Union Calendar No. 126
106TH CONGRESS
1ST SESSION
H. R. 413
[Report No. 106–184, Parts I and II]
A BILL
To authorize qualified organizations to provide
technical assistance and capacity building serv-
ices to microenterprise development organizations
and programs and to disadvantaged entre-
preneurs using funds from the Community Devel-
opment Financial Institutions Fund, and for
other purposes.
JULY 2, 1999
Reported from the Committee on Small Business with an
amendment, committed to the Committee of the Whole
House on the State of the Union, and ordered to be
printed
IB
Union Calendar No. 126
106TH CONGRESS
1ST SESSION
H. R. 413
[Report No. 106–184, Parts I and II]
To authorize qualified organizations to provide technical assistance and capac-
ity building services to microenterprise development organizations and
programs and to disadvantaged entrepreneurs using funds from the Com-
munity Development Financial Institutions Fund, and for other purposes.
IN THE HOUSE OF REPRESENTATIVES
JANUARY 19, 1999
Mr. RUSH (for himself, Mr. LEACH, Mr. LAFALCE, Mr. VENTO, Mr. OLVER,
Ms. KILPATRICK, Mrs. MALONEY of New York, Ms. DEGETTE, Mr.
METCALF, and Mr. FRANK of Massachusetts) introduced the following
bill; which was referred to the Committee on Banking and Financial
Services
JUNE 14, 1999
Reported and referred to the Committee on Small Business for consideration
of such provisions of the bill as fall within the jurisdiction of that com-
mittee pursuant to clause 1(o), rule X
JULY 2, 1999
Additional sponsors: Mr. UNDERWOOD, Ms. CARSON, Mr. FILNER, Mr.
STARK, Ms. LEE, Mrs. ROUKEMA, Mr. PASTOR, Ms. LOFGREN, Mr. LAN-
TOS, Mrs. MEEK of Florida, Mr. LUTHER, Mr. DICKS, Mr. UDALL of Col-
orado, Mrs. JONES of Ohio, Mr. GEORGE MILLER of California, Mr.
OBERSTAR, 
Ms. 
ESHOO, 
Mr. 
CAPUANO, 
Mr. 
BILBRAY, 
Mrs.
CHRISTENSEN, Mr. HINCHEY, Mr. BROWN of Ohio, Ms. NORTON, Mr.
COOK, Ms. EDDIE BERNICE JOHNSON of Texas, Mr. MARTINEZ, Ms.
BERKLEY, Mrs. THURMAN, Mr. BALDACCI, Mr. THOMPSON of Mis-
sissippi, Mr. CONYERS, Mr. DIXON, Mr. TAYLOR of North Carolina, Mrs.
CAPPS, Mr. CLEMENT, Mr. BROWN of California, Ms. WOOLSEY, Mr.
DAVIS of Illinois, Mr. MEEKS of New York, Mr. GONZALEZ, Ms.
SCHAKOWSKY, Mr. FALEOMAVAEGA, Mr. BECERRA, Mr. PRICE of North
Carolina, Mr. BENTSEN, Mr. HALL of Ohio, Mr. BOUCHER, Mr. BOEH-
LERT, Mr. GEJDENSON, Ms. MCKINNEY, Mr. BARRETT of Wisconsin, Ms.
•HR 413 RH2
JACKSON-LEE of Texas, Mr. MCCOLLUM, Mrs. KELLY, Mr. ANDREWS,
Mr. CAMPBELL, Mr. FARR of California, Mr. INSLEE, Mr. LEWIS of
Georgia, Mr. SMITH of New Jersey, Mrs. MORELLA, Mr. MICA, Mr.
GUTIERREZ, Mr. ACKERMAN, Mrs. WILSON, Mr. WALSH, Mr. SPENCE,
Mrs. CLAYTON, Mr. JEFFERSON, Ms. BROWN of Florida, Mr. HILLIARD,
Mr. TOWNS, Mr. THOMPSON of California, Mr. OWENS, Mr. FROST, Mr.
HASTINGS of Florida, Mr. PAYNE, Mr. NEAL of Massachusetts, Mrs.
MINK of Hawaii, Mr. LUCAS of Oklahoma, Ms. MILLENDER-MCDONALD,
Mr. HINOJOSA, Ms. ROYBAL-ALLARD, Mr. RANGEL, Mr. WATTS of Okla-
homa, Mr. SHERMAN, Mr. MOORE, Mr. GREENWOOD, Mrs. MCCARTHY
of New York, Ms. HOOLEY of Oregon, Mr. LAMPSON, Mr. ALLEN, Mr.
WYNN, Mrs. TAUSCHER, Mr. HOLT, Mr. CASTLE, Mr. FATTAH, Mr.
UDALL of New Mexico, Mr. ABERCROMBIE, and Mr. BERMAN
JULY 2, 1999
Reported from the Committee on Small Business with an amendment, com-
mitted to the Committee of the Whole House on the State of the Union,
and ordered to be printed
[Strike out all after the enacting clause and insert the part printed in italic]
A BILL
To authorize qualified organizations to provide technical as-
sistance and capacity building services to microenterprise
development organizations and programs and to dis-
advantaged entrepreneurs using funds from the Commu-
nity Development Financial Institutions Fund, and for
other purposes.
Be it enacted by the Senate and House of Representa-
tives of the United States of America in Congress assembled,
SECTION 1. PROVISION OF TECHNICAL ASSISTANCE TO
MICROENTERPRISES.
Title I of the Riegle Community Development and
Regulatory Improvement Act of 1994 (12 U.S.C. 4701 et
•HR 413 RH2
seq.) is amended by adding at the end the following new
subtitle:
‘‘Subtitle C—Microenterprise Tech-
nical
Assistance
and
Capacity
Building Program
‘‘SEC. 171. SHORT TITLE.
‘‘This subtitle may be cited as the ‘Program for In-
vestment in Microentrepreneurs Act of 1999’, also re-
ferred to as the ‘PRIME Act’.
‘‘SEC. 172. DEFINITIONS.
‘‘For purposes of this subtitle—
‘‘(1) the term ‘Administrator’ has the same
meaning as in section 103;
‘‘(2) the term ‘capacity building services’ means
services provided to an organization that is, or is in
the process of becoming a microenterprise develop-
ment organization or program, for the purpose of
enhancing its ability to provide training and services
to disadvantaged entrepreneurs;
‘‘(3) the term ‘collaborative’ means 2 or more
nonprofit entities that agree to act jointly as a quali-
fied organization under this subtitle;
‘‘(4)
the
term
‘disadvantaged
entrepreneur’
means a microentrepreneur that is—
‘‘(A) a low-income person;
•HR 413 RH2
‘‘(B) a very low-income person; or
‘‘(C) an entrepreneur that lacks adequate
access to capital or other resources essential for
business success, or is economically disadvan-
taged, as determined by the Administrator;
‘‘(5) the term ‘Fund’ has the same meaning as
in section 103;
‘‘(6) the term ‘Indian tribe’ has the same mean-
ing as in section 103;
‘‘(7) the term ‘intermediary’ means a private,
nonprofit entity that seeks to serve microenterprise
development organizations and programs as author-
ized under section 175;
‘‘(8) the term ‘low-income person’ has the same
meaning as in section 103;
‘‘(9) the term ‘microentrepreneur’ means the
owner or developer of a microenterprise;
‘‘(10) the term ‘microenterprise’ means a sole
proprietorship, partnership, or corporation that—
‘‘(A) has fewer than 5 employees; and
‘‘(B) generally lacks access to conventional
loans, equity, or other banking services;
‘‘(11) the term ‘microenterprise development or-
ganization or program’ means a nonprofit entity, or
a program administered by such an entity, including
•HR 413 RH2
community development corporations or other non-
profit development organizations and social service
organizations, that provides services to disadvan-
taged entrepreneurs or prospective entrepreneurs;
‘‘(12) the term ‘training and technical assist-
ance’ means services and support provided to dis-
advantaged
entrepreneurs
or
prospective
entre-
preneurs, such as assistance for the purpose of en-
hancing business planning, marketing, management,
financial management skills, and assistance for the
purpose of accessing financial services; and
‘‘(13) the term ‘very low-income person’ means
having an income, adjusted for family size, of not
more than 150 percent of the poverty line (as de-
fined in section 673(2) of the Community Services
Block Grant Act (42 U.S.C. 9902(2), including any
revision required by that section).
‘‘SEC. 173. ESTABLISHMENT OF PROGRAM.
‘‘The Administrator shall establish a microenterprise
technical assistance and capacity building grant program
to provide assistance from the Fund in the form of grants
to qualified organizations in accordance with this subtitle.
‘‘SEC. 174. USES OF ASSISTANCE.
‘‘A qualified organization shall use grants made
under this subtitle—
•HR 413 RH2
‘‘(1) to provide training and technical assist-
ance to disadvantaged entrepreneurs;
‘‘(2) to provide training and capacity building
services to microenterprise development organiza-
tions and programs and groups of such organiza-
tions to assist such organizations and programs in
developing microenterprise training and services;
‘‘(3) to aid in researching and developing the
best practices in the field of microenterprise and
technical assistance programs for disadvantaged en-
trepreneurs; and
‘‘(4) for such other activities as the Adminis-
trator determines are consistent with the purposes of
this subtitle.
‘‘SEC. 175. QUALIFIED ORGANIZATIONS.
‘‘For purposes of eligibility for assistance under this
subtitle, a qualified organization shall be—
‘‘(1) a nonprofit microenterprise development
organization or program (or a group or collaborative
thereof) that has a demonstrated record of delivering
microenterprise
services
to
disadvantaged
entre-
preneurs;
‘‘(2) an intermediary;
‘‘(3) a microenterprise development organiza-
tion or program that is accountable to a local com-
•HR 413 RH2
munity, working in conjunction with a State or local
government or Indian tribe; or
‘‘(4) an Indian tribe acting on its own, if the
Indian tribe can certify that no private organization
or program referred to in this paragraph exists with-
in its jurisdiction.
‘‘SEC. 176. ALLOCATION OF ASSISTANCE; SUBGRANTS.
‘‘(a) ALLOCATION OF ASSISTANCE.—
‘‘(1) IN GENERAL.—The Administrator shall al-
locate assistance from the Fund under this subtitle
to ensure that—
‘‘(A) activities described in section 174(1)
are funded using not less than 75 percent of
amounts made available for such assistance;
and
‘‘(B) activities described in section 174(2)
are funded using not less than 15 percent of
amounts made available for such assistance.
‘‘(2) LIMIT ON INDIVIDUAL ASSISTANCE.—No
single organization or entity may receive more than
10 percent of the total funds appropriated under
this subtitle in a single fiscal year.
‘‘(b) TARGETED ASSISTANCE.—The Administrator
shall ensure that not less than 50 percent of the grants
made under this subtitle are used to benefit very low-in-
•HR 413 RH2
come persons, including those residing on Indian reserva-
tions.
‘‘(c) SUBGRANTS AUTHORIZED.—
‘‘(1) IN GENERAL.—A qualified organization re-
ceiving assistance under this subtitle may provide
grants using that assistance to qualified small and
emerging
microenterprise
organizations
and
pro-
grams, subject to such rules and regulations as the
Administrator determines to be appropriate.
‘‘(2) LIMIT ON ADMINISTRATIVE EXPENSES.—
Not more than 7.5 percent of assistance received by
a qualified organization under this subtitle may be
used for administrative expenses in connection with
the making of subgrants under paragraph (1).
‘‘(d) DIVERSITY.—In making grants under this sub-
title, the Administrator shall ensure that grant recipients
include both large and small microenterprise organiza-
tions, serving urban, rural, and Indian tribal communities
and racially and ethnically diverse populations.
‘‘SEC. 177. MATCHING REQUIREMENTS.
‘‘(a) IN GENERAL.—Financial assistance under this
subtitle shall be matched with funds from sources other
than the Federal Government on the basis of not less than
50 percent of each dollar provided by the Fund.
•HR 413 RH2
‘‘(b) SOURCES OF MATCHING FUNDS.—Fees, grants,
gifts, funds from loan sources, and in-kind resources of
a grant recipient from public or private sources may be
used to comply with the matching requirement in sub-
section (a).
‘‘(c) EXCEPTION.—
‘‘(1) IN GENERAL.—In the case of an applicant
for assistance under this subtitle with severe con-
straints on available sources of matching funds, the
Administrator may reduce or eliminate the matching
requirements of subsection (a).
‘‘(2) LIMITATION.—Not more than 10 percent
of the total funds made available from the Fund in
any fiscal year to carry out this subtitle may be ex-
cepted from the matching requirements of subsection
(a), as authorized by paragraph (1) of this sub-
section.
‘‘SEC. 178. APPLICATIONS FOR ASSISTANCE.
‘‘An application for assistance under this subtitle
shall be submitted in such form and in accordance with
such procedures as the Fund shall establish.
‘‘SEC. 179. RECORDKEEPING.
‘‘The requirements of section 115 shall apply to a
qualified organization receiving assistance from the Fund
under this subtitle as if it were a community development
•HR 413 RH2
financial institution receiving assistance from the Fund
under subtitle A.
‘‘SEC. 180. AUTHORIZATION.
‘‘In addition to funds otherwise authorized to be ap-
propriated to the Fund to carry out this title, there are
authorized to be appropriated to the Fund to carry out
this subtitle—
‘‘(1) $15,000,000 for fiscal year 2000;
‘‘(2) $25,000,000 for fiscal year 2001;
‘‘(3) $30,000,000 for fiscal year 2002; and
‘‘(4) $35,000,000 for fiscal year 2003.
‘‘SEC. 181. IMPLEMENTATION.
‘‘The Administrator shall, by regulation, establish
such requirements as may be necessary to carry out this
subtitle.’’.
SEC. 2. ADMINISTRATIVE EXPENSES.
Section 121(a)(2)(A) of the Riegle Community Devel-
opment and Regulatory Improvement Act of 1994 (12
U.S.C. 4718(a)(2)(A)) is amended—
(1) by striking ‘‘$5,550,000’’ and inserting
‘‘$6,100,000’’; and
(2) in the first sentence, by inserting before the
period ‘‘, including costs and expenses associated
with carrying out subtitle C’’.
•HR 413 RH2
SEC. 3. CONFORMING AMENDMENTS.
Section 104(d) of the Riegle Community Develop-
ment and Regulatory Improvement Act of 1994 (12
U.S.C. 4703(d)) is amended—
(1) in paragraph (2)—
(A) by striking ‘‘15’’ and inserting ‘‘17’’;
(B) in subparagraph (G)—
(i)
by
striking
‘‘9’’
and
inserting
‘‘11’’;
(ii) by redesignating clauses (iv) and
(v) as clauses (v) and (vi), respectively;
and
(iii) by inserting after clause (iii) the
following:
‘‘(iv) 2 individuals who have expertise
in microenterprises and microenterprise de-
velopment;’’; and
(2) in paragraph (4), in the first sentence, by
inserting before the period ‘‘and subtitle C’’.
SECTION 1. PROVISION OF TECHNICAL ASSISTANCE TO
MICROENTERPRISES.
Title I of the Riegle Community Development and
Regulatory Improvement Act of 1994 (12 U.S.C. 4701 et
seq.) is amended by adding at the end the following new
subtitle:
•HR 413 RH2
‘‘Subtitle C—Microenterprise Tech-
nical Assistance and Capacity
Building Program
‘‘SEC. 171. SHORT TITLE.
‘‘This subtitle may be cited as the ‘Program for Invest-
ment in Microentrepreneurs Act of 1999’, also referred to
as the ‘PRIME Act’.
‘‘SEC. 172. DEFINITIONS.
‘‘For purposes of this subtitle—
‘‘(1) the term ‘Administrator’ has the same
meaning as in section 103;
‘‘(2) the term ‘capacity building services’ means
services provided to an organization that is, or is in
the process of becoming, a microenterprise develop-
ment organization or program, for the purpose of en-
hancing its ability to provide training and services to
disadvantaged entrepreneurs;
‘‘(3) the term ‘collaborative’ means, with respect
to 2 or more nonprofit entities, having agreed to act
jointly as a qualified organization under this subtitle;
‘‘(4) the term ‘disadvantaged entrepreneur’
means a microentrepreneur that is—
‘‘(A) a low-income person;
‘‘(B) a very low-income person; or
•HR 413 RH2
‘‘(C) an entrepreneur who lacks adequate
access to capital or other resources essential for
business success, or is economically disadvan-
taged, as determined by the Administrator;
‘‘(5) the term ‘Fund’ has the same meaning as
in section 103;
‘‘(6) the term ‘Indian tribe’ has the same mean-
ing as in section 103;
‘‘(7) the term ‘intermediary’ means a private,
nonprofit entity that seeks to serve microenterprise
development organizations and programs;
‘‘(8) the term ‘low-income person’ has the same
meaning as in section 103;
‘‘(9) the term ‘microentrepreneur’ means the
owner or developer of a microenterprise;
‘‘(10) the term ‘microenterprise’ means a sole
proprietorship, partnership, or corporation that—
‘‘(A) has fewer than 5 employees; and
‘‘(B) generally lacks access to conventional
loans, equity, or other banking services;
‘‘(11) the term ‘microenterprise development or-
ganization or program’ means a nonprofit entity, or
a program administered by such an entity, including
community development corporations or other non-
profit development organizations and social service
•HR 413 RH2
organizations, that provides services to disadvantaged
entrepreneurs or prospective entrepreneurs;
‘‘(12) the term ‘training and technical assist-
ance’ means services and support provided to dis-
advantaged 
entrepreneurs 
or 
prospective 
entre-
preneurs, such as assistance for the purpose of en-
hancing business planning, marketing, management,
financial management skills, and assistance for the
purpose of accessing financial services; and
‘‘(13) the term ‘very low-income person’ means
having an income, adjusted for family size, of not
more than 150 percent of the poverty line (as defined
in section 673(2) of the Community Services Block
Grant Act (42 U.S.C. 9902(2), including any revision
required by that section).
‘‘SEC. 173. ESTABLISHMENT OF PROGRAM.
‘‘The Administrator shall establish a microenterprise
technical assistance and capacity building grant program
to provide assistance from the Fund in the form of grants
to qualified organizations in accordance with this subtitle.
‘‘SEC. 174. USES OF ASSISTANCE.
‘‘A qualified organization shall use grants made under
this subtitle—
‘‘(1) to provide training and technical assistance
to disadvantaged entrepreneurs;
•HR 413 RH2
‘‘(2) to provide training and capacity building
services to microenterprise development organizations
and programs and groups of such organizations to as-
sist such organizations and programs in developing
microenterprise training and services;
‘‘(3) to aid in researching and developing the
best practices in the field of microenterprise and tech-
nical assistance programs for disadvantaged entre-
preneurs; and
‘‘(4) for such other activities as the Adminis-
trator determines are consistent with the purposes of
this subtitle, except that grant amounts may not be
used to make loans of any kind.
‘‘SEC. 175. QUALIFIED ORGANIZATIONS.
‘‘For purposes of eligibility for assistance under this
subtitle, a qualified organization shall be—
‘‘(1) a nonprofit microenterprise development or-
ganization or program (or a group or collaborative
thereof) that has a demonstrated record of delivering
microenterprise services to disadvantaged entre-
preneurs;
‘‘(2) an intermediary;
‘‘(3) a microenterprise development organization
or program that is accountable to a local community,
•HR 413 RH2
and is working in conjunction with a State or local
government or Indian tribe; or
‘‘(4) an Indian tribe acting on its own, if the In-
dian tribe certifies that no private organization or
program referred to in this paragraph exists within
its jurisdiction.
‘‘SEC. 176. ALLOCATION OF ASSISTANCE; SUBGRANTS.
‘‘(a) ALLOCATION OF ASSISTANCE.—
‘‘(1) IN GENERAL.—The Administrator shall al-
locate assistance from the Fund under this subtitle to
ensure that—
‘‘(A) activities described in section 174(1)
are funded using not less than 75 percent of
amounts made available for such assistance; and
‘‘(B) activities described in section 174(2)
are funded using not less than 15 percent of
amounts made available for such assistance.
‘‘(2) LIMIT
ON
INDIVIDUAL
ASSISTANCE.—No
single organization or entity may receive more than
10 percent of the total funds appropriated under this
subtitle in a single fiscal year.
‘‘(b) TARGETED
ASSISTANCE.—The Administrator
shall ensure that not less than 50 percent of the grants made
under this subtitle are used to benefit very low-income per-
sons, including those residing on Indian reservations.