I
103D CONGRESS
2D SESSION
H. R. 4801
To amend the Small Business Act, and for other purposes.
IN THE HOUSE OF REPRESENTATIVES
JULY 20, 1994
Mr. LAFALCE (for himself, Mr. SMITH of Iowa, Mr. SKELTON, Mr. MAZZOLI,
Mr. WYDEN, Mr. BILBRAY, Mr. MFUME, Mr. KLINK, Ms. ROYBAL-
ALLARD, Mr. HILLIARD, and Mr. THOMPSON of Mississippi) introduced
the following bill; which was referred to the Committee on Small Business
A BILL
To amend the Small Business Act, and for other purposes.
Be it enacted by the Senate and House of Representa-
tives of the United States of America in Congress assembled,
That this Act may be cited as the ‘‘Small Business Reau-
thorization and Amendment Act of 1994’’.
TITLE I—AUTHORIZATIONS
SEC. 101. AUTHORIZATIONS.
Section 20 of the Small Business Act (15 U.S.C. 631
note) is amended by striking all of such section after sub-
section (k), as added by section 115(a) of the Small Busi-
ness Credit and Business Opportunity Enhancement Act
of 1992, and by inserting in lieu thereof the following:
‘‘(l) The following program levels are authorized for
fiscal year 1995:
‘‘(1) For the programs authorized by this Act,
the 
Administration 
is 
authorized 
to 
make
$142,000,000 in direct and immediate participation
loans; and of such sum, the Administration is au-
thorized to make $12,000,000 in loans as provided
in section 7(a)(10) and $130,000,000 in loans as
provided in section 7(m).
‘‘(2) For the programs authorized by this Act,
the 
Administration 
is 
authorized 
to 
make
$12,320,000,000 in deferred participation loans and
other financings. Of such sum, the Administration is
authorized to make—
‘‘(A) $9,315,000,000 in general business
loans as provided in section 7(a);
‘‘(B) $2,200,000,000 in financings as pro-
vided in section 7(a)(13) and section 504 of the
Small Business Investment Act of 1958; and
‘‘(C) $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 Ad-
ministration is authorized to make—
‘‘(A) $33,000,000 in purchases of pre-
ferred securities;
‘‘(B) $285,000,000 in guarantees of de-
bentures, of which $55,000,000 is authorized in
guarantees of debentures from companies oper-
ating pursuant to section 301(d) of such Act;
and
‘‘(C) $500,000,000 in guarantees of par-
ticipating 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 ap-
proved pursuant to the provisions of section
411(a)(3) of such Act.
‘‘(5) For the Service Corps of Retired Execu-
tives program authorized by section 8(b)(1) of this
Act, the Administration is authorized to make
grants or enter cooperative agreements not to exceed
$3,500,000, and for the small business institute pro-
gram authorized by section 8(b)(1) of this Act, the
Administration is authorized to make grants or
enter 
cooperative 
agreements 
not 
to 
exceed
$3,000,000.
‘‘(m) 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 dis-
aster 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.
‘‘(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
$208,000,000 in direct and immediate participation
loans; and of such sum the Administration is author-
ized to make $13,000,000 in loans as provided in
section 7(a)(10) and $195,000,000 in loans as pro-
vided in section 7(m).
‘‘(2) For the programs authorized by this Act,
the 
Administration 
is 
authorized 
to 
make
$14,610,000,000 in deferred participation loans and
other financings. Of such sum, the Administration is
authorized to make—
‘‘(A) $10,935,000,000 in general business
loans as provided in section 7(a);
‘‘(B) $2,500,000,000 in financings as pro-
vided in section 7(a)(13) and section 504 of the
Small Business Investment Act of 1958; and
‘‘(C) $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 Ad-
ministration is authorized to make—
‘‘(A) $39,000,000 in purchases of pre-
ferred securities;
‘‘(B) $405,000,000 in guarantees of de-
bentures, of which $55,000,000 is authorized in
guarantees of debentures from companies oper-
ating pursuant to section 301(d) of such Act;
and
‘‘(C) $750,000,000 in guarantees of par-
ticipating 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 ap-
proved pursuant to the provisions of section
411(a)(3) of such Act.
‘‘(5) For the Service Corps of Retired Execu-
tives program authorized by section 8(b)(1) of this
Act, the Administration is authorized to make
grants or enter cooperative agreements not to exceed
$3,675,000, and for the small business institute pro-
gram authorized by section 8(b)(1) of this Act, the
Administration is authorized to make grants or
enter 
cooperative 
agreements 
not 
to 
exceed
$3,150,000.
‘‘(o) 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 dis-
aster 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.
‘‘(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
$284,000,000 in direct and immediate participation
loans; and of such sum the Administration is author-
ized to make $14,000,000 in loans as provided in
section 7(a)(10) and $270,000,000 in loans as pro-
vided in section 7(m).
‘‘(2) For the programs authorized by this Act,
the 
Administration 
is 
authorized 
to 
make
$18,875,000,000 in deferred participation loans and
other financings. Of such sum, the Administration is
authorized to make—
‘‘(A) $14,175,000,000 in general business
loans as provided in section 7(a);
‘‘(B) $3,000,000,000 in financings as pro-
vided in section 7(a)(13) and section 504 of the
Small Business Investment Act of 1958; and
‘‘(C) $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 Ad-
ministration is authorized to make—
‘‘(A) $45,000,000 in purchases of pre-
ferred securities;
‘‘(B) $555,000,000 in guarantees of de-
bentures, of which $55,000,000 is authorized in
guarantees of debentures from companies oper-
ating pursuant to section 301(d) of such Act;
and
‘‘(C) $1,125,000,000 in guarantees of par-
ticipating 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 ap-
proved pursuant to the provisions of section
411(a)(3) of such Act.
‘‘(5) For the Service Corps of Retired Execu-
tives program authorized by section 8(b)(1) of this
Act, the Administration is authorized to make
grants or enter cooperative agreements not to exceed
$3,860,000, and for the small business institute pro-
gram authorized by section 8(b)(1) of this Act, the
Administration is authorized to make grants or
enter 
cooperative 
agreements 
not 
to 
exceed
$3,310,000.
‘‘(q) 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 expenses and necessary loan capital for dis-
aster 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.’’.
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 the following new para-
graph at the end:
‘‘(12) 
DEFERRED
PARTICIPATION
LOAN
PILOT.—During fiscal years 1995 through 1997, on
a pilot basis, in lieu of making direct loans to
intermediaries as authorized in paragraph (1)(B),
the Administration may participate on a deferred
basis of up to 100 percent on loans made to
intermediaries by a for-profit or non-profit entity or
by alliances of such entities subject to the following
conditions:
‘‘(A) NUMBER OF LOANS.—The Adminis-
tration shall not participate in providing financ-
ing on a deferred basis to more than ten
intermediaries in urban areas per year and to
more than ten intermediaries in rural areas per
year.
‘‘(B) TERM OF LOANS.—The term of such
loans shall be ten years. During the first five
years of the loan, the intermediary shall be re-
quired to pay interest only; and during the sec-
ond five years of the loan, the intermediary
shall be required to fully amortize principal and
interest payments.
‘‘(C) INTEREST RATE.—The interest rate
on such loans shall be the rate specified by
paragraph (3)(F) for direct loans.’’.
SEC. 202. MICROLOAN STATE LIMITATION.
Section 7(m)(7)(C) of the Small Business Act (15
U.S.C. 636(m)(7)(C)) is repealed.
SEC. 203. LIMIT ON PARTICIPATION.
Section 7(m)(7)(A) of the Small Business Act (15
U.S.C. 636(m)(7)(A)) is amended to read as follows:
‘‘(A) NUMBER OF PARTICIPANTS.—During
this demonstration program, the Administration
is authorized to fund, on a competitive basis,
not more than 240 microloan programs.’’.
SEC. 204. EQUITABLE DISTRIBUTION.
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, the Administration shall select participa-
tion by such intermediaries as will ensure appro-
priate availability of loans to small businesses lo-
cated in urban areas and in rural areas.’’.
‘‘(B) if the total amount outstanding and
committed (on a deferred basis) solely for the
purposes provided in paragraph (16) to the bor-
rower 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’’.
SEC. 208. 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 under paragraph
(16).’’.
SEC. 209. ACCREDITED LENDERS PROGRAM.
(a) 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) The Administration is authorized to establish an
Accredited Lenders Program for qualified State and local
development companies which meet the requirements of
subsection (b).
‘‘(b) The Administration may designate a qualified
State or local development company as an accredited lend-
er if such company—
‘‘(1) has been an active participant in the devel-
opment company program for at least the last 12
months;
‘‘(2) has well-trained, qualified personnel who
are knowledgeable in the Administration’s lending
policies and procedures for the development company
program;
‘‘(3) has the ability to process, close, and serv-
ice financing for plant and equipment under section
502 of this Act;
‘‘(4) has a loss rate on its debentures that is
acceptable to the Administration;
‘‘(5) has a history of submitting to the Admin-
istration complete and accurate debenture guaranty
application packages; and
‘‘(6) has demonstrated the ability to serve small
business credit needs for financing plant and equip-
ment as provided in section 502 of this Act.
‘‘(c) The Administration shall expedite the processing
of 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) The designation of a qualified State or local de-
velopment company as an accredited lender may be sus-
pended or revoked if the Administration determines that
the development company has not continued to meet the
criteria for eligibility under subsection (b) or that the de-
velopment company has failed to adhere to the Adminis-
tration’s rules and regulations or is violating any other
applicable provision of law. Suspension or revocation shall
not affect any outstanding debenture guarantee.
‘‘(e) For purposes of this section, the term ‘qualified
State or local development company’ has the same mean-
ing as in section 503(e).’’.
(b) The Administration shall promulgate regulations
to carry out this section within 90 days of the date of
the enactment of this Act.
(c) The Administration shall report to the Small
Business Committee of the United States Senate and to
the Small Business Committee of the United States House
of Representatives within one year, and annually there-
after, on the implementation of this section, specifically
including data on the number of development companies
designated as accredited lenders, their debenture guaran-
tee volume, their loss rates, and the average processing
time on their guarantee applications, along with such
other information as the Administration deems appro-
priate.
SEC. 210. PREMIER LENDERS PROGRAM.
(a) Title V of the Small Business Investment Act of
1958 (15 U.S.C. 695 et seq.) is further amended by add-
ing at the end the following new section:
‘‘SEC. 508. PREMIER LENDERS PROGRAM.
‘‘(a) The Administration is authorized to establish a
Premier Lenders Program for certified development com-
panies which meet the requirements of subsection (b).
‘‘(b) The Administration may designate a participant
in the accredited lenders program as a premier lender if
such company—
‘‘(1) has been an active participant in the ac-
credited lenders program for at least the last 12
months: Provided, That prior to January 1, 1996,
the Administration may waive this provision if the
applicant is qualified to participate in the accredited
lenders program;
‘‘(2) has a history of submitting to the Admin-
istration adequately analyzed debenture guarantee
application packages; and
‘‘(3) agrees to assume and to reimburse the Ad-
ministration for 5 percent of any loss sustained by
the Administration on account of default by the cer-
tified development company in the payment of prin-
cipal or interest on a debenture issued by such com-
pany and guaranteed by the Administration under
this section.
‘‘(c) Upon approval of an applicant as a premier lend-
er, the certified development company shall establish a loss
reserve in an amount equal to the anticipated losses to
the certified development company pursuant to subsection
(b)(3) based upon the historic loss rate on debentures is-
sued by such company, or 3 percent of the aggregate prin-
cipal amount of debentures issued by such company and
guaranteed by the Administration under this section,
whichever is greater. The loss reserve shall be comprised
of segregated assets of the development company which
shall be securitized in favor of the Administration or of
such unqualified letters of credit or indemnity agreements
from a third party as the Administration deems appro-
priate.
‘‘(d) Upon designation and qualification of a com-
pany as a premier lender, and subject to such terms and
conditions as the Administration may determine, and not-
withstanding the provisions of section 503(b)(6), the Ad-
ministration may permit a premier lender to approve loans
to be funded with the proceeds of and to authorize the
guarantee of a debenture issued by such company. The
approval by the premier lender shall be subject to the final
approval as to eligibility of any such guarantee by the Ad-
ministration pursuant to subsection 503(a) of this Act,
but such final approval shall not include decisions by the
company involving creditworthiness, loan closing, or com-
pliance with legal requirements imposed by law or regula-
tion.
‘‘(e) The designation of a qualified State or local de-
velopment company as a premier lender may be suspended
or revoked if the Administration determines that the com-
pany—
‘‘(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); or
‘‘(3) is failing to adhere to the Administration’s
rules and regulations or is violating any other appli-
cable provision of law.
‘‘(f) Suspension or revocation shall not affect any out-
standing debenture guarantee.’’.
(b) The Administration shall promulgate such regula-
tions to carry out this section within 180 days of the date
of the enactment of this Act.
(c) The Administration shall report to the Small
Business Committee of the United States Senate and to
the Small Business Committee of the United States House
of Representatives within one year, and annually there-
after, on the implementation of this section, specifically
including data on the number of development companies
designated as premier lenders, their debenture guarantee
volume, and the loss rate for premier lenders as compared
to accredited and other lenders, along with such other in-
formation as the Administration deems appropriate.
(d) Section 508 of the Small Business Investment Act
of 1958 is repealed on October 1, 1999.
(e) The table of contents contained in section 101 of
the Small Business Investment Act of 1958 is amended
by adding at the end of the matter relating to title V the
following:
‘‘Sec. 507. Accredited lenders program.
‘‘Sec. 508. Premier lenders program.’’.
SEC. 211. SSBIC ADVISORY COUNCIL.
(a) COUNCIL ESTABLISHED.—Not later than 90 days
after the date of the enactment of this Act, the Adminis-
trator of the Small Business Administration shall appoint
an Investment Advisory Council for the Specialized Small
Business Investment Company Program. The Council
shall consist of not less than 12 individuals from the pri-
vate sector, including individuals—
(1) who have experience in providing venture
capital to small business, particularly minority small
business;
(2) who are current participants in the Special-
ized Small Business Investment Company Program;
(3) who are former participants in the Special-
ized Small Business Investment Company Program;
or
(4) who are or who represent small business
concerns.
(b) CHAIRMAN
AND
STAFF.—The Administrator
shall designate one of the members of the Council as chair-
person. The Investment Division of the Small Business
Administration shall provide such staff, technical support,
and information as shall be deemed appropriate. Council
members shall be deemed to be an advisory board pursu-
ant to section 8(b)(13) of the Small Business Act for pur-
poses of reimbursement of expenses.
(C) REPORT.—Within six months of the date of ap-
pointment, the Council shall make a written report with
findings and recommendations on the venture capital
needs, including debt and equity, of socially or economi-
cally disadvantaged small business concerns and any need-
ed Federal incentives to assist the private sector to meet
such needs. The report shall specifically address—
(1) the history of the Specialized Small Busi-
ness Investment Company program in providing as-
sistance to such concerns and the impact of such as-
sistance on the economy;
(2) the appropriateness and ability of the Spe-
cialized Small Business Investment Company Pro-
gram to meet these needs;
(3) the problems affecting the Specialized Small
Business Investment Company Program; and
(4) the effectiveness of the Specialized Small
Business Investment Company Program and its ad-
ministration by the Small Business Administration.
SEC. 212. 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 the fol-
lowing new paragraph at the end:
‘‘(13) Of the amount of the annual program
level of participating securities approved in Appro-
priations Acts, 50 percent shall be reserved for fund-
ing Small Business Investment Companies with pri-
vate capital of less than $20,000,000; except that
during the last quarter of each fiscal year, the Ad-
ministrator may, if he determines that there is a
lack of qualified applicants with private capital
under such amount, utilize all or any part of the se-
curities so reserved.’’.
SEC. 213. REPORT ON SBIC PROGRAM.
The Small Business Administration shall provide the
Committee on Small Business of the House of Representa-
tives and Senate with a comprehensive report on the sta-
tus and disposition of all Small Business Investment Com-
panies, active or in liquidation, and a complete accounting
of the assets in and the basis of their portfolios, the pro-
jected and actual loss rates for all portfolios in liquidation
or active, and a detailed accounting of valuation of the
SBIC program’s investments. This report shall be deliv-
ered to the respective Committees on Small Business no
later than April 15, 1995.
TITLE III—SIZE STANDARDS AND
BOND GUARANTEES
SEC. 301. COMPETITIVE DEMONSTRATION PROJECT SIZE
STANDARDS.
Section 732 of the Business Opportunity Develop-
ment Reform Act of 1988 (Public Law 100–656) is
amended by repealing the second sentence of such section.
SEC. 302. SIZE STANDARD CRITERIA.
Section 3(a)(2) of the Small Business Act (15 U.S.C.
632(a)(2)) is amended to read as follows:
‘‘(2) 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. Such standards may utilize number
of employees, dollar volume of business, net worth, net in-
come, or a combination thereof. Unless specifically author-
ized by statute, no Federal department or agency may pre-
scribe a size standard for categorizing a business concern
as a small business concern, unless such proposed size
standard—
‘‘(A) is being proposed after an opportunity for
public notice and comment;
‘‘(B) provides for determining—
‘‘(i) the size of a manufacturing concern as
measured by its average employment based
upon employment during each of the concern’s
pay periods for the preceding twelve calendar
months;
‘‘(ii) the size of a concern providing serv-
ices on the basis of the annual average gross re-
ceipts of the concern over a period of not less
than 3 years; and
‘‘(iii) the size of other concerns on the
basis of data over a period of not less than 3
years; and
‘‘(C) is approved by the Administrator if it is
not being proposed by the Small Business Adminis-
tration.’’.
SEC. 303. SUNSET ON PREFERRED SURETY BOND GUARAN-
TEE PROGRAM.
Section 207 of the Small Business Administration
Reauthorization and Amendment Act of 1988 (Public Law
100–590) is amended by striking ‘‘September 30, 1994’’
and by inserting in lieu thereof ‘‘September 30, 1997’’.
SEC. 304. VERY SMALL BUSINESS CONCERNS.
The Small Business Act (15 U.S.C. 631 et seq.) is
amended by redesignating section 30 as section 41 and
by inserting after section 29, as redesignated by section
606 of this Act, the following:
‘‘SEC. 30. PILOT PROGRAM FOR VERY SMALL BUSINESS
CONCERNS.
‘‘(a) ESTABLISHMENT.—The Administration shall es-
tablish and carry out a pilot program in accordance with
the requirements of this section to provide procurement
opportunities to very small business concerns.
‘‘(b) SUBCONTRACTING
OF
PROCUREMENT
CON-
TRACTS.—
‘‘(1) IN GENERAL.—In carrying out the pro-
gram, the Administration is authorized to enter into
procurement contracts with the United States Gov-
ernment and to arrange for the performance of such
contracts through the award of subcontracts to very
small business concerns.
‘‘(2) TERMS AND CONDITIONS.—The authority
of the Administration under paragraph (1) shall be
subject to the same terms and conditions as apply
to the authority of the Administration under section
8(a), except that—
‘‘(A) the Administration may make such
modifications to such terms and conditions as
the Administration determines necessary; and
‘‘(B) all contract opportunities offered for
award under the program shall be awarded on
the basis of competition restricted to eligible
program participants.
‘‘(c) PROGRAM PARTICIPATION.—Very small business
concerns participating in the program shall be subject to
the same terms and conditions for program participation
as apply to program participants under sections 7(j) and
8(a); except that—
‘‘(1) the Administration may make such modi-
fications to such terms and conditions as the Admin-
istration determines necessary; and
‘‘(2) eligibility shall be determined on the basis
of qualifying as a very small business concern as de-
fined in subsection (g), in lieu of the requirements
contained in paragraphs (4), (5), and (6) of section
8(a).
‘‘(d) TECHNICAL AND FINANCIAL ASSISTANCE.—In
order to assist very small business concerns participating
in the program, the Administration is authorized—
‘‘(1) to provide technical assistance to such con-
cerns in the same manner and to the same extent
as technical assistance is provided to small business
concerns pursuant to section 7(j); and
‘‘(2) to provide pre-authorization to such con-
cerns for the purpose of receiving financial assist-
ance under section 7(a).
‘‘(e) PROGRAM TERM.—The Administration shall
carry out the program in each of fiscal years 1995, 1996,
and 1997.
‘‘(f) REPORT TO CONGRESS.—On or before December
31, 1996, the Administration shall transmit to Congress
a report containing an analysis of the results of the pro-
gram, together with recommendations for appropriate leg-
islative and administrative actions.
‘‘(g) DEFINITIONS.—For the purposes of this section,
the following definitions apply:
‘‘(1) PROGRAM.—The term ‘program’ means
the program established pursuant to subsection (a).
‘‘(2) VERY
SMALL
BUSINESS
CONCERN.—The
term ‘very small business concern’ means a small
business concern that—
‘‘(A) has 10 employees or less; or
‘‘(B) has average annual receipts that total
$1,000,000 or less.’’.
TITLE IV—MANAGEMENT
ASSISTANCE
SEC. 401. SUNSET ON COSPONSORED TRAINING.
(a) The authority of the Small Business Administra-
tion to cosponsor training as authorized by section 5(a)
of the Small Business Computer Security and Education
Act of 1984 (15 U.S.C. 633 note) is hereby repealed Sep-
tember 30, 1997.
(b) Section 7(b) of the Small Business Computer Se-
curity and Education Act of 1984 (15 U.S.C. 633 note)
is amended by striking from the second sentence ‘‘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 by
inserting in lieu thereof ‘‘is’’.
SEC. 402. SMALL BUSINESS DEVELOPMENT CENTER PRO-
GRAM LEVEL.
Section 21(a)(4) of the Small Business Act (15
U.S.C. 648(a)(4)) is amended to read as follows:
‘‘(4) 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 pro-
vided from sources other than the Federal Government,
to be comprised of not less than 50 per centum cash and
not more than 50 per centum of indirect costs and in-
kind contributions: Provided, That this matching amount
shall not include any indirect costs or in-kind contribu-
tions derived from any Federal program: Provided further,
That no recipient of funds under this section shall receive
a grant which would exceed its pro rata share of a national
program based upon the population to be served by the
Small Business Development Center as compared to the
total population in the United States, plus $125,000, or
$200,000, whichever is greater, per year. The amount of
the national program shall be—
‘‘(A) $70,000,000 through September 30, 1995;
‘‘(B) $77,500,000 from October 1, 1995
through September 30, 1996; and
‘‘(C) $85,000,000 beginning October 1, 1996.
The amount of eligibility of each Small Business Develop-
ment Center shall be based upon the amount of the na-
tional program in effect as of the date for commencement
of performance of the Center’s grant.’’.
SEC. 403. FEDERAL CONTRACTS WITH SMALL BUSINESS DE-
VELOPMENT CENTERS.
(a) Section 21(a)(5) of the Small Business Act (15
U.S.C. 648(a)(5)) is amended to read as follows:
‘‘(5) A Small Business Development Center may
enter a contract with a Federal department or agency to
provide specific assistance to small business concerns if
the contract is approved in advance by the Deputy Associ-
ate Administrator of the Small Business Development
Center program. Approval shall be based upon a deter-
mination that the contract will provide assistance to small
business concerns and that its performance will not hinder
the Center in carrying out the terms of its grant from
the Administration. The amount of any such contract shall
not be subject to the matching funds requirements of
paragraph (4) nor shall the amount of eligibility under
such paragraph: Provided, That notwithstanding any
other provision of law, such contracts for assistance to
small business concerns shall not be counted toward any
Federal department or agency’s small business, women-
owned business, or socially and economically disadvan-
taged business contracting goal as established by section
15(g) of the Small Business Act (15 U.S.C. 644(g)).’’.
(b) Section 21(a)(6) of the Small Business Act (15
U.S.C. 648(a)(6)) is amended by striking ‘‘paragraphs (4)
and (5)’’ and by inserting in lieu thereof ‘‘paragraph (4)’’.
SEC. 404. CENTRAL EUROPEAN SMALL BUSINESS DEVELOP-
MENT.
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 by inserting in lieu
thereof ‘‘, $2,000,000 for each of fiscal years 1993 and
1994, and $1,000,000 for fiscal year 1995’’.
SEC. 405. 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 (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, informa-
tion, 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, not later
than December 31, 1996, he shall transmit to Congress
a report containing the results of such program, together
with recommendations for appropriate legislative and ad-
ministrative actions.
(d) AUTHORIZATION OF APPROPRIATIONS.—There is
authorized to be appropriated for fiscal year 1995
$900,000 to carry out this section. Of such sums—
(1) $800,000 may be made available for the
purchase or lease of mobile resource center vehicles;
and
(2) $100,000 may be made available for stud-
ies, startup expenses, and other administrative ex-
penses.
Such sums shall remain available until expended.
TITLE V—RELIEF FROM FFB DE-
BENTURE PREPAYMENT PEN-
ALTIES
SEC. 501. CITATION.
This title may be cited as the ‘‘Small Business Pre-
payment Penalty Relief Act of 1994.’’.
SEC. 502. MODIFICATION OF DEVELOPMENT COMPANY DE-
BENTURE INTEREST RATES.
(a) IN GENERAL.—Upon the request of the issuer
and the concurrence of the borrower, the Small Business
Administration is authorized to transfer to the Federal Fi-
nancing Bank such sums as may be necessary to carry
out the provisions of this section in order to reduce the
interest rate on a debenture issued by a certified develop-
ment company. The reduction shall be effective January
2, 1995 and shall apply for the remainder of the term
of the debenture.
(b) INTEREST RATE MODIFICATION.—Upon receipt
of such payment, the Federal Financing Bank shall mod-
ify the interest rate of each debenture for which the pay-
ment is made. No other change shall be made in the terms
and conditions of the debenture, and the modification in
the interest rate shall not be construed as new budget au-
thority nor require any additional appropriation for credit
subsidy on account of the modification.
(c) DEFINITIONS.—For the purposes of this sec-
tion—
(1) the term ‘‘issuer’’ means the issuer of a de-
benture pursuant to section 503 of the Small Busi-
ness Investment Act of 1958 which has been pur-
chased by the Federal Financing Bank if the deben-
ture is outstanding on the date of enactment of this
Act, and neither the loan that secures the debenture
nor the debenture is in default on such date; and
(2) the term ‘‘borrower’’ means the small busi-
ness concern whose loan secures a debenture issued
pursuant to such section.
(d) OTHER RIGHTS.—A modification of the interest
rate on a debenture as authorized in this section shall not
affect any rights or options of the issuer or borrower which
are otherwise authorized by contract or by law.
(e) REFINANCING.—Debentures authorized by sec-
tions 504 and 505 of the Small Business Investment Act
of 1958 may be used to refinance debentures issued under
section 503 of such Act if the amount of the new financing
is limited to such amounts as are needed to repay the ex-
isting debenture, including any prepayment penalty im-
posed by the Federal Financing Bank. Any such refinanc-
ing shall be subject to all of the other provisions of sec-
tions 504 and 505 of such Act and the rules and regula-
tions of the Administration promulgated thereunder, in-
cluding, but not limited to, rules and regulations govern-
ing payment of authorized expenses and commissions, fees
and discounts to brokers and dealers in trust certificates
issued pursuant to section 505: Provided, however, That
no applicant for refinancing under section 504 of this Act
need demonstrate that the requisite number of jobs will
be created or preserved with the proceeds of such refinanc-
ing: Provided further, That a development company which
provides refinancing under this subsection shall be limited
to a loan processing fee not to exceed one-half of one per-
cent to cover the cost of packaging, processing and other
nonlegal staff functions.
SEC. 503. MODIFICATION OF SMALL BUSINESS INVEST-
MENT 
COMPANY 
DEBENTURE 
INTEREST
RATES.
(a) IN GENERAL.—Upon the request of the issuer,
the Small Business Administration is authorized to trans-
fer to the Federal Financing Bank such sums as may be
necessary to carry out the provisions of this section in
order to reduce the interest rate on a debenture issued
by a Small Business Investment Company under the provi-
sions of title III of the Small Business Investment Act
of 1958. The reduction shall be effective January 2, 1995
and shall apply for the remainder of the term of the deben-
ture.
(b) INTEREST RATE MODIFICATION.—Upon receipt
of such payment, the Federal Financing Bank shall mod-
ify the interest rate of each debenture for which the pay-
ment is made. No other change shall be made in the terms
and conditions of the debenture, and the modification in
the interest rate shall not be construed as new budget au-
thority nor require any additional appropriation for credit
subsidy on account of the modification.
(c) DEFINITIONS.—For the purposes of this section,
the term ‘‘issuer’’ means the issuer of a debenture pursu-
ant to section 303 of the Small Business Investment Act
of 1958 which has been purchased by the Federal Financ-
ing Bank if the debenture is outstanding on the date of
enactment of this Act, and is not in default on such date.
(d) OTHER RIGHTS.—A modification of the interest
rate on a debenture as authorized in this section shall not
affect any rights or options of the issuer which are other-
wise authorized by contract or by law.
SEC. 504. MODIFICATION OF SPECIALIZED SMALL BUSI-
NESS INVESTMENT COMPANY DEBENTURE
INTEREST RATES.
(a) INTEREST RATE MODIFICATION.—Upon the re-
quest of the issuer, the Small Business Administration is
authorized to modify the interest rate on a debenture is-
sued by a Small Business Investment Company licensed
under the provisions of section 301(d) of the Small Busi-
ness Investment Act of 1958 and which is held by the Ad-
ministration. No debenture which has been sold to a third
party shall be eligible for modification under this section.
The reduction shall be effective January 2, 1995 and shall
apply for the remainder of the term of the debenture. No
other change shall be made in the terms and conditions
of the debenture, and the modification in the interest rate
shall not be construed as new budget authority nor require
any additional appropriation for credit subsidy on account
of the modification.
(b) DEFINITIONS.—For the purposes of this section,
the term ‘‘issuer’’ means a Specialized Small Business In-
vestment Company licensed under the provisions of section
301(d) of the Small Business Investment Act of 1958
which has issued a debenture which has been funded by
the Small Business Administration, providing the deben-
ture is outstanding on the date of enactment of this Act
and is not in default on such date.
(c) OTHER RIGHTS.—A modification of the interest
rate on a debenture as authorized in this section shall not
affect any rights or options of the issuer which are other-
wise authorized by contract or by law.
SEC. 505. INTEREST RATE REDUCTIONS.
(a) IN GENERAL.—Upon enactment of an Appropria-
tions Act providing funds to carry out the provisions of
this Act and limited to amounts specifically provided in
advance in Appropriations Acts, the Small Business Ad-
ministration shall evaluate the outstanding portfolio of de-
bentures which are eligible for interest rate relief under
this Act. The Administration shall apply the funds appro-
priated to carry out this Act in order to reduce the highest
interest rate on all eligible debentures to a uniform rate.
(b) AUTHORIZATION.—There are authorized to be ap-
propriated $30 million to carry out the provisions of this
Act in fiscal year 1995.
TITLE VI—DEVELOPMENT OF
WOMEN-OWNED BUSINESSES
SEC. 601. STATUS OF COUNCIL.
Section 401 of the Women’s Business Ownership Act
of 1988 (15 U.S.C. 631 note) is redesignated as section
405 of such Act and, as redesignated, is amended—
(1) in the heading by inserting ‘‘OF
THE
COUNCIL’’ after ‘‘ESTABLISHMENT’’; and
(2) by striking the period at the end and insert-
ing the following: ‘‘which shall serve as an independ-
ent advisory council to the Interagency Committee
on Women’s Business Enterprise, to the Adminis-
trator of the Small Business Administration, and to
the Congress of the United States. The Council, in
order to carry out its function as an independent ad-
visory council to the Congress, is authorized and di-
rected to report independently of the Interagency
Committee directly to the Congress at such times
and on such matters as it, in its discretion, deems
appropriate.’’.
SEC. 602. DUTIES OF NATIONAL WOMEN’S BUSINESS COUN-
CIL.
Section 402 of the Women’s Business Ownership Act
of 1988 (15 U.S.C. 631 note) is redesignated as section
406 of such Act and, as redesignated, is amended to read
as follows:
‘‘SEC. 406. DUTIES OF THE COUNCIL.
‘‘The Council shall meet at such times as it deter-
mines necessary in order to advise and consult with the
Interagency Committee on Women’s Business Enterprise
on matters relating to the activities, functions, and policies
of such Committee as provided in this title. The Council
shall make annual recommendations for consideration by
the Committee. The Council also shall provide reports and
make such other recommendations as it deems appropriate
to the Committee, to the Administrator of the Small Busi-
ness Administration, and to the Small Business Commit-
tee of the United States Senate and to the Small Business