92 STAT. 1762 Performance bonds. "Socially and economically disadvantaged small business concern." "Socially disadvantaged individuals." "Economically disadvantaged individuals." PUBLIC LAW 95-507-OCT. 24, 1978 "(2) Notwithstanding subsections (a) and (c) of the first section of the Act entitled 'An Act requiring contracts for the construction, alteration, and repair of any public building or public work of the United States to be accompanied by a performance bond protecting the United States and by additional bond for the protection of persons furnishing material and labor for the construction, alteration, or repair of said public buildings or public work,' approved August 24, 1935 (49 Stat. 793), no small business concern shall be required to provide any amount of any bond as a condition of receiving any subcontract under this subsection if the Administrator determines that such amount is inappropriate for such concern in performing such contract: Provided. That the Administrator shall exercise the authority granted by the paragraph only if— "(A) the Administration takes such measures as it deems appropriate for the protection of persons furnishing materials and labor to a small business receiving any benefit pursuant to this paragraph; "(B) the Administration assists, insofar as practicable, a small business receiving the benefits of this paragraph to develop. within a reasonable period of time, such financial and other capability as may be needed to obtain such bonds as the Administration may subsequently require for the successful completion of any program conducted under the authority of this subsection: "(C) the Administration finds that such small business is unable to obtain the requisite bond or bonds from a surety and that no surety is willing to issue such bond or bonds subject to the guarantee provisions of Title IV of the Small Business Investment Act of 1958; and "(D) the small business is determined to be a start-up concern and such concern has not been participating in any program conducted under the authority of this subsection for a period exceeding one year. "This paragraph shall not apply after September 30, 1980. "(3) Any small business concern selected by the Administration to perform any Federal Government procurement contract to be let pursuant to this subsection shall, when practicable, participate in any negotiation of the terms and conditions of such contract. "(4) For purposes of this section, the term 'socially and economically disadvantaged small business concern' means any small business concern "(A) which is at least 51 per centum owned by one or more socially and economically disadvantaged individuals; 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 socially and economically disadvantaged individuals: and “(B) whose management and daily business operations are controlled by one or more of such individuals. "(5) Socially disadvantaged individuals are those who have been subjected to racial or ethnic prejudice or cultural bias because of their identity as a member of a group without regard to their individual qualities. "(6) Economically disadvantaged individuals are those socially disadvantaged individuals whose ability to compete in the free enterprise system has been impaired due to diminished capital and credit opportunities as compared to others in the same business area who are not socially disadvantaged. In determining the degree of diminished credit PUBLIC LAW 95-507–OCT. 24, 1978 and capital opportunities the Administration shall consider, but not be limited to, the assets and net worth of such socially disadvantaged individual. "(7) No small business concern shall be deemed eligible for any assistance pursuant to this subsection unless the Administration determines that with contract, financial, technical, and management support the small business concern will be able to perform contracts which may be awarded to such concern under paragraph (1)(C) and has reasonable prospects for success in competing in the private sector. 66 92 STAT. 1763 “(8) All determinations made pursuant to paragraphs (4), (5), (6) Determinations. and (7), shall be made by the Associate Administrator for Minority Small Business and Capital Ownership Development. "(9) Within ninety days after the effective date of this paragraph, the Administration shall publish in the Federal Register rules setting forth those conditions or circumstances pursuant to which a firm previously deemed eligible by the Administration may be denied assistance under the provisions of this subsection: Provided. That no such firm shall be denied total participation in any program conducted under the authority of this subsection without first being afforded a hearing on the record in accordance with chapter 5 of title 5, United States Code. "(10) The Administration shall develop and implement an outreach program to inform and recruit small business concerns to apply for eligibility for assistance under this subsection. (11) To the maximum extent practicable, construction subcontracts awarded by the Administration pursuant to this subsection shall be awarded within the county or State where the work is to he performed. Publication in "(12) To the maximum extent practicable the Associate Administra- Annual estimate. tor for Minority Small Business and Capital Ownership Development shall submit, no less frequently than annually, a yearly estimate of the dollar amounts and types of contracts required for the efficient use of any program conducted under the authority of this subsection, to each agency which may participate in such program.". (b) Not later than June 30, 1980, the General Accounting Office shall submit to the Congress a report which, with respect to provisions of paragraphs (1) (B) and (2) of section 8(a) of the Small Business Act, shall evaluate the implementation of such provisions and whether such implementation furthered the purposes under section 2(e) of the Small Business Act. Report to SEC. 203. Section 2(c) of the Small Business Act is amended by 15 USC 631. inserting “(1)“ after "(c)" and by adding at the end thereof the following new paragraph: (2)(A) With respect to the programs authorized by section 7(j) Post, p. 1764. of this Act, the Congress finds— "(i) that ownership and control of productive capital is concentrated in the economy of the United States and certain groups, therefore, own and control little productive capital; “(ii) that certain groups in the United States own and control little productive capital because they have limited opportunities for small business ownership: **(iii) that the broadening of small business ownership among groups that presently own and control little productive capital is essential to provide for the well-being of this Nation by promoting their increased participation in the free enterprise system of the United States; 92 STAT. 1764 Ante, p. 1761. Infra. PUBLIC LAW 95-507-OCT. 24, 1978 (iv) that such development of business ownership among groups that presently own and control little productive capital will be greatly facilitated through the creation of a small business ownership development program, which shall provide services, including, but not limited to, financial, management, and technical assistance. "(v) that the power to let sole source Federal contracts pursuant to section 8(a) of the Small Business Act can be an effective procurement assistance tool for development of business ownership among groups that own and control little productive capital; and "(vi) that the procurement authority under section 8(a) of the Small Business Act shall be used only as a tool for developing business ownership among groups that own and control little productive capital. "(B) It is, therefore, the purpose of the programs authorized by section 7(j) of this Act to (i) foster business ownership by individuals in groups that own and control little productive capital; and 66 "(ii) promote the competitive viability of such firms by creating a small business and capital ownership development program to provide such available financial, technical, and management assistance as may be necessary.". SEC. 204. Section 7(j) of the Small Business Act is amended to read as follows: "(j) (1) The Administration shall provide financial assistance to public or private organizations to pay all or part of the cost of projects designed to provide technical or management assistance to individuals or enterprises eligible for assistance under sections 7(i), 7(j) (10), and 8(a) of this Act, with special attention to small businesses located in areas of high concentration of unemployed or lowincome individuals, to small businesses eligible to receive contracts pursuant to section 8(a) of this Act. "(2) Financial assistance under this subsection may be provided for projects. including, but not limited to "(A) planning and research, including feasibility studies and market research; "(B) the identification and development of new business opportunities; (C) the furnishing of centralized services with regard to public services and Federal Government programs including programs authorized under sections 7(i). (7)(j)(10), and 8(a) of this Act: “(D) the establishment and strengthening of business service agencies, including trade associations and cooperatives; and "(E) the furnishing of business counseling, management training, and legal and other related services, with special emphasis on the development of management training programs using the resources of the business community, including the development of management training opportunities in existing business, and with emphasis in all cases upon providing management training of sufficient scope and duration to develop entrepreneurial and managerial self-sufficiency on the part of the individuals served. "(3) The Administration shall encourage the placement of subcontracts by businesses with small business concerns located in areas of high concentration of unemployed or low-income individuals, with small businesses owned by low-income individuals, and with small PUBLIC LAW 95-507–OCT. 24, 1978 92 STAT. 1765 businesses eligible to receive contracts pursuant to section 8(a) of this Ante. p. 1761. Act. The Administration may provide incentives and assistance to such businesses that will aid in the training and upgrading of potential subcontractors or other small business concerns eligible for assistance under sections 7 (i), 7(j), and 8(a) of this Act. 15 USC 636. “(A) An advisory committee composed of five high-level offi- Ante. p. 1764. cers from five United States businesses and five representatives Advisory of minority small businesses shall be created to facilitate the committee, achievement of the purposes of this paragraph. The members of establishment. the advisory committee shall be appointed by the President. The Membership. chairman of the advisory committee, who shall be designated by the President shall report annually to the President and to the Congress on the activities of the advisory committee. (B) The General Accounting Office shall evaluate the activi- Report to ties taken by the Administration to achieve the purpose of this Congress. paragraph and evaluate the success of these activities in achieving the purposes of this paragraph. The General Accounting Office shall report to the Congress by January 1. 1981. and at any time thereafter at the discretion of the Comptroller General, on the findings of this evaluation and shall make recommendations on actions needed to improve the Administration's performance pursuant to this paragraph. “(4) The Administration shall e've preference to projects which promote the ownership, participation in ownership, or management of small businesses owned by low-income individuals and small businesses eligible to receive contracts pursuant to section (a) of this Act. (5) The financial assistance authorized for projects under this sub- Grants and section includes assistance advanced by grant, agreement, or contract. contracts. (6) The Administration is authorized to make payments under grants and contracts entered into under this subsection in lump sum or installments, and in advance or by way of reimbursement. and in the case of grants, with necessary adjustments on account of overpayments or underpayments. *(7) To the extent feasible, services under this subsection shall be provided in a location which is easily accessible to the individuals and small business concerns served. (S) The General Accounting Office shall provide for an independ- Program ent and continuing evaluation of programs under sections 7(1), 7(j), evaluation. and S(a) of this Act, including full information on, and analysis of. the character and impact of managerial assistance provided, the location, income characteristics, and extent to which private resources and skills have been involved in these programs. Such evaluation together Report to with any recommendations deemed advisable by the Comptroller Gen- Congress. eral shall be reported to the Congress by January 1, 1981. and at any time thereafter at the discretion of the Comptroller General. "(9) The Administration shall take such steps as may be necessary and appropriate, in coordination and cooperation with the heads of other Federal departments and agencies, to insure that contracts, subcontracts, and deposits made by the Federal Government or with programs aided with Federal funds are placed in such way as to further the purposes of sections 7(1), 7(j), and Sta) of this Act. ownership development "(10) There is established within the Administration a small busi- Small business ness and capital ownership development program (hereinafter and capital referred to as the Program) which shall provide assistance exclusively for mall business concerns eligible to receive contracts pursuant to section Sta) of this Act. The management of the Program shall be vested in the Associate Administrator for Minority Small program. establishment. 92 STAT. 1766 Ante. pp. 1764. 1761. 15 USC 694a. Responsibilities. 15 USC 633. PUBLIC LAW 95-507–OCT. 24, 1978 Business and Capital Ownership Development who shall also manage all other services and activities authorized under section. 7(j) and S(a) of this Act. "(A) The Program shall (i) assist small business concerns participating in the Program to develop comprehensive business plans with specific business targets, objectives, and goals: "(ii) provide for such other nonfinancial services as deemed necessary for the establishment, preservation, and growth of small business concerns participating in the Program, including but not limited to (I) loan packaging. (11) financial counseling, (III) accounting and bookkeeping assistance. (IV) marketing assistance, and (V) management assistance; (iii) assist small business concerns participating in the Program to obtain equity and debt financing: (iv) establish regular performance monitoring and reporting systems for small business concerns participating in the Program to assure compliance with their business plans: "(v) analyze and report the causes of success and failure of small business concerns participating in the Program; and “(vi) provide assistance necessary to help small business concerns participating in the Program to procure surety bonds, with such assistance including, but not limited to, (I) the preparation of application forms required to receive a surety bond. (II) special management and technical assistance designed to meet the specific needs of small business concerns participating in the Program and which have received or are applying to receive a surety bond, and (III) preparation of all forms necessary to receive a surety bond guarantee from the Administration pursuant to title IV, part B of the Small Business Investment Act of 1958. “(B) Small business concerns eligible to receive contracts pursuant to section 8(a) of this Act shall participate in the Program. (C) No small business concern shall receive a contract pursuant to section 8(a) of this Act unless the Program is able to provide such small business concern with, but not limited to, such management, technical, and financial services as may be necessary to promote the competitive viability of the small business concern within a reasonable period of time. "(11) The Associate Administrator for Minority Small Business and Capital Ownership Development shall be responsible for coordinating and formulating policies relating to Federal assistance to small business concerns eligible for assistance under section 7(i) of this Act and small business concerns eligible to receive contracts pursuant to section (a) of this Act.”. SEC. 205. Section 7(k) of the Small Business Act is amended by striking the words “7(i) and 7(j)“ and inserting in lien thereof “7(i). 7(j), and 8(a)”. SEC. 206. Section 4(b) of the Small Business Act is amended by striking “Associate Administrator for Minority Small Business" where it appears therein and by substituting the following: “Associate Administrator for Minority Small Business and Capital Ownership Development". |