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106th Congress                                            Rept. 106-206
                        HOUSE OF REPRESENTATIVES
 1st Session                                                     Part 1

======================================================================



 
  VETERANS ENTREPRENEURSHIP AND SMALL BUSINESS DEVELOPMENT ACT OF 1999

                                _______
                                

 June 29, 1999.--Committed to the Committee of the Whole House on the 
              State of the Union and ordered to be printed

                                _______


    Mr. Talent, from the Committee on Small Business, submitted the 
                               following

                              R E P O R T

                        [To accompany H.R. 1568]

      [Including cost estimate of the Congressional Budget Office]

  The Committee on Small Business, to whom was referred the 
bill (H.R. 1568) to provide technical, financial, and 
procurement assistance to veteran owned small businesses, and 
for other purposes, having considered the same, report 
favorably thereon with an amendment and recommend that the bill 
as amended do pass.
  The amendment is as follows:
  Strike out all after the enacting clause and insert in lieu 
thereof the following:

SECTION 1. SHORT TITLE.

  This Act may be cited as the ``Veterans Entrepreneurship and Small 
Business Development Act of 1999''.

SEC. 2. TABLE OF CONTENTS.

Sec. 1. Short title.
Sec. 2. Table of contents.

                       TITLE I--GENERAL PROVISIONS

Sec. 101. Findings.
Sec. 102. Purpose.
Sec. 103. Definitions.

                 TITLE II--VETERANS BUSINESS DEVELOPMENT

Sec. 201. Veterans business development in the Small Business 
          Administration.
Sec. 202. National Veterans Business Development Corporation.
Sec. 203. Advisory Committee on Veterans Business Affairs.

                     TITLE III--TECHNICAL ASSISTANCE

Sec. 301. SCORE program.
Sec. 302. Entrepreneurial assistance.
Sec. 303. Business development and management assistance for military 
          reservists' small businesses.

                     TITLE IV--FINANCIAL ASSISTANCE

Sec. 401. General business loan program.
Sec. 402. Assistance to active duty military reservists.
Sec. 403. Microloan program.
Sec. 404. Delta loan program.
Sec. 405. State development company program.

                     TITLE V--PROCUREMENT ASSISTANCE

Sec. 501. Subcontracting.
Sec. 502. Participation in Federal procurement.

                  TITLE VI--REPORTS AND DATA COLLECTION

Sec. 601. Reporting requirements.
Sec. 602. Report on small business and competition.
Sec. 603. Annual report of the Administrator.
Sec. 604. Data and information collection.

                   TITLE VII--MISCELLANEOUS PROVISIONS

Sec. 701. Administrator's order.
Sec. 702. Small Business Administration Office of Advocacy.
Sec. 703. Study of fixed-asset small business loans.



                       TITLE I--GENERAL PROVISIONS



SEC. 101. FINDINGS.

  Congress finds the following:
          (1) Veterans of the United States Armed Forces have been and 
        continue to be vital to the small business enterprises of the 
        United States.
          (2) In serving the United States, veterans often faced great 
        risks to preserve the American dream of freedom and prosperity.
          (3) The United States has done too little to assist veterans, 
        particularly service-disabled veterans, in playing a greater 
        role in the economy of the United States by forming and 
        expanding small business enterprises.
          (4) Medical advances and new medical technologies have made 
        it possible for service-disabled veterans to play a much more 
        active role in the formation and expansion of small business 
        enterprises in the United States.
          (5) The United States must provide additional assistance and 
        support to veterans to better equip them to form and expand 
        small business enterprises, thereby enabling them to realize 
        the American dream that they fought to protect.

SEC. 102. PURPOSE.

  The purpose of this Act is to expand existing and establish new 
assistance programs for veterans who own or operate small businesses. 
This Act accomplishes this purpose by--
          (1) expanding the eligibility for certain small business 
        assistance programs to include veterans;
          (2) directing certain departments and agencies of the United 
        States to take actions that enhance small business assistance 
        to veterans; and
          (3) establishing new institutions to provide small business 
        assistance to veterans or to support the institutions that 
        provide such assistance.

SEC. 103. DEFINITIONS.

  (a) Small Business Act.--Section 3 of the Small Business Act (15 
U.S.C. 632) is amended by adding at the end the following:
          ``(q) Definitions Relating to Veterans.--In this Act, the 
        following definitions apply:
          ``(1) Service-disabled veteran.--The term `service-disabled 
        veteran' means a veteran with a disability that is service-
        connected (as defined in section 101(16) of title 38, United 
        States Code).
          ``(2) Small business concern owned and controlled by service-
        disabled veterans.--The term `small business concern owned and 
        controlled by service-disabled veterans' means a small business 
        concern--
                  ``(A) not less than 51 percent of which is owned by 1 
                or more service-disabled veterans or, in the case of 
                any publicly owned business, not less than 51 percent 
                of the stock of which is owned by 1 or more service-
                disabled veterans; and
                  ``(B) the management and daily business operations of 
                which are controlled by 1 or more service-disabled 
                veterans or, in the case of a veteran with permanent 
                and severe disability, the spouse or permanent 
                caregiver of such veteran.
          ``(3) Small business concern owned and controlled by 
        veterans.--The term `small business concern owned and 
        controlled by veterans' means a small business concern--
                  ``(A) not less than 51 percent of which is owned by 1 
                or more veterans or, in the case of any publicly owned 
                business, not less than 51 percent of the stock of 
                which is owned by 1 or more veterans; and
                  ``(B) the management and daily business operations of 
                which are controlled by 1 or more veterans.
          ``(4) Veteran.--The term `veteran' has the meaning given the 
        term in section 101(2) of title 38, United States Code.''.
  (b) Applicability to This Act.--In this Act, the definitions 
contained in section 3(q) of the Small Business Act, as added by this 
section, apply.

                TITLE II--VETERANS BUSINESS DEVELOPMENT

SEC. 201. VETERANS BUSINESS DEVELOPMENT IN THE SMALL BUSINESS 
                    ADMINISTRATION.

  (a) In General.--Section 4(b)(1) of the Small Business Act (15 U.S.C. 
633(b)(1)) is amended--
          (1) in the 5th sentence, by striking ``four Associate 
        Administrators'' and inserting ``five Associate 
        Administrators''; and
          (2) by inserting after the 5th sentence the following: ``One 
        such Associate Administrator shall be the Associate 
        Administrator for Veterans Business Development, who shall 
        administer the Office of Veterans Business Development 
        established under section 32.''.
  (b) Office of Veterans Business Development; Associate 
Administrator.--The Small Business Act (15 U.S.C. 631 et seq.) is 
further amended--
          (1) by redesignating section 32 as section 34; and
          (2) by inserting after section 31 the following:

``SEC. 32. VETERANS PROGRAMS.

  ``(a) Office of Veterans Business Development.--There is established 
in the Administration an Office of Veterans Business Development, which 
shall be administered by the Associate Administrator for Veterans 
Business Development (in this section referred to as the `Associate 
Administrator') appointed under section 4(b)(1).
  ``(b) Associate Administrator for Veterans Business Development.--The 
Associate Administrator--
          ``(1) shall be an appointee in the Senior Executive Service;
          ``(2) shall be responsible for the formulation, execution, 
        and promotion of policies and programs of the Administration 
        that provide assistance to small business concerns owned and 
        controlled by veterans and small business concerns owned and 
        controlled by service-disabled veterans. The Associate 
        Administrator shall act as an ombudsman for full consideration 
        of veterans in all programs of the Administration; and
          ``(3) shall report to and be responsible directly to the 
        Administrator.''.

SEC. 202. NATIONAL VETERANS BUSINESS DEVELOPMENT CORPORATION.

  The Small Business Act (15 U.S.C. 631 et seq.) is further amended by 
adding after section 32 (as added by this Act) the following:

``SEC. 33. NATIONAL VETERANS BUSINESS DEVELOPMENT CORPORATION.

  ``(a) Establishment.--There is established a federally chartered 
corporation to be known as the National Veterans Business Development 
Corporation (in this section referred to as the `Corporation') which 
shall be incorporated under the laws of the District of Columbia and 
which shall have the powers granted in this section.
  ``(b) Purposes of the Corporation.--The purposes of the Corporation 
shall be--
          ``(1) to expand the provision of and improve access to 
        technical assistance regarding entrepreneurship for the 
        Nation's veterans; and
          ``(2) to assist veterans, including service-disabled 
        veterans, with the formation and expansion of small business 
        concerns by working with and organizing public and private 
        resources, including those of the Small Business 
        Administration, the Department of Veterans Affairs, the 
        Department of Labor, the Department of Commerce, the Department 
        of Defense, the Service Corps of Retired Executives (described 
        in section 8(b)(1)(B) of this Act), the Small Business 
        Development Centers (described in section 21 of this Act), and 
        the business development staffs of each department and agency 
        of the United States.
  ``(c) Board of Directors.--
          ``(1) In general.--The management of the Corporation shall be 
        vested in a Board of Directors composed of 9 voting members and 
        3 nonvoting ex officio members.
          ``(2) Appointment of voting members.--The President shall 
        appoint United States citizens to be voting members of the 
        Board of Directors as follows:
                  ``(A) 1 from a list of individuals nominated by the 
                chairman of the Committee on Small Business of the 
                House of Representatives.
                  ``(B) 1 from a list of individuals nominated by the 
                chairman of the Committee on Small Business of the 
                Senate.
                  ``(C) 1 from a list of individuals nominated by the 
                ranking minority member of the Committee on Small 
                Business of the House of Representatives.
                  ``(D) 1 from a list of individuals nominated by the 
                ranking minority members of the Committee on Small 
                Business of the Senate.
                  ``(E) 1 from a list of individuals nominated by the 
                chairman of the Committee on Veterans' Affairs of the 
                House of Representatives.
                  ``(F) 1 from a list of individuals nominated by the 
                chairman of the Committee on Veterans' Affairs of the 
                Senate.
                  ``(G) 1 from a list of individuals nominated by the 
                ranking minority member of the Committee on Veterans' 
                Affairs of the House of Representatives.
                  ``(H) 1 from a list of individuals nominated by the 
                ranking minority member of the Committee on Veterans' 
                Affairs of the Senate.
                  ``(I) 1 of the President's own choosing.
          ``(3) Ex officio members.--The Administrator of the Small 
        Business Administration, the Secretary of Defense, and the 
        Secretary of Veterans Affairs shall serve as the nonvoting ex 
        officio members of the Board of Directors.
          ``(4) Chairperson.--The members of the Board of Directors 
        appointed under paragraph (2) shall elect one such member to 
        serve as chairperson of the Board of Directors for a term of 2 
        years.
          ``(5) Terms of appointed members.--
                  ``(A) In general.--Each member of the Board of 
                Directors appointed under paragraph (2) shall serve a 
                term of 6 years, except as provided in subparagraph 
                (B).
                  ``(B) Terms of initial appointees.--As designated by 
                the President at the time of appointment, of the 
                members first appointed--
                          ``(i) 3 shall be for a term of 2 years; and
                          ``(ii) 3 shall be for a term of 4 years.
                  ``(C) Unexpired terms.--Any member of the Board of 
                Directors appointed to fill a vacancy occurring before 
                the expiration of the term for which the member's 
                predecessor was appointed shall be appointed only for 
                the remainder of the term. A member may serve after the 
                expiration of that member's term until a successor has 
                taken office.
          ``(6) Vacancies.--Any vacancy on the Board of Directors shall 
        be filled in the manner in which the original appointment was 
        made. In the case of a vacancy in the office of the 
        Administrator of the Small Business Administration or the 
        Secretary of Veterans Affairs, and pending the appointment of a 
        successor, an acting appointee for such vacancy may serve as an 
        ex officio member.
          ``(7) Ineligibility for other offices.--No voting member of 
        the Board of Directors may be an officer or employee of the 
        United States while serving as a member of the Board of 
        Directors or during the 2-year period preceding such service.
          ``(8) Impartiality and nondiscrimination.--The Board of 
        Directors shall administer the affairs of the Corporation 
        fairly and impartially and without discrimination.
          ``(9) Obligations and expenses.--The Board of Directors shall 
        prescribe the manner in which the obligations of the 
        Corporation may be incurred and in which its expenses shall be 
        allowed and paid.
          ``(10) Quorum.--5 voting members of the Board of Directors 
        shall constitute a quorum, but a lesser number may hold 
        hearings.
  ``(d) Corporate Powers.--On October 1, 1999, the Corporation shall 
become a body corporate and as such shall have the authority to do the 
following:
          ``(1) To adopt and use a corporate seal.
          ``(2) To have succession until dissolved by an Act of 
        Congress.
          ``(3) To make contracts or grants.
          ``(4) To sue and be sued, and to file and defend against 
        lawsuits in State or Federal court.
          ``(5) To appoint, through the actions of its Board of 
        Directors, officers and employees of the Corporation, to define 
        their duties and responsibilities, fix their compensations, and 
        to dismiss at will such officers or employees.
          ``(6) To prescribe, through the actions of its Board of 
        Directors, bylaws not inconsistent with Federal law and the law 
        of the State of incorporation, regulating the manner in which 
        its general business may be conducted and the manner in which 
        the privileges granted to it by law may be exercised.
          ``(7) To exercise, through the actions of its Board of 
        Directors or duly authorized officers, all powers specifically 
        granted by the provisions of this section, and such incidental 
        powers as shall be necessary.
          ``(8) To solicit, receive, and disburse funds from private, 
        Federal, State and local organizations.
          ``(9) To accept and employ or dispose of in furtherance of 
        the purposes of this section any money or property, real, 
        personal, or mixed, tangible or intangible, received by gift, 
        devise, bequest, or otherwise.
          ``(10) To accept voluntary and uncompensated services.
  ``(e) Corporate Funds.--
          ``(1) Deposit of funds.--The Board of Directors shall deposit 
        all funds of the Corporation in federally chartered and insured 
        depository institutions until such funds are disbursed under 
        paragraph (2).
          ``(2) Disbursement of funds.--Funds of the Corporation may be 
        disbursed only for purposes that are--
                  ``(A) approved by the Board of Directors by a 
                recorded vote with a quorum present; and
                  ``(B) in accordance with the purposes of the 
                Corporation as specified in subsection (b).
  ``(f) Network of Information and Assistance Centers.--In carrying out 
the purpose described in subsection (b), the Corporation shall 
establish and maintain a network of information and assistance centers 
for use by veterans and the public.
  ``(g) Annual Report.--On or before October 1 of each year, the Board 
of Directors shall transmit a report to the President and Congress 
describing the activities and accomplishments of the Corporation for 
the preceding year and the Corporation's findings regarding the efforts 
of Federal, State and private organizations to assist veterans in the 
formation and expansion of small business concerns.
  ``(h) Assumption of Duties of Advisory Committee.--On October 1, 
2004, the Corporation established under this section shall assume the 
duties, responsibilities, and authority of the Advisory Committee on 
Veterans Affairs established under section 203 of this Act.
  ``(i) Use of Mails.--The Corporation may use the United States mails 
in the same manner and under the same conditions as the departments and 
agencies of the United States.
  ``(j) Professional Certification Advisory Board.--
          ``(1) In general.--Acting through the Board of Directors, the 
        Corporation shall establish a Professional Certification 
        Advisory Board to create uniform guidelines and standards for 
        the professional certification of members of the Armed Services 
        to aid in their efficient and orderly transition to civilian 
        occupations and professions and to remove potential barriers in 
        the areas of licensure and certification.
          ``(2) Membership.--The members of the Advisory Board shall 
        serve without compensation, shall meet in the District of 
        Columbia no less than quarterly, and shall be appointed by the 
        Board of Directors as follows:
                  ``(A) Private sector members.--The Corporation shall 
                appoint not less than 7 members for terms of 2 years to 
                represent private sector organizations and 
                associations, including the American Association of 
                Community Colleges, the Society for Human Resource 
                Managers, the Coalition for Professional Certification, 
                and the Council on Licensure and Enforcement.
                  ``(B) Public sector members.--The Corporation shall 
                invite public sector members to serve at the discretion 
                of their departments or agencies and shall--
                          ``(i) encourage the participation of the 
                        Under Secretary of Defense for Personnel and 
                        Readiness;
                          ``(ii) encourage the participation of 2 
                        officers from each branch of the Armed Forces 
                        to represent the Training Commands of their 
                        branch; and
                          ``(iii) seek the participation and guidance 
                        of the Assistant Secretary of Labor for 
                        Veterans' Employment and Training.
  ``(k) Authorization of Appropriations.--
          ``(1) In general.--There are authorized to be appropriated to 
        the Corporation to carry out this section the following 
        amounts:
                  ``(A) $2,000,000 for fiscal year 2000;
                  ``(B) $4,000,000 for fiscal year 2001;
                  ``(C) $4,000,000 for fiscal year 2002; and
                  ``(D) $2,000,000 for fiscal year 2003.
          ``(2) Privatization.--The Corporation shall institute and 
        implement a plan to raise private funds and become a self-
        sustaining corporation.''.

SEC. 203. ADVISORY COMMITTEE ON VETERANS BUSINESS AFFAIRS.

  (a) In General.--There is established an advisory committee to be 
known as the ``Advisory Committee on Veterans Business Affairs'' (in 
this section referred to as the ``Committee''), which shall serve as an 
independent source of advice and policy recommendations to--
          (1) the Administrator of the Small Business Administration 
        (in this section referred to as the ``Administrator'');
          (2) the Associate Administrator for Veterans Business 
        Development of the Small Business Administration;
          (3) Congress;
          (4) the President; and
          (5) other United States policymakers.
  (b) Membership.--
          (1) In general.--The Committee shall be composed of 15 
        members, of whom--
                  (A) 8 shall be veterans who are owners of small 
                business concerns (within the meaning of the term under 
                section 3 of the Small Business Act (15 U.S.C. 632)); 
                and
                  (B) 7 shall be representatives of veterans 
                organizations.
          (2) Appointment.--
                  (A) In general.--The members of the Committee shall 
                be appointed by the Administrator in accordance with 
                this section.
                  (B) Initial appointments.--Not later than 90 days 
                after the date of enactment of this Act, the 
                Administrator shall appoint the initial members of the 
                Committee.
          (3) Political affiliation.--Not more than 8 members of the 
        Committee shall be of the same political party as the 
        President.
          (4) Prohibition on federal employment.--
                  (A) In general.--Except as provided in subsection 
                (B), no member of the Committee may serve as an officer 
                or employee of the United States.
                  (B) Exception.--A member of the Committee who accepts 
                a position as an officer or employee of the United 
                States after the date of the member's appointment to 
                the Committee may continue to serve on the Committee 
                for not more than 30 days after such acceptance.
          (5) Term of service.--
                  (A) In general.--Subject to subparagraph (B), the 
                term of service of each member of the Committee shall 
                be 3 years.
                  (B) Terms of initial appointees.--As designated by 
                the Administrator at the time of appointment, of the 
                members first appointed--
                          (i) 6 shall be appointed for a term of 4 
                        years; and
                          (ii) 5 shall be appointed for a term of 5 
                        years.
          (6) Vacancies.--The Administrator shall fill any vacancies on 
        the membership of the Committee not later than 30 days after 
        the date on which such vacancy occurs.
          (7) Chairperson.--
                  (A) In general.--The members of the Committee shall 
                elect one of the members to be Chairperson of the 
                Committee.
                  (B) Vacancies in office of chairperson.--Any vacancy 
                in the office of the Chairperson of the Committee shall 
                be filled by the Committee at the first meeting of the 
                Committee following the date on which the vacancy 
                occurs.
  (c) Duties.--The duties of the Committee shall be the following:
          (1) Review, coordinate, and monitor plans and programs 
        developed in the public and private sectors, that affect the 
        ability of small business concerns owned and controlled by 
        veterans to obtain capital and credit and to access markets.
          (2) Promote the collection of business information and survey 
        data as they relate to veterans and small business concerns 
        owned and controlled by veterans.
          (3) Monitor and promote plans, programs, and operations of 
        the departments and agencies of the United States that may 
        contribute to the formation and growth of small business 
        concerns owned and controlled by veterans.
          (4) Develop and promote initiatives, policies, programs, and 
        plans designed to foster small business concerns owned and 
        controlled by veterans.
          (5) In cooperation with the National Veterans Business 
        Development Corporation, develop a comprehensive plan, to be 
        updated annually, for joint public-private sector efforts to 
        facilitate growth and development of small business concerns 
        owned and controlled by veterans.
  (d) Powers.--
          (1) Hearings.--Subject to subsection (e), the Committee may 
        hold such hearings, sit and act at such times and places, take 
        such testimony, and receive such evidence as the Committee 
        considers advisable to carry out its duties.
          (2) Information from federal agencies.--Upon request of the 
        Chairperson of the Committee, the head of any department or 
        agency of the United States shall furnish such information to 
        the Committee as the Committee considers to be necessary to 
        carry out its duties.
          (3) Use of mails.--The Committee may use the United States 
        mails in the same manner and under the same conditions as other 
        departments and agencies of the United States.
          (4) Gifts.--The Committee may accept, use, and dispose of 
        gifts or donations of services or property.
  (e) Meetings.--
          (1) In general.--The Committee shall meet, not less than 
        three times per year, at the call of the Chairperson or at the 
        request of the Administrator.
          (2) Location.--Each meeting of the full Committee shall be 
        held at the headquarters of the Small Business Administration 
        located in Washington, District of Columbia. The Administrator 
        shall provide suitable meeting facilities and such 
        administrative support as may be necessary for each full 
        meeting of the Committee.
          (3) Task groups.--The Committee may, from time to time, 
        establish temporary task groups as may be necessary in order to 
        carry out its duties.
  (f) Compensation and Expenses.--
          (1) No compensation.--Members of the Committee shall serve 
        without compensation for their service to the Committee.
          (2) Expenses.--The members of the Committee shall be 
        reimbursed for travel and subsistence expenses in accordance 
        with section 5703 of title 5, United States Code.
  (g) Report.--Not later than 30 days after the end of each fiscal year 
beginning after the date of enactment of this section, the Committee 
shall transmit to Congress and the President a report describing the 
activities of the Committee and any recommendations developed by the 
Committee for the promotion of small business concerns owned and 
controlled by veterans.
  (h) Termination.--The Committee shall terminate its business on 
September 30, 2004.

                    TITLE III--TECHNICAL ASSISTANCE

SEC. 301. SCORE PROGRAM.

  (a) In General.--The Administrator of the Small Business 
Administration shall enter into a memorandum of understanding with the 
Service Core of Retired Executives (described in section 8(b)(1)(B) of 
the Small Business Act (15 U.S.C. 637(b)(1)(B)) and in this section 
referred to as ``SCORE'') to provide for the following:
          (1) The appointment by SCORE in its national office of an 
        individual to act as National Veterans Business Coordinator, 
        whose duties shall relate exclusively to veterans business 
        matters, and who shall be responsible for the establishment and 
        administration of a program to coordinate counseling and 
        training regarding entrepreneurship to veterans through the 
        chapters of SCORE throughout the United States.
          (2) The assistance of SCORE in the establishing and 
        maintaining a toll-free telephone number and an Internet 
        website to provide access for veterans to information about the 
        counseling and training regarding entrepreneurship available to 
        veterans through SCORE.
          (3) The collection of statistics concerning services provided 
        by SCORE to veterans, including service-disabled veterans, for 
        inclusion in each annual report published by the Administrator 
        under section 4(b)(2)(B) of the Small Business Act (15 U.S.C. 
        633(b)(2)(B)).
  (b) Resources.--The Administrator shall provide to SCORE such 
resources as the Administrator determines necessary for SCORE to carry 
out the requirements of the memorandum of understanding specified in 
paragraph (1).

SEC. 302. ENTREPRENEURIAL ASSISTANCE.

  Not later than 180 days after the date of enactment of this Act, the 
Secretary of Veterans Affairs, the Administrator of the Small Business 
Administration, and the head of the association formed pursuant to 
section 21(a)(3)(A) of the Small Business Act (15 U.S.C. 648(a)(3)(A)) 
shall enter into a memorandum of understanding with respect to 
entrepreneurial assistance to veterans, including service-disabled 
veterans, through Small Business Development Centers (described in 
section 21 of the Small Business Act (15 U.S.C. 648)) and facilities of 
the Department of Veterans Affairs. Such assistance shall include the 
following:
          (1) Conducting of studies and research, and the distribution 
        of information generated by such studies and research, on the 
        formation, management, financing, marketing, and operation of 
        small business concerns by veterans.
          (2) Provision of training and counseling to veterans 
        concerning the formation, management, financing, marketing, and 
        operation of small business concerns.
          (3) Provision of management and technical assistance to the 
        owners and operators of small business concerns regarding 
        international markets, the promotion of exports, and the 
        transfer of technology.
          (4) Provision of assistance and information to veterans 
        regarding procurement opportunities with Federal, State, and 
        local agencies, especially such agencies funded in whole or in 
        part with Federal funds.
          (5) Establishment of an information clearinghouse to collect 
        and distribute information, including by electronic means, on 
        the assistance programs of Federal, State, and local 
        governments, and of the private sector, including information 
        on office locations, key personnel, telephone numbers, mail and 
        electronic addresses, and contracting and subcontracting 
        opportunities.
          (6) Provision of Internet or other distance learning academic 
        instruction for veterans in business subjects, including 
        accounting, marketing, and business fundamentals.
          (7) Compilation of a list of small business concerns owned 
        and controlled by service-disabled veterans that provide 
        products or services that could be procured by the United 
        States and delivery of such list to each department and agency 
        of the United States. Such list shall be delivered in hard copy 
        and electronic form and shall include the name and address of 
        each such small business concern and the products or services 
        that it provides.

SEC. 303. BUSINESS DEVELOPMENT AND MANAGEMENT ASSISTANCE FOR MILITARY 
                    RESERVISTS' SMALL BUSINESSES.

  (a) In General.--Section 8 of the Small Business Act (15 U.S.C. 637) 
is amended by adding at the end the following:
  ``(l) Management Assistance for Small Businesses Affected by Military 
Operations.--The Administration shall utilize, as appropriate, its 
entrepreneurial development and management assistance programs, 
including programs involving State or private sector partners, to 
provide business counseling and training to any small business concern 
adversely affected by the deployment of units of the Armed Forces of 
the United States in support of a period of military conflict (as 
defined in section 7(n)(1)).''.
  (b) Enhanced Publicity During Operation Allied Force.--For the 
duration of Operation Allied Force and for 120 days thereafter, the 
Administration shall enhance its publicity of the availability of 
assistance provided pursuant to the amendment made by this section, 
including information regarding the appropriate local office at which 
affected small businesses may seek such assistance.
  (c) Guidelines.--Not later than 30 days after the date of enactment 
of this section, the Administrator of the Small Business Administration 
shall issue such guidelines as the Administrator determines to be 
necessary to carry out this section and the amendment made by this 
section.

                     TITLE IV--FINANCIAL ASSISTANCE

SEC. 401. GENERAL BUSINESS LOAN PROGRAM.

  (a) Definition of Handicapped Individual.--Section 3(f) of the Small 
Business Act (15 U.S.C. 632(f)) is amended to read as follows:
  ``(f) For purposes of section 7 of this Act, the term `handicapped 
individual' means an individual--
          ``(1) who has a physical, mental, or emotional impairment, 
        defect, ailment, disease, or disability of a permanent nature 
        which in any way limits the selection of any type of employment 
        for which the person would otherwise be qualified or 
        qualifiable; or
          ``(2) who is a service-disabled veteran.''.
  (b) Authorization To Make Loans.--Section 7(a)(10) of the Small 
Business Act (15 U.S.C. 636(a)(10)) is amended--
          (1) by inserting ``guaranteed'' after ``provide''; and
          (2) by inserting, ``, including service-disabled veterans,'' 
        after ``handicapped individual''.

SEC. 402. ASSISTANCE TO ACTIVE DUTY MILITARY RESERVISTS.

  (a) Repayment Deferral for Active Duty Reservists.--Section 7 of the 
Small Business Act (15 U.S.C. 636) is amended by adding at the end the 
following:
  ``(n) Repayment Deferred for Active Duty Reservists.--
          ``(1) Definitions.--In this subsection:
                  ``(A) Eligible reservist.--The term `eligible 
                reservist' means a member of a reserve component of the 
                Armed Forces ordered to active duty during a period of 
                military conflict.
                  ``(B) Essential employee.--The term `essential 
                employee' means an individual who is employed by a 
                small business concern and whose managerial or 
                technical expertise is critical to the successful day-
                to-day operations of that small business concern.
                  ``(C) Period of military conflict.--The term `period 
                of military conflict' means--
                          ``(i) a period of war declared by Congress;
                          ``(ii) a period of national emergency 
                        declared by Congress or by the President; or
                          ``(iii) a period of a contingency operation, 
                        as defined in section 101(a) of title 10, 
                        United States Code.
                  ``(D) Qualified borrower.--The term `qualified 
                borrower' means--
                          ``(i) an individual who is an eligible 
                        reservist and who received a direct loan under 
                        subsection (a) or (b) before being ordered to 
                        active duty; or
                          ``(ii) a small business concern that received 
                        a direct loan under subsection (a) or (b) 
                        before an eligible reservist, who is an 
                        essential employee, was ordered to active duty.
          ``(2) Deferral of direct loans.--
                  ``(A) In general.--The Administration shall, upon 
                written request, defer repayment of principal and 
                interest due on a direct loan made under subsection (a) 
                or (b), if such loan was incurred by a qualified 
                borrower.
                  ``(B) Period of deferral.--The period of deferral for 
                repayment under this paragraph shall begin on the date 
                on which the eligible reservist is ordered to active 
                duty and shall terminate on the date that is 180 days 
                after the date such eligible reservist is discharged or 
                released from active duty.
                  ``(C) Interest rate reduction during deferral.--
                Notwithstanding any other provision of law, during the 
                period of deferral described in subparagraph (B), the 
                Administration may, in its discretion, reduce the 
                interest rate on any loan qualifying for a deferral 
                under this paragraph.
          ``(3) Deferral of loan guarantees and other financings.--The 
        Administration shall--
                  ``(A) encourage intermediaries participating in the 
                program under subsection (m) to defer repayment of a 
                loan made with proceeds made available under that 
                subsection, if such loan was incurred by a small 
                business concern that is eligible to apply for 
                assistance under subsection (b)(3); and
                  ``(B) not later than 30 days after the date of 
                enactment of this subsection, establish guidelines to--
                          ``(i) encourage lenders and other 
                        intermediaries to defer repayment of, or 
                        provide other relief relating to, loan 
                        guarantees under subsection (a) and financings 
                        under section 504 of the Small Business 
                        Investment Act of 1958 that were incurred by 
                        small business concerns that are eligible to 
                        apply for assistance under subsection (b)(3), 
                        and loan guarantees provided under subsection 
                        (m) if the intermediary provides relief to a 
                        small business concern under this paragraph; 
                        and
                          ``(ii) implement a program to provide for the 
                        deferral of repayment or other relief to any 
                        intermediary providing relief to a small 
                        business borrower under this paragraph.''.
  (b) Disaster Loan Assistance for Military Reservists' Small 
Businesses.--Section 7(b) of the Small Business Act (15 U.S.C. 636(b)) 
is amended by inserting after the undesignated paragraph that begins 
with ``Provided, That no loan'', the following:
          ``(3)(A) In this paragraph--
                  ``(i) the term `essential employee' means an 
                individual who is employed by a small business concern 
                and whose managerial or technical expertise is critical 
                to the successful day-to-day operations of that small 
                business concern;
                  ``(ii) the term `period of military conflict' has the 
                meaning given the term in subsection (n)(1); and
                  ``(iii) the term `substantial economic injury' means 
                an economic harm to a business concern that results in 
                the inability of the business concern--
                          ``(I) to meet its obligations as they mature;
                          ``(II) to pay its ordinary and necessary 
                        operating expenses; or
                          ``(III) to market, produce, or provide a 
                        product or service ordinarily marketed, 
                        produced, or provided by the business concern.
          ``(B) The Administration may make such disaster loans (either 
        directly or in cooperation with banks or other lending 
        institutions through agreements to participate on an immediate 
        or deferred basis) to assist a small business concern that has 
        suffered or that is likely to suffer substantial economic 
        injury as the result of an essential employee of such small 
        business concern being ordered to active military duty during a 
        period of military conflict.
          ``(C) A small business concern described in subparagraph (B) 
        shall be eligible to apply for assistance under this paragraph 
        during the period beginning on the date on which the essential 
        employee is ordered to active duty and ending on the date that 
        is 90 days after the date on which such essential employee is 
        discharged or released from active duty.
          ``(D) Any loan or guarantee extended pursuant to this 
        paragraph shall be made at the same interest rate as economic 
        injury loans under paragraph (2).
          ``(E) No loan may be made under this paragraph, either 
        directly or in cooperation with banks or other lending 
        institutions through agreements to participate on an immediate 
        or deferred basis, if the total amount outstanding and 
        committed to the borrower under this subsection would exceed 
        $1,500,000, unless such applicant constitutes a major source of 
        employment in its surrounding area, as determined by the 
        Administration, in which case the Administration, in its 
        discretion, may waive the $1,500,000 limitation.
          ``(F) For purposes of assistance under this paragraph, no 
        declaration of a disaster area shall be required.''.
  (c) Enhanced Publicity During Operation Allied Force.--For the 
duration of Operation Allied Force and for 120 days thereafter, the 
Administration shall enhance its publicity of the availability of 
assistance provided pursuant to the amendments made by this section, 
including information regarding the appropriate local office at which 
affected small businesses may seek such assistance.
  (d) Guidelines.--Not later than 30 days after the date of enactment 
of this section, the Administrator of the Small Business Administration 
shall issue such guidelines as the Administrator determines to be 
necessary to carry out this section and the amendments made by this 
section.
  (e) Effective Dates.--
          (1) In general.--Except as provided in paragraph (2), the 
        amendments made by this section shall take effect on the date 
        of the enactment of this section.
          (2) Disaster loans.--The amendments made by subsection (b) 
        shall apply to economic injury suffered or likely to be 
        suffered as the result of a period of military conflict 
        occurring or ending on or after March 24, 1999.

SEC. 403. MICROLOAN PROGRAM.

  Section 7(m)(1)(A)(i) of the Small Business Act (15 U.S.C. 
636(m)(1)(A)(i)) is amended by inserting ``veteran (within the meaning 
of such term under section 3(q)),'' after ``low-income,''.

SEC. 404. DELTA LOAN PROGRAM.

  Section 7(a)(21)(A) Small Business Act (15 U.S.C. 636(a)(21)(A)) is 
amended in subclause (ii) by inserting ``or a veteran'' after 
``qualified individual''.

SEC. 405. STATE DEVELOPMENT COMPANY PROGRAM.

  Section 501(d)(3) of the Small Business Investment Act (15 U.S.C. 
695(d)(3)) is amended--
          (1) by redesignating subparagraphs (E), (F), and (G) as 
        subparagraphs (F), (G), and (H), respectively; and
          (2) by inserting after subparagraph (D) the following:
                  ``(E) expansion of small business concerns owned and 
                controlled by veterans, as defined in section 3(q) of 
                the Small Business Act (15 U.S.C. 632(q)), especially 
                service-disabled veterans, as defined in such section 
                3(q),''.

                    TITLE V--PROCUREMENT ASSISTANCE

SEC. 501. SUBCONTRACTING.

  (a) Statement of Policy.--Section 8(d)(1) of the Small Business Act 
(15 U.S.C. 637(d)(1)) is amended by inserting ``small business concerns 
owned and controlled by service-disabled veterans,'' after ``small 
business concerns,'' the first place it appears in the first and second 
sentences.
  (b) Contract Clause.--The contract clause specified in section 
8(d)(3) of the Small Business Act (15 U.S.C. 637(d)(3)) is amended as 
follows:
          (1) Subparagraph (A) of such clause is amended by inserting 
        ``small business concerns owned and controlled by veterans,'' 
        after ``small business concerns,'' the first place it appears 
        in the first and second sentences.
          (2) Subparagraphs (E) and (F) of such clause are redesignated 
        as subparagraphs (F) and (G), respectively, and the following 
        new subparagraph is inserted after subparagraph (D) of such 
        clause:
          ``(E) The term `small business concern owned and controlled 
        by veterans' shall mean a small business concern--
                  ``(i) which is at least 51 per centum owned by one or 
                more eligible veterans; or, in the case of any publicly 
                owned business, at least 51 per centum of the stock of 
                which is owned by one or more veterans; and
                  ``(ii) whose management and daily business operations 
                are controlled by such veterans. The contractor shall 
                treat as veterans all individuals who are veterans 
                within the meaning of the term under section 3(q) of 
                the Small Business Act.''.
          (3) Subparagraph (F) of such clause, as redesignated by 
        paragraph (2) of this subsection, is amended by inserting 
        ``small business concern owned and controlled by veterans,'' 
        after ``small business concern,'' the first place it appears.
  (c) Conforming Amendments.--Section 8(d) of the Small Business Act 
(15 U.S.C. 637(d)) is further amended by inserting ``small business 
concerns owned and controlled by veterans,'' after ``small business 
concerns,'' the first place it appears in paragraphs (4)(D), (4)(E), 
(6)(A), (6)(C), (6)(F), and (10)(B).

SEC. 502. PARTICIPATION IN FEDERAL PROCUREMENT.

  (a) Government-Wide Participation Goals.--Subsection (g)(1) of 
section 15 of the Small Business Act (15 U.S.C. 644) is amended--
          (1) in the first sentence, by inserting ``small business 
        concerns owned and controlled by service disabled veterans,'' 
        after ``small business concerns,'' the first place it appears;
          (2) by inserting after the second sentence, the following: 
        ``The Government-wide goal for participation by small business 
        concerns owned and controlled by service-disabled veterans 
        shall be established at not less than 5 percent of the total 
        value of all prime contract and subcontract awards for each 
        fiscal year.''; and
          (3) in the second to last sentence, by inserting ``small 
        business concerns owned and controlled by service-disabled 
        veterans,'' after ``small business concerns,'' the first place 
        it appears.
  (b) Agency Participation Goals.--Subsection (g)(2) of section 15 of 
the Small Business Act (15 U.S.C. 644) is amended--
          (1) in the first sentence, by inserting ``by small business 
        concerns owned and controlled by service-disabled veterans,'' 
        after ``small business concerns,''; the first place it appears;
          (2) in the second sentence, by inserting ``small business 
        concerns owned and controlled by service-disabled veterans,'' 
        after ``small business concerns,'' the first place it appears; 
        and
          (3) in the fourth sentence, by inserting ``small business 
        concerns owned and controlled by service-disabled veterans, 
        by'' after ``including participation by''.

                 TITLE VI--REPORTS AND DATA COLLECTION

SEC. 601. REPORTING REQUIREMENTS.

  (a) Reports to Small Business Administration.--Subsection (h)(1) of 
section 15 of the Small Business Act (15 U.S.C. 644) is amended by 
inserting ``small business concerns owned and controlled by veterans 
(including service-disabled veterans),'' after ``small business 
concerns,'' the first place it appears.
  (b) Reports to the President and Congress.--Subsection (h)(2) of 
section 15 of the Small Business Act (15 U.S.C. 644) is amended--
          (1) by inserting ``and Congress'' before the period at the 
        end of first sentence; and
          (2) in subparagraphs (A), (D), and (E), by inserting ``small 
        business concerns owned and controlled by service-disabled 
        veterans,'' after ``small business concerns,'' the first place 
        it appears.

SEC. 602. REPORT ON SMALL BUSINESS AND COMPETITION.

  Section 303(e) of the Small Business Economic Policy Act of 1980 (15 
U.S.C. 631b(e)) is amended--
          (1) in paragraph (1), by striking ``and'' after the 
        semicolon;
          (2) in paragraph (2), by striking the period at the end and 
        inserting ``; and''; and
          (3) by adding at the end the following:
          ``(3) small business concerns owned and controlled by 
        veterans, as defined in section 3(q) of the Small Business Act 
        (15 U.S.C. 632(q)), and small business concerns owned and 
        controlled by service-disabled veterans, as defined in such 
        section 3(q).''.

SEC. 603. ANNUAL REPORT OF THE ADMINISTRATOR.

  The Administrator of the Small Business Administration shall transmit 
annually to the Committees on Small Business and Veterans Affairs of 
the House of Representatives and the Senate a report on the needs of 
small business concerns owned and controlled by veterans and small 
business concerns owned and controlled by service-disabled veterans, 
which shall include information on--
          (1) the availability of Small Business Administration 
        programs for such small business concerns and the degree of 
        utilization of such programs by such small business concerns 
        during the preceding 12-month period, including statistical 
        information on such utilization as compared to the small 
        business community as a whole;
          (2) the percentage and dollar value of Federal contracts 
        awarded to such small business concerns during the preceding 
        12-month period; and
          (3) proposals to improve the access of such small business 
        concerns to the assistance made available by the United States.

SEC. 604. DATA AND INFORMATION COLLECTION.

  (a) Information on Federal Procurement Practices.--The Administrator 
of the Small Business Administration shall, for each fiscal year--
          (1) collect information concerning the procurement practices 
        and procedures of each department and agency of the United 
        States having procurement authority;
          (2) publish and disseminate such information to procurement 
        officers in all Federal agencies; and
          (3) make such information available to any small business 
        concern requesting such information.
  (b) Identification of Small Business Concerns Owned by Eligible 
Veterans.--Each fiscal year, the Secretary of Veterans Affairs shall, 
in consultation with the Assistant Secretary of Labor for Veterans' 
Employment and Training and the Administrator of the Small Business 
Administration, identify small business concerns owned and controlled 
by veterans in the United States. The Secretary shall inform each small 
business concern identified under this paragraph that information on 
Federal procurement is available from the Administrator.
  (c) Self-Employment Opportunities.--The Secretary of Labor, the 
Secretary of Veterans Affairs, and the Administrator of the Small 
Business Administration shall enter into a memorandum of understanding 
to provide for coordination of vocational rehabilitation services, 
technical and managerial assistance, and financial assistance to 
veterans, including service-disabled veterans, seeking to employ 
themselves by forming or expanding small business concerns. The 
memorandum of understanding shall include recommendations for expanding 
existing programs or establishing new programs to provide such services 
or assistance to such veterans.

                  TITLE VII--MISCELLANEOUS PROVISIONS

SEC. 701. ADMINISTRATOR'S ORDER.

  The Administrator of the Small Business Administration shall 
strengthen and reissue the Administrator's order regarding the 3d 
sentence of section 4(b)(1) of the Small Business Act (15 U.S.C. 
633(b)(1)), relating to nondiscrimination and special considerations 
for veterans, and take all necessary steps to ensure that its 
provisions are fully and vigorously implemented.

SEC. 702. SMALL BUSINESS ADMINISTRATION OFFICE OF ADVOCACY.

  Section 202 of Public Law 94-305 (15 U.S.C. 634b) is amended--
          (1) in paragraph (10), by striking ``and'' at the end;
          (2) in paragraph (11), by striking the period at the end and 
        inserting ``; and''; and
          (3) by adding at the end the following:
          ``(12) evaluate the efforts of each department and agency of 
        the United States, and of private industry, to assist small 
        business concerns owned and controlled by veterans, as defined 
        in section 3(q) of the Small Business Act (15 U.S.C. 632(q)), 
        and small business concerns owned and controlled by serviced-
        disabled veterans, as defined in such section 3(q), and to 
        provide statistical information on the utilization of such 
        programs by such small business concerns, and to make 
        appropriate recommendations to the Administrator of the Small 
        Business Administration and to Congress in order to promote the 
        establishment and growth of those small business concerns.''.

SEC. 703. STUDY OF FIXED-ASSET SMALL BUSINESS LOANS.

  (a)  In General.--The Comptroller General shall conduct a study on 
whether there would exist any additional risk or cost to the United 
States if--
          (1) up to 10 percent of the loans guaranteed under chapter 37 
        of title 38, United States Code, were made for the acquisition 
        or construction of fixed assets used in a trade or business 
        rather than for the construction or purchase of residential 
        buildings; and
          (2) such loans for acquisition or construction of fixed 
        assets were for a term of not more than 10 years and the terms 
        regarding eligibility, loan limits, interest, fees, and down 
        payment were the same as for other loans guaranteed under such 
        chapter.
  (b) Report.--
          (1) In general.--Not later than 180 days after the enactment 
        of this Act, the Comptroller General shall transmit the report 
        described in subsection (a) to the Committees on Veterans' 
        Affairs and the Committees on Small Business of the House of 
        Representatives and the Senate.
          (2) Contents of report.--The report required by paragraph (1) 
        shall specifically address the following:
                  (A) With respect to the change in the veterans' 
                housing loan program contemplated under subsection (a):
                          (i) The increase or decrease in 
                        administrative costs to the Department of 
                        Veterans Affairs.
                          (ii) The increase or decrease in the degree 
                        of exposure of the United States as the 
                        guarantor of the loans.
                          (iii) The increase or decrease in the Federal 
                        subsidy rate that would be possible.
                          (iv) Any increase in the interest rate or 
                        fees charged to the borrower or lender that 
                        would be required to maintain present program 
                        costs.
                  (B) Information regarding the delinquency rates, 
                default rates, length of time required for recovery 
                after default, for fixed-asset business loans, of a 
                size and duration comparable to those contemplated 
                under subsection (a), made available in the private 
                market or under section 503 of the Small Business 
                Investment Act.

                                Purpose

    The purpose of H.R. 1568 is to provide assistance to 
veteran owned businesses, particularly service-disabled veteran 
owned businesses, in order to enable them to form and expand 
small businesses. H.R. 1568 will accomplish this through four 
primary changes in the Small Business Act.
    First, the bill establishes the National Veterans Business 
Development Corporation (NVBDC), a federally chartered 
corporation empowered to establish a nationwide network of 
veterans business assistance centers, and to work with both 
public and private organizations to provide assistance and 
mentoring to veterans. The Corporation will have a 
Presidentially appointed Board of Directors and shall receive 
four years of federal funding for start-up costs.
    Second H.R. 1568 clarifies and re-emphasizes the 
responsibility of the Small Business Administration (SBA) to 
reach out to and include veterans in its programs providing 
financial and technical assistance. The bill specifically 
includes veterans as a target group for the SBA's 7(a), 504 and 
microloan programs. It also requires the SBA's SCORE and Small 
Business Development Center programs to work with the NVBDC to 
expand technical assistance for veteran entrepreneurs.
    Third, H.R. 1568 provides service-disabled veterans, those 
who have scarified their health and strength for the Nation, a 
five percent goal in federal procurements. This goal is 
designed to raise the awareness of federal procurement 
officials and help provide service-disabled veterans with 
access to federal procurement opportunities.
    Fourth, H.R. 1568 establishes a program to assist self-
employed and small business owning military reservists who are 
called to active duty. The bill provides them with access to 
economic injury disaster loans and requires the Administrator 
of the SBA to establish a system for the deferral of 
outstanding loans.

                          Need for Legislation

    Over the years, the Nation has recognized the debt owned to 
citizens who serve in defense of our Constitution and the 
American ideals of free speech, personal liberty, and free 
enterprise. H.R. 1568 builds on the best examples of this 
public policy from our Nation's history. From the beginning of 
the Republic, when the Continental Congress provided land 
grants to Revolutionary War veterans, we have helped veterans 
with self-employment and self-sufficiency. 150 years later, the 
1944 Servicemen's Readjustment Act, or ``G.I. Bill of Rights of 
World War II'' provided loan guarantees for returning World War 
II, and later Korean War, veterans. In the ten years following, 
the Federal Government provided over 280,000 small business and 
farm loans to veterans to help include them in the post-war 
boom and use their talents to propel that boom.
    Unfortunately, the Nation's efforts on behalf of veterans 
have diminished drastically in the intervening 45 years. Over 
the years, the interests of veterans, particularly the service-
disabled, have fallen on infertile ground. While specifically 
included as a priority of the SBA at its creation, the Office 
of Veterans Affairs and the needs of veterans have been 
diminished systematically at the SBA. Elimination of the direct 
loan program for veterans in fiscal year 1995, at then 
Administrator Phil Lader's request, resulted in serious 
dimunition of financial assistance for veterans. Total loan 
dollars dropped from $22 million dollars in loans in 1993 to 
$10.8 million in 1998. Likewide, training and counseling for 
veterans dropped from 38,775 total counseling sessions for 
veterans in 1993 to 29,821 sessions in 1998.
    While the current SBA Administrator, Aida Alvarez, has made 
efforts to halt this slide it is evident that more must be 
done. Teamwork and self-confidence are the hallmarks of our 
veterans. With that in mind. H.R. 1568 proposes to give 
veterans the tools they need to do the job. SBA's activities 
and priorities will be strengthened, but a framework must be 
established to allow veterans and small businesses share their 
knowledge and skills. By establishing the National Veterans 
Business Development Corporation, Congress will set in place a 
permanent mechanism for meeting our obligations to our service 
men and women.
    H.R. 1568 will also fulfill a long unmet need to assist our 
military reservists who are small business owners. Often these 
individuals, called to service at short notice, come back from 
fighting to protect our freedoms only to find their businesses 
in shambles. H.R. 1568 will establish loan deferrals, technical 
and managerial assistance, and loan programs for these citizen 
soldiers so that while they risk their lives they need not risk 
their livelihoods.

                            Committee Action

    On June 23, 1999, at 9:30 a.m., the Committee on Small 
Business convened a hearing to discuss the provisions of H.R. 
1568. The Committee received testimony from eight witnesses. In 
the first panel, one Administration witness and four veterans 
and veteran representatives discussed H.R. 1568's ability to 
satisfy veterans' recognized need to access capital and 
employment markets. The second panel included three business 
community representatives who discussed the community's 
willingness to support H.R. 1568's National Veterans Business 
Development Corporation.
    Ms. Betsy Myers, Associate Deputy Administrator for 
Entrepreneurial Development, U.S. Small Business 
Administration, discussed the July 1998 Small Business 
Administration (SBA) Veterans' Affairs Task Force for 
Entrepreneurship and its November 1998 ``high priority'' 
recommendations. Under questioning from Chairman Talent, Ms. 
Myers acknowledged H.R. 1568 incorporates the Task Force's 
``high priority'' recommendations. Furthermore, Ms. Myers 
agreed with SBA's chief financial officer's comment that SBA 
has spent little on veterans' affairs in the past and that SBA 
is just now reaching out more. Decreased Veterans' Affairs 
program funding--$1.4 million in 1998 to $340,000 in 1997--
supports this assessment.
    Mr. Anthony Baskerville, Deputy National Service Director 
for Employment for the Disabled American Veterans, testified 
that H.R. 1568 ``is a comprehensive approach to encouraging 
entrepreneurship among veterans through loans and a variety of 
support and technical assistance, assistance which veterans so 
richly deserve.'' H.R. 1568 increases veterans likelihood of 
self-employment because it stresses their military training 
that ``imparts discipline, a need for independence, autonomy, 
and power, and a greater tolerance for risk-taking.'' As a 
result, Mr. Baskerville and the Disabled American Veterans 
support H.R. 1568.
    Ms. Valerie Callaway, a disabled retired veteran, testified 
that veterans need H.R. 1568 to successfully establish small 
businesses. Ms. Callaway testified that she suffered heart 
failure while on active service and received a medical 
discharge. Her disability and the delay in Veterans' Affairs 
Vocational Rehabilitation services inhibited her employment 
opportunities. In order to care for her three children, she 
decided to operate a daycare center for military personnel from 
her home. However, she lacked a stable residency history due to 
military service and could not obtain a loan. Ms. Callaway 
acknowledged in questioning from Mr. Forbes that she turned to 
the SBA for assistance, but fond no program that adequately 
served her needs or a website that provided any information. 
Ms. Callaway invested $25,000 of her money and tried to start 
her business. Unfortunately, nine months later the business 
failed.
    John Lopez, Chairman of the Association for Service 
Disabled Veterans, testified that assistance for veterans is 
overdue. The individuals that protected America's freedoms are 
aging, dying and unable to enjoy these freedoms. In response to 
Mr. Forbes's questions, Mr. Lopez cited decreased spending and 
SBA's inability to provide a veterans representative at each 
facility as evidence that SBA abandoned veterans. Mr. Lopez 
commended Ms. Napolitano for her efforts in the California 
General Assembly in securing some veterans' assistance. Mr. 
Pascrell agreed with Mr. Lapez and noted that few veterans know 
what assistance exists and where to obtain it. H.R. 1568's 
corporation enables veterans to reach out to other veterans.
    Finally, Emil Naschinski from the American Legion concluded 
the first panel's testimony. Mr. Naschinski also noted SBA's 
failure to support veterans groups. Mr. Naschinski believed 
that H.R. 1568 advances veterans' causes. However, he expressed 
some funding concerns. He noted that previous Congresses passed 
necessary legislation that lacked requisite funding. H.R. 1568, 
Mr. Naschinski noted, appropriates $12 million over four years, 
but makes no funding assurances. However, Chairman Talent and 
Mr. Pascrell both assured Mr. Naschinski that the Committee on 
Appropriations supports this bill and will fund it.
    Mr. Bill Elmore, Data Force Associates, testified in the 
second panel that the business community supports the bill. Mr. 
Elmore cited the National Veterans Business Development 
Corporation as H.R. 1568's most importation and innovative 
feature. ``It places the responsibility for initiative squarely 
in the hands of the veterans and the business community.'' Mr. 
Elmore expressed concern that the Corporation's board would be 
too political. He suggested that the chairman and ranking 
member of the House and Senate Committees on Small Business and 
Veterans' Affairs play a larger role in choosing the board 
members. Chairman Talent assured Mr. Elmore that he believed 
both the chairman and ranking member from each committee would 
choose individuals focused on veterans' concerns.
    Mr. Charles Foster, Group President for SBC Communications, 
testified that business will support the National Veterans 
Business Development Corporation. ``SBC's Pacific Bell 
subsidiary leads the industry with 30 percent of procurement 
dollars going to diversity suppliers and more than $40 million 
of that goes to disabled veteran-owned businesses.'' Mr. Foster 
acknowledged that SBC Communications cannot guarantee 5% of its 
contracts to veterans. SBC Communications' current goal is 
1.5%. Its studies show that there are insufficient veteran-
owned companies able to serve its needs. In response to 
questions from Ms. Napolitano and Mr. Davis, Mr. Foster 
acknowledged that a 5% goal might be attainable at some future 
time.
    Finally, Stephen H. White, President, White & Co., 
testified the National Veterans Business Development 
Corporation provides a network that assists small businesses 
and veterans. Mr. White testified that there exists a ``Vet 
Connection'' in which veteran business owners and executives 
express a desire to work with or purchase from other veterans, 
hire other veterans, network with other veteran business 
owners, and train veterans. The National Veterans Business 
Development Corporation provides a veteran assistance focal 
point.

                       consideration of h.r. 1568

    At 11 a.m. on June 23, 1999, the Committee on Small 
Business met to mark up and report H.R. 1568. The Chairman 
declared the bill open for amendment by title, and the first 
action was consideration of an en bloc amendment offered by 
Chairman Talent. The amendment had four parts: (1) an amendment 
to Sections 202 and 203 setting a sunset date for the Advisory 
Committee on Veterans and transferring its responsibilities to 
the National Veterans Business Development Corporation, (2) an 
amendment to Section 202 requiring the National Veterans 
Business Development Corporation to establish an advisory board 
to study the coordination and harmonization of private sector 
certification with military technical training, (3) a technical 
correction to section 401, and (4) a technical correction to 
Section 405. The amendment was accepted by a unanimous voice 
vote.
    The next amendment was offered by Mr. Phelps and consisted 
of the text of his bill H.R. 1614, the companion to Senator 
Kerry's bill, S. 918. This amendment would establish a program 
to assist small business owners and self-employed individuals 
who are military reservists and are called to active duty. The 
Chairman, Mr. Talent, and the Ranking Member, Ms. Velazquez, 
both expressed their strong support for the amendment and it 
was accepted by a unanimous voice vote.
    The final amendment was offered by Mrs. Kelly, for herself 
and Mr. Forbes. It amended several of the reporting provisions 
in Sections 601, 603, and 702 to require the SBA to provide 
statistical breakdowns of veteran participation in SBA 
programs, and to require the SBA to provide information on 
veteran participation in federal procurement to procurement 
officers. The amendment was accepted by a unanimous voice vote.
    Ms. Millender-McDonald then moved the bill be reported, and 
at 11:35 a.m., by unanimous voice vote, a quorum being present, 
the Committee passed H.R. 1568, as amended, and ordered it 
reported.

                      Section-by-Section Analysis


                         section 1. short title

    Designates the bill as the ``Veterans Entrepreneurship and 
Small Business Development Act of 1999''.

                      section 2. table of contents

                      TITLE I--GENERAL PROVISIONS


                         section 101. findings

    This section describes Congressional findings regarding the 
sacrifices and efforts of veterans and their value to the 
American economy as small business owners.

                          section 102. purpose

    Describes the purpose of the Act, to encourage the SBA and 
other agencies to implement further efforts to assist veterans, 
particularly service-disabled veterans in the formation and 
growth of small businesses.

                        section 103. definitions

    Establishes definitions of veteran owned and service-
disabled veteran owned small business concerns. The term 
``service-disabled veterans'' is based on the definition in 
Title 38 of the U.S. Code.

                TITLE II--VETERANS BUSINESS DEVELOPMENT


          SECTION 201. OFFICE OF VETERANS BUSINESS DEVELOPMENT

    Establishes an Office of Veterans Business Development and 
the position of Associate Administrator for Veterans Business 
Development at the Small Business Administration. This position 
will be responsible for the formulation, execution, and 
promotion of programs to provide assistance for small 
businesses owned and controlled by veterans. There are 
currently at least ten Associate Administrators at the SBA. A 
minimum of four are required by law, and the titles of only two 
are specified.

    SECTION 202. NATIONAL VETERANS BUSINESS DEVELOPMENT CORPORATION

    This section establishes a federally chartered corporation, 
the National Veterans Business Development Corporation, for the 
purpose of guiding and monitoring public and private sector 
initiatives to assist the Nation's veterans in their efforts to 
form and grow small businesses. The most significant single 
purpose of the corporation will be to work with the public and 
private sectors to establish an independent nationwide network 
of business assistance and information centers for veterans. 
The Corporation will be managed by a Board of Directors 
appointed in a bipartisan fashion by the President based on 
recommendations from the Congress. It will have the power to 
raise and disburse funds, establish initiatives, and award 
grants in furtherance of its goal of establishing a cohesive 
assistance and information network for veteran owned business.
    The NVBDC will also establish an advisory board on 
professional certification to work on the problems service 
members with military technical training face in transitioning 
into the private sector workforce. The board will be composed 
of representatives of professional certification organizations, 
such as the Coalition for Professional Certification and 
veterans organizations such as the American Legion. In 
addition, the Board of Directors of the NVBDC shall invite 
representatives of the Armed Services and the Department of 
Labor to participate.
    While they will have no mandate to change or enforce 
regulations, the Committee hopes that the military and private 
sector will work in a cooperative fashion to satisfy both the 
Armed Services training requirements and the public sector's 
need for standard certification and provide transitioning 
servicemembers with an easy entrance to civilian life.
    To start the NVBDC it will have an initial authorization of 
$2 million in the first year and $4 million in the second, and 
third years, dropping back to $2 million in the fourth and 
final year. After the fourth year the Corporation will be self 
funded from private donations and no longer be eligible for 
federal funds. The Committee has already received testimony in 
support of private funding of the NVBDC and fully expects the 
Corporation to be self supporting within four years.

          SECTION 203. ADVISORY COMMITTEE ON VETERANS AFFAIRS

    Establishes an eight member committee to provide 
independent advice and policy recommendations to the SBA, 
Congress, and the President. The committee will conduct 
hearings, collect information from federal agencies, develop, 
monitor and promote programs to aid veteran's business 
development, and issue an annual report to the Congress. The 
Committee will terminate on September 30, 2004 and its 
responsibilities will devolve onto the National Veterans 
Business Development Corporation.

                    TITLE III--TECHNICAL ASSISTANCE


                       SECTION 301. SCORE PROGRAM

    This section requires the Service Corps of Retired 
Executives (SCORE) and the SBA to establish a program for 
directing management and technical assistance to veteran-owned 
small business and veterans wishing to establish small business 
concerns. SCORE provides advice and technical assistance to 
small businesses free of charge through a nationwide network of 
volunteers.

                SECTION 302. ENTREPRENEURIAL ASSISTANCE

    This section requires the Small Business Development Center 
(SBDC) system and the SBA to establish a program for outreach 
and assistance to veterans and veteran-owned small businesses. 
SBDC's provide free management and technical assistance to 
small business owners through over 900 sites located at 
colleges and universities nationwide.

         SECTION 303. MILITARY RESERVISTS TECHNICAL ASSISTANCE

    Establishes a program of technical and managerial 
assistance, through the SBA, for military reservists who are 
self-employed or are small business owners and are called to 
active military duty. Requires the SBA to enhance its publicity 
of such assistance for the duration of Operation ``Allied 
Force''.

                     TITLE IV--FINANCIAL ASSISTANCE


                  SECTION 401. GENERAL BUSINESS LOANS

    Includes service-disabled veterans with handicapped 
individuals in provisions requiring that loan making decisions 
shall be resolved in favor of the prospective borrower. H.R. 
1568 also clarifies that this provision applies only to 
guaranteed loans and makes no requirement that the SBA 
reinstitute the direct loan programs eliminated in the 
Administration budget submission in 1995. According to the 
Administration's testimony on June 23, 1999 such a result was 
not desired by the SBA. Therefore, an amendment was offered to 
specify and reinforce the Administration's opposition to those 
programs.

       SECTION 402. ASSISTANCE TO ACTIVE DUTY MILITARY RESERVISTS

    Requires the SBA to establish a system for loan deferrals 
for small business owners called up for active duty. Also 
requires the SBA to make economic injury disaster loans 
available to self-employed individuals who are called to active 
duty for the National Guard and Reserves.

                     SECTION 403. MICROLOAN PROGRAM

    Makes veterans eligible for assistance under the SBA's 
microloan program which provides small loans (under $25,000) to 
people seeking initial financing for small business start-up or 
expansion.

                    SECTION 404. DELTA LOAN PROGRAM

    Includes veteran owned small businesses in the eligibility 
categories for assistance under the DELTA loan program at the 
SBA.

             SECTION 405. STATE DEVELOPMENT COMPANY PROGRAM

    Includes the formation and creation of veteran-owned small 
business in the public policy goals sought in the 504 loan 
program for construction and long-term equipment loans.

                          TITLE V--PROCUREMENT


                      SECTION 501. SUBCONTRACTING

    Requires the inclusion of small business concerns owned and 
controlled by veterans in the mandatory subcontracting clause 
in all government contracts that establishes subcontracting 
plans.

                  SECTION 502. PROCUREMENT ASSISTANCE

    This section requires the SBA to establish a five percent 
goal for contracting with small business concerns owned and 
controlled by service disabled veterans.

                       TITLE VI--REPORTS AND DATA


                  SECTION 601. REPORTING REQUIREMENTS

    Requires the heads of each federal agency to report to the 
Small Business Administration concerning contracting with 
veteran owned and service-disabled veteran owned small 
businesses.

         SECTION 602. REPORT ON SMALL BUSINESS AND COMPETITION

    Requires the SBA to include information on small business 
concerns owned by veterans and service disabled veterans in the 
annual report on small business participation and opportunities 
in federal procurement.

                       SECTION 603. ANNUAL REPORT

    This section requires the Administrator to submit an annual 
report to Congress on the needs of veteran owned small business 
and the progress of programs designed to aid and promote 
veterans small business ownership. The Administrator shall also 
provide statistical information on veterans participation in 
SBA programs.

                  SECTION 604. INFORMATION COLLECTION

    Requires the collection of procurement data on veterans and 
service-disabled veteran owned small businesses, and collection 
of information on the procurement practices of each federal 
agency. All such information is to be made available to any 
small business concern requesting it. The information is also 
to be distributed to federal procurement officers. Also 
requires the SBA and VA to work to establish a database on 
veteran owned small business concerns.

                  TITLE VII--MISCELLANEOUS PROVISIONS


                   SECTION 701. ADMINISTRATOR'S ORDER

    Requires the administrator to strengthen and reissue the 
order implementing the provisions of PL 93-237 which requires 
the SBA to fully include veterans in all the programs, purposes 
and activities of the agency.

                    SECTION 702. OFFICE OF ADVOCACY

    Requires the Chief Counsel for Advocacy of the US Small 
Business Administration to include an evaluation of the efforts 
of the federal government to assist veteran owned small 
business concerns as one of his primary functions. The Chief 
Counsel is also required to provide statistical information on 
veterans utilization of federal programs. Also requires the 
Chief Counsel to make recommendations to the Administrator of 
the SBA and Congress on programs and efforts to assist veteran 
owned small business concerns.

             SECTION 703. FIXED ASSET SMALL BUSINESS LOANS

    Requires the Government Accounting Office to conduct a 
study of the feasibility of using the VA home ownership loan 
program as a source of fixed asset financing for veteran-owned 
small businesses.

                                     U.S. Congress,
                               Congressional Budget Office,
                                     Washington, DC, June 29, 1999.
Hon. James M. Talent,
Chairman, Committee on Small Business,
House of Representatives, Washington, DC.
    Dear Mr. Chairman: The Congressional Budget Office has 
prepared the enclosed cost estimate for H.R. 1568, the Veterans 
Entrepreneurship and Small Business Development Act of 1999.
    If you wish further details on this estimate, we will be 
pleased to provide them. The CBO staff contacts for federal 
costs are Mark Hadley and Megan Carroll. The staff contact for 
the state and local impact is Shelley Finlayson.
            Sincerely,
                                          Barry B. Anderson
                                    (For Dan L. Crippen, Director).
    Enclosure.

               CONGRESSIONAL BUDGET OFFICE COST ESTIMATE

H.R. 1568--Veterans Entrepreneurship and Small Business Development Act 
        of 1999

    Summary: H.R. 1568 would expand federal assistance to small 
businesses owned by veterans. It would establish a federally 
chartered corporation to coordinate assistance to small 
business owners who are veterans. In addition, it would 
establish an Office of Veterans Business Development and an 
advisory committee on veterans affairs within the Small 
Business Administration (SBA). Section 402 would authorize the 
SBA to modify and expand certain loan programs to assist small 
businesses that employ military reservists who are called to 
active duty. Finally, the bill would direct the SBA and the 
General Accounting Office to prepare several reports and would 
provide other forms of assistance to small businesses that are 
owned by veterans.
    Assuming appropriation of the necessary amounts, CBO 
estimates that implementing H.R. 1568 would increase 
discretionary spending by about $24 million over the 2000-2004 
period. CBO also estimates that enacting the bill would 
increase direct spending by about $1 million in fiscal year 
1999. therefore, pay-as-you-go procedures would apply to this 
bill. H.R. 1568 contains no intergovernmental or private-sector 
mandates as defined in the Unfunded Mandates Reform Act (UMRA).
    Estimated cost to the Federal Government: For the purposes 
of this estimate, CBO assumes that H.R. 1568 will be enacted 
during fiscal year 1999. The estimated effect of H.R. 1568 on 
discretionary spending is shown in the following table. We 
estimate that modifying the terms of certain loans would 
increase direct spending by about $1 million in 1999 and that 
provisions authorizing the receipt and use of gifts and 
donations would have a negligible effect on direct spending and 
governmental receipts over the 2000-2004 period. The costs of 
this legislation fall within budget functions 370 (commerce and 
housing credit) and 450 (community and regional development).

----------------------------------------------------------------------------------------------------------------
                                                                  By fiscal years, in millions of dollars--
                                                           -----------------------------------------------------
                                                              1999     2000     2001     2002     2003     2004
----------------------------------------------------------------------------------------------------------------
                                        SPENDING SUBJECT TO APPROPRIATION

Estimated Authorization Level.............................        0        5        6        6        4        3
Estimated Outlays.........................................        0        5        6        6        4        3
----------------------------------------------------------------------------------------------------------------

Basis of Estimate

            Spending subject to appropriation
    H.R. 1568 would authorize the appropriation of $12 million 
over the 2000-2003 period for the National Veterans Business 
Development Corporation. For purposes of this estimate, CBO 
assumes that the corporation would receive and spend the entire 
amount appropriated for each year. Based on information from 
SBA, CBO estimates that implementing the other provisions of 
the bill would increase administrative costs by an additional 
$12 million over the 2000-2004 period.
    Section 402 would expand the disaster loan program to 
include small businesses that suffer substantial economic 
injury as a result of an essential employee being ordered to 
active duty during a period of military conflict. The Federal 
Credit Reform Act of 1990 requires appropriations for the 
subsidy costs and administrative costs of credit programs. The 
subsidy cost is the estimated long-term cost to the government 
of a direct loan or loan guarantee, calculated on a net present 
value basis and excluding administrative costs. Implementing 
section 402 of the bill could result in additional subsidy 
costs for making new loans. Although CBO cannot predict the 
number, timing, or extent of future military conflicts or the 
number of small businesses that would be affected, the costs 
are not likely to be significant in most years. We estimate 
that additional subsidy costs would average less than $500,000 
a year.
            Direct spending
    Section 402 would allow the SBA to defer principal and 
interest payments due on small business loans if a military 
reservist is called to active duty during a period of military 
conflict and the reservist is an essential employee of the 
small business. The deferral would last from the date on which 
the reservist is ordered to active duty until 180 days after 
the reservist is released. Section 402 also would allow the SBA 
to reduce the interest rate on loans qualifying for a deferral. 
The bill would encourage lenders and intermediaries to grant 
similar deferrals for loans guaranteed by the SBA.
    Section 403 would increase direct spending because it would 
raise the expected cost of existing loans to small businesses. 
CBO estimates that enacting this provision would probably 
increase direct spending by about $1 million in 1999, based on 
information from the SBA. We estimate that the deferral 
provision would affect fewer than 500 small business disaster 
loans (out of the 70,000 outstanding), with an average loan 
size of $50,000, and that the deferment of principal and 
interest payments would increase the average subsidy costs on 
those loans by about 5 percentage points. The increase in 
subsidy costs would be recorded as an outlay in the year in 
which the legislation is enacted.
            Revenues
    Authorizing the advisory committee to accept and use gifts 
and donations would affect direct spending and governmental 
receipts. CBO expects that any contributions (recorded in the 
budget as revenues) would be spent in the same year as they 
were received. Therefore, we estimate that the net budgetary 
impact of the gift authority granted to the advisory committee 
would be negligible.
    Pay-as-you-go considerations: The Balanced Budget and 
Emergency Control Act sets up pay-as-you-go procedures for 
legislation affecting direct spending or receipts. H.R. 1568 
would affect direct spending and receipts by increasing the 
cost of existing loans and by allowing the new advisory 
committee to accept donations. CBO estimates enacting H.R. 1568 
would increase direct spending by $1 million in 1999 and by 
less than $500,000 in each subsequent year and would increase 
governmental receipts by less than $500,000 a year.
    Intergovernmental and private-sector impact: H.R. 1568 
contains no intergovernmental or private-sector mandates as 
defined in UMRA. The bill would modify existing programs that 
require matching funds from public or private entities, 
including state, local, and tribal governments. Any cost to 
these governments from the requirements of the programs would 
be incurred voluntarily.
    Previous CBO estimate: On June 16, 1999, CBO transmitted an 
estimate of S. 918, the Military Reservists Small Business 
Relief Act of 1999, as ordered reported by the Senate Committee 
on Small Business on June 9, 1999. That bill was identical to 
section 402 of H.R. 1568; therefore, CBO estimated that 
enacting S. 918 would increase direct spending by about $1 
million in 1999 and spending subject to appropriation by less 
than $500,000 a year.
    Estimate prepared by: Federal Costs: Mark Hadley and Megan 
Carroll. Impact on State, Local, and Tribal Governments: 
Shelley Finlayson.
    Estimate approved by: Paul N. Van de Water, Assistant 
Director for Budget Analysis.

                      Committee Estimate of Costs

    Pursuant to the Congressional Budget Act of 1974, the 
Committee estimates that the amendments to the Small Business 
Act in H.R. 1568 will increase discretionary spending by no 
more than $15 million over the next five fiscal years, if fully 
funded. This estimate includes funding for the NVBDC ($12 
million), funding for loans for military reservists ($2 
million), and the attendant costs of the requested data 
collection and creation of the Office of Veterans Affairs ($1 
million). The Committee estimate is lower than the 
Congressional Budget Office (CBO) estimate.
    The Committee disagrees with information supplied to the 
CBO by the SBA which estimates a $1.3 million annual cost of 
the Office of Veterans Business Development. The Committee 
notes that Section 201 of H.R. 1568 provides only for the 
position of Associate Administrator for Veterans Business 
Development. It does not require any further hiring. The Office 
of Veterans Affairs already exists, all that is required is 
elevation of one individual, a total increase in costs of only 
$30,000. The Committee is, however, heartened by the 
possibility that the Administration may wish to increase the 
visibility of the Office of Veterans Business Development 
beyond that statutorily mandated.
    While certain provisions of H.R. 1568 have pay-go 
implications, by deferring loan repayments, they are only $1 
million in fiscal year 1999 and less than $500,000 in fiscal 
years 2000-2004. This concurs with the CBO estimate.
    Furthermore, pursuant to clause 3(d)(2)(A) of rule XIII of 
the Rules of the House of Representatives, the Committee 
estimates that implementation of H.R. 1568 will not 
significantly increase other administrative costs.

                          House of Representatives,
                             Committee on Veterans Affairs,
                                     Washington, DC, June 24, 1999.
Hon. James M. Talent,
Chairman, Committee on Small Business,
Rayburn House Office Building, Washington, DC.
    Dear Jim: It is my understanding that the Committee on 
Small Business plans to report H.R. 1568 this week. This letter 
is to advise you that the Committee on Veterans' Affairs 
supports your Committee's actions and does not plan to take any 
action on this measure. We have no objection to you seeking 
prompt consideration of this measure by the full House.
            Sincerely,
                                               Bob Stump, Chairman.

                           Oversight Findings

    In accordance with clause 4(c)(2) of rule X of the Rules of 
the House of Representatives, the Committee states that no 
oversight findings or recommendations have been made by the 
Committee on Government Reform with respect to the subject 
matter contained in H.R. 1568.
    In accordance with clause (2)(b)(1) of rule X of the Rules 
of the House of Representatives, the oversight findings and 
recommendations of the Committee on Small Business with respect 
to the subject matter contained in H.R. 1568 are incorporated 
into the descriptive portions of this report.

                 Statement of Constitutional Authority

    Pursuant to clause 3(d)(1) of rule XIII of the Rules of the 
House of Representatives, the Committee finds the authority for 
this legislation in Article I, Section 8, clause 18, of the 
Constitution of the United States.

         Changes in Existing Law Made by the Bill, as Reported

  In compliance with clause 3(e) of rule XIII of the Rules of 
the House of Representatives, changes in existing law made by 
the bill, as reported, are shown as follows (existing law 
proposed to be omitted is enclosed in black brackets, new 
matter is printed in italic, existing law in which no change is 
proposed is shown in roman):

SMALL BUSINESS ACT

           *       *       *       *       *       *       *


  Sec. 3. (a)  * * *

           *       *       *       *       *       *       *

  [(f) For purposes of section 7 of this Act, the term 
``handicapped individual'' means a person who has a physical, 
mental, or emotional impairment, defect, ailment, disease, or 
disability of a permanent nature which in any way limits the 
selection of any type of employment for which the person would 
otherwise be qualified or qualifiable.]
  (f) For purposes of section 7 of this Act, the term 
``handicapped individual'' means an individual--
          (1) who has a physical, mental, or emotional 
        impairment, defect, ailment, disease, or disability of 
        a permanent nature which in any way limits the 
        selection of any type of employment for which the 
        person would otherwise be qualified or qualifiable; or
          (2) who is a service-disabled veteran.

           *       *       *       *       *       *       *

  (q) Definitions Relating to Veterans.--In this Act, the 
following definitions apply:
          (1) Service-disabled veteran.--The term ``service-
        disabled veteran'' means a veteran with a disability 
        that is service-connected (as defined in section 
        101(16) of title 38, United States Code).
          (2) Small business concern owned and controlled by 
        service-disabled veterans.--The term ``small business 
        concern owned and controlled by service-disabled 
        veterans'' means a small business concern--
                  (A) not less than 51 percent of which is 
                owned by 1 or more service-disabled veterans 
                or, in the case of any publicly owned business, 
                not less than 51 percent of the stock of which 
                is owned by 1 or more service-disabled 
                veterans; and
                  (B) the management and daily business 
                operations of which are controlled by 1 or more 
                service-disabled veterans or, in the case of a 
                veteran with permanent and severe disability, 
                the spouse or permanent caregiver of such 
                veteran.
          (3) Small business concern owned and controlled by 
        veterans.--The term ``small business concern owned and 
        controlled by veterans'' means a small business 
        concern--
                  (A) not less than 51 percent of which is 
                owned by 1 or more veterans or, in the case of 
                any publicly owned business, not less than 51 
                percent of the stock of which is owned by 1 or 
                more veterans; and
                  (B) the management and daily business 
                operations of which are controlled by 1 or more 
                veterans.
          (4) Veteran.--The term ``veteran'' has the meaning 
        given the term in section 101(2) of title 38, United 
        States Code.
  Sec. 4. (a)  * * *
  (b)(1) The management of the Administration shall be vested 
in an Administrator who shall be appointed from civilian life 
by the President, by and with the advice and consent of the 
Senate, and who shall be a person of outstanding qualifications 
known to be familiar and sympathetic with small business needs 
and problems. The Administrator shall not engage in any other 
business, vocation, or employment than that of serving as 
Administrator. In carrying out the programs administered by the 
Small Business Administration including its lending and 
guaranteeing functions, the Administrator shall not 
discriminate on the basis of sex or marital status against any 
person or small business concern applying for or receiving 
assistance from the Small Business Administration, and the 
Small Business Administration shall give special consideration 
to veterans of the Armed Forces of the United States and their 
survivors or dependents. The President also may appoint a 
Deputy Administrator, by and with the advice and consent of the 
Senate. The Administrator is authorized to appoint [four] five 
Associate Administrators (including the Associate Administrator 
specified in section 201 of the Small Business Investment Act 
of 1958) to assist in the execution of the functions vested in 
the Administration. One such Associate Administrator shall be 
the Associate Administrator for Veterans Business Development, 
who shall administer the Office of Veterans Business 
Development established under section 32. One of the Associate 
Administrators shall be designated at the time of his 
appointment as the Associate Administrator for Minority Small 
Business and Capital Ownership Development who shall be an 
employee in the competitive service or in the Senior Executive 
Service and a career appointee and shall be responsible to the 
Administrator for the formulation and execution of the policies 
and programs under sections 7(j) and 8(a) of this Act which 
provide assistance to minority small business concerns.

           *       *       *       *       *       *       *

  Sec. 7. (a) Loans to Small Business Concerns; Allowable 
Purposes; Qualified Business; Restrictions and Limitations.--
The Administration is empowered to the extent and in such 
amounts as provided in advance in appropriation Acts to make 
loans for plant acquisition, construction, conversion, or 
expansion, including the acquisition of land, material, 
supplies, equipment, and working capital, and to make loans to 
any qualified small business concern, including those owned by 
qualified Indian tribes, for purposes of this Act. Such 
financings may be made either directly or in cooperation with 
banks or other financial institutions through agreements to 
participate on an immediate or deferred (guaranteed) basis. 
These powers shall be subject, however, to the following 
restrictions, limitations, and provisions:
          (1)  * * *

           *       *       *       *       *       *       *

          (10) The Administration may provide guaranteed loans 
        under this subsection to assist any public or private 
        organization for the handicapped or to assist any 
        handicapped individual, including service-disabled 
        veterans, in establishing, acquiring, or operating a 
        small business concern.

           *       *       *       *       *       *       *

  (21)(A) The Administration may make loans on a guaranteed 
basis under the authority of this subsection--
          (i)  * * *
          (ii) to a qualified individual or a veteran seeking 
        to establish (or acquire) and operate a small business 
        concern.

           *       *       *       *       *       *       *

  (b) Except as to agricultural enterprises as defined in 
section 18(b)(1) of this Act, the, Administration also is 
empowered to the extent and in such amounts as provided in 
advance in appropriation Acts--
          (1)  * * *

           *       *       *       *       *       *       *

        Provided, That no loan or guarantee shall be extended 
        pursuant to this paragraph (2) unless the 
        Administration finds that the applicant is not able to 
        obtain credit elsewhere.
          (3)(A) In this paragraph--
                  (i) the term ``essential employee'' means an 
                individual who is employed by a small business 
                concern and whose managerial or technical 
                expertise is critical to the successful day-to-
                day operations of that small business concern;
                  (ii) the term ``period of military conflict'' 
                has the meaning given the term in subsection 
                (n)(1); and
                  (iii) the term ``substantial economic 
                injury'' means an economic harm to a business 
                concern that results in the inability of the 
                business concern--
                          (I) to meet its obligations as they 
                        mature;
                          (II) to pay its ordinary and 
                        necessary operating expenses; or
                          (III) to market, produce, or provide 
                        a product or service ordinarily 
                        marketed, produced, or provided by the 
                        business concern.
          (B) The Administration may make such disaster loans 
        (either directly or in cooperation with banks or other 
        lending institutions through agreements to participate 
        on an immediate or deferred basis) to assist a small 
        business concern that has suffered or that is likely to 
        suffer substantial economic injury as the result of an 
        essential employee of such small business concern being 
        ordered to active military duty during a period of 
        military conflict.
          (C) A small business concern described in 
        subparagraph (B) shall be eligible to apply for 
        assistance under this paragraph during the period 
        beginning on the date on which the essential employee 
        is ordered to active duty and ending on the date that 
        is 90 days after the date on which such essential 
        employee is discharged or released from active duty.
          (D) Any loan or guarantee extended pursuant to this 
        paragraph shall be made at the same interest rate as 
        economic injury loans under paragraph (2).
          (E) No loan may be made under this paragraph, either 
        directly or in cooperation with banks or other lending 
        institutions through agreements to participate on an 
        immediate or deferred basis, if the total amount 
        outstanding and committed to the borrower under this 
        subsection would exceed $1,500,000, unless such 
        applicant constitutes a major source of employment in 
        its surrounding area, as determined by the 
        Administration, in which case the Administration, in 
        its discretion, may waive the $1,500,000 limitation.
          (F) For purposes of assistance under this paragraph, 
        no declaration of a disaster area shall be required.

           *       *       *       *       *       *       *

  (n) Repayment Deferred for Active Duty Reservists.--
          (1) Definitions.--In this subsection:
                  (A) Eligible reservist.--The term ``eligible 
                reservist'' means a member of a reserve 
                component of the Armed Forces ordered to active 
                duty during a period of military conflict.
                  (B) Essential employee.--The term ``essential 
                employee'' means an individual who is employed 
                by a small business concern and whose 
                managerial or technical expertise is critical 
                to the successful day-to-day operations of that 
                small business concern.
                  (C) Period of military conflict.--The term 
                ``period of military conflict'' means--
                          (i) a period of war declared by 
                        Congress;
                          (ii) a period of national emergency 
                        declared by Congress or by the 
                        President; or
                          (iii) a period of a contingency 
                        operation, as defined in section 101(a) 
                        of title 10, United States Code.
                  (D) Qualified borrower.--The term ``qualified 
                borrower'' means--
                          (i) an individual who is an eligible 
                        reservist and who received a direct 
                        loan under subsection (a) or (b) before 
                        being ordered to active duty; or
                          (ii) a small business concern that 
                        received a direct loan under subsection 
                        (a) or (b) before an eligible 
                        reservist, who is an essential 
                        employee, was ordered to active duty.
          (2) Deferral of direct loans.--
                  (A) In general.--The Administration shall, 
                upon written request, defer repayment of 
                principal and interest due on a direct loan 
                made under subsection (a) or (b), if such loan 
                was incurred by a qualified borrower.
                  (B) Period of deferral.--The period of 
                deferral for repayment under this paragraph 
                shall begin on the date on which the eligible 
                reservist is ordered to active duty and shall 
                terminate on the date that is 180 days after 
                the date such eligible reservist is discharged 
                or released from active duty.
                  (C) Interest rate reduction during 
                deferral.--Notwithstanding any other provision 
                of law, during the period of deferral described 
                in subparagraph (B), the Administration may, in 
                its discretion, reduce the interest rate on any 
                loan qualifying for a deferral under this 
                paragraph.
          (3) Deferral of loan guarantees and other 
        financings.--The Administration shall--
                  (A) encourage intermediaries participating in 
                the program under subsection (m) to defer 
                repayment of a loan made with proceeds made 
                available under that subsection, if such loan 
                was incurred by a small business concern that 
                is eligible to apply for assistance under 
                subsection (b)(3); and
                  (B) not later than 30 days after the date of 
                enactment of this subsection, establish 
                guidelines to--
                          (i) encourage lenders and other 
                        intermediaries to defer repayment of, 
                        or provide other relief relating to, 
                        loan guarantees under subsection (a) 
                        and financings under section 504 of the 
                        Small Business Investment Act of 1958 
                        that were incurred by small business 
                        concerns that are eligible to apply for 
                        assistance under subsection (b)(3), and 
                        loan guarantees provided under 
                        subsection (m) if the intermediary 
                        provides relief to a small business 
                        concern under this paragraph; and
                          (ii) implement a program to provide 
                        for the deferral of repayment or other 
                        relief to any intermediary providing 
                        relief to a small business borrower 
                        under this paragraph.

           *       *       *       *       *       *       *

  Sec. 8. (a) * * *

           *       *       *       *       *       *       *

  (d)(1) It is the policy of the United States that small 
business concerns, small business concerns owned and controlled 
by service-disabled veterans, qualified HUBZone small business 
concerns, small business concerns owned and controlled by 
socially and economically disadvantaged individuals, and small 
business concerns owned and controlled by women, shall have the 
maximum practicable opportunity to participate in the 
performance of contracts let by any Federal agency, including 
contracts and subcontracts for subsystems, assemblies, 
components, and related services for major systems. It is 
further the policy of the United States that its prime 
contractors establish procedures to ensure the timely payment 
of amounts due pursuant to the terms of their subcontracts with 
small business concerns, small business concerns owned and 
controlled by service-disabled veterans, qualified HUBZone 
small business concerns, small business concerns owned and 
controlled by socially and economically disadvantaged 
individuals, and small business concerns owned and controlled 
by women.

           *       *       *       *       *       *       *

  (3) The clause required by paragraph (2) shall be as follows:
          (A) It is the policy of the United States that small 
        business concerns, small business concerns owned and 
        controlled by veterans, qualified HUBZone small 
        business concerns, small business concerns owned and 
        controlled by socially and economically disadvantaged 
        individuals, and small business concerns owned and 
        controlled by women shall have the maximum practicable 
        opportunity to participate in the performance of 
        contracts let by any Federal agency, including 
        contracts and subcontracts for subsystems, assemblies, 
        components, and related services for major systems. It 
        is further the policy of the United States that its 
        prime contractors establish procedures to ensure the 
        timely payment of amounts due pursuant to the terms of 
        their subcontracts with small business concerns, small 
        business concerns owned and controlled by veterans, 
        qualified HUBZone small business concerns, small 
        business concerns owned and controlled by socially and 
        economically disadvantaged individuals, and small 
        business concerns owned and controlled by women.

           *       *       *       *       *       *       *

          (E) The term ``small business concern owned and 
        controlled by veterans'' shall mean a small business 
        concern--
                  (i) which is at least 51 per centum owned by 
                one or more eligible veterans; or, in the case 
                of any publicly owned business, at least 51 per 
                centum of the stock of which is owned by one or 
                more veterans; and
                  (ii) whose management and daily business 
                operations are controlled by such veterans. The 
                contractor shall treat as veterans all 
                individuals who are veterans within the meaning 
                of the term under section 3(q) of the Small 
                Business Act.
          [(E)] (F) Contractors acting in good faith may rely 
        on written representations by their subcontractors 
        regarding their status as either a small business 
        concern, a small business concern owned and controlled 
        by socially and economically disadvantaged individuals, 
        or a small business concern owned and controlled by 
        women.
          [(F)] (G) In this contract, the term ``qualified 
        HUBZone small business concern'' has the meaning given 
        that term in section 3(p) of the Small Business Act.
  (4)(A)  * * *

           *       *       *       *       *       *       *

  (D) No contract shall be awarded to any offeror unless the 
procurement authority determines that the plan to be negotiated 
by the offeror pursuant to this paragraph provides the maximum 
practicable opportunity for small business concerns, small 
business concerns owned and controlled by veterans, qualified 
HUBZone small business concerns, small business concerns owned 
and controlled by socially and economically disadvantaged 
individuals, and small business concerns owned and controlled 
by women to participate in the performance of the contract.
  (E) Notwithstanding any other provisions of law, every 
Federal agency, in order to encourage subcontracting 
opportunities for small business concerns, small business 
concerns owned and controlled by veterans, qualified HUBZone 
small business concerns, and small business concerns owned and 
controlled by the socially and economically disadvantaged 
individuals as defined in paragraph (3) of this subsection and 
for small business concerns owned and controlled by women, is 
hereby authorized to provide such incentives as such Federal 
agency may deem appropriate in order to encourage such 
subcontracting opportunities as may be commensurate with the 
efficient and economical performance of the contact: Provided, 
That, this subparagraph shall apply only to contracts let 
pursuant to the negotiated method of procurement.

           *       *       *       *       *       *       *

  (6) Each subcontracting plan required under paragraph (4) or 
(5) shall include--
          (A) percentage goals for the utilization as 
        subcontractors of small business concerns, small 
        business concerns owned and controlled by veterans, 
        qualified HUBZone small business concerns, small 
        business concerns owned and controlled by socially and 
        economically disadvantaged individuals, and small 
        business concerns owned and controlled by women;

           *       *       *       *       *       *       *

          (C) a description of the efforts the offeror or 
        bidder will take to assure that small business 
        concerns, small business concerns owned and controlled 
        by veterans, qualified HUBZone small business concerns, 
        small business concerns owned and controlled by 
        socially and economically disadvantaged individuals, 
        and small business concerns owned and controlled by 
        women will have an equitable opportunity to compete for 
        subcontracts;

           *       *       *       *       *       *       *

          (F) a recitation of the types of records the 
        successful offeror or bidder will maintain to 
        demonstrate procedures which have been adopted to 
        comply with the requirements and goals set forth in 
        this plan, including the establishment of source lists 
        of small business concerns, small business concerns 
        owned and controlled by veterans, qualified HUBZone 
        small business concerns, small business concerns owned 
        and controlled by socially and economically 
        disadvantaged individuals, and small business concerns 
        owned and controlled by women; and efforts to identify 
        and award subcontracts to such small business concerns.

           *       *       *       *       *       *       *

  (10) In the case of contracts within the provisions of 
paragraphs (4), (5), and (6), the Administration is authorized 
to--
          (A)  * * *
          (B) review any solicitation for any contract to be 
        let pursuant to paragraphs (4) and (5) to determine the 
        maximum practicable opportunity for small business 
        concerns, small business concerns owned and controlled 
        by veterans, qualified HUBZone small business concerns, 
        small business concerns owned and controlled by 
        socially and economically disadvantaged individuals, 
        and small business concerns owned and controlled by 
        women to participate as subcontractors in the 
        performance of any contract resulting from any 
        solicitation, and to submit its findings, which shall 
        be advisory in nature, to the appropriate Federal 
        agency; and
  (l) Management Assistance for Small Businesses Affected by 
Military Operations.--The Administration shall utilize, as 
appropriate, its entrepreneurial development and management 
assistance programs, including programs involving State or 
private sector partners, to provide business counseling and 
training to any small business concern adversely affected by 
the deployment of units of the Armed Forces of the United 
States in support of a period of military conflict (as defined 
in section 7(n)(1)).

           *       *       *       *       *       *       *

  Sec. 15. (a) * * *

           *       *       *       *       *       *       *

  (g)(1) The President shall annually establish Government-wide 
goals for procurement contracts awarded to small business 
concerns, small business concerns owned and controlled by 
service disabled veterans, qualified HUBZone small business 
concerns, small business concerns owned and controlled by 
socially and economically disadvantaged individuals, and small 
business concerns owned and controlled by women. The 
Government-wide goal for participation by small business 
concerns shall be established at not less than 23 percent of 
the total value of all prime contract awards for each fiscal 
year. The Government-wide goal for participation by small 
business concerns owned and controlled by service-disabled 
veterans shall be established at not less than 5 percent of the 
total value of all prime contract and subcontract awards for 
each fiscal year. The Government-wide goal for participation by 
qualified HUBZone small business concerns shall be established 
at not less than 1 percent of the total value of all prime 
contract awards for fiscal year 1999, not less than 1.5 percent 
of the total value of all prime contract awards for fiscal year 
2000, not less than 2 percent of the total value of all prime 
contract awards for fiscal year 2001, not less than 2.5 percent 
of the total value of all prime contract awards for fiscal year 
2002, and not less than 3 percent of the total value of all 
prime contract awards for fiscal year 2003 and each fiscal year 
thereafter. The Government-wide goal for participation by small 
business concerns owned and controlled by socially and 
economically disadvantaged individuals shall be established at 
not less than 5 percent of the total value of all prime 
contract and subcontract awards for each fiscal year. The 
Government-wide goal for participation by small business 
concerns owned and controlled by women shall be established at 
not less than 5 percent of the total value of all prime 
contract and subcontract awards for each fiscal year. 
Notwithstanding the Government-wide goal, each agency shall 
have an annual goal that presents, for that agency, the maximum 
practicable opportunity for small business concerns, small 
business concerns owned and controlled by service-disabled 
veterans, qualified HUBZone small business concerns, small 
business concerns owned and controlled by socially and 
economically disadvantaged individuals, and small business 
concerns owned and controlled by women to participate in the 
performance of contracts let by such agency. The Administration 
and the Administrator ofthe Office of Federal Procurement 
Policy shall, when exercising their authority pursuant to paragraph 
(2), insure that the cumulative annual prime contract goals for all 
agencies meet or exceed the annual Government-wide prime contract goal 
established by the President pursuant to this paragraph.
  (2) The head of each Federal agency shall, after consultation 
with the Administration, establish goals for the participation 
by small business concerns, by small business concerns owned 
and controlled by service-disabled veterans, by qualified 
HUBZone small business concerns, by small business concerns 
owned and controlled by socially and economically disadvantaged 
individuals, and by small business concerns owned and 
controlled by women in procurement contracts of such agency. 
Goals established under this subsection shall be jointly 
established by the Administration and the head of each Federal 
agency and shall realistically reflect the potential of small 
business concerns, small business concerns owned and controlled 
by service-disabled veterans, qualified HUBZone small business 
concerns, small business concerns owned and controlled by 
socially and economically disadvantaged individuals, and small 
business concerns owned and controlled by women to perform such 
contracts and to perform subcontracts under such contracts. 
Whenever the Administration and the head of any Federal agency 
fail to agree on established goals, the disagreement shall be 
submitted to the Administrator of the Office of Federal 
Procurement Policy for final determination. For the purpose of 
establishing goals under this subsection, the head of each 
Federal agency shall make consistent efforts to annually expand 
participation by small business concerns from each industry 
category in procurement contracts of the agency, including 
participation by small business concerns owned and controlled 
by service-disabled veterans, by qualified HUBZone small 
business concerns, by small business concerns owned and 
controlled by socially and economically disadvantaged 
individuals, and by small business concerns owned and 
controlled by women. The head of each Federal agency, in 
attempting to attain such participation, shall consider--
          (A)  * * *

           *       *       *       *       *       *       *

  (h)(1) At the conclusion of each fiscal year, the head of 
each Federal agency shall report to the Administration on the 
extent of participation by small business concerns, small 
business concerns owned and controlled by veterans (including 
service-disabled veterans), qualified HUBZone small business 
concerns, small business concerns owned and controlled by 
socially and economically disadvantaged individuals, and small 
business concerns owned and controlled by women in procurement 
contracts of such agency. Such reports shall contain 
appropriate justifications for failure to meet the goals 
established under subsection (g) of this section.
  (2) The Administration shall annually compile and analyze the 
reports submitted by the individual agencies pursuant to 
paragraph (1) and shall submit them to the President and 
Congress. The Administration's submission to the President 
shall include the following:
          (A) The Government-wide goals for participation by 
        small business concerns, small business concerns owned 
        and controlled by service-disabled veterans, qualified 
        HUBZone small business concerns, small business 
        concerns owned and controlled by socially and 
        economically disadvantaged individuals, and small 
        business concerns owned and controlled by women and the 
        performance in attaining such goals.
          * * * * * * *
          (D) The number and dollar value of contracts awarded 
        to small business concerns, small business concerns 
        owned and controlled by service-disabled veterans, 
        qualified HUBZone small business concerns, small 
        business concerns owned and controlled by socially and 
        economically disadvantaged individuals, and small 
        business concerns owned and controlled by women 
        through--
                  (i)  * * *
          * * * * * * *
          (E) The number and dollar value of subcontracts 
        awarded to small business concerns, small business 
        concerns owned and controlled by service-disabled 
        veterans, qualified HUBZone small business concerns, 
        small business concerns owned and controlled by 
        socially and economically disadvantaged individuals, 
        and small business concerns owned and controlled by 
        women.
          * * * * * * *

SEC. 32. VETERANS PROGRAMS.

  (a) Office of Veterans Business Development.--There is 
established in the Administration an Office of Veterans 
Business Development, which shall be administered by the 
Associate Administrator for Veterans Business Development (in 
this section referred to as the ``Associate Administrator'') 
appointed under section 4(b)(1).
  (b) Associate Administrator for Veterans Business 
Development.--The Associate Administrator--
          (1) shall be an appointee in the Senior Executive 
        Service;
          (2) shall be responsible for the formulation, 
        execution, and promotion of policies and programs of 
        the Administration that provide assistance to small 
        business concerns owned and controlled by veterans and 
        small business concerns owned and controlled by 
        service-disabled veterans. The Associate Administrator 
        shall act as an ombudsman for full consideration of 
        veterans in all programs of the Administration; and
          (3) shall report to and be responsible directly to 
        the Administrator.

SEC. 33. NATIONAL VETERANS BUSINESS DEVELOPMENT CORPORATION.

  (a) Establishment.--There is established a federally 
chartered corporation to be known as the National Veterans 
Business Development Corporation (in this section referred to 
as the ``Corporation'') which shall be incorporated under the 
laws of the District of Columbia and which shall have the 
powers granted in this section.
  (b) Purposes of the Corporation.--The purposes of the 
Corporation shall be--
          (1) to expand the provision of and improve access to 
        technical assistance regarding entrepreneurship for the 
        Nation's veterans; and
          (2) to assist veterans, including service-disabled 
        veterans, with the formation and expansion of small 
        business concerns by working with and organizing public 
        and private resources, including those of the Small 
        Business Administration, the Department of Veterans 
        Affairs, the Department of Labor, the Department of 
        Commerce, the Department of Defense, the Service Corps 
        of Retired Executives (described in section 8(b)(1)(B) 
        of this Act), the Small Business Development Centers 
        (described in section 21 of this Act), and the business 
        development staffs of each department and agency of the 
        United States.
  (c) Board of Directors.--
          (1) In general.--The management of the Corporation 
        shall be vested in a Board of Directors composed of 9 
        voting members and 3 nonvoting ex officio members.
          (2) Appointment of voting members.--The President 
        shall appoint United States citizens to be voting 
        members of the Board of Directors as follows:
                  (A) 1 from a list of individuals nominated by 
                the chairman of the Committee on Small Business 
                of the House of Representatives.
                  (B) 1 from a list of individuals nominated by 
                the chairman of the Committee on Small Business 
                of the Senate.
                  (C) 1 from a list of individuals nominated by 
                the ranking minority member of the Committee on 
                Small Business of the House of Representatives.
                  (D) 1 from a list of individuals nominated by 
                the ranking minority members of the Committee 
                on Small Business of the Senate.
                  (E) 1 from a list of individuals nominated by 
                the chairman of the Committee on Veterans' 
                Affairs of the House of Representatives.
                  (F) 1 from a list of individuals nominated by 
                the chairman of the Committee on Veterans' 
                Affairs of the Senate.
                  (G) 1 from a list of individuals nominated by 
                the ranking minority member of the Committee on 
                Veterans' Affairs of the House of 
                Representatives.
                  (H) 1 from a list of individuals nominated 
                the ranking minority member of the Committee on 
                Veterans' Affairs of the Senate.
                  (I) 1 of the President's own choosing.
          (3) Ex officio members.--The Administrator of the 
        Small Business Administration, the Secretary of 
        Defense, and the Secretary of Veterans Affairs shall 
        serve as the nonvoting ex officio members of the Board 
        of Directors.
          (4) Chairperson.--The members of the Board of 
        Directors appointed under paragraph (2) shall elect one 
        such member to serve as chairperson of the Board of 
        Directors for a term of 2 years.
          (5) Terms of appointed members.--
                  (A) In general.--Each member of the Board of 
                Directors appointed under paragraph (2) shall 
                serve a term of 6 years, except as provided in 
                subparagraph (B).
                  (B) Terms of initial appointees.--As 
                designated by the President at the time of 
                appointment, of the members first appointed--
                          (i) 3 shall be for a term of 2 years; 
                        and
                          (ii) 3 shall be for a term of 4 
                        years.
                  (C) Unexpired terms.--Any member of the Board 
                of Directors appointed to fill a vacancy 
                occurring before the expiration of the term for 
                which the member's predecessor was appointed 
                shall be appointed only for the remainder of 
                the term. A member may serve after the 
                expiration of that member's term until a 
                successor has taken office.
          (6) Vacancies.--Any vacancy on the Board of Directors 
        shall be filled in the manner in which the original 
        appointment was made. In the case of a vacancy in the 
        office of the Administrator of the Small Business 
        Administration or the Secretary of Veterans Affairs, 
        and pending the appointment of a successor, an acting 
        appointee for such vacancy may serve as an ex officio 
        member.
          (7) Ineligibility for other offices.--No voting 
        member of the Board of Directors may be an officer or 
        employee of the United States while serving as a member 
        of the Board of Directors or during the 2-year period 
        preceding such service.
          (8) Impartiality and nondiscrimination.--The Board of 
        Directors shall administer the affairs of the 
        Corporation fairly and impartially and without 
        discrimination.
          (9) Obligations and expenses.--The Board of Directors 
        shall prescribe the manner in which the obligations of 
        the Corporation may be incurred and in which its 
        expenses shall be allowed and paid.
          (10) Quorum.--5 voting members of the Board of 
        Directors shall constitute a quorum, but a lesser 
        number may hold hearings.
  (d) Corporate Powers.--On October 1, 1999, the Corporation 
shall become a body corporate and as such shall have the 
authority to do the following:
          (1) To adopt and use a corporate seal.
          (2) To have succession until dissolved by an Act of 
        Congress.
          (3) To make contracts or grants.
          (4) To sue and be sued, and to file and defend 
        against lawsuits in State or Federal court.
          (5) To appoint, through the actions of its Board of 
        Directors, officers and employees of the Corporation, 
        to define their duties and responsibilities, fix their 
        compensations, and to dismiss at will such officers or 
        employees.
          (6) To prescribe, through the actions of its Board of 
        Directors, bylaws not inconsistent with Federal law and 
        the law of the State of incorporation, regulating the 
        manner in which its general business may be conducted 
        and the manner in which the privileges granted to it by 
        law may be exercised.
          (7) To exercise, through the actions of its Board of 
        Directors or duly authorized officers, all powers 
        specifically granted by the provisions of this section, 
        and such incidental powers as shall be necessary.
          (8) To solicit, receive, and disburse funds from 
        private, Federal, State and local organizations.
          (9) To accept and employ or dispose of in furtherance 
        of the purposes of this section any money or property, 
        real, personal, or mixed, tangible or intangible, 
        received by gift, devise, bequest, or otherwise.
          (10) To accept voluntary and uncompensated services.
  (e) Corporate Funds.--
          (1) Deposit of funds.--The Board of Directors shall 
        deposit all funds of the Corporation in federally 
        chartered and insured depository institutions until 
        such funds are disbursed under paragraph (2).
          (2) Disbursement of funds.--Funds of the Corporation 
        may be disbursed only for purposes that are--
                  (A) approved by the Board of Directors by a 
                recorded vote with a quorum present; and
                  (B) in accordance with the purposes of the 
                Corporation as specified in subsection (b).
  (f) Network of Information and Assistance Centers.--In 
carrying out the purpose described in subsection (b), the 
Corporation shall establish and maintain a network of 
information and assistance centers for use by veterans and the 
public.
  (g) Annual Report.--On or before October 1 of each year, the 
Board of Directors shall transmit a report to the President and 
Congress describing the activities and accomplishments of the 
Corporation for the preceding year and the Corporation's 
findings regarding the efforts of Federal, State and private 
organizations to assist veterans in the formation and expansion 
of small business concerns.
  (h) Assumption of Duties of Advisory Committee.--On October 
1, 2004, the Corporation established under this section shall 
assume the duties, responsibilities, and authority of the 
Advisory Committee on Veterans Affairs established under 
section 203 of this Act.
  (i) Use of Mails.--The Corporation may use the United States 
mails in the same manner and under the same conditions as the 
departments and agencies of the United States.
  (j) Professional Certification Advisory Board.--
          (1) In general.--Acting through the Board of 
        Directors, the Corporation shall establish a 
        Professional Certification Advisory Board to create 
        uniform guidelines and standards for the professional 
        certification of members of the Armed Services to aid 
        in their efficient and orderly transition to civilian 
        occupations and professions and to remove potential 
        barriers in the areas of licensure and certification.
          (2) Membership.--The members of the Advisory Board 
        shall serve without compensation, shall meet in the 
        District of Columbia no less than quarterly, and shall 
        be appointed by the Board of Directors as follows:
                  (A) Private sector members.--The Corporation 
                shall appoint not less than 7 members for terms 
                of 2 years to represent private sector 
                organizations and associations, including the 
                American Association of Community Colleges, the 
                Society for Human Resource Managers, the 
                Coalition for Professional Certification, and 
                the Council on Licensure and Enforcement.
                  (B) Public sector members.--The Corporation 
                shall invite public sector members to serve at 
                the discretion of their departments or agencies 
                and shall--
                          (i) encourage the participation of 
                        the Under Secretary of Defense for 
                        Personnel and Readiness;
                          (ii) encourage the participation of 2 
                        officers from each branch of the Armed 
                        Forces to represent the Training 
                        Commands of their branch; and
                          (iii) seek the participation and 
                        guidance of the Assistant Secretary of 
                        Labor for Veterans' Employment and 
                        Training.
  (k) Authorization of Appropriations.--
          (1) In general.--There are authorized to be 
        appropriated to the Corporation to carry out this 
        section the following amounts:
                  (A) $2,000,000 for fiscal year 2000;
                  (B) $4,000,000 for fiscal year 2001;
                  (C) $4,000,000 for fiscal year 2002; and
                  (D) $2,000,000 for fiscal year 2003.
          (2) Privatization.--The Corporation shall institute 
        and implement a plan to raise private funds and become 
        a self-sustaining corporation.
  Sec. [32.] 34. All laws and parts of laws inconsistent with 
this Act are hereby repealed to the extent of such 
inconsistency.
                              ----------                              


        SECTION 501 OF THE SMALL BUSINESS INVESTMENT ACT OF 1958

  Sec. 501. (a)  * * *

           *       *       *       *       *       *       *

  (d) In order to qualify for assistance under this title, the 
development company must demonstrate that the project to be 
funded is directed toward at least one of the following 
economic development objectives--
          (1)  * * *

           *       *       *       *       *       *       *

          (3) the achievement of one or more of the following 
        public policy goals:
                  (A) business district revitalization,

           *       *       *       *       *       *       *

                  (E) expansion of small business concerns 
                owned and controlled by veterans, as defined in 
                section 3(q) of the Small Business Act (15 
                U.S.C. 632(q)), especially service-disabled 
                veterans, as defined in such section 3(q),
                  [(E)] (F) enhanced economic competition, 
                including the advancement of technology, plan 
                retooling, conversion to robotics, or 
                competition with imports,
                  [(F)] (G) changes necessitated by Federal 
                budget cutbacks, including defense related 
                industries, or
                  [(G)] (H) business restructuring arising from 
                Federally  mandated  standards  or  policies  
                affecting the environment or the safety and 
                health of employees.

           *       *       *       *       *       *       *

                              ----------                              


     SECTION 303 OF THE SMALL BUSINESS ECONOMIC POLICY ACT OF 1980

  Sec. 303. (a) * * *

           *       *       *       *       *       *       *

          (e) The information and data required to be reported 
        pursuant to subsection (a) shall separately detail 
        those portions of such information and data that are 
        relevant to--
                  (1) small business concerns owned and 
                controlled by socially and economically 
                disadvantaged individuals as defined pursuant 
                to section 8(d) of the Small Business Act; 
                [and]
                  (2) small business concerns owned and 
                controlled by women[.]; and
          (3) small business concerns owned and controlled by 
        veterans, as defined in section 3(q) of the Small 
        Business Act (15 U.S.C. 632(q)), and small business 
        concerns owned and controlled by service-disabled 
        veterans, as defined in such section 3(q).
                              ----------                              


                 SECTION 202 OF THE ACT OF JUNE 4, 1976


AN ACT To amend the Small Business Act and Small Business Investment 
  Act of 1958 to provide additional assistance under such Acts, to 
  create a pollution control financing program for small business, 
  and for other purposes.

                                 study

  Sec. 202. The primary functions of the Office of the Advocacy 
shall be to--
  (1)  * * *

           *       *       *       *       *       *       *

  (10) determine the desirability of developing a set of 
rational, objective criteria to be used to define small 
business, and to develop such criteria, if appropriate; [and]
  (11) advice, cooperate with, and consult with, the Chairman 
of the Administrative Conference of the United States with 
respect to section 504(e) of title 5 of the United States 
Code[.]; and
  (12) evaluate the efforts of each department and agency of 
the United States, and of private industry, to assist small 
business concerns owned and controlled by veterans, as defined 
in section 3(q) of the Small Business Act (15 U.S.C. 632(q)), 
and small business concerns owned and controlled by serviced-
disabled veterans, as defined in such section 3(q), and to 
provide statistical information on the utilization of such 
programs by such small business concerns, and to make 
appropriate recommendations to the Administrator of the Small 
Business Administration and to Congress in order to promote the 
establishment and growth of those small business concerns.