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SECTION 1. SHORT TITLE. 
This Act may be cited as the ‘‘Microenterprise Re-
sults and Accountability Act of 2004’’. 
SEC. 2. FINDINGS AND POLICY. 
Congress finds and declares the following: 
(1) Congress has demonstrated its support for 
microenterprise development assistance programs 
through the enactment of two comprehensive micro-
enterprise laws: 
(A) The Microenterprise for Self-Reliance 
Act of 2000 (title I of Public Law 106–309; 
114 Stat. 1082). 
(B) Public Law 108–31 (an Act entitled 
‘‘An Act to amend the Microenterprise for Self-
Reliance Act of 2000 and the Foreign Assist-
ance Act of 1961 to increase assistance for the 
poorest people in developing countries under 
microenterprise assistance program under those 
Acts, and for other purposes’’, approved June 
17, 2003). 
(2) The report on the effectiveness of the 
United States Agency for International Develop-
ment’s microfinance program, prepared by the Con-
sultative Group to Assist the Poor, rated the Agency 
in the top tier of the 17 donors in this field.
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(3) The Comptroller General, in a report dated 
November 2003, found that the United States Agen-
cy for International Development has met some, but 
not all, of the key objectives of such microenterprise 
development assistance programs. 
(4) The Comptroller General’s report found, 
among other things, the following: 
(A) Microenterprise development assistance 
generally can help alleviate some impacts of 
poverty, improve income levels and quality of 
life for borrowers and provide poor individuals, 
workers, and their families with an important 
coping mechanism. 
(B) Microenterprise development assist-
ance programs of the United States Agency for 
International Development have encouraged 
women’s participation in microfinance projects 
and, according to data of the Agency, women 
have comprised two-thirds or more of the micro-
loan clients in Agency-funded microenterprise 
projects since 1997. 
(5)(A) The Comptroller General’s report rec-
ommends that the Administrator of the United 
States Agency for International Development review 
the Agency’s ‘‘microenterprise results reporting’’
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system with the goal of ensuring that its annual re-
porting is complete and accurate. 
(B) Specifically, the Administrator should re-
view and reconsider the methodologies used for the 
collection, analysis, and reporting of data on annual 
spending targets, outreach to the very poor, sustain-
ability of microfinance institutions, and the contribu-
tion of Agency’s funding to the institutions it sup-
ports. 
SEC. 3. MICROENTERPRISE DEVELOPMENT ASSISTANCE. 
Chapter 2 of part I of the Foreign Assistance Act 
of 1961 (22 U.S.C. 2166 et seq.) is amended by inserting 
after title V the following new title: 
‘‘TITLE VI—MICROENTERPRISE DEVELOPMENT 
ASSISTANCE 
‘‘SEC. 251. FINDINGS AND POLICY. 
‘‘Congress finds and declares the following: 
‘‘(1) Access to financial services and the devel-
opment of microenterprise are vital factors in the 
stable growth of developing countries and in the de-
velopment of free, open, and equitable international 
economic systems. 
‘‘(2) It is therefore in the best interest of the 
United States to facilitate access to financial serv-
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ices and assist the development of microenterprise in 
developing countries. 
‘‘(3) Access to financial services and the devel-
opment of microenterprises can be supported by pro-
grams providing credit, savings, training, technical 
assistance, business development services, and other 
financial services. 
‘‘(4) Given the relatively high percentage of 
populations living in rural areas of developing coun-
tries, and the combined high incidence of poverty in 
rural areas and growing income inequality between 
rural and urban markets, microenterprise programs 
should target both rural and urban poor. 
‘‘(5) Microenterprise programs have been suc-
cessful and should continue to empower vulnerable 
women in the developing world. The Agency should 
work to ensure that recipients of microenterprise 
and microfinance development assistance under this 
title communicate and work with nongovernmental 
organizations and government organizations to iden-
tify and assist victims of trafficking as provided for 
in section 106(a)(1) of the Trafficking Victims Pro-
tection Act of 2000 (22 U.S.C. 7104(a)(1); Public 
Law 106–386) and women who are victims of or
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susceptible to other forms of exploitation and vio-
lence. 
‘‘(6) Given that microenterprise programs have 
been successful in empowering disenfranchised 
groups such as women, microenterprise programs 
should also target populations disenfranchised due to 
race or ethnicity in countries where a strong rela-
tionship between poverty and race or ethnicity has 
been demonstrated, such as countries in Latin 
America. 
‘‘SEC. 252. AUTHORIZATION; IMPLEMENTATION; TARGETED 
ASSISTANCE. 
‘‘(a) AUTHORIZATION.—The President is authorized 
to provide assistance on a non-reimbursable basis for pro-
grams in developing countries to increase the availability 
of credit, savings, and other services to microfinance and 
microenterprise clients lacking full access to capital, train-
ing, technical assistance, and business development serv-
ices, through—
‘‘(1) assistance for the purpose of expanding 
the availability of credit, savings, and other financial 
and non-financial services to microfinance and 
microenterprise clients; 
‘‘(2) assistance for the purpose of training, 
technical assistance, and business development serv-
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ices for microenterprises to enable them to make 
better use of credit, to better manage their enter-
prises, to conduct market analysis and product de-
velopment for expanding domestic and international 
sales, particularly to United States markets, and to 
increase their income and build their assets; 
‘‘(3) capacity-building for microfinance and 
microenterprise institutions in order to enable them 
to better meet the credit, savings, and training needs 
of microfinance and microenterprise clients; and 
‘‘(4) policy, regulatory programs, and research 
at the country level that improve the environment 
for microfinance and microenterprise clients and in-
stitutions that serve the poor and very poor. 
‘‘(b) IMPLEMENTATION.—
‘‘(1) OFFICE OF MICROENTERPRISE DEVELOP-
MENT.—There is established within the Agency an 
office of microenterprise development, which shall be 
headed by a Director who shall be appointed by the 
Administrator and who should possess technical ex-
pertise and ability to offer leadership in the field of 
microenterprise development. 
‘‘(2) ADDITIONAL PROVISIONS.—
‘‘(A) USE
OF
IMPLEMENTING
PARTNER 
ORGANIZATIONS.—Assistance under this section
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shall emphasize the use of implementing part-
ner organizations that best meet the require-
ments of subparagraph (C). 
‘‘(B) USE OF CENTRAL FUNDING MECHA-
NISMS.—
‘‘(i) PROGRAM.—In order to ensure 
that assistance under this title is distrib-
uted effectively and efficiently, the office 
shall also seek to implement a program of 
central funding under which assistance is 
administered directly by the office, includ-
ing through targeted core support for 
microfinance and microenterprise networks 
and other practitioners. 
‘‘(ii) FUNDING.—Of the amount made 
available to carry out this subtitle for a fis-
cal year, not less than $25,000,000 should 
be made available to carry out clause (i). 
‘‘(C) EFFICIENCY
AND
COST-EFFECTIVE-
NESS.—Assistance under this section shall meet 
high standards of efficiency, cost-effectiveness, 
and sustainability and shall especially provide 
the greatest possible resources to the poor and 
very poor. When administering assistance under 
this section, the Administrator shall—
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‘‘(c) TARGETED ASSISTANCE.—In carrying out sus-
tainable poverty-focused programs under subsection (a), 
50 percent of all microenterprise resources shall be tar-
geted to clients who are very poor. Specifically, until Sep-
tember 30, 2006, such resources shall be used for—
‘‘(1) support of programs under this section 
through practitioner institutions that—
‘‘(A) provide credit and other financial 
services to clients who are very poor, with loans 
in 1995 United States dollars of—
‘‘(i) $1,000 or less in the Europe and 
Eurasia region; 
‘‘(ii) $400 or less in the Latin Amer-
ica region; and 
‘‘(iii) $300 or less in the rest of the 
world; and 
‘‘(B) can cover their costs in a reasonable 
time period; or 
‘‘(2) demand-driven business development pro-
grams that achieve reasonable cost recovery that are 
provided to clients holding poverty loans (as defined 
by the regional poverty loan limitations in paragraph 
(1)(A)), whether they are provided by microfinance 
institutions or by specialized business development 
services providers.
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‘‘SEC. 253. MONITORING SYSTEM. 
‘‘(a) IN GENERAL.—In order to maximize the sus-
tainable development impact of assistance authorized 
under section 252(a), the Administrator of the Agency, 
acting through the Director of the office, shall strengthen 
its monitoring system to meet the requirements of sub-
section (b). 
‘‘(b) REQUIREMENTS.—The requirements referred to 
in subsection (a) are the following: 
‘‘(1) The monitoring system shall include per-
formance goals for the assistance and expresses such 
goals in an objective and quantifiable form, to the 
extent feasible. 
‘‘(2) The monitoring system shall include per-
formance indicators to be used in measuring or as-
sessing the achievement of the performance goals de-
scribed in paragraph (1) and the objectives of the 
assistance authorized under section 252. 
‘‘(3) The monitoring system provides a basis for 
recommendations for adjustments to the assistance 
to enhance the sustainability and the impact of the 
assistance, particularly the impact of such assistance 
on the very poor, particularly poor women. 
‘‘(4) The monitoring system adopts the wide-
spread use of proven and effective poverty assess-
ment tools to successfully identify the very poor and
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ensure that they receive adequate access to micro-
enterprise loans, savings, and assistance. 
‘‘SEC. 254. DEVELOPMENT AND CERTIFICATION OF POV-
ERTY MEASUREMENT METHODS; APPLICA-
TION OF METHODS. 
‘‘(a) DEVELOPMENT AND CERTIFICATION.—
‘‘(1) IN GENERAL.—The Administrator of the 
Agency, in consultation with microenterprise institu-
tions and other appropriate organizations, shall de-
velop no fewer than two low-cost methods for imple-
menting partner organizations to use to assess the 
poverty levels of their current incoming or prospec-
tive clients. The Administrator shall develop poverty 
indicators that correlate with the circumstances of 
the very poor. 
‘‘(2) FIELD TESTING.—The Administrator shall 
field-test the methods developed under paragraph 
(1). As part of the testing, institutions and pro-
grams may use the methods on a voluntary basis to 
demonstrate their ability to reach the very poor. 
‘‘(3) CERTIFICATION.—Not later than April 1, 
2005, the Administrator shall, from among the low-
cost poverty measurement methods developed under 
paragraph (1), certify no fewer than two such meth-
ods as approved methods for measuring the poverty
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levels of current, incoming, or prospective clients of 
microenterprise institutions for purposes of assist-
ance under section 252. 
‘‘(b) APPLICATION.—The Administrator shall require 
that, with reasonable exceptions, all implementing partner 
organizations applying for microenterprise assistance 
under this title use one of the certified methods, beginning 
not later than October 1, 2006, to determine and report 
the poverty levels of current, incoming, or prospective cli-
ents. 
‘‘SEC. 255. ADDITIONAL AUTHORITIES. 
‘‘Notwithstanding any other provision of law, 
amounts made available for assistance for microenterprise 
development assistance under any provision of law other 
than this title may be provided to further the purposes 
of this title. To the extent assistance described in the pre-
ceding sentence is provided in accordance with such sen-
tence, the Administrator of the Agency shall include, as 
part of the report required under section 258, a detailed 
description of such assistance and, to the extent applica-
ble, the information required by paragraphs (1) through 
(11) of subsection (b) of such section with respect to such 
assistance.’’.
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SEC. 4. MICROENTERPRISE DEVELOPMENT CREDITS. 
(a) TRANSFER.—Section 108 of the Foreign Assist-
ance Act of 1961 (22 U.S.C. 2151f) is hereby—
(1) transferred from chapter 1 of part I of the 
Foreign Assistance Act of 1961 to title VI of chap-
ter 2 of part I of such Act (as added by section 3 
of this Act); and 
(2) inserted after section 255 of the Foreign 
Assistance Act of 1961. 
(b) REDESIGNATION.—Title VI of chapter 2 of part 
I of the Foreign Assistance Act of 1961 is amended by 
redesignating section 108 (as added by subsection (a)) as 
section 256. 
(c) CONFORMING AMENDMENTS.—Title VI of chap-
ter 2 of part I of the Foreign Assistance Act of 1961 is 
amended—
(1) by inserting after the title heading the fol-
lowing: 
‘‘Subtitle A—Grant Assistance’’; 
(2) by inserting after section 255 the following: 
‘‘Subtitle B—Credit Assistance’’; and 
(3) in section 256 (as redesignated by sub-
section (b))—
(A) in the matter preceding paragraph (1) 
of subsection (c), by striking ‘‘Administrator of 
the agency primarily responsible for admin-
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istering this part’’ and inserting ‘‘Administrator 
of the Agency’’; and 
(B) in subsection (f)(1)—
(i) by striking ‘‘section 131’’ and in-
serting ‘‘this part’’; and 
(ii) by striking ‘‘$1,500,000 for each 
of fiscal years 2001 through 2004’’ and in-
serting ‘‘such sums as may be necessary 
for each of the fiscal years 2005 through 
2009’’. 
SEC. 5. UNITED STATES MICROFINANCE LOAN FACILITY. 
(a) TRANSFER.—Section 132 of the Foreign Assist-
ance Act of 1961 (22 U.S.C. 2152b) is hereby—
(1) transferred from chapter 1 of part I of the 
Foreign Assistance Act of 1961 to title VI of chap-
ter 2 of part I of such Act (as added by section 3 
of this Act); and 
(2) inserted after section 256 of the Foreign 
Assistance Act of 1961 (as added by section 4 of 
this Act). 
(b) REDESIGNATION.—Title VI of chapter 2 of part 
I of the Foreign Assistance Act of 1961 is amended by 
redesignating section 132 (as added by subsection (a)) as 
section 257.
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(c) CONFORMING AMENDMENTS.—Title VI of chap-
ter 2 of part I of the Foreign Assistance Act of 1961 is 
amended—
(1) by inserting after section 256 the following: 
‘‘Subtitle C—United States Microfinance Loan Facility’’; 
and 
(2) in section 257 (as redesignated by sub-
section (b))—
(A) in subsection (b)(3), by striking ‘‘2001 
and 2002’’ and inserting ‘‘2005 through 2009’’; 
(B) in the matter preceding subparagraph 
(A) of subsection (d)(1), by striking ‘‘this part 
for the fiscal year 2001, up to $5,000,000’’ and 
inserting ‘‘this part for each of the fiscal years 
2005 through 2009, such sums as may be nec-
essary’’; and 
(C) by striking subsection (e). 
SEC. 6. MISCELLANEOUS PROVISIONS. 
Title VI of chapter 2 of part I of the Foreign Assist-
ance Act of 1961 (as added by section 3 of this Act and 
amended by sections 4 and 5 of this Act) is further 
amended by adding at the end the following new subtitle:
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‘‘Subtitle D—Miscellaneous Provisions 
‘‘SEC. 258. REPORT. 
‘‘(a) IN GENERAL.—Not later than June 30, 2006, 
and each June 30 thereafter, the Administrator of the 
Agency, acting through the Director of the office, shall 
submit to the appropriate congressional committees a re-
port that contains a detailed description of the implemen-
tation of this title for the previous fiscal year. 
‘‘(b) CONTENTS.—The report shall contain the fol-
lowing: 
‘‘(1) The number of grants, cooperative agree-
ments, contracts, contributions, or other form of as-
sistance provided under section 252, with a listing 
of—
‘‘(A) the amount of each grant, cooperative 
agreement, contract, contribution, or other form 
of assistance; 
‘‘(B) the name of each recipient and each 
developing country with respect to which 
projects or activities under the grant, coopera-
tive agreement, contract, contribution, or other 
form of assistance were carried out; and 
‘‘(C) a listing of the number of countries 
receiving assistance authorized by section 252.
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‘‘(2) The results of the monitoring system re-
quired under section 253. 
‘‘(3) The process of developing and applying 
poverty assessment procedures required under sec-
tion 254. 
‘‘(4) The percentage of assistance furnished 
under section 252 that was allocated to the very 
poor based on the data collected using the certified 
methods required by section 254. 
‘‘(5) The estimated number of the very poor 
reached with assistance provided under section 252. 
‘‘(6) The amount of assistance provided under 
section 252 through central mechanisms. 
‘‘(7) The name of each country that receives as-
sistance under section 256 and the amount of such 
assistance. 
‘‘(8) Information on the efforts of the Agency 
to ensure that recipients of United States micro-
enterprise and microfinance development assistance 
work closely with nongovernmental organizations 
and foreign governments to identify and assist vic-
tims or potential victims of severe forms of traf-
ficking in persons and women who are victims of or 
susceptible to other forms of exploitation and vio-
lence.
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‘‘(9) Any additional information relating to the 
provision of assistance authorized by this title, in-
cluding the use of the poverty measurement tools re-
quired by section 254, or additional information on 
assistance provided by the United States to support 
microenterprise development under this title or any 
other provision of law. 
‘‘(10) An estimate of the percentage of bene-
ficiaries of assistance under this title in countries 
where a strong relationship between poverty and 
race or ethnicity has been demonstrated. 
‘‘(11) The level of funding provided through 
contracts, the level of funding provided through 
grants, contracts, and cooperative agreements that is 
estimated to be subgranted or subcontracted, as the 
case may be, to direct service providers, and an 
analysis of the comparative cost-effectiveness and 
sustainability of projects carried out under these 
mechanisms. 
‘‘(c) AVAILABILITY TO PUBLIC.—The report required 
by this section shall be made available to the public on 
the Internet website of the Agency. 
‘‘SEC. 259. DEFINITIONS. 
‘‘In this title:
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‘‘(1) ADMINISTRATOR.—The term ‘Adminis-
trator’ means the Administrator of the Agency. 
‘‘(2) AGENCY.—The term ‘Agency’ means the 
United States Agency for International Develop-
ment. 
‘‘(3) APPROPRIATE
CONGRESSIONAL
COMMIT-
TEES.—The term ‘appropriate congressional com-
mittees’ means the Committee on International Re-
lations of the House of Representatives and the 
Committee on Foreign Relations of the Senate. 
‘‘(4) BUSINESS DEVELOPMENT SERVICES.—The 
term ‘business development services’ means support 
for the growth of microenterprises through training, 
technical assistance, marketing assistance, improved 
production technologies, and other related services. 
‘‘(5) DIRECTOR.—The term ‘Director’ means 
the Director of the office. 
‘‘(6) 
IMPLEMENTING
PARTNER
ORGANIZA-
TION.—The term ‘implementing partner organiza-
tion’ means an entity eligible to receive assistance 
under this title which is—
‘‘(A) a United States or an indigenous pri-
vate voluntary organization; 
‘‘(B) a United States or an indigenous 
credit union;
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‘‘(C) a United States or an indigenous co-
operative organization; 
‘‘(D) an indigenous governmental or non-
governmental organization; 
‘‘(E) a microenterprise institution; 
‘‘(F) a microfinance institution; or 
‘‘(G) a practitioner institution. 
‘‘(7) MICROENTERPRISE
INSTITUTION.—The 
term ‘microenterprise institution’ means a not-for-
profit entity that provides services, including micro-
finance, training, or business development services, 
for microenterprise clients in foreign countries. 
‘‘(8) MICROFINANCE INSTITUTION.—The term 
‘microfinance institution’ means a not-for-profit enti-
ty or a regulated financial intermediary that directly 
provides, or works to expand, the availability of 
credit, savings, and other financial services to micro-
finance and microenterprise clients in foreign coun-
tries. 
‘‘(9) MICROFINANCE
NETWORK.—The term 
‘microfinance network’ means an affiliated group of 
practitioner institutions that provides services to its 
members, including financing, technical assistance, 
and accreditation, for the purpose of promoting the
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financial sustainability and societal impact of micro-
enterprise assistance. 
‘‘(10) OFFICE.—The term ‘office’ means the of-
fice of microenterprise development established 
under section 252(b)(1). 
‘‘(11) PRACTITIONER INSTITUTION.—The term 
‘practitioner institution’ means a not-for-profit enti-
ty or a regulated financial intermediary, including a 
microfinance network, that provides services, includ-
ing microfinance, training, or business development 
services, for microfinance and microenterprise cli-
ents, or provides assistance to microenterprise insti-
tutions in foreign countries. 
‘‘(12) PRIVATE VOLUNTARY ORGANIZATION.—
The term ‘private voluntary organization’ means a 
not-for-profit entity that—
‘‘(A) engages in and supports activities of 
an economic or social development or humani-
tarian nature for citizens in foreign countries; 
and 
‘‘(B) is incorporated as such under the 
laws of the United States, including any of its 
states, territories or the District of Columbia, 
or of a foreign country.
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‘‘(13) 
UNITED
STATES-SUPPORTED
MICRO-
FINANCE INSTITUTION.—The term ‘United States-
supported microfinance institution’ means a finan-
cial intermediary that has received funds made avail-
able under this part for fiscal year 1980 or any sub-
sequent fiscal year. 
‘‘(14) VERY
POOR.—The term ‘very poor’ 
means those individuals—
‘‘(A) living in the bottom 50 percent below 
the poverty line established by the national gov-
ernment of the country in which those individ-
uals live; or 
‘‘(B) living on less than the equivalent of 
$1 per day (as calculated using the purchasing 
power parity (PPP) exchange rate method).’’. 
SEC. 7. SENSE OF CONGRESS. 
It is the sense of Congress that, in carrying out title 
VI of chapter 2 of part I of the Foreign Assistance Act 
of 1961 (as added by section 3 of this Act and amended 
by sections 4 through 6 of this Act), the Administrator 
of the United States Agency for International Develop-
ment—
(1) where applicable, should ensure that micro-
enterprise development assistance provided under 
such title is matched by recipients with an equal
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amount of assistance from non-United States Gov-
ernment sources, including private donations, multi-
lateral funding, commercial and concessional bor-
rowing, savings, and program income; 
(2) should include in the report required by sec-
tion 258 of the Foreign Assistance Act of 1961 (as 
added by section 6 of this Act) a description of all 
matching assistance (as described in paragraph (1)) 
provided for the prior year by recipients of micro-
enterprise development assistance under such title; 
(3) should ensure that recipients of microenter-
prise development assistance under such title do not 
expend an unreasonably large percentage of such as-
sistance on administrative costs; 
(4) should not use recipients of microenterprise 
development assistance under such title to carry out 
critical management functions of the Agency, includ-
ing functions such as strategy development or overall 
management of programs in a country; and 
(5) should consult with the appropriate congres-
sional committees with respect to the implementa-
tion of title VI of chapter 2 of part I of the Foreign 
Assistance Act of 1961 not later than 90 days after 
the date of the enactment of this Act.
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SEC. 8. REPEALS. 
(a) FOREIGN ASSISTANCE ACT OF 1961.—Section 
131 of the Foreign Assistance Act of 1961 (22 U.S.C. 
2152a) is hereby repealed. 
(b) PUBLIC LAW 108–31.—
(1) IN
GENERAL.—Section 4 of Public Law 
108–31 (22 U.S.C. 2151f note) is amended by strik-
ing subsection (b). 
(2) CONFORMING AMENDMENT.—Section 4 of 
Public Law 108–31 is amended by striking ‘‘(a)’’ 
and all that follows through ‘‘Not later’’ and insert-
ing ‘‘Not later’’. 
SEC. 9. REFERENCES. 
Any reference in a law, regulation, agreement, or 
other document of the United States to section 108, 131, 
or 132 of the Foreign Assistance Act of 1961 shall be 
deemed to be a reference to subtitle B of title VI of chap-
ter 2 of part I of the Foreign Assistance Act of 1961, 
subtitle A of title VI of chapter 2 of part I of such Act,
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or subtitle C of title VI of chapter 2 of part I of such 
Act, respectively.
Passed the House of Representatives November 20, 
2004. 
Attest: 
JEFF TRANDAHL, 
Clerk.