Title: HUBZone Unification and Business Stability Act of 2017
Policy area: Commerce

Summary:
HUBZone Unification and Business Stability Act of 2017
This bill reauthorizes through FY2020 and revises the Historically Underutilized Business Zone (HUBZone) program, including by revising criteria for HUBZone area designations.

[Congressional Bills 115th Congress]
[From the U.S. Government Publishing Office]
[H.R. 3294 Introduced in House (IH)]

<DOC>






115th CONGRESS
  1st Session
                                H. R. 3294

To amend the Small Business Act to clarify the definitions relating to 
                   HUBZones, and for other purposes.


_______________________________________________________________________


                    IN THE HOUSE OF REPRESENTATIVES

                             July 19, 2017

  Ms. Velazquez (for herself and Mr. Chabot) introduced the following 
      bill; which was referred to the Committee on Small Business

_______________________________________________________________________

                                 A BILL


 
To amend the Small Business Act to clarify the definitions relating to 
                   HUBZones, and for other purposes.

    Be it enacted by the Senate and House of Representatives of the 
United States of America in Congress assembled,

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``HUBZone Unification and Business 
Stability Act of 2017''.

SEC. 2. TRANSFER OF HUBZONE DEFINITIONS.

    (a) Redesignation.--Section 31 of the Small Business Act (15 U.S.C. 
657a) is amended by redesignating subsections (b), (c), and (d) as 
subsections (c), (d), and (e), respectively.
    (b) Transfer.--Subsection (p) of section 3 of the Small Business 
Act (15 U.S.C. 632(p)) is transferred to section 31 of the Small 
Business Act (15 U.S.C. 657a), inserted so as to appear after 
subsection (a), and redesignated as subsection (b), and is amended--
            (1) by striking ``In this Act:'' and inserting ``In this 
        section:'';
            (2) in paragraph (1)--
                    (A) by striking ``term'' and inserting ``terms''; 
                and
                    (B) by striking ``means'' and inserting ``or 
                `HUBZone' mean''; and
            (3) by striking paragraph (2) (and redesignating subsequent 
        paragraphs accordingly).
    (c) Definition of Qualified HUBZone Small Business Concern.--
Section 3 of the Small Business Act (15 U.S.C. 632), as amended by 
subsection (a), is further amended by inserting after subsection (o) 
the following new subsection (p):
    ``(p) Qualified HUBZone Small Business Concern.--In this Act, the 
term `qualified HUBZone small business concern' has the meaning given 
such term in section 31(b).''.
    (d) Conforming Amendments.--
            (1) Mentor-protege program.--Section 831(n)(2)(G) of the 
        National Defense Authorization Act for Fiscal Year 1991 (Public 
        Law 101-510; 104 Stat. 1607; 10 U.S.C. 2302 note) is amended by 
        striking ``section 3(p) of the Small Business Act (15 U.S.C. 
        632(p))'' and inserting ``section 31(b) of the Small Business 
        Act (15 U.S.C. 657a(b))''.
            (2) Title 10.--Section 2323 of title 10, United States 
        Code, is amended by striking ``section 3(p) of the Small 
        Business Act'' each place it appears and inserting ``section 
        31(b) of the Small Business Act (15 U.S.C. 657a(b))''.
            (3) Small business act.--Section 8(d)(3)(G) of the Small 
        Business Act (15 U.S.C. 637(d)(3)(G)) is amended by striking 
        ``section 3(p) of the Small Business Act'' and inserting 
        ``section 31(b)''.
            (4) Comprehensive small business subcontracting plans.--
        Section 834 of the National Defense Authorization Act for 
        Fiscal Years 1990 and 1991 (15 U.S.C. 637 note) is amended by 
        striking ``section 3(p)(5) of such Act (15 U.S.C. 632(p)(5))'' 
        and inserting ``section 31(b) of such Act (15 U.S.C. 
        657a(b))''.
            (5) Contracts for collection services.--Section 3718 of 
        title 31, United States Code, is amended by striking ``section 
        3(p) of the Small Business Act'' each place it appears and 
        inserting ``section 31(b) of the Small Business Act''.
            (6) Title 41.--Title 41, United States Code, is amended--
                    (A) in section 1122, by striking ``section 3(p) of 
                the Small Business Act (15 U.S.C. 632(p))'' each place 
                it appears and inserting ``section 31(b) of the Small 
                Business Act (15 U.S.C. 657a(b))''; and
                    (B) in section 1713, by striking ``section 3(p) of 
                the Small Business Act (15 U.S.C. 632(p))'' and 
                inserting ``section 31(b) of the Small Business Act (15 
                U.S.C. 657a(b))''.
            (7) Title 49.--Title 49, United States Code, is amended--
                    (A) in section 47107, by striking ``section 3(p) of 
                the Small Business Act'' each place it appears and 
                inserting ``section 31(b) of the Small Business Act (15 
                U.S.C. 657a(b))''; and
                    (B) in section 47113(a)(3), by striking ``section 
                3(p) of the Small Business Act (15 U.S.C. 632(o))'' and 
                inserting ``section 31(b) of the Small Business Act (15 
                U.S.C. 657a(b))''.

SEC. 3. AMENDMENTS TO DEFINITIONS OF QUALIFIED CENSUS TRACT AND 
              QUALIFIED NONMETROPOLITAN COUNTY.

    (a) In General.--Paragraph (3) of section 31(b) of the Small 
Business Act (as transferred and redesignated by section 2 of this Act) 
is amended--
            (1) in subparagraph (A)--
                    (A) by amending clause (i) to read as follows:
                            ``(i) In general.--The term `qualified 
                        census tract' means a qualified census tract as 
                        defined in section 42(d)(5)(B)(ii) of the 
                        Internal Revenue Code of 1986 that is reflected 
                        in an online tool prepared by the Administrator 
                        described under subsection (d)(7).''; and
                    (B) in clause (ii) by inserting ``and that is 
                reflected in the online tool described under clause 
                (i)'' after ``such section''; and
            (2) in subparagraph (B)--
                    (A) by inserting ``and that is reflected in the 
                online tool described under subparagraph (A)(i)'' after 
                ``any county''; and
                    (B) in clause (ii)--
                            (i) in subclause (I), by striking 
                        ``nonmetropolitan''; and
                            (ii) by striking ``the most recent data 
                        available'' each place such term appears and 
                        inserting ``a 5-year average of the available 
                        data''.
    (b) Technical Amendments.--Paragraph (3)(B) of section 31(b) of the 
Small Business Act (as transferred and redesignated by section 2 of 
this Act), as amended by subsection (a), is further amended--
            (1) in clause (i), by striking ``section 42(d)(5)(C)(ii) of 
        the Internal Revenue Code of 1986'' and inserting ``section 
        42(d)(5)(B)(ii) of the Internal Revenue Code of 1986''; and
            (2) in clause (ii)(III), by striking ``section 
        42(d)(5)(C)(iii) of the Internal Revenue Code of 1986'' and 
        inserting ``section 42(d)(5)(B)(iii) of the Internal Revenue 
        Code of 1986''.

SEC. 4. AMENDMENTS TO DEFINITIONS OF BASE CLOSURE AREA AND QUALIFIED 
              DISASTER AREA.

    Paragraph (3) of section 31(b) of the Small Business Act (as 
transferred and redesignated by section 2 of this Act), as amended by 
section 3, is further amended--
            (1) by amending clause (ii) of subparagraph (D) to read as 
        follows:
                            ``(ii) Limitation.--With respect to a base 
                        closure area that is a census tract or 
                        nonmetropolitan county described in clause (i), 
                        such census tract or nonmetropolitan shall be 
                        treated as a HUBZone for a period beginning on 
                        the date the military installation undergoes 
                        final closure and ending on the date the base 
                        closure area ceases to be a qualified census 
                        tract under subparagraph (A) or a qualified 
                        nonmetropolitan county under subparagraph (B) 
                        in accordance with the online tool prepared by 
                        the Administrator described under subsection 
                        (d)(7).''; and
            (2) by amending subparagraph (E) to read as follows:
                    ``(E) Qualified disaster area.--
                            ``(i) In general.--Subject to clauses (ii) 
                        and (iii), the term `qualified disaster area' 
                        means any census tract or nonmetropolitan 
                        county located in a major disaster area or an 
                        area in which a catastrophic incident has 
                        occurred if such census tract or 
                        nonmetropolitan county ceased to be qualified 
                        under subparagraph (A) or (B), as applicable, 
                        during the period beginning 5 years before the 
                        date on which the President declared the major 
                        disaster or the catastrophic incident occurred.
                            ``(ii) Duration.--A census tract or 
                        nonmetropolitan county shall be considered to 
                        be a qualified disaster area only for the 
                        period of time ending on the date the area 
                        ceases to be a qualified census tract under 
                        subparagraph (A) or a qualified nonmetropolitan 
                        county under subparagraph (B), in accordance 
                        with the online tool prepared by the 
                        Administrator described under subsection (d)(7) 
                        and beginning--
                                    ``(I) in the case of a major 
                                disaster declared by the President, on 
                                the date the President declared the 
                                major disaster for the area in which 
                                the census tract or nonmetropolitan 
                                county, as applicable, is located; or
                                    ``(II) in the case of a 
                                catastrophic incident, on the date on 
                                which the catastrophic incident 
                                occurred in the area in which the 
                                census tract or nonmetropolitan county, 
                                as applicable, is located.
                            ``(iii) Extension.--With respect to a 
                        census tract or nonmetropolitan county that is 
                        a qualified disaster area because it is located 
                        in an area in which a catastrophic incident 
                        occurred, the Administrator may extend the 
                        period described in clause (ii) if the 
                        Administrator determines that the census tract 
                        or nonmetropolitan county has not fully 
                        recovered from the catastrophic incident.
                            ``(iv) Definitions.--In this subparagraph:
                                    ``(I) Major disaster area.--The 
                                term `major disaster area' means an 
                                area for which the President has 
                                declared a major disaster under section 
                                401 of the Robert T. Stafford Disaster 
                                Relief and Emergency Assistance Act (42 
                                U.S.C. 5170).
                                    ``(II) Other definitions.--The 
                                terms `census tract' and 
                                `nonmetropolitan county' have the 
                                meanings given such terms in 
                                subparagraph (D)(iii).''.

SEC. 5. AMENDMENT TO DEFINITION OF REDESIGNATED AREAS.

    Paragraph (3) of section 31(b) of the Small Business Act (as 
transferred and redesignated by section 2 of this Act), as amended by 
section 4, is further amended by amending subparagraph (C) to read as 
follows:
                    ``(C) Redesignated area.--The term `redesignated 
                area' means any census tract that ceases to be 
                qualified under subparagraph (A) and any 
                nonmetropolitan county that ceases to be qualified 
                under subparagraph (B) for a period of 3 years after 
                the date on which the census tract or nonmetropolitan 
                county ceased to be so qualified.''.

SEC. 6. REPEAL OF 5-YEAR LIMITATION ON HUBZONE STATUS OF BASE CLOSURE 
              AREAS.

    Section 152(a) of title I of division K of the Consolidated 
Appropriations Act, 2005 (15 U.S.C. 632 note) is amended by repealing 
paragraph (2).

SEC. 7. AMENDMENT TO DEFINITION OF QUALIFIED HUBZONE SMALL BUSINESS 
              CONCERN.

    Paragraph (4) of section 31(b) of the Small Business Act (as 
transferred and redesignated by section 2 of this Act) is amended to 
read as follows:
            ``(4) Qualified hubzone small business concern.--The term 
        `qualified HUBZone small business concern' means a HUBZone 
        small business concern that has been certified by the 
        Administrator in accordance with the procedures described in 
        this section.''.

SEC. 8. AMENDMENTS TO HUBZONE PROGRAM.

    (a) Clarifications to Eligibility for HUBZone Program.--Section 
31(d) of the Small Business Act, as redesignated by section 2, is 
amended to read as follows:
    ``(d) Eligibility Requirements; Enforcement.--
            ``(1) Certification.--In order to be certified by the 
        Administrator as a qualified HUBZone small business concern, a 
        HUBZone small business concern shall submit documentation the 
        Administrator stating that--
                    ``(A) at the time of certification and at each 
                examination conducted pursuant to paragraph (4), the 
                principal office of the concern is located in a HUBZone 
                and not fewer than 35 percent of its employees reside 
                in a HUBZone;
                    ``(B) the concern will attempt to maintain the 
                applicable employment percentage under subparagraph (A) 
                during the performance of any contract awarded to such 
                concern on the basis of a preference provided under 
                subsection (b); and
                    ``(C) the concern will ensure that the requirements 
                of section 46 are satisfied with respect to any 
                subcontract entered into by such concern pursuant to a 
                contract awarded under this section.
            ``(2) Verification.--In carrying out this section, the 
        Administrator shall establish procedures relating to--
                    ``(A) the filing, investigation, and disposition by 
                the Administration of any challenge to the eligibility 
                of a HUBZone small business concern to receive 
                assistance under this section (including a challenge, 
                filed by an interested party, relating to the veracity 
                of documentation provided to the Administration by such 
                a concern under paragraph (1)); and
                    ``(B) verification by the Administrator of the 
                accuracy of any documentation provided by a HUBZone 
                small business concern under paragraph (1).
            ``(3) Timing.--The Administrator shall complete the 
        verification procedures described in paragraph (2) in a 
        reasonable time, not later than 30 days after the date on which 
        the Administrator receives sufficient and complete 
        documentation from a HUBZone small business concern under 
        paragraph (1).
            ``(4) Examinations.--The Administrator shall conduct 
        program examinations of qualified HUBZone small business 
        concerns, using a risk-based analysis to select such concerns, 
        to ensure that each such concern meets the requirements of 
        paragraph (1).
            ``(5) Recertification.--The Administrator shall verify the 
        accuracy of any documentation provided by a HUBZone small 
        business concern under paragraph (1) to determine if such 
        HUBZone small business concern is a qualified HUBZone small 
        business concern 3 years after the date that such HUBZone small 
        business concern has been certified as a qualified HUBZone 
        small business concern, and every 3 years thereafter.
            ``(6) Loss of certification.--A HUBZone small business 
        concern that, based on the results of an examination conducted 
        pursuant to paragraph (4) no longer meets the requirements of 
        paragraph (1), shall have 30 days to submit documentation to 
        the Administrator to be eligible to be certified as a qualified 
        HUBZone small business concern. During the 30-day period, such 
        concern may not compete for or be awarded a contract under this 
        section. If such concern fails to meet the requirements of 
        paragraph (1) by the last day of the 30-day period, such 
        concern will not be certified as a qualified HUBZone small 
        business concern.
            ``(7) Hubzone online tool.--
                    ``(A) In general.--The Administrator shall develop 
                a publicly accessible online tool that depicts 
                HUBZones. Such online tool shall be updated--
                            ``(i) with respect to qualified areas 
                        described under subparagraphs (A) and (B) of 
                        subsection (b)(3), beginning on January 1, 
                        2020, and every 5 years thereafter;
                            ``(ii) with respect to qualified areas 
                        described under subsection (b)(3)(C), 
                        immediately after an area ceases to be a 
                        redesignated area; and
                            ``(iii) with respect to qualified areas 
                        described under subparagraphs (D) and (E) of 
                        subsection (b)(3), immediately after an area is 
                        designated as a base closure area or a 
                        qualified disaster area.
                    ``(B) Data.--The online tool required under 
                subparagraph (A) shall clearly and conspicuously 
                provide access to the data used by the Administrator to 
                determine whether or not an area is a qualified area in 
                the year in which the online tool was prepared.
                    ``(C) Notification of update.--The Administrator 
                shall include in the online tool a notification of the 
                date on which the online tool, and the data used to 
                create the online tool, will be updated.
            ``(8) List of qualified hubzone small business concerns.--
        The Administrator shall establish and maintain on the Internet 
        a list of qualified HUBZone small business concerns that 
        shall--
                    ``(A) to the extent practicable, include the name, 
                address, and type of business with respect to such 
                concern;
                    ``(B) be updated by the Administrator not less than 
                annually; and
                    ``(C) be provided upon request to any Federal 
                agency or other entity.
            ``(9) Provision of data.--Upon the request of the 
        Administrator, the Secretary of Labor, the Administrator of the 
        Federal Emergency Management Agency, the Secretary of Housing 
        and Urban Development, and the Secretary of the Interior (or 
        the Assistant Secretary for Indian Affairs), shall promptly 
        provide to the Administrator such information as the 
        Administrator determines to be necessary to carry out this 
        subsection.
            ``(10) Penalties.--In addition to the penalties described 
        in section 16(d), any small business concern that is determined 
        by the Administrator to have misrepresented the status of that 
        concern as a `qualified HUBZone small business concern' for 
        purposes of this section, shall be subject to liability for 
        fraud, including section 1001 of title 18, United States Code, 
        and sections 3729 through 3733 of title 31, United States 
        Code.''.
    (b) Performance Metrics.--Section 31 of the Small Business Act (15 
U.S.C. 657a) is amended--
            (1) in subsection (a), by inserting ``, including promoting 
        economic development in economically distressed areas (as 
        defined in section 7(m)(11)),'' after ``assistance'';
            (2) by redesignating subsection (e) (as redesignated by 
        section 2 of this Act) as subsection (f); and
            (3) by inserting after subsection (d) the following new 
        subsection:
    ``(e) Performance Metrics.--
            ``(1) In general.--Not later than 1 year after enactment of 
        this Act, the Administrator shall publish performance metrics 
        designed to measure the success of the HUBZone program 
        established under this section in meeting the program's 
        objective of promoting economic development in economically 
        distressed areas (as defined in section 7(m)(11)).
            ``(2) Collecting and managing hubzone data.--The 
        Administrator shall develop processes to incentivize regional 
        offices of the Administration to collect and manage data on 
        HUBZones within the geographic area served by such regional 
        office.
            ``(3) Report.--Not later than 90 days after the last date 
        of each fiscal year, the Administrator shall submit to the 
        Committee on Small Business and Entrepreneurship of the Senate 
        and the Committee on Small Business of the House of 
        Representatives a report--
                    ``(A) analyzing the data from the performance 
                metrics; and
                    ``(B) including the number of HUBZone small 
                business concerns that lost certification as a 
                qualified HUBZone small business concern because of the 
                results of an examination performed under subsection 
                (d)(6), and the number of those concerns that did not 
                submit documentation to be recertified under subsection 
                (d)(7).''.
    (c) Authorization of Appropriations.--Section 31(f) of the Small 
Business Act, as redesignated by subsection (b), is amended by striking 
``fiscal years 2004 through 2006'' and inserting ``fiscal years 2017 
through 2020''.

SEC. 9. CURRENT QUALIFIED HUBZONE SMALL BUSINESS CONCERNS.

    A HUBZone small business concern that was qualified pursuant to 
section 3(p)(5) of the Small Business Act on or before the date of the 
enactment of this Act shall continue to be considered as a qualified 
HUBZone small business concern during the period beginning on the date 
of the enactment of this Act and ending on the date that the 
Administrator of the Small Business Administration prepares the online 
tool depicting qualified areas described under section 31(d)(7) (as 
added by this Act).

SEC. 10. EFFECTIVE DATE.

    The provisions of this Act shall take effect--
            (1) with respect to section 9, on the date of the enactment 
        of this Act; and
            (2) with respect to sections 1 through 8, on January 1, 
        2020.
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