II 118th CONGRESS 1st Session S. 609 IN THE SENATE OF THE UNITED STATES March 1, 2023 Mr. Cardin introduced the following bill; which was read twice and referred to the Committee on Small Business and Entrepreneurship A BILL To establish a pilot program awarding competitive grants to organizations administering entrepreneurial development programming to formerly incarcerated individuals, and other purposes.

1. Short title This Act may be cited as the Necessary Entrepreneurship Workshops via the SBA to Transform and Assist Re-entry Training Act of 2023 or the NEW START Act of 2023 . 2. Findings Congress finds that— (1) according to the Department of Justice, every year, over 600,000 individuals are released from prison and return home to their communities, and almost 77 percent of those individuals will reoffend within 5 years; (2) according to the Brookings Institution, an estimated 48.5 percent of formerly incarcerated individuals will remain unemployed or earn a negligible income for a period of 1 year post-incarceration, increasing the risk for recidivism; (3) according to the Florida State University Institute for Justice Research and Development, formerly incarcerated individuals see a reduction in earnings of 25 percent since criminal records make it difficult to find stable employment; (4) self-employment can provide economic stability for those who are otherwise locked out of the labor market; and (5) according to a paper entitled Entrepreneurship as a Response to Labor Market Discrimination for Formerly Incarcerated People — (A) the average individual without a criminal record has a 7.09 percent likelihood of becoming an entrepreneur, but justice-impacted individuals were found to be more than 50 percent likely to choose entrepreneurship with a 12.69 percent likelihood of becoming an entrepreneur; (B) entrepreneurship reduces the likelihood of recidivism by 5.3 percent, which was a 32.5 percent decrease from average recidivism rates for regular employees who have been previously incarcerated; and (C) formerly incarcerated individuals who choose entrepreneurship make $2,700 more annually than formerly incarcerated employees and that the income gap between formerly incarcerated entrepreneurs and entrepreneurs with no criminal record was 38 percent lower than the income gap between formerly incarcerated employees and employees with no criminal record. 3. Pilot program (a) Definitions In this Act— (1) the terms Administration and Administrator mean the Small Business Administration and the Administrator thereof, respectively; (2) the term appropriate committees of Congress means— (A) the Committee on Small Business and Entrepreneurship of the Senate; and (B) the Committee on Small Business of the House of Representatives; (3) the term covered individual means an individual who— (A) completed a term of imprisonment in Federal, State, or local jail or prison; and (B) meets the offense eligibility requirements set forth in any applicable policy notice or other guidance issued by the Small Business Administration for the program established under section 7(m) of the Small Business Act ( 15 U.S.C. 636(m) ); (4) the terms intermediary and microloan have the meanings given those terms in section 7(m)(11) of the Small Business Act ( 15 U.S.C. 636(m)(11) ); (5) the term microloan intermediary means an intermediary that is eligible to participate in the program established under section 7(m) of the Small Business Act ( 15 U.S.C. 636(m) ); (6) the term pilot program means the pilot program established under subsection (b); and (7) the term small business development center has the meaning given the term in section 3 of the Small Business Act ( 15 U.S.C. 632 ). (b) Establishment Not later than 180 days after the date of enactment of this Act, the Administrator shall establish a pilot program to award grants to organizations over a 5-year period to create or support existing entrepreneurship development programs to provide assistance to covered individuals. (c) Grant requirements The Administrator shall— (1) award grants under the pilot program to organizations, or partnerships of organizations, which shall each receive a grant in an amount greater than $100,000 and less than $500,000 annually over the 5-year period in which the pilot program is in existence; and (2) allocate grants under the pilot program to ensure that the recipients are geographically varied throughout the United States. (d) Partnerships An applicant for a grant under the pilot program may form partnerships with other organizations for the purposes of the application submitted under subsection (e) and for conducting entrepreneurial development programming. (e) Application (1) In general An organization or partnership of organizations desiring a grant under the pilot program shall submit an application to the Administrator in such form, in such manner, and containing such information as the Administrator may reasonably require. (2) Contents An application submitted under paragraph (1) shall— (A) demonstrate that the applicant is a microloan intemediary or an organization that administers the Community Advantage Pilot Program of the Administration, or has a partnership with such an intermediary or organization, that may provide microloans to qualified covered individuals, or, to the extent that the applicant is a national organization in multiple different markets, that a separate microloan intermediary may be used in each such market; (B) demonstrate strong community ties, including those with the covered individual community, local businesses, and political leaders; (C) demonstrate an ability to provide a full range of entrepreneurial development programming on an ongoing basis; (D) include a plan for reaching covered individuals, including by identifying particular target populations within the community; (E) clearly define entrepreneurial development capabilities, including coordination with existing local resource partners of the Administration for additional training as necessary; (F) present an entrepreneurship development curriculum, which may be a nationally recognized model or based upon such a model; (G) include a list of each partner organization; and (H) include a comprehensive plan for the use of grant funds, including estimates for administrative and outreach costs of running and evaluating the entrepreneurship development program. (f) Priority In determining whether to award a grant under the pilot program, the Administrator may give priority to applicants based on— (1) whether the application includes a commitment from an existing or new non-Federal funding source to meet the matching requirement under subsection (g); (2) whether the application takes into account local economies and markets as a part of the educational component of the entrepreneurship development program; (3) the ability or plan of the applicant to provide entrepreneurial development services concurrent with employment or job training services; and (4) whether the applicant has a history of effectively providing entrepreneurial training or access to capital to covered individuals. (g) Matching requirement (1) In general As a condition of a grant provided under the pilot program, the Administrator shall require the recipient of the grant to contribute an amount equal to 25 percent of the amount of the grant, obtained solely from existing or new non-Federal sources. (2) Form In addition to cash or other direct funding, the contribution required under paragraph (1) may include indirect costs or in-kind contributions paid for under non-Federal programs. (h) Responsibilities A recipient of a grant under the pilot program shall, to the maximum extent possible, connect covered individuals to a range of Federal resources, including— (1) the program established under section 7(m) of the Small Business Act ( 15 U.S.C. 636(m) ); (2) the Community Advantage Pilot Program of the Administration; (3) small business development centers; (4) women’s business centers described in section 29 of the Small Business Act ( 15 U.S.C. 656 ); (5) chapters of the Service Corps of Retired Executives established under section 8(b)(1)(B) of the Small Business Act (( 15 U.S.C. 637(b)(1)(B) ); (6) Veteran Business Outreach Centers described in section 32 of the Small Business Act ( 15 U.S.C. 657b ); and (7) business centers established by the Minority Business Development Agency. (i) Reports (1) In general Not later than 1 year after the date on which the Administrator establishes the pilot program, and every year thereafter until the pilot program terminates, the Administrator shall submit to Congress a report on the activities of the pilot program, including— (A) a list of each grantee organization and each partner organization; (B) the characteristics of covered individuals assisted under the entrepreneurship development programs, including race and ethnicity, gender, age, marital status, parental status, employment status, income, banking and credit history, and prior business experience; (C) the participation and attendance rates for all components of the entrepreneurship development programs; (D) the program retention rate; (E) to the greatest extent practicable, the most common reasons why participants do not complete the program; (F) the percentage of participants who remain non-justice involved during the calendar year of the program; (G) the level of the covered individuals' understanding of business concepts and principles; (H) the level of the covered individuals' greater confidence in leadership strengths, including the results of an industry-recognized behavioral assessment; (I) the covered individuals' progress made toward establishing a business; (J) the experiences and perceptions of the covered individuals; (K) the number and dollar amount of loans made to covered individuals; (L) the number and dollar amount of loans made or guaranteed by the Administration to covered individuals; and (M) such additional information as the Administrator may require. (2) GAO report Not later than 1 year after the date on which the pilot program terminates, the Comptroller General of the United States shall submit to the appropriate committees of Congress a report that evaluates— (A) the services that grant recipients provided to covered individuals assisted under entrepreneurship development programs; (B) oversight of the pilot program by the Administrator, including policies and procedures for monitoring the compliance by grant recipients with pilot program requirements and an assessment of the effectiveness of the pilot program; and (C) the overall performance of the pilot program and the impacts of the pilot program on grant recipients. (j) Rule of construction Nothing in this Act may be construed to affect the program established under section 7(m) of the Small Business Act ( 15 U.S.C. 636(m) ), including— (1) the requirements of that program; (2) the manner in which that program is carried out; or (3) the use or availability of any amounts that have been made available to carry out that program. (k) Authorization of appropriations There are authorized to be appropriated to the Administrator such sums as are necessary to carry out the pilot program. (l) Termination The pilot program shall terminate on the date that is 5 years after the date on which the Administrator establishes the pilot program.