs (1) and (2) shall be retained by the

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

301 for the duration of the financial assistance.’’.

SEC. 215. PARTICIPATING SECURITIES FOR SMALLER SBICS.

Section 303(g) of the Small Business Investment Act of 1958 (15 U.S.C. 683(g)) is amended by adding at the end the following

new paragraph: ‘‘(13) PARTICIPATING SECURITIES FOR SMALLER SMALL BUSI- NESS INVESTMENT COMPANIES.— ‘‘(A) IN GENERAL.—Subject to the provisions of subpara- graph (B), of the amount of the annual program level

of participating securities approved in appropriations Acts,

50 percent shall be reserved for funding small business

investment companies with private capital of not more

than $20,000,000.
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‘‘(B) EXCEPTION.—During the last quarter of each fiscal year, if the Administrator determines that there is a lack

of qualified applicants with private capital of not more

than $20,000,000, the Administrator may utilize all or any

part of the program level for securities reserved under

subparagraph (A) for qualified applicants with private capital of more than $20,000,000.’’.

SEC. 216. REPORT ON SBIC PROGRAM.

Not later than May 15, 1995, the Small Business Administra- tion shall submit to the Committees on Small Business of the

House of Representatives and the Senate a comprehensive report

on—

(1) the status and disposition of all small business investment companies participating in the Small Business Investment

Company Program under subsections (c) and (d) of section

301 of the Small Business Investment Act of 1958, whether

active or in liquidation; (2) a complete accounting of the assets in and the basis

of the portfolios of such companies;

(3) the projected and actual loss rates for all portfolios

in liquidation or active; and

(4) a detailed accounting of valuation of the Small Business

Investment Company Program’s investments.

SEC. 217. PREMIER CERTIFIED LENDERS PROGRAM.

(a) IN GENERAL.—Title V of the Small Business Investment

Act of 1958 (15 U.S.C. 695 et seq.) is amended by adding at

the end the following new section:

‘‘SEC. 508. PREMIER CERTIFIED LENDERS PROGRAM.

‘‘(a) ESTABLISHMENT.—On a pilot program basis, the Administration may establish a Premier Certified Lenders Program for

not more than 15 certified development companies that meet the

requirements of subsection (b).

‘‘(b) REQUIREMENTS.—

‘‘(1) APPLICATION.—To be eligible to participate in the Premier Certified Lenders Program established under subsection

(a), a certified development company shall prepare and submit

to the Administration an application at such time, in such

manner, and containing such information as the Administration

may require.

‘‘(2) DESIGNATION.—The Administration may designate a

certified development company as a premier certified lender

if such company—

‘‘(A) has been an active participant in the accredited

lenders program during the 12-month period preceding the

date on which the company submits an application under

paragraph (1), except that, prior to January 1, 1996, the

Administration may waive this requirement if the company

is qualified to participate in the accredited lenders program; ‘‘(B) has a history of submitting to the Administration

adequately analyzed debenture guarantee application packages; and

‘‘(C) agrees to assume and to reimburse the Administration for 10 percent of any loss sustained by the Administration as a result of default by the company in the payment of principal or interest on a debenture issued by
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such company and guaranteed by the Administration under

this section.

‘‘(c) LOSS RESERVE.—

‘‘(1) ESTABLISHMENT.—A company designated as a premier

certified lender shall establish a loss reserve for financings

approved pursuant to this section.

‘‘(2) AMOUNT.—The amount of the loss reserve shall be

based upon the greater of—

‘‘(A) the historic loss rate on debentures issued by

such company; or

‘‘(B) 10 percent of the amount of the company’s exposure as determined under subsection (b)(2)(C).

‘‘(3) ASSETS.—The loss reserve shall be comprised of segregated assets of the company which shall be securitized in

favor of the Administration.

‘‘(4) CONTRIBUTIONS.—The company shall make contributions to the loss reserve in the following amounts and at the

following intervals:

‘‘(A) 50 percent when a debenture is closed.

‘‘(B) 25 percent not later than 1 year after a debenture

is closed.

‘‘(C) 25 percent not later than 2 years after a debenture

is closed.

‘‘(d) LOAN APPROVAL AUTHORITY.—

‘‘(1) IN GENERAL.—Notwithstanding section 503(b)(6), and

subject to such terms and conditions as the Administration

may establish, the Administration may permit a company designated as a premier certified lender under this section to

approve loans that are funded with the proceeds of a debenture

issued by such company and may authorize the guarantee

of such debenture.

‘‘(2) SCOPE OF REVIEW.—The approval of a loan by a premier

certified lender shall be subject to final approval as to eligibility

of any guarantee by the Administration pursuant to section

503(a), but such final approval shall not include review of

decisions by the lender involving creditworthiness, loan closing,

or compliance with legal requirements imposed by law or regulation.

‘‘(e) REVIEW.—After the issuance and sale of debentures under

this section, the Administration, at intervals not greater than 12

months, shall review the financings made by each premier certified

lender. The review shall include the lender’s credit decisions and

general compliance with the eligibility requirements for each financing approved under the program authorized under this section.

The Administration shall consider the findings of the review in

carrying out its responsibilities under subsection (f), but such review

shall not affect any outstanding debenture guarantee.

‘‘(f) SUSPENSION OR REVOCATION.—The designation of a State

or local development company as a premier certified lender may

be suspended or revoked if the Administration determines that

the company—

‘‘(1) has not continued to meet the criteria for eligibility

under subsection (b);

‘‘(2) has not established or maintained the loss reserve

required under subsection (c);

‘‘(3) is failing to adhere to the Administration’s rules and

regulations; or
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‘‘(4) is violating any other applicable provision of law. ‘‘(g) EFFECT OF SUSPENSION OR DESIGNATION.—A suspension or revocation under subsection (f) shall not affect any outstanding

debenture guarantee. ‘‘(h) REGULATIONS.—Not later than 180 days after the date of enactment of this section, the Administration shall promulgate

regulations to carry out this section. ‘‘(i) REPORT.—Not later than 1 year after the date of enactment of this Act, and annually thereafter, the Administration shall report

to the Committees on Small Business of the Senate and the House

of Representatives on the implementation of this section. Each

report shall include— ‘‘(1) the number of certified development companies designated as premier certified lenders; ‘‘(2) the debenture guarantee volume of such companies;

‘‘(3) a comparison of the loss rate for premier certified

lenders to the loss rate for accredited and other lenders; and

‘‘(4) such other information as the Administration deems

appropriate.’’.

(b) REPEAL.—Effective on October 1, 1997, section 508 of the

Small Business Investment Act of 1958, as added by subsection

(a), is repealed.

TITLE III—SIZE STANDARDS AND BOND

GUARANTEES

SEC. 301. ESTABLISHMENT OF SIZE STANDARDS.

Section 3(a)(2) of the Small Business Act (15 U.S.C. 632(a)(2))

is amended to read as follows:

‘‘(2) ESTABLISHMENT OF SIZE STANDARDS.— ‘‘(A) IN GENERAL.—In addition to the criteria specified in paragraph (1), the Administrator may specify detailed

definitions or standards by which a business concern may

be determined to be a small business concern for the purposes of this Act or any other Act. ‘‘(B) ADDITIONAL CRITERIA.—The standards described

in paragraph (1) may utilize number of employees, dollar

volume of business, net worth, net income, a combination

thereof, or other appropriate factors. ‘‘(C) REQUIREMENTS.—Unless specifically authorized by statute, no Federal department or agency may prescribe

a size standard for categorizing a business concern as a

small business concern, unless such proposed size standard—

‘‘(i) is proposed after an opportunity for public notice and comment;

‘‘(ii) provides for determining— ‘‘(I) the size of a manufacturing concern as measured by the manufacturing concern’s average

employment based upon employment during each

of the manufacturing concern’s pay periods for the

preceding 12 months;

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

services on the basis of the annual average gross

receipts of the business concern over a period of

not less than 3 years;
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‘‘(III) the size of other business concerns on

the basis of data over a period of not less than

3 years; or ‘‘(IV) other appropriate factors; and ‘‘(iii) is approved by the Administrator.’’.

SEC. 302. PILOT PREFERRED SURETY BOND GUARANTEE PROGRAM

EXTENSION.

Section 207 of the Small Business Administration Reauthorization and Amendment Act of 1988 (15 U.S.C. 694b note) is amended

by striking ‘‘September 30, 1994’’ and inserting ‘‘September 30,

1995’’.

SEC. 303. MANUFACTURING CONTRACTS THROUGH MANUFACTURING

APPLICATION AND EDUCATION CENTERS.

(a) IN GENERAL.—The Small Business Administration shall promote the award of Federal manufacturing contracts to small business concerns that participate in manufacturing application and

education centers by working with the Department of Commerce

and other agencies to identify components and subsystems that

are both critical and currently foreign-sourced.

(b) QUALIFICATIONS.—In order to qualify as a manufacturing

application and education center under this section, an entity shall

have the capacity to assist small business concerns in a shareduse production environment and to offer the following services:

(1) Technology demonstration.

(2) Technology education.

(3) Technology application support.

(4) Technology advancement support.

(c) INAPPLICABILITY OF CERTAIN REQUIREMENTS.—The requirements of section 15(o)(1)(B) of the Small Business Act shall not

apply with respect to any manufacturing contract carried out by

a small business concern in conjunction with a manufacturing

application and education center under this section.

(d) REGULATIONS.—Not later than 180 days after the date of

enactment of this Act, the Administrator of the Small Business

Administration shall promulgate final regulations to carry out this

section.

(e) TERMINATION OF AUTHORITY.—The authority of the Small

Business Administration under this section shall terminate on

September 30, 1997.

(f) AUTHORIZATION OF APPROPRIATIONS.—There are authorized

to be appropriated to the Small Business Administration, such

sums as may be necessary to carry out this section.

SEC. 304. PILOT PROGRAM FOR VERY SMALL BUSINESS CONCERNS.

(a) ESTABLISHMENT.—The Administrator shall establish and

carry out a pilot program in accordance with the requirements

of this section to provide improved access to Federal contract

opportunities for very small business concerns.

(b) PROCUREMENT CONTRACTS.—

(1) IN GENERAL.—In carrying out subsection (a), the

Administrator shall identify procurement contracts of Federal

agencies for award under the program.

(2) CONTRACT AWARDS.—Under the program established

pursuant to this section, the award of a procurement contract

of a Federal agency identified by the Administration pursuant

to paragraph (1) shall be made by the agency to an eligible
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program participant selected, and determined to be responsible,

by the agency.

(3) COMPETITION.—All contract opportunities offered for

award under the program shall be awarded on the basis of

competition among eligible very small business concerns.

(c) ELIGIBILITY.—Only a very small business concern shall be

eligible to compete for a contract to be awarded under the program.

A contracting officer may rely in good faith on a written certification

that a small business concern is a very small business concern.

(d) DELEGATION OF AUTHORITY.—The authority of the Administrator under subsections (b)(1) and (c) shall be delegated to not

less than 5 and not more than 10 districts of the Administration

to promote the award of contracts that can be performed by very

small business concerns.

(e) FINANCIAL ASSISTANCE.—In order to assist very small business concerns receiving contract awards under the program, the

Administrator shall establish a preauthorization program for such

concerns for the purpose of receiving financial assistance under

section 7(a) of the Small Business Act.

(f) ATTAINMENT OF CONTRACT GOALS.—All contract awards

made under the program shall be counted toward the attainment

of the goals specified in section 15(g) of the Small Business Act.

(g) REGULATIONS.—The Administrator shall—

(1) issue proposed regulations to carry out this section

not later than 180 days after the date of enactment of this

Act; and

(2) issue final regulations to carry out this section not

later than 270 days after the date of enactment of this Act.

(h) REPORT TO CONGRESS.—Not later than April 30, 1997, the

Administrator shall transmit to the Congress a report on the results

of the program, together with such recommendations as the

Administrator deems appropriate.

(i) PROGRAM TERM.—Implementation of the program shall begin

not later than August 30, 1995. The program authorized by this

section shall expire on September 30, 1998.

(j) DEFINITIONS.—For purposes of this section, the following

definitions shall apply:

(1) ADMINISTRATION.—The term ‘‘Administration’’ means

the Small Business Administration.

(2) ADMINISTRATOR.—The term ‘‘Administrator’’ means the

Administrator of the Small Business Administration.

(3) PROGRAM.—The term ‘‘program’’ means a program

established pursuant to subsection (a).

(4) VERY SMALL BUSINESS CONCERN.—The term ‘‘very small

business concern’’ means a small business concern that—

(A) has not more than 15 employees; and

(B) has average annual receipts that total not more

than $1,000,000.

SEC. 305. HANDICAPPED WORKSHOP PARTICIPATION IN SMALL BUSINESS SET ASIDE CONTRACTS.

Section 15(c) of the Small Business Act (15 U.S.C. 644(c))

is amended—

(1) by amending paragraph (2)(A) to read as follows:

‘‘(2)(A) During fiscal year 1995, public or private organizations

for the handicapped shall be eligible to participate in programs
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authorized under this section in an aggregate amount not to exceed

$40,000,000.’’; and

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

‘‘(7) Agencies awarding one or more contracts to such an

organization pursuant to the provisions of this subsection may

use multiyear contracts, if appropriate.’’.

TITLE IV—BUSINESS DEVELOPMENT

ASSISTANCE

Subtitle A—General Provisions

SEC. 401. SUNSET ON COSPONSORED TRAINING.

(a) IN GENERAL.—

(1) REPEAL.—The amendments made by section 5(a) of

Small Business Computer Security and Education Act of 1984

(15 U.S.C. 633 note) are hereby repealed.

(2) EFFECTIVE DATE.—Paragraph (1) shall take effect on

September 30, 1997.

(b) CONFORMING AMENDMENT.—Section 7(b) of the Small Business Computer Security and Education Act of 1984 (15 U.S.C.

633 note) is amended in the second sentence by striking ‘‘and

the amendments made to section 8(b)(1)(A) of the Small Business

Act by section 5(a)(2) of this Act are’’ and inserting ‘‘is’’.

SEC. 402. SMALL BUSINESS DEVELOPMENT CENTER PROGRAM LEVEL.

Section 21(a)(4) of the Small Business Act (15 U.S.C. 648(a)(4))

is amended to read as follows:

‘‘(4) SMALL BUSINESS DEVELOPMENT CENTER PROGRAM LEVEL.— ‘‘(A) IN GENERAL.—The Administration shall require as a

condition of any grant (or amendment or modification thereof)

made to an applicant under this section, that a matching

amount (excluding any fees collected from recipients of such

assistance) equal to the amount of such grant be provided

from sources other than the Federal Government, to be comprised of not less than 50 percent cash and not more than

50 percent of indirect costs and in-kind contributions.

‘‘(B) RESTRICTION.—The matching amount described in subparagraph (A) shall not include any indirect costs or inkind contributions derived from any Federal program. ‘‘(C) NATIONAL PROGRAM.— ‘‘(i) IN GENERAL.—Except as provided in clause (ii),

no State receiving funds under this section shall receive

a grant that exceeds—

‘‘(I) for fiscal year 1995, the sum of such State’s

pro rata share of a national program based upon the

population of the State as compared to the total population in the United States, and $125,000; or

‘‘(II) in each succeeding fiscal year, the sum of

such State’s pro rata share of a national program based

upon the population of the State as compared to the

total population in the United States, and $200,000.

‘‘(ii) EXCEPTION.—Grants provided to a small business

development center by the Administration or another

agency to carry out the provisions of subsection (c)(3)(G)
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shall not be included in the calculation of maximum funding of a small business development center.

‘‘(iii) AMOUNT.—The amount of the national program

shall be—

‘‘(I) $70,000,000 through September 30, 1996;

‘‘(II) $77,500,000 from October 1, 1996 through

September 30, 1997; and

‘‘(III) $85,000,000 beginning October 1, 1997.

The amount for which a small business development center

is eligible under this paragraph shall be based upon the

amount of the national program in effect as of the date

for commencement of performance of the small business

development center’s grant.’’.

SEC. 403. FEDERAL CONTRACTS WITH SMALL BUSINESS DEVELOPMENT CENTERS.

Section 21(a)(5) of the Small Business Act (15 U.S.C. 648(a)(5))

is amended to read as follows:

‘‘(5) FEDERAL CONTRACTS WITH SMALL BUSINESS DEVELOPMENT

CENTERS.—

‘‘(A) IN GENERAL.—Subject to the conditions set forth in

subparagraph (B), a small business development center may

enter into a contract with a Federal department or agency

to provide specific assistance to small business concerns.

‘‘(B) CONTRACT PREREQUISITES.—Before bidding on a contract described in subparagraph (A), a small business development center shall receive approval from the Associate Administrator of the small business development center program of

the subject and general scope of the contract. Each approval

under subparagraph (A) shall be based upon a determination

that the contract will provide assistance to small business

concerns and that performance of the contract will not hinder

the small business development center in carrying out the

terms of the grant received by the small business development

center from the Administration.

‘‘(C) EXEMPTION FROM MATCHING REQUIREMENT.—A contract under this paragraph shall not be subject to the matching

funds or eligibility requirements of paragraph (4). ‘‘(D) ADDITIONAL PROVISION.—Notwithstanding any other

provision of law, a contract for assistance under this paragraph

shall not be applied to any Federal department or agency’s

small business, woman-owned business, or socially and

economically disadvantaged business contracting goal under

section 15(g).’’.

SEC. 404. SMALL BUSINESS DEVELOPMENT CENTER PROGRAM EXAMINATION AND CERTIFICATION.

Section 21(k) of the Small Business Act (15 U.S.C. 648(k))

is amended to read as follows:

‘‘(k) PROGRAM EXAMINATION AND CERTIFICATION.—

‘‘(1) EXAMINATION.—Not later than 180 days after the date

of enactment of this subsection, the Administration shall

develop and implement a biennial programmatic and financial

examination of each small business development center established pursuant to this section.

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

financial support, by contract or otherwise, to the association
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authorized by subsection (a)(3)(A) for the purpose of developing

a small business development center certification program.

‘‘(3) EXTENSION OR RENEWAL OF COOPERATIVE AGREEMENTS.—In extending or renewing a cooperative agreement

of a small business development center, the Administration

shall consider the results of the examination and certification

program conducted pursuant to paragraphs (1) and (2).’’.

SEC. 405. CENTRAL EUROPEAN SMALL BUSINESS DEVELOPMENT.

Section 25(i) of the Small Business Act (15 U.S.C. 652(i)) is

amended by striking ‘‘and $2,000,000 for each of fiscal years 1993

and 1994’’ and inserting ‘‘, $2,000,000 for each of fiscal years 1993

and 1994, and $1,000,000 for fiscal year 1995’’.

SEC. 406. MOBILE RESOURCE CENTER PILOT PROGRAM.

(a) ESTABLISHMENT.—The Administrator of the Small Business

Administration may establish and carry out in each of fiscal years

1995, 1996, and 1997 a mobile resource pilot program (hereafter

in this section referred to as the ‘‘program’’) in accordance with

the requirements of this section.

(b) MOBILE RESOURCE CENTER VEHICLES.—Under the program,

the Administration may use mobile resource center vehicles to

provide technical assistance, information, and other services available from the Small Business Administration to traditionally underserved populations. Two of such vehicles should be utilized in rural

areas and 2 of such vehicles should be utilized in urban areas.

(c) REPORT TO CONGRESS.—If the Administrator conducts the

program authorized in this section, the Administrator shall, not

later than December 31, 1996, transmit to the Congress a report

containing the results of such program, together with recommendations for appropriate legislative and administrative action.

(d) AUTHORIZATION OF APPROPRIATIONS.—There are authorized

to be appropriated to carry out this section $900,000 for each

of fiscal years 1995, 1996, and 1997, such sums to remain available

until expended. Of such sums—

(1) $800,000 may be made available for the purchase or

lease of mobile resource center vehicles and operating expenses;

and

(2) $100,000 may be made available for studies, startup

expenses, and other administrative expenses.

SEC. 407. INFORMATION CONCERNING FRANCHISING.

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

637(b)(1)(A)) is amended by inserting ‘‘including information on

the benefits and risks of franchising,’’ after ‘‘small-business enterprises,’’.

Subtitle B—Development of Woman-Owned

Businesses

SEC. 411. EXTENSION OF AUTHORITY FOR DEMONSTRATION

PROJECTS.

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

(1) by redesignating section 28 (as added by section 2

of the Women’s Business Development Act of 1991) as section

29; and
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(2) in section 29(g), as redesignated, by striking ‘‘1995’’

and inserting ‘‘1997’’.

SEC. 412. ESTABLISHMENT OF OFFICE OF WOMEN’S BUSINESS OWNERSHIP.

Section 29 of the Small Business Act (15 U.S.C. 656), as redesignated by section 411 of this Act, is amended by adding at the

end the following new subsection:

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

hereby established within the Administration an Office of Women’s

Business Ownership, which shall be responsible for the administration of the Administration’s programs for the development of women’s business enterprises, as such term is defined in section 408

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

Women’s Business Ownership shall be administered by an Assistant

Administrator, who shall be appointed by the Administrator.’’.

SEC. 413. DEVELOPMENT OF WOMEN’S BUSINESS ENTERPRISE.

Title IV of the Women’s Business Ownership Act of 1988 (15

U.S.C. 631 note) is amended to read as follows:

‘‘TITLE IV—DEVELOPMENT OF WOMEN’S

BUSINESS ENTERPRISE

‘‘SEC. 401. ESTABLISHMENT OF THE INTERAGENCY COMMITTEE.

‘‘There is established an interagency committee to be known

as the Interagency Committee on Women’s Business Enterprise.

‘‘SEC. 402. DUTIES OF THE INTERAGENCY COMMITTEE.

‘‘(a) IN GENERAL.—The Interagency Committee shall— ‘‘(1) monitor, coordinate, and promote the plans, programs,

and operations of the departments and agencies of the Federal

Government that may contribute to the establishment and

growth of women’s business enterprise; ‘‘(2) develop and promote new public sector initiatives, policies, programs, and plans designed to foster women’s business

enterprise;

‘‘(3) review, monitor, and coordinate plans and programs,

developed in the public sector, which affect the ability of

women-owned businesses to obtain capital and credit;

‘‘(4) promote and assist, as appropriate, in the development

of surveys of women-owned business; and ‘‘(5) design a comprehensive plan for a joint public-private

sector effort to facilitate growth and development of women’s

business enterprise, which plan shall, not later than 1 year

after the effective date of the Small Business Administration

Reauthorization and Amendments Act of 1994, be submitted

to the President for review.

‘‘(b) MEETINGS.—The Interagency Committee shall meet not

less than biannually at such times as the Interagency Committee

determines to be necessary to perform the duties under subsection

(a). A majority of the members of the Committee shall constitute

a quorum for the approval of recommendations or reports issued

pursuant to this section.

‘‘(c) INTERACTION WITH COUNCIL.—In performing its duties

under subsection (a), the Interagency Committee shall consult with
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the Council. The Interagency Committee may meet jointly with

the Council at the discretion of the chairperson of the Interagency

Committee and the chairperson of the Council, but not less frequently than twice annually. The chairperson of the Interagency

Committee shall serve as chairperson of any joint meetings of

the Interagency Committee and the Council.

‘‘SEC. 403. MEMBERSHIP OF THE INTERAGENCY COMMITTEE.

‘‘(a) IN GENERAL.— ‘‘(1) PARTICIPANTS.—The Interagency Committee shall be composed of 1 representative from each of the following: ‘‘(A) The Department of Commerce.

‘‘(B) The Department of Defense.

‘‘(C) The Department of Health and Human Services.

‘‘(D) The Department of Labor.

‘‘(E) The Small Business Administration.

‘‘(F) The Department of Transportation.

‘‘(G) The Department of the Treasury.

‘‘(H) The General Services Administration.

‘‘(I) The Board of Governors of the Federal Reserve.

‘‘(J) The Executive staff of the President engaged in policymaking activities.

‘‘(2) APPOINTMENTS.— ‘‘(A) IN GENERAL.—Except as provided in subparagraph (B), the head of each department and agency listed in

paragraph (1) shall, not later than 45 days after the date

of enactment of the Small Business Administration

Reauthorization and Amendments Act of 1994, designate

a representative who shall be a policymaking official within

the department or agency. ‘‘(B) SMALL BUSINESS ADMINISTRATION.—With respect

to the Small Business Administration, the representative

shall be the Assistant Administrator of the Office of Women’s Business Ownership, who also shall serve as the vice

chairperson of the Interagency Committee.

‘‘(3) OTHER PARTICIPATION.—Other representatives of the Federal Government not listed in paragraph (1) may participate

in the meetings and functions of the Interagency Committee

on a temporary basis as needed to carry out specific Interagency

Committee goals.

‘‘(b) APPOINTMENT OF CHAIRPERSON.—Not later than 45 days after enactment of the Small Business Administration Reauthorization and Amendments Act of 1994, the President, in consultation

with the Administrator of the Small Business Administration, shall

appoint 1 of the members of the Interagency Committee to serve

as chairperson. ‘‘(c) NONCOMPENSATION.—The members of the Interagency

Committee shall serve without additional pay for such membership.

‘‘(d) DETAIL OF FEDERAL EMPLOYEES.—Upon request by the

chairperson of the Interagency Committee, the head of any Federal

department or agency may detail any of the personnel of such

agency to assist the Interagency Committee in carrying out its

duties under this title without regard to section 3341 of title 5,

United States Code.

‘‘SEC. 404. REPORTS FROM THE INTERAGENCY COMMITTEE.

‘‘Not later than September 30, 1995, and annually thereafter,

the Interagency Committee shall transmit to the President and
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to the Committees on Small Business of the Senate and the House

of Representatives, a report containing— ‘‘(1) any recommendations of the Council and any comments of the Interagency Committee thereon; ‘‘(2) a detailed description of the activities of the Interagency Committee; ‘‘(3) the findings and conclusions of the Interagency Committee; and

‘‘(4) the Interagency Committee’s recommendations for such legislation and administrative actions as the Interagency

Committee considers appropriate to promote the development

of small business concerns owned and controlled by women.

‘‘SEC. 405. ESTABLISHMENT OF THE NATIONAL WOMEN’S BUSINESS

COUNCIL.

‘‘There is established a council to be known as the National

Women’s Business Council, which shall serve as an independent

source of advice and policy recommendations to the Interagency

Committee, to the Administrator through the Assistant Administrator of the Office of Women’s Business Ownership, to the Congress, and to the President.

‘‘SEC. 406. DUTIES OF THE COUNCIL.

‘‘(a) IN GENERAL.—The Council shall advise and consult with

the Interagency Committee on matters relating to the activities,

functions, and policies of the Interagency Committee, as provided

in this title. The Council shall meet jointly with the Interagency

Committee at the discretion of the chairperson of the Council and

the chairperson of the Interagency Committee, but not less than

biannually. ‘‘(b) MEETINGS.—The Council shall meet separately at such times as the Council deems necessary. A majority of the members

of the Council shall constitute a quorum for the approval of recommendations or reports issued pursuant to this section. ‘‘(c) RECOMMENDATIONS.—The Council shall make annual recommendations for consideration by the Interagency Committee. The

Council shall also provide reports and make such other recommendations as it deems appropriate to the Interagency Committee, to the President, to the Administrator, and to the Committees

on Small Business of the Senate and the House of Representatives. ‘‘(d) OTHER DUTIES.—The Council shall—

‘‘(1) review, coordinate, and monitor plans and programs developed in the public and private sectors, which affect the

ability of women-owned business enterprises to obtain capital

and credit;

‘‘(2) promote and assist in the development of a women’s

business census and other surveys of women-owned businesses; ‘‘(3) monitor and promote the plans, programs, and oper- ations of the departments and agencies of the Federal Government which may contribute to the establishment and growth

of women’s business enterprise;

‘‘(4) develop and promote new initiatives, policies, programs, and plans designed to foster women’s business enterprise; and

‘‘(5) advise and consult with the Interagency Committee

in the design of a comprehensive plan for a joint public-private

sector effort to facilitate growth and development of women’s

business enterprise.
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‘‘SEC. 407. MEMBERSHIP OF THE COUNCIL.

‘‘(a) CHAIRPERSON.—Not later than 45 days after the date of

enactment of the Small Business Administration Reauthorization

and Amendments Act of 1994, the President shall appoint an

individual to serve as chairperson of the Council, in consultation

with the Administrator. The chairperson of the Council shall be

a prominent business woman who is qualified to head the Council

by virtue of her education, training, and experience.

‘‘(b) OTHER MEMBERS.—Not later than 60 days after the date

of enactment of the Small Business Administration Reauthorization

and Amendments Act of 1994, the Administrator shall appoint,

in consultation with the Assistant Administrator of the Office of

Women’s Business Ownership and the chairperson of the Council

appointed under subsection (a), 9 members of the Council, of

whom—

‘‘(1) 2 shall be—

‘‘(A) owners of small businesses, as such term is defined

in section 3 of the Small Business Act; and

‘‘(B) members of the same political party as the President;

‘‘(2) 2 shall—

‘‘(A) be owners of small businesses, as such term is

defined in section 3 of the Small Business Act; and

‘‘(B) not be members of the same political party as

the President; and

‘‘(3) 5 shall be representatives of national women’s business

organizations.

‘‘(c) DIVERSITY.—In appointing members of the Council, the

Administrator shall, to the extent possible, ensure that the members

appointed reflect geographic, racial, economic, and sectoral diversity.

‘‘(d) SERVICE TERM.—The term of service of the members of

the Council shall be 3 years.

‘‘(e) OTHER FEDERAL SERVICE.—If any member of the Council

subsequently becomes an officer or employee of the Federal Government or of the Congress, such individual may continue as a member

of the Council for not longer than the 30-day period beginning

on the date on which such individual becomes such an officer

or employee.

‘‘(f) VACANCIES.—A vacancy on the Council shall, not later

than 30 days after the date on which the vacancy occurs, be filled

in the same manner in which the original appointment was made.

‘‘(g) REIMBURSEMENTS.—Members of the Council shall serve

without pay for such membership, except that members shall be

entitled to reimbursement for travel, subsistence, and other necessary expenses incurred by them in carrying out the functions

of the Council, in the same manner as persons serving on advisory

boards pursuant to section 8(b) of the Small Business Act.

‘‘(h) EXECUTIVE DIRECTOR.—Not later than 60 days after the

date of enactment of the Small Business Administration Reauthorization Act of 1994, the Administrator, in consultation with the

chairperson of the Council, shall appoint an executive director of

the Council. Upon the recommendation by the executive director,

the chairperson of the Council may appoint and fix the pay of

4 additional employees of the Council, at a rate of pay not to

exceed the maximum rate of pay payable for a position at GS–
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15 of the General Schedule. All such appointments shall be subject

to the appropriation of funds.

‘‘(i) RATES OF PAY.—The executive director and staff of the

Council may be appointed without regard to the provisions of title

5, United States Code, governing appointments in the competitive

service, and except as provided in subsection (e), may be paid

without regard to the provisions of chapter 51 and subchapter

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

Schedule pay rates, except that the executive director may not

receive pay in excess of the annual rate of basic pay payable

for a position at ES–3 of the Senior Executive Pay Schedule under

section 5832 of title 5, United States Code.

‘‘SEC. 408. DEFINITIONS.

‘‘For purposes of this title—

‘‘(1) the term ‘Administration’ means the Small Business

Administration;

‘‘(2) the term ‘Administrator’ means the Administrator of

the Small Business Administration;

‘‘(3) the term ‘control’ means exercising the power to make

policy decisions concerning a business;

‘‘(4) the term ‘Council’ means the National Women’s Business Council, established under section 405;

‘‘(5) the term ‘Interagency Committee’ means the Interagency Committee on Women’s Business Enterprise, established under section 401;

‘‘(6) the term ‘operate’ means being actively involved in

the day-to-day management of a business;

‘‘(7) the term ‘women’s business enterprise’ means—

‘‘(A) a business or businesses owned by a woman or

a group of women; or

‘‘(B) the establishment, maintenance, or development

of a business or businesses by a woman or a group of

women; and

‘‘(8) the term ‘women-owned business’ means a small business which a woman or a group of women—

‘‘(A) control and operate; and

‘‘(B) own not less than 51 percent of the business.

‘‘SEC. 409. AUTHORIZATION OF APPROPRIATIONS.

‘‘There are authorized to be appropriated for each of fiscal

years 1995 through 1997, to carry out this title, $350,000.’’.

SEC. 414. TRANSITION REIMBURSEMENT.

(a) IN GENERAL.—Subject to the limitation contained in subsection (b), in order to provide continuity in the development of

women-owned business, the Administration may approve reasonable

amounts made available to carry out title IV of the Women’s Business Ownership Act of 1988 to be used to pay the salaries, if

any, and expenses of the members and staff of the National Women’s Business Council that are appointed on or before the date

of enactment of this Act.

(b) TIME PERIOD.—No payments shall be made under subsection

(a) after the expiration of the 90-day period beginning on the

date of enactment of this Act.
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SEC. 415. GIFT AUTHORITY.

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

637(b)(1)(G)) is amended by striking ‘‘section 8(b)(1) of this Act’’

and by inserting ‘‘this Act and to carry out the activities authorized

by title IV of the Women’s Business Ownership Act of 1988’’.

SEC. 416. CONFORMING AMENDMENT.

The table of contents for the Women’s Business Ownership

Act of 1988 (15 U.S.C. 631 note) is amended by striking the items

relating to title IV and inserting the following:

‘‘TITLE IV—DEVELOPMENT OF WOMEN’S BUSINESS ENTERPRISE

‘‘Sec. 401. Establishment of the Interagency Committee. ‘‘Sec. 402. Duties of the Interagency Committee. ‘‘Sec. 403. Membership of the Interagency Committee. ‘‘Sec. 404. Reports from the Interagency Committee. ‘‘Sec. 405. Establishment of the National Women’s Business Council.

‘‘Sec. 406. Duties of the Council.

‘‘Sec. 407. Membership of the Council. ‘‘Sec. 408. Definitions.

‘‘Sec. 409. Authorization of Appropriations.’’.

TITLE V—RELIEF FROM DEBENTURE

PREPAYMENT PENALTIES

SEC. 501. SHORT TITLE.

This title may be cited as the ‘‘Small Business Prepayment

Penalty Relief Act of 1994’’.

SEC. 502. INTENTION OF CONGRESS.

(a) IN GENERAL.—The Small Business Administration shall

fully utilize the $30,000,000 appropriated in Public Law 103–317

to reduce, in accordance with this title and the amendments made

by this title, prepayment penalties imposed in connection with

debentures issued under—

(1) section 303 or 503 of the Small Business Investment

Act of 1958, which have been purchased by the Federal Financing Bank; and

(2) title III to companies operating under section 301(d)

of such Act, which have been purchased by the Small Business

Administration.

(b) EQUAL OPPORTUNITY.—In order to provide an equal opportunity to participate in the program authorized under this title,

the Small Business Administration shall afford each borrower or

issuer of a debenture subject to this title, not less than 45 days

to elect to participate and to provide an earnest money deposit.

The Administration shall subsequently allow a period of not less

than 4 months, during which those borrowers or issuers that elect

to participate shall be allowed to complete the prepayment process. (c) RESTRICTIONS ON PARTICIPATION.—In no event shall the

Small Business Administration—

(1) allow any borrower or issuer to participate in the program if the borrower or issuer fails to—

(A) make a timely election and provide the deposit

on a timely basis; or

(B) complete the prepayment process within the

required time; or
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(2) allow any borrower or issuer to participate in the pro- gram at a percentage rate other than the rate finally determined to be applicable to all other borrowers or issuers with

similar terms of years.

SEC. 503. PREPAYMENT OF DEVELOPMENT COMPANY DEBENTURES.

Title V of the Small Business Investment Act of 1958 (15

U.S.C. 695 et seq.), as amended by section 217, is amended by

adding at the end the following new section:

‘‘SEC. 509. PREPAYMENT OF DEVELOPMENT COMPANY DEBENTURES.

‘‘(a) IN GENERAL.— ‘‘(1) PREPAYMENT AUTHORIZED.—Subject to the require- ments set forth in subsection (b), an issuer of a debenture

purchased by the Federal Financing Bank and guaranteed by

the Administration under this Act may, at the election of the

borrower (in the case of a loan under section 503) or the

issuer (in the case of a small business investment company)

and with the approval of the Administration, prepay such

debenture in accordance with the provisions of this section.

A small business investment company operating under the

authority of section 301(d) that has issued a debenture that

was purchased by and is held by the Administration, may,

under the same terms and conditions, prepay such debenture,

and the penalty as provided in this section, and shall thereafter

be immediately eligible to apply for additional assistance from

the Administration.

‘‘(2) PROCEDURE.— ‘‘(A) IN GENERAL.—In making a prepayment under paragraph (1)— ‘‘(i) the borrower (in the case of a loan under

section 503) or the issuer (in the case of a small business investment company) shall pay to the Federal

Financing Bank an amount that is equal to the sum

of the unpaid principal balance due on the debenture

as of the date of the prepayment (plus accrued interest

at the coupon rate on the debenture) and the amount

of the repurchase premium described in subparagraph

(B); and

‘‘(ii) the Administration shall pay to the Federal Financing Bank the difference between the repurchase

premium paid by the borrower under this subsection

and the repurchase premium that the Federal Financing Bank would otherwise have received.

‘‘(B) REPURCHASE PREMIUM.— ‘‘(i) IN GENERAL.—For purposes of subparagraph (A)(i), the repurchase premium is the amount equal

to the product of— ‘‘(I) the unpaid principal balance due on the

debenture on the date of prepayment; and

‘‘(II) the applicable percentage rate, as determined in accordance with clauses (ii) and (iii).

‘‘(ii) APPLICABLE PERCENTAGE RATE.—For purposes

of clause (i)(II), the applicable percentage rate means— ‘‘(I) with respect to a 10-year term loan, 8.5

percent;

‘‘(II) with respect to a 15-year term loan, 9.5

percent;
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‘‘(III) with respect to a 20-year term loan, 10.5

percent; and

‘‘(IV) with respect to a 25-year term loan, 11.5

percent.

‘‘(iii) ADJUSTMENTS TO APPLICABLE PERCENTAGE

RATE.—The percentage rates described in clause (ii)

shall be increased or decreased by the Administration

by a factor not to exceed one-third, if the same factor

is applied in each case and if the Administration determines that an adjustment is necessary, based on the

number of borrowers having given notice of their intent

to participate, in order to make the program (including

the amounts appropriated for this purpose under Public Law 103–317) result in no substantial net gain

or loss of revenue to the Federal Financing Bank or

to the Administration. Amounts collected in excess of

the amount necessary to ensure revenue neutrality

shall be refunded to the borrowers.

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

requirements of this subsection are that—

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

that secures the debenture, if any, nor the debenture is in

default on the date on which the prepayment is made;

‘‘(2) State, local, or personal funds, or the proceeds of a

refinancing in accordance with subsection (d) of this section

under the programs authorized by this title, are used to prepay

or roll over the debenture; and

‘‘(3) with respect to a debenture issued under section 503,

the issuer certifies that the benefits, net of fees and expenses

authorized herein, associated with prepayment of the debenture

are entirely passed through to the borrower.

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

other than those specified in this section may be imposed on the

issuer, the borrower, the Administration, or any fund or account

administered by the Administration as the result of a prepayment

under this section.

‘‘(d) REFINANCING LIMITATIONS.—

‘‘(1) IN GENERAL.—The refinancing of a debenture under

sections 504 and 505, in accordance with subsection (b)(2)—

‘‘(A) shall not exceed the amount necessary to prepay

existing debentures, including all costs associated with the

refinancing and any applicable prepayment penalty or

repurchase premium; and

‘‘(B) except as provided in paragraphs (2) and (3), shall

be subject to the provisions of sections 504 and 505 and

the rules and regulations promulgated thereunder, including rules and regulations governing payment of authorized

expenses, commissions, fees, and discounts to brokers and

dealers in trust certificates issued pursuant to section 505.

‘‘(2) JOB CREATION.—An applicant for refinancing under

section 504 of a loan made pursuant to section 503 shall not

be required to demonstrate that a requisite number of jobs

will be created with the proceeds of a refinancing.

‘‘(3) LOAN PROCESSING FEE.—To cover the cost of loan packaging, processing, and other administrative functions, a development company that provides refinancing under subsection
S. 2060—27

(b)(2) may impose a one-time loan processing fee, not to exceed

0.5 percent of the principal amount of the loan.

‘‘(4) NEW DEBENTURES.—Issuers of debentures under title

III may issue new debentures in accordance with such title

in order to prepay existing debentures as authorized in this

section.

‘‘(5) PRELIMINARY NOTICE.—

‘‘(A) IN GENERAL.—The Administration shall use certified mail and other reasonable means to notify each

eligible borrower of the prepayment program provided in

this title. Each preliminary notice shall specify the range

and dollar amount of repurchase premiums which could

be required of that borrower in order to participate in

the program. In carrying out this program, the Administration shall provide a period of not less than 45 days following

the receipt of such notice by the borrower during which

the borrower must notify the Administration of the borrower’s intent to participate in the program. The Administration shall require that a borrower who gives notice of

its intent to participate to make an earnest money deposit

of $1,000 which shall not be refundable but which shall

be credited toward the final repurchase premium.

‘‘(B) DEFINITION.—For purposes of this paragraph, the

term ‘borrower’, in the case of a small business investment

company or a specialized small business investment company, means ‘issuer’.

‘‘(6) FINAL NOTICE.—Based upon the response to the

preliminary notice under paragraph (5), the Administration

shall make a final computation of the necessary prepayment

premiums and shall notify each qualified respondent of the

results of such computation. Each qualified respondent shall

be afforded not less than 4 months to complete the prepayment.

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

‘‘(1) the term ‘issuer’ means—

‘‘(A) the qualified State or local development company

that issued a debenture pursuant to section 503, which

has been purchased by the Federal Financing Bank; and ‘‘(B) a small business investment company licensed pursuant to subsection (c) or (d) of section 301; or

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

whose loan secures a debenture issued pursuant to section

503.

‘‘(f) REGULATIONS.—Not later than 30 days after the date of

enactment of this section, the Administration shall promulgate such

regulations as may be necessary to carry out this section.

‘‘(g) AUTHORIZATION.—There are authorized to be appropriated

$30,000,000 to carry out the provisions of The Small Business

Prepayment Penalty Relief Act of 1994.’’.

TITLE VI—MISCELLANEOUS

AMENDMENTS

SEC. 601. SBA INTEREST PAYMENTS TO TREASURY.

Section 4(c)(5)(B)(ii) of the Small Business Act (15 U.S.C.

633(c)(5)(B)(ii)) is amended to read as follows:
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‘‘(ii) Following the close of each fiscal year, the Administration

shall pay into the miscellaneous receipts of the United States Treasury the actual interest that the Administration collects during

that fiscal year on all financings made under this Act.’’.

SEC. 602. IMPOSITION OF FEES.

Section 5(b) of the Small Business Act (15 U.S.C. 634(b)) is

amended—

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

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

and inserting a semicolon; and

(3) by adding at the end the following new paragraphs:

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

specifically authorized by law or which are in effect on September 30, 1994, and in the amounts and at the rates in effect

on such date, except that the Administrator may, subject to

approval in appropriations Acts, impose, retain, and utilize,

additional fees—

‘‘(A) not to exceed $100 for each loan servicing action

(other than a loan assumption) requested after disbursement of the loan, including any substitution of collateral,

release or substitution of a guarantor, reamortization, or

similar action;

‘‘(B) not to exceed $300 for loan assumptions;

‘‘(C) not to exceed 1 percent of the amount of requested

financings under title III of the Small Business Investment

Act of 1958 for which the applicant requests a commitment

from the Administration for funding during the following

year; and ‘‘(D) to recover the direct, incremental cost involved

in the production and dissemination of compilations of

information produced by the Administration under the

authority of this Act and the Small Business Investment

Act of 1958; and

‘‘(13) collect, retain and utilize, subject to approval in appropriations Acts, any amounts collected by fiscal transfer agents

and not used by such agent as payment of the cost of loan

pooling or debenture servicing operations, except that amounts

collected under this paragraph and paragraph (12) shall be

utilized solely to facilitate the administration of the program

that generated the excess amounts.’’.

SEC. 603. JOB CREATION AND COMMUNITY BENEFIT.

Section 7(a)(21) of the Small Business Act (15 U.S.C. 636(a)(21))

is amended by adding at the end the following new subparagraph:

‘‘(E) JOB CREATION AND COMMUNITY BENEFIT.—In

providing assistance under this paragraph, the Administration shall develop procedures to ensure, to the maximum

extent practicable, that such assistance is used for projects

that—

‘‘(i) have the greatest potential for—

‘‘(I) creating new jobs for individuals whose

employment is involuntarily terminated due to

reductions in Federal defense expenditures; or

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

of small business concerns described in subparagraph (A)(i); and
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‘‘(ii) have substantial potential for stimulating new economic activity in communities most affected by

reductions in Federal defense expenditures.’’.

SEC. 604. MICROLOAN PROGRAM AMENDMENTS.

Section 7(m)(9)(B) of the Small Business Act (15 U.S.C.

636(m)(9)(B)) is amended—

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

(2) by inserting after ‘‘experienced microlending organiza- tions’’ the following: ‘‘and national and regional nonprofit

organizations that have demonstrated experience in providing

training support for microenterprise development and financing.’’.

SEC. 605. TECHNICAL CLARIFICATION.

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

Business Act (15 U.S.C. 636(a)(21)(A)) is amended by striking

‘‘under the’’ and inserting ‘‘on a guaranteed basis under the’’. (b) ADDITIONAL TECHNICAL CLARIFICATION.—Section 204 of Public Law 94–305 (15 U.S.C. 634d) is amended by striking ‘‘section

202’’ and inserting ‘‘this title’’.

SEC. 606. STUDY AND DATA BASE: GUARANTEED BUSINESS LOAN PROGRAM AND DEVELOPMENT COMPANY PROGRAM.

(a) STUDY AUTHORIZED.—The Administration shall conduct a

study of—(1) the Guaranteed Business Loan program under section 7(a) of the Small Business Act; and

(2) the Development Company program under sections 502,

503, and 504 of the Small Business Investment Act of 1958.

(b) EVALUATION.—For purposes of the study conducted under

subsection (a), the Administration shall evaluate the performance

of the programs described in paragraphs (1) and (2) of subsection

(a), using data from the most recent 4-year period. Such evaluation

shall focus on the following factors:

(1) The number, dollar amount, and average size of the

loans or financings under each program.

(2) The number, dollar amount, and average size of the

loans or financings made to woman-owned and minority-owned

businesses under each program.

(3) The geographic distribution of the loans or financings

under each program.

(4) The jobs created or maintained attributable to the loans

or financings under each program. (5) The number, dollar amount, and average size of the

loans or financings on which borrowers defaulted under each

program. (6) The amounts recovered by the Administration after

default, foreclosure, or otherwise under each program. (7) The number of companies which are no longer in business despite receiving the loans or financings under each program.(8) The taxes paid by businesses which received the loans

or financings under each program.

(9) Such other information as the Administration determines to be appropriate for a complete evaluation of each

program.
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(c) CONTRACTING WITH INDEPENDENT ENTITIES.—In carrying out subsections (a) and (b), the Administration may contract with

an independent entity or entities— (1) to conduct the study pursuant to subsection (a); and

(2) to develop a database of information to enable the

Administration to maintain and access, on an ongoing basis,

current information relating to the factors set forth in subsection (b).

(d) DATE.—The study authorized by subsection (a) shall be completed not later than September 30, 1995.

SEC. 607. SBIR VENDORS.

Section 9(q)(2) of the Small Business Act (15 U.S.C. 638(q)(2))

is amended to read as follows:

‘‘(2) VENDOR SELECTION.—Each agency may select a vendor to assist small business concerns to meet the goals listed in

paragraph (1) for a term not to exceed 3 years. Such selection

shall be competitive and shall utilize merit-based criteria.’’.

SEC. 608. PROGRAM EXTENSION.

Section 602(e) of the Business Opportunity Development Reform Act of 1988 (15 U.S.C. 637 note) is amended by striking

‘‘September 30, 1994’’, and inserting ‘‘September 30, 1997’’.

SEC. 609. PROHIBITION ON THE USE OF FUNDS FOR INDIVIDUALS

NOT LAWFULLY WITHIN THE UNITED STATES.

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

by adding at the end the following new subsection: ‘‘(i) PROHIBITION ON THE USE OF FUNDS FOR INDIVIDUALS NOT

LAWFULLY WITHIN THE UNITED STATES.—None of the funds made

available pursuant to this Act may be used to provide any direct

benefit or assistance to any individual in the United States if

the Administrator or the official to which the funds are made

available receives notification that the individual is not lawfully

within the United States.’’.

SEC. 610. OFFICE OF ADVOCACY EMPLOYEES.

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

(1) in the matter preceding paragraph (1), by striking ‘‘after consultation with and subject to the approval of the Administrator,’’; and

(2) in paragraph (1), by striking ‘‘ten’’ and inserting ‘‘14’’.

SEC. 611. PROHIBITION ON THE PROVISION OF ASSISTANCE.

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

by adding at the end the following new subsection:

‘‘(e) PROHIBITION ON THE PROVISION OF ASSISTANCE.—Notwithstanding any other provision of law, the Administration is prohibited from providing any financial or other assistance to any business

concern or other person engaged in the production or distribution

of any product or service that has been determined to be obscene

by a court of competent jurisdiction.’’.

SEC. 612. CERTIFICATION OF COMPLIANCE WITH CHILD SUPPORT

OBLIGATIONS.

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

by section 611, is amended by adding at the end the following

new subsection:
S. 2060—31

‘‘(f) CERTIFICATION OF COMPLIANCE WITH CHILD SUPPORT

OBLIGATIONS.—

‘‘(1) IN GENERAL.—For financial assistance approved after

the promulgation of final regulations to implement this section,

each recipient of financial assistance under this Act, including

a recipient of a direct loan or a loan guarantee, shall certify

that the recipient is not more than 60 days delinquent under

the terms of any—

‘‘(A) administrative order;

‘‘(B) court order; or

‘‘(C) repayment agreement entered into between the

recipient and the custodial parent or State agency providing

child support enforcement services,

that requires the recipient to pay child support, as such term

is defined in section 462(b) of the Social Security Act.

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

date of enactment of this subsection, the Administration shall

promulgate such regulations as may be necessary to enforce

compliance with the requirements of this subsection.’’.

SEC. 613. ADVOCACY STUDY OF PAPERWORK AND TAX IMPACT.

The Chief Counsel for Advocacy of the Small Business Administration shall conduct a study of the impact of all Federal regulatory,

paperwork, and tax requirements upon small business, and report

its findings to the Congress not later than 1 year after the date

of enactment of this Act.

Speaker of the House of Representatives.

Vice President of the United States and

President of the Senate.