To amend the Small Business Act and the Small Business Act of 1958 to establish the National Office for the Development of Small Manufacturers, to increase the level of assistance available for small manufacturers, and for other purposes.

November 18, 2003

Mr. DASCHLE (for Mr. KERRY) introduced the following bill; which was read twice and referred to the Committee on Small Business and Entrepreneurship

To amend the Small Business Act and the Small Business Act of 1958 to establish the National Office for the Development of Small Manufacturers, to increase the level of assistance available for small manufacturers, 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; TABLE OF CONTENTS.

(a) SHORT TITLE- This Act may be cited as the `Manufacturing Assistance, Development, and Education in America Act' or the `MADE in America Act'.

(b) TABLE OF CONTENTS- The table of contents for this Act is as follows:

Sec. 1. Short title; table of contents.

Sec. 2. Definition of small manufacturer.

TITLE I--NATIONAL OFFICE FOR THE DEVELOPMENT OF SMALL MANUFACTURERS

Sec. 101. Establishment of office.

TITLE II--INVESTING IN THE FUTURE OF MANUFACTURING

Sec. 201. Increased access to capital.

Sec. 202. Loans and investments in small manufacturers.

TITLE III--EXPORT ASSISTANCE FOR SMALL MANUFACTURERS

Sec. 301. Small Business Foreign Patent Protection Grant Pilot Program.

SEC. 2. DEFINITION OF SMALL MANUFACTURER.

(a) SMALL BUSINESS ACT- Section 3(j) of the Small Business Act (15 U.S.C. 632(j)) is amended by striking `For the purposes of section 7(b)(2) of this Act, the term' and inserting `As used in this Act--

`(1) the term `small manufacturer' means a small business concern (as defined in subsection (a))--

`(A) whose primary business is classified in sector 31, 32, or 33 of the North American Industrial Classification System; and

`(B) whose production facilities are all located in the United States; and

`(2) the term'.

(b) SMALL BUSINESS INVESTMENT ACT OF 1958- Section 103 of the Small Business Investment Act of 1958 (15 U.S.C. 662) is amended--

(1) in paragraph (16), by striking `and' at the end;

(2) in paragraph (17), by striking the period at the end and inserting `; and'; and

(3) by adding at the end the following:

`(18) the term `small manufacturer' means a small business concern (as defined in section 3(a) of the Small Business Act)--

`(A) whose primary business is classified in sector 31, 32, or 33 of the North American Industrial Classification System; and

`(B) whose production facilities are all located in the United States.'.

TITLE I--NATIONAL OFFICE FOR THE DEVELOPMENT OF SMALL MANUFACTURERS

SEC. 101. ESTABLISHMENT OF OFFICE.

(a) IN GENERAL- The Small Business Act (15 U.S.C. 631 et seq.) is amended--

(1) by redesignating section 36 as section 37; and

(2) by inserting after section 35 the following:

`SEC. 36. NATIONAL OFFICE FOR DEVELOPMENT OF SMALL MANUFACTURERS.

`(a) ESTABLISHMENT- There is established in the Administration the National Office for the Development of Small Manufacturers (referred to in this section as the `Office') to cultivate and develop small manufacturers through a variety of means.

`(b) ASSOCIATE ADMINISTRATOR FOR SMALL MANUFACTURING-

`(1) APPOINTMENT- The Office shall be administered by the Associate Administrator for Small Manufacturing (referred to in this section as the `Associate Administrator'), who shall be appointed under section 4(b)(1).

`(2) RESPONSIBILITIES- In administering the Office, the Associate Administrator, who shall be an appointee in the Senior Executive Service, shall--

`(A) oversee and coordinate the formulation, execution, and promotion of policies and programs of the Administration that provide assistance to small manufacturers, including the creation of the Manufacturing Corps;

`(B) direct Federal agencies and departments to provide information regarding their manufacturing resources and programs, and to take appropriate action to enhance assistance to small manufacturers;

`(C) coordinate the activities, and delivery of such activities, of Federal agencies and departments relating to manufacturing;

`(D) coordinate the activities of Federal agencies with manufacturing activities of the States; and

`(E) consult with and report to the Administrator regarding the fulfillment of responsibilities under this subsection.

`(c) MANUFACTURING CORPS-

`(1) ESTABLISHMENT- The Administrator shall establish a program within the Office to be known as the Manufacturing Corps to focus on the education and training of the existing and potential workforce of small manufacturers.

`(2) ADMINISTRATION- The Manufacturing Corps shall be administered by the Associate Administrator.

`(3) RESPONSIBILITIES- The Manufacturing Corps shall address the pressing need for more skilled workers by promoting vocational, technical, and academic education relating to the manufacturing sector.

`(4) CURRICULUM DEVELOPMENT-

`(A) OUTREACH- The Associate Administrator shall regularly seek input from small manufacturers regarding the human capital needs of the manufacturing industry.

`(B) COOPERATION- The input received under subparagraph (A) shall be used to develop, and annually update, a detailed manufacturing training curriculum for each State through the cooperative effort of small manufacturers and educational institutions.

`(d) MANUFACTURING TRAINING BLOCK GRANTS-

`(1) GRANTS AUTHORIZED- The Administrator, in consultation with the Associate Administrator, shall award block grants to States, which shall allocate grant funds to individuals and eligible entities to develop and implement manufacturing training programs.

`(2) FUNDING FORMULA-

`(A) IN GENERAL- Subject to subparagraph (C), the amount of a formula grant received by a State under this subsection shall be equal to an amount determined in accordance with the following formula:

`(i) The annual amount made available under subsection (i) for the Manufacturer Corps Program shall be divided on a pro rata basis, based on the percentage of the population of each State, as compared to the population of the United States.

`(ii) If the pro rata amount calculated under clause (i) for any State is less than the minimum funding level under subparagraph (C), the Administration shall determine the aggregate amount necessary to achieve that minimum funding level for each such State.

`(iii) The aggregate amount calculated under clause (ii) shall be deducted from the amount calculated under clause (i) for States eligible to receive more than the minimum funding level. The deductions 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 clause (iii) shall be added to the grants of those States that are not eligible to receive more than the minimum funding level in order to achieve the minimum funding level for each such State, except that the eligible amount of a grant to any State shall not be reduced to an amount below the minimum funding level.

`(B) GRANT DETERMINATION- The amount of a grant that a State is eligible to apply for under this subsection shall be the amount determined under subparagraph (A), subject to any modifications required under subparagraph (C), and shall be based on the amount available for the fiscal year in which performance of the grant commences, but not including amounts distributed in accordance with subparagraph (D). 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 Government, as required under paragraph (7).

`(C) MINIMUM FUNDING LEVEL- Each State shall receive a block grant under this subsection in an amount not less than--

`(i) $200,000 for any fiscal year in which the total amount appropriated for grants under this subsection is not more than $25,000,000;

`(ii) $300,000 for any fiscal year in which the total amount appropriated for grants under this subsection is more than $25,000,000, but not more than $50,000,000;

`(iii) $400,000 for any fiscal year in which the total amount appropriated for grants under this subsection is more than $50,000,000, but not more than $75,000,000; and

`(iv) $500,000 for any fiscal year in which the total amount appropriated for grants under this subsection is more than $75,000,000.

`(D) DISTRIBUTIONS- Subject to subparagraph (C), if any State does not apply for, or use, its full funding eligibility for a fiscal year, the Administration shall distribute the remaining funds as supplemental grants to any State, as the Administration determines, in its discretion, to be appropriate.

`(3) ELIGIBLE ENTITIES- Secondary, vocational, and postsecondary schools that receive public funding, manufacturing extension partnerships, small business development centers, women's business centers, and similar nonprofit organizations shall be eligible to receive grant funds from States under this subsection.

`(4) USE OF FUNDS-

`(A) IN GENERAL- Grants awarded under this section may only be used to develop and implement vocational, technical, or academic training programs to educate and enhance the skills of--

`(i) individuals working in the field of manufacturing; and

`(ii) students who are interested in working in the field of manufacturing.

`(B) SECONDARY SCHOOLS- Secondary schools may use funds received under this subsection to develop and conduct vocational and technology training to high school students to prepare students who are not planning to attend college immediately after graduation for employment in the field of manufacturing. Schools are encouraged to partner with small

manufacturers to address their skilled worker needs and to provide employment opportunities for students after graduation.

`(C) CONTINUING EDUCATION- Manufacturing extension partnerships, small business development centers, women's business centers, and similar nonprofit organizations may use funds received under this subsection to assist existing manufacturing workers to improve their skills and advance their technical abilities.

`(5) STUDENT LOAN REPAYMENT PROGRAM-

`(A) IN GENERAL- States may use grant funds received under this subsection to encourage recent college graduates to work for a small manufacturer by repaying a portion of their student loans during the period of such employment.

`(B) MAXIMUM AMOUNTS- A State may make payments of not more than $300 per month toward the student loan principal and interest of any college graduate who has committed to work for a small manufacturer for a 4-year period beginning not sooner than the date on which the graduate submits an application under paragraph (6)(B). Aggregate payments to any individual under this paragraph may not exceed $25,000.

`(C) RENEWAL- After the initial 4-year term established under subparagraph (B) has been completed, the State may annually renew its commitment under subparagraph (B) for successive 1-year periods if the college graduate commits to continue working for the small manufacturer.

`(D) MAXIMUM COMPENSATION- Individuals whose gross annual compensation (including bonuses) from the small manufacturer is greater than $60,000 are ineligible to participate in the student loan repayment program authorized by this paragraph.

`(6) APPLICATION-

`(A) INSTITUTIONAL APPLICANTS- Any eligible entity desiring funding under this subsection shall submit a proposal to the appropriate representative of the State in which it is located.

`(B) INDIVIDUAL APPLICANTS- Any college graduate desiring to participate in the student loan repayment program authorized under paragraph (5) shall submit an application to the appropriate representative of the State in which the graduate resides in such form as such representative may reasonably require.

`(C) CRITERIA- States may determine which applicants receive funding under this subsection based upon specific needs and available resources.

`(7) MATCHING REQUIREMENT-

`(A) YEARS 1 AND 2- During each of the first and second years of the grant program established under this subsection, each State receiving a block grant under this subsection shall provide $1 in non-Federal funding for each $3 received in Federal funding under this section.

`(B) YEARS 3 AND 4- During each of the third and fourth years of the grant program established under this subsection, each State receiving a block grant under this subsection shall provide $1 in non-Federal funding for each $2 received in Federal funding under this section.

`(C) YEARS 5 THROUGH 10- During each of the fifth through tenth years of the grant program established under this subsection, each State receiving a block grant under this subsection shall provide $1 in non-Federal funding for each $1 received in Federal funding under this section.

`(8) STATE REPORTING REQUIREMENT- Each State receiving a grant under this subsection shall provide sufficient information to the Administration about the distribution of grant funds to complete the report required under subsection (e).

`(9) DEFINED TERM- As used in this subsection, the term `State' has the meaning given the term in section 34(a).

`(e) BUSINESSLINC MANUFACTURING-

`(1) IN GENERAL- In accordance with this subsection, the Administrator may make grants to and enter into cooperative agreements with any coalition of private entities, public entities, or any combination of private and public entities--

`(A) to expand business-to-business relationships between large and small manufacturers; and

`(B) to provide large and small manufacturers, directly or indirectly, with online information and a database of companies that are interested in mentor-protege programs or community-based, statewide, or local business development programs.

`(2) MATCHING REQUIREMENT- Subject to subparagraph (B), the Administrator may make a grant to a coalition under paragraph (1) only if the coalition provides for activities described in paragraph (1)(A) or (1)(B) an amount, either in kind or in cash, equal to the grant amount.

`(3) AUTHORIZATION OF APPROPRIATIONS- There are authorized to be appropriated to carry out this subsection $2,000,000 for each of the fiscal years 2004 through 2008, which shall remain available until expended.

`(f) WEBSITE FOR SMALL MANUFACTURERS- The Associate Administrator shall establish a website that contains information for small manufacturers regarding--

`(1) entrepreneurial development assistance;

`(2) access to capital;

`(3) specific outreach programs;

`(4) contracting opportunities; and

`(5) research and development projects.

`(g) MENTOR-PROTEGE PROGRAM- The Associate Administrator shall establish a mentor-protege program that pairs small manufacturers with larger, more experienced manufacturers to provide guidance regarding--

`(1) management practices;

`(2) domestic and foreign marketing;

`(3) efficiency improvements; and

`(4) product development.

`(h) REPORT-

`(1) IN GENERAL- The Administrator, in consultation with the Associate Administrator, shall submit an annual report on the implementation of this section to the Committee on Small Business and Entrepreneurship of the Senate and the Committee on Small Business of the House of Representatives.

`(2) CONTENTS- Each report submitted under paragraph (1) shall include, for the reporting period--

`(A) the number of persons assisted under this section, categorized by type of assistance received;

`(B) the number of persons described under subparagraph (A) who had previously received assistance under this section;

`(C) the number of persons described in subparagraph (A) who are working in the manufacturing sector;

`(D) the number and amount of grants awarded under this section, categorized by type of recipient;

`(E) the number of small manufacturers receiving grant funds under this section; and

`(F) the net increase in manufacturing jobs available at the small manufacturers described in subparagraph (E).

`(i) AUTHORIZATION OF APPROPRIATIONS- There are authorized to be appropriated $275,000,000 for each of the fiscal years 2005 through 2014 to carry out subsections (c) and (d).'.

(b) CONFORMING AMENDMENTS- Section 4(b)(1) of the Small Business Act (15 U.S.C. 633(b)(1)) is amended--

(1) by striking `five Associate Administrators' and inserting `6 Associate Administrators'; and

(2) by adding at the end the following: `One of the Associate Administrators shall be the Associate Administrator for Small Manufacturing, who shall administer the National Office for the Development of Small Manufacturers established under section 36.'.

TITLE II--INVESTING IN THE FUTURE OF MANUFACTURING

SEC. 201. INCREASED ACCESS TO CAPITAL.

(a) WORKING CAPITAL LOANS- Section 7(a) of the Small Business Act (15 U.S.C. 636(a)) is amended--

(1) in paragraph (3)--

(A) by inserting `TOTAL AMOUNT OF LOANS- ' before `No loan';

(B) by amending subparagraph (A) to read as follows:

`(A) if the total amount outstanding and committed (by participation or otherwise) to the borrower under section 7(a) would exceed $1,000,000 (or if the gross loan amount would exceed $2,000,000), except as provided in subparagraphs (B) and (D) and paragraph (14), plus an amount not to exceed the maximum amount of a development company financing under title V of the Small Business Investment Act of 1958 (15 U.S.C. 695 et seq.), and the Administration shall report to Congress in its annual budget request and performance plan on the number of small business concerns that have financings under this subsection and under title V of the Small Business Investment Act of 1958, and the total amount and general performance of such financings;';

(C) in subparagraph (B)--

(i) by striking `$1,250,000' and inserting `$1,300,000'; and

(ii) by striking `and' at the end;

(D) in subparagraph (C), by striking the period at the end and inserting `; and'; and

(E) by adding at the end the following:

`(D) to a small manufacturer if the total amount outstanding and committed to the borrower from the business loan and investment fund established by this Act would exceed $2,000,000 (or if the gross loan amount would exceed $4,000,000).'; and

(2) in paragraph (14), by adding at the end the following:

`(D) The total amount of financings under this paragraph that are outstanding and committed (by participation or otherwise) to the borrower from the business loan and investment fund established under this Act may not exceed $1,300,000 and the gross loan amount under this paragraph may not exceed $2,600,000.'.

(b) DISASTER LOANS- Section 7(b)(3) of the Small Business Act (15 U.S.C. 636(b)) is amended by inserting after subparagraph (F) the following:

`(G) LIMITATION ON SALES OF LOANS- The Administration may not sell a loan under this subsection as part of an asset sale.

`(H) SMALL MANUFACTURERS-

`(i) MAXIMUM LOAN AMOUNT- Notwithstanding subparagraph (E), the Administration may make a disaster loan to a small manufacturer under this paragraph, either directly or in cooperation with banks or other lending institutions through agreements to participate on an immediate or deferred basis, in an amount greater than $1,500,000, if the total amount outstanding and committed to the borrower does not exceed $5,000,000.

`(ii) REFINANCING DISASTER LOANS- Any loan made to a small manufacturer under this subparagraph that was outstanding on the date of the disaster may be refinanced by a small manufacturer that is also eligible to receive a loan under this subsection. The refinanced amount shall be considered to be part of the new loan for purposes of this subsection and shall be in addition to any other loan eligibility for that small manufacturer under this Act and the Small Business Investment Act of 1958. With respect to a refinancing under this clause, payments of principal shall be deferred,

and interest shall not accrue during the 6-month period following the date of refinancing.

`(iii) REFINANCING BUSINESS DEBT-

`(I) IN GENERAL- Any business debt of a small manufacturer that was outstanding on the date of the disaster may be refinanced by the small manufacturer if it is also eligible to receive a loan under this subsection. With respect to a refinancing under this clause, payments of principal shall be deferred, and interest shall not accrue during the 6-month period following the date of refinancing.

`(II) RESUMPTION OF PAYMENTS- At the end of the 6-month period described in subclause (I), the payment of periodic installments of principal and interest shall be required with respect to such loan, in the same manner and subject to the same terms and conditions as would otherwise be applicable to any other loan made under this subsection.

`(iv) AUTHORITY TO INCREASE OR WAIVE SIZE STANDARDS AND SIZE REGULATIONS-

`(I) IN GENERAL- At the discretion of the Administrator, the Administrator may increase or waive otherwise applicable size standards or size regulations with respect to businesses applying for disaster loans under this subparagraph.

`(II) EXEMPTION FROM ADMINISTRATIVE PROCEDURES- The provisions of subchapter II of chapter 5, of title 5, United States Code, shall not apply to any increase or waiver by the Administrator under subclause (I).'.

(c) MICROLOANS- Section 7(m) of the Small Business Act (15 U.S.C. 636(m)) is amended--

(1) in paragraph (1)--

(A) in subparagraph (A)--

(i) in clause (iii), by striking `and' at the end;

(ii) in clause (iv), by striking the period at the end and inserting `; and'; and

(iii) by adding at the end the following:

`(v) to assist small manufacturers.'; and

(B) in subparagraph (B)(iii), by inserting `(or $50,000 if the borrower is a small manufacturer)' after `$35,000'; and

(2) in paragraph (3)(E)--

(A) by striking `In no case shall an intermediary' and inserting `An intermediary may not'; and

(B) by inserting before the period at the end the following: `, unless the borrower is a small manufacturer. An intermediary may not make a loan to a small manufacturer under this section of more than $50,000, or have outstanding or committed to any small manufacturer more than $50,000'.

SEC. 202. LOANS AND INVESTMENTS IN SMALL MANUFACTURERS.

(a) MANUFACTURING LOANS-

(1) JOB CREATION OR RETENTION STANDARDS- Section 501 of the Small Business Investment Act of 1958 (15 U.S.C. 695) is amended--

(A) in subsection (d)(2), by inserting `increasing the productive capacity of small manufacturers,' after `area'; and

(B) by striking the undesignated paragraph at the end and inserting the following:

`(e) JOB CREATION OR RETENTION- A project being funded by the debenture is deemed to satisfy the job creation or retention requirement under subsection (d)(1) if the project creates or retains--

`(1) 1 job opportunity for every $50,000 guaranteed by the Administration; or

`(2) in the case of a manufacturing project, 1 job opportunity for every $100,000 guaranteed by the Administration.'.

(2) MAXIMUM AMOUNT- Section 502(2) of the Small Business Investment Act of 1958 (15 U.S.C. 696(2)) is amended to read as follows:

`(2) MAXIMUM AMOUNT- Loans made by the Administration under this section shall be limited to--

`(A) $1,000,000 for each small business concern if the loan proceeds will not be directed toward a goal or project described in subparagraph (B) or (C);

`(B) $1,300,000 for each small business concern if the loan proceeds will be directed toward 1 or more of the public policy goals described under section 501(d)(3); and

`(C) $4,000,000 for each small business concern if the loan proceeds will be directed toward manufacturing projects.'.

(3) RULE OF CONSTRUCTION- Section 502 of the Small Business Investment Act of 1958 (15 U.S.C. 696) is amended by adding at the end the following:

`(7) RULE OF CONSTRUCTION- A loan under this section shall not be construed to be limited by any loan guaranteed by the Administration under subsection (a) or (b) of section 7 of the Small Business Act (15 U.S.C. 636(a) and (b)).'.

(b) SMALL BUSINESS INVESTMENT COMPANIES- Section 303(b)(4) of the Small Business Investment Act of 1958 (15 U.S.C. 683(b)(4)) is amended--

(1) in subparagraph (A), by striking `(as determined by the Administrator)' and all that follows and inserting `may not exceed $115,000,000.'; and

(2) by amending subparagraph (B) to read as follows:

`(B) EXCEPTIONS-

`(i) MAJORITY OF FINANCINGS IN SMALL MANUFACTURERS- If the licensee certifies in writing that not less than 50 percent of the aggregate dollar amount of

its financings are to small manufacturers--

`(I) the maximum amount of outstanding leverage issued to any 1 company shall be $150,000,000; and

`(II) the maximum amount of outstanding leverage issued to companies that are under common control shall be $185,000,000.

`(ii) COMPANIES UNDER COMMON CONTROL- The Administrator may, on a case-by-case basis--

`(I) approve an amount of leverage that exceeds the amount described in clause (i) and subparagraph (A) for companies under common control; and

`(II) impose such additional terms and conditions as the Administrator determines to be appropriate to minimize the risk of loss to the Administration in the event of default.'.

(c) NEW MARKET VENTURE CAPITAL PROGRAM-

(1) PURPOSES- Section 352 of the Small Business Investment Act (15 U.S.C. 689a) is amended--

(A) in paragraph (1), by inserting `and small manufacturers' after `enterprises'; and

(B) in paragraph (2), by inserting `and small manufacturers' after `enterprises'.

(2) MAXIMUM GUARANTEE FOR SMALL MANUFACTURERS- Section 355(d)(1) of the Small Business Investment Act (15 U.S.C. 689d(d)(1)) is amended--

(A) by striking `does not exceed 150 percent' and inserting `does not exceed--

`(A) 150 percent'; and

(B) by striking the period at the end and inserting `; and

`(B) 200 percent of the private capital of the company, if the New Markets Venture Capital company certifies in writing that not less than 50 percent of its investments are in small manufacturers.'.

(d) AUTHORIZATION OF ADDITIONAL APPROPRIATIONS- Section 368 of the Small Business Investment Act of 1958 (15 U.S.C. 689q) is amended--

(1) by redesignating subsection (b) as subsection (c); and

(2) by inserting after subsection (a) the following:

`(b) AUTHORIZATION OF ADDITIONAL APPROPRIATIONS- In addition to the authorizations under subsection (a), there are authorized to be appropriated for each of fiscal years 2005 and 2006, to remain available until expended, the following sums:

`(1) Such subsidy budget authority as may be necessary to guarantee $75,000,000 of debentures under this part.

`(2) $15,000,000 to make grants under this part.'.

TITLE III--EXPORT ASSISTANCE FOR SMALL MANUFACTURERS

SEC. 301. SMALL BUSINESS FOREIGN PATENT PROTECTION GRANT PILOT PROGRAM.

Section 9 of the Small Business Act (15 U.S.C. 638) is amended by adding at the end the following:

`(x) SMALL BUSINESS FOREIGN PATENT PROTECTION GRANT PILOT PROGRAM-

`(1) GRANTS AUTHORIZED- The Administrator shall make grants from the Fund established under paragraph (5) for the purpose of assisting small business concerns in seeking foreign patent protection in accordance with this subsection.

`(2) NUMBER AND AMOUNT OF GRANTS-

`(A) MAXIMUM AMOUNT- The amount of a grant made to any small business concern under this subsection may not exceed $25,000, and no awardee may receive more than 1 grant under this subsection.

`(B) RESERVED AMOUNTS-

`(i) IN GENERAL- Not less than 1/2 of all amounts awarded under this section shall be reserved for recipients of awards under the Small Business Innovation Research Program or the Small Business Technology Transfer Program.

`(ii) EXCEPTION- Any amount reserved for grants under clause (i) for any fiscal year that has not been obligated by July 1st of such fiscal year, may be used for grants under this subsection to any small business concern.

`(3) GRANT PURPOSES- Grant amounts awarded under this subsection shall be used by grantees to underwrite costs associated with initial foreign patent applications for technologies or products developed by small business concerns, and for which an application for United States patent protection has already been filed.

`(4) CONSIDERATIONS- In awarding grants under this subsection, the Director of the Office of Technology shall consider--

`(A) the size and financial need of the applicant;

`(B) the potential foreign market for the technology;

`(C) the timeframes for filing foreign patent applications; and

`(D) such other factors as the Administrator deems relevant.

`(5) ESTABLISHMENT OF REVOLVING FUND- There is established in the Treasury of the United States a revolving fund, which shall be--

`(A) known as the `Small Business Foreign Patent Protection Grant Fund' (referred to in this subsection as the `Fund');

`(B) administered by the Office of Technology of the Administration, in consultation with the National Office for Development of Small Manufacturers; and

`(C) used solely to fund grants under this subsection and to pay the costs to the Administration of administering those grants.

`(6) ROYALTY FEES-

`(A) IN GENERAL- Each recipient of a grant under this subsection shall pay a fee to the Administration, to be deposited into the Fund, based on the export sales receipts or licensing fees, if any, from the product or technology that is the subject of the foreign patent petition.

`(B) ANNUAL INSTALLMENTS BASED ON RECEIPTS- The fee required under subparagraph (A)--

`(i) shall be paid to the Administration in annual installments, based on the export sales receipts or licensing fees described in subparagraph (A) that are collected by the grant recipient in that calendar year;

`(ii) shall not be required to be paid in any calendar year in which no export sales receipts or licensing fees described in subparagraph (A) are collected by the grant recipient; and

`(iii) shall not exceed, in total, the lesser of--

`(I) 5 percent of the total export sales receipts and licensing fees referred to in subparagraph (A); or

`(II) 4 times the amount of the grant received.

`(7) ADMINISTRATIVE PROVISIONS- Not later than 180 days after the date of enactment of this subsection, the Administrator shall--

`(A) issue such regulations as are necessary to carry out this subsection; and

`(B) establish appropriate application and other administrative procedures, as the Administrator deems necessary.

`(8) REPORT- The Administrator shall, not later than January 31, 2008, submit a report to Congress on the grants authorized by this subsection, which report shall include, categorized by year and total--

`(A) the number of grant recipients under this subsection since the date of enactment of this subsection;

`(B) the number and amount of sales or licensing fees of such grant recipients that have made foreign sales (or granted licenses to make foreign sales) and a brief description of each technology or product;

`(C) the number of technologies or products developed under the Small Business Innovation Research Program or the Small Business Technology Transfer Program, and the amounts of such sales (or licenses);

`(D) the total amount of fees paid into the Fund by recipients of grants under this subsection in accordance with paragraph (6);

`(E) recommendations for any adjustment in the percentages specified in paragraph (6)(B)(iii)(I) or the amount specified in paragraph (6)(B)(iii)(II) necessary to reduce to zero the cost to the Administration of making grants under this subsection;

`(F) any recommendations regarding the grant amount; and

`(G) any recommendations of the Administrator regarding improvements to the programs, whether authorization for grants under this subsection should be extended, and any necessary legislation related to such an extension.

`(9) STAFFING- The Administrator shall ensure that there are sufficient staff in the Office of Technology, including not fewer than 2 full-time employees, to carry out the grant program established under this subsection.

`(10) AUTHORIZATION OF APPROPRIATIONS- There are authorized to be appropriated to the Fund, to remain available until expended--

`(A) $2,500,000 for fiscal year 2005;

`(B) $5,000,000 for fiscal year 2006;

`(C) $7,500,000 for fiscal year 2007; and

`(D) $10,000,000 for each of fiscal years 2008 and 2009.'.

END