I
103D CONGRESS
1ST SESSION
H. R. 1057
To protect and promote small business concerns.
IN THE HOUSE OF REPRESENTATIVES
FEBRUARY 23, 1993
Mrs. MEYERS of Kansas introduced the following bill; which was referred
jointly to the Committees on Ways and Means, Small Business, the Judi-
ciary, Rules, and Education and Labor
A BILL
To protect and promote small business concerns.
Be it enacted by the Senate and House of Representa-
tives of the United States of America in Congress assembled,
SECTION 1. SHORT TITLE.
This Act may be cited as the ‘‘Omnibus Small Busi-
ness Promotion and Protection Act of 1993’’.
TITLE I—SMALL BUSINESS TAX
INCENTIVES
SEC. 101. RESEARCH CREDIT.
(a) IN GENERAL.—Section 41 of the Internal Reve-
nue Code of 1986 (relating to credit for increasing re-
search activities) is amended by striking subsection (h).
(b) CONFORMING AMENDMENT.—Paragraph (1) sec-
tion 28(b) of such Code is amended by striking subpara-
graph (D).
(c) EFFECTIVE DATE.—The amendments made by
this section shall apply to taxable years ending after June
30, 1992.
SEC. 102. TARGETED JOBS CREDIT.
(a) IN GENERAL.—Subsection (c) of section 51 of the
Internal Revenue Code of 1986 (relating to amount of tar-
geted jobs credit) is amended by striking paragraph (4).
(b) EFFECTIVE DATE.—The amendment made by
subsection (a) shall apply to individuals who begin work
for the employer after June 30, 1992.
SEC. 103. QUALIFIED SMALL ISSUE BONDS.
(a) IN GENERAL.—Subparagraph (B) of section
144(a)(12) of the Internal Revenue Code of 1986 is
amended to read as follows:
‘‘(B) BONDS
ISSUED
TO
FINANCE
MANUFACTURING
FACILITIES
AND
FARM
PROPERTY.—Subparagraph (A) shall not
apply to any bond issued as part of an
issue 95 percent or more of the net pro-
ceeds of which are to be used to provide—
‘‘(i) any manufacturing facility, or
‘‘(ii) any land or property in accord-
ance with section 147(c)(2).’’
(b) EFFECTIVE DATE.—The amendment made by
subsection (a) shall apply to bonds issued after June 30,
1992.
SEC. 104. EMPLOYER-PROVIDED EDUCATIONAL ASSIST-
ANCE.
(a) IN GENERAL.—Section 127 of the Internal Reve-
nue Code of 1986 (relating to educational assistance pro-
grams) is amended by striking subsection (d) and by re-
designating subsection (e) as subsection (d).
(b) CONFORMING AMENDMENT.—Paragraph (2) of
section 103(a) of the Tax Extension Act of 1991 is hereby
repealed.
(c) EFFECTIVE DATE.—The amendments made by
this section shall apply to taxable years beginning after
June 30, 1992.
SEC. 105. DEDUCTION FOR HEALTH INSURANCE COSTS OF
SELF-EMPLOYED 
INDIVIDUALS 
INCREASED
AND MADE PERMANENT.
(a) IN GENERAL.—Paragraph (1) of section 162(l)
of the Internal Revenue Code of 1986 (relating to special
rules for health insurance costs of self-employed individ-
uals) is amended by striking ‘‘25 percent of’’.
(b) DEDUCTION MADE PERMANENT.—Paragraph (6)
of section 162(l) of such Code is hereby repealed.
(c) EFFECTIVE DATE.—The amendments made by
this section shall apply to taxable years beginning after
June 30, 1992.
TITLE II—INCREASE OF NUMBER
OF PERMITTED S CORPORA-
TION SHAREHOLDERS
SEC. 201. INCREASE OF NUMBER OF PERMITTED S COR-
PORATION SHAREHOLDERS.
(a) IN GENERAL.—Subparagraph (A) of section
1361(b)(1) of the Internal Revenue Code of 1986 (defin-
ing small business corporation) is amended by striking
‘‘35 shareholders’’ and inserting ‘‘50 shareholders’’.
(b) EFFECTIVE DATE.—The amendment made by
this section shall take effect on the date of the enactment
of this Act.
TITLE III—WOMEN-OWNED
SMALL BUSINESS CONCERNS
SEC. 301. PARTICIPATION IN SUBCONTRACTING PRO-
GRAMS.
(a) ELIGIBILITY REQUIREMENTS.—
(1) DEFINITION OF SOCIALLY DISADVANTAGED
SMALL BUSINESS CONCERN.—Section 8(a)(5) of the
Small Business Act (15 U.S.C. 637(a)(5)) is amend-
ed by striking ‘‘racial or ethnic prejudice’’ and in-
serting ‘‘racial, ethnic, or gender-based prejudice’’.
(2) PRESUMPTION
OF
SOCIAL
DISADVANTAGE
UNDER
CONTRACT
CLAUSE.—The contract clause
specified in section (8)(d)(3) of the Small Business
Act (15 U.S.C. 637(d)(3)) is amended by striking
‘‘and other minorities’’ in subparagraph (C) of such
clause and inserting ‘‘other minorities, and women’’.
(b) TREATMENT OF COMMUNITY PROPERTY LAWS.—
The Small Business Act (15 U.S.C. 631 et seq.) is amend-
ed—
(1) in section 8(a)(4) by adding at the end the
following new subparagraph:
‘‘(D) The community property laws of a
jurisdiction shall not be applied in determining
whether a small business concern meets the re-
quirements of this paragraph with regard to
ownership and control.’’;
(2) in section 8(a)(6)(E)—
(A) by striking the period at the end of
clause (ii) and inserting ‘‘; and’’; and
(B) by adding at the end the following new
clause:
‘‘(iii) the value of any property which
is owned by a disadvantaged owner solely
on the basis of application of the commu-
nity property laws of a jurisdiction.’’; and
(3) in the contract clause specified in section
(8)(d)(3) by adding at the end of subparagraph (C)
of such clause the following new sentence: ‘‘The
community property laws of a jurisdiction shall not
be applied in determining whether a small business
concern meets the requirements of this subpara-
graph with regard to ownership and control.’’.
TITLE IV—PREPAYMENT OF DE-
VELOPMENT 
COMPANY 
DE-
BENTURES
SEC. 401. PREPAYMENT OF DEVELOPMENT COMPANY DE-
BENTURES.
(a) IN GENERAL.—Title V of the Small Business In-
vestment Act of 1958 (15 U.S.C. 695 et seq.) is amended
by adding at the end the following new section:
‘‘SEC. 507. PREPAYMENT OF DEVELOPMENT COMPANY DE-
BENTURES.
‘‘(a) IN GENERAL.—(1) If the requirements of sub-
section (b) are met, the issuer of a debenture purchased
by the Federal Financing Bank and guaranteed by the
Administration under section 503 may, at the election of
the borrower whose loan secures such debenture, prepay
such debenture by paying to the Federal Financing Bank,
not later than 2 years after the date of the enactment of
this section, the amount that is equal to the sum of the
unpaid principal balance (plus accrued interest at the cou-
pon rate on the debenture) due on the debenture on the
date of prepayment and the amount of the penalty de-
scribed in paragraph (2)(A).
‘‘(2)(A) The amount of the penalty described in this
paragraph is the amount described in subparagraph (B)
reduced by any fees paid pursuant to subsection (d)(2).
‘‘(B) The amount described in this subparagraph is
the amount equal to the original principal amount of the
debenture—
‘‘(i) multiplied by the interest rate of the deben-
ture;
‘‘(ii) multiplied by the number of years remain-
ing to maturity on the debenture; and
‘‘(iii) divided by the number of years to matu-
rity on the debenture when the debenture was origi-
nally issued.
‘‘(b) REQUIREMENTS.—The requirements of this sub-
section are met if—
‘‘(1) the debenture referred to in subsection (a)
is outstanding on the date of the enactment of this
section and neither the debenture nor the borrower’s
loan that secures the debenture is in default on the
date of prepayment;
‘‘(2) only non-Federal funds are used to prepay
the debenture;
‘‘(3) the issuer extinguishes the borrower’s loan
which secured such debenture;
‘‘(4) in the case of prepayment of a debenture
in which a new debenture is issued and guaranteed
by the Administration under section 503 and sold
under section 504 (or the Administration issues a
trust certificate representing ownership in such new
debenture under section 505) for the purpose of
such prepayment, the issuer certifies that it will
waive any origination fee on the new debenture to
which it otherwise would have been entitled; and
‘‘(5) the borrower certifies that it will pay to
the issuer the amount of the penalty referred to in
subsection (a)(2)(A).
‘‘(c) TRANSFER OF GUARANTEE.—
‘‘(1) IN GENERAL.—Notwithstanding any other
law, in the case of prepayment of a debenture under
subsection (a) in which a new debenture is issued by
a qualified State or local development company and
guaranteed by the Administration under section 503
and sold under section 504 (or the Administration