An Act to amend the authorizing legislation of the Small Business Administration, and for other purposes.
PL 90-104 (S.1862), enacted 10/11/1967

268 
PUBLIC LAW 90-104-OCT. 11, 1967 
[81 STAT. 
79 Stat. 569. 
42 u s e 3201-
3203. 
SEC. 204. The Public Works and Economic Development Act of 
1965 is amended by adding at the end of title VI tliereof the following 
new section: 
ADMINISTRATION, OPERATION, AND MAINTENANCE 
"SEC. 604. No Federal assistance shall be approved under this Act 
unless the Secretary is satisfied that the project for which Federal 
assistance is granted will be properly and efficiently administered, 
operated, and maintained." 
Approved October 11, 1967. 
October 11, 1967 
[S. 1862] 
Small Business 
Act Amendments 
of 1967. 
Revolving funds. 
80 Stat. 132. 
15 u s e 633. 
Construction 
loans. 
72 Stat. 388. 
15 u s e 636. 
Disaster loans. 
80 Stat. 1319. 
Volunteer man-
agement coun-
selors. 
Travel expenses' 
etc. 
80 Stat. 1295. 
15 u s e 637. 
80 Stat. 499. 
Public Law 90-104 
AN ACT 
To amend the authorizing legislation of the Small Business Administration, and 
for other purposes. 
Be it enacted hy the Senate and House of Representatives 
of the 
United States of America in Congress assembled, 
, 
T I T L E I 
. .nv' -,:..^,>r-: 
- i, .r^ 
SEC. 101. This title may be cited as the "Small Business Act Amend-
ments of 1967". 
SEC. 102. Paragraph (4) of section 4(c) of the Small Business Act is 
amended— 
(1) by striking out "$1,400,000,000" and inserting in lieu there-
of "$1,900,000,000"; 
(2) by striking out "$400,000,000" and inserting in lieu thereof 
"$450,000,000"; 
(3) by striking out "$200,000,000" and inserting in lieu thereof 
"$300,000,000"; and 
(4) by striking out "$100,000,000" and inserting in lieu thereof 
"$200,000,000". 
SEC. 103. Paragraph (4) of section 7(a) is amended by striking out 
"except that a loan made for the purpose of constructing facilities may 
have a maturity of ten years" and inserting in lieu thereof "except that 
such portion of a loan made for the purpose of constructing facilities 
may have a maturity of fifteen years". 
SEC. 104. The subsection added to section 7 of the Small Business 
Act by the Disaster Eelief Act of 1966 (Public Law 89-769), and des-
ignated thereby as subsection (e), is redesignated as subsection (f). 
SEC. 105. Subparagraph (B) of paragraph (1) of section 8(b) of 
the Small Business Act is amended to read as follows: 
"(B) in the case of any individual or group of persons co-
operating with it in furtherance of the purposes of subparagraph 
(A), (i) to allow such an individual or group such use of the 
Administration's office facilities and related materials and services 
: J as the Administration deems appropriate; and (ii) to pay the 
transportation expenses and a per diem allowance in accordance 
w^ith section 5703 of title 5, United States Code, to any such in-
dividual for travel and subsistence expenses incurred at the request 
of the Administration in connection with travel to a point more 
than fifty miles distant from the home of that individual in pro-
„ 
viding gratuitous services to small businessmen in furtherance 
of the purposes of subparagraph (A) or in connection with at-
tendance at meetings sponsored by the Administration;". 
81 STAT.] 
PUBLIC LAW 90-104-OCT. 11, 1967 
269 
SEC. 106. Paragraph (13) of section 8(b) of the Small Business Act 
is amended to read as follows: 
"(13) to establish such advisory boards and committees as may 
be necessary to achieve the purposes of this Act and of the Small 
Business Investment Act of 1958; to call meetings of such boards 
and committees from time to time; to pay the transportation ex-
penses and a per diem allowance in accordance wdth section 5703 
of title 5, United States Code, to the members of such boards and 
committees for travel and subsistence expenses incurred at the 
request of the Administration in connection with travel to points 
more than fifty miles distant from the homes of such members in 
attending the meetings of such boards and committees; and to rent 
temporarily, within the District of Columbia or elsewhere, such 
hotel or other accommodations as are needed to facilitate the 
conduct of such meetings; and". 
SEC. 107. Section 8 (b) of the Small Business Act is amended— 
(1) by striking out "and" at the end of paragraph (13) ; 
(2) by striking out the period at the end of paragraph (14), by 
inserting "; and" in lieu thereof, and by adding the following new 
paragraph: 
" (15) to disseminate, without regard to the provisions of section 
4154 of title 39, United States Code, data and information, in such 
form as it shall deem appropriate, to public agencies, private or-
ganizations, and the general public." 
SEC. 108. The subsection added to section 402 of the Economic Op-
portunity Act of 1964 by section 405 of the Economic Opportunity 
Amendments of 1966 (Public Law 89-794), and designated thereby as 
subsection (b), is redesignated as subsection (c). 
TITLE I I 
SEC. 201. This title may be cited as the "Small Business Investment 
Act Amendments of 1967". 
SEC. 202. Section 301(c) of the Small Business Investment Act of 
1958 is amended to read as follows: 
"(c) The articles of incorporation and amendments thereto shall be 
forwarded to the Administration for consideration and approval or 
disapproval. In determining whether to approve such a company's 
articles of incorporation and permit it to operate under the provisions 
of this Act, the Administration shall give due regard, among other 
things, to the need and availability for the financing of small business 
concerns in the geographic area in which the proposed company is to 
commence business, the general business reputation and character of 
the proposed owners and management of the company, and the prob-
ability of successful operations of such company including adequate 
profitability and financial soundness. After consideration of all rele-
vant factors, if it approves the company's articles of incorporation, the 
Administration may in its discretion approve the company to operate 
under the provisions of this Act and issue the company a license for 
such operation." 
SEC. 203. (a) Section 302(a) of the Small Business Investment Act 
of 1958 is amended to read as follows: 
"SEC. 302. (a) Each company authorized to operate under this Act 
shall have a combined private paid-in capital and paid-in surplus in 
an amount (1) not less than $150,000, and (2) adequate to assure a 
reasonable prospect that the company will be operated soundly and 
profitably, and managed actively and prudently in accordance with its 
articles of incorporation." 
(b) The heading of section 302 of such Act is amended to read as 
follows: "CAPITAL REQUIREMENTS". 
Advisory boards. 
72 Stat. 391. 
15 u s e 637. 
72 Stat. 689. 
15 u s e 661 note. 
80 Stat. 499. 
,L.-''f 
Information, 
dissemination. 
74 Stat. 661. 
80 Stat. 1465. 
42 u s e 2902. 
Small Business 
Investment Act 
Amendments of 
1967. 
Articles of 
incorporation. 
Criteria for 
approval. 
72 Stat. 691. 
15 u s e 681. 
Capital and 
surplus, mini-
mum require-
ments. 
15 u s e 682. 
270 
PUBLIC LAW 90-104-OCT. 11, 1967 
[81 STAT. 
Bank (ownership 
of stock. 
72 Stat. 692; 
75 Stat. 752. 
Purchase of 
debentures. 
78 Stat. 146. 
15 use 683. 
Term; interest 
rate. 
Restrictions. 
(c) The description of section 302 in the table of contents of such 
Act is amended to read as follows: 
"Sec. 302. Capital requirements." 
SEC. 204. Section 302(b) of the Small Business Investment Act of 
1958 is amended by striking "except that in no event shall any such 
bank hold shares in small business investment companies in an amount 
aggregating more than 2 percent of its capital and surplus." and in-
serting "except that in no event may any such bank acquire shares in 
any small business investment company if, upon the making of that 
acquisition, 
"(1) the aggregate amount of shares in small business invest-
ment companies then held by the bank would exceed 5 percent 
of its capital and surplus, or 
"(2) the bank would hold 50 percent or more of any class of 
equity securities issued by that investment company and having 
actual or potential voting rights." 
SEC. 205. Section 303(b) of the Small Business Investment Act of 
1958 is amended to read as follows: 
"(b) To encourage the formation and growth of small business in-
vestment companies the Administration is authorized (but only to 
the extent that the necessary funds are not available to the company in-
volved from private sources on reasonable terms) to purchase, either 
directly or in cooperation with banks or other lending institutions 
through agreements to participate on; an immediate basis, the deben-
tures of any such company. Debentures purchased by the Administra-
tion under this subsection shall be subordinate to any other debenture 
bonds, promissory notes, or other debts and obligations of such com-
panies, unless the Administration in its exercise of reasonable invest-
ment prudence and in considering the financial soundness of such com-
pany determines otherwise. Such debentures may be issued for a term 
of not to exceed fifteen years and shall bear interest at a rate not less 
than a rate determined by the Secretary of the Treasury taking into 
consideration the current average market yield on outstanding market-
able obligations of the United States with remaining periods to matu-
rity comparable to the average maturities on such debentures, adjusted 
to the nearest one-eighth of 1 per centum, plus such additional charge, 
if any, toward covering other costs of the program as the Administra-
tion may determine to be consistent with its purposes. The debentures 
shall also contain such other terms as the Administration may fix, and 
shall be subject to the following restrictions and limitations: 
" (1) The total amount of debentures purchased and outstanding 
at any one time from a company which does not qualify under the 
terms of paragraph (2) of this subsection, shall not exceed 200 per-
cent of the combined paid-in capital and paid-in surplus of such 
company. In no event shall the debentures of any such company 
purchased 
and 
outstanding 
under 
this 
paragraph 
exceed 
$7,500,000. 
"(2) The total amount of debentures which may be purchased 
and outstanding at any one time from a company which (A) has 
a combined paid-in capital and paid-in surplus of $1,000,000 or 
more and (B) has investments or legally binding commitments of 
65 percent or more of its total funds available for investment in 
small business concerns invested or committed in venture capital, 
shall not exceed $2,000,000 plus 300 percent of that portion of the 
company's paid-in capital and paid-in surplus which exceeds 
$1,000,000. In no event shall the debentures of any such company 
purchased and outstanding under this paragraph exceed $10,-
000,000. Such additional purchases which the Administration 
-'> makes under this paragraph shall contain conditions to insure 
81 STAT.] 
PUBLIC LAW 90-104-OCT. 11, 1967 
271 
appropriate maintenance by the company receiving such assist-
ance of the described ratio during the period in which debentures 
under this paragraph are outstanding. 
"(3) Outstanding amounts of financial assistance provided to a 
company by the Administration prior to the effective date of the 
Small Business Investment Act Amendments of 1967 shall be 
deducted from the maximum amount of debentures which the Ad-
ministration would otherwise be authorized to purchase under 
this subsection. 
For purposes of this subsection, the term 'venture capital' includes 
such common stock, preferred stock, or other financing with subordi-
nation or nonamortization characteristics as the Administration deter-
mines to be substantially similar to equity financing." 
SEC. 206. Section 304(c) of the Small Business Investment Act of 
1958 is repealed. 
SEC. 207. Section 306 of the Small Business Investment Act of 1958 
is amended to read as follows: 
"SEC. 306. (a) Without the approval of the Administration, the 
aggregate amount of obligations and securities acquired and for which 
commitments may be issued by any small business investment company 
under the provisions of this Act for any single enterprise shall not 
exceed 20 percent of the combined paid-in capital and paid-in surplus 
of such company. 
"(b) For the purpose of this section, the combined paid-in capital 
and paid-in surplus of any company licensed prior to January 1,1968, 
shall consist of (1) the paid-in capital and paid-in surplus of such com-
pany and (2) the following portions of the funds outstanding from the 
Administration through the issuance of subordinated debentures as of 
the effective date of the Small Business Investment Act Amendments 
of 1967, or on January 1 of each of the following calendar years, 
whichever is less: (A) 100 percent, during 1968; (B) 75 percent, 
during 1969; (C) 50 percent, during 1970; (D) 25 percent, during 
1971; and (E) zero, during 1972 and thereafter. 
"(c) With respect to obligations or securities acquired prior to the 
effective date of the Small Business Investment Act Amendments of 
1967, and with respect to legally binding commitments issued prior to 
such date, the provisions of this section as in effect immediately prior 
to such effective date shall continue to apply." 
SEC. 208. Section 310(b) of the Small Business Investment Act of 
1958 is amended by adding after the first sentence thereof the following 
new sentence: "Each such company shall be examined at least once 
each year, except that the Administrator may waive examination in 
the case of a company whose operations have been suspended by rea-
son of the fact that the company is involved in litigation or is in 
receivership." 
SEC. 209. The first sentence of section 401(a) of the Small Business 
Investment Act of 1958 is amended by striking out "that are (1) eligi-
ble for loans under section 7(b) (3) of the Small Business Act, or (2) 
eligible for loans under title IV of the Economic Opportunity Act of 
1964,". 
SEC. 210. Section 308(g) of the Small Business Investment Act of 
1958 is amended (1) by inserting the paragraph designation "(1)" 
after " ( g ) " ; and (2) by adding the following new subparagraph: 
"(2) In its annual report for the year ending December 31, 1967, 
and in each succeeding annual report made pursuant to section 10(a) 
of the Small Business Act, the Administration shall include full and 
detailed accounts relative to the following matters: 
"(A) The Administration's recommendations with respect to 
the feasibility and organization of a small business capital bank 
Post, p. 272. 
"Venture cap* 
ital.»» 
Repeal, 
74 Stat. 196. 
15 use 684. 
Obligations and 
commitments, 
limitations. 
78 Stat. 146. 
15 use 686. 
Post, p. 272. 
Examinations. 
80 Stat. 1360. 
15 use 687b. 
Lease guaran-
tees. 
79 Stat. 482. 
15 use 692. 
15 use 636. 
42 use 2901-
2907. 
Annual report, 
contents. 
80 Stat. 1359. 
15 use 687. 
85-622 0-68—20 
.19-V' 
M e * 
272 
PDBLIC LAW 90-104-OCT. 11, 1967 
[81 STAT. 
to encourage private financing of small business investment com-
panies to replace Government financing of such companies. 
"(B) The Administration's plans to insure the provision of 
small business investment company financing to all areas of the 
country and to all eligible small business concerns including steps 
• 
"
* 
taken to accomplish same. 
"(C) Steps taken by the Administration to maximize recoup-
ment of Government funds incident to the inauguration and ad-
ministration of the small business investment company program 
and to insure compliance with statutory and regulatory standards 
relating thereto. 
"(d) An accounting by the Bureau of the Budget with respect 
to Federal expenditures to business by executive agencies, speci-
' '"•' 
fying the proportion of said expenditures going to business con-
cerns fallmg above and below small business size standards 
applicable to small business investment companies. 
"(E) An accounting by the Treasury Department with respect 
to tax revenues accrumg to the Government from business con-
cerns, incorporated and unincorporated, specifying the source of 
such revenues by concerns falling above and below the small 
business size standards applicable to small business investment 
companies. 
"(F) An accounting hj the Treasury Department with respect 
to both tax losses and mcreased tax revenues related to small 
business investment company financing of both individual and 
corporate business taxpayers. 
(G) Kecommendations of the Treasury Department with re-
spect to additional tax incentives to improve and facilitate the 
operations of small business investment companies and to en-
•^'"^ H i
^
< "
^ 
courage the use of their financing facilities by eligible small busi-
ness concerns. 
" (H) A report from the Securities and Exchange Commission 
en imerating actions undertaken by that agency to simplify and 
minimize the regulatory requirements governing small business 
investment companies under the Federal securities laws and to 
eliminate overlapping regulation and jurisdiction as between the 
Securities and Exchange Commission, the Administration, and 
other agencies of the executive branch. 
"(I) A report from the Securities and Exchange Commission 
with respect to actions taken to facilitate and stabilize the access 
of small business concerns to the securities markets. 
" (J) Actions undertaken by the Securities and Exchange Com-
mission to simplify compliance by small business investment 
companies with the requirements of the Investment Company Act 
54 Stat. 789. 
of 1940 aud to facilitate the election to be taxed as regulated in-
1
5 use 80a-i 
vestment companies pursuant to section 851 of the Internal Reve-
68A Stat. 268. 
iiuc Code of 1954." 
26 use 851. 
SEC. 211. The effective date of this title shall be ninety days after 
Effective date, 
euactmeut, except that, with respect to section 207, it shall be January 
1,1968. 
., 
TITLE I I I 
^^ • 
ProTeilion Ac*" 
^Ec. 301. Thls title may be cited as the "Small Business Protection 
of 1967. 
Act of 1967". 
SEC. 302. The Administrator of the Small Business Administration 
shall conduct a special study of the impact on small business concerns 
of robbery, burglary, shoplifting, vandalism, and other criminal ac-
tivities, with a view to determining ways in which such concerns may 
best protect themselves against such activities. 
81 STAT.] 
PUBLIC LAW 90-105-OCT. 11, 1967 
273 
SEC. 303. The Administrator shall report to the President and to the pr^sid'ent°and 
Confess the results of the study conducted pursuant to this title, in- congress. 
eluding such recommendations as he may deem appropriate for ad-
ministrative and legislative action, within one year after the date of 
enactment of this title. 
Approved October 11, 1967. 
Public Law 90-105 
AN ACT 
October 11, 1967 
To provide for the acquisition of career status by certain temporary employees 
[s. 1320] 
of the Federal Government, and for other purposes. 
Federal em-
ployees, career 
Be it enacted hy the Senate and House of Representatives 
of the 
United States of America in Congress assembled^ That (a) subchapter 
I of chapter 33 of title 5, United States Code, is amended by inserting status 
immediately after section 3304 the following new section: 
^° ^^'^^' '
*
^
® 
"§ 3304a. Competitive service; career appointment after 3 years* 
temporary service 
"(a) An individual serving in a position in the competitive service 
under an indefinite appointment or a temporary appointment pending 
establishment of a register (other than an individual serving under an 
overseas limited appointment, in the postal field service, or in GrS-16, 
GS-17, or GS-18) acquires competitive status and is entitled to have 
his appointment converted to a career appointment, without condition, 
when— 
" (1) he completes, without break in service of more than 30 
days, a total of at least 3 years of service in such a position; 
"(2) he passes a suitable noncompetitive examination; 
"(3) the appointing authority (A) recommends to the Civil 
Service Commission that the appointment of the individual be 
converted to a career appointment and (B) certifies to the Com-
mission that the work performance of the individual for the past 
12 months has been satisfactory; and 
"(4) he meets Commission qualification requirements for the 
position and is otherwise eligible for career appointment. 
"(b) The employing agency shall terminate the appointment of an 
individual serving in a position in the competitive service under an 
indefinite or temporary appointment described in subsection (a) of 
this section, not later than 90 days after he has completed the 3-year 
period referred to in subsection (a) (1) of this section, if, prior to the 
close of such 90-day period, such individual has not met the require-
ments and conditions of subparagraphs (2) to (4), inclusive, of sub-
section (a) of this section. 
"(c) In computing years of service under subsection (a)(1) of 
this section for an individual who leaves a position in the competitive 
service to enter the armed forces and is reemployed in such a position 
within 120 days after separation under honorable conditions, the 
period from the date he leaves his position to the date he is reemployed 
IS included. 
"(d) The Civil Service Commission may prescribe regulations 
necessary for the administration of this section." 
(b) The analysis of subchapter I of chapter 33 of title 5, United 
States Code, is amended by adding the following new item imme-
diately below item 3304: 
"3304a. Competitive service; career appointment after 3 years' temporary 
service."