‘‘(II) a prime contractor receiving specific
and credible information that an actual or pro-
spective subcontractor or supplier has falsely
certified its status as a small business concern
owned and controlled by socially and economi-
cally disadvantaged individuals;
‘‘(III) a contracting officer receiving a self-
certification regarding an actual or prospective
contractor’s status, which such officer reason-
ably believes to be false; or
‘‘(IV) the Associate Administrator for Mi-
nority Enterprise Development.
‘‘(iii) The Office of Hearings and Appeals shall
hear appeals regarding the status of a concern as a
small business concern owned and controlled by so-
cially and economically disadvantaged individuals for
purposes of any program or activity conducted under
section 8(d) or any other Federal law that refers to
such section for a definition of program eligibility.
‘‘(iv) A decision issued pursuant to clause (iii)
shall—
‘‘(I) be made available to all parties to the
proceeding;
‘‘(II) be published in full text; and
‘‘(III) include findings of fact and conclu-
sions of law, with specific reasons supporting
such findings and conclusions, on each material
issue of fact and law of decisional significance
regarding the disposition of the protest.
‘‘(v) A decision issued pursuant to clause (iii)
shall be considered a final agency action, and shall
be subject to judicial review under section 553 of
title 5, United States Code.
‘‘(vi) If a firm engages in a pattern of misrepre-
sentations regarding the status of the firm in viola-
tion of section 16(d)(1), the Administration or the
aggrieved executive agency shall initiate an action to
impose an appropriate penalty under section
16(d)(2).’’.
SEC. 107. CONTINUED PROGRAM PARTICIPATION.
Section 7(j)(11)(D) of the Small Business Act (15
U.S.C. 636(j)(11)(D)) is amended to read as follows:
‘‘(D)(i) A Program Participant shall remain eligible
for participation in the Program after a transfer of an
ownership interest in the firm if ownership and control
(as required by section 8(a)(4)) is retained by the socially
and economically disadvantaged individuals upon whom
Program eligibility is based.
‘‘(ii) A Program Participant shall remain eligible for
participation in the Program after transfer of ownership
and control (as required by section 8(a)(4)) to individuals
who are determined to be socially and economically dis-
advantaged pursuant to section 8(a). Unless graduated or
terminated, the Program Participant shall be eligible for
a period of continued Program participation not to exceed
the period described in paragraph (15).
‘‘(iii) A Program Participant that is a tribally owned
corporation may remain eligible for participation in the
Program with other than a Native American as the firm’s
chief executive officer (or chief operating officer), if the
governing body of the Indian tribe certifies to the Admin-
istration that it was unable to hire a qualified Native
American after conducting a national recruitment for such
an individual.’’.
SEC. 108. PROGRAM ADMISSION.
Section 7(j)(11)(F) of the Small Business Act (15
U.S.C. 636(j)(11)(F)) is amended to read as follows:
‘‘(F) Subject to the provisions of section 8(a)(9), the
Division shall—
‘‘(i) make recommendations on requests for re-
consideration of denied applications for entry into
Phase III of the Program to the Associate Adminis-
trator for Minority Enterprise Development;
‘‘(ii) make requests for the initiation of suspen-
sion, termination, or graduation proceedings, as ap-
propriate, to the Associate Administrator for Minor-
ity Enterprise Development; and
‘‘(iii) implement such policy directives as may
be issued by the Associate Administrator for Minor-
ity Enterprise Development pursuant to subpara-
graph (I) regarding, among other things, the geo-
graphic distribution of concerns to be admitted into
the Program and the industrial makeup of such con-
cerns.’’.
SEC. 109. PROGRAM PHASES.
(a) ESTABLISHMENT.—Section 7(j)(12) of the Small
Business Act (15 U.S.C. 636(j)(12)) is amended to read
as follows:
‘‘(12)(A) The Administration shall segment the Pro-
gram into 3 phases: a startup phase, a developmental
phase, and a section 8(a) contracting phase, which shall
be known as Phase I, Phase II, and Phase III, respec-
tively.
‘‘(B) The startup phase of program participation
shall be designed to assist newly formed or forming con-
cerns in overcoming their economic disadvantage by pro-
viding such assistance as may be necessary and appro-
priate to achieve a business foundation adequate for fu-
ture growth.
‘‘(C) The developmental stage of program participa-
tion shall be designed to assist the concern in its effort
to overcome its economic disadvantage by providing such
assistance as may be necessary and appropriate to access
its markets and to strengthen its financial and managerial
skills.
‘‘(D) The section 8(a) contracting stage of program
participation shall be designed to overcome, insofar as
practicable, the remaining elements of economic disadvan-
tage, and to further develop the concern towards economic
viability.’’.
(b) MAXIMUM PERIOD OF PARTICIPATION IN EACH
PHASE.—Section 7(j)(15) of the Small Business Act (15
U.S.C. 636(j)(15)) is amended to read as follows:
‘‘(15) An eligible small business concern may receive
developmental assistance under the Program for the fol-
lowing periods as measured from the date of entry into
the applicable phase of the Program—
‘‘(A) not more than 2 years may be spent in
Phase I of program participation;
‘‘(B) not more than 3 years may be spent in
Phase II of program participation; and
‘‘(C) not more than 9 years may be spent in
Phase III of program participation.’’.
SEC. 110. DEVELOPMENTAL ASSISTANCE AUTHORIZED FOR
PROGRAM PARTICIPANTS.
Section 7(j)(13) of the Small Business Act (15
U.S.C. 636(j)) is amended—
(1) in the matter preceding subparagraph (A),
by striking ‘‘during the stages of program participa-
tion specified in paragraph 12’’ and inserting ‘‘dur-
ing its term of participation in the Program’’; and
(2) by striking subparagraph (J).
SEC. 111. TEST PROGRAM FOR USE OF SURETY BOND
WAIVERS.
Section 7(j)(13)(D) of the Small Business Act (15
U.S.C. 636(j)(13)(D)) is amended—
(1) by striking clauses (i) through (iii);
(2) by striking ‘‘(D) A maximum’’ and inserting
‘‘(D)(i) A maximum’’;
(3) by striking ‘‘, except that, such exemptions
may be granted under this subparagraph only if—
’’ and inserting a period; and
(4) by adding at the end the following new
clauses:
‘‘(ii) The agency with contracting authority
may, upon the request of the Program Partici-