"(b) No further insurance shall be granted under this title with respect to any borrower if the total outstanding amount of all loans of such borrower insured under this title would thereby exceed $250,000, or with respect to any loan whose maturity is in excess of five years and thirty-two days.

"(c) No insurance shall be granted under this title for any loan for agricultural purposes, as determined in accordance with regulations issued by the Administrator after consultation with the Secretary of Agriculture, or with respect to any loan which is eligible to be insured under the National Housing Act, as amended.

"(d) Any loan with respect to which insurance is granted under this title may be refinanced or extended with continued protection under this title in accordance with such regulations as the Administrator may prescribe: Provided, That the amount or unexpired term of any such loan shall not be in excess of the limitations contained in paragraph (b) of this section.

"TRANSFER OF INSURANCE BETWEEN INSTITUTIONS

"SEC. 206. The Administrator, under such regulations as he may prescribe, may permit the transfer to any approved lender any insurance in connection with loans which such lender wishes to purchase from another approved lender.

"REVOLVING FUND

"SEC. 207. (a) The premiums and other moneys received by the Administrator in the course of operations under this title shall be deposited in a revolving fund in the Treasury of the United States. The revolving fund shall be available for defraying the operating expenses incurred under this title, and for the payment of claims in connection with the insurance granted under this title.

"(b) For the purposes of carrying out the provisions of this title, there are hereby authorized to be appropriated to the revolving fund provided in this section

"(1) the sum of $10,000,000 for the initial establishment of the revolving fund; and

"(2) such further sums, if any, as may become necessary for the adequacy of the revolving fund.

"(c) The Administrator shall pay annually into the Treasury, as miscellaneous receipts, interest on any sums appropriated to the revolving fund which have not been repaid into the Treasury as provided in subsection (d). The Secretary of the Treasury shall determine the interest rate annually in advance, such rate to be calculated to reimburse the Treasury for its costs in connection with such appropriated funds, taking into consideration the current average interest rate which the Treasury pays upon its marketable obligations. "(d) At least annually any balance in the revolving fund in excess of an amount determined by the Administrator to be necessary for requirements of the fund, and for reasonable reserves to maintain the solvency of the fund, shall be paid into the Treasury as miscellaneous receipts, and any outstanding balance in the amounts appropriated to the revolving fund shall be reduced by the same amount.

"(e) The Administrator, with the approval of the Secretary of the Treasury, may invest and reinvest such portions of the revolving fund as he may determine to be in excess of current needs in any interest-bearing securities of the United States or in any securities guaranteed as to principal and interest by the United States, and the income therefrom shall constitute a part of the revolving fund.

"(f) The financial transactions, accounts, books and records of the Administrator pertaining to the revolving fund shall be audited on an annual basis by the General Accounting Office and a copy of each report on the audit shall be furnished to the President, the Congress, and the Administrator.

"EXEMPTION FROM SECTION 24 OF THE FEDERAL RESERVE ACT

"SEC. 208. Loans made by national banks with respect to which insurance is granted under this title shall be exempt from the provisions of section 24 of the Federal Reserve Act (12 U. S. C. 371) relating to real estate loans.

"AUTHORITY TO PROMULGATE AND WAIVE REGULATIONS

"SEC. 209. (a) The Administrator may make such rules and regulations as he deems necessary to carry out the authority vested in him by or pursuant to this Act. Any such rule or regulation issued under this Act may contain such classifications and differentiations and may provide for such adjustments and reasonable exceptions as in the judgment of the Administrator are necessary or proper in order to effectuate the purposes of this Act.

"(b) The Administrator is authorized to waive compliance with any such rules and regulations, if, in his judgment, they have been substantially complied with in good faith and where in his opinion such waiver would not be in derogation of the interest of the Government.

"PENALTIES

"SEC. 210. (a) Title 18, United States Code, section 493, is amended by inserting the phrase 'Small Business Administration,' after the phrase 'Federal Housing Administration,'.

"(b) Title 18, United States Code, section 657, is amended by inserting the phrase 'Small Business Administration,' after the phrase 'Federal Housing Administration,'.

"(c) Title 18, United States Code, section 1006, is amended by inserting the phrase 'Small Business Administration,' after the phrase 'Federal Housing Administration,'.

"(d) Title 18, United States Code, section 1010, is amended by inserting the phrase 'or Small Business Administration,' after the phrase 'Federal Housing Administration,'.

"(e) Title 18, United States Code, section 1014, is amended by inserting the phrase "The Small Business Administration,' after the words 'National farm loan association'.

"TITLE III-GENERAL PROVISIONS

"SEC. 301. (a) All moneys of the Administration not otherwise employed may be deposited with the Treasurer of the United States subject to check by authority of the Administration. The Federal Reserve banks are authorized and directed to act as depositaries, custodians, and fiscal agents for the Administration in the general performance of its powers conferred by this Act. Any banks insured by the Federal Deposit Insurance Corporation, when designated by the Secretary of the Treasury, shall act as custodians and financial agents for the Administration. Each Federal Reserve bank, when designated by the Administrator as fiscal agent for the Administration, shall be entitled to be reimbursed for all expenses incurred as such fiscal agent.

"(b) The Administrator shall contribute to the civil-service retirement and diability fund on the basis of annual billings as determined by the Civil Service Commission, for the Government's share of the cost of the civil service retirement system applicable to the employees engaged in carrying out the functions of this Act. The Administrator shall also contribute to the employees' compensation fund, on the basis of annual billings as determined by the Secretary of Labor, for the benefit payments made from such funds on account of employees engaged in carrying out the functions financed by such revolving fund. The annual billings shall also include a statement of the fair portion of the cost of the administration of the respective funds, which shall be paid by the Administrator into the Treasury as miscellaneous receipts.

"SEC. 302. The President may transfer to the Administration any functions, powers, and duties of any department or agency which relate primarily to smallbusiness problems. In connection with any such transfer, the President may provide for appropriate transfers of records, property, necessary personnel, and unexpended balances of appropriations and other funds available to the department or agency from which the transfer is made.

"SEC. 303. To the fullest extent the Administration deems practicable, it shall make a fair charge for the use of Government-owned property and make and let contracts on a basis that will result in a recovery of the direct costs incurred by the Administration.

"SEC. 304. (a) Whoever makes any statement knowing it to be false, or whoever willfully overvalues any security, for the purpose of obtaining for himself or for any applicant any loan, or extension thereof by renewal, referment of action, or otherwise, or the acceptance, release, or substitution of security there

for, or for the purpose of influencing in any way the action of the Administration, or for the purpose of obtaining money, property, or anything of value, under this Act, shall be punished by a fine of not more than $5,000 or by imprisonment for not more than two years, or both.

"(b) Whoever, being connected in any capacity with the Administration, (A) embezzles, abstracts, purloins, or willfully misapplies any moneys, funds, securities, or other things of value, whether belonging to it or pledged or otherwise entrusted to it, or (B) with intent to defraud the Administration or any other body politic or corporate, or any individual, or to deceive any officer, auditor, or examiner of the Administration, makes any false entry in any book, report, or statement of or to the Administration, or, without being duly authorized, draws any order or issues, puts forth, or assigns any note, debenture, bond, or other obligation, or draft, bill of exchange, mortgage, judgment, or decree thereof, or (C) with intent to defraud participates, shares, receives directly or indirectly any money, profit, property, or benefit through any transaction, loan, commission, contract, or any other act of the Administration, or (D) gives any unauthorized information concerning any future action or plan of the Administration which might affect the value of securities, or, having such knowledge, invests or speculates, directly or indirectly, in the securities or property of any company or corporation receiving loans or other assistance from the Administration, shall be punished by a fine of not more than $10,000 or by imprisonment for not more than five years, or both.

"SEC. 305. If any provision of this Act, or the application thereof to any person or circumstances, is held invalid, the remainder of this Act, and the application of such provision to other persons or circumstances, shall not be affected thereby.

"SEC. 306. The termination of this Act shall not affect the disbursement of funds under, or the carrying out of, any contract, commitment, or other obligations entered into pursuant to this Act prior to the date of such termination, or the taking of any action necessary to preserve or protect the interests of the United States.

"SEC. 307. There are hereby authorized to be appropriated such sums as may be necessary and appropriate for the carrying out of the provisions and purposes of this Act.

"SEC. 308. All laws and parts of laws inconsistent with this Act are hereby repealed to the extent of such inconsistency.

"SEC. 309. This Act shall take effect July 1, 1957."

[S. 1789, 85th Cong., 1st sess.]

A BILL To amend the Small Business Act of 1953 (title II of Public Law 163, Eighty-third Congress), as amended

Be it enacted by the Senate and House of Representatives of the United States of America in Congress assembled, That the Small Business Act of 1953, as amended, is hereby amended to read as follows:

"SEC. 201. This title may be cited as the 'Small Business Act of 1953'.

"SEC. 202. (a) The essence of the American economic system of private enterprise is free competition. Only through full and free competition can free markets, free entry into business and opportunities for the expression and growth of personal initiative and individual judgment be assured. The preservation and expansion of such competition is basic not only to the economic well-being but to the security of this Nation. Such security and well-being cannot be realized unless the actual and potential capacity of small business is encouraged and developed. It is the declared policy of the Congress that the Government should aid, counsel, assist, and protect insofar as is possible the interests of small-business concerns in order to preserve free competitive enterprise, to insure that a fair proportion of the total purchases and contracts for property and services for the Government (including, but not limited to contracts for maintenance, repair, and construction) be placed with small-business enterprises, and to maintain and strengthen the overall economy of the Nation.

"(b) Further, it is the declared policy of the Congress that the Government should aid and assist victims of flood and other catastrophes.

"SEC. 203. For the purposes of this title, a small-business concern shall be deemed to be one which is independently owned and operated and which is not dominant in its field of operation. In addition to the foregoing criteria the

Administration, in making a detailed definition, may use these criteria, among others: Number of employees and dollar volume of business.

"SEC. 204. (a) In order to carry out the policies of this title there is hereby created an agency under the name 'Small Business Administration' (herein referred to as the Administration), which Administration shall be under the general direction and supervision of the President and shall not be affiliated with or be within any other agency or department of the Federal Government. The principal office of the Administration shall be located in the District of Columbia, but the Administration may establish such branch and regional offices in other places in the United States as may be determined by the Administrator of the Administration. As used in this Act, the term 'United States' includes the several States, the Territories, and possessions of the United States, the Commonwealth. of Puerto Rico, and the District of Columbia.

"(b) The management of the Administration shall be vested in an Adminis-trator who shall be appointed from civilian life by the President, by and with the advice and consent of the Senate, and who shall be a person of outstanding qualifications known to be familiar and sympathetic with small-business needs and problems. The Administrator shall not engage in any other business, vocation, or employment than that of serving as Administrator. The Administrator is authorized to appoint three deputy administrators to assist in the execution of the functions vested in the Administration. The Administrator and the deputy administrators shall receive compensation at the rates provided in the Federal Executive Pay Act of 1956, or any amendments thereof.

"(c) There is hereby created the Loan Policy Board of the Small Business Administration, which shall consist of the following members, all ex officio: The Administrator, as Chairman, the Secretary of the Treasury, and the Secretary of Commerce. Either of the said Secretaries may designate an officer of his Department, who has been appointed by the President by and with the adviceand consent of the Senate, to act in his stead as a member of the Loan Policy Board with respect to any matter or matters. The Loan Policy Board shall establish general policies (particularly with reference to the public interest involved. in the granting and denial of applications for financial assistance by the Administration and with reference to the coordination of the functions of the Admiistration with other activities and policies of the Government) which shall govern the granting and denial of applications for financial assistance by the Administration.

"SEC. 205. (a) The Administration shall have power to adopt, alter, and use. a seal, which shall be judicially noticed. The Administrator is authorized, subject to the civil-service and classification laws, to select, employ, appoint, and. fix the compensation of such officers, employees, attorneys, and agents as shall be necessary to carry out the provisions of this title; to define their authority and duties; to provide bonds for them in such amounts as the Administrator shall determine; and to pay the costs of qualification of certain of them as notaries public. The Administration, with the consent of any board, commission, independent establishment, or executive department of the Government, may avail itself on a reimbursable or nonreimbursable basis of the use of information, services, facilities, including any field service thereof, officers, employees thereof,. in carrying out the provisions of this title. Subject to the standards and procedures under section 505 of the Classification Act of 1949, as amended, not to exceed fifteen positions in the Small Business Administration may be placed in. grades 16, 17, and 18 of the General Schedule estabilshed by that Act, and any such positions shall be additional to the number authorized by such section. "(b) In the performance of, and with respect to, the functions, powers, and duties vested in him by this title, the Administrator may

"(1) sue and be sued in any court of record of a State having general jurisdiction, or in any United States district court, and jurisdiction is con-ferred upon such district court to determine such controversies without regard to the amount in controversy: Provided, That no attachment, injunction, garnishment, or other similar process, mesne or final, shall be issued against the Administrator or his property;

"(2) under regulations prescribed by him, assign or sell at public or private sale, or otherwise dispose of for cash or credit, in his discretion and upon such terms and conditions and for such consideration as the Administrator shall determine to be reasonable, any evidence of debt, contract, claim, personal property, or security assigned to or held by him in connection with the payment of loans granted under this title, and to collect or compromise all obligations assigned to or held by him and all legal or

equitable rights accruing to him in connection with the payment of such loans until such time as such obligations may be referred to the Attorney General for suit or collection;

"(3) deal with, complete, renovate, improve, modernize, insure, or rent, or sell for cash or credit upon such terms and conditions and for such consideration as the Administrator shall determine to be reasonable, any real property conveyed to or otherwise acquired by him in connection with the payment of loans granted under this title;

"(4) pursue to final collection, by way of compromise or otherwise, all claims against third parties assigned to the Administrator in connection with loans made by him. This shall include authority to obtain deficiency judgments or otherwise in the case of mortgages assigned to the Administrator. Section 3709 of the Revised Statutes, as amended (41 U. S. C. 5), shall not be construed to apply to any contract of hazard insurance or to any purchase or contract for services or supplies on account of property obtained by the Administrator as a result of loans made under this title if the premium therefor or the amount thereof does not exceed $1,000. The power to convey and to execute in the name of the Administrator deeds of conveyance, deeds of release, assignments and satisfactions of mortgages, and any other written instrument relating to real property or any interest therein acquired by the Administrator pursuant to the provisions of this title may be exercised by the Administrator or by any officer or agent appointed by him without the execution of any express delegation of power or power of attorney. Nothing in this section shall be construed to prevent the Administrator from delegating such power by order or by power of attorney, in his discretion, to any officer or agent he may appoint;

"(5) acquire, in any lawful manner, any property (real, personal, or mixed, tangible or intangible), whenever deemed necessary or appropriate to the conduct of the activities authorized in sections 207 (a), 207 (b), or 208 (a) of this title;

"(6) in addition to any powers, functions, privileges, and immunities otherwise vested in him, take any and all actions, including the procurement of the services of attorneys by contract, determined by him to be necessary or desirable in making, servicing, compromising, modifying, liquidating, or otherwise dealing with or realizing on loans made under the provisions of this title: Provided, That no attorneys' services shall be procured by contract in any office where an attorney or attorneys are or can be economically employed full time to render such services;

"(7) pay the transportation expenses and per diem in lieu of subsistence expenses, in accordance with the Travel Expense Act of 1949, for travel of any person employed by the Administration to render temporary services not in excess of six months in connection with any disaster referred to in section 207 (b) of this title, from place of appointment to, and while at, the disaaster area and any other temporary posts of duty and return upon completion of the assignment;

"(8) to accept the services and facilities of Federal, State, and local agencies and groups, both public and private, and utilize such gratuitous services and facilities as may, from time to time, be necessary to further the objectives of this title;

"(9) make such rules and regulations as he deems necessary to carry out the authority vested in him by or pursuant to this title.

"(c) To such extent as he finds necessary to carry out the provisions of this title, the Administrator is hereby authorized to procure the temporary (not in excess of six months) service of experts or consultants or organizations thereof, including stenographic reporting services, by contract or appointment, and in such cases such service shall be without regard to the civil-service and classifica-tion laws, and, except in the case of stenographic reporting services by organizations, without regard to section 3709, Revised Statutes, as amended (41 U. S. C. 5). Any individual so employed may be compensated at a rate not in excess of $50 per diem, and, while such individual is away from his home or reguular place of business, he may be allowed transportation and not to exceed $15 per diem in lieu of subsistence and other expenses.

"SEC. 206. (a) For the purposes enumerated in sections 207 (a), 207 (b) and 208 (a) and when authorized in appropriation acts, the Administrator may borrow from the Treasury through the issuance of obligations amounts not to exceed a total of $600,000,000 outstanding at any one time. Amounts so borrowed shall be placed in the revolving fund heretofore established under the au