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[Congressional Bills 103th Congress]
[From the U.S. Government Publishing Office]
[H.R. 278 Introduced in House (IH)]

103d CONGRESS
  1st Session
                                H. R. 278

  To establish a Minority Business Development Administration in the 
   Department of Commerce, to clarify the relationship between such 
  Administration and the Small Business Administration, and for other 
                               purposes.

_______________________________________________________________________

                    IN THE HOUSE OF REPRESENTATIVES

                            January 5, 1993

Mr. Mfume introduced the following bill; which was referred jointly to 
the Committees on Banking, Finance and Urban Affairs and Small Business

_______________________________________________________________________

                                 A BILL

 
  To establish a Minority Business Development Administration in the 
   Department of Commerce, to clarify the relationship between such 
  Administration and the Small Business Administration, 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.

    This Act may be cited as the ``Minority Business Development Act of 
1993''.

SEC. 2. FINDINGS AND PURPOSE.

    (a) Findings.--The Congress finds that--
            (1) the opportunity for full participation in our free 
        enterprise system by socially and economically disadvantaged 
        individuals is essential if we are to obtain social and 
        economic equality for such individuals and improve the 
        functioning of our national economy;
            (2) that many such individuals are socially disadvantaged 
        because of their identification as members of certain groups 
        that have suffered the effects of discriminatory practices or 
        similar invidious circumstances over which they have no 
        control;
            (3) such groups include, but are not limited to, Black 
        Americans, Hispanic Americans, Native Americans, Asian Pacific 
        Americans, Asian Indian Americans, and other minorities;
            (4) it is in the national interest to expeditiously 
        ameliorate the conditions of socially and economically 
        disadvantaged groups;
            (5) such conditions can be improved by providing the 
        maximum practicable opportunity for the development of business 
        concerns owned by members of socially and economically 
        disadvantaged groups;
            (6) such opportunity cannot be fully realized unless the 
        Federal Government secures the participation and cooperation of 
        the private sector in a joint effort to promote the development 
        of business owned by disadvantaged individuals; and
            (7) such effort will result in a more equitable share of 
        productive resources being devoted to business owned by the 
        disadvantaged and will promote a balanced economy and increased 
        competition.
    (b) Purpose.--It is, therefore, the purpose of this Act to--
            (1) establish an Administration within the Department of 
        Commerce which will promote and administer programs in the 
        private and public sectors to assist the development of 
        business owned by the disadvantaged; and
            (2) achieve such development through the conduct of 
        programs which will result in increased access to skilled 
        labor, capital, management, and technology by such business.

SEC. 3. DEFINITIONS.

    As used in this Act the following terms have the following 
meanings:
            (1) The term ``Secretary'' means the Secretary of Commerce.
            (2) The terms ``State'', ``States'', and ``United States'' 
        include the several States, the District of Columbia, the 
        Commonwealth of Puerto Rico, the territories of the Virgin 
        Islands, Guam, and American Samoa, the Commonwealth of the 
        Northern Marianas, and the Trust Territory of the Pacific 
        Islands.
            (3) The terms ``socially and economically disadvantaged 
        business concerns'' and ``disadvantaged business'' means any 
        for-profit business enterprise which is at least 51 percent 
        owned by one or more socially and economically disadvantaged 
        individuals; or, in the case of any publicly owned business, at 
        least 51 percent of the stock of which is owned by one or more 
        socially and economically disadvantaged individuals; and whose 
        management and daily business operations are controlled by one 
        or more of such individuals.
            (4) The term ``socially disadvantaged individuals'' means 
        those who have been subjected to racial or ethnic prejudice or 
        cultural bias because of their identity as a member of a group 
        without regard to their individual qualities.
            (5)(A) The term ``economically disadvantaged individuals'' 
        means those socially disadvantaged individuals whose ability to 
        compete in the free enterprise system has been impaired due to 
        diminished capital and credit opportunities as compared to 
        others in the same business area who are not socially 
        disadvantaged.
            (B) The Assistant Secretary shall presume that socially and 
        economically disadvantaged individuals include Black Americans, 
        Hispanic Americans, Native Americans, Asian Pacific Americans, 
        Asian Indian Americans, individuals found to be disadvantaged 
        by the Small Business Administration pursuant to section 8(a) 
        of the Small Business Act, other individuals so designated by 
        the Minority Business Development Agency under section 1400.1 
        of title 15 of the Code of Federal Regulations (as in effect on 
        October 1, 1986), and other individuals belonging to other 
        minority groups which the Small Business Administration may, 
        from time to time, determine to be socially and economically 
        disadvantaged groups pursuant to Public Law 95-507.
            (6) The term ``Administration'' means the Minority Business 
        Development Administration established by this Act.
            (7) The term ``Assistant Secretary'' means the Assistant 
        Secretary of the Minority Business Development Administration.
            (8) The term ``agency'' means any executive agency as 
        defined in section 105 of title 5, United States Code, and the 
        military departments as defined by section 102 of title 5, 
        United States Code.
            (9) The term ``public sector'' means any State, State 
        agency, political subdivision of a State, or agency of such a 
        political subdivision.
            (10) The term ``private sector'' means any entity which is 
        not in the public sector excluding the Federal Government, its 
        agencies and instrumentalities.

SEC. 4. MINORITY BUSINESS DEVELOPMENT ADMINISTRATION.

    (a) Establishment.--The Minority Business Development Agency in the 
Department of Commerce is hereby redesignated and established as the 
``Minority Business Development Administration''. The Administration 
shall be headed by an Assistant Secretary of Commerce appointed by the 
President, by and with the advice and consent of the Senate. The 
Assistant Secretary shall be compensated at the rate now or hereafter 
provided for level IV of the Executive Schedule and shall have 
responsibility for the administration of this Act. This position shall 
be in addition to the other positions of Assistant Secretary which are 
authorized by law.
    (b) Report to Congress.--Within 120 days after the effective date 
of this subsection, the Secretary shall inform appropriate committees 
of both the Senate and House of Representatives of--
            (1) the organizational structure established within the 
        Administration;
            (2) the organizational position of the Administration 
        within the Department of Commerce; and
            (3) a description of how the Administration shall function 
        in relation to the operations of other agencies within the 
        Department.

                      TITLE I--MARKET DEVELOPMENT

SEC. 101. PRIVATE SECTOR DEVELOPMENT.

    (a) Duties of the Administration.--It shall be the duty of the 
Administration and it is hereby empowered, whenever it determines such 
action is necessary or appropriate--
            (1) to assist disadvantaged business concerns penetrate 
        domestic and foreign markets by making available to such 
        concerns, either directly or in cooperation with private sector 
        organizations, management, and technological assistance, a 
        skilled labor pool and financial and marketing services; and
            (2) to encourage disadvantaged firms to establish joint 
        ventures and projects either among themselves or in cooperation 
        with public or private sector organizations for the purpose of 
        increasing the share of any market activity now being performed 
        by disadvantaged business.
    (b) Joint Programs Permitted.--For purposes of subsection (a)(2):
            (1) The Assistant Secretary may, after consultation with 
        the Attorney General and the Chairman of the Federal Trade 
        Commission, and with the prior written approval of the Attorney 
        General, approve any agreement between such disadvantaged firms 
        or public or private sector organizations providing for a joint 
        program for market development if the Assistant Secretary finds 
        that the joint program proposed will maintain and strengthen 
        the free enterprise system and the economy of the Nation. The 
        Assistant Secretary or the Attorney General may at any time 
        withdraw approval of the agreement and the joint program for 
        market development covered thereby, if either finds that the 
        agreement or the joint program carried on under it is no longer 
        in the best interests of the competitive free enterprise system 
        and the economy of the Nation. A copy of the statement of any 
        such finding and approval intended to be within the coverage of 
        this paragraph, and a copy of any modification or withdrawal of 
        approval, shall be published in the Federal Register. The 
        authority conferred by this on the Assistant Secretary shall 
        not be delegated.
            (2) No act or omission to act, pursuant to and within the 
        scope of any joint program for market development under an 
        agreement approved by the Assistant Secretary under this 
        subsection, shall be construed to be within the prohibitions of 
        the antitrust laws or the Federal Trade Commission Act. Upon 
        publication in the Federal Register of the notice of withdrawal 
        of his approval of the agreement granted under this paragraph, 
        either by the Assistant Secretary or by the Attorney General, 
        the provisions of this paragraph shall not apply to any 
        subsequent act or omission to act.
    (c) Requirement of Participation of Small Business Concern in Joint 
Program.--At least 1 party to each agreement for a joint program for 
market development approved under (b) shall be a small business 
concern, as defined pursuant to section 3 of the Small Business Act (15 
U.S.C. 632). If there are more than 2 parties to such an agreement, a 
majority of the parties shall be small business concerns.
    (d) Financial Assistance.--In order to carry out the purposes of 
this section, the Administration is hereby authorized to provide 
financial assistance in the form of contracts, grants, or cooperative 
agreements to and with public and private sector organizations, 
including any association, business firm, trade association, or 
business organization. No assistance may be provided under the 
authority of this subsection if such assistance is primarily intended 
to facilitate the use by disadvantaged business of federally 
administered programs (not otherwise established by this Act) unless 
the Assistant Secretary obtains the prior concurrence and written 
approval of the Associate Administrator for Minority Small Business and 
Capital Ownership Development of the Small Business Administration.

SEC. 102. PUBLIC SECTOR DEVELOPMENT.

    (a) Duties of the Administration.--It shall be the duty of the 
Administration and it is hereby empowered, whenever it determines such 
action is necessary or appropriate--
            (1) to consult and cooperate with State and local 
        governments for the purpose of leveraging local resources to 
        promote the position of disadvantaged business in the local 
        economy, including, but not be limited to, assisting such 
        governments to establish--
                    (A) procurement programs and goals for the 
                utilization of disadvantaged business,
                    (B) management and technological assistance 
                programs,
                    (C) financial and marketing assistance programs,
                    (D) mobilization activities designed to attract 
                skilled labor for use by disadvantaged firms, and
                    (E) an informational program designed to inform 
                local disadvantaged business of the availability of 
                programs conducted under the authority of this section; 
                and
            (2) to convene meetings with leaders and officials of State 
        and local governments for the purpose of recommending and 
        promoting local administrative and legislative initiatives 
        needed to advance the position of disadvantaged business in the 
        local economy.
    (b) Financial Assistance.--In order to carry out the purposes of 
subsection (a) the Administration is hereby authorized to provide 
financial assistance to State and local governments in the form of 
contracts, grants, or cooperative agreements.
    (c) Publications in the Federal Register.--(1) At least 120 days 
before the beginning of each fiscal year, the Administration shall 
publish for public comment in the Federal Register the actual or 
anticipated amount of financial assistance that will or may be 
available in the immediately succeeding fiscal year for grants, 
contracts and cooperative agreements planned to be awarded pursuant to 
this section. Such publication shall also identify the proposed 
allocation of funds between the several States (and cities within such 
States) and the exact methodology used by the Administration to make 
such proposed allocations.
    (2) At least 60 days prior to the beginning of each fiscal year, 
the Administration shall publish in the Federal Register its response 
to comments received pursuant to paragraph (1) and any change in the 
allocation methodology which may be adopted as a result thereof 
including its effect on the allocation of funds on the several States 
(and cities within such States) for the immediately succeeding fiscal 
year.

                      TITLE II--CAPITAL FORMATION

SEC. 201. ACCESS TO EQUITY CAPITAL.

    (a) Pilot and Demonstration Projects.--The Administration is hereby 
authorized to defray all or part of the costs of pilot or demonstration 
projects conducted by public or private organizations which are 
designed to assist disadvantaged business in obtaining access to equity 
capital.
    (b) SEC Consultation and Cooperation.--The Securities and Exchange 
Commission shall consult and cooperate with the Administration in an 
effort to promote access by disadvantaged business to securities 
markets and otherwise achieve the purposes of this title.

SEC. 202. MBDA STUDY ON CAPITAL FORMATION ALTERNATIVES.

    (a) In General.--The Administrator shall conduct a study on 
alternatives for providing capital formation assistance to qualified 
disadvantaged business concerns, including--
            (1) the implementation of a revolving fund the proceeds of 
        which would be used to provide financial assistance to 
        qualified disadvantaged business concerns through the purchase 
        of equity investment in such concerns; and
            (2) the implementation of a surety bond referral assistance 
        program, specifically the implementation of an individual 
        surety bond referral program.
    (b) Report.--The Administrator shall submit a report to the 
Committees on Small Business of the House of Representatives and of the 
Senate within 6 months after the date of the enactment of this Act that 
contains the Administrator's findings of the study conducted under 
subsection (a). Such report shall specifically address the feasibility 
of the alternatives described in paragraphs (1) and (2) of such 
subsection and any other alternative explored by the Administration 
concerning the provision of capital formation assistance to qualified 
disadvantaged business concerns.

             TITLE III--MANAGEMENT EDUCATIONAL DEVELOPMENT

SEC. 301. DUTIES OF THE ADMINISTRATION.

    It shall be the duty of the Administration and it is hereby 
empowered, whenever it determines such action is necessary or 
appropriate to--
            (1) promote and assist the education and training of 
        disadvantaged individuals in subjects directly related to 
        business administration and management;
            (2) join with and encourage accredited colleges and 
        universities, leaders in business and industry, or other public 
        or private entities, particularly for profit entities owned and 
        operated by socially and economically disadvantaged 
        individuals, to develop programs to offer scholarships and 
        fellowships, apprenticeships, internships, and to sponsor 
        seminars and conferences, and similar activities related to 
        business for the benefit of disadvantaged individuals;
            (3) stimulate and accelerate curriculum design and 
        improvement in support of disadvantaged business development; 
        and
            (4) encourage and assist private institutions and 
        organizations and State and local government agencies to 
        undertake similar activities.

                   TITLE IV--RESEARCH AND INFORMATION

SEC. 401. DUTIES OF THE ADMINISTRATION.

    (a) Report on Required Productive Resources.--Not later than 1 year 
after the effective date of this subsection, the Administration shall 
submit to the Congress a report detailing the types and amounts of 
productive resources (both public and private) needed to advance and 
represent disadvantaged business at all phases and levels of the 
economic system in numbers representative of the relative population of 
disadvantaged individuals in the United States. The report shall 
provide separate recommendations for achieving such representation 
through a phased approach involving short-term and long-term goals and 
objectives.
    (b) Powers and Duties.--(1) In order to achieve the purposes of 
this Act, the Administration shall--
            (A) collect and analyze data, including, but not limited 
        to, the causes for success or failure of businesses owned by 
        the disadvantaged,
            (B) perform evaluations of private and public sector 
        programs designed to assist the development of disadvantaged 
        business; and
            (C) conduct research, studies, and surveys of economic 
        conditions generally and how such conditions particularly 
        affect the development of disadvantaged business.
    (2) The Administration is hereby authorized to provide financial 
assistance by contract, grant, or cooperative agreement to public and 
private organizations to assist the Administration in carrying out the 
provisions of paragraph (1).
    (3) The Administration is hereby authorized to--
            (A) develop and maintain, on a current basis, a data bank 
        on disadvantaged business, except that--
                    (i) such activity shall be conducted in cooperation 
                and consultation with the Associate Administrator for 
                Minority Small Business and Capital Ownership 
                Development of the Small Business Administration, and
                    (ii) such data bank does not duplicate the 
                information stored or capable of being stored by the 
                procurement automated source system (PASS) maintained 
                by the Small Business Administration; and
            (B) establish and maintain an information clearinghouse for 
        the collection and dissemination of demographic, economic, 
        financial, managerial, and technical data pertinent to 
        disadvantaged business and, to this end, to take such steps as 
        the Administration may deem necessary and desirable to search 
        for, collect, classify, coordinate, integrate, record, and 
        catalog such information.

    TITLE V--ADMINISTRATIVE AND OTHER POWERS OF THE ADMINISTRATION; 
                        MISCELLANEOUS PROVISIONS

SEC. 501. ADMINISTRATIVE POWERS.

    In performing the duties under this Act, the Administration is 
authorized to--
            (1) adopt and use a seal for the Minority Business 
        Development Administration which shall be judicially noticed;
            (2) hold hearings, sit and act, and take testimony as the 
        Administration may deem advisable;
            (3) acquire in any lawful manner any property as the 
        Administration may deem necessary or appropriate to conduct the 
        activities authorized in this Act;
            (4) make advance payments under grants, contracts, and 
        cooperative agreements;
            (5) donate without cost (except for costs of care and 
        handling) for use in any Federal, State, or local government or 
        in any recipient nonprofit organization for purposes of the 
        development of disadvantaged business any real or tangible 
        personal property acquired by the Administration under this 
        Act. The Administration may impose reasonable terms, 
        conditions, reservations, and restrictions upon the use of any 
        property donated under this section;
            (6) enter into agreements with other Federal agencies;
            (7) employ experts and consultants or organizations thereof 
        as authorized by section 3109 of title 5, United States Code, 
        to compensate individuals so employed at rates not in excess of 
        the per diem rate authorized for GS-18 of the General Schedule, 
        including traveltime, and allow them travel expenses (including 
        per diem in lieu of subsistence) while away from their homes or 
        regular places of business, as authorized by section 5703 of 
        title 5, United States Code, for persons in the Government 
        service employed intermittently, while so employed; contracts 
        for such employment may be renewed annually;
            (8) sue and be sued in any court of record of a State 
        having general jurisdiction or in any United States district 
        court, and jurisdiction is conferred upon such district court 
        to determine such controversies without regard to the amount in 
        controversy; but no attachment, garnishment, or other similar 
        process, mesne or final, shall be issued against the 
        Administration or its property; nothing in this Act shall be 
        construed to except the activities under this Act from 
        application of sections 507(b), 517, and 2679 of title 28, 
        United States Code; and
            (9) prescribe such rules, regulations, and procedures as 
        the Administration may deem appropriate to carry out this Act.

SEC. 502. AUDITS.

    (a) Recordkeeping Requirement.--Each recipient of assistance under 
this Act shall keep such records as the Administration shall prescribe, 
including records which fully disclose the amount and the disposition 
by the recipient of the proceeds of such assistance, the total cost of 
the undertaking for which such assistance is given or used, the amount 
and nature of that portion of the cost of the undertaking supplied by 
other sources, and such other records as will facilitate an effective 
audit.
    (b) Access by Government Officials.--The Assistant Secretary, the 
Inspector General of the Department of Commerce, and the Comptroller 
General of the United States, or any of their duly authorized 
representatives, shall have access for the purpose of audit, 
investigation, and examination to any books, documents, papers, 
records, and other materials of the recipient which are pertinent to 
the assistance received under this Act.
    (c) Review by Comptroller General.--Not later than 18 months after 
the date of the enactment of this Act, the Comptroller General of the 
United States shall conduct a thorough review of the programs 
authorized by this Act and shall transmit to the Congress a detailed 
report of the Comptroller's findings, including therein an evaluation 
of the effectiveness of the programs authorized to achieve the purpose 
of this Act, a description of any failure to comply with the 
requirements of this Act, and recommendations for corrective 
legislative or administrative action.

SEC. 503. ANNUAL REPORT.

    The Assistant Secretary shall, not later than 120 days after the 
close of each fiscal year, submit to the President a full report of the 
Administration's activities hereunder during the previous fiscal year. 
Further, the Assistant Secretary shall, from time to time, submit to 
the President recommendations for legislation or other actions as the 
Assistant Secretary deems desirable to promote the purposes of this 
Act. Each Federal agency shall consult with the Assistant Secretary on 
a timely basis so that the Assistant Secretary may consider them for 
the Assistant Secretary's report and recommendations to the President.

SEC. 504. SEPARABILITY.

    If any provision of this Act or the application thereof to any 
persons or circumstances shall be adjudged by any court of competent 
jurisdiction to be invalid, such judgment shall not affect, impair, or 
invalidate the remainder of this Act or its application to other 
persons and circumstances, but shall be confined in its operation to 
the provision of this Act or the application thereof to the persons and 
circumstances directly involved in the controversy in which such 
judgment shall have been rendered.

SEC. 505. AUTHORITY OF ASSOCIATE ADMINISTRATOR FOR MINORITY SMALL 
              BUSINESS AND CAPITAL OWNERSHIP DEVELOPMENT.

    (a) In General.--Section 7(j)(11) of the Small Business Act (15 
U.S.C. 636(j)(11)) is amended to read as follows:
            ``(11) The Associate Administrator for Minority Small 
        Business and Capital Ownership Development shall be responsible 
        for coordinating and formulating policies relating to 
        assistance provided by Federal agencies (excluding the Minority 
        Business Development Administration) to small business concerns 
        described in section 7(i) and small business concerns owned and 
        controlled by the socially and economically disadvantaged as 
        defined pursuant to section 8(d).''.
    (b) Construction of Provisions.--Nothing in this Act is intended to 
duplicate or limit any programs or projects administered by the Small 
Business Administration.
    (c) Cooperation by Federal Agencies.--Each Federal agency shall 
cooperate and consult with the Administrator and the Small Business 
Administration to facilitate the accomplishment of the purposes of this 
Act and the Small Business Act.

SEC. 506. AUTHORIZATION FOR APPROPRIATIONS.

    There are hereby authorized to be appropriated such sums as may be 
necessary and appropriate to carry out the provisions and purposes of 
this Act other than those for which appropriations may from time to 
time be specifically authorized.

SEC. 507. TERMINATION OF AUTHORITY UNDER EXECUTIVE ORDER NUMBERED 
              11625.

    Beginning on the date of the enactment of this Act, the powers and 
duties of the Administration shall be determined without regard to 
Executive Order Numbered 11625.

                                 <all>

HR 278 IH----2
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