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Title II — Minority Business Development Agency

H.R. 2551 · 113th Congress · Jun 27, 2013 · Lineage

II Minority Business Development Agency

Sec. 201 Definitions

In this title:
(1)
Historically disadvantaged individual— The term historically disadvantaged individual means any individual who is a member of a group that is designated as eligible to receive assistance under section 1400.1 of title 15, Code of Federal Regulations, as in effect on January 1, 2009.
(2)
Principal— The term principal means any person that the Director determines to exercise significant control over the regular operations of a business entity.
(3)
Program— The term Program means the Minority Business Development Program established under section 202.

Sec. 202 Emerging minority business development program

The National Director of the Minority Business Development Agency shall establish the Minority Business Development Program to assist qualified minority businesses. The Program shall provide to such businesses the following:
(1)
Technical assistance under section 204.
(2)
Loan guarantees under section 208.
(3)
Contract procurement assistance under section 205.

Sec. 203 Qualified minority business

(a)
Certification— For purposes of the Program, the National Director of the Minority Business Development Agency may certify as a qualified minority business any entity that satisfies each of the following:
(1)
Not less than 51 percent of the entity is directly and unconditionally owned or controlled by historically disadvantaged individuals.
(2)
Each officer or other individual who exercises control over the regular operations of the entity is a historically disadvantaged individual.
(3)
The net worth of each principal of the entity is not greater than $2,000,000. (The equity of a disadvantaged owner in a primary personal residence shall not be considered in this calculation.)
(4)
The principal place of business of the entity is in the United States.
(5)
Each principal of the entity maintains good character in the determination of the National Director.
(6)
The entity engages in competitive and bona fide commercial business operations in not less than one sector of industry that has a North American Industry Classification System code.
(7)
The entity submits reports to the National Director at such time, in such form, and containing such information as the National Director may require.
(8)
Such other requirements as the National Director considers appropriate.
(b)
Term of certification— A certification under this section shall be for a term of 5 years and may not be renewed.

Sec. 204 Technical assistance

(a)
In general— In carrying out the Program, the National Director of the Minority Business Development Agency may provide to qualified minority businesses technical assistance with regard to the following:
(1)
Writing business plans.
(2)
Marketing.
(3)
Management.
(4)
Securing sufficient financing for business operations.
(b)
Contract authority— The National Director may enter into agreements with persons to provide technical assistance under this section.

Sec. 205 Set-aside contracting opportunities

(a)
In general— The National Director of the Minority Business Development Agency may enter into agreements with the United States Government and any department, agency, or officer thereof having procurement powers for purposes of providing for the fulfillment of procurement contracts and providing opportunities for qualified minority businesses with regard to such contracts.
(b)
Qualifications on participation— The National Director shall by rule establish requirements for participation under this section by a qualified minority business in a contract.
(c)
Annual limit on number of contracts per qualified minority business— A qualified minority business may not participate under this section in contracts in an amount that exceeds $10,000,000 for goods and services each fiscal year.
(d)
Limits on contract amounts—
(1)
Goods and services— Except as provided in paragraph (2), a contract for goods and services under this section may not exceed $6,000,000.
(2)
Manufacturing and construction— A contract for manufacturing and construction services under this section may not exceed $10,000,000.

Sec. 206 Termination from program

The National Director of the Minority Business Development Agency may terminate a qualified minority business from the Program for any violation of a requirement of sections 203 through 206 by that qualified minority business, including the following:
(1)
Conduct by a principal of the qualified minority business that indicates a lack of business integrity.
(2)
Willful failure to comply with applicable labor standards and obligations.
(3)
Consistent failure to tender adequate performance with regard to contracts under the Program.
(4)
Failure to obtain and maintain relevant certifications.
(5)
Failure to pay outstanding obligations owed to the Federal Government.

Sec. 207 Authorization of appropriations

(a)
Authorization of Appropriations— There are authorized to be appropriated $200,000,000 to the National Director to carry out this section. Such sums shall remain available until expended.

Sec. 208 Loan guarantees

(a)
In general— Subject to subsection (b), the National Director of the Minority Business Development Agency may guarantee up to 90 percent of the amount of a loan made to a qualified minority business to be used for business purposes, including the following:
(1)
Purchasing essential equipment.
(2)
Payroll expenses.
(3)
Purchasing facilities.
(4)
Renovating facilities.
(b)
Terms and conditions—
(1)
In general— The National Director may make guarantees under this section for projects on such terms and conditions as the National Director determines appropriate, after consultation with the Secretary of the Treasury, in accordance with this section.
(2)
Repayment— No guarantee shall be made under this section unless the National Director determines that there is reasonable prospect of repayment of the principal and interest on the obligation by the borrower.
(3)
Defaults—
(A)
Payment by national director—
(i)
In general— If a borrower defaults on the obligation (as defined in regulations promulgated by the National Director and specified in the guarantee contract), the holder of the guarantee shall have the right to demand payment of the unpaid amount from the National Director.
(ii)
Payment required— Within such period as may be specified in the guarantee or related agreements, the National Director shall pay to the holder of the guarantee the unpaid interest on, and unpaid principal of the obligation as to which the borrower has defaulted, unless the National Director finds that there was no default by the borrower in the payment of interest or principal or that the default has been remedied.
(iii)
Forbearance— Nothing in this paragraph precludes any forbearance by the holder of the obligation for the benefit of the borrower which may be agreed upon by the parties to the obligation and approved by the Director.
(B)
Subrogation—
(i)
In general— If the National Director makes a payment under subparagraph (A), the National Director shall be subrogated to the rights of the recipient of the payment as specified in the guarantee or related agreements including, where appropriate, the authority (notwithstanding any other provision of law) to—
(I)
complete, maintain, operate, lease, or otherwise dispose of any property acquired pursuant to such guarantee or related agreements; or
(II)
permit the borrower, pursuant to an agreement with the National Director, to continue to pursue the purposes of the project if the National Director determines this to be in the public interest.
(ii)
Superiority of rights— The rights of the National Director, with respect to any property acquired pursuant to a guarantee or related agreements, shall be superior to the rights of any other person with respect to the property.
(iii)
Terms and conditions— A guarantee agreement shall include such detailed terms and conditions as the National Director determines appropriate to—
(I)
protect the interests of the United States in the case of default; and
(II)
have available all the patents and technology necessary for any person selected, including the National Director, to complete and operate the project.
(C)
Payment of principal and interest by national director— With respect to any obligation guaranteed under this section, the National Director may enter into a contract to pay, and pay, holders of the obligation, for and on behalf of the borrower, from funds appropriated for that purpose, the principal and interest payments which become due and payable on the unpaid balance of the obligation if the National Director finds that—
(i)
(I)
the borrower is unable to meet the payments and is not in default;
(II)
it is in the public interest to permit the borrower to continue to pursue the purposes of the project; and
(III)
the probable net benefit to the Federal Government in paying the principal and interest will be greater than that which would result in the event of a default;
(ii)
the amount of the payment that the National Director is authorized to pay shall be no greater than the amount of principal and interest that the borrower is obligated to pay under the agreement being guaranteed; and
(iii)
the borrower agrees to reimburse the National Director for the payment (including interest) on terms and conditions that are satisfactory to the National Director.
(D)
Action by attorney general—
(i)
Notification— If the borrower defaults on an obligation, the National Director shall notify the Attorney General of the default.
(ii)
Recovery— On notification, the Attorney General shall take such action as is appropriate to recover the unpaid principal and interest due from—
(I)
such assets of the defaulting borrower as are associated with the obligation; or
(II)
any other security pledged to secure the obligation.
(4)
Fees—
(A)
In general— The National Director shall charge and collect fees for guarantees in amounts the National Director determines are sufficient to cover applicable administrative expenses, not to exceed 1 percent of the amount guaranteed.
(B)
Availability— Fees collected under this paragraph shall—
(i)
be deposited by the National Director into the Treasury; and
(ii)
remain available until expended, subject to such other conditions as are contained in annual appropriations Acts.
(c)
Credit requirements— To receive a loan guaranteed under this section a qualified minority business shall—
(1)
be in good standing with regard to the credit of that business in the determination of the National Director;
(2)
have received technical assistance under section 204; and
(3)
submit reports, at such time, in such form, and containing such information as the National Director may require regarding the credit of the business.
(d)
Limits on guarantee amounts—
(1)
Maximum amount of guarantee— The National Director may not guarantee more than $450,000 of any loan under this section.
(2)
Maximum gross loan amount— A loan guaranteed under this section may not be for a gross loan amount in excess of $500,000.
(e)
Authorization of appropriations— There are authorized to be appropriated to the National Director not more than $500,000,000 to carry out this section during fiscal years 2014 through 2019.

Sec. 209 Reports

(a)
Report of the director— Not later than October 1, 2012, and annually thereafter, the National Director of the Minority Business Development Agency shall submit to the Committee on Commerce, Science, and Transportation of the Senate and the Committee on Energy and Commerce of the House of Representatives a report describing the activities of the National Director during the preceding year with respect to the Program.
(b)
Report of the secretary of commerce— Not later than October 1, 2012, and annually thereafter, the Secretary of Commerce shall submit to the Committee on Commerce, Science, and Transportation of the Senate and the Committee on Energy and Commerce of the House of Representatives a report describing the activities the Secretary engaged in during the preceding year to build wealth among historically disadvantaged individuals.

Sec. 210 Minority business development agency database

Not later than 90 days after the date of the enactment of this Act, the National Director of the Minority Business Development Agency shall establish a database to assist prime contractors in identifying historically disadvantaged firms for subcontracting.