Small Business Workforce Pipeline Act of 2022
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- Crpt 117Hrpt329
Summary
House Report 117–329 of the 117th Congress, 2d Session, submitted May 17, 2022 by Ms. Velázquez from the Committee on Small Business to accompany H.R. 7622, the Small Business Workforce Pipeline Act of 2022. The Committee reports the bill favorably without amendment and recommends that it pass. The report states the bill would add to Small Business Development Center services support for small businesses struggling to find workers, including information from the Department of Labor on apprenticeships, work-based learning, pre-apprenticeships and job training programs. It describes a March 31, 2022 subcommittee hearing on the labor shortage and a May 11, 2022 markup at which the Committee ordered the bill reported by voice vote. The report closes with the changes in existing law to section 21 of the Small Business Act.
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117TH CONGRESS REPORT
" HOUSE OF REPRESENTATIVES !
2d Session 117–329
SMALL BUSINESS WORKFORCE PIPELINE ACT OF 2022
MAY 17, 2022.—Committed to the Committee of the Whole House on the State of
the Union and ordered to be printed
Ms. VELÁZQUEZ, from the Committee on Small Business,
submitted the following
R E P O R T
[To accompany H.R. 7622]
The Committee on Small Business, to whom was referred the bill
(H.R. 7622) to amend the Small Business Act to include require-
ments relating to apprenticeship program assistance for small busi-
ness development centers, and for other purposes, having consid-
ered the same, reports favorably thereon without amendment and
recommends that the bill do pass.
CONTENTS
Page
I. Purpose and Bill Summary ........................................................................... 1
II. Background and Need for Legislation .......................................................... 2
III. Hearings ......................................................................................................... 2
IV. Committee Consideration .............................................................................. 3
V. Committee Votes ............................................................................................ 3
VI. Section-by-Section for H.R. 7622 .................................................................. 3
VII. Congressional Budget Cost Estimate ........................................................... 3
VIII. New Budget Authority, Entitlement Authority, and Tax Expenditures 3
IX. Committee Oversight Findings and Recommendations .............................. 4
X. Statement of General Performance Goals and Objectives .......................... 4
XI. Duplication of Federal Programs .................................................................. 4
XII. Congressional Earmarks, Limited Tax Benefits, and Limited Tariff Ben-
efits .............................................................................................................. 4
XIII. Federal Mandates Statement ....................................................................... 4
XIV. Federal Advisory Committee Statement ...................................................... 4
XV. Applicability to Legislative Branch .............................................................. 4
XVI. Changes in Existing Law Made by the Bill, as Reported ........................... 5
I. PURPOSE AND BILL SUMMARY
The purpose of H.R. 7622, the ‘‘Small Business Workforce Pipe-
line Act of 2022’’, is to add to the services provided by Small Busi-
ness Development Centers (SBDCs) to include support for small
businesses that are struggling to find workers. This support in-
29–006
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2
cludes disseminating information from the Department of Labor re-
garding Apprenticeships, Work-Based Learning Opportunities, Pre-
Apprenticeships, and Job Training Programs.
II. BACKGROUND AND NEED FOR LEGISLATION
H.R. 7622 was introduced by Representative Jason Crow (D–CO),
Representative Scott Fitzgerald (R–NY), Representative Chrissy
Houlahan (D–PA), and Representative Andrew Garbarino (R–NY)
on April 28, 2022.
The economic impact of the COVID–19 pandemic has resulted in
a labor shortage that is being acutely felt by small firms. For every
unemployed individual seeking a job, there are roughly 1.7 job
openings in the economy. In March, Federal Reserve Chairman Je-
rome Powell called the labor market, ‘‘tight to an unhealthy level.’’
While many businesses may have no trouble attracting applicants,
it is often hard for them to find applicants with the skills they are
looking for, and many are now turning to direct investments in
their own workforce as a benefit of employment.
Apprenticeships are among the most successful form of workforce
development. They often include paid, on-the-job training alongside
classroom education that provides well-rounded experience to work-
ers and equips them with skills that can be used in multiple career
paths. Because it is an earn-while-you-learn model of workforce de-
velopment, it could potentially be a more accessible way of edu-
cating workers that may not have the resources to engage with tra-
ditional education. These programs often last several years and
provide accessible training and education to workers through
stackable credentials, academic credit, and mentorship opportuni-
ties. According to the Department of Labor (DOL), 92 percent of ap-
prentices who complete their apprenticeships retain employment
with an average starting salary of $72,000.
Traditionally, apprenticeships have only been developed in the
skilled trades, and they have not been prevalent in other indus-
tries. Because apprenticeships require a long-term investment in
workers, small firms have seen this as a costly and risky endeavor.
However, as many small businesses recognize the benefits of di-
rectly investing in their workforce through apprenticeships, they
are becoming a desirable course of action for employers who are
having trouble hiring qualified employees.
Alongside registered apprenticeships, other work-based learning
opportunities have become popular methods of job training, allow-
ing individuals to gain skills by doing, through things like intern-
ships and job shadowing. With small businesses struggling to find
qualified workers, work-based learning opportunities can help ease
the shortage.
III. HEARINGS
On March 31, 2022, the Subcommittee on Innovation, Entrepre-
neurship, and Workforce Development (Subcommittee) held a hear-
ing to examine the factors contributing to the ongoing labor short-
age. The hearing examined apprenticeships as a workforce develop-
ment strategy to address the current workforce shortage. Sub-
committee Chairman Jason Crow (D–CO) and Subcommittee Rank-
ing Member Young Kim (R–CA) spoke in favor of using apprentice-
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3
ships to build a skilled workforce to meet the needs of small busi-
nesses. Dr. Mordecai Brownlee, President, Community College of
Aurora (CCA), testified that CCA is focusing on career
mentorships, internships, externships, and apprenticeships to level
the playing field for those who have access to supportive networks
and those who are not as privileged. Mr. Joseph Kane, Fellow,
Brookings Institution, testified that apprenticeships and pre-ap-
prenticeships offer an ‘‘earn and learn’’ opportunity, which helps
students gain the necessary skills and qualification to get hired.
IV. COMMITTEE CONSIDERATION
The Committee on Small Business met in open session, with a
quorum being present, on May 11, 2022, and ordered H.R. 7622 fa-
vorably reported to the House of Representatives. During the
markup, no amendments were offered.
V. COMMITTEE VOTES
Clause 3(b) of rule XIII of the Rules of the House of Representa-
tives requires the Committee to list the recorded votes on the mo-
tion to report legislation and amendments thereto. The Committee
voted by voice vote to favorably report H.R. 7622 to the House at
10:41 A.M.
VI. SECTION-BY-SECTION FOR H.R. 7622
Section 1. Short title
This Act may be cited as the ‘‘Small Business Workforce Pipeline
Act of 2022’’.
Section 2. Small Business Development Center apprenticeship pro-
gram assistance
This subsection amends section 21(c)(3) of the Small Business
Act, 15 U.S.C. § 648(c)(1), to add a requirement that allows SBDCs
to provide information and assistance to small businesses on how
to establish and improve apprenticeship programs (as defined in
the National Apprenticeship Act), work-based learning programs
(as defined by the Carl D. Perkins Technical Education Act), pre-
apprenticeship programs, and job training programs, including by
disseminating relevant information from DOL and other relevant
federal agencies.
VII. CONGRESSIONAL BUDGET COST ESTIMATE
The Committee has not requested a cost estimate from the Direc-
tor of the Congressional Budget Office.
VIII. NEW BUDGET AUTHORITY, ENTITLEMENT AUTHORITY, AND TAX
EXPENDITURES
Pursuant to clause 3(c)(2) of rule XIII of the Rules of the House
of Representatives and section 308(a) of the Congressional Budget
Act of 1974, the Committee provides the following opinion and esti-
mate with respect to new budget authority, entitlement authority,
and tax expenditures. While the Committee has not received an es-
timate of new budget authority contained in the cost estimate pre-
pared by the Director of the Congressional Budget Office pursuant
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4
to Sec. 402 of the Congressional Budget Act of 1974, the Committee
does not believe that there will be any additional costs attributable
to this legislation.
IX. COMMITTEE OVERSIGHT FINDINGS AND RECOMMENDATIONS
In accordance with clause 3(c)(1) of rule XIII and clause 2(b)(1)
of rule X of the Rules of the House of Representatives, the over-
sight findings and recommendations of the Committee on Small
Business with respect to the subject matter contained in the H.R.
7622 are incorporated into the descriptive portions of this report.
X. STATEMENT OF GENERAL PERFORMANCE GOALS AND OBJECTIVES
With respect to the requirements of clause 3(c)(4) of rule XIII of
the Rules of the House of Representatives, the performance goals
and objectives of H.R. 7622 are to direct SBDCs to disseminate in-
formation from the Department of Labor regarding Apprentice-
ships, Work-Based Learning Opportunities, Pre-Apprenticeships,
and Job Training Programs.
XI. DUPLICATION OF FEDERAL PROGRAMS
Pursuant to clause 3(c)(5) of rule XIII of the Rules of the House
of Representatives, no provision of H.R. 7622 is known to be dupli-
cative of another Federal program, including any program that was
included in a report to Congress pursuant to section 21 of Public
Law 111–139 or the most recent Catalog of Federal Domestic As-
sistance.
XII. CONGRESSIONAL EARMARKS, LIMITED TAX BENEFITS, AND
LIMITED TARIFF BENEFITS
With respect to clause 9 of rule XXI of the Rules of the House
of Representatives, the Committee finds that the bill does not con-
tain any congressional earmarks, limited tax benefits, or limited
tariff benefits as defined in clause 9(e), 9(f), or 9(g) of rule XXI of
the Rules of the House of Representatives.
XIII. FEDERAL MANDATES STATEMENT
An estimate of Federal mandates prepared by the Director of the
Congressional Budget Office pursuant to section 423 of the Un-
funded Mandates Reform Act was not made available to the Com-
mittee in time for the filing of this report. The Chairwoman of the
Committee shall cause such estimate to be printed in the Congres-
sional Record upon its receipt by the Committee.
XIV. FEDERAL ADVISORY COMMITTEE STATEMENT
No advisory committees within the meaning of section 5(b) of the
Federal Advisory Committee Act were created by this legislation.
XV. APPLICABILITY TO LEGISLATIVE BRANCH
The Committee finds that the legislation does not relate to the
terms and conditions of employment or access to public services or
accommodations within the meaning of section 102(b)(3) of the Con-
gressional Accountability Act.
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XVI. 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, as shown as follows: existing law proposed to be omit-
ted is enclosed in black brackets, new matter is printed in italic,
and existing law in which no change is proposed is shown in
roman:
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 omit-
ted is enclosed in black brackets, new matter is printed in italics,
and existing law in which no change is proposed is shown in
roman):
SMALL BUSINESS ACT
* * * * * * *
SEC. 21. (a)(1) The Administration is authorized to make grants
(including contracts and cooperative agreements) to any State gov-
ernment or any agency thereof, any regional entity, any State-char-
tered development, credit or finance corporation, any women’s busi-
ness center operating pursuant to section 29, any public or private
institution of higher education, including but not limited to any
land-grant college or university, any college or school of business,
engineering, commerce, or agriculture, community college or junior
college, or to any entity formed by two or more of the above entities
(herein referred to as ‘‘applicants’’) to assist in establishing small
business development centers and to any such labor for: small busi-
ness oriented employment or natural resources development pro-
grams; studies, research, and counseling concerning the managing,
financing, and operation of small business enterprises, manage-
ment and technical assistance regarding small business participa-
tion in international markets, export promotion and technology
transfer; delivery or distribution of such services and information;
providing access to business analysts who can refer small business
concerns to available experts; and, to the extent practicable, pro-
viding assistance in furtherance of the Small Business Develop-
ment Center Cyber Strategy developed under section 1841(a) of the
National Defense Authorization Act for Fiscal Year 2017: Provided,
That after December 31, 1990, the Administration shall not make
a grant to any applicant other than an institution of higher edu-
cation or a women’s business center operating pursuant to section
29 as a Small Business Development Center unless the applicant
was receiving a grant (including a contract or cooperative agree-
ment) on such date. The previous sentence shall not apply to an
applicant that has its principal office located in the Commonwealth
of the Northern Mariana Islands. The Administration shall require
any applicant for a small business development center grant with
performance commencing on or after January 1, 1992 to have its
own budget and to primarily utilize institutions of higher education
and women’s business centers operating pursuant to section 29 to
provide services to the small business community. The term of such
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6
grants shall be made on a calendar year basis or to coincide with
the Federal fiscal year.
(2) COOPERATION TO PROVIDE INTERNATIONAL TRADE SERV-
ICES.—
(A) INFORMATION AND SERVICES.—The small business de-
velopment centers shall work in close cooperation with the
Administration’s regional and local offices, the Department
of Commerce, appropriate Federal, State and local agen-
cies (including State trade agencies), and the small busi-
ness community to serve as an active information dissemi-
nation and service delivery mechanism for existing trade
promotion, trade finance, trade adjustment, trade remedy
and trade data collection programs of particular utility for
small businesses.
(B) COOPERATION WITH STATE TRADE AGENCIES AND EX-
PORT ASSISTANCE CENTERS.—A small business development
center that counsels a small business concern on issues re-
lating to international trade shall—
(i) consult with State trade agencies and Export As-
sistance Centers to provide appropriate services to the
small business concern; and
(ii) as necessary, refer the small business concern to
a State trade agency or an Export Assistance Center
for further counseling or assistance.
(C) DEFINITION.—In this paragraph, the term ‘‘Export
Assistance Center’’ has the same meaning as in section 22.
(3) The Small Business Development Center Program shall be
under the general management and oversight of the Administra-
tion for the delivery of programs and services to the small business
community. Such programs and services shall be jointly developed,
negotiated, and agreed upon, with full participation of both parties,
pursuant to an executed cooperative agreement between the Small
Business Development Center applicant and the Administration.
(A) Small business development centers are authorized to form
an association to pursue matters of common concern. If more than
a majority of the small business development centers which are op-
erating pursuant to agreements with the Administration are mem-
bers of such an association, the Administration is authorized and
directed to recognize the existence and activities of such an associa-
tion and to consult with it and develop documents (i) announcing
the annual scope of activities pursuant to this section, (ii) request-
ing proposals to deliver assistance as provided in this section and
(iii) governing the general operations and administration of the
Small Business Development Center Program, specifically includ-
ing the development of regulations and a uniform negotiated coop-
erative agreement for use on an annual basis when entering into
individual negotiated agreements with small business development
centers.
(B) Provisions governing audits, cost principles and administra-
tive requirements for Federal grants, contracts and cooperative
agreements which are included in uniform requirements of Office
of Management and Budget (OMB) Circulars shall be incorporated
by reference and shall not be set forth in summary or other form
in regulations.
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(C) Whereas On an annual basis, the Small Business Devel-
opment Center shall review and coordinate public and private
partnerships and cosponsorships with the Administration for
the purpose of more efficiently leveraging available resources
on a National and a State basis.
(4) SMALL BUSINESS DEVELOPMENT CENTER PROGRAM LEVEL.—
(A) IN GENERAL.—The Administration shall require as a con-
dition of any grant (or amendment or modification thereof)
made to an applicant under this section, that a matching
amount (excluding any fees collected from recipients of such
assistance) equal to the amount of such grant be provided from
sources other than the Federal Government, to be comprised of
not less than 50 percent cash and not more than 50 percent
of indirect costs and in-kind contributions.
(B) RESTRICTION.—The matching amount described in sub-
paragraph (A) shall not include any indirect costs or in-kind
contributions derived from any Federal program.
(C) FUNDING FORMULA.—
(i) IN GENERAL.—Subject to clause (iii), the amount of a
formula grant received by a State under this subparagraph
shall be equal to an amount determined in accordance
with the following formula:
(I) The annual amount made available under section
20(a) for the Small Business Development Center Pro-
gram, less any reductions made for expenses author-
ized by clause (v) of this subparagraph, shall be di-
vided on a pro rata basis, based on the percentage of
the population of each State, as compared to the popu-
lation of the United States.
(II) If the pro rata amount calculated under sub-
clause (I) for any State is less than the minimum
funding level under clause (iii), the Administration
shall determine the aggregate amount necessary to
achieve that minimum funding level for each such
State.
(III) The aggregate amount calculated under sub-
clause (II) shall be deducted from the amount cal-
culated under subclause (I) for States eligible to re-
ceive more than the minimum funding level. The de-
ductions shall be made on a pro rata basis, based on
the population of each such State, as compared to the
total population of all such States.
(IV) The aggregate amount deducted under sub-
clause (III) shall be added to the grants of those States
that are not eligible to receive more than the min-
imum funding level in order to achieve the minimum
funding level for each such State, except that the eligi-
ble amount of a grant to any State shall not be re-
duced to an amount below the minimum funding level.
(ii) GRANT DETERMINATION.—The amount of a grant that
a State is eligible to apply for under this subparagraph
shall be the amount determined under clause (i), subject to
any modifications required under clause (iii), and shall be
based on the amount available for the fiscal year in which
performance of the grant commences, but not including
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amounts distributed in accordance with clause (iv). The
amount of a grant received by a State under any provision
of this subparagraph shall not exceed the amount of
matching funds from sources other than the Federal Gov-
ernment, as required under subparagraph (A).
(iii) MINIMUM FUNDING LEVEL.—The amount of the min-
imum funding level for each State shall be determined for
each fiscal year based on the amount made available for
that fiscal year to carry out this section, as follows:
(I) If the amount made available is not less than
$81,500,000 and not more than $90,000,000, the min-
imum funding level shall be $500,000.
(II) If the amount made available is less than
$81,500,000, the minimum funding level shall be the
remainder of $500,000 minus a percentage of $500,000
equal to the percentage amount by which the amount
made available is less than $81,500,000.
(III) If the amount made available is more than
$90,000,000, the minimum funding level shall be the
sum of $500,000 plus a percentage of $500,000 equal
to the percentage amount by which the amount made
available exceeds $90,000,000.
(iv) DISTRIBUTIONS.—Subject to clause (iii), if any State
does not apply for, or use, its full funding eligibility for a
fiscal year, the Administration shall distribute the remain-
ing funds as follows:
(I) If the grant to any State is less than the amount
received by that State in fiscal year 2000, the Admin-
istration shall distribute such remaining funds, on a
pro rata basis, based on the percentage of shortage of
each such State, as compared to the total amount of
such remaining funds available, to the extent nec-
essary in order to increase the amount of the grant to
the amount received by that State in fiscal year 2000,
or until such funds are exhausted, whichever first oc-
curs.
(II) If any funds remain after the application of sub-
clause (I), the remaining amount may be distributed
as supplemental grants to any State, as the Adminis-
tration determines, in its discretion, to be appropriate,
after consultation with the association referred to in
subsection (a)(3)(A).
(v) USE OF AMOUNTS.—
(I) IN GENERAL.—Of the amounts made available in
any fiscal year to carry out this section—
(aa) not more than $500,000 may be used by the
Administration to pay expenses enumerated in
subparagraphs (B) through (D) of section 20(a)(1);
and
(bb) not more than $500,000 may be used by the
Administration to pay the examination expenses
enumerated in section 20(a)(1)(E).
(II) LIMITATION.—No funds described in subclause
(I) may be used for examination expenses under sec-
tion 20(a)(1)(E) if the usage would reduce the amount
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9
of grants made available under clause (i)(I) of this sub-
paragraph to less than $85,000,000 (after excluding
any amounts provided in appropriations Acts, or ac-
companying report language, for specific institutions
or for purposes other than the general small business
development center program) or would further reduce
the amount of such grants below such amount.
(vi) EXCLUSIONS.—Grants provided to a State by the Ad-
ministration or another Federal agency to carry out sub-
section (a)(6) or (c)(3)(G), or for supplemental grants set
forth in clause (iv)(II) of this subparagraph, shall not be
included in the calculation of maximum funding for a
State under clause (ii) of this subparagraph.
(vii) AUTHORIZATION OF APPROPRIATIONS.—There are au-
thorized to be appropriated to carry out this subpara-
graph—
(I) $130,000,000 for fiscal year 2005; and
(II) $135,000,000 for fiscal year 2006.
(viii) LIMITATION.—From the funds appropriated pursu-
ant to clause (vii), the Administration shall reserve not
less than $1,000,000 in each fiscal year to develop portable
assistance for startup and sustainability non-matching
grant programs to be conducted by eligible small business
development centers in communities that are economically
challenged as a result of a business or government facility
down sizing or closing, which has resulted in the loss of
jobs or small business instability. A non-matching grant
under this clause shall not exceed $100,000, and shall be
used for small business development center personnel ex-
penses and related small business programs and services.
(ix) STATE DEFINED.—In this subparagraph, the term
‘‘State’’ means each of the several States, the District of
Columbia, the Commonwealth of Puerto Rico, the Virgin
Islands, Guam, American Samoa, and the Commonwealth
of the Northern Mariana Islands.
(5) FEDERAL CONTRACTS WITH SMALL BUSINESS DEVELOPMENT
CENTERS.—
(A) IN GENERAL.—Subject to the conditions set forth in sub-
paragraph (B), a small business development center may enter
into a contract with a Federal department or agency to provide
specific assistance to small business concerns.
(B) CONTRACT PREREQUISITES.—Before bidding on a contract
described in subparagraph (A), a small business development
center shall receive approval from the Associate Administrator
of the small business development center program of the sub-
ject and general scope of the contract. Each approval under
subparagraph (A) shall be based upon a determination that the
contract will provide assistance to small business concerns and
that performance of the contract will not hinder the small busi-
ness development center in carrying out the terms of the grant
received by the small business development center from the
Administration.
(C) EXEMPTION FROM MATCHING REQUIREMENT.—A contract
under this paragraph shall not be subject to the matching
funds or eligibility requirements of paragraph (4).
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10
(D) ADDITIONAL PROVISION.—Notwithstanding any other pro-
vision of law, a contract for assistance under this paragraph
shall not be applied to any Federal department or agency’s
small business, woman-owned business, or socially and eco-
nomically disadvantaged business contracting goal under sec-
tion 15(g).
(6) Any applicant which is funded by the Administration as
a Small Business Development Center may apply for an addi-
tional grant to be used solely to assist—
(A) with the development and enhancement of exports by
small business concerns;
(B) in technology transfer; and
(C) with outreach, development, and enhancement of mi-
nority-owned small business startups or expansions,
HUBZone small business concerns, veteran-owned small
business startups or expansions, and women-owned small
business startups or expansions, in communities impacted
by base closings or military or corporate downsizing, or in
rural or underserved communities;
as provided under subparagraphs (B) through (G) of subsection
(c)(3). Applicants for such additional grants shall comply with
all of the provisions of this section, including providing match-
ing funds, except that funding under this paragraph shall be
effective for any fiscal year to the extent provided in advance
in appropriations Acts and shall be in addition to the dollar
program limitations specified in paragraphs (4) and (5). No re-
cipient of funds under this paragraph shall receive a grant
which would exceed its pro rata share of a $15,000,000 pro-
gram based upon the populations to be served by the Small
Business Development Center as compared to the total popu-
lation of the United States. The minimum amount of eligibility
for any State shall be $100,000.
(7) PRIVACY REQUIREMENTS.—
(A) IN GENERAL.—A small business development center,
consortium of small business development centers, or con-
tractor or agent of a small business development center
may not disclose the name, address, or telephone number
of any individual or small business concern receiving as-
sistance under this section without the consent of such in-
dividual or small business concern, unless—
(i) the Administrator is ordered to make such a dis-
closure by a court in any civil or criminal enforcement
action initiated by a Federal or State agency; or
(ii) the Administrator considers such a disclosure to
be necessary for the purpose of conducting a financial
audit of a small business development center, but a
disclosure under this clause shall be limited to the in-
formation necessary for such audit.
(B) ADMINISTRATOR USE OF INFORMATION.—This section
shall not—
(i) restrict Administrator access to program activity
data; or
(ii) prevent the Administrator from using client in-
formation to conduct client surveys.
(C) REGULATIONS.—
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11
(i) IN GENERAL.—The Administrator shall issue reg-
ulations to establish standards—
(I) for disclosures with respect to financial au-
dits under subparagraph (A)(ii); and
(II) for client surveys under subparagraph
(B)(ii), including standards for oversight of such
surveys and for dissemination and use of client in-
formation.
(ii) MAXIMUM PRIVACY PROTECTION.—Regulations
under this subparagraph, shall, to the extent prac-
ticable, provide for the maximum amount of privacy
protection.
(iii) INSPECTOR GENERAL.—Until the effective date of
regulations under this subparagraph, any client sur-
vey and the use of such information shall be approved
by the Inspector General who shall include such ap-
proval in his semi-annual report.
(8) CYBERSECURITY ASSISTANCE.—
(A) IN GENERAL.—The Department of Homeland Secu-
rity, and any other Federal department or agency in co-
ordination with the Department of Homeland Security,
may leverage small business development centers to pro-
vide assistance to small business concerns by dissemi-
nating information relating to cybersecurity risks and
other homeland security matters to help small business
concerns in developing or enhancing cybersecurity infra-
structure, awareness of cyber threat indicators, and cyber
training programs for employees.
(B) DEFINITIONS.—In this paragraph, the terms ‘‘cyberse-
curity risk’’ and ‘‘cyber threat indicator’’ have the mean-
ings given such terms, respectively, under section 2209(a)
of the Homeland Security Act of 2002.
(b)(1) Financial assistance shall not be made available to any ap-
plicant if approving such assistance would be inconsistent with a
plan for the area involved which has been adopted by an agency
recognized by the State government as authorized to do so and ap-
proved by the Administration in accordance with the standards and
requirements established pursuant to this section.
(2) An applicant may apply to participate in the program by sub-
mitting to the Administration for approval a plan naming those au-
thorized in subsection (a) to participate in the program, the geo-
graphic area to be served, the services that it would provide, the
method for delivering services, a budget, and any other information
and assurances the Administration may require to insure that the
applicant will carry out the activities eligible for assistance. The
Administration is authorized to approve, conditionally approve or
reject a plan or combination of plans submitted. In all cases, the
Administration shall review plans for conformity with the plan sub-
mitted pursuant to paragraph (1) of this subsection, and with a
view toward providing small business with the most comprehensive
and coordinated assistance in the State or part thereof to be
served.
(3) ASSISTANCE TO OUT-OF-STATE SMALL BUSINESS CON-
CERNS.—
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12
(A) IN GENERAL.—At the discretion of the Administra-
tion, the Administration is authorized to permit a small
business development center to provide advice, information
and assistance, as described in subsection (c), to small
businesses located outside the State, but only to the extent
such businesses are located within close geographical prox-
imity to the small business development center, as deter-
mined by the Administration.
(B) DISASTER RECOVERY ASSISTANCE.—
(i) IN GENERAL.—At the discretion of the Adminis-
trator, the Administrator may authorize a small busi-
ness development center to provide advice, informa-
tion, and assistance, as described in subsection (c), to
a small business concern located outside of the State,
without regard to geographic proximity to the small
business development center, if the small business
concern is located in an area for which the President
has declared a major disaster.
(ii) TERM.—
(I) IN GENERAL.—A small business development
center may provide advice, information, and as-
sistance to a small business concern under clause
(i) for a period of not more than 2 years after the
date on which the President declared a major dis-
aster for the area in which the small business con-
cern is located.
(II) EXTENSION.—The Administrator may, at the
discretion of the Administrator, extend the period
described in subclause (I).
(iii) CONTINUITY OF SERVICES.—A small business de-
velopment center that provides counselors to an area
described in clause (i) shall, to the maximum extent
practicable, ensure continuity of services in any State
in which the small business development center other-
wise provides services.
(iv) ACCESS TO DISASTER RECOVERY FACILITIES.—For
purposes of this subparagraph, the Administrator
shall, to the maximum extent practicable, permit the
personnel of a small business development center to
use any site or facility designated by the Adminis-
trator for use to provide disaster recovery assistance.
(c)(1) Applicants receiving grants under this section shall assist
small businesses in solving problems concerning operations, manu-
facturing, engineering, technology exchange and development, per-
sonnel administration, marketing, sales, merchandising, finance,
accounting, business strategy development, and other disciplines
required for small business growth and expansion, innovation, in-
creased productivity, and management improvement, and for de-
creasing industry economic concentrations. Applicants receiving
grants under this section may also assist small businesses by pro-
viding, where appropriate, education on the requirements applica-
ble to small businesses under the regulations issued under section
38 of the Arms Export Control Act (22 U.S.C. 2778) and on compli-
ance with those requirements.
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(2) A small business development center shall provide services as
close as possible to small businesses by providing extension serv-
ices and utilizing satellite locations when necessary. The facilities
and staff of each Small Business Development Center shall be lo-
cated in such places as to provide maximum accessibility and bene-
fits to the small businesses which the center is intended to serve.
To the extent possible, it also shall make full use of other Federal
and State government programs that are concerned with aiding
small business. A small business development center shall have—
(A) a full-time staff, including a full-time director who shall
have the authority to make expenditures under the center’s
budget and who shall manage the program activities;
(B) access to business analysts to counsel, assist, and inform
small business clients;
(C) access to technology transfer agent to provide state or art
technology to small businesses through coupling with national
and regional technology data sources;
(D) access to information specialists to assist in providing in-
formation searches and referrals to small business;
(E) access to part-time professional specialists to conduct re-
search or to provide counseling assistance whenever the need
arises;
(F) access to laboratory and adaptive engineering facilities;
and
(G) access to cybersecurity specialists to counsel, assist, and
inform small business concern clients, in furtherance of the
Small Business Development Center Cyber Strategy developed
under section 1841(a) of the National Defense Authorization
Act for Fiscal Year 2017.
(3) Services provided by a small business development center
shall include, but shall not be limited to—
(A) furnishing one-to-one individual counseling to small busi-
nesses, including—
(i) working with individuals to increase awareness of
basic credit practices and credit requirements;
(ii) working with individuals to develop business plans,
financial packages, credit applications, and contract pro-
posals;
(iii) working with the Administration to develop and pro-
vide informational tools for use in working with individ-
uals on pre-business startup planning, existing business
expansion, and export planning; and
(iv) working with individuals referred by the local offices
of the Administration and Administration participating
lenders;
(B) assisting in technology transfer, research and develop-
ment, including applied research, and coupling from existing
sources to small businesses, including—
(i) working to increase the access of small businesses to
the capabilities of automated flexible manufacturing sys-
tems;
(ii) working through existing networks and developing
new networks for technology transfer that encourage part-
nership between the small business and academic commu-
nities to help commercialize university-based research and
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14
development and introduce university-based engineers and
scientists to their counterparts in small technology-based
firms; and
(iii) exploring the viability of developing shared produc-
tion facilities, under appropriate circumstances;
(C) in cooperation with the Department of Commerce and
other relevant Federal agencies, actively assisting small busi-
nesses in exporting by identifying and developing potential ex-
port markets, facilitating export transactions, developing link-
ages between United States small business firms and
prescreened foreign buyers, assisting small businesses to par-
ticipate in international trade shows, assisting small busi-
nesses in obtaining export financing, and facilitating the devel-
opment or reorientation of marketing and production strate-
gies; where appropriate, the Small Business Development Cen-
ter and the Administration may work in cooperation with the
State to establish a State international trade center for these
purposes;
(D) developing a program in conjunction with the Export-Im-
port Bank and local and regional Administration offices that
will enable Small Business Development Centers to serve as
an information network and to assist small business applicants
for Export-Import Bank financing programs, and otherwise
identify and help to make available export financing programs
to small businesses;
(E) working closely with the small business community,
small business consultants, State agencies, universities and
other appropriate groups to make translation services more
readily available to small business firms doing business, or at-
tempting to develop business, in foreign markets;
(F) in providing assistance under this subsection, applicants
shall cooperate with the Department of Commerce and other
relevant Federal agencies to increase access to available export
market information systems, including the CIMS system;
(G) assisting small businesses to develop and implement
strategic business plans to timely and effectively respond to
the planned closure (or reduction) of a Department of Defense
facility within the community, or actual or projected reductions
in such firms’ business base due to the actual or projected ter-
mination (or reduction) of a Department of Defense program or
a contract in support of such program—
(i) by developing broad economic assessments of the ad-
verse impacts of—
(I) the closure (or reduction) of the Department of
Defense facility on the small business concerns pro-
viding goods or services to such facility or to the mili-
tary and civilian personnel currently stationed or
working at such facility; and
(II) the termination (or reduction) of a Department
of Defense program (or contracts under such program)
on the small business concerns participating in such
program as a prime contractor, subcontractor or sup-
plier at any tier;
(ii) by developing, in conjunction with appropriate Fed-
eral, State, and local governmental entities and other pri-
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15
vate sector organizations, the parameters of a transition
adjustment program adaptable to the needs of individual
small business concerns;
(iii) by conducting appropriate programs to inform the
affected small business community regarding the antici-
pated adverse impacts identified under clause (i) and the
economic adjustment assistance available to such firms;
and
(iv) by assisting small business concerns to develop and
implement an individualized transition business plan.
(H) maintaining current information concerning Federal,
State, and local regulations that affect small businesses and
counsel small businesses on methods of compliance. Counseling
and technology development shall be provided when necessary
to help small businesses find solutions for complying with envi-
ronmental, energy, health, safety, and other Federal, State,
and local regulations;
(I) coordinating and conducting research into technical and
general small business problems for which there are no ready
solutions;
(J) providing and maintaining a comprehensive library that
contains current information and statistical data needed by
small businesses;
(K) maintaining a working relationship and open commu-
nications with the financial and investment communities, legal
associations, local and regional private consultants, and local
and regional small business groups and associations in order
to help address the various needs of the small business com-
munity;
(L) conducting in-depth surveys for local small business
groups in order to develop general information regarding the
local economy and general small businesses strengths and
weaknesses in the locality;
(M) in cooperation with the Department of Commerce, the
Administration and other relevant Federal agencies, actively
assisting rural small businesses in exporting by identifying
and developing potential export markets for rural small busi-
nesses, facilitating export transactions for rural small busi-
nesses, developing linkages between United States’ rural small
businesses and prescreened foreign buyers, assisting rural
small businesses to participate in international trade shows,
assisting rural small businesses in obtaining export financing
and developing marketing and production strategies;
(N) assisting rural small businesses—
(i) in developing marketing and production strategies
that will enable them to better compete in the domestic
market—
(ii) by providing technical assistance needed by rural
small businesses;
(iii) by making available managerial assistance to rural
small business concerns; and
(iv) by providing information and assistance in obtaining
financing for business startups and expansion;
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(O) in conjunction with the United States Travel and Tour-
ism Administration, assist rural small business in developing
the tourism potential of rural communities by—
(i) identifying the cultural, historic, recreational, and
scenic resources of such communities;
(ii) providing assistance to small businesses in devel-
oping tourism marketing and promotion plans relating to
tourism in rural areas; and
(iii) assisting small business concerns to obtain capital
for starting or expanding businesses primarily serving
tourists;
(P) maintaining lists of local and regional private consultants
to whom small business can be referred;
(Q) providing information to small business concerns regard-
ing compliance with regulatory requirements;
(R) developing informational publications, establishing re-
source centers of reference materials, and distributing compli-
ance guides published under section 312(a) of the Small Busi-
ness Regulatory Enforcement Fairness Act of 1996;
(S) providing small business owners with access to a wide
variety of export-related information by establishing on-line
computer linkages between small business development cen-
ters and an international trade data information network with
ties to the Export Assistance Center program;
(T) providing information and assistance to small business
concerns with respect to establishing drug-free workplace pro-
grams on or before October 1, 2006; øand¿
(U) encouraging and assisting the provision of succession
planning to small business concerns with a focus on
transitioning to cooperatives, as defined in section 7(a)(35), and
qualified employee trusts (collectively referred to in this sub-
paragraph as ‘‘employee-owned business concerns’’), including
by—
(i) providing training to individuals to promote the suc-
cessful management, governance, or operation of a busi-
ness purchased by those individuals in the formation of an
employee-owned business concern;
(ii) assisting employee-owned business concerns that
meet applicable size standards established under section
3(a) with education and technical assistance with respect
to financing and contracting programs administered by the
Administration;
(iii) coordinating with lenders on conducting outreach on
financing through programs administered by the Adminis-
tration that may be used to support the transition of own-
ership to employees;
(iv) supporting small business concerns in exploring or
assessing the possibility of transitioning to an employee-
owned business concern; and
(v) coordinating with the cooperative development cen-
ters of the Department of Agriculture, the land grant ex-
tension network, the Manufacturing Extension Partner-
ship, community development financial institutions, em-
ployee ownership associations and service providers, and
local, regional and national cooperative associationsø.¿;
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17
ø(U)¿ (V) in conjunction with the United States Patent and
Trademark Office, providing training—
(i) to small business concerns relating to—
(I) domestic and international intellectual property
protections; and
(II) how the protections described in subclause (I)
should be considered in the business plans and growth
strategies of the small business concerns; and
(ii) that may be delivered—
(I) in person; or
(II) through a websiteø.¿; and
(W) providing information and assistance to small business
concerns, including by disseminating relevant information from
the Department of Labor and other Federal agencies, on how to
establish and improve—
(i) work-based learning opportunities (as defined in sec-
tion 3 of the Carl D. Perkins Career and Technical Edu-
cation Act of 2006 (20 U.S.C. 2302));
(ii) apprenticeship programs registered under the Act of
August 16, 1937 (50 Stat. 664, chapter 663; commonly
known as the ‘‘National Apprenticeship Act’’; 29 U.S.C. 50
et seq.);
(iii) pre-apprenticeship programs; and
(iv) job training programs.
(4) A small business development center shall continue to up-
grade and modify its services, as needed, in order to meet the
changing and evolving needs of the small business community.
(5) In addition to the methods prescribed in section 21(c)(2), a
small business development center shall utilize and compensate as
one of its resources qualified small business vendors, including but
not limited to, private management consultants, private consulting
engineers and private testing laboratories, to provide services as
described in this subsection to small businesses on behalf of such
small business development center.
(6) In any State (A) in which the Administration has not made
a grant pursuant to paragraph (1) of subsection (a), or (B) in which
no application for a grant has been made by a Small Business De-
velopment Center pursuant to paragraph (6) of such subsection
within 60 days after the effective date of any grant under sub-
section (a)(1) to such center or the date the Administration notifies
the grantee funded under subsection (a)(1) that funds are available
for grant applications pursuant to subsection (a)(6), whichever date
occurs last, the Administration may make grants to a non-profit
entity in that State to carry out the activities specified in para-
graph (6) of subsection (a). Any such applicants shall comply with
the matching funds requirement of paragraph (4) of subsection (a).
Such grants shall be effective for any fiscal year only to the extent
provided in advance in appropriations Acts, and each State shall be
limited to the pro rata share provisions of paragraph (6) of sub-
section (a).
(7) In performing the services identified in paragraph (3), the
Small Business Development Centers shall work in close co-
operation with the Administration’s regional and local offices,
the local small business community, and appropriate State and
local agencies.
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(8) The Associate Administrator for Small Business Develop-
ment Centers, in consultation with the Small Business Devel-
opment Centers, shall develop and implement an information
sharing system. Subject to amounts approved in advance in ap-
propriations Acts, the Administration may make grants or
enter cooperative agreements with one or more centers to carry
out the provisions of this paragraph. Said grants or cooperative
agreements shall be awarded for periods of no more than five
years duration. The matching funds provisions of subsection (a)
shall not be applicable to grants or cooperative agreements
under this paragraph. The system shall—
(A) allow Small Business Development Centers partici-
pating in the program to exchange information about their
programs; and
(B) provide information central to technology transfer.
(d) Where appropriate, the Small Business Development Centers
shall work in conjunction with the relevant State agency and the
Department of Commerce to develop a comprehensive plan for en-
hancing the export potential of small businesses located within the
State. This plan may involve the cofunding and staffing of a State
Office of International Trade within the State Small Business De-
velopment Center, using joint State and Federal funding, and any
other appropriate measures directed at improving the export per-
formance of small businesses within the State.
(e) Laboratories operated and funded by the Federal Government
are authorized and directed to cooperate with the Administration
in developing and establishing programs to support small business
development centers by making facilities and equipment available;
providing experiment station capabilities in adaptive engineering;
providing library and technical information processing capabilities;
and providing professional staff for consulting. The Administration
is authorized to reimburse the laboratories for such services.
(f) The National Science Foundation is authorized and directed
to cooperate with the Administration and with the Small Business
Development Centers in developing and establishing programs to
support the centers.
(g) NATIONAL AERONAUTICS AND SPACE ADMINISTRATION AND RE-
GIONAL TECHNOLOGY TRANSFER CENTERS.—The National Aero-
nautics and Space Administration and regional technology transfer
centers supported by the National Aeronautics and Space Adminis-
tration are authorized and directed to cooperate with small busi-
ness development centers participating in the program.
(h) ASSOCIATE ADMINISTRATOR FOR SMALL BUSINESS DEVELOP-
MENT CENTERS.—
(1) APPOINTMENT AND COMPENSATION.—The Administrator
shall appoint an Associate Administrator for Small Business
Development Centers who shall report to an official who is not
more than one level below the Office of the Administrator and
who shall serve without regard to the provisions of title 5, gov-
erning appointments in the competitive service, and without
regard to chapter 51, and subchapter III of chapter 53 of such
title relating to classification and General Schedule pay rates,
but at a rate not less than the rate of GS–17 of the General
Schedule.
(2) DUTIES.—
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19
(A) IN GENERAL.—The sole responsibility of the Associate
Administrator for Small Business Development Centers
shall be to administer the small business development cen-
ter program. Duties of the position shall include recom-
mending the annual program budget, reviewing the annual
budgets submitted by each applicant, establishing appro-
priate funding levels therefore, selecting applicants to par-
ticipate in this program, implementing the provisions of
this section, maintaining a clearinghouse to provide for the
dissemination and exchange of information between small
business development centers and conducting audits of re-
cipients of grants under this section.
(B) CONSULTATION REQUIREMENTS.—In carrying out the
duties described in this subsection, the Associate Adminis-
trator shall confer with and seek the advice of the Board
established by subsection (i) and Administration officials
in areas served by the small business development centers;
however, the Associate Administrator shall be responsible
for the management and administration of the program
and shall not be subject to the approval or concurrence of
such Administration officials.
(i)(1) There is established a National Small Business Develop-
ment Center Advisory Board (herein referred to as ‘‘Board’’) which
shall consist of nine members appointed from civilian life by the
Administrator and who shall be persons of outstanding qualifica-
tions known to be familiar and sympathetic with small business
needs and problems. No more than three members shall be from
universities or their affiliates and six shall be from small busi-
nesses or associations representing small businesses. At the time
of the appointment of the Board, the Administrator shall designate
one-third of the members and at least one from each category
whose term shall end in two years from the date of appointment,
a second third whose term shall end in three years from the date
of appointment, and the final third whose term shall end in four
years from the date of appointment. Succeeding Boards shall have
three-year terms, with one-third of the Board changing each year.
(2) The Board shall elect a Chairman and advise, counsel, and
confer with the Associate Administrator for Small Business Devel-
opment Centers in carrying out the duties described in this section.
The Board shall meet at least semiannually and at the call of the
Chairman of the Board. Each member of the Board shall be enti-
tled to be compensated at the rate not in excess of the per diem
equivalent of the highest rate of pay for individuals occupying the
position under GS–18 of the General Schedule for each day en-
gaged in activities of the Board and shall be entitled to be reim-
bursed for expenses as a member of the Board.
(j)(1) Each small business development center shall establish an
advisory board.
(2) Each small business development center advisory board shall
elect a chairman and advise, counsel, and confer with the director
of the small business development center on all policy matters per-
taining to the operation of the small business development center,
including who may be eligible to receive assistance from, and how
local and regional private consultants may participate with the
small business development center.
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20
(k) PROGRAM EXAMINATION AND ACCREDITATION.—
(1) EXAMINATION.—Not later than 180 days after the date of
enactment of this subsection, the Administration shall develop
and implement a biennial programmatic and financial exam-
ination of each small business development center established
pursuant to this section.
(2) ACCREDITATION.—The Administration may provide finan-
cial support, by contract or otherwise, to the association au-
thorized by subsection (a)(3)(A) for the purpose of developing a
small business development center accreditation program.
(3) EXTENSION OR RENEWAL OF COOPERATIVE AGREEMENTS.—
(A) IN GENERAL.—In extending or renewing a cooperative
agreement of a small business development center, the Ad-
ministration shall consider the results of the examination
and accreditation program conducted pursuant to para-
graphs (1) and (2).
(B) ACCREDITATION REQUIREMENT.—After September 30,
2000, the Administration may not renew or extend any co-
operative agreement with a small business development
center unless the center has been approved under the ac-
creditation program conducted pursuant to this subsection,
except that the Associate Administrator for Small Business
Development Centers may waive such accreditation re-
quirement, in the discretion of the Associate Adminis-
trator, upon a showing that the center is making a good
faith effort to obtain accreditation.
(l) CONTRACT AUTHORITY.—The authority to enter into contracts
shall be in effect for each fiscal year only to the extent and in the
amounts as are provided in advance in appropriations Acts. After
the administration has entered a contract, either as a grant or a
cooperative agreement, with any applicant under this section, it
shall not suspend, terminate, or fail to renew or extend any such
contract unless the Administration provides the applicant with
written notification setting forth the reasons therefore and afford-
ing the applicant an opportunity for a hearing, appeal, or other ad-
ministrative proceeding under the provisions of chapter 5 of title 5,
United States Code. If any contract or cooperative agreement under
this section with an entity that is covered by this section is not re-
newed or extended, any award of a successor contract or coopera-
tive agreement under this section to another entity shall be made
on a competitive basis.
(m) PROHIBITION ON CERTAIN FEES.—A small business develop-
ment center shall not impose or otherwise collect a fee or other
compensation in connection with the provision of counseling serv-
ices under this section.
(n) VETERANS ASSISTANCE AND SERVICES PROGRAM.—
(1) IN GENERAL.—A small business development center may
apply for a grant under this subsection to carry out a veterans
assistance and services program.
(2) ELEMENTS OF PROGRAM.—Under a program carried out
with a grant under this subsection, a small business develop-
ment center shall—
(A) create a marketing campaign to promote awareness
and education of the services of the center that are avail-
able to veterans, and to target the campaign toward vet-
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21
erans, service-disabled veterans, military units, Federal
agencies, and veterans organizations;
(B) use technology-assisted online counseling and dis-
tance learning technology to overcome the impediments to
entrepreneurship faced by veterans and members of the
Armed Forces; and
(C) increase coordination among organizations that as-
sist veterans, including by establishing virtual integration
of service providers and offerings for a one-stop point of
contact for veterans who are entrepreneurs or owners of
small business concerns.
(3) AMOUNT OF GRANTS.—A grant under this subsection shall
be for not less than $75,000 and not more than $250,000.
(4) FUNDING.—Subject to amounts approved in advance in
appropriations Acts, the Administration may make grants or
enter into cooperative agreements to carry out the provisions
of this subsection.
* * * * * * *
Æ
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