[Congressional Bills 108th Congress]
[From the U.S. Government Publishing Office]
[S. 1375 Engrossed in Senate (ES)]
108th CONGRESS
1st Session
S. 1375
_______________________________________________________________________
AN ACT
To provide for the reauthorization of programs administered by the
Small Business Administration, 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; TABLE OF CONTENTS.
(a) Short Title.--This Act may be cited as the ``Small Business
Administration 50th Anniversary Reauthorization Act of 2003''.
(b) Table of Contents.--The table of contents for this Act is as
follows:
Sec. 1. Short title; table of contents.
Sec. 2. Effective date.
TITLE I--GENERAL PROVISIONS
Subtitle A--Administration Accountability
Sec. 101. Document retention and investigations.
Sec. 102. Management of the Small Business Administration.
Subtitle B--Authorizations
Sec. 111. Program authorization levels.
Sec. 112. Additional reauthorizations.
TITLE II--FINANCIAL ASSISTANCE
Subtitle A--7(a) Loan Guarantee Program
Sec. 201. National Preferred Lenders Pilot Program.
Sec. 202. Extension of program participation fees.
Sec. 203. Loans sold in secondary market.
Sec. 204. Clarification of eligibility for veterans.
Sec. 205. Enhancement of low documentation loan program.
Sec. 206. Increased loan amounts for exporters.
Subtitle B--Microloan Program
Sec. 211. Microloan program improvements.
Subtitle C--Lender Oversight
Sec. 221. Examination and review fees.
Sec. 222. Enforcement authority for Small Business Lending Companies
and non-federally regulated SBA lenders.
Sec. 223. Definitions for Small Business Lending Companies and non-
federally regulated SBA lenders.
Subtitle D--Disaster Assistance Loan Program
Sec. 231. Conforming amendment for disaster assistance loan program.
Sec. 232. Disaster relief for small business concerns damaged by
drought.
Sec. 233. Disaster mitigation pilot program.
Subtitle E--504 Loan Program
Sec. 241. Extension of user fees.
Sec. 242. Amortized loan loss reserve fund.
Sec. 243. Alternative loss reserve for certain premier certified
lenders.
Sec. 244. Debenture size.
Sec. 245. Job creation or retention standards.
Sec. 246. Simplified applications.
Sec. 247. Child care lending pilot program.
Sec. 248. Definition of rural area.
Subtitle F--Surety Bond Program
Sec. 251. Clarification of maximum surety bond guarantee.
Sec. 252. Authorization of Preferred Surety Bond Guarantee Program.
Subtitle G--Miscellaneous
Sec. 261. Coordination of SBA loans.
Sec. 262. Leasing options for 7(a) and 504 borrowers.
Sec. 263. Calculation of financing limitation for small business
investment companies.
Sec. 264. Establishing alternative size standard.
Subtitle H--New Markets Venture Capital
Sec. 271. Time frame for raising private capital.
Sec. 272. Definition of low-income geographic area.
Subtitle I--Small Business Investment Company Program
Sec. 281. Investment of excess funds.
Sec. 282. Maximum prioritized payment rate.
Sec. 283. Improved distribution requirements.
Subtitle J--Small Business Intermediary Lending Pilot Program
Sec. 291. Short title.
Sec. 292. Findings.
Sec. 293. Small Business Intermediary Lending Pilot Program.
TITLE III--ENTREPRENEURIAL DEVELOPMENT PROGRAMS
Subtitle A--Office of Entrepreneurial Development
Sec. 301. Service Corps of Retired Executives.
Sec. 302. Small Business Development Center Program.
Sec. 303. PRIME reauthorization and transfer to the Small Business Act.
Subtitle B--Women's Small Business Ownership Programs
Sec. 311. Office of Women's Business Ownership.
Sec. 312. Women's Business Center Program.
Sec. 313. National Women's Business Council.
Sec. 314. Interagency Committee on Women's Business Enterprise.
Sec. 315. Preserving the independence of the National Women's Business
Council.
Subtitle C--Office of Native American Affairs
Sec. 321. Short title.
Sec. 322. Native American Small Business Development Program.
Sec. 323. Pilot programs.
Subtitle D--Office of Veterans Business Development
Sec. 331. Advisory Committee on Veterans Business Affairs.
Sec. 332. Outreach grants for veterans.
Sec. 333. Authorization of appropriations.
TITLE IV--SMALL BUSINESS PROCUREMENT OPPORTUNITIES
Sec. 401. Contract consolidation.
Sec. 402. Agency accountability.
Sec. 403. Small business participation in prime contracting.
Sec. 404. Small business participation in subcontracting.
Sec. 405. Evaluating subcontract participation in awarding contracts.
Sec. 406. Direct payments to subcontractors.
Sec. 407. Women-owned small business industry study.
Sec. 408. HUBZone authorizations.
Sec. 409. Definition of HUBZone; treatment of certain former military
installation lands as HUBZones.
Sec. 410. Definition of HUBZone small business concern.
Sec. 411. Acquisition regulations.
TITLE V--MISCELLANEOUS
Sec. 501. Minority Small Business and Capital Ownership Development
Program.
Sec. 502. Extension of authority for technology assistance program.
Sec. 503. BusinessLINC report to Congress.
SEC. 2. EFFECTIVE DATE.
(a) In General.--This Act and the amendments made by this Act shall
take effect on October 1, 2003.
(b) Rulemaking Authority.--
(1) Proposed regulations.--Except as otherwise specifically
provided in this Act, not later than 180 days after the date of
enactment of this Act, the Administrator of the Small Business
Administration (referred to in this Act as the
``Administrator'' and the ``Administration'', respectively)
shall publish proposed regulations to carry out the provisions
of this Act and the amendments made by this Act.
(2) Final regulations.--Except as otherwise specifically
provided in this Act, not later than 300 days after the date of
enactment of this Act, the Administrator shall issue final
regulations to carry out the provisions of this Act and the
amendments made by this Act.
TITLE I--GENERAL PROVISIONS
Subtitle A--Administration Accountability
SEC. 101. DOCUMENT RETENTION AND INVESTIGATIONS.
Section 10(e) of the Small Business Act (15 U.S.C. 639(e)) is
amended by striking the matter preceding paragraph (2) and inserting
the following:
``(e) Document Retention; Investigations.--
``(1) Document retention.--The Administrator and the
Inspector General of the Administration shall--
``(A) retain all documents and records, including
correspondence, records of inquiry, memoranda
(including those relating to all investigations
conducted by or for the Administration), reports,
studies, analyses, contracts, agreements, opinions,
computer entries, e-mail messages, forms, manuals,
briefing materials, press releases, and books for a
period of not less than 2 years from the date such
documents are created;
``(B) keep the items described in subparagraph (A)
available at all times for inspection and examination
by the Committee on Small Business and Entrepreneurship
of the Senate and the Committee on Small Business of
the House of Representatives, or their duly authorized
representatives; and
``(C) upon the written request of the Committee on
Small Business and Entrepreneurship of the Senate or
the Committee on Small Business of the House of
Representatives pursuant to subparagraph (B), the
Administrator or the Inspector General, as applicable,
shall make such documents or records available to the
requesting committee or its duly authorized
representative within 5 business days of the request,
and if a document or record cannot be made available
within such timeframe, the Administrator or the
Inspector General, as applicable, shall provide the
requesting committee with a written explanation stating
the reason that each document or record requested has
not been provided and a date certain for its
production.''.
SEC. 102. MANAGEMENT OF THE SMALL BUSINESS ADMINISTRATION.
Section 4 of the Small Business Act (15 U.S.C. 633) is amended--
(1) by striking ``Sec. 4.'' and inserting the following:
``SEC. 4. MANAGEMENT OF THE SMALL BUSINESS ADMINISTRATION.'';
(2) in subsection (a), by striking ``(a)'' and inserting
the following:
``(a) Establishment.--'';
(3) in subsection (b)--
(A) by striking ``(b)(1)'' and inserting the
following:
``(b) Authority of Administrator.--
``(1) In general.--
``(A) Appointment.--'';
(B) in paragraph (1)--
(i) by striking ``The Administrator shall
not engage'' and inserting the following:
``(B) Sole employment.--The Administrator shall not
engage'';
(ii) by striking ``In carrying out'' and
inserting the following:
``(C) Nondiscrimination; special consideration for
veterans.--In carrying out''; and
(iii) by striking ``The President'' and
inserting the following:
``(D) Appointment of deputy administrator;
associate administrators.--The President''; and
(C) in paragraph (2), by striking ``the
Administrator also'' and inserting ``Responsibilities
of Administrator.--The Administrator''; and
(4) by adding at the end the following:
``(g) Office of Lender Oversight.--The Director of the Office of
Lender Oversight shall--
``(1) formulate, execute, and promote policies and
procedures of the Administration that provide adequate and
effective oversight and review of lenders participating in, or
applying to participate in, the loan and loan guaranty programs
for small business concerns under this Act and the Small
Business Investment Act of 1958 (15 U.S.C. 661 et seq.); and
``(2) report directly to the Chief Operating Officer of the
Administration.''.
Subtitle B--Authorizations
SEC. 111. PROGRAM AUTHORIZATION LEVELS.
Section 20 of the Small Business Act (15 U.S.C. 631 note) is
amended--
(1) in subsection (a)(1), by striking ``certification''
each place that term appears and inserting ``accreditation'';
(2) by striking subsections (c) through (h) and inserting
the following:
``(c) Disaster Mitigation Pilot Program.--The following program
levels are authorized for loans under section 7(b)(1)(C):
``(1) $15,000,000 for fiscal year 2003.
``(2) $15,000,000 for fiscal year 2004.
``(3) $15,000,000 for fiscal year 2005.
``(4) $15,000,000 for fiscal year 2006.'';
(3) by redesignating subsection (i) as subsection (d); and
(4) by adding at the end the following:
``(e) Fiscal Year 2004.--
``(1) Program levels.--The following program levels are
authorized for fiscal year 2004:
``(A) For the programs authorized by this Act, the
Administration is authorized to make--
``(i) $70,000,000 in technical assistance
grants, as provided in section 7(m); and
``(ii) $100,000,000 in direct loans, as
provided in section 7(m).
``(B) For the programs authorized by this Act, the
Administration is authorized to make $21,550,000,000 in
deferred participation loans and other financings. Of
such sum, the Administration is authorized to make--
``(i) $16,000,000,000 in general business
loans, as provided in section 7(a);
``(ii) $5,000,000,000 in certified
development company financings, as provided in
section 7(a)(13) of this Act and section 504 of
the Small Business Investment Act of 1958;
``(iii) $500,000,000 in loans, as provided
in section 7(a)(21); and
``(iv) $50,000,000 in loans, as provided in
section 7(m).
``(C) For the programs authorized by title III of
the Small Business Investment Act of 1958, the
Administration is authorized to make--
``(i) $4,000,000,000 in purchases of
participating securities; and
``(ii) $3,000,000,000 in guarantees of
debentures.
``(D) 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 $6,000,000,000, of which not
more than 50 percent may be in bonds approved pursuant
to section 411(a)(3) of that Act.
``(E) The Administration is authorized to make
grants or enter into cooperative agreements for a total
amount of $7,000,000 for the Service Corps of Retired
Executives program authorized by section 8(b)(1).
``(2) Additional authorizations.--
``(A) There are authorized to be appropriated to
the Administration for fiscal year 2004 such sums as
may be necessary to carry out the provisions of this
Act not elsewhere provided for, including
administrative expenses and necessary loan capital for
disaster loans pursuant to section 7(b), and to carry
out title IV of the Small Business Investment Act of
1958, including salaries and expenses of the
Administration.
``(B) Notwithstanding any other provision of this
paragraph, for fiscal year 2004--
``(i) no funds are authorized to be used as
loan capital for the loan program authorized by
section 7(a)(21) except by transfer from
another Federal department or agency to the
Administration, unless the program level
authorized for general business loans under
paragraph (1)(B)(i) is fully funded; and
``(ii) the Administration may not approve
loans on its own behalf or on behalf of any
other Federal department or agency, by contract
or otherwise, under terms and conditions other
than those specifically authorized under this
Act or the Small Business Investment Act of
1958, except that it may approve loans under
section 7(a)(21) of this Act in gross amounts
of not more than $2,000,000.
``(f) Fiscal Year 2005.--
``(1) Program levels.--The following program levels are
authorized for fiscal year 2005:
``(A) For the programs authorized by this Act, the
Administration is authorized to make--
``(i) $75,000,000 in technical assistance
grants, as provided in section 7(m); and
``(ii) $105,000,000 in direct loans, as
provided in 7(m).
``(B) For the programs authorized by this Act, the
Administration is authorized to make $22,300,000,000 in
deferred participation loans and other financings. Of
such sum, the Administration is authorized to make--
``(i) $16,500,000,000 in general business
loans, as provided in section 7(a);
``(ii) $5,250,000,000 in certified
development company financings, as provided in
section 7(a)(13) of this Act and section 504 of
the Small Business Investment Act of 1958;
``(iii) $500,000,000 in loans, as provided
in section 7(a)(21); and
``(iv) $50,000,000 in loans, as provided in
section 7(m).
``(C) For the programs authorized by title III of
the Small Business Investment Act of 1958, the
Administration is authorized to make--
``(i) $4,250,000,000 in purchases of
participating securities; and
``(ii) $3,250,000,000 in guarantees of
debentures.
``(D) 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 $6,000,000,000, of which not
more than 50 percent may be in bonds approved pursuant
to section 411(a)(3) of that Act.
``(E) The Administration is authorized to make
grants or enter into cooperative agreements for a total
amount of $7,000,000 for the Service Corps of Retired
Executives program authorized by section 8(b)(1).
``(2) Additional authorizations.--
``(A) There are authorized to be appropriated to
the Administration for fiscal year 2005 such sums as
may be necessary to carry out the provisions of this
Act not elsewhere provided for, including
administrative expenses and necessary loan capital for
disaster loans pursuant to section 7(b), and to carry
out title IV of the Small Business Investment Act of
1958, including salaries and expenses of the
Administration.
``(B) Notwithstanding any other provision of this
paragraph, for fiscal year 2005--
``(i) no funds are authorized to be used as
loan capital for the loan program authorized by
section 7(a)(21) except by transfer from
another Federal department or agency to the
Administration, unless the program level
authorized for general business loans under
paragraph (1)(B)(i) is fully funded; and
``(ii) the Administration may not approve
loans on its own behalf or on behalf of any
other Federal department or agency, by contract
or otherwise, under terms and conditions other
than those specifically authorized under this
Act or the Small Business Investment Act of
1958, except that it may approve loans under
section 7(a)(21) of this Act in gross amounts
of not more than $2,000,000.
``(g) Fiscal Year 2006.--
``(1) Program levels.--The following program levels are
authorized for fiscal year 2006:
``(A) For the programs authorized by this Act, the
Administration is authorized to make--
``(i) $80,000,000 in technical assistance
grants, as provided in section 7(m); and
``(ii) $110,000,000 in direct loans, as
provided in 7(m).
``(B) For the programs authorized by this Act, the
Administration is authorized to make $23,050,000,000 in
deferred participation loans and other financings. Of
such sum, the Administration is authorized to make--
``(i) $17,000,000,000 in general business
loans, as provided in section 7(a);
``(ii) $5,500,000,000 in certified
development company financings, as provided in
section 7(a)(13) of this Act and section 504 of
the Small Business Investment Act of 1958;
``(iii) $500,000,000 in loans, as provided
in section 7(a)(21); and
``(iv) $50,000,000 in loans, as provided in
section 7(m).
``(C) For the programs authorized by title III of
the Small Business Investment Act of 1958, the
Administration is authorized to make--
``(i) $4,500,000,000 in purchases of
participating securities; and
``(ii) $3,500,000,000 in guarantees of
debentures.
``(D) 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 $6,000,000,000, of which not
more than 50 percent may be in bonds approved pursuant
to section 411(a)(3) of that Act.
``(E) The Administration is authorized to make
grants or enter into cooperative agreements for a total
amount of $7,000,000 for the Service Corps of Retired
Executives program authorized by section 8(b)(1).
``(2) Additional authorizations.--
``(A) There are authorized to be appropriated to
the Administration for fiscal year 2006 such sums as
may be necessary to carry out the provisions of this
Act not elsewhere provided for, including
administrative expenses and necessary loan capital for
disaster loans pursuant to section 7(b), and to carry
out title IV of the Small Business Investment Act of
1958, including salaries and expenses of the
Administration.
``(B) Notwithstanding any other provision of this
paragraph, for fiscal year 2006--
``(i) no funds are authorized to be used as
loan capital for the loan program authorized by
section 7(a)(21) except by transfer from
another Federal department or agency to the
Administration, unless the program level
authorized for general business loans under
paragraph (1)(B)(i) is fully funded; and
``(ii) the Administration may not approve
loans on its own behalf or on behalf of any
other Federal department or agency, by contract
or otherwise, under terms and conditions other
than those specifically authorized under this
Act or the Small Business Investment Act of
1958, except that it may approve loans under
section 7(a)(21) of this Act in gross amounts
of not more than $2,000,000.''.
SEC. 112. ADDITIONAL REAUTHORIZATIONS.
(a) Drug-Free Workplace Program Assistance.--Section 21(c)(3)(T) of
the Small Business Act (15 U.S.C. 648(c)(3)(T)) is amended by striking
``October 1, 2003'' and inserting ``October 1, 2006''.
(b) Paul D. Coverdell Drug-Free Workplace Program.--Section
27(g)(1) of the Small Business Act (15 U.S.C. 654(g)(1)) is amended by
striking ``2001 through 2003'' and inserting ``2004 through 2006''.
(c) Small Business Development Centers.--Section 21(a)(4)(C) of the
Small Business Act (15 U.S.C. 648(a)(4)(C)) is amended--
(1) by amending clause (vii) to read as follows:
``(vii) Authorization of appropriations.--There are
authorized to be appropriated to carry out this
subparagraph--
``(I) $125,000,000 for fiscal year 2004;
``(II) $130,000,000 for fiscal year 2005;
and
``(III) $135,000,000 for fiscal year
2006.'';
(2) by redesignating clause (viii) as clause (ix); and
(3) by inserting after clause (vii) the following:
``(viii) Limitation.--From the funds appropriated
pursuant to clause (vii), the Administration shall
reserve not less than $1,000,000 in each fiscal year to
develop portable assistance for startup and
sustainability non-matching grant programs to be
conducted by eligible small business development
centers in communities that are economically challenged
as a result of a business or government facility
downsizing or closing, which has resulted in the loss
of jobs or small business instability. A non-matching
grant under this clause shall not exceed $100,000, and
shall be used for small business development center
personnel expenses and related small business programs
and services.''.
TITLE II--FINANCIAL ASSISTANCE
Subtitle A--7(a) Loan Guarantee Program
SEC. 201. NATIONAL PREFERRED LENDERS PILOT PROGRAM.
Section 7(a)(2) of the Small Business Act (15 U.S.C. 636(a)(2)(C))
is amended by adding at the end the following:
``(E) National preferred lenders pilot program.--
``(i) Establishment.--There is established
the National Preferred Lenders Pilot Program, a
3-year pilot program in which a participant in
the Preferred Lenders Program may operate as a
preferred lender in any State if such lender
meets the criteria established by the
Administration.
``(ii) Eligibility criteria.--For purposes
of clause (i), criteria established by the
Administration shall include--
``(I) demonstrated proficiency in
the Preferred Lenders Program for not
less than 3 years;
``(II) annual loan approvals of a
minimum number of 7(a) Preferred
Lenders Program loans, excluding SBA
Express loans, as determined by the
Administration;
``(III) operation by the lender in
not less than 5 States or 10 Small
Business Administration districts;
``(IV) satisfactory centralized
approval, loan servicing, and loan
liquidation functions and processes;
and
``(V) consideration of any comments
and recommendations that may be
received from any District Director or
Regional Administrator relating to the
performance of the applicant.
``(iii) Terms and conditions.--Applicants
shall be approved under the following terms and
conditions:
``(I) Term.--Each participant
approved under this subparagraph shall
be eligible to make loans for up to 1
year under the program established
under this subparagraph.
``(II) Renewal.--At the expiration
of the term described in subclause (I),
the authority of a participant to make
loans under this subparagraph may be
renewed based on a review of
performance during the initial term.
``(III) Effect of failure.--Failure
to meet the criteria under this
subparagraph shall not effect the
eligibility of a participant to
continue as a preferred lender in
States or districts in which it is in
good standing.''.
SEC. 202. EXTENSION OF PROGRAM PARTICIPATION FEES.
Section 7(a) of the Small Business Act (15 U.S.C. 636(a)) is
amended--
(1) in paragraph (12) by striking ``(b)'' and inserting the
following:
``(B)'';
(2) in paragraph (18)--
(A) in subparagraph (A)--
(i) in clause (i), by striking ``2
percent'' and inserting ``1 percent''; and
(ii) in clause (ii), by striking ``3
percent'' and inserting ``2.5 percent''; and
(B) by striking subparagraph (C); and
(3) in paragraph (23)(A), by striking ``0.5 percent'' and
all that follows through ``equal to''.
SEC. 203. LOANS SOLD IN SECONDARY MARKET.
Section 5(g) of the Small Business Act (15 U.S.C. 634(g)) is
amended by adding at the end the following:
``(6) Trust certificates issued pursuant to this subsection may be
comprised of a pool of loans, guaranteed by the Administration, with
varying interest rates. The interest rate paid by such certificates
shall be equal to the weighted average of the interest rates of the
loans in the pool. The Administration shall prescribe the maximum
amount of variation in the loan characteristics in order to enhance the
marketability of the pool.''.
SEC. 204. CLARIFICATION OF ELIGIBILITY FOR VETERANS.
Section 7(a)(8) of the Small Business Act (15 U.S.C. 636(a)(8)) is
amended to read as follows:
``(8) The Administration may make loans under this
subsection to--
``(A) small business concerns owned and controlled
by veterans (as defined in section 101(2) of title 38,
United States Code);
``(B) small business concerns owned and controlled
by disabled veterans (as defined in section 4211(3) of
title 38, United States Code); and
``(C) small business concerns owned and controlled
by members of Reserve components of the Armed Forces
(as defined in section 101(c)(6) of title 10, United
States Code).''.
SEC. 205. ENHANCEMENT OF LOW DOCUMENTATION LOAN PROGRAM.
Section 7(a)(25)(C) of the Small Business Act (15 U.S.C.
636(a)(25)(C)) is amended by striking ``$100,000'' and inserting
``$250,000''.
SEC. 206. INCREASED LOAN AMOUNTS FOR EXPORTERS.
Section 7(a) of the Small Business Act (15 U.S.C. 636(a)) is
amended--
(1) in paragraph (3)--
(A) in subparagraph (A), by inserting before the
semicolon at the end the following: ``and paragraph
(14)''; and
(B) in subparagraph (B), by striking ``$1,250,000''
and inserting ``$1,300,000''; and
(2) in paragraph (14), by adding at the end the following:
``(D) The total amount of financings under this paragraph
that are outstanding and committed (by participation or
otherwise) to the borrower from the business loan and
investment fund established under this Act may not exceed
$1,300,000 and the gross loan amount under this paragraph may
not exceed $2,600,000.''.
Subtitle B--Microloan Program
SEC. 211. MICROLOAN PROGRAM IMPROVEMENTS.
(a) Intermediary Eligibility Requirements.--Section 7(m)(2) of the
Small Business Act (15 U.S.C. 636(m)(2)) is amended--
(1) in subparagraph (A), by striking ``in paragraph (10);
and'' and inserting ``of the term `intermediary' under
paragraph (11);''; and
(2) in subparagraph (B)--
(A) by striking ``(B) has at least'' and inserting
the following:
``(B) has--
``(i) at least''; and
(B) by striking the period at the end and inserting
the following: ``; or
``(ii) a full-time employee who has not
less than 3 years experience making microloans
to startup, newly established, or growing small
business concerns; and
``(C) has at least 1 year experience providing, as
an integral part of its microloan program, intensive
marketing, management, and technical assistance to its
borrowers.''.
(b) Conforming Change in Average Smaller Loan Size.--Section
7(m)(3)(F)(iii) of the Small Business Act (15 U.S.C. 636(m)(3)(F)(iii))
is amended by striking ``$7,500'' and inserting ``$10,000''.
(c) Limitation on Third Party Technical Assistance.--Section
7(m)(4)(E)(ii) of the Small Business Act (15 U.S.C. 636(m)(4)(E)(ii))
is amended--
(1) by striking ``Technical assistance'' and inserting
``Third party technical assistance''; and
(2) by striking ``25 percent'' and inserting ``30
percent''.
(d) Loan Terms.--Section 7(m)(1)(B)(i) of the Small Business Act
(15 U.S.C. 636(m)(1)(B)(i)) is amended by striking ``short-term''.
(e) Report on Transferred Amounts.--Section 7(m)(9)(B) of the Small
Business Act (15 U.S.C. 636(m)(9)(B)) is amended--
(1) by striking ``The Administration'' and inserting the
following:
``(i) In general.--The Administration'';
(2) by striking the period after ``financing''; and
(3) by adding at the end the following:
``(ii) Report.--The Administration shall
report, in its annual budget request and
performance plan to Congress, on the
performance by the Administration of the
requirements of clause (i).''.
(f) Accurate Subsidy Model.--Section 7(m) of the Small Business Act
(15 U.S.C. 636(m)) is amended by adding at the end the following:
``(14) Improved subsidy model.--The Administrator shall
develop a subsidy model for the microloan program under this
subsection, to be used in the fiscal year 2005 budget, that is
more accurate than the subsidy model in effect on the day
before the date of enactment of this paragraph.''.
(g) Increased Flexibility for Providing Technical Assistance to
Potential Borrowers.--Section 7(m)(4)(E)(i) of the Small Business Act
(15 U.S.C. 636(m)(4)(E)(i)) is amended by striking ``25 percent'' and
inserting ``30 percent''.
Subtitle C--Lender Oversight
SEC. 221. EXAMINATION AND REVIEW FEES.
Section 5(b) of the Small Business Act (15 U.S.C. 634(b)) is
amended--
(1) in the matter preceding paragraph (1), by striking
``(b) In the performance'' and inserting the following:
``(b) Authority of Administrator.--In the performance'';
(2) in paragraph (12), by striking ``and'' at the end;
(3) in paragraph (13), by striking the period at the end
and inserting ``; and''; and
(4) by adding at the end the following:
``(14) require lenders participating in the program
authorized by section 7(a), including Small Business Lending
Companies, to pay reasonable examination and review fees, which
shall be--
``(A) deposited in the account for salaries and
expenses of the Administration; and
``(B) made available only for the costs of
examinations, reviews, and other lender oversight
activities concerning lenders participating in the
program authorized by section 7(a).''.
SEC. 222. ENFORCEMENT AUTHORITY FOR SMALL BUSINESS LENDING COMPANIES
AND NON-FEDERALLY REGULATED SBA LENDERS.
The Small Business Act (15 U.S.C. 631 et seq.) is amended--
(1) by redesignating section 36 as section 37; and
(2) by inserting after section 35 the following new
section:
``sec. 36. enforcement authority for small business lending companies
and non-federally regulated sba lenders
``(a) Defined Term.--In this section the term `management official'
means an officer, director, general partner, manager, employee, agent,
or other participant in the management or conduct of the affairs of a
Small Business Lending Company or non-federally regulated SBA lender
under section 7(a).
``(b) Authorization.--
``(1) Small business lending companies.--The Administration
is authorized to--
``(A) supervise the safety and soundness of Small
Business Lending Companies;
``(B) set capital standards for, regulate, examine,
and enforce laws relating to Small Business Lending
Companies; and
``(C) prescribe regulations governing the
operations, oversight, and enforcement of Small
Business Lending Companies, in accordance with the
purposes of this Act.
``(2) Non-federally regulated sba lenders.--The
Administration is authorized to--
``(A) supervise the safety and soundness of non-
federally regulated SBA lenders;
``(B) regulate, examine, and enforce laws relating
to lending by non-federally regulated SBA lenders under
section 7(a); and
``(C) prescribe regulations governing the
operations, oversight, and enforcement of non-federally
regulated SBA lenders, in accordance with the purposes
of this Act.
``(c) Capital Directives.--The Administration may--
``(1) deem the failure of a Small Business Lending Company
to maintain capital at or above the minimum capital level
established by the Administration as an unsafe and unsound
practice; and
``(2) in addition to, or in lieu of, any other action
authorized by law, issue a directive to a Small Business
Lending Company that fails to return or maintain capital at or
above its required level, as established by the Administration.
``(d) Forfeiture of Authority for Noncompliance.--
``(1) In general.--Subject to the provisions of subsection
(g), if any Small Business Lending Company violates any of the
provisions of this Act, or any related regulation, such company
shall forfeit all of the rights, privileges, and franchises
under this Act.
``(2) Adjudication.--A company under paragraph (1) shall
not forfeit its rights, privileges, and franchises under this
Act, unless a court of the United States, with jurisdiction
over the judicial district in which the principal place of
business of such company is located, determines, in a suit
brought by, or on behalf of, the Administrator, that such
company violated this Act, or regulations promulgated pursuant
to this Act.
``(e) Revocation or Suspension of Authority.--
``(1) In general.--Subject to the provisions of subsection
(g), the Administration may revoke or suspend the authority of
a participating lender to make, service, or liquidate business
loans under section 7(a) if the participating lender--
``(A) knowingly makes false statements in any
written statement required under this Act or any
regulation issued under this Act;
``(B) fails to state, in any written statement
required under this Act or any regulation issued under
this Act, a material fact necessary in order to make
the statement not misleading in the light of the
circumstances under which the statement was made;
``(C) willfully or repeatedly violates--
``(i) any provision of this Act;
``(ii) any rule or regulation issued under
this Act; or
``(iii) any condition imposed by the
Administration with any application, request,
or agreement; or
``(D) violates any cease and desist order issued by
the Administration under this section.
``(2) Length of suspension.--The suspension under paragraph
(1) shall remain in full force and effect until the
Administration issues a written notice of termination.
``(3) Notification.--If the lending authority of a lender
is revoked under paragraph (1), the lender shall send
notification, not later than 30 days after such revocation, to
all existing borrowers that such authority has been revoked and
that a new servicer has been appointed to service their loans.
If the lender fails to provide such notification before the
deadline, the Administration shall provide such notification to
borrowers.
``(4) Delegation.--The Administration may delegate the
authority to suspend a participating lender's authority to make
loans under section 7(a), but shall not delegate the authority
to revoke a participating lender's authority to make such
loans.
``(f) Cease and Desist Orders.--If a participating lender or
management official has violated, or is about to violate any provision
of this Act, or any related regulation, the Administration, subject to
the provisions of subsection (g), may--
``(1) order the participating lender or management official
to--
``(A) cease and desist from such violation; and
``(B) take, or refrain from, such action as the
Administration deems necessary to ensure compliance
with the Act and related regulations; and
``(2) suspend the authority of such participating lender
pending full compliance with all orders issued under paragraph
(1).
``(g) Process for Revocation or Suspension of Authority or Cease
and Desist Orders.--
``(1) Notice.--Before revoking or suspending the authority
of a participating lender pursuant to subsection (e) or issuing
a cease and desist order pursuant to subsection (f), the
Administration shall--
``(A) provide notice to the participating lender
that such action is contemplated; and
``(B) provide the participating lender with an
opportunity to show cause why such action should not be
taken.
``(2) Contents.--A notice under paragraph (1) shall
contain--
``(A) a statement of the matters of fact and law
asserted by the Administration;
``(B) a description of the legal authority and
jurisdiction under which a hearing is to be held; and
``(C) the time and place of the hearing that will
be held before the Administration.
``(3) Hearing.--
``(A) In general.--A hearing under this subsection
shall take place before the Office of Hearings and
Appeals of the Administration.
``(B) Subpoena.--The Administration may require by
subpoena--
``(i) the attendance and testimony of
witnesses; and
``(ii) the production of all books, papers,
e-mails, faxes, and documents relating to the
hearing under this paragraph.
``(C) Enforcement of subpoena.--If a party disobeys
a subpoena issued under subparagraph (B), the
Administration, or any party to a proceeding before the
Administration, may invoke the aid of any court of the
United States to require--
``(i) the attendance and testimony of
witnesses; and
``(ii) the production of books, papers, e-
mails, faxes, and documents.
``(D) Witness fees.--Witnesses summoned before the
Administration shall be paid, by the party at whose
instance they were called, the same fees and mileage
that are paid witnesses in the courts of the United
States.
``(4) Issuance of order.--
``(A) In general.--If the Administration, after a
hearing, or a waiver thereof, determines on the record
that an order revoking or suspending the authority of a
participating lender under section 7(a) or a cease and
desist order should be issued, the Administration shall
promptly issue such order to the participating lender
and any other person involved.
``(B) Contents.--The order issued under
subparagraph (A) shall contain--
``(i) a statement of the findings of the
Administration;
``(ii) the reasons therefore; and
``(iii) the effective date of the order.
``(C) Effective date.--
``(i) Cease and desist order.--A cease and
desist order issued under this paragraph shall
become effective on the date specified therein.
``(ii) Revocation or suspension.--An order
revoking or suspending the authority of a
participating lender under section 7(a) shall
be final and conclusive 30 days after the date
of issuance of such order unless the
participating lender files an appeal under
paragraph (5).
``(5) Appeal.--
``(A) Appeal by right.--Not later than 30 days
after an order is issued under paragraph (4), a
participating lender may appeal such order by filing a
petition requesting that the Administration's order be
set aside or modified with the clerk of the United
States district court for the judicial district in
which such participating lender has its principal place
of business.
``(B) Leave of court.--After the expiration of the
period described in subparagraph (A), a participating
lender may file a petition of appeal only by leave of
court and upon a showing of reasonable grounds for
failure to timely file such petition.
``(C) Delivery of petition.--Upon receiving a
petition under this paragraph, the clerk of the court
shall immediately deliver a copy of the petition to the
Administration, which shall certify and file in the
court a transcript of the record upon which the order
complained of was entered.
``(D) Amendment of petition.--If the Administration
amends or sets aside its order, in whole or in part,
before the record is filed under subparagraph (C), the
petitioner may amend the petition within such time as
the court may determine, on notice to the
Administration.
``(E) Effect of petition.--The filing of a petition
for review shall not affect the operation of the order
of the Administration, but the district court may
restrain or suspend, in whole or in part, the operation
of the order pending the final hearing and
determination of the petition.
``(F) Authority of court.--
``(i) In general.--Except as provided under
clause (ii), the district court may affirm,
modify, or set aside any order of the
Administration issued under this subsection.
``(ii) Limitation.--The district court
shall not consider an objection to an order of
the Administration unless such objection was
presented to the Administration or there were
reasonable grounds for failure to do so.
``(G) Additional evidence.--
``(i) In general.--If the district court
determines that the just and proper disposition
of the case requires the taking of additional
evidence, the court may take additional
evidence and findings of fact, or may order the
Administration to reopen the hearing for the
taking of such evidence, in such manner and
upon such terms and conditions as the court
determines to be proper.
``(ii) Modification of findings.--The
Administration may modify its findings as to
the facts, or make new findings, by reason of
the additional evidence so taken, and it shall
file its modified or new findings and the
amendments, if any, of its order, with the
record of such additional evidence.
``(6) Enforcement of order.--
``(A) In general.--If any participating lender or
other person against which an order is issued under
this section fails to obey the order, the
Administration may file an application with the United
States district court within the judicial district
where the participating lender has its principal place
of business, for the enforcement of the order by filing
a transcript of the record upon which the disobeyed
order was entered.
``(B) Notice.--Upon the receipt of the application
filed under subparagraph (A), the court shall notify
the participating lender or other person of such
enforcement action.
``(C) Procedure.--The evidence to be considered,
the procedure to be followed, and the jurisdiction of
the court shall be the same as is provided in paragraph
(5) for applications to set aside or modify orders.
``(h) Removal or Suspension of Management Officials.--
``(1) Removal of management officials.--
``(A) Notice of removal.--The Administrator may
serve upon any management official a written notice of
its intention to remove that management official if, in
the opinion of the Administrator such management
official--
``(i) has willfully and knowingly committed
any substantial violation of--
``(I) this Act;
``(II) any regulation issued under
this Act;
``(III) a cease-and-desist order
which has become final; or
``(IV) any agreement by the
management official or the
participating lender; or
``(ii) has willfully and knowingly
committed or engaged in any act, omission, or
practice which constitutes a substantial breach
of a fiduciary duty of that person as a
management official if the violation or breach
of fiduciary duty involves personal dishonesty
on the part of such management official.
``(B) Contents of notice.--A notice provided under
subparagraph (A) shall contain--
``(i) a statement of the facts constituting
the grounds for the removal of the management
official; and
``(ii) the time and place at which a
hearing will be held to determine if the
management official should be removed from
office.
``(C) Hearings.--
``(i) Timing.--A hearing described in
subparagraph (B) shall take place not earlier
than 30 days nor later than 60 days after the
date on which notice is provided under
subparagraph (A), unless an earlier or later
date is set by the Administrator at the request
of--
``(I) the management official, for
good cause shown; or
``(II) the Attorney General of the
United States.
``(ii) Consent.--If the management official
fails to appear, in person or by a duly
authorized representative, at a hearing under
this paragraph, that management official shall
be deemed to have consented to the issuance of
an order of removal under subparagraph (A).
``(D) Issuance of order of removal.--
``(i) In general.--The Administrator may
issue an order of removal from office if--
``(I) consent is deemed under
subparagraph (C)(ii); or
``(II) the Administrator finds,
upon the record of the hearing
described in this subsection, that any
of the grounds specified in the notice
of removal has been established.
``(ii) Effectiveness.--An order under
clause (i) shall--
``(I) become effective on the
expiration of the date which is 30 days
after the date that notice is provided
to the participating lender and the
management official concerned (except
in the case of an order issued upon
consent as described in subparagraph
(C)(ii), which shall become effective
at the time specified in such order);
and
``(II) remain effective and
enforceable, except to the extent it is
stayed, modified, terminated, or set
aside by action of the Administrator or
a reviewing court, in accordance with
this section.
``(2) Authority to suspend or prohibit participation.--
``(A) In general.--The Administrator may--
``(i) if necessary to protect the Small
Business Lending Company or interests of the
Administration, suspend from office any
management official described in paragraph (1),
or temporarily prohibit such official from
further participating in the management or
conduct of the affairs of the Small Business
Lending Company; and
``(ii) if necessary to protect the
interests of the Administration, suspend from
office any management official described in
paragraph (1) or prohibit from further
participation a non-federally regulated SBA
lender or any management official described in
paragraph (1) in any activities related to the
making, servicing, review, approval, or
liquidation of any loan made under section
7(a).
``(B) Effectiveness.--A suspension or prohibition
under subparagraph (A)--
``(i) shall become effective upon service
of notice under paragraph (1); and
``(ii) unless stayed by a court in
proceedings under subparagraph (C), shall
remain in effect--
``(I) pending the completion of the
administrative proceedings pursuant to
a notice under paragraph (1); and
``(II) until the Administrator
dismisses the charges specified in the
notice, or, if an order of removal or
prohibition is issued against the
management official, until the
effective date of any such order.
``(C) Judicial review.--Not later than 10 days
after any management official has been suspended from
office or prohibited from participation in the
management or conduct of the affairs of a participating
lender, the management official may apply for a stay of
the suspension or prohibition, pending the completion
of the administrative proceedings under this
subsection, to--
``(i) the United States district court for
the judicial district in which the home office
of the participating lender is located; or
``(ii) the United States District Court for
the District of Columbia.
``(3) Authority to suspend on criminal charges.--
``(A) In general.--If a management official is
charged, in any information, indictment, or complaint
authorized by a United States attorney or a State
prosecutor, with the commission of a felony involving
dishonesty or breach of trust, or has been convicted of
any felony, the Administrator may suspend that
management official from office or prohibit that
management official from further participation in the
management or conduct of the affairs of the
participating lender.
``(B) Effectiveness.--A suspension or prohibition
under paragraph (A) shall remain in effect until the
subject information, indictment, or complaint is
finally disposed of, or until terminated by the
Administrator.
``(C) Authority upon conviction.--
``(i) In general.--If a judgment of
conviction with respect to an offense described
in paragraph (A) is entered against a
management official and is no longer subject to
appellate review, the Administrator may issue
an order removing that management official from
office.
``(ii) Notice.--A copy of the order issued
under clause (i) shall be delivered to the
management official and the participating
lender for which such official was employed.
``(iii) Effective date.--The order of
removal under clause (i) shall take effect upon
the delivery of a copy of the order to the
participating lender.
``(D) Authority upon dismissal or other
disposition.--A finding of not guilty or other
disposition of charges described in subparagraph (A)
shall not preclude the Administrator from initiating
proceedings to suspend or remove the management
official from office, or to temporarily prohibit the
management official from participation in the
management or conduct of the affairs of any
participating lender.
``(4) Procedural provisions; judicial review.--
``(A) Hearing venue.--Any hearing under this
subsection shall be--
``(i) held in the Federal judicial district
or in the territory in which the principal
office of the participating lender is located,
unless the party afforded the hearing consents
to another place; and
``(ii) conducted in accordance with the
provisions of chapter 5 of title 5, United
States Code.
``(B) Issuance of orders.--After a hearing under
this subsection, and not later than 90 days after the
Administrator has notified the parties that the case
has been submitted for final decision, the
Administrator shall--
``(i) render a decision in the matter,
which shall include findings of fact upon which
its decision is predicated; and
``(ii) issue and serve upon each party to
the proceeding an order or orders consistent
with the provisions of this section.
``(C) Authority to modify orders.--The
Administrator may modify, terminate, or set aside any
order issued under this section--
``(i) at any time, upon such notice, and in
such manner as the Administrator may prescribe,
until a petition for review is timely filed
with a United States district court, in
accordance with subparagraph (D)(ii) and a
record of the proceeding has been filed in
accordance with subparagraph (D)(iii); and
``(ii) after the filing of the record under
subparagraph (D)(iii), with permission of the
court.
``(D) Judicial review.--
``(i) In general.--Judicial review of an
order issued under this section shall be
limited to the provisions of this subsection.
``(ii) Petition for judicial review.--Any
party to a hearing under this section may
obtain a review of any order issued pursuant to
subparagraph (B) (other than an order issued
with the consent of the management official
concerned or an order issued under subsection
(d)), by filing, not later than 30 days after
the date of service of such order, in the
United States district court for the judicial
district in which the principal office of the
licensee is located or in the United States
District Court for the District of Columbia, a
written petition requested that the order be
modified, terminated, or set aside.
``(iii) Notice to administration.--The
clerk of the court receiving a petition under
clause (ii) shall transmit a copy of the
petition to the Administrator, who shall submit
to the court the record of the proceeding, in
accordance with section 2112 of title 28,
United States Code.
``(iv) Jurisdiction.--
``(I) Exclusive.--Upon the filing
of the record under clause (iii), the
district court described in clause (ii)
shall have exclusive jurisdiction to
affirm, modify, terminate, or set
aside, in whole or in part, the order
of the Administrator, except as
provided under paragraph
(2)(B)(ii)(II).
``(II) Review.--The review of any
proceeding under subclause (I) shall be
in accordance with chapter 7 of title
5, United States Code.
``(v) Judicial review not a stay.--The
commencement of proceedings for judicial review
under this paragraph shall not, unless
specifically ordered by the district court,
operate as a stay of any order issued by the
Administrator under this section.
``(i) Injunctions.--
``(1) Application.--If, in the judgment of the
Administrator, a participating lender or any other person has
engaged, or is about to engage, in any acts or practices which
violate any provision of this Act, any rule or regulation under
this Act, or any order issued under this Act, the Administrator
may apply to the proper district court of the United States, or
a United States court of any place subject to the jurisdiction
of the United States, for an order to--
``(A) enjoin such acts or practices; or
``(B) enforce compliance with such provision, rule,
regulation, or order.
``(2) Jurisdiction.--A court under paragraph (1) shall have
jurisdiction over any action under paragraph (1).
``(3) Issuance.--Upon a showing by the Administrator that a
participating lender or other person has engaged, or is about
to engage, in any act or practice described in paragraph (1),
the court shall issue, without bond--
``(A) a permanent or temporary injunction;
``(B) a restraining order; or
``(C) any other appropriate order.
``(j) Appointment of Receivers.--In any injunction proceeding under
subsection (i), the district court may--
``(1) seize the assets of 1 or more Small Business Lending
Companies; and
``(2) appoint the Administration, or another receiver, to
hold or administer the assets seized under paragraph (1) under
the direction of the court.
``(k) Possession of Assets.--
``(1) Small business lending companies.--If a Small
Business Lending Company is insolvent, out of compliance with
capital requirements under this section, or otherwise operating
in an unsafe or unsound condition, the Administration may take
possession of--
``(A) the portfolio of loans guaranteed by the
Administration and sell such loans to a third party
through a receiver appointed under subsection (j)(2);
and
``(B) servicing activities of loans that are
guaranteed by the Administration and sell such
servicing rights to a third party through a receiver
appointed under subsection (j)(2).
``(2) Non-federally regulated sba lenders.--If a non-
federally regulated SBA lender is insolvent or otherwise
operating in an unsafe and unsound condition, the
Administration may take possession of--
``(A) the portfolio of loans guaranteed by the
Administration and sell such loans to a third party;
and
``(B) servicing activities of loans that are
guaranteed by the Administration and sell such
servicing rights to a third party.
``(l) Penalties and Forfeitures.--
``(1) In general.--Except as provided under paragraph (3),
a Small Business Lending Company or a non-federally regulated
SBA lender that violates any regulation or written directive
issued by the Administrator regarding the filing of any regular
or special report shall pay to the United States a civil
penalty of not more than $5,000 for every day after the due
date in which the lender fails to file such report, unless such
failure is due to reasonable cause and not willful neglect.
``(2) Recovery of civil penalty.--The civil penalty
provided for in this section shall accrue to the United States
and may be recovered in a civil action brought by the
Administration.
``(3) Exemption.--The Administrator may, by regulation,
order, or upon the application of an interested party, at any
time before a report is due under paragraph (1) and after
notice and opportunity for hearing, exempt, in whole or in
part, any Small Business Lending Company from the provisions of
paragraph (1), upon such terms and conditions and for such
period of time as the Administrator determines to be
appropriate, if the Administrator finds that such action is
consistent with the public interest or the protection of the
Administration.
``(4) Alternative requirements.--If an exemption is granted
under paragraph (3), the Administrator may, for the purposes of
this section, make any alternative requirements appropriate to
the situation.''.
SEC. 223. DEFINITIONS FOR SMALL BUSINESS LENDING COMPANIES AND NON-
FEDERALLY REGULATED SBA LENDERS.
Section 3 of the Small Business Act (15 U.S.C. 632) is amended--
(1) in subsection (l), by striking ``Act--
``(1) the term'' and inserting ``Act, the term''; and
(2) by adding at the end the following:
``(r) Small Business Lending Company.--In this Act, the term `Small
Business Lending Company' means a non-depository financial institution
that is licensed, supervised, examined, and regulated by the
Administration to only make loans under section 7.
``(s) Non-Federally Regulated SBA Lender.--In this Act, the term
`non-federally regulated SBA lender' means a financial institution,
other than a Small Business Lending Company, that makes loans under
section 7 and is not regulated by--
``(1) the Farm Credit Administration;
``(2) the Federal Financial Institution Examination
Council;
``(3) the Board of Governors of the Federal Reserve System;
``(4) the Office of the Comptroller of the Currency;
``(5) the Federal Deposit Insurance Corporation;
``(6) the Office of Thrift Supervision; or
``(7) the National Credit Union Administration.''.
Subtitle D--Disaster Assistance Loan Program
SEC. 231. CONFORMING AMENDMENT FOR DISASTER ASSISTANCE LOAN PROGRAM.
Section 7(c)(6) of the Small Business Act (15 U.S.C. 636(c)(6)) is
amended--
(1) by striking ``$500,000'' each place it appears and
inserting ``$1,500,000''; and
(2) by inserting ``commencing on or after April 1, 1993,''
before ``unless an applicant''.
SEC. 232. DISASTER RELIEF FOR SMALL BUSINESS CONCERNS DAMAGED BY
DROUGHT.
(a) Drought Disaster Authority.--
(1) Definition of disaster.--Section 3(k) of the Small
Business Act (15 U.S.C. 632(k)) is amended--
(A) by inserting ``(1)'' after ``(k)''; and
(B) by adding at the end the following:
``(2) For purposes of section 7(b)(2), the term `disaster'
includes--
``(A) drought; and
``(B) below average water levels in the Great Lakes, or on
any body of water in the United States that supports commerce
by small business concerns.''.
(2) Drought disaster relief authority.--Section 7(b)(2) of
the Small Business Act (15 U.S.C. 636(b)(2)) is amended--
(A) by inserting ``(including drought), with
respect to both farm-related and nonfarm-related small
business concerns,'' before ``if the Administration'';
and
(B) in subparagraph (B), by striking ``the
Consolidated Farmers Home Administration Act of 1961 (7
U.S.C. 1961)'' and inserting the following: ``section
321 of the Consolidated Farm and Rural Development Act
(7 U.S.C. 1961), in which case, assistance under this
paragraph may be provided to farm-related and nonfarm-
related small business concerns, subject to the other
applicable requirements of this paragraph''.
(b) Limitation on Loans.--From funds otherwise appropriated
pursuant to section 20 for loans under section 7(b) of the Small
Business Act (15 U.S.C. 636(b)), not more than $9,000,000 may be used
during fiscal year 2004 to provide drought disaster loans to nonfarm-
related small business concerns.
(c) Prompt Response to Disaster Requests.--Section 7(b)(2)(D) of
the Small Business Act (15 U.S.C. 636(b)(2)(D)) is amended by striking
``Upon receipt of such certification, the Administration may'' and
inserting ``Not later than 30 days after the date of receipt of such
certification by a Governor of a State, the Administration shall
respond in writing to that Governor on its determination and the
reasons therefore, and may''.
(d) Rulemaking.--Not later than 45 days after the date of enactment
of this section, the Administrator shall promulgate final rules to
carry out this section and the amendments made by this section.
SEC. 233. DISASTER MITIGATION PILOT PROGRAM.
Section 7(b)(1)(C) of the Small Business Act (15 U.S.C.
636(b)(1)(C)) is amended by striking ``2000 through 2004'' and
inserting ``2003 through 2006''.
Subtitle E--504 Loan Program
SEC. 241. EXTENSION OF USER FEES.
Section 503(f) of the Small Business Investment Act of 1958 (15
U.S.C. 697(f)) is amended by striking ``October 1, 2003'' and inserting
``October 1, 2006''.
SEC. 242. AMORTIZED LOAN LOSS RESERVE FUND.
Paragraph (6) of section 508(c) of the Small Business Investment
Act of 1958 (15 U.S.C. 697e(c)) is amended--
(1) by striking ``The Administration'' and inserting the
following:
``(A) In general.--The Administration''; and
(2) by adding at the end the following new subparagraph:
``(B) Temporary reduction based on outstanding
balance.--Notwithstanding subparagraph (A), the
Administration shall allow the certified development
company to withdraw from the loss reserve such amounts
as are in excess of 1 percent of the aggregate
outstanding balances of debentures to which such loss
reserve relates. The preceding sentence shall not apply
with respect to any debenture before 100 percent of the
contribution described in paragraph (4) with respect to
such debenture has been made.''.
SEC. 243. ALTERNATIVE LOSS RESERVE FOR CERTAIN PREMIER CERTIFIED
LENDERS.
(a) In General.--Subsection (c) of section 508 of the Small
Business Investment Act of 1958 (15 U.S.C. 697e) is amended by adding
at the end the following:
``(7) Alternative loss reserve.--
``(A) Election.--With respect to any eligible
calendar quarter, any qualified high loss reserve PCL
may elect to have the requirements of this paragraph
apply in lieu of the requirements of paragraphs (2) and
(4) for such quarter.
``(B) Contributions.--
``(i) Ordinary rules inapplicable.--Except
as provided under clause (ii) and paragraph
(5), a qualified high loss reserve PCL that
makes the election described in subparagraph
(A) with respect to a calendar quarter shall
not be required to make contributions to its
loss reserve during such quarter.
``(ii) Based on loss.--A qualified high
loss reserve PCL that makes the election
described in subparagraph (A) with respect to
any calendar quarter shall, before the last day
of such quarter, make such contributions to its
loss reserve as are necessary to ensure that
the amount of the loss reserve of the PCL is--
``(I) not less than $100,000; and
``(II) sufficient, as determined by
a qualified independent auditor, for
the PCL to meet its obligations to
protect the Federal Government from
risk of loss.
``(iii) Certification.--Before the end of
any calendar quarter for which an election is
in effect under subparagraph (A), the head of
the PCL shall submit to the Administrator a
certification that the loss reserve of the PCL
is sufficient to meet such PCL's obligation to
protect the Federal Government from risk of
loss. Such certification shall be in such form
and submitted in such manner as the
Administrator may require and shall be signed
by the head of such PCL and the auditor making
the determination under clause (ii)(II).
``(C) Disbursements.--
``(i) Ordinary rule inapplicable.--
Paragraph (6) shall not apply with respect to
any qualified high loss reserve PCL for any
calendar quarter for which an election is in
effect under subparagraph (A).
``(ii) Excess funds.--At the end of each
calendar quarter for which an election is in
effect under subparagraph (A), the
Administration shall allow the qualified high
loss reserve PCL to withdraw from its loss
reserve the excess of--
``(I) the amount of the loss
reserve, over
``(II) the greater of $100,000 or
the amount which is determined under
subparagraph (B)(ii) to be sufficient
to meet the PCL's obligation to protect
the Federal Government from risk of
loss.
``(D) Recontribution.--If the requirements of this
paragraph apply to a qualified high loss reserve PCL
for any calendar quarter and cease to apply to such PCL
for any subsequent calendar quarter, such PCL shall
make a contribution to its loss reserve in such amount
as the Administrator may determine provided that such
amount does not exceed the amount which would result in
the total amount in the loss reserve being equal to the
amount which would have been in such loss reserve had
this paragraph never applied to such PCL. The
Administrator may require that such payment be made as
a single payment or as a series of payments.
``(E) Risk management.--If a qualified high loss
reserve PCL fails to meet the requirement of
subparagraph (F)(iii) during any period for which an
election is in effect under subparagraph (A) and such
failure continues for 180 days, the requirements of
paragraphs (2), (4), and (6) shall apply to such PCL as
of the end of such 180-day period and such PCL shall
make the contribution to its loss reserve described in
subparagraph (D). The Administrator may waive the
requirements of this subparagraph.
``(F) Qualified high loss reserve pcl.--The term
`qualified high loss reserve PCL' means, with respect
to any calendar year, any premier certified lender
designated by the Administrator as a qualified high
loss reserve PCL for such year. The Administrator shall
not designate a company under the preceding sentence
unless the Administrator determines that--
``(i) the amount of the loss reserve of the
company is not less than $100,000;
``(ii) the company has established and is
utilizing an appropriate and effective process
for analyzing the risk of loss associated with
its portfolio of PCLP loans and for grading
each PCLP loan made by the company on the basis
of the risk of loss associated with such loan;
and
``(iii) the company meets or exceeds 4 or
more of the specified risk management
benchmarks as of the most recent assessment by
the Administration or the Administration has
issued a waiver with respect to the requirement
of this clause.
``(G) Specified risk management benchmarks.--For
purposes of this paragraph, the term `specified risk
management benchmarks' means the following rates, as
determined by the Administrator:
``(i) Currency rate.
``(ii) Delinquency rate.
``(iii) Default rate.
``(iv) Liquidation rate.
``(v) Loss rate.
``(H) Qualified independent auditor.--For purposes
of this paragraph, the term `qualified independent
auditor' means any licensed auditor who--
``(i) is compensated by the qualified high
loss reserve PCL;
``(ii) is independent of such PCL; and
``(iii) has been approved by the
Administrator during the preceding year.
``(I) PCLP loan.--For purposes of this paragraph,
the term `PCLP loan' means any loan guaranteed under
this section.
``(J) Eligible calendar quarter.--For purposes of
this paragraph, the term `eligible calendar quarter'
means--
``(i) the first calendar quarter that
begins after the end of the 90-day period
beginning with the date of the enactment of
this paragraph; and
``(ii) the 11 succeeding calendar quarters.
``(K) Calendar quarter.--For purposes of this
paragraph, the term `calendar quarter' means--
``(i) the period which begins on January 1
and ends on March 31 of each year;
``(ii) the period which begins on April 1
and ends on June 30 of each year;
``(iii) the period which begins on July 1
and ends on September 30 of each year; and
``(iv) the period which begins on October 1
and ends on December 31 of each year.
``(L) Regulations.--Not later than 45 days after
the date of the enactment of this paragraph, the
Administrator shall publish in the Federal Register and
transmit to Congress regulations to carry out this
paragraph. Such regulations shall include provisions
relating to--
``(i) the approval of auditors under
subparagraph (H); and
``(ii) the designation of qualified high
loss reserve PCLs under subparagraph (F),
including the determination of whether a
process for analyzing risk of loss is
appropriate and effective for purposes of
subparagraph (F)(ii).''.
(b) Increased Reimbursement for Losses Related to Debentures Issued
During Election Period.--Subparagraph (C) of section 508(b)(2) of the
Small Business Investment Act of 1958 (15 U.S.C. 697e(b)(2)) is amended
by inserting ``(15 percent in the case of any such loss attributable to
a debenture issued by the company during any period for which an
election is in effect under subsection (c)(7) for such company)''
before ``; and''.
(c) Conforming Amendments.--
(1) Subparagraph (D) of section 508(b)(2) of the Small
Business Investment Act of 1958 (15 U.S.C. 697e(b)(2)) is
amended by striking ``subsection (c)(2)'' and inserting
``subsection (c)''.
(2) Paragraph (5) of section 508(c) of the Small Business
Investment Act of 1958 (15 U.S.C. 697e(c)) is amended by
striking ``10 percent''.
(d) Study and Report.--
(1) In general.--The Administrator shall enter into a
contract with a Federal agency experienced in community
development lending and financial regulation or with a member
of the Federal Financial Institutions Examinations Council to
study and prepare a report regarding--
(A) the extent to which statutory requirements have
caused over capitalization in the loss reserves
maintained by certified development companies
participating in the Premier Certified Lenders Program
established under section 508 of the Small Business
Investment Act of 1958 (15 U.S.C. 697e); and
(B) alternatives for establishing and maintaining
loss reserves that are sufficient to protect the
Federal Government from the risk of loss associated
with loans guaranteed under such Program.
(2) Transmission of report.--The report described in
paragraph (1) shall be transmitted to the Committee on Small
Business of the House of Representatives and the Committee on
Small Business and Entrepreneurship of the Senate not later
than 180 days after the date of the enactment of this Act.
(3) Limitation.--The amount of the contract described in
paragraph (1) shall not exceed $75,000.
SEC. 244. DEBENTURE SIZE.
Section 502(2) of the Small Business Investment Act of 1958 (15
U.S.C. 696) is amended to read as follows:
``(2) Maximum amount.--Loans made by the Administration
under this section shall be limited to--
``(A) $1,500,000 for each small business concern if
the loan proceeds will not be directed toward a goal or
project described in subparagraph (B) or (C);
``(B) $2,000,000 for each small business concern if
the loan proceeds will be directed toward 1 or more of
the public policy goals described under section
501(d)(3); and
``(C) $4,000,000 for each small business concern if
the loan proceeds will be directed toward manufacturing
projects.''.
SEC. 245. JOB CREATION OR RETENTION STANDARDS.
Section 501 of the Small Business Investment Act of 1958 (15 U.S.C.
695) is amended by striking the undesignated paragraph at the end and
inserting the following:
``(e) Job Creation or Retention.--
``(1) In general.--A project being funded by the debenture
is deemed to satisfy the job creation or retention requirement
under subsection (d)(1) if the project creates or retains--
``(A) 1 job opportunity for every $50,000
guaranteed by the Administration; or
``(B) in the case of a manufacturing project, 1 job
opportunity for every $100,000 guaranteed by the
Administration.
``(2) Temporary job creation waiver.--
``(A) In general.--If a development company fails
to meet the job creation and retention requirements
under this section, the company may apply for a
temporary waiver from the Administration. Not later
than 30 days after the request for such waiver, the
Administration shall respond to the request and may
temporarily waive the requirement if the development
company shows reasonable cause for its failure to meet
the job creation and retention requirements under this
section and demonstrates how it intends to attain such
requirements in the future.
``(B) Aggregation of goals and objectives.--If a
project meets the economic development objectives or
public policy goals under paragraphs (2) and (3) of
subsection (d), the project does not need to meet the
individual job creation or retention requirements for
that particular project if the outstanding portfolio of
the development company meets or exceeds the job
creation or retention criteria under subsection
(d)(1).''.
SEC. 246. SIMPLIFIED APPLICATIONS.
(a) Loans of $400,000 or Less.--
(1) In general.--Not later than 180 days after the date of
enactment of this Act, the Administrator shall develop a
shorter, more concise, and simplified application form for loan
guarantees involving not more than $400,000 authorized under
section 504 of the Small Business Investment Act of 1958 (15
U.S.C. 697a).
(2) Availability to certified development companies.--The
form developed under paragraph (1) shall be made available to
certified development companies not later than 180 days after
the date of enactment of this Act.
(b) All Other Loans.--
(1) In general.--Not later than 270 days after the date of
enactment of this Act, the Administrator shall develop a
shorter, more concise, and simplified application form for all
loan guarantees authorized under section 504 of the Small
Business Investment Act of 1958 (15 U.S.C. 697a), including
those described in subsection (a).
(2) Availability to certified development companies.--The
form developed under paragraph (1) shall be made available to
certified development companies not later than 270 days after
the date of enactment of this Act.
SEC. 247. CHILD CARE LENDING PILOT PROGRAM.
(a) Loans Authorized.--Section 502 of the Small Business Investment
Act of 1958 (15 U.S.C. 696) is amended--
(1) in the matter preceding paragraph (1)--
(A) by striking ``The Administration'' and
inserting the following:
``(a) Authorization.--The Administration'';
(B) by striking ``and such loans'' and inserting
``. Such loans'';
(C) by striking ``: Provided, however, That the
foregoing powers shall be subject to the following
restrictions and limitations:'' and inserting a period;
and
(D) by adding at the end the following:
``(b) Restrictions and Limitations.--The authority under subsection
(a) shall be subject to the following restrictions and limitations:'';
and
(2) in paragraph (1)--
(A) by inserting after ``Use of proceeds.--'' the
following:
``(A) In general.--''; and
(B) by adding at the end the following:
``(B) Loans to small, nonprofit child care
businesses.--
``(i) In general.--Notwithstanding
subsection (a)(1), the proceeds of any loan
described in subsection (a) may be used by the
certified development company to assist small,
nonprofit child care businesses, provided
that--
``(I) the loan will be used for a
sound business purpose that has been
approved by the Administration;
``(II) each such business receiving
financial assistance meets all of the
same eligibility requirements
applicable to for-profit businesses
under this title, except for status as
a for-profit business;
``(III) 1 or more individuals has
personally guaranteed the loan;
``(IV) the small, non-profit child
care business has clear and singular
title to the collateral for the loan;
and
``(V) the small, non-profit child
care business has sufficient cash flow
from its operations to meet its
obligations on the loan and its normal
and reasonable operating expenses.
``(ii) Limitation on volume.--Not more than
7 percent of the total number of loans
guaranteed in any fiscal year under this title
may be awarded under the pilot program.
``(iii) Defined term.--For purposes of this
subparagraph, the term `small, non-profit child
care business' means an establishment that--
``(I) is organized in accordance
with section 501(c)(3) of the Internal
Revenue Code of 1986;
``(II) is primarily engaged in
providing child care for infants,
toddlers, pre-school, or pre-
kindergarten children (or any
combination thereof), may provide care
for older children when they are not in
school, and may offer pre-kindergarten
educational programs;
``(III) including its affiliates,
has tangible net worth that does not
exceed $7,000,000, and has average net
income (excluding any carryover losses)
for the preceding 2 completed fiscal
years that does not exceed $2,500,000;
and
``(IV) is licensed as a child care
provider by the District of Columbia,
the insular area, or the State in which
it is located.''.
``(iv) Sunset provision.--This subparagraph
shall remain in effect until September 30,
2006, and shall apply to all loans authorized
under this subparagraph that are applied for,
approved, or disbursed during the period
beginning on the date of enactment of the Small
Business Administration 50th Anniversary
Reauthorization Act of 2003 and ending on
September 30, 2006.''.
(b) Reports.--
(1) Small business administration.--
(A) In general.--Not later than 6 months after the
date of enactment of this Act, and every 6 months
thereafter until September 30, 2006, the Administrator
shall submit a report on the implementation of the
program under subsection (a) to--
(i) the Committee on Small Business and
Entrepreneurship of the Senate; and
(ii) the Committee on Small Business of the
House of Representatives.
(B) Contents.--The report under subparagraph (A)
shall contain--
(i) the date on which the program is
implemented;
(ii) the date on which the rules are issued
pursuant to subsection (c); and
(iii) the number and dollar amount of loans
under the program applied for, approved, and
disbursed during the previous 6 months--
(I) with respect to nonprofit child
care business; and
(II) with respect to for profit
child care business.
(2) General accounting office.--
(A) In general.--Not later than March 31, 2006, the
Comptroller General of the United States shall submit a
report on the child care small business loans
authorized by section 502(b)(1)(B) of the Small
Business Investment Act of 1958, as added by this Act,
to--
(i) the Committee on Small Business and
Entrepreneurship of the Senate; and
(ii) the Committee on Small Business of the
House of Representatives.
(B) Contents.--The report under subparagraph (A)
shall contain information gathered during the first 2
years of the loan program, including--
(i) an evaluation of the timeliness of the
implementation of the loan program;
(ii) a description of the effectiveness and
ease with which certified development
companies, lenders, and small businesses have
participated in the loan program;
(iii) a description and assessment of how
the loan program was marketed;
(iv) by location (State, insular area, and
District of Columbia) and in total, the number
of child care small businesses, categorized by
status as a for-profit or non-profit business,
that--
(I) applied for loans under the
program (and whether it was a new or
expanding child care provider);
(II) were approved for loans under
the program; and
(III) received loan disbursements
under the program (and whether they are
a new or expanding child care
provider); and
(v) with respect to the businesses
described under clause (iv)(III)--
(I) the number of such businesses
in each State, insular area, and
District of Columbia, as of the year of
enactment of this Act;
(II) the total amount loaned to
such businesses under the program;
(III) the total number of loans to
such businesses under the program;
(IV) the average loan amount and
term;
(V) the currency rate,
delinquencies, defaults, and losses of
the loans;
(VI) the number and percent of
children served who receive subsidized
assistance; and
(VII) the number and percent of
children served who are low income.
(C) Access to information.--
(i) In general.--The Administration shall
collect and maintain such information as may be
necessary to carry out this paragraph from
certified development centers and child care
providers, and such centers and providers shall
comply with a request for information from the
Administration for that purpose.
(ii) Provision of information to gao.--The
Administration shall provide information
collected under this subparagraph to the
Comptroller General of the United States for
purposes of the report required by this
paragraph.
(c) Rulemaking Authority.--Not later than 120 days after the date
of enactment of this Act, the Administrator shall issue final rules to
carry out the loan program authorized by section 502(b)(1)(B) of the
Small Business Investment Act of 1958, as added by this Act.
SEC. 248. DEFINITION OF RURAL AREA.
Section 501 of the Small Business Investment Act of 1958 (15 U.S.C.
695) is amended by adding at the end the following:
``(f) Definition of Rural Area.--For purposes of this title, the
term `rural area' means any area other than--
``(1) a city or town with a population of not less than
50,000 inhabitants; or
``(2) the urbanized area adjacent to a city or town under
subparagraph (A).''.
Subtitle F--Surety Bond Program
SEC. 251. CLARIFICATION OF MAXIMUM SURETY BOND GUARANTEE.
(a) In General.--Section 411(a)(1) of the Small Business Investment
Act of 1958 (15 U.S.C. 694b(a)(1)) is amended by striking ``contract up
to'' and inserting ``total work order or contract amount at the time of
bond execution that does not exceed''.
SEC. 252. AUTHORIZATION OF PREFERRED SURETY BOND GUARANTEE PROGRAM.
Section 411(a) of the Small Business Investment Act of 1958 (15
U.S.C. 694b(a)) is amended by adding at the end the following: ``This
paragraph shall remain in effect through September 30, 2006.''.
Subtitle G--Miscellaneous
SEC. 261. COORDINATION OF SBA LOANS.
Section 7(a)(3) of the Small Business Act (15 U.S.C. 636(a)(3)) is
amended--
(1) by inserting ``Total amount of
loans.--'' before ``No loan''; and
(2) by amending subparagraph (A) to read as follows:
``(A) if the total amount outstanding and committed
(by participation or otherwise) to the borrower under
section 7(a) would exceed $1,000,000 (or if the gross
loan amount would exceed $2,000,000), except as
provided in subparagraph (B), plus an amount not to
exceed the maximum amount of a development company
financing under title V of the Small Business
Investment Act of 1958 (15 U.S.C. 695 et seq.), and the
Administration shall report to Congress in its annual
budget request and performance plan on the number of
small business concerns that have financings under both
section 7(a) and under title V of the Small Business
Investment Act of 1958, and the total amount and
general performance of such financings;''.
SEC. 262. LEASING OPTIONS FOR 7(A) AND 504 BORROWERS.
(a) 7(a) Loans.--Section 7(a)(28) of the Small Business Act (15
U.S.C. 636(a)(28)) is amended to read as follows:
``(28) Leasing.--In addition to such other lease
arrangements as may be authorized by the Administration, a
borrower under this section may lease, permanently or for a
short term, to 1 or more tenants, not more than 40 percent of
any property purchased or constructed as part of a project
financed under this section if the borrower permanently
occupies and uses not less than 60 percent of the total
business space of the property.''.
(b) 504 Loans.--Subsection (b)(5) of section 502 of the Small
Business Investment Act of 1958 (15 U.S.C. 696), as redesignated by
this Act, is amended to read as follows:
``(5) Leasing.--In addition to such other lease
arrangements as may be authorized by the Administration, a
borrower under this title may lease, permanently or for a short
term, to 1 or more tenants, not more than 40 percent of any
property purchased or constructed as part of a project financed
under this title if the borrower permanently occupies and uses
not less than 60 percent of the total business space of the
property.''.
SEC. 263. CALCULATION OF FINANCING LIMITATION FOR SMALL BUSINESS
INVESTMENT COMPANIES.
Section 306 of the Small Business Investment Act of 1958 (15 U.S.C.
686) is amended by inserting after subsection (a) the following:
``(b) In calculating the 20 percent limitation under subsection (a)
or any guarantee required of a small business investment company by the
Administration, only 50 percent of the value of any loans issued under
either section 7(a) of the Small Business Act or title V of this Act,
which are received by the enterprise in which the small business
investment company has issued commitments, shall be taken into
consideration, but for any 1 such enterprise, a small business
investment company may not simultaneously take advantage of this
discounted calculation for loans under both section 7(a) of the Small
Business Act (15 U.S.C. 636(a)) and title V of this Act.''.
SEC. 264. ESTABLISHING ALTERNATIVE SIZE STANDARD.
Section 3(a)(3) of the Small Business Act (15 U.S.C. 632(a)(3) is
amended--
(1) by striking ``When establishing'' and inserting the
following: ``Establishment of Size Standards.--
``(A) In general.--When establishing''; and
(2) by adding at the end the following:
``(B) Alternative size standard.--The Administrator shall
establish an alternative size standard pursuant to paragraph
(2), which--
``(i) shall be applicable to loan applicants under
section 7(a) of this Act or title V of the Small
Business Investment Act of 1958 (15 U.S.C. 695 et
seq.); and
``(ii) shall utilize the maximum net worth and
maximum net income of the prospective borrower as an
alternative to the use of industry standards.''.
Subtitle H--New Markets Venture Capital
SEC. 271. TIME FRAME FOR RAISING PRIVATE CAPITAL.
Section 354(d) of the Small Business Investment Act of 1958 (15
U.S.C. 689c(d)) is amended--
(1) by redesignating paragraphs (1) and (2) as paragraphs
(2) and (3), respectively; and
(2) by striking ``The Administrator shall'' and all that
follows through ``following requirements:'' and inserting the
following:
``(1) In general.--The Administrator shall give each
conditionally approved company 2 years to satisfy the
requirements under this subsection. If a conditionally approved
company meets these requirements before the end of such 2-year
period, the Administrator shall proceed to final approval
according to the requirements under subsection (e).''.
SEC. 272. DEFINITION OF LOW-INCOME GEOGRAPHIC AREA.
Section 351(3)(A)(ii) of the Small Business Investment Act of 1958
(15 U.S.C. 689(3)(A)(ii)) is amended--
(1) in subclause (I), by striking ``50 percent or more''
and all that follows and inserting ``the median family income
for such tract does not exceed 80 percent of the greater of the
statewide median family income or metropolitan area median
family income; or''; and
(2) in subclause (II), by striking ``household income''
each place it appears and inserting ``family income''.
Subtitle I--Small Business Investment Company Program
SEC. 281. INVESTMENT OF EXCESS FUNDS.
Section 308(b) of the Small Business Investment Act of 1958 (15
U.S.C. 687(b)) is amended by striking the last sentence and inserting
the following: ``Such companies with outstanding financings are
authorized to invest funds not reasonably needed for their operations
in--
``(1) direct obligations of, or obligations guaranteed as
to principal and interest by, the United States;
``(2) in certificates of deposit maturing within 1 year
after issuance by any institution, whose accounts are federally
insured, or in savings accounts of such institution; or
``(3) in such other investment securities, mutual funds, or
instruments that solely consist of, invest in, or are supported
by the instruments described in paragraphs (1) and (2).''.
SEC. 282. MAXIMUM PRIORITIZED PAYMENT RATE.
Section 303(g) of the Small Business Investment Act of 1958 (15
U.S.C. 683(g)) is amended--
(1) in the matter preceding paragraph (1), by striking ``In
order'' and inserting ``Guarantees of Participating
Securities.--In order''; and
(2) in paragraph (2), by striking ``1.38 percent'' and
inserting ``1.7 percent''.
SEC. 283. IMPROVED DISTRIBUTION REQUIREMENTS.
Section 303(g)(9) of the Small Business Investment Act of 1958 (15
U.S.C. 683(g)(9)) is amended to read as follows:
``(9) After making any distribution pursuant to paragraph
(8), a company with participating securities outstanding may
distribute the balance of income to its investors if--
``(A) there are no accumulated and unpaid
prioritized payments;
``(B) any amounts received by the Administration
under this paragraph and paragraph (8) are first
applied as prepayment of the principal amount of the
outstanding participating securities or debentures of
the company at the time of such distribution and then
applied to the profit participation under paragraph
(11); and
``(C) any distributions under this paragraph are
made to private investors and to the Administration in
the ratio of private capital to leverage as of the date
immediately preceding the distribution until the
outstanding participating securities or debentures of
the company have been paid in full, after which any
remaining distributions under this paragraph are made
to private investors and to the Administration in the
ratio provided for the distribution of profits under
paragraph (11).''.
Subtitle J--Small Business Intermediary Lending Pilot Program
SEC. 291. SHORT TITLE.
This subtitle may be cited as the ``Small Business Intermediary
Lending Pilot Program Act of 2003''.
SEC. 292. FINDINGS.
Congress finds the following:
(1) Small and emerging businesses, particularly startups
and businesses that lack sufficient or conventional collateral,
continue to face barriers accessing mid-sized loans in amounts
between $35,000 and $200,000, with affordable terms and
conditions.
(2) Consolidation in the banking industry has resulted in a
decrease in the number of small, locally controlled banks with
not more than $100,000,000 in assets and has changed the method
by which banks make small business credit decisions with--
(A) credit scoring techniques replacing
relationship-based lending, which often works to the
disadvantage of small or startup businesses that do not
conform with a bank's standardized credit formulas; and
(B) less flexible terms and conditions, which are
often necessary for small and emerging businesses.
(3) In the environment described in paragraphs (1) and (2),
non-profit intermediary lenders, including community
development corporations, providing financial resources that
serve to supplement the small business lending and investments
of a bank by--
(A) providing riskier, up front, or subordinated
capital;
(B) offering flexible terms and underwriting
procedures; and
(C) providing technical assistance to businesses in
order to reduce the transaction costs and risk exposure
of banks.
(4) Several Federal programs, including the Microloan
Program under section 7(m) of the Small Business Act (15 U.S.C.
636(m)) and the Intermediary Relending Program of the
Department of Agriculture, have demonstrated the effectiveness
of working through non-profit intermediaries to address the
needs of small business concerns that are unable to access
capital through conventional sources.
(5) More than 1,000 non-profit intermediary lenders in the
United States are--
(A) successfully providing financial and technical
assistance to small and emerging businesses;
(B) working with banks and other lenders to
leverage additional capital for their business
borrowers; and
(C) creating employment opportunities for low
income individuals through their lending and business
development activities.
SEC. 293. SMALL BUSINESS INTERMEDIARY LENDING PILOT PROGRAM.
(a) In General.--Section 7(l) of the Small Business Act (15 U.S.C.
636(l)) is amended to read as follows:
``(l) Small Business Intermediary Lending Program.--
``(1) Definitions.--For purposes of this subsection--
``(A) the term `intermediary' means an entity that
seeks to borrow, or has borrowed, funds from the
Administration to make mid-size loans to small business
concerns under this subsection that is a private,
nonprofit entity, including--
``(i) a private, nonprofit community
development corporation;
``(ii) a consortium of private, nonprofit
organizations or nonprofit community
development corporations;
``(iii) a quasi-governmental economic
development entity (such as a planning and
development district), other than a State,
county, or municipal government; and
``(v) an agency of or nonprofit entity
established by a Native American Tribal
Government; and
``(B) the term `mid-size loan' means a fixed rate
loan of not less than $35,000 and not more than
$200,000, made by an intermediary to a startup, newly
established, or growing small business concern.
``(2) Establishment.--There is established a 3-year small
business intermediary lending pilot program (referred to in
this section as the ``Program''), under which the
Administration may make direct loans to eligible
intermediaries, for the purpose of making fixed interest rate
mid-size loans to startup, newly established, and growing small
business concerns.
``(3) Purposes.--The purposes of the small business
intermediary lender pilot program are--
``(A) to assist small business concerns in those
areas suffering from a lack of credit due to poor
economic conditions;
``(B) to create employment opportunities for low-
income individuals;
``(C) to establish a mid-size loan program to be
administered by the Small Business Administration to
make loans to eligible intermediaries to enable such
intermediaries to provide small-scale loans,
particularly loans in amounts averaging not more than
$150,000, to startup, newly established, or growing
small business concerns for working capital or the
acquisition of materials, supplies, or equipment;
``(D) to test the effectiveness of non-profit
intermediaries--
``(i) as a delivery system for a mid-size
loan program; and
``(ii) in addressing the credit needs of
small businesses and leveraging other sources
of credit; and
``(E) to determine the advisability and feasibility
of implementing a mid-size loan program nationwide.
``(4) Eligibility for participation.--An intermediary shall
be eligible to receive loans if the intermediary has at least 1
year of experience making loans to startup, newly established,
or growing small business concerns.
``(5) Loans to intermediaries.--
``(A) Application.--Each intermediary desiring a
loan under this subsection shall submit an application
to the Administration, which describes--
``(i) the type of small business concerns
to be assisted;
``(ii) the size and range of loans to be
made;
``(iii) the geographic area to be served
and its economic, poverty, and unemployment
characteristics;
``(iv) the status of small business
concerns in the area to be served and an
analysis of the availability of credit; and
``(v) the qualifications of the applicant
to carry out the purpose of this subsection.
``(B) Loan limits.--Notwithstanding subsection
(a)(3), no loan may be made under this subsection if
the total amount outstanding and committed to an
intermediary from the business loan and investment fund
established by this Act would, as a result of such
loan, exceed $1,000,000 during the participation of the
intermediary in the Program.
``(C) Loan duration.--Loans made by the
Administration under this subsection shall be for a
maximum term of 20 years.
``(D) Applicable interest rates.--Loans made by the
Administration to an intermediary under the Program
shall bear an annual interest rate equal to 1.00
percent.
``(E) Fees; collateral.--The Administration may not
charge any fees or require collateral with respect to
any loan made to an intermediary under this subsection.
``(F) Leverage.--Any loan to a small business
concern shall not exceed 75 percent of the total cost
of the project, with the remaining funds being
leveraged from other sources, including--
``(i) banks or credit unions;
``(ii) community development financial
institutions; and
``(iii) other sources with funds available
to the intermediary lender.
``(G) Delayed payments.--The Administration shall
not require the repayment of principal or interest on a
loan made to an intermediary under this section during
the first 2 years of the loan.
``(6) Program funding for mid-size loans.--
``(A) Number of participants.--Under the Program,
the Administration may provide loans, on a competitive
basis, to not more than 20 intermediaries.
``(B) Equitable distribution of intermediaries.--
The Administration shall select and provide funding
under the Program to such intermediaries as will ensure
geographic diversity and representation of urban and
rural communities.
``(7) Report to congress.--
``(A) Initial report.--Not later than 30 months
after the date of enactment of the Small Business
Administration 50th Anniversary Reauthorization Act of
2003, the Administration shall submit a report
containing an evaluation of the effectiveness of the
Program to--
``(i) the Committee on Small Business and
Entrepreneurship of the Senate; and
``(ii) the Committee on Small Business of
the House of Representatives.
``(B) Annual report.--Not later than 12 months
after the date of enactment of the Small Business
Administration 50th Anniversary Reauthorization Act of
2003, and each year thereafter, the Administration
shall submit an annual report containing an evaluation
of the effectiveness of the Program to the Committees
described in subparagraph (A).
``(C) Contents.--The reports submitted under
subparagraphs (A) and (B) shall include--
``(i) the numbers and locations of the
intermediaries receiving funds to provide mid-
size loans;
``(ii) the amounts of each loan to an
intermediary;
``(iii) the numbers and amounts of mid-size
loans made by intermediaries to small business
concerns;
``(iv) the repayment history of each
intermediary;
``(v) a description of the loan portfolio
of each intermediary, including the extent to
which it provides mid-size loans to small
business concerns in rural and economically
depressed areas;
``(vi) an estimate of the number of low-
income individuals who have been employed as a
direct result of the Program; and
``(vii) any recommendations for legislative
changes that would improve the operation of the
Program.''.
(b) Rulemaking Authority.--Not later than 180 days after the date
of enactment of this Act, the Administrator shall issue regulations to
carry out the amendment made by subsection (a).
(c) Authorization of Appropriations.--
(1) In general.--There are authorized to be appropriated
such sums as may be necessary for each of the fiscal years 2004
through 2006 to provide $20,000,000 in loans under section 7(l)
of the Small Business Act, as amended by subsection (a).
(2) Availability.--Any amounts appropriated pursuant to
paragraph (1) shall remain available until expended.
TITLE III--ENTREPRENEURIAL DEVELOPMENT PROGRAMS
Subtitle A--Office of Entrepreneurial Development
SEC. 301. SERVICE CORPS OF RETIRED EXECUTIVES.
(a) In General.--Section 8(b)(1)(B) of the Small Business Act (15
U.S.C. 637(b)(1)(B)) is amended--
(1) by striking ``this Act; and to'', and inserting ``this
Act. To'';
(2) by striking ``may maintain at its headquarters'' and
all that follows through ``That any'' and inserting ``shall
maintain at its headquarters and pay the salaries, benefits,
and expenses of a volunteer and professional staff to manage
and oversee the program. Any''; and
(3) by striking the period at the end and inserting the
following: ``and the management of the contributions
received.''.
(b) Regulations.--The Administration shall, not later than 180 days
after the date of enactment of this Act, promulgate regulations to
carry out the amendments made by subsection (a).
(c) Extension of Cosponsorship Authority.--Section 401(a)(2) of the
Small Business Administration Reauthorization and Amendments Act of
1994 (15 U.S.C. 637 note, 108 Stat. 4190) is amended by striking
``September 30, 2003'' and inserting ``September 30, 2006''.
SEC. 302. SMALL BUSINESS DEVELOPMENT CENTER PROGRAM.
(a) Term Change.--Section 21(k) of the Small Business Act (15
U.S.C. 648(k)) is amended--
(1) by striking ``Certification'' each place it appears and
inserting ``Accreditation''; and
(2) by striking ``certification'' each place it appears and
inserting ``accreditation''.
(b) Privacy Requirements.--Section 21(a) of the Small Business Act
is amended by adding at the end the following:
``(7) Privacy requirements.--
``(A) In general.--A small business development
center, consortium of small business development
centers, or contractor or agent of a small business
development center may not disclose the name, address,
or telephone number of any individual or small business
concern receiving assistance under this section without
the consent of such individual or small business
concern, unless--
``(i) the Administrator is ordered to make
such a disclosure by a court in any civil or
criminal enforcement action initiated by a
Federal or State agency; or
``(ii) the Administrator considers such a
disclosure to be necessary for the purpose of
conducting a financial audit of a small
business development center, but a disclosure
under this clause shall be limited to the
information necessary for such audit.
``(B) Administration use of information.--This
section shall not--
``(i) restrict Administration access to
program activity data; or
``(ii) prevent the Administration from
using client information (other than the
information described in subparagraph (A)) to
conduct client surveys.
``(C) Regulations.--The Administrator shall issue
regulations to establish standards for requiring
disclosures during a financial audit under subparagraph
(A)(ii).''.
(c) Conforming Amendment.--Section 20(a)(1) of the Small Business
Act (15 U.S.C. 631 note) is amended by striking ``certification'' each
place it appears and inserting ``accreditation''.
SEC. 303. PRIME REAUTHORIZATION AND TRANSFER TO THE SMALL BUSINESS ACT.
(a) Program Reauthorization.--Subtitle C of title I of the Riegle
Community Development and Regulatory Improvement Act of 1994 (15 U.S.C.
6901 note) is amended to read as follows:
``SEC. 37. PROGRAM FOR INVESTMENT IN MICROENTREPRENEURS.
``(a) Definitions.--For purposes of this section, the following
definitions shall apply:
``(1) Administration.--The term `Administration' means the
Small Business Administration.
``(2) Administrator.--The term `Administrator' means the
Administrator of the Small Business Administration.
``(3) Capacity building services.--The term `capacity
building services' means services provided to an organization
that is, or that is in the process of becoming, a
microenterprise development organization or program, for the
purpose of enhancing its ability to provide training and
services to disadvantaged entrepreneurs.
``(4) Collaborative.--The term `collaborative' means 2 or
more nonprofit entities that agree to act jointly as a
qualified organization under this section.
``(5) Disadvantaged entrepreneur.--The term `disadvantaged
entrepreneur' means a microentrepreneur that--
``(A) is a low-income person;
``(B) is a very low-income person; or
``(C) lacks adequate access to capital or other
resources essential for business success, or is
economically disadvantaged, as determined by the
Administrator.
``(6) Disadvantaged native american entrepreneur.--The term
`disadvantaged Native American entrepreneur' means a
disadvantaged entrepreneur who is also a member of an Indian
Tribe.
``(7) Indian tribe.--The term `Indian tribe' has the same
meaning as in section 4(a) of the Indian Self-Determination and
Education Assistance Act.
``(8) Intermediary.--The term `intermediary' means a
private, nonprofit entity that seeks to serve microenterprise
development organizations and programs, as authorized under
subsection (d).
``(9) Low-income person.--The term `low-income person'
means having an income, adjusted for family size, of not more
than--
``(A) for metropolitan areas, 80 percent of the
area median income; and
``(B) for nonmetropolitan areas, the greater of--
``(i) 80 percent of the area median income;
or
``(ii) 80 percent of the statewide
nonmetropolitan area median income.
``(10) Microentrepreneur.--The term `microentrepreneur'
means the owner or developer of a microenterprise.
``(11) Microenterprise.--The term `microenterprise' means a
sole proprietorship, partnership, or corporation that--
``(A) has fewer than 5 employees; and
``(B) generally lacks access to conventional loans,
equity, or other banking services.
``(12) Microenterprise development organization or
program.--The term `microenterprise development organization or
program' means a nonprofit entity, or a program administered by
such an entity, including community development corporations or
other nonprofit development organizations and social service
organizations, that provides services to disadvantaged
entrepreneurs.
``(13) Training and technical assistance.--The term
`training and technical assistance' means services and support
provided to disadvantaged entrepreneurs, such as assistance for
the purpose of enhancing business planning, marketing,
management, financial management skills, and assistance for the
purpose of accessing financial services.
``(14) Very low-income person.--The term `very low-income
person' means having an income, adjusted for family size, of
not more than 150 percent of the poverty line (as defined in
section 673(2) of the Community Services Block Grant Act (42
U.S.C. 9902(2)), including any revision required by that
section).
``(b) Establishment of Program.--The Administrator shall establish
a microenterprise technical assistance and capacity building grant
program to provide assistance from the Administration in the form of
grants to qualified organizations in accordance with this section.
``(c) Uses of Assistance.--A qualified organization shall use
grants made under this section--
``(1) to provide training and technical assistance to
disadvantaged entrepreneurs;
``(2) to provide training and capacity building services to
microenterprise development organizations and programs and
groups of such organizations to assist such organizations and
programs in developing microenterprise training and services;
``(3) to aid in researching and developing the best
practices in the field of microenterprise and technical
assistance programs for disadvantaged entrepreneurs;
``(4) to provide training and technical assistance to
disadvantaged Native American entrepreneurs and prospective
entrepreneurs; and
``(5) for such other activities as the Administrator
determines are consistent with the purposes of this section.
``(d) Qualified Organizations.--For purposes of eligibility for
assistance under this section, a qualified organization shall be--
``(1) a nonprofit microenterprise development organization
or program (or a group or collaborative thereof) that has a
demonstrated record of delivering microenterprise services to
disadvantaged entrepreneurs;
``(2) an intermediary;
``(3) a microenterprise development organization or program
that is accountable to a local community, working in
conjunction with a State or local government or Indian tribe;
or
``(4) an Indian tribe acting on its own, if the Indian
tribe can certify that no private organization or program
referred to in this subsection exists within its jurisdiction.
``(e) Allocation of Assistance; Subgrants.--
``(1) Allocation of assistance.--
``(A) In general.--The Administrator shall allocate
assistance from the Administration under this section
to ensure that--
``(i) activities described in subsection
(c)(1) are funded using not less than 75
percent of amounts made available for such
assistance; and
``(ii) activities described in subsection
(c)(2) are funded using not less than 15
percent of amounts made available for such
assistance.
``(B) Limit on individual assistance.--No single
person may receive more than 10 percent of the total
funds appropriated under this section in a single
fiscal year.
``(2) Targeted assistance.--The Administrator shall ensure
that not less than 50 percent of the grants made under this
section are used to benefit very low-income persons, including
those residing on Indian reservations.
``(3) Subgrants authorized.--
``(A) In general.--A qualified organization
receiving assistance under this section may provide
grants using that assistance to qualified small and
emerging microenterprise organizations and programs,
subject to such rules and regulations as the
Administrator determines to be appropriate.
``(B) Limit on administrative expenses.--Not more
than 7.5 percent of assistance received by a qualified
organization under this section may be used for
administrative expenses in connection with the making
of subgrants under subparagraph (A).
``(4) Diversity.--In making grants under this section, the
Administrator shall ensure that grant recipients include both
large and small microenterprise organizations, serving urban,
rural, and Indian tribal communities serving diverse
populations.
``(5) Prohibition on preferential consideration of certain
sba program participants.--In making grants under this section,
the Administrator shall ensure that any application made by a
qualified organization that is a participant in the program
established under section 7(m) of the Small Business Act does
not receive preferential consideration over applications from
other qualified organizations that are not participants in such
program.
``(f) Matching Requirements.--
``(1) In general.--Financial assistance under this section
shall be matched with funds from sources other than the Federal
Government on the basis of not less than 50 percent of each
dollar provided by the Administration.
``(2) Sources of matching funds.--Fees, grants, gifts,
funds from loan sources, and in-kind resources of a grant
recipient from public or private sources may be used to comply
with the matching requirement in paragraph (1).
``(3) Exception.--
``(A) In general.--In the case of an applicant for
assistance under this section with severe constraints
on available sources of matching funds, the
Administrator may reduce or eliminate the matching
requirements of paragraph (1).
``(B) Limitation.--Not more than 10 percent of the
total funds made available from the Administration in
any fiscal year to carry out this section may be
excepted from the matching requirements of paragraph
(1), as authorized by subparagraph (A) of this
paragraph.
``(g) Applications for Assistance.--An application for assistance
under this section shall be submitted in such form and in accordance
with such procedures as the Administrator shall establish.
``(h) Recordkeeping and Reporting.--
``(1) In general.--Each organization that receives
assistance from the Administration in accordance with this
section shall--
``(A) submit to the Administration not less than
once in every 18-month period, financial statements
audited by an independent certified public accountant;
``(B) submit an annual report to the Administration
on its activities; and
``(C) keep such records as may be necessary to
disclose the manner in which any assistance under this
section is used.
``(2) Access.--The Administration shall have access upon
request, for the purposes of determining compliance with this
section, to any records of any organization that receives
assistance from the Administration in accordance with this
section.
``(3) Data collection.--Each organization that receives
assistance from the Administration in accordance with this
section shall collect information relating to, as applicable--
``(A) the number of individuals counseled or
trained;
``(B) the number of hours of counseling provided;
``(C) the number of startup small business concerns
formed;
``(D) the number of small business concerns
expanded;
``(E) the number of low-income individuals
counseled or trained; and
``(F) the number of very low-income individuals
counseled or trained.
``(i) Authorization of Appropriations.--
``(1) In general.--There are authorized to be appropriated
to the Administrator $15,000,000 for each of the fiscal years
2004 through 2006 to carry out the provisions of this section,
which shall remain available until expended.
``(2) Training for native american entrepreneurs.--In
addition to the amount authorized under subsection (i)(1),
there are authorized to be appropriated to the Administrator
$2,000,000 for each of the fiscal years 2004 through 2006 to
carry out the provisions of subsection (c)(4), which shall
remain available until expended.
(b) Transfer Provisions.--
(1) Small business act amendments.--The Small Business Act
(15 U.S.C. 631 et seq.) is amended by redesignating section 37,
as added by this Act, as section 38.
(2) Transfer.--Section 37 of the Riegle Community
Development and Regulatory Improvement Act of 1994 (15 U.S.C.
6901 note), as so designated by subsection (a) of this section,
is transferred to, and inserted after, section 36 of the Small
Business Act, as added by this Act.
(c) References.--All references in Federal law to the ``Program for
Investment in Microentrepreneurs Act of 1999'' or the ``PRIME Act''
shall be deemed to be references to section 37 of the Small Business
Act, as added by this section.
(d) Rule of Construction.--Nothing in this section or the
amendments made by this section shall affect any grant or assistance
provided under the Program for Investment in Microentrepreneurs Act of
1999, before the date of enactment of this Act, and any such grant or
assistance shall be subject to the Program for Investment in
Microentrepreneurs Act of 1999, as in effect on the day before the date
of enactment of this Act.
Subtitle B--Women's Small Business Ownership Programs
SEC. 311. OFFICE OF WOMEN'S BUSINESS OWNERSHIP.
Section 29(g) of the Small Business Act (15 U.S.C. 656(g)) is
amended--
(1) in paragraph (2)--
(A) in subparagraph (B)(i), by striking ``in the
areas'' and all that follows through the end of
subclause (I), and inserting the following: ``to
address issues concerning operations, manufacturing,
technology, finance, retail and product sales,
international trade, and other disciplines required
for--
``(I) starting, operating, and
growing a small business concern;'';
and
(B) in subparagraph (C), by inserting ``, the
National Women's Business Council, and any association
of women's business centers, as defined in subsection
(a)'' before the period at the end; and
(2) by adding at the end the following:
``(3) Programs and services for women-owned small
businesses.--The Assistant Administrator, in consultation with
the National Women's Business Council, the Interagency
Committee on Women's Business Enterprise, and 1 or more
associations of women's business centers, shall develop
programs and services for women-owned businesses (as defined in
section 408 of the Women's Business Ownership Act of 1988 (15
U.S.C. 631 note)) in business areas, which may include--
``(A) manufacturing;
``(B) technology;
``(C) professional services;
``(D) retail and product sales;
``(E) travel and tourism;
``(F) international trade; and
``(G) Federal Government contract business
development.
``(4) Training.--The Administration shall provide annual
programmatic and financial oversight training for women's
business ownership representatives and district office
technical representatives of the Administration to enable these
representatives to carry out their responsibilities under this
section.
``(5) Grant program improvement.--The Administration shall
improve the women's business center grant proposal process and
the programmatic and financial oversight process by--
``(A) providing notice to the public of each
women's business center grant announcement for an
initial and renewal grant, not later than 6 months
before awarding such grant;
``(B) providing notice to grant applicants and
recipients of program evaluation criteria, not later
than 12 months before any such evaluation;
``(C) reducing paperwork and reporting requirements
for grant applicants and recipients;
``(D) standardizing the oversight and review
process of the Administration; and
``(E) providing to each women's business center,
not later than 30 days after the completion of a site
visit at that center, a copy of site visit reports and
evaluation reports prepared by district office
technical representatives or Administration
officials.''.
SEC. 312. WOMEN'S BUSINESS CENTER PROGRAM.
(a) Women's Business Center Grants Program.--Section 29 of the
Small Business Act (15 U.S.C. 656) is amended--
(1) in subsection (a)--
(A) by redesignating paragraphs (2), (3), and (4),
as paragraphs (3), (4), and (5), respectively; and
(B) by inserting after paragraph (1) the following:
``(2) the term `association of women's business centers'
means an organization that represents not less than 30 percent
of the women's business centers that are participating in a
program under this section and whose primary purpose is to
represent women's business centers;''; and
(2) by striking subsections (b) through (f) and inserting
the following:
``(b) Grants Authorized.--
``(1) In general.--The Administration may award initial and
renewal grants of not more than $150,000 per year, which shall
be known as `women's business center grants', to private
nonprofit organizations to conduct projects for the benefit of
small business concerns owned and controlled by women. At the
end of the initial 4-year grant period, and every 3 years
thereafter, the grant recipient may apply to renew the grant in
accordance with this subsection and subsection (e)(2). In the
event that the Administration has insufficient funds to provide
grants of $150,000, for each eligible women's business center,
available funds shall be allocated evenly to eligible centers,
unless any center requests a lower amount than the allocable
amount.
``(2) Cooperative agreement authority.--
``(A) In general.--The Administration may enter
into Federal cooperative agreements with grant
recipients under this subsection to perform the
services described under paragraph (3) only to the
extent and in the amount provided by appropriated
funds.
``(B) Termination.--
``(i) In general.--If any grant recipient
under this subsection does not fulfill its
grant obligations, after advanced notification,
during the period of the grant, the
Administration may terminate the grant.
``(ii) Exception.--Notwithstanding a grant
recipient's violation of a grant obligation
under this section, the Administration may
continue to fund the grant if the grant
recipient is making a good faith effort to
comply with such obligation.
``(3) Use of funds.--Grants awarded under paragraph (1) may
be used to provide training and counseling in the areas of--
``(A) pre-business, business startup, and business
operations;
``(B) financial planning assistance;
``(C) procurement assistance;
``(D) management assistance; and
``(E) marketing assistance.
``(4) Matching requirement.--
``(A) Women's business center grants.--As a
condition of receiving financial assistance under this
section, the grant recipient shall agree to obtain,
after its application has been approved and notice of
award has been issued, cash contributions from non-
Federal sources as follows:
``(i) In the first and second years, 1 non-
Federal dollar for each 2 Federal dollars
provided under the 4-year grant.
``(ii) In the third and fourth years, 1
non-Federal dollar for each Federal dollar
provided under the 4-year grant.
``(iii) In each renewal period, 1 non-
Federal dollar for each Federal dollar provided
under the 3-year grant.
``(B) Form of non-federal contributions.--Not more
than \1/2\ of the non-Federal sector matching
assistance may be in the form of in-kind contributions
that are budget line items only, including office
equipment and office space.
``(C) Failure to obtain non-federal funding.--
``(i) Advance disbursements.--If any grant
recipient fails to obtain the required non-
Federal contribution during any project year,
it shall not be eligible for advance
disbursements pursuant to subparagraph (D)
during the remainder of that project year.
``(ii) Ability to obtain non-federal
funding.--Before approving assistance to a
grant recipient that has failed to obtain the
required non-Federal contribution for any other
projects under this Act, the Administration
shall require the grant recipient to certify
that it will be able to obtain the requisite
non-Federal funding and enter a written finding
setting forth the reasons for making such
determination.
``(D) Form of federal contributions.--The financial
assistance authorized pursuant to this section may be
made by grant or cooperative agreement and may contain
such provision, as necessary, to provide for payments
in lump sum or installments, and in advance or by way
of reimbursement. The Administration may disburse up to
25 percent of each year's Federal share awarded to a
grant recipient after notice of the award has been
issued and before the non-Federal sector matching funds
are obtained.
``(5) Application for an initial grant.--Each organization
desiring an initial grant under this subsection, shall submit
to the Administration an application that contains--
``(A) a certification that the applicant--
``(i) is a private nonprofit organization;
``(ii) has designated an executive director
or program manager, who may be compensated from
grant funds or other sources, to manage the
center; and
``(iii) as a condition of receiving a grant
under this subsection, agrees--
``(I) to receive a site visit as
part of the final selection process;
``(II) to undergo an annual
programmatic and financial examination;
and
``(III) to the maximum extent
practicable, to remedy any problems
identified pursuant to the site visit
or examination under subclauses (I) and
(II);
``(B) information demonstrating that the applicant
has the ability and resources to meet the needs of the
market to be served by the women's business center site
for which an initial grant is sought, including the
ability to comply with the matching requirement under
paragraph (4);
``(C) information relating to assistance to be
provided by the women's business center site for which
an initial grant is sought in the area in which the
site is located;
``(D) information demonstrating the effective
experience of the applicant in--
``(i) conducting financial, management, and
marketing assistance programs, as described
under paragraph (3), which are designed to
teach or upgrade the business skills of women
who are business owners or potential business
owners;
``(ii) providing training and services to a
representative number of women who are both
socially and economically disadvantaged; and
``(iii) using resource partners of the
Administration and other entities, such as
universities;
``(E) a 4-year plan that projects the ability of
the women's business center site for which an initial
grant is sought--
``(i) to serve women business owners or
potential owners in the future by improving
training and counseling activities; and
``(ii) to provide training and services to
a representative number of women who are both
socially and economically disadvantaged; and
``(F) any additional information that the
Administration may reasonably require.
``(6) Review and approval of applications for an initial
grant.--
``(A) In general.--The Administration shall--
``(i) review each application submitted
under paragraph (5) based on the information
provided in such paragraph and the criteria set
forth under subparagraph (B); and
``(ii) as part of the final selection
process, conduct a site visit at each women's
business center for which an initial grant is
sought.
``(B) Selection criteria.--
``(i) In general.--The Administration shall
evaluate applicants in accordance with
predetermined selection criteria that shall be
stated in terms of relative importance. Such
criteria and their relative importance shall be
made publicly available and stated in each
solicitation for applications made by the
Administration.
``(ii) Required criteria.--The selection
criteria for an initial grant under clause (i)
shall include--
``(I) the experience of the
applicant in conducting programs or
ongoing efforts designed to teach or
upgrade the business skills of women
business owners or potential owners;
``(II) the ability of the applicant
to commence a project within a minimum
amount of time;
``(III) the ability of the
applicant to provide training and
services to a representative number of
women who are both socially and
economically disadvantaged; and
``(IV) the location for the women's
business center site proposed by the
applicant.
``(C) Record retention.--The Administration shall
maintain a copy of each application submitted under
this paragraph for not less than 7 years.
``(7) Application for a renewal grant.--Each organization
desiring a renewal grant under this subsection, shall submit to
the Administration, not later than 3 months before the
expiration of an existing grant under this subsection, an
application that contains--
``(A) a certification that the applicant--
``(i) is a private nonprofit organization;
``(ii) has designated an executive director
or program manager to manage the center; and
``(iii) as a condition of receiving a grant
under this subsection, agrees--
``(I) to receive a site visit as
part of the final selection process;
``(II) to submit, for the preceding
2 years, annual programmatic and
financial examination reports or
certified copies of the applicant's
compliance supplemental audits under
OMB Circular A-133; and
``(III) to the maximum extent
practicable, to remedy any problems
identified pursuant to the site visit
or examination under subclauses (I) and
(II);
``(B) information demonstrating that the applicant
has the ability and resources to meet the needs of the
market to be served by the women's business center site
for which a renewal grant is sought, including the
ability to comply with the matching requirement under
paragraph (4);
``(C) information relating to assistance to be
provided by the women's business center site for which
a renewal grant is sought in the area in which the site
is located;
``(D) information demonstrating the utilization of
resource partners of the Administration and other
entities;
``(E) a 3-year plan that projects the ability of
the women's business center site for which a renewal
grant is sought--
``(i) to serve women business owners or
potential owners in the future by improving
training and counseling activities; and
``(ii) to provide training and services to
a representative number of women who are both
socially and economically disadvantaged; and
``(F) any additional information that the
Administration may reasonably require.
``(8) Review and approval of applications for a renewal
grant.--
``(A) In general.--The Administration shall--
``(i) review each application submitted
under paragraph (7) based on the information
provided in such paragraph and the criteria set
forth under subparagraph (B); and
``(ii) as part of the final selection
process, conduct a site visit at each women's
business center for which a renewal grant is
sought.
``(B) Selection criteria.--The Administration shall
evaluate applicants in accordance with predetermined
selection criteria that shall be stated in terms of
relative importance. Such criteria and their relative
importance shall be made publicly available and stated
in each solicitation for applications made by the
Administration.
``(C) Conditions for continued funding.--In
determining whether to renew a grant or cooperative
agreement with a women's business center, the
Administration--
``(i) shall consider the results of the
most recent evaluation of the center, and, to a
lesser extent, previous evaluations; and
``(ii) may withhold such renewal, if the
Administration determines that the center has
failed to provide the information required to
be provided under this subsection, or the
information provided by the center is
inadequate.
``(D) Continuing grant and cooperative agreement
authority.--
``(i) In general.--The authority of the
Administrator to enter into grants or
cooperative agreements under this subsection
shall be in effect for each fiscal year only to
the extent and in the amounts as are provided
in advance in appropriations Acts.
``(ii) Renewal.--After the Administrator
has entered into a grant or cooperative
agreement with any women's business center
under this subsection, it shall not suspend,
terminate, or fail to renew or extend any such
grant or cooperative agreement unless the
Administrator provides the center with written
notification setting forth the reasons
therefore and affords the center an opportunity
for a hearing, appeal, or other administrative
proceeding under chapter 5 of title 5, United
States Code.
``(E) Record retention.--The Administration shall
maintain a copy of each application submitted under
this paragraph for not less than 7 years.
``(9) Data collection.--Consistent with the annual report
to Congress under subsection (g), each women's business center
site that is awarded an initial or renewal grant shall collect
information relating to--
``(A) the number of individuals counseled or
trained;
``(B) the number of hours of counseling provided;
``(C) the number of workshops conducted;
``(D) the number of startup small business concerns
formed; and
``(E) the number of jobs created or maintained at
assisted small business concerns.
``(10) Privacy requirements.--
``(A) In general.--A women's business center may
not disclose the name, address, or telephone number of
any individual or small business concern receiving
assistance under this section without the consent of
such individual or small business concern unless--
``(i) the Administrator is ordered to make
such a disclosure by a court in any civil or
criminal enforcement action initiated by a
Federal or State agency; or
``(ii) the Administrator considers such a
disclosure to be necessary for the purpose of
conducting a financial audit of a small
business development center, but a disclosure
under this clause shall be limited to the
information necessary for such audit.
``(B) Administration use of information.--This
section shall not--
``(i) restrict Administration access to
program activity data; or
``(ii) prevent the Administration from
using client information (other than the
information described in subparagraph (A)) to
conduct client surveys.
``(C) Regulations.--The Administrator shall issue
regulations to establish standards for requiring
disclosures during a financial audit under subparagraph
(A)(ii).
``(11) Transition rules.--
``(A) In general.--Notwithstanding any other
provision of law, a grant or cooperative agreement that
was awarded as an eligible sustainability grant, from
amounts appropriated for fiscal year 2003, to operate a
women's business center, shall remain in full force and
effect under the terms, and for the duration, of such
agreement, subject to the grant limitation in paragraph
(1).
``(B) Extension.--If the sustainability grant under
subparagraph (A) is scheduled to expire not later than
June 30, 2005, a 1-year extension shall be granted
without any interruption of funding, subject to the
grant limitation in paragraph (1).
``(C) Effect on certain existing projects and
renewal authority.--A project being conducted by a
women's business center under this subsection on the
day before the date of enactment of the Small Business
Administration 50th Anniversary Reauthorization Act of
2003--
``(i) as a 5-year project, shall remain in
full force and effect under the terms and for
the duration of that agreement; and
``(ii) shall be eligible to apply for a 3-
year renewal grant funded at a level equal to
not more than $150,000 per year.
``(c) Associations of Women's Business Centers.--
``(1) Recognition.--The Administration shall recognize the
existence and activities of any association of women's business
centers established to address matters of common concern.
``(2) Consultation.--The Administration shall consult with
each association of women's business centers (as defined in
subsection (a)) to develop--
``(A) a training program for the staff of the
women's business centers and the Administration; and
``(B) recommendations to improve the policies and
procedures for governing the general operations and
administration of the Women's Business Center Program,
including grant program improvements under subsection
(g)(5).''.
(b) Conforming Amendments.--Section 29 of the Small Business Act
(15 U.S.C. 656) is amended--
(1) by redesignating subsections (g), (h), (i), (j), and
(k) as subsections (d), (e), (f), (g), and (h), respectively;
(2) in subsection (e)(2), as redesignated by paragraph (1)
of this subsection, by striking ``to award a contract (as a
sustainability grant) under subsection (l) or'';
(3) in subsection (g)(1), as redesignated by paragraph (1)
of this subsection, by striking ``The Administration'' and
inserting ``Not later than November 1st of each year, the
Administration'';
(4) in subsection (h), as redesignated by paragraph (1) of
this subsection--
(A) by amending paragraph (1) to read as follows:
``(1) In general.--There are authorized to be appropriated
to carry out the provisions of this section, to remain
available until expended--
``(A) $15,000,000 for fiscal year 2004, of which
$500,000 may be used to provide supplemental
sustainability grants to women's business centers,
except that no such center may receive more than a
total of $125,000 in grant funding for the grant period
beginning on July 1, 2003 and ending on June 30, 2004;
``(B) $16,000,000 for fiscal year 2005; and
``(C) $17,500,000 for fiscal year 2006.'';
(B) by amending paragraph (2) to read as follows:
``(2) Use of amounts.--Amounts made available under this
subsection may only be used for grant awards and may not be
used for costs incurred by the Administration in connection
with the management and administration of the program under
this section.''; and
(C) by striking paragraph (4); and
(5) by striking subsection (l).
SEC. 313. NATIONAL WOMEN'S BUSINESS COUNCIL.
(a) Cosponsorship Authority.--Section 406 of the Women's Business
Ownership Act of 1988 (15 U.S.C. 7106) is amended by adding at the end
the following:
``(f) Cosponsorship Authority.--The Council is authorized to enter
into agreements as cosponsors with public and private entities, in the
same manner as is provided in section 8(b)(1)(A) of the Small Business
Act (15 U.S.C. 637(b)(1)(A)), to carry out its duties under this
section.''.
(b) Membership.--Section 407(f) of the Women's Business Ownership
Act of 1988 (15 U.S.C. 7107(f)) is amended by adding at the end the
following:
``(3) Representation of member organizations.--
Notwithstanding subsection (b), a national women's business
organization or small business that is represented on the
Council may, in consultation with the chairperson of the
Council, replace its representative member on the Council at
any time during the service term to which that member was
appointed.''.
(c) Establishment of Committees.--Title IV of the Women's Business
Ownership Act of 1988 (15 U.S.C. 7101 et seq.) is amended by inserting
after section 410, the following new section:
``SEC. 411. COMMITTEES.
``(a) Establishment.--There are established within the Council--
``(1) the Committee on Manufacturing, Technology, and
Professional Services;
``(2) the Committee on Travel, Tourism, Product and Retail
Sales, and International Trade; and
``(3) the Committee on Federal Procurement and Contracting.
``(b) Duties.--The Committees established under subsection (a)
shall perform such duties as the chairperson shall direct.''.
(d) Clearinghouse for Historical Documents.--Section 409 of the
Women's Business Ownership Act of 1988 (15 U.S.C. 7109) is amended by
adding at the end the following:
``(c) Clearinghouse for Historical Documents.--The Council shall
serve as a clearinghouse for information on small businesses owned and
controlled by women, including research conducted by other
organizations and individuals relating to ownership by women of small
businesses in the United States.''.
(e) Authorization of Appropriations.--Section 410(a) of the Women's
Business Ownership Act of 1988 (15 U.S.C. 7110(a)) is amended by
striking ``2001 through 2003, of which $550,000'' and inserting ``2004
through 2006, of which at least 30 percent''.
SEC. 314. INTERAGENCY COMMITTEE ON WOMEN'S BUSINESS ENTERPRISE.
(a) Chairperson.--Section 403(b) of the Women's Business Ownership
Act of 1988 (15 U.S.C. 7103(b)) is amended--
(1) by striking ``Not later'' and inserting the following:
``(1) In general.--Not later''; and
(2) by adding at the end the following:
``(2) Vacancy.--In the event that a chairperson is not
appointed under paragraph (1), the Deputy Administrator of the
Small Business Administration shall serve as acting chairperson
of the Interagency Committee until a chairperson is appointed
under paragraph (1).''.
(b) Policy Advisory Group.--Section 401 of the Women's Business
Ownership Act of 1988 (15 U.S.C. 7101) is amended--
(1) by striking ``There'' and inserting the following:
``(a) In General.--There''; and
(2) by adding at the end the following:
``(b) Policy Advisory Group.--
``(1) Establishment.--There is established a Policy
Advisory Group to assist the chairperson in developing policies
and programs under this Act.
``(2) Membership.--The Policy Advisory Group shall be
composed of 7 policy making officials, of whom--
``(A) 1 shall be a representative of the Small
Business Administration;
``(B) 1 shall be a representative of the Department
of Commerce;
``(C) 1 shall be a representative of the Department
of Labor;
``(D) 1 shall be a representative of the Department
of Defense;
``(E) 1 shall be a representative of the Department
of the Treasury; and
``(F) 2 shall be representatives of the National
Women's Business Council.''.
(c) Establishment of Subcommittees.--Section 401 of the Women's
Business Ownership Act of 1988 (15 U.S.C. 7101), as amended by
subsection (b), is further amended by adding at the end the following:
``(c) Subcommittees.--
``(1) Establishment.--There are established--
``(A) the Subcommittee on Manufacturing,
Technology, and Professional Services;
``(B) the Subcommittee on Travel, Tourism, Product
and Retail Sales, and International Trade; and
``(C) the Subcommittee on Federal Procurement and
Contracting.
``(2) Duties.--The Subcommittees established under
paragraph (1) shall perform such duties as the chairperson
shall direct.
``(3) Meetings.--The Interagency Committee shall meet not
less frequently than 3 times each year to--
``(A) plan activities for the new fiscal year;
``(B) track year-to-date agency contracting goals;
and
``(C) evaluate the progress during the fiscal year
and prepare an annual report.''.
SEC. 315. PRESERVING THE INDEPENDENCE OF THE NATIONAL WOMEN'S BUSINESS
COUNCIL.
(a) Short Title.--This section may be cited as the ``National
Women's Business Council Independence Preservation Act of 2003''.
(b) Findings.--Congress finds the following:
(1) The National Women's Business Council provides an
independent source of advice and policy recommendations
regarding women's business development and the needs of women
entrepreneurs in the United States to--
(A) the President;
(B) Congress;
(C) the Interagency Committee on Women's Business
Enterprise; and
(D) the Administrator of the Small Business
Administration.
(2) The members of the National Women's Business Council
are small business owners, representatives of business
organizations, and representatives of women's business centers.
(3) The chair and ranking member of the Committee on Small
Business and Entrepreneurship of the Senate and the Committee
on Small Business of the House of Representatives make
recommendations to the Administrator to fill 8 of the positions
on the National Women's Business Council. Four of the positions
are reserved for small business owners who are affiliated with
the political party of the President and 4 of the positions are
reserved for small business owners who are not affiliated with
the political party of the President. This method of
appointment ensures that the National Women's Business Council
will provide Congress with nonpartisan, balanced, and
independent advice.
(4) In order to maintain the independence of the National
Women's Business Council and to ensure that the Council
continues to provide Congress with advice on a nonpartisan
basis, it is essential that the Council maintain the bipartisan
balance established under section 407 of the Women's Business
Ownership Act of 1988 (15 U.S.C. 7107).
(c) Maintenance of Partisan Balance.--Section 407(f) of the Women's
Business Ownership Act of 1988 (15 U.S.C. 7107(f)) is amended--
(1) by striking ``A vacancy'' and inserting the following:
``(1) In general.--A vacancy''; and
(2) by adding at the end the following:
``(2) Partisan balance.--When filling vacancies under
paragraph (1), the Administrator shall, to the extent
practicable, ensure that there are an equal number of members
on the Council from each of the 2 major political parties.
``(3) Accountability.--If a vacancy is not filled within
the 30-day period required under paragraph (1) or if there
exists an imbalance of party-affiliated members on the Council
for a period exceeding 30 days, the Administrator shall submit
a report, not later than 10 days after the respective 30-day
deadline, to the Committee on Small Business and
Entrepreneurship of the Senate and the Committee on Small
Business of the House of Representatives, that explains why the
respective deadline was not met and provides an estimated date
on which any vacancies will be filled.''.
Subtitle C--Office of Native American Affairs
SEC. 321. SHORT TITLE.
This subtitle may be cited as the ``Native American Small Business
Development Act''.
SEC. 322. NATIVE AMERICAN SMALL BUSINESS DEVELOPMENT PROGRAM.
The Small Business Act (15 U.S.C. 631 et seq.) is amended--
(1) by redesignating section 36 as section 37; and
(2) by inserting after section 35 the following:
``SEC. 36. NATIVE AMERICAN SMALL BUSINESS DEVELOPMENT PROGRAM.
``(a) Definitions.--In this section--
``(1) the term `Alaska Native' has the same meaning as the
term `Native' in section 3(b) of the Alaska Native Claims
Settlement Act (43 U.S.C. 1602(b));
``(2) the term `Alaska Native corporation' has the same
meaning as the term `Native Corporation' in section 3(m) of the
Alaska Native Claims Settlement Act (43 U.S.C. 1602(m));
``(3) the term `Assistant Administrator' means the
Assistant Administrator of the Office of Native American
Affairs established under subsection (b);
``(4) the terms `center' and `Native American business
center' mean a center established under subsection (c);
``(5) the term `Native American business development
center' means an entity providing business development
assistance to federally recognized tribes and Native Americans
under a grant from the Minority Business Development Agency of
the Department of Commerce;
``(6) the term `Native American small business concern'
means a small business concern that is owned and controlled
by--
``(A) a member of an Indian tribe or tribal
government;
``(B) an Alaska Native or Alaska Native
corporation; or
``(C) a Native Hawaiian or Native Hawaiian
organization;
``(7) the term `Native Hawaiian' has the same meaning as in
section 625 of the Older Americans Act of 1965 (42 U.S.C.
3057k);
``(8) the term `Native Hawaiian organization' has the same
meaning as in section 8(a)(15) of this Act;
``(9) the term `tribal college' has the same meaning as the
term `tribally controlled college or university' has in section
2(a)(4) of the Tribally Controlled Community College Assistance
Act of 1978 (25 U.S.C. 1801(a)(4));
``(10) the term `tribal government' has the same meaning as
the term `Indian tribe' has in section 7501(a)(9) of title 31,
United States Code; and
``(11) the term `tribal lands' means all lands within the
exterior boundaries of any Indian reservation.
``(b) Office of Native American Affairs.--
``(1) Establishment.--There is established within the
Administration the Office of Native American Affairs, which,
under the direction of the Assistant Administrator, shall
implement the Administration's programs for the development of
business enterprises by Native Americans.
``(2) Purpose.--The purpose of the Office of Native
American Affairs is to assist Native American entrepreneurs
to--
``(A) start, operate, and grow small business
concerns;
``(B) develop management and technical skills;
``(C) seek Federal procurement opportunities;
``(D) increase employment opportunities for Native
Americans through the start and expansion of small
business concerns; and
``(E) increase the access of Native Americans to
capital markets.
``(3) Assistant administrator.--
``(A) Appointment.--The Administrator shall appoint
a qualified individual to serve as Assistant
Administrator of the Office of Native American Affairs
in accordance with this paragraph.
``(B) Qualifications.--The Assistant Administrator
appointed under subparagraph (A) shall have--
``(i) knowledge of the Native American
culture; and
``(ii) experience providing culturally
tailored small business development assistance
to Native Americans.
``(C) Employment status.--The Assistant
Administrator shall be a Senior Executive Service
position under section 3132(a)(2) of title 5, United
States Code, and shall serve as a noncareer appointee,
as defined in section 3132(a)(7) of title 5, United
States Code.
``(D) Responsibilities and duties.--The Assistant
Administrator shall--
``(i) administer and manage the Native
American Small Business Development program
established under this section;
``(ii) recommend the annual administrative
and program budgets for the Office of Native
American Affairs;
``(iii) consult with Native American
business centers in carrying out the program
established under this section;
``(iv) recommend appropriate funding
levels;
``(v) review the annual budgets submitted
by each applicant for the Native American Small
Business Development program;
``(vi) select applicants to participate in
the program under this section;
``(vii) implement this section; and
``(viii) maintain a clearinghouse to
provide for the dissemination and exchange of
information between Native American business
centers.
``(E) Consultation requirements.--In carrying out
the responsibilities and duties described in this
paragraph, the Assistant Administrator shall confer
with and seek the advice of--
``(i) Administration officials working in
areas served by Native American business
centers and Native American business
development centers;
``(ii) the Bureau of Indian Affairs of the
Department of the Interior;
``(iii) tribal governments;
``(iv) tribal colleges;
``(v) Alaska Native corporations; and
``(vi) Native Hawaiian organizations.
``(c) Native American Small Business Development Program.--
``(1) Authorization.--
``(A) In general.--The Administration, through the
Office of Native American Affairs, shall provide
financial assistance to tribal governments, tribal
colleges, Native Hawaiian organizations, and Alaska
Native corporations to create Native American business
centers in accordance with this section.
``(B) Use of funds.--The financial and resource
assistance provided under this subsection shall be used
to overcome obstacles impeding the creation,
development, and expansion of small business concerns,
in accordance with this section, by--
``(i) reservation-based American Indians;
``(ii) Alaska Natives; and
``(iii) Native Hawaiians.
``(2) 5-year projects.--
``(A) In general.--Each Native American business
center that receives assistance under paragraph (1)(A)
shall conduct 5-year projects that offer culturally
tailored business development assistance in the form
of--
``(i) financial education, including
training and counseling in--
``(I) applying for and securing
business credit and investment capital;
``(II) preparing and presenting
financial statements; and
``(III) managing cash flow and
other financial operations of a
business concern;
``(ii) management education, including
training and counseling in planning,
organizing, staffing, directing, and
controlling each major activity and function of
a small business concern; and
``(iii) marketing education, including
training and counseling in--
``(I) identifying and segmenting
domestic and international market
opportunities;
``(II) preparing and executing
marketing plans;
``(III) developing pricing
strategies;
``(IV) locating contract
opportunities;
``(V) negotiating contracts; and
``(VI) utilizing varying public
relations and advertising techniques.
``(B) Business development assistance recipients.--
The business development assistance under subparagraph
(A) shall be offered to prospective and current owners
of small business concerns that are owned by--
``(i) American Indians or tribal
governments, and located on or near tribal
lands;
``(ii) Alaska Natives or Alaska Native
corporations; or
``(iii) Native Hawaiians or Native Hawaiian
organizations.
``(3) Form of federal financial assistance.--
``(A) Documentation.--
``(i) In general.--The financial assistance
to Native American business centers authorized
under this subsection may be made by grant,
contract, or cooperative agreement.
``(ii) Exception.--Financial assistance
under this subsection to Alaska Native
corporations or Native Hawaiian organizations
may only be made by grant.
``(B) Payments.--
``(i) Timing.--Payments made under this
subsection may be disbursed in an annual lump
sum or in periodic installments, at the request
of the recipient.
``(ii) Advance.--The Administration may
disburse not more than 25 percent of the annual
amount of Federal financial assistance awarded
to a Native American small business center
after notice of the award has been issued.
``(iii) No matching requirement.--The
Administration shall not require a grant
recipient to match grant funding received under
this subsection with non-Federal resources as a
condition of receiving the grant.
``(4) Contract and cooperative agreement authority.--A
Native American business center may enter into a contract or
cooperative agreement with a Federal department or agency to
provide specific assistance to Native American and other under-
served small business concerns located on or near tribal lands,
to the extent that such contract or cooperative agreement is
consistent with the terms of any assistance received by the
Native American business center from the Administration.
``(5) Application process.--
``(A) Submission of a 5-year plan.--Each applicant
for assistance under paragraph (1) shall submit a 5-
year plan to the Administration on proposed assistance
and training activities.
``(B) Criteria.--
``(i) In general.--The Administration shall
evaluate and rank applicants in accordance with
predetermined selection criteria that shall be
stated in terms of relative importance.
``(ii) Public notice.--The criteria
required by this paragraph and their relative
importance shall be made publicly available,
within a reasonable time, and stated in each
solicitation for applications made by the
Administration.
``(iii) Considerations.--The criteria
required by this paragraph shall include--
``(I) the experience of the
applicant in conducting programs or
ongoing efforts designed to impart or
upgrade the business skills of current
or potential owners of Native American
small business concerns;
``(II) the ability of the applicant
to commence a project within a minimum
amount of time;
``(III) the ability of the
applicant to provide quality training
and services to a significant number of
Native Americans;
``(IV) previous assistance from the
Small Business Administration to
provide services in Native American
communities; and
``(V) the proposed location for the
Native American business center site,
with priority given based on the
proximity of the center to the
population being served and to achieve
a broad geographic dispersion of the
centers.
``(6) Program examination.--
``(A) In general.--Each Native American business
center established pursuant to this subsection shall
annually provide the Administration with an itemized
cost breakdown of actual expenditures incurred during
the preceding year.
``(B) Administration action.--Based on information
received under subparagraph (A), the Administration
shall--
``(i) develop and implement an annual
programmatic and financial examination of each
Native American business center assisted
pursuant to this subsection; and
``(ii) analyze the results of each
examination conducted under clause (i) to
determine the programmatic and financial
viability of each Native American business
center.
``(C) Conditions for continued funding.--In
determining whether to renew a grant, contract, or
cooperative agreement with a Native American business
center, the Administration--
``(i) shall consider the results of the
most recent examination of the center under
subparagraph (B), and, to a lesser extent,
previous examinations; and
``(ii) may withhold such renewal, if the
Administration determines that--
``(I) the center has failed to
provide adequate information required
to be provided under subparagraph (A),
or the information provided by the
center is inadequate; or
``(II) the center has failed to
provide adequate information required
to be provided by the center for
purposes of the report of the
Administration under subparagraph (E).
``(D) Continuing contract and cooperative agreement
authority.--
``(i) In general.--The authority of the
Administrator to enter into contracts or
cooperative agreements in accordance with this
subsection shall be in effect for each fiscal
year only to the extent and in the amounts as
are provided in advance in appropriations Acts.
``(ii) Renewal.--After the Administrator
has entered into a contract or cooperative
agreement with any Native American business
center under this subsection, it shall not
suspend, terminate, or fail to renew or extend
any such contract or cooperative agreement
unless the Administrator provides the center
with written notification setting forth the
reasons therefore and affords the center an
opportunity for a hearing, appeal, or other
administrative proceeding under chapter 5 of
title 5, United States Code.
``(E) Management report.--
``(i) In general.--The Administration shall
prepare and submit to the Committee on Small
Business and Entrepreneurship of the Senate and
the Committee on Small Business of the House of
Representatives an annual report on the
effectiveness of all projects conducted by
Native American business centers under this
subsection and any pilot programs administered
by the Office of Native American Affairs.
``(ii) Contents.--Each report submitted
under clause (i) shall include, with respect to
each Native American business center receiving
financial assistance under this subsection--
``(I) the number of individuals
receiving assistance from the Native
American business center;
``(II) the number of startup
business concerns created;
``(III) the number of existing
businesses seeking to expand
employment;
``(IV) jobs created or maintained,
on an annual basis, by Native American
small business concerns assisted by the
center since receiving funding under
this Act;
``(V) to the maximum extent
practicable, the capital investment and
loan financing utilized by emerging and
expanding businesses that were assisted
by a Native American business center;
and
``(VI) the most recent examination,
as required under subparagraph (B), and
the subsequent determination made by
the Administration under that
subparagraph.
``(7) Annual report.--Each entity receiving financial
assistance under this subsection shall annually report to the
Administration on the services provided with such financial
assistance, including--
``(A) the number of individuals assisted,
categorized by ethnicity;
``(B) the number of hours spent providing
counseling and training for those individuals;
``(C) the number of startup small business concerns
created or maintained;
``(D) the gross receipts of assisted small business
concerns;
``(E) the number of jobs created or maintained at
assisted small business concerns; and
``(F) the number of Native American jobs created or
maintained at assisted small business concerns.
``(8) Record retention.--
``(A) Applications.--The Administration shall
maintain a copy of each application submitted under
this subsection for not less than 7 years.
``(B) Annual reports.--The Administration shall
maintain copies of the information collected under
paragraph (6)(A) indefinitely.
``(d) Authorization of Appropriations.--There are authorized to be
appropriated $5,000,000 for each of the fiscal years 2004 through 2008,
to carry out the Native American Small Business Development Program,
authorized under subsection (c).''.
SEC. 323. PILOT PROGRAMS.
(a) Definitions.--In this section, the following definitions shall
apply:
(1) Incorporation by reference.--The terms defined in
section 36(a) of the Small Business Act (as added by this Act)
have the same meanings as in that section 36(a) when used in
this section.
(2) Joint project.--The term ``joint project'' means the
combined resources and expertise of 2 or more distinct entities
at a physical location dedicated to assisting the Native
American community.
(b) Native American Development Grant Pilot Program.--
(1) Authorization.--
(A) In general.--There is established a 4-year
pilot program under which the Administration is
authorized to award Native American development grants
to provide culturally tailored business development
training and related services to Native Americans and
Native American small business concerns.
(B) Eligible organizations.--The grants authorized
under subparagraph (A) may be awarded to--
(i) any small business development center;
or
(ii) any private, nonprofit organization
that--
(I) has members of an Indian tribe
comprising a majority of its board of
directors;
(II) is a Native Hawaiian
organization; or
(III) is an Alaska Native
corporation.
(C) Amounts.--The Administration shall not award a
grant under this subsection in an amount which exceeds
$100,000 for each year of the project.
(D) Grant duration.--Each grant under this
subsection shall be awarded for not less than a 2-year
period and not more than a 4-year period.
(2) Conditions for participation.--Each entity desiring a
grant under this subsection shall submit an application to the
Administration that contains--
(A) a certification that the applicant--
(i) is a small business development center
or a private, nonprofit organization under
paragraph (1)(B)(i);
(ii) employs an executive director or
program manager to manage the facility; and
(iii) agrees--
(I) to a site visit as part of the
final selection process;
(II) to an annual programmatic and
financial examination; and
(III) to the maximum extent
practicable, to remedy any problems
identified pursuant to that site visit
or examination;
(B) information demonstrating that the applicant
has the ability and resources to meet the needs,
including cultural needs, of the Native Americans to be
served by the grant;
(C) information relating to proposed assistance
that the grant will provide, including--
(i) the number of individuals to be
assisted; and
(ii) the number of hours of counseling,
training, and workshops to be provided;
(D) information demonstrating the effective
experience of the applicant in--
(i) conducting financial, management, and
marketing assistance programs designed to
impart or upgrade the business skills of
current or prospective Native American business
owners;
(ii) providing training and services to a
representative number of Native Americans;
(iii) using resource partners of the
Administration and other entities, including
universities, tribal governments, or tribal
colleges; and
(iv) the prudent management of finances and
staffing;
(E) the location where the applicant will provide
training and services to Native Americans; and
(F) a multiyear plan, corresponding to the length
of the grant, that describes--
(i) the number of Native Americans and
Native American small business concerns to be
served by the grant;
(ii) in the continental United States, the
number of Native Americans to be served by the
grant; and
(iii) the training and services to be
provided to a representative number of Native
Americans.
(3) Review of applications.--The Administration shall--
(A) evaluate and rank applicants under paragraph
(2) in accordance with predetermined selection criteria
that is stated in terms of relative importance;
(B) include such criteria in each solicitation
under this subsection and make such information
available to the public; and
(C) approve or disapprove each completed
application submitted under this subsection not more
than 60 days after submission.
(4) Annual report.--Each recipient of a Native American
development grant under this subsection shall annually report
to the Administration on the impact of the grant funding,
including--
(A) the number of individuals assisted, categorized
by ethnicity;
(B) the number of hours spent providing counseling
and training for those individuals;
(C) the number of startup small business concerns
created or maintained with assistance from a Native
American business center;
(D) the gross receipts of assisted small business
concerns;
(E) the number of jobs created or maintained at
assisted small business concerns; and
(F) the number of Native American jobs created or
maintained at assisted small business concerns.
(5) Record retention.--
(A) Applications.--The Administration shall
maintain a copy of each application submitted under
this subsection for not less than 7 years.
(B) Annual reports.--The Administration shall
maintain copies of the information collected under
paragraph (4) indefinitely.
(c) American Indian Tribal Assistance Center Grant Pilot Program.--
(1) Authorization.--
(A) In general.--There is established a 4-year
pilot program, under which the Administration shall
award not less than 3 American Indian Tribal Assistance
Center grants to establish joint projects to provide
culturally tailored business development assistance to
prospective and current owners of small business
concerns located on or near tribal lands.
(B) Eligible organizations.--
(i) Class 1.--Not fewer than 1 grant shall
be awarded to a joint project performed by a
Native American business center, a Native
American business development center, and a
small business development center.
(ii) Class 2.--Not fewer than 2 grants
shall be awarded to joint projects performed by
a Native American business center and a Native
American business development center.
(C) Amounts.--The Administration shall not award a
grant under this subsection in an amount which exceeds
$200,000 for each year of the project.
(D) Grant duration.--Each grant under this
subsection shall be awarded for a 3-year period.
(2) Conditions for participation.--Each entity desiring a
grant under this subsection shall submit to the Administration
a joint application that contains--
(A) a certification that each participant of the
joint application--
(i) is either a Native American business
center, a Native American business development
center, or a small business development center;
(ii) employs an executive director or
program manager to manage the center; and
(iii) as a condition of receiving the
American Indian Tribal Assistance Center grant,
agrees--
(I) to an annual programmatic and
financial examination; and
(II) to the maximum extent
practicable, to remedy any problems
identified pursuant to that
examination;
(B) information demonstrating an historic
commitment to providing assistance to Native
Americans--
(i) residing on or near tribal lands; or
(ii) operating a small business concern on
or near tribal lands;
(C) information demonstrating that each participant
of the joint application has the ability and resources
to meet the needs, including the cultural needs of the
Native Americans to be served by the grant;
(D) information relating to proposed assistance
that the grant will provide, including--
(i) the number of individuals to be
assisted; and
(ii) the number of hours of counseling,
training, and workshops to be provided;
(E) information demonstrating the effective
experience of each participant of the joint application
in--
(i) conducting financial, management, and
marketing assistance programs, as described
above, designed to impart or upgrade the
business skills of current or prospective
Native American business owners; and
(ii) the prudent management of finances and
staffing; and
(F) a plan for the length of the grant, that
describes--
(i) the number of Native Americans and
Native American small business concerns to be
served by the grant; and
(ii) the training and services to be
provided.
(3) Review of applications.--The Administration shall--
(A) evaluate and rank applicants under paragraph
(2) in accordance with predetermined selection criteria
that is stated in terms of relative importance;
(B) include such criteria in each solicitation
under this subsection and make such information
available to the public; and
(C) approve or disapprove each application
submitted under this subsection not more than 60 days
after submission.
(4) Annual report.--Each recipient of an American Indian
tribal assistance center grant under this subsection shall
annually report to the Administration on the impact of the
grant funding received during the reporting year, and the
cumulative impact of the grant funding received since the
initiation of the grant, including--
(A) the number of individuals assisted, categorized
by ethnicity;
(B) the number of hours of counseling and training
provided and workshops conducted;
(C) the number of startup business concerns created
or maintained with assistance from a Native American
business center;
(D) the gross receipts of assisted small business
concerns;
(E) the number of jobs created or maintained at
assisted small business concerns; and
(F) the number of Native American jobs created or
maintained at assisted small business concerns.
(5) Record retention.--
(A) Applications.--The Administration shall
maintain a copy of each application submitted under
this subsection for not less than 7 years.
(B) Annual reports.--The Administration shall
maintain copies of the information collected under
paragraph (4) indefinitely.
(d) Authorization of Appropriations.--There are authorized to be
appropriated--
(1) $1,000,000 for each of the fiscal years 2004 through
2007, to carry out the Native American Development Grant Pilot
Program, authorized under subsection (b); and
(2) $1,000,000 for each of the fiscal years 2004 through
2007, to carry out the American Indian Tribal Assistance Center
Grant Pilot Program, authorized under subsection (c).
Subtitle D--Office of Veterans Business Development
SEC. 331. ADVISORY COMMITTEE ON VETERANS BUSINESS AFFAIRS.
(a) Retention of Duties.--Section 33(h) of the Small Business Act
(15 U.S.C. 657c(h)) is amended by striking ``October 1, 2004'' and
inserting ``October 1, 2006''.
(b) Extension of Authority.--Section 203(h) of the Veterans
Entrepreneurship and Small Business Development Act of 1999 (15 U.S.C.
657b note) is amended by striking ``September 30, 2004'' and inserting
``September 30, 2006''.
SEC. 332. OUTREACH GRANTS FOR VETERANS.
Section 8(b)(17) of the Small Business Act (15 U.S.C. 637(b)(17))
is amended by inserting before the period at the end the following: ``,
veterans, and members of a reserve component of the Armed Forces''.
SEC. 333. AUTHORIZATION OF APPROPRIATIONS.
Section 32 of the Small Business Act (15 U.S.C. 657b) is amended by
adding at the end the following:
``(c) Authorization of Appropriations.--There are authorized to be
appropriated for carrying out the provisions of this section--
``(1) $1,000,000 for fiscal year 2004;
``(2) $1,500,000 for fiscal year 2005; and
``(3) $2,000,000 for fiscal year 2006.''.
TITLE IV--SMALL BUSINESS PROCUREMENT OPPORTUNITIES
SEC. 401. CONTRACT CONSOLIDATION.
(a) Definitions.--Section 3(o) of the Small Business Act (15 U.S.C.
632(o)) is amended to read as follows:
``(o) Definitions Relating to Consolidation of Contract
Requirements.--In this Act--
``(1) the terms `consolidation of contract requirements'
and `consolidation', with respect to contract requirements of a
military department, Defense Agency, Department of Defense
Field Activity, or any other Federal department or agency
having contracting authority mean a use of a solicitation to
obtain offers for a single contract or a multiple award
contract to satisfy 2 or more requirements of that department,
agency, or activity for goods or services that--
``(A) have previously been provided to or performed
for that department, agency, or activity under 2 or
more separate contracts that are smaller in cost than
the total cost of the contract for which the offers are
solicited; or
``(B) are of a type capable of being provided or
performed by a small business concern for that
department, agency, or activity under 2 or more
separate contracts that are smaller in cost than the
total cost of the contract for which the offers are
solicited;
``(2) the term `multiple award contract' means--
``(A) a contract that is entered into by the
Administrator of General Services under the multiple
award schedule program referred to in section
2302(2)(C) of title 10, United States Code;
``(B) a multiple award task order contract or
delivery order contract that is entered into under the
authority of sections 2304a through 2304d of title 10,
United States Code, or sections 303H through 303K of
the Federal Property and Administrative Services Act of
1949 (41 U.S.C. 253h through 253k); and
``(C) any other indeterminate delivery,
indeterminate quantity contract that is entered into by
the head of a Federal agency with 2 or more sources
pursuant to the same solicitation; and
``(3) the term `senior procurement executive' means--
``(A) with respect to a military department, the
official designated under section 16(3) of the Office
of Federal Procurement Policy Act (41 U.S.C. 414(3)) as
the senior procurement executive for the military
department;
``(B) with respect to a Defense Agency or a
Department of Defense Field Activity, the official so
designated for the Department of Defense; and
``(C) with respect to a Federal department or
agency other than those referred to in subparagraphs
(A) and (B), the official so designated by that
department or agency.''.
(b) Procurement Strategies.--Section 15(e) of the Small Business
Act (15 U.S.C. 644(e)) is amended--
(1) in paragraph (2)--
(A) by striking ``.--
``(A) In general''; and
(B) by striking subparagraphs (B) and (C); and
(2) by striking paragraph (3) and inserting the following:
``(3) Limitation on use of acquisition strategies involving
consolidation.--
``(A) Certain defense contract requirements.--An
official of a military department, defense agency, or
Department of Defense Field Activity shall not execute
an acquisition strategy that includes a consolidation
of contract requirements of the military department,
agency, or activity with a total value in excess of
$5,000,000, unless the senior procurement executive
first--
``(i) conducts market research;
``(ii) identifies any alternative
contracting approaches that would involve a
lesser degree of consolidation of contract
requirements; and
``(iii) determines that the consolidation
is necessary and justified.
``(B) Certain civilian agency contract
requirements.--The head of a Federal agency not
described in subparagraph (A) that has contracting
authority shall not execute an acquisition strategy
that includes a consolidation of contract requirements
of the agency with a total value in excess of
$2,000,000, unless the senior procurement executive of
the agency first--
``(i) conducts market research;
``(ii) identifies any alternative
contracting approaches that would involve a
lesser degree of consolidation of contract
requirements; and
``(iii) determines that the consolidation
is necessary and justified.
``(C) Additional requirements for higher value
consolidated contracts.--In addition to meeting the
requirements under subparagraph (A) or (B), a
procurement strategy by a civilian agency that includes
a consolidated contract valued at more than $5,000,000,
or by a defense agency that includes a consolidated
contract valued at more than $7,000,000 shall include--
``(i) an assessment of the specific
impediments to participation by small business
concerns as prime contractors that will result
from the consolidation;
``(ii) actions designed to maximize small
business participation as prime contractors,
including provisions that encourage small
business teaming for the consolidated
requirement;
``(iii) actions designed to maximize small
business participation as subcontractors
(including suppliers) at any tier under the
contract or contracts that may be awarded to
meet the requirements; and
``(iv) the identification of the
alternative strategies that would reduce or
minimize the scope of the consolidation and the
rationale for not choosing those alternatives.
``(D) Necessary and justified.--A senior
procurement executive may determine that an acquisition
strategy involving a consolidation of contract
requirements is necessary and justified for purposes of
subparagraph (A), (B), or (C), if the benefits of the
acquisition strategy substantially exceed the benefits
of each of the possible alternative contracting
approaches identified under clause (ii) of any of those
subparagraphs, as applicable. However, savings in
administrative or personnel costs alone do not
constitute, for such purpose, a sufficient
justification for a consolidation of contract
requirements in a procurement, unless the total amount
of the cost savings is expected to be substantial in
relation to the total cost of the procurement.
``(E) Benefits.--Benefits considered for purposes
of this paragraph may include cost and, regardless of
whether quantifiable in dollar amounts--
``(i) quality;
``(ii) acquisition cycle;
``(iii) terms and conditions; and
``(iv) any other benefit directly related
to national security or homeland defense.''.
(c) Report Requirements.--Section 15(p)(4)(B) of the Small Business
Act (15 U.S.C. 644(p)(4)(B)) is amended--
(1) in clause (i), by striking ``and'' at the end;
(2) in clause (ii), by striking the period at the end and
inserting the following: ``; and''; and
(3) by adding at the end the following:
``(iii) a description of best practices for
maximizing small business prime and
subcontracting opportunities.''.
(d) Procurement Center Representatives.--Section 15(l) of the Small
Business Act (15 U.S.C. 644(l)) is amended--
(1) by striking ``(l)(1)'' and inserting ``(2)'';
(2) by redesignating paragraphs (2) through (7) as
paragraphs (3) through (8), respectively;
(3) by inserting before paragraph (2), as so redesignated,
the following:
``(l)(1) The Administration shall assign not fewer than 1
procurement center representative at each major procurement center, in
addition to no less than 1 for each State.'';
(4) in paragraph (2), as redesignated, by striking ``to the
representative referred to in subsection (k)(6)'' and inserting
``to the traditional procurement center representative and the
commercial market representative, with each such position
filled by a different individual, and each such representative
having separate and distinct duties and responsibilities.'';
and
(5) by striking ``paragraph (2)'' each place that term
appears and inserting ``paragraph (3)''.
(e) Additional to Technical Advisers.--Section 15(k) of the Small
Business Act (15 U.S.C. 644(k)) is amended--
(1) in paragraph (5), by striking ``bundled contract'' and
inserting ``consolidated contract''; and
(2) in paragraph (8), by striking ``representative--'' and
inserting ``representative at each major procurement center
under subsection (l)(1)--''.
(f) Conforming Amendments.--Section 15(p) of the Small Business Act
(15 U.S.C. 644(p)) is amended--
(1) in the subsection heading, by striking ``Bundled
Contracts'' and inserting ``Consolidated Contracts'';
(2) in paragraph (1), in the paragraph heading, by striking
``Bundled contract'' and inserting ``Consolidated contract'';
(3) in paragraph (4), in the paragraph heading, by striking
``contract bundling'' and inserting ``contract consolidation'';
(4) by striking ``bundled contracts'' each place that term
appears and inserting ``consolidated contracts'';
(5) by striking ``bundled contract'' each place that term
appears and inserting ``consolidated contract'';
(6) by striking ``bundling of contract requirements'' each
place that term appears and inserting ``consolidation of
contract requirements'';
(7) in paragraph (4)(B)(ii), by striking ``previously
bundled'' and inserting ``previously consolidated'';
(8) in paragraph (4)(B)(ii)(I), by striking ``were
bundled'' and inserting ``were consolidated'';
(9) in paragraph (4)(B)(ii)(II)(bb), by striking ``bundling
the contract requirements'' and inserting ``the consolidation
of contract requirements''; and
(10) in paragraph (4)(B)(ii)(II)(cc), by striking ``bundled
status'' and inserting ``consolidated status''.
(g) GAO Study and Report.--
(1) Feasibility study required.--The Comptroller General of
the United States shall conduct a study of the feasibility of
setting thresholds, based on industry category, for permitting
the consolidation of contract requirements to proceed without
being subject to the additional benefit analyses required by
the amendments made by this section.
(2) Considerations.--The study conducted under paragraph
(1) shall include consideration of thresholds based on--
(A) the dollar value of the overall prime contract
at issue (including the average dollar value of a prime
contract in each industry category);
(B) the portion of such prime contract amounts that
could potentially include small business participation
as subcontractors;
(C) the availability of small business concerns in
each industry that have the capabilities and resources
to fulfill prime contract requirements; and
(D) such other criteria that the Comptroller
determines relevant.
(3) Report.--Not later than June 30, 2004, the Comptroller
General shall submit a report to Congress and the
Administration on the results of the study conducted under this
subsection, together with any recommendations with legislative
or regulatory action.
SEC. 402. AGENCY ACCOUNTABILITY.
(a) Agency Responsibilities.--Section 15(g)(2) of the Small
Business Act (15 U.S.C. 644(g)(2)) is amended--
(1) by inserting ``(A)'' after ``(2)'';
(2) by striking ``shall, after consultation'' and inserting
the following: ``shall--
``(i) after consultation'';
(3) by striking ``agency. Goals established'' and inserting
the following: ``agency;
``(ii) identify a percentage of the procurement budget of
the agency to be awarded to small business concerns, in
consultation with the Office of Small and Disadvantaged
Business Utilization of the agency, which information shall be
included in the strategic plan required under section 306 of
title 5, United States Code, and the annual budget submission
to Congress by that agency, and, upon request, in any testimony
provided by that agency before <DELETED>the</DELETED> Congress
in connection with the budget process; and
``(iii) report, as part of its annual performance plan,
required under section 1115 of title 31, United States Code,
the extent to which the agency achieved the goals referred to
in clause (ii), and appropriate justification for any failure
to do so.
``(B) Goals established'';
(4) by striking ``Whenever'' and inserting the following:
``(C) Whenever'';
(5) by striking ``For the purpose of'' and inserting the
following:
``(D) For the purpose of'';
(6) in the last sentence--
(A) by striking ``(A) contracts'' and inserting
``(i) contracts''; and
(B) by striking ``(B) contracts'' and inserting
``(ii) contracts''; and
(7) by adding at the end the following:
``(E)(i) Each procurement employee described in clause (iii)--
``(I) shall communicate to their subordinates the
importance of achieving small business goals; and
``(II) shall have as an annual performance evaluation
factor, where appropriate, the success of that procurement
employee in small business utilization, in accordance with the
goals established under this subsection.
``(ii) A procurement employee described in this clause is a senior
procurement executive, senior program manager, or small and
disadvantaged business utilization manager of a Federal agency having
contracting authority.''.
(b) Small and Disadvantaged Business Utilization.--Section 15(k)(3)
of the Small Business Act (15 U.S.C. 644(k)(3)) is amended to read as
follows:
``(3) be responsible only to, and report directly to, the
head of such agency, except that the Director of Small and
Disadvantaged Business Utilization for the Department of
Defense shall be responsible only to, and report directly to,
the Undersecretary of Defense for Acquisition, Technology, and
Logistics,''.
(c) Reports on Small Business Utilization.--Section 10(d) of the
Small Business Act (15 U.S.C. 639(d)) is amended--
(1) by inserting ``and each agency that is a member of the
President's Management Council (or any successor thereto)''
after ``Department of Defense'' the first place that term
appears; and
(2) by inserting ``or that agency'' after ``Department of
Defense'' the second place that term appears.
(d) Technical Correction.--
(1) In general.--Section 502(b) of the Veterans
Entrepreneurship and Small Business Development Act of 1999
(Public Law 106-50, 113 Stat. 248) is amended by striking
``Section 15'' and inserting ``Section 15(g)(2)''.
(2) Effect.--The amendment made by paragraph (1) shall be
deemed to have the same effective date as section 502(b) of the
Veterans Entrepreneurship and Small Business Development Act of
1999.
SEC. 403. SMALL BUSINESS PARTICIPATION IN PRIME CONTRACTING.
(a) Reserved Contracts.--Section 15(j) of the Small Business Act
(15 U.S.C. 644(j)) is amended by adding at the end the following:
``(4) Any adjustment to the simplified acquisition threshold (as
defined in section 4(11) of the Office of Federal Procurement Policy
Act (41 U.S.C. 403(11))), shall be immediately matched by an identical
adjustment to the small business reserve for purposes of this
subsection.''.
(b) Participation in Multiple Award Contracts.--Section 15(j) of
the Small Business Act (15 U.S.C. 644(j)) is amended--
(1) in paragraph (2), by striking ``(2) In carrying out
paragraph (1)'' and inserting ``(3) In carrying out paragraphs
(1) and (2)'';
(2) in paragraph (3), by striking ``(3) Nothing in
paragraph (1)'' and inserting ``(4) Nothing in this
subsection''; and
(3) by adding after paragraph (1) the following:
``(2)(A) In the case of orders under multiple award contracts,
including Federal Supply Schedule contracts and multi-agency contracts,
that are subject to the small business reserve, contracting officers
shall consider not less than 2 small business concerns if such small
business concerns can offer the items sought by the contracting officer
on competitive terms, with respect to price, quality, and delivery
schedule, with the goods or services available in the market.
``(B) If only 1 small business concern can satisfy the requirement,
the contracting officer shall include such small business concern in
their evaluation.''.
(c) Report Requirement.--
(1) In general.--Not less than once every 180 days, the
Comptroller General shall submit a report on the level of
participation in multiple award contracts, including the
Federal Supply Schedule to--
(A) the Small Business Administration;
(B) the Committee on Small Business and
Entrepreneurship of the Senate; and
(C) the Committee on Small Business of the House of
Representatives.
(2) Contents.--Each report submitted under paragraph (1)
shall contain, for the 6-month reporting period--
(A) the total number of multiple award contracts;
(B) the total number of small business concerns
that received multiple award contracts;
(C) the total number of orders;
(D) the total value of orders;
(E) the number of orders received by small business
concerns;
(F) the value of orders received by small business
concerns;
(G) the number of small business concerns that
received orders; and
(H) such other information that the Comptroller
General considers relevant.
SEC. 404. SMALL BUSINESS PARTICIPATION IN SUBCONTRACTING.
(a) Certifications Required.--Section 8(d)(6) of the Small Business
Act (15 U.S.C. 637(d)(6)) is amended--
(1) in subparagraph (E), by striking ``and'' at the end;
(2) in subparagraph (F), by striking the period at the end
and inserting ``; and''; and
``(G) certification that the offeror or bidder will acquire
articles, equipment, supplies, services, or materials, or
obtain the performance of construction work from small business
concerns in the amount and quality used in preparing the bid or
proposal, unless such small business concerns are no longer in
business or can no longer meet the quality, quantity, or
delivery date.''.
(b) Penalties for False Certifications.--Section 16(f) of the Small
Business Act (15 U.S.C. 645(f)) is amended by striking ``of this Act''
and inserting ``or the reporting requirements of section 8(d)(11)''.
SEC. 405. EVALUATING SUBCONTRACT PARTICIPATION IN AWARDING CONTRACTS.
(a) Significant Factors.--Section 8(d)(4)(G) of the Small Business
Act (15 U.S.C. 637(d)(4)(G)) is amended by striking ``a bundled'' and
inserting ``any''.
(b) Evaluation Reports.--Section 8(d)(10) of the Small Business Act
(15 U.S.C. 637(d)(10)) is amended--
(1) by striking ``is authorized to'' and inserting
``shall'';
(2) in subparagraph (B), by striking ``and'' at the end;
(3) in subparagraph (C), by striking the period at the end
and inserting ``; and''; and
(4) by adding at the end the following:
``(D) report the results of each evaluation under
subparagraph (C) to the appropriate contracting officers.''.
(c) Centralized Database; Payments Pending Reports.--Section 8(d)
of the Small Business Act (15 U.S.C. 637(d)) is amended--
(1) by redesignating paragraph (11) as paragraph (14); and
(2) by inserting after paragraph (10) the following:
``(11) Certification.--A report submitted by the prime contractor
pursuant to paragraph (6)(E) to determine the attainment of a
subcontract utilization goal under any subcontracting plan entered into
with a Federal agency under this subsection shall contain the name and
signature of the president or chief executive officer of the
contractor, certifying that the subcontracting data provided in the
report are accurate and complete.
``(12) Centralized database.--The results of an evaluation under
paragraph (10)(C) shall be included in a national centralized
governmentwide database.
``(13) Payments pending reports.--Each Federal agency having
contracting authority shall ensure that the terms of each contract for
goods and services includes a provision allowing the contracting
officer of an agency to withhold an appropriate amount of payment with
respect to a contract (depending on the size of the contract) until the
date of receipt of complete, accurate, and timely subcontracting
reports in accordance with paragraph (11).''.
(d) Referral of Material Breach to Inspectors General.--Section
8(d)(8) of the Small Business Act (15 U.S.C. 637(d)(8)) is amended by
adding at the end the following: ``A material breach described in this
paragraph shall be referred for investigation to the Inspector General
(or the equivalent) of the affected agency.''.
SEC. 406. DIRECT PAYMENTS TO SUBCONTRACTORS.
(a) In General.--Section 8(d) of the Small Business Act (15 U.S.C.
637(d)), as amended by section 405, is further amended by adding at the
end the following:
``(14) Timely payment to small business subcontractors.--
``(A) In general.--Subject to subparagraph (B), the failure
of a civilian agency prime contractor, as defined in
subparagraph (D), to make a timely payment, as determined by
the contract with the subcontractor, to a subcontractor that is
a small business concern shall be a material breach of the
contract with the Federal agency.
``(B) Consideration of performance.--Before making a
determination under subparagraph (A), the contracting officer
shall consider all reasonable issues regarding the
circumstances surrounding the failure to make the timely
payment described in subparagraph (A).
``(C) Withholding of payments.--Not later than 30 days
after the date on which a material breach under subparagraph
(A) is determined by the contracting officer, the Federal
agency may withhold any amounts due and owing the subcontractor
from payments due to the prime contractor and pay such amounts
directly to the subcontractor.
``(D) Defined term.--As used in this paragraph, the term
`civilian agency prime contractor' means a prime contractor
that offers any combination of services or manufactured goods
to Federal agencies other than the Department of Defense or
agencies with responsibility for homeland security or national
security.''.
(b) Sunset.--The amendment made by this section shall remain in
effect during the period beginning on the date of enactment of this Act
and ending on September 30, 2006.
SEC. 407. WOMEN-OWNED SMALL BUSINESS INDUSTRY STUDY.
Section 8(m)(4) of the Small Business Act (15 U.S.C. 637(m)(4)) is
amended to read as follows:
``(4) GAO identification of industries.--
``(A) Study.--The Comptroller General of the United
States shall conduct a study to identify industries in
which small business concerns owned and controlled by
women are underrepresented with respect to Federal
procurement contracting.
``(B) Report to congress.--Not later than December
31, 2003, the Comptroller General shall submit a report
to Congress on the results of the study conducted under
subparagraph (A), together with any recommendations for
legislative action.
``(C) Assistance from other agencies.--The
Comptroller General may request of any Federal agency,
and such agency shall provide, such information as the
Comptroller General determines necessary in carrying
out this paragraph, to the extent otherwise permitted
by law.''.
SEC. 408. HUBZONE AUTHORIZATIONS.
Section 31(d) of the Small Business Act (15 U.S.C. 657a(d)) is
amended--
(1) by striking ``2001'' and inserting ``2004''; and
(2) by striking ``2003'' and inserting ``2006''.
SEC. 409. DEFINITION OF HUBZONE; TREATMENT OF CERTAIN FORMER MILITARY
INSTALLATION LANDS AS HUBZONES.
(a) Base Closure Areas.--Section 3(p)(1) of the Small Business Act
(15 U.S.C. 632(p)(1)) is amended--
(1) in subparagraph (C), by striking ``or'' at the end;
(2) in subparagraph (D), by striking the period at the end
and inserting ``; or''; and
(3) by adding at the end the following:
``(E) base closure areas.''.
(b) HUBZone Status Timeline and Commencement.--
(1) In general.--A base closure area shall be treated as a
HUBZone for a period of 5 years beginning on the date of final
closure. A military base that was closed before the date of
enactment of this Act shall not be considered a base closure
area for purposes of this section.
(2) Effective date.--This section and the amendments made
by this section shall take effect on the date of enactment of
this Act.
(c) Definition.--Section 3(p)(4) of the Small Business Act (15
U.S.C. 632(p)(4)) is amended by adding at the end the following:
``(D) Base closure area.--The term `base closure
area' means lands within the external boundaries of a
military installation that were closed through a
privatization process under the authority of--
``(i) the Defense Base Closure and
Realignment Act of 1990 (part A of title XXIX
of Division B of Public Law 101-510; 10 U.S.C.
2687 note);
``(ii) title II of the Defense
Authorization Amendments and Base Closure and
Realignment Act (Public Law 100-526; 10 U.S.C.
2687 note);
``(iii) section 2687 of title 10, United
States Code; or
``(iv) any other provision of law
authorizing or directing the Secretary of
Defense or the Secretary of a military
department to dispose of real property at the
military installation for purposes relating to
base closures of redevelopment, while retaining
the authority to enter into a leaseback of all
or a portion of the property for military
use.''.
SEC. 410. DEFINITION OF HUBZONE SMALL BUSINESS CONCERN.
Section 3(p) of the Small Business Act (15 U.S.C. 632(p)) is
amended--
(1) by redesignating paragraphs (4) through (7) as
paragraphs (5) through (8), respectively; and
(2) by inserting after paragraph (3) the following:
``(4) Rule of construction relating to ownership.--For
purposes of paragraph (3)(A), the term `person' includes any
small business investment company, specialized small business
investment company, New Markets Venture Capital company (as
those terms are defined in sections 103 and 351, respectively,
of the Small Business Investment Act of 1958 (15 U.S.C. 662,
689), or other similar investment company, as determined by the
Administrator, if any such company comprises not more than 15
percent of the ownership of the subject small business
concern.''.
SEC. 411. ACQUISITION REGULATIONS.
Not later than 180 days after the date of enactment of this Act,
the governmentwide procurement regulations issued under sections 6(a)
and 25(c) of the Office of Federal Procurement Policy Act (41 U.S.C.
405(a) and 421(c)) and the procurement regulations described in section
25(c)(2) of the Office of Federal Procurement Policy Act (41 U.S.C.
421(c)(2)) that are issued by the Department of Defense shall be
amended as necessary to carry out this title and the amendments made by
this title.
TITLE V--MISCELLANEOUS
SEC. 501. MINORITY SMALL BUSINESS AND CAPITAL OWNERSHIP DEVELOPMENT
PROGRAM.
(a) Name Change.--Sections 4(b), 7(j), and 8(a) of the Small
Business Act (15 U.S.C. 633(b), 636(j), and 637(a)) are amended by
striking ``Minority Small Business and Capital Ownership Development''
each place it appears and inserting ``Business Development''.
(b) Conforming Amendments.--The Small Business Act (15 U.S.C. 631
et seq.) is amended--
(1) in section 2(d)(2)(B)(ii), by striking ``small business
and capital ownership development program'' and inserting
``small business development program'';
(2) in section 7(j)(10), by striking ``small business and
capital ownership development program'' and inserting ``small
business development program'';
(3) in section 7(j)(12)(A), by striking ``Capital Ownership
Development Program'' and inserting ``Business Development
Program''; and
(4) in section 8(a)(21)(B)(v)(I), by striking ``Capital
Ownership Development Program'' and inserting ``Business
Development Program.
(c) Annual Report.--Section 8(a)(20)(A) of the Small Business Act
(15 U.S.C. 637(a)(20)(A)) is amended by striking ``semiannually report
to their assigned Business Opportunity Specialist'' and inserting
``annually submit, to their assigned Business Opportunity Specialist, a
report, which shall include''.
SEC. 502. EXTENSION OF AUTHORITY FOR TECHNOLOGY ASSISTANCE PROGRAM.
(a) Rural Outreach.--Section 9(s)(2) of the Small Business Act (15
U.S.C. 638(s)(2)) is amended by striking ``2005'' and inserting
``2006''.
(b) FAST Program.--Section 34 of the Small Business Act (15 U.S.C.
657d) is amended--
(1) in subsection (h), by striking ``2005'' each place it
appears and inserting ``2006''; and
(2) by striking ``September 30, 2005'' and inserting
``September 30, 2006''.
SEC. 503. BUSINESSLINC REPORT TO CONGRESS.
Section 8(n) of the Small Business Act (15 U.S.C. 637(n)) is
amended by adding at the end the following:
``(4) Annual report.--
``(A) In general.--The Associate Administrator of
Business Development shall collect data on the
BusinessLINC program and submit an annual report by
April 30 of each year on the effectiveness of the
program to the Committee on Small Business and
Entrepreneurship of the Senate and the Committee on
Small Business of the House.
``(B) Contents.--The report submitted under
subparagraph (A) shall include--
``(i) the number of programs administered
in each State;
``(ii) the corresponding grant awards and
the date of each award;
``(iii) the dollar amount of the contracts
in effect in each State as a result of the
BusinessLINC program; and
``(iv) the number of teaming arrangements
or partnerships created as a result of the
BusinessLINC program.''.
Passed the Senate September 26, 2003.
Attest:
Secretary.
108th CONGRESS
1st Session
S. 1375
_______________________________________________________________________
AN ACT
To provide for the reauthorization of programs administered by the
Small Business Administration, and for other purposes.