Economic Opportunity Act of 1964, as Amended, Prepared for the Subcommittee on Employment, Manpower, and Poverty of the ... February 1967

LOAN TERMS AND CONDITIONS

SEC. 305. Loans pursuant to sections 302 and 303 shall have such terms and conditions as the Director shall determine, subject to the following limitations:

(a) there is reasonable assurance of repayment of the loan;

(b) the credit is not otherwise available on reasonable terms from private sources or other Federal, State, or local programs;

(c) the amount of the loan, together with other funds available, is adequate to assure completion of the project or achievement of the purposes for which the loan is made;

(e) with respect to loans made pursuant to section 303, the loan is repayable within not more than thirty years; and

(f) no financial or other assistance shall be provided under this part to or in connection with any corporation or cooperative organization for the production of agricultural commodities or for manufacturing purposes: Provided,1 That (1) 2 packing, canning, cooking, freezing, or other processing used in preparing or marketing edible farm products, including dairy products, shall not be regarded as manufacturing merely by reason of the fact that it results in the creation of a new or different substance; and (2) a cooperative organization formed by and consisting of members of an Indian tribe (including any tribe with whom the special Federal relationship with Indians has been terminated) engaged in the production of agricultural commodities, or in manufacturing products, on an Indian reservation (or former reservation in the case of tribes with whom the special Federal relationship with Indians has been terminated) shall not be regarded as a cooperative organization within the purview of this clause.

PART B-ASSISTANCE FOR MIGRANT, AND OTHER SEASONALLY EMPLOYED, AGRICULTURAL EMPLOYEES AND THEIR FAMILIES

SEC. 311.4 The Director is authorized to develop and implement a program of loans, loan guarantees, and grants to assist State and local agencies, private nonprofit institutions, and cooperatives in establishing, administering, and operating programs which will meet, or substantially and primarily contribute to meeting, the special needs of

1 This proviso added by sec. 22 of the Economic Opportunity Amendments of 1965, 79 Stat. 977. 2 Sec. 301 (b) of the Economic Opportunity Amendments of 1966, 80 Stat. 1464, 1465, amended sec. 305(f) by inserting "(1)" immediately after "Provided, That" and adding the words beginning with "and (2)" as set forth in the text.

See note 2, supra.

4 Sec. 23 of the Economic Opportunity Amendments of 1965, 79 Stat. 977, amended sec. 311 to read as set forth in the text. Prior to this amendment, sec. 311 read as follows:

"The Director shall develop and implement as soon as practicable a program to assist the States, political subdivisions of States, public and nonprofit agencies, institutions, organizations, farm associations, or individuals in establishing and operating programs of assistance for migrant, and other seasonally employed, agricultural employees and their families which programs shall be limited to housing, sanitation, education, and day care of children. Institutions, organizations, farm associations, or individuals shall be limited to direct loans."

migratory workers and seasonal farm laborers and their families in the fields of housing, sanitation, education, and day care of children.

PART CDURATION OF PROGRAM

SEC. 321. The Director shall carry out the programs provided for in this title during the fiscal year ending June 30, 1967, and the three succeeding fiscal years. For each such fiscal year only such sums may be appropriated as the Congress may authorize by law.2

PART D-INDEMNITY PAYMENTS TO DAIRY FARMERS

SEC. 331. (a) The Secretary of Agriculture is authorized to make indemnity payments, at a fair market value, to dairy farmers who have been directed since January 1, 1964, to remove their milk from commercial markets because it contained residues of chemicals registered and approved for use by the Federal Government at the time of such use. Such indemnity payments shall continue to each dairy farmer until he has been reinstated and is again allowed to dispose of his milk on commercial markets.

(b) There is hereby authorized to be appropriated such sums as may be necessary to carry out the purposes of this Act.

TITLE IV-EMPLOYMENT AND INVESTMENT

INCENTIVES 4

STATEMENT OF PURPOSE

SEC. 401. It is the purpose of this title to assist in the establishment, preservation, and strengthening of small business concerns and improve the managerial skills employed in such enterprises; and to

1 Sec. 302 of the Economic Opportunity Amendments of 1966, 80 Stat. 1465, amended Part C to read as set forth in the text. Prior to this amendment, Part C read as follows:

"PART C-AUTHORIZATION OF APPROPRIATIONS

"SEC. 321. The Director shall carry out the program provided for in this title during the fiscal year ending June 30, 1965, and the three succeeding fiscal years. For the purpose of carrying out this title, there is hereby authorized to be appropriated the sum of $35,000,000 for the fiscal year ending June 30, 1965, and the sum of $55,000,000 for the fiscal year ending June 30, 1966; and for the fiscal year ending June 30, 1967, and the succeeding fiscal year, such sums may be appropriated as the Congress may hereafter authorize by law. Not to exceed $15,000,000 of the funds appropriated under other titles of this Act for the fiscal year ending June 30, 1965, may also be utilized for the purposes of part B of this title." Prior to the Economic Opportunity Amendments of 1966, sec. 321 had been amended by sec. 30(c) of the Economic Opportunity Amendments of 1965, 79 Stat. 979, which extended the duration of title III programs one additional year (through fiscal 1968) and authorized the appropriation of funds for fiscal year 1966.

2 Sec. 2(a) of the Economic Opportunity Amendments of 1966, 80 Stat. 1451, authorizes appropriation, for the fiscal year ending June 30, 1967, of $57,000,000 for title III.

Sec. 301 (c) of the Economic Opportunity Amendments of 1966, 80 Stat. 1465, amended sec. 331 (c) by striking out "June 30, 1966" and inserting "June 30, 1967". Previously, sec. 24 of the Economic Opportunity Amendments of 1965, 79 Stat. 977, extended the termination date for Part D to June 30 1966. Sec. 331 (c) originally provided a termination date of January 31, 1965. This was subsequently extended to June 30, 1965, by sec. 303 of the Second Supplemental Appropriation Act, 1965, Public Law 89-16, April 30, 1965, 79 Stat. 81, 108.

4 Title IV of the Economic Opportunity Amendments of 1966, 80 Stat. 1465, transferred administration of this title, except new section 402(b) relating to grant support, from the Director of the Office of Economic Opportunity to the Administrator of the Small Business Administration. References to the "Director" which appeared in section 402 and former sections 405 and 406 were deleted and the Administrator of the Small Business Administration substituted by sec. 401 of the Economic Opportunity Amendments of 1966, 80 Stat. 1465. Prior to the Economic Opportunity Amendments of 1966, powers of the Director under title IV had been delegated to the Administrator subject to the reporting and coordination provisions of sec. 611 of the Economic Opportunity Act of 1964 by a delegation approved by the President on October 24, 1964, 29 F.R. October 29, 1964.

mobilize for these objectives private as well as public managerial skills and resources.

LOANS, PARTICIPATIONS, AND GUARANTIES

SEC. 402. (a) The Administrator 2 of the Small Business Administration is authorized to make, participate (on an immediate basis) in, or guarantee loans, repayable in not more than fifteen years, to any small business concern (as defined in section 3 of the Small Business Act (15 U.S.C. 632) and regulations issued thereunder), or to any qualified person seeking to establish such a concern, when he determines that such loans will assist in carrying out the purposes of this title, with particular emphasis on employment of the long-term unemployed: Provided, however, That no such loans shall be made, participated in, or guaranteed if the total of such Federal assistance to a single borrower outstanding at any one time would exceed $25,000. The Administrator of the Small Business Administration may defer payments on the principal of such loans for a grace period and use such other methods as he deems necessary and appropriate to assure the successful establishment and operation of such concern. The Administrator of the Small Business Administration may, in his discretion, as a condition of such financial assistance, require that the borrower take steps to improve his management skills by participating in a management training program approved by the Administrator of the Small Business Administration. The Administrator of the Small Business Administration shall encourage, as far as possible, the participation of the private business community in the program of assistance to such concerns.

(b) The Director is authorized to make grants to, or contract with, public or private nonprofit agencies, or combinations thereof, to pay all or part of the costs necessary to enable such agencies to provide screening, counseling, management guidance, or similar assistance with respect to persons or small business concerns which receive or may be eligible for assistance under subsection (a). Financial assistance under this subsection shall be subject to the provisions of section 208 of this Act.

(b) 4 To the extent necessary or appropriate to carry out the programs provided for in this title the Administrator of the Small Business Administration shall have the same powers as are conferred upon the Director by section 602 of this Act.

LOAN TERMS AND CONDITIONS

SEC. 403.5 Loans made pursuant to section 402 (including immediate participation in and guaranties of such loans) shall have such terms

1 Sec. 402 of the Act redesignated as sec. 402 (a) by sec. 402 of the Economic Opportunity Amendments of 1966, 80 Stat. 1465.

2 See note 4, page 32.

>This subsection added by sec. 402 of the Economic Opportunity Amendments of 1966, 80 Stat. 1465. This subsection added by sec. 405 of the Economic Opportunity Amendments of 1966, 80 Stat. 1465. This second subsection (b) is not in sequence in view of the amendment set forth in note 3, supra. 5 This section was formerly section 405 but was redesignated by sec. 406 of the Economic Opportunity Amendments of 1966, 80 Stat. 1465. Former section 403 was repealed by sec. 403 of the Economic Opportunity Amendments of 1966, 80 Stat. 1465. Before repeal, former sec. 403 read as follows:

"SEC. 403. No financial assistance shall be provided under section 402 in any community for which the Director has approved a community action program pursuant to title II of this Act unless such financial assistance is determined by him to be consistent with such program."

and conditions as the Administrator of the Small Business Administration shall determine, subject to the following limitations

(a) there is reasonable assurance of repayment of the loan;

(b) the financial assistance is not otherwise available on reasonable terms from private sources or other Federal, State, or local programs;

(c) the amount of the loan, together with other funds available, is adequate to assure completion of the project or achievement of the purposes for which the loan is made:

(d) the loan bears interest at a rate not less than (1) a rate determined by the Secretary of the Treasury, taking into consideration the average market yield on outstanding Treasury obligations of comparable maturity, plus (2) such additional charge, if any, toward covering other costs of the program as the Administrator of the Small Business Administration may determine to be consistent with its purposes: Provided, however, That the rate of interest charged on loans made in redevelopment areas designated under the Area Redevelopment Act (42 U.S.C. 2501 et seq.) 2 shall not exceed the rate currently applicable to new loans made under section 6 of that Act (42 U.S.C. 2505); and

(e) fees not in excess of amounts necessary to cover administrative expenses and probable losses may be required on loan guaranties.

LIMITATION ON FINANCIAL ASSISTANCE

SEC. 404. No financial assistance shall be extended pursuant to this title where the Administrator of the Small Business Administration determines that the assistance will be used in relocating establishments from one area to another or in financing subcontractors to enable them to undertake work theretofore performed in another area by other subcontractors or contractors.

DURATION OF PROGRAM

SEC. 405.5 The Administrator of the Small Business Administration shall carry out the programs provided for in this title during

1 See note under title IV heading, supra.

2 The Area Redevelopment Act expired on August 31, 1965, its original termination date of June 30, 1965, having been extended to the later date by Public Law 89-55, June 30, 1965, 79 Stat. 195. Section 715 of the Public Works and Economic Development Act (Public Law 89-136, August 26, 1965, 79 Stat. 552, 575) provides that benefits available under other Federal programs to recipients in areas designated "redevelopment areas" under the Area Redevelopment Act are available to recipients in areas so designated under the Public Works and Economic Development Act.

This section was formerly section 406 but was redesignated by sec. 406 of the Economic Opportunity Amendments of 1966, 80 Stat. 1465. Former section 404 was repealed by sec. 403 of the Economic Opportunity Amendments of 1966, 80 Stat. 1465. Before repeal, former sec. 404 read as follows:

"SEC. 404. Such lending and guaranty functions under this title as may be delegated to the Small Business Administration may be financed with funds appropriated to the revolving fund established by section 4 (c) of the Small Business Act (15 U.S.C. 633 (c)) for the purposes of sections 7(a), 7(b), and 8(a) of that Act (15 U.S.C. 636(a), 636(b), 637(a)).”

4 See note under title IV heading, supra.

Formerly section 407, this section was renumbered by section 406 of the Economic Opportunity Amendments of 1966, 80 Stat. 1465, and amended to read as set forth in the text of sec. 404 of such Amendments. Before this amendment, this section read as follows:

"The Director shall carry out the programs provided for in this title during the fiscal year ending June 30, 1965, and the two succeeding fiscal years.'

the fiscal year ending June 30, 1967, and the three succeeding fiscal years.1

TITLE V 2-WORK EXPERIENCE AND TRAINING

PROGRAMS 3

STATEMENT OF PURPOSE

SEC. 501. It is the purpose of this title to expand the opportunities for constructive work experience and other needed training available to persons (including workers in farm families with less than $1,200 net family income, unemployed heads of families and other needy persons) who are unable to support themselves or their families.

TRANSFER OF FUNDS

SEC. 502. In order to permit the carrying out of work experience and training programs meeting the criteria set forth in part E of title II of the Manpower Development and Training Act of 1962, the Director is authorized to transfer funds to the Secretary of Health, Education, and Welfare to enable him (1) to make payments under section 1115 of the Social Security Act for experimental, pilot, or demonstration projects which provide pretraining services and basic maintenance, health, family, basic education, day care, counseling, and similar supportive services required for such programs, and (2) to reimburse the Secretary of Labor for carrying out the activities described in such part E of title II of the Manpower Development and Training Act of 1962. Costs of such projects and activities shall, notwithstanding the provisions of the Social Security Act and the Manpower Development and Training Act of 1962, be met entirely from funds appropriated to carry out this title: Provided, That such funds may not be used to assist families and individuals insofar as they are otherwise receiving or eligible to receive assistance or social services through a State plan approved under titles I, IV, X, XIV, XVI, or XIX of the Social Security Act.

LIMITATIONS ON WORK EXPERIENCE AND TRAINING PROGRAMS

SEC. 503. (a) The provisions of paragraphs (1) to (6), inclusive, of section 409 of the Social Security Act, unless otherwise inconsistent with the provisions of this title, shall be applicable with respect to

1 Sec. 4(c) (1) of the Small Business Act, as amended by Public Law 89-409, May 2, 1966, 80 Stat. 132, 133, establishes in the Treasury a business loan and investment fund which will be available for financing functions, including related administrative expenses, proposed under various sections or parts of the Small Business Act, the Small Business Investment Act, and title IV of the Economic Opportunity Act. Sec. 4(c) (4) of the Small Business Act, as so amended, provides that the total amount of loans, guaranties, and other obligations or commitments outstanding at any one time under title IV shall not exceed $100,000,000. In addition to loan financing provided under the Small Business Act, sec. 2(a) of the Economic Opportunity Amendments of 1966, 80 Stat. 1451, authorizes appropriation, for the fiscal year ending June 30, 1967, of $5,000,000 for carrying out sec. 402(b) relating to grants or contracts with public or private nonprofit agencies.

2 Title V of the Act was revised and amended to read as set forth in the text by sec. 501 of the Economic Opportunity Amendments of 1966, 80 Stat. 1466, 1467. Title V, as it was originally enacted and amended by the Economic Opportunity Amendments of 1965, is set forth at the end of revised title V. Powers of the Director of the Office of Economic Opportunity under title V, other than the power to transfer funds under section 502, were delegated to the Secretary of Health, Education, and Welfare, subject to the reporting and coordination provisions of sec. 611 of the Economic Opportunity Act, by a delegation approved by the President on October 24, 1964, 29 F.R. 14764, October 29, 1964.

4 Part E was added to title II of the Manpower Development and Training Act by sec. 1001 (c) of the Economic Opportunity Amendments of 1966, 80 Stat. 1475, and is set forth in a note at the end of this title.

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Economic Opportunity Act of 1964, as Amended, Prepared for the Subcommittee ...