[Congressional Bills 115th Congress]
[From the U.S. Government Publishing Office]
[H.R. 2488 Introduced in House (IH)]
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115th CONGRESS
1st Session
H. R. 2488
To provide for small business concerns located in Puerto Rico, and for
other purposes.
_______________________________________________________________________
IN THE HOUSE OF REPRESENTATIVES
May 17, 2017
Ms. Velazquez (for herself, Miss Gonzalez-Colon of Puerto Rico, Mr.
Serrano, Mr. MacArthur, Mr. Soto, Mr. Duffy, and Mrs. Murphy of
Florida) introduced the following bill; which was referred to the
Committee on Small Business
_______________________________________________________________________
A BILL
To provide for small business concerns located in Puerto Rico, and for
other purposes.
Be it enacted by the Senate and House of Representatives of the
United States of America in Congress assembled,
SECTION 1. SHORT TITLE.
This Act may be cited as the ``Puerto Rico Small Business
Assistance Act of 2017''.
SEC. 2. TABLE OF CONTENTS.
The table of contents for this Act is as follows:
Sec. 1. Short title.
Sec. 2. Table of contents.
Sec. 3. Definitions.
TITLE I--LENDING
Sec. 101. Microloan program for Puerto Rico small business concerns.
Sec. 102. Fee reductions.
Sec. 103. Economic stimulus lending program for small businesses.
Sec. 104. Contribution percentages for 504 projects.
Sec. 105. Independent subsidy calculation.
TITLE II--PROCUREMENT
Sec. 201. Contracting preference for Puerto Rico businesses.
Sec. 202. Priority for surplus property transfers.
Sec. 203. Subcontracting incentives for protege firms that are Puerto
Rico businesses.
Sec. 204. Additional mentor-protege relationships for protege firms
that are Puerto Rico businesses.
TITLE III--ENTREPRENEURIAL DEVELOPMENT
Sec. 301. Veteran Business Outreach Center in Puerto Rico.
Sec. 302. FAST grant program for Puerto Rico.
TITLE IV--SMALL BUSINESS ADMINISTRATION OVERSIGHT
Sec. 401. Requirement for the District Director of Puerto Rico.
SEC. 3. DEFINITIONS.
(a) This Act.--In this subtitle:
(1) Administrator.--The term ``Administrator'' means the
Administrator of the Small Business Administration.
(2) Oversight board termination date.--The term ``Oversight
Board termination date'' means the date on which the Oversight
Board established under section 101 of the Puerto Rico
Oversight, Management, and Economic Stability Act (48 U.S.C.
2121) terminates.
(3) Puerto rico.--The term ``Puerto Rico'' means the
Commonwealth of Puerto Rico.
(4) Puerto rico business.--The term ``Puerto Rico
business'' means a small business concern that has its
principal office located in the Commonwealth of Puerto Rico.
(5) Small business concern.--The term ``small business
concern'' has the meaning given such term under section 3 of
the Small Business Act (15 U.S.C. 632).
(b) Small Business Act.--Section 3 of the Small Business Act (15
U.S.C. 632) is amended by adding at the end the following:
``(ee) Puerto Rico Business.--In this Act, the term `Puerto Rico
business' means a small business concern that has its principal office
located in the Commonwealth of Puerto Rico.''.
TITLE I--LENDING
SEC. 101. MICROLOAN PROGRAM FOR PUERTO RICO SMALL BUSINESS CONCERNS.
(a) Increase in Access to Capital for Certain Intermediaries.--
Section 7(m)(3)(C) of the Small Business Act (15 U.S.C. 636(m)(3)(C))
is amended--
(1) by inserting ``and except as provided in clause (ii)''
after ``subsection (a)(3)'';
(2) by striking ``Notwithstanding'' and inserting the
following:
``(i) In general.--Notwithstanding''; and
(3) by adding at the end the following:
``(ii) Exception for certain puerto rico
businesses.--
``(I) In general.--No loan shall be
made under this subsection if the total
amount outstanding and committed to 1
covered intermediary (excluding
outstanding grants) from the business
loan and investment fund established by
this Act would, as a result of such
loan, exceed $6,000,000 in the
remaining years of the covered
intermediary's participation in the
program.
``(II) Definition.--In this clause,
the term `covered intermediary' means
an intermediary that--
``(aa) is participating in
the program; and
``(bb) submits to the
Administrator a certification
that not less than 20 percent
of the microloans made by the
intermediary under this
subsection, during such period
as the Administrator may
specify, will be made to Puerto
Rico businesses.''.
(b) Waiver of 25/75 Rule for Microloans to Puerto Rico Small
Business Concerns.--
(1) Waiver authorized.--Section 7(m)(4)(E) of the Small
Business Act (15 U.S.C. 636(m)(4)(E)) is amended--
(A) in clause (i), by striking ``Each'' and
inserting ``Except as provided in clause (iii), each'';
and
(B) by adding at the end the following:
``(iii) Exception for certain
intermediaries.--The Administrator shall waive
the requirements of clause (i) for an
intermediary for which not less than 25 percent
of the loans made by the intermediary are made
to Puerto Rico businesses.''.
(2) Study.--Not later than 18 months after the date of
enactment of this Act, the Administrator shall submit to
Congress a report on the impact of waiving the requirements of
section 7(m)(4)(E)(i) of the Small Business Act for all
intermediaries receiving grant funds under section
7(m)(1)(B)(ii) of the Small Business Act, which shall include
an analysis of the effectiveness and feasibility of expanding
the waiver to small business concerns nationwide.
(c) Prospective Repeal.--Subsections (a) and (b) shall be repealed,
and the provisions of law amended by such subsections shall be restored
as if such subsections had not been enacted, on the Oversight Board
termination date.
(d) GAO Study.--Not later than 180 days after the date of enactment
of this Act, the Comptroller General of the United States shall
complete a study and submit to the Committee on Small Business and
Entrepreneurship of the Senate and the Committee on Small Business of
the House of Representatives a report on the following:
(1) The operations (including services provided, structure,
size, and area of operation) of a representative sample of--
(A) intermediaries that are eligible for
participation in the microloan program under section
7(m) of the Small Business Act (15 U.S.C. 636(m)) and
that participate in the microloan program; and
(B) intermediaries (including those operated for
profit, operated as nonprofit organizations, and
affiliated with a United States institution of higher
learning (as defined in section 3452 of title 38,
United States Code) that are so eligible and that do
not participate in the microloan program.
(2) The reasons why intermediaries described in paragraph
(1)(B) choose not to participate in the microloan program.
(3) Recommendations on how to encourage increased
participation in the microloan program by intermediaries
described in paragraph (1)(B).
(4) Recommendations for increasing the number of
intermediaries located in the territories of the United States
or in economically distressed areas (as defined in section
7(m)(11)(D) of the Small Business Act (15 U.S.C. 636(m)(11)(D))
that are eligible for participation in the microloan program
under section 7(m) of such Act.
(5) Recommendations on how to decrease the costs associated
with participation in the microloan program for eligible
intermediaries.
SEC. 102. FEE REDUCTIONS.
(a) Administrative Provisions for the Small Business
Administration.--
(1) Definition.--In this subsection, the term ``covered
business loan'' means a loan--
(A) of not more than $2,000,000;
(B) that is guaranteed by the Administrator under
section 7(a) of the Small Business Act (15 U.S.C.
636(a));
(C) for which the application is approved on or
after the date of enactment of this Act; and
(D) that is made to a Puerto Rico business.
(2) Fees.--During the period beginning on the date of
enactment of this Act and ending on the Oversight Board
termination date, and to the extent that the cost of such
elimination or reduction of fees is offset by appropriations,
with respect to each covered business loan, the Administrator
shall--
(A) in lieu of the fee otherwise applicable under
section 7(a)(23)(A) of the Small Business Act, collect
no fee or reduce fees to the maximum extent possible;
and
(B) in lieu of the fee otherwise applicable under
section 7(a)(18)(A) of the Small Business Act, collect
no fee or reduce fees to the maximum extent possible.
(b) Temporary Fee Elimination for the 504 Loan Program.--
(1) In general.--During the period beginning on the date of
enactment of this Act and ending on the Oversight Board
termination date, and to the extent the cost of such
elimination in fees is offset by appropriations, with respect
to each loan of not more than $2,000,000 guaranteed by the
Administrator under title V of the Small Business Investment
Act of 1958 (15 U.S.C. 695 et seq.) with respect to a
development company that has its principal office located in
Puerto Rico and for which an application is approved or pending
approval on or after the date of enactment of this Act--
(A) the Administrator shall, in lieu of the fee
otherwise applicable under section 503(d)(2) of the
Small Business Investment Act of 1958 (15 U.S.C.
697(d)(2)), collect no fee; and
(B) a development company shall, in lieu of the
processing fee under section 120.971(a)(1) of title 13,
Code of Federal Regulations (relating to fees paid by
borrowers), or any successor thereto, collect no fee.
(2) Reimbursement for waived fees.--
(A) In general.--To the extent that the cost of
such payments is offset by appropriations, the
Administrator shall reimburse each development company
that does not collect a processing fee under paragraph
(1)(B).
(B) Amount.--The reimbursement to a development
company under subparagraph (A) shall be in an amount
equal to 1.5 percent of the net debenture proceeds for
which the development company does not collect a
processing fee under paragraph (1)(B).
(c) Application of Fee Eliminations.--To the extent that amounts
are made available to the Administrator for the purpose of fee
eliminations or reductions under subsection (a), the Administrator
shall--
(1) first use any amounts provided to eliminate or reduce
fees paid by borrowers under clauses (i), (ii), and (iii) of
section 7(a)(18)(A) of the Small Business Act (15 U.S.C.
636(a)(18)(A)), to the maximum extent possible;
(2) to the extent amounts provided remain after use in
accordance with paragraph (1), use any amounts provided to
eliminate or reduce fees under section 7(a)(23)(A) of the Small
Business Act (15 U.S.C. 636(a)(23)(A)) paid by lenders with
assets of not more than $1,000,000,000, as of the date of
enactment of this Act; and
(3) to the extent amounts provided remain after use in
accordance with paragraphs (1) and (2), use any remaining
amounts provided to reduce fees under section 7(a)(23)(A) of
the Small Business Act paid by lenders other than those
described under paragraph (2).
SEC. 103. ECONOMIC STIMULUS LENDING PROGRAM FOR SMALL BUSINESSES.
(a) Authority.--Notwithstanding section 7(a) of the Small Business
Act (15 U.S.C. 636(a)), for a qualifying small business loan the
Administrator may guarantee not more than 90 percent of the balance of
the financing outstanding at the time of disbursement of the loan, if
such balance is less than or equal to $2,000,000.
(b) Qualifying Small Business Loan Defined.--For purposes of this
section, the term ``qualifying small business loan'' means any loan to
a Puerto Rico business made pursuant to section 7(a) of the Small
Business Act (15 U.S.C. 636(a)), except for such loans made under
section 7(a)(31) of such Act (15 U.S.C. 636(a)(31)).
(c) Qualified Borrowers.--
(1) Aliens unlawfully present in the united states.--The
Administrator may not guarantee a loan made under this section
to a small business concern if an individual who is an alien
unlawfully present in the United States--
(A) has an ownership interest in that concern; or
(B) has an ownership interest in another concern
that itself has an ownership interest in that concern.
(2) Firms in violation of immigration laws.--The
Administrator may not guarantee a loan made under this section
to any entity, based on a determination by the Secretary of
Homeland Security or the Attorney General, found to have
engaged in a pattern or practice of hiring, recruiting, or
referring for a fee for employment in the United States an
alien, if such entity knows that the person is an unauthorized
alien.
(d) Criminal Background Checks.--Prior to guaranteeing a loan made
under this section, the Administrator may verify the applicant's
criminal background, or lack thereof, through the best available means,
including, if possible, use of the National Crime Information Center
computer system at the Federal Bureau of Investigation.
(e) Application of Other Law.--Nothing in this section shall be
construed to exempt any activity of the Administrator under this
section from the Federal Credit Reform Act of 1990.
(f) Small Business Act Provisions.--Except as otherwise provided in
this section, the requirements of section 7 of the Small Business Act
(and regulations promulgated thereunder) applicable to loan guarantees
on or before the date of enactment of this Act shall apply to loan
guarantees made under this section.
(g) Sunset.--The Administrator may not guarantee a loan made under
this section after the Oversight Board termination date.
SEC. 104. CONTRIBUTION PERCENTAGES FOR 504 PROJECTS.
Notwithstanding section 502(3) of the Small Business Investment Act
of 1958 (15 U.S.C. 696(3)), during the period beginning on the date of
enactment of this Act and ending on the Oversight Board termination
date, the Administrator may guarantee a debenture issued by a
development company that has its principal office located in Puerto
Rico if, of the total cost of the project financed--
(1) 50 percent is derived from a loan from a private sector
lender;
(2) 45 percent is derived from a loan made from the
proceeds of such debenture issued by the development company;
and
(3) 5 percent is provide by the borrower of such loans.
SEC. 105. INDEPENDENT SUBSIDY CALCULATION.
In making calculations under section 7(a)(26) of the Small Business
Act (15 U.S.C. 636(a)(26)) or section 503(g) of the Small Business
Investment Act of 1958 (15 U.S.C. 697(g)), the Director of the Office
of Management and Budget shall make such calculations separately for
loans purchased or guaranteed under the authority under section 102,
103, or 104 of this Act.
TITLE II--PROCUREMENT
SEC. 201. CONTRACTING PREFERENCE FOR PUERTO RICO BUSINESSES.
Section 15 of the Small Business Act (15 U.S.C. 644) is amended by
adding at the end the following:
``(u) Contracting Preference for Puerto Rico Businesses.--
``(1) Contracting preference.--An agency shall provide a
contracting preference for a Puerto Rico business during the
period beginning on the date of enactment of this subsection
and ending on the date on which the Oversight Board established
under section 101 of the Puerto Rico Oversight, Management, and
Economic Stability Act (48 U.S.C. 2121) terminates. The
preference under this subsection shall take priority over any
preference for purchasing from the procurement list established
pursuant to section 8503 of title 41, United States Code, or
the Federal Prison Industries catalog described under section
4124(d) of title 18, United States Code.
``(2) Credit for meeting contracting goals.--If an agency
awards a contract to a Puerto Rico business as described in
paragraph (1), the value of the contract shall be doubled for
purposes of determining compliance with the goals for
procurement contracts under subsection (g)(1)(A).''.
SEC. 202. PRIORITY FOR SURPLUS PROPERTY TRANSFERS.
Section 7(j)(13)(F) of the Small Business Act (15 U.S.C.
636(j)(13)(F)) is amended by adding at the end the following:
``(iii)(I) In this clause, the term `covered period' means
the period beginning on the date of enactment of this clause
and ending on the date on which the Oversight Board established
under section 101 of the Puerto Rico Oversight, Management, and
Economic Stability Act (48 U.S.C. 2121) terminates.
``(II) The Administrator may transfer technology or surplus
property under clause (i) on a priority basis to a Puerto Rico
business if the Puerto Rico business meets the requirements for
such a transfer, without regard to whether the Puerto Rico
business is a Program Participant.''.
SEC. 203. SUBCONTRACTING INCENTIVES FOR PROTEGE FIRMS THAT ARE PUERTO
RICO BUSINESSES.
Section 45(a) of the Small Business Act (15 U.S.C. 657r(a)) is
amended by adding at the end the following:
``(3) Puerto rico businesses.--
``(A) In general.--During the period beginning on
the date of enactment of this paragraph and ending on
the date on which the Oversight Board established under
section 101 of the Puerto Rico Oversight, Management,
and Economic Stability Act (48 U.S.C. 2121) terminates,
the Administrator shall provide additional incentives
to covered mentors, including providing additional
credit for subcontracts awarded to covered proteges and
costs incurred for providing training to covered
proteges.
``(B) Definitions.--In this paragraph--
``(i) the term `covered mentor' means a
mentor that enters into an agreement under this
Act, or under any mentor-protege program
approved under subsection (b)(1), with a
covered protege; and
``(ii) the term `covered protege' means a
protege--
``(I) of a covered mentor; and
``(II) that has its principal
office located in the Commonwealth of
Puerto Rico.''.
SEC. 204. ADDITIONAL MENTOR-PROTEGE RELATIONSHIPS FOR PROTEGE FIRMS
THAT ARE PUERTO RICO BUSINESSES.
Section 45(b)(3)(A) of the Small Business Act (15 U.S.C.
657r(b)(3)(A)) is amended by inserting ``, except that such
restrictions shall not apply to a relationship that was entered into
before the date on which the Oversight Board established under section
101 of the Puerto Rico Oversight, Management, and Economic Stability
Act (48 U.S.C. 2121) terminates and in which the principal office of
the protege is located in the Commonwealth of Puerto Rico'' after
``each participant''.
TITLE III--ENTREPRENEURIAL DEVELOPMENT
SEC. 301. VETERAN BUSINESS OUTREACH CENTER IN PUERTO RICO.
(a) In General.--Section 32 of the Small Business Act (15 U.S.C.
657b) is amended--
(1) by redesignating subsection (f) as subsection (g); and
(2) by inserting after subsection (e) the following:
``(f) Veteran Business Outreach Center in Puerto Rico.--The
Administrator shall partner with an organization to establish a Veteran
Business Outreach Center in the Commonwealth of Puerto Rico to provide
entrepreneurial development services to small business concerns owned
and controlled by service-disabled veterans and small business concerns
owned and controlled by veterans located in the Commonwealth of Puerto
Rico. If the Administrator cannot partner with an organization, the
Administrator shall use amounts appropriated to carry out this
subsection to provide such services to veterans who own or are
considering starting a Puerto Rico business.''.
(b) Prospective Repeal.--Subsection (a) shall be repealed, and the
provisions of law amended by such subsection shall be restored as if
such subsection had not been enacted, on the Oversight Board
termination date.
SEC. 302. FAST GRANT PROGRAM FOR PUERTO RICO.
(a) In General.--Section 34 of the Small Business Act (15 U.S.C.
657d) is amended by adding at the end the following:
``(j) FAST Grant Program for Puerto Rico.--
``(1) Establishment.--The Administrator shall establish a
program that shall be part of the FAST program to make awards
to, or enter into cooperative agreements with, a Puerto Rico
business.
``(2) Technical assistance.--If no applicant is selected to
receive assistance under this subsection, the Administrator
shall use amounts appropriated to carry out this subsection to
provide business advice and counseling to a Puerto Rico
business.
``(3) Waiver of matching requirements.--The Administrator
may, upon application, waive the matching requirements under
subsection (e)(2) for an applicant that receives an award or
has in effect a cooperative agreement under this subsection.
``(4) Funding.--There is authorized to be appropriated
$100,000 for fiscal year 2017, and each fiscal year thereafter,
to carry out this subsection.''.
(b) Prospective Repeal.--Subsection (a) shall be repealed, and the
provisions of law amended by such subsection shall be restored as if
such subsection had not been enacted, on the Oversight Board
termination date.
TITLE IV--SMALL BUSINESS ADMINISTRATION OVERSIGHT
SEC. 401. REQUIREMENT FOR THE DISTRICT DIRECTOR OF PUERTO RICO.
(a) In General.--During the period beginning on the date of
enactment of this Act and ending on the Oversight Board termination
date, the director of the district office of the Small Business
Administration located in Puerto Rico shall submit directly to Congress
and the Administrator an annual report on the activities of the Small
Business Administration in Puerto Rico.
(b) Coordination.--In preparing each report described in subsection
(a), the director described in such subsection shall consult with other
Federal agencies to collect data on grants, programs, and outreach
activities carried out by such agencies that affect any Puerto Rico
business.
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