What This Bill Does
This bill creates a 5-year pilot program that gives grants to organizations helping formerly incarcerated people (people who have completed prison time) start their own businesses. The grants support entrepreneurship training and business development programs for eligible individuals. The Small Business Administration runs the program.
Who It Affects
Formerly incarcerated individuals who meet eligibility requirements set by the Small Business Administration. Organizations and partnerships that provide business training and support. The Small Business Administration. Congress (which receives yearly reports).
Key Provisions
The Small Business Administration must establish the pilot program within 180 days of the bill becoming law and must award grants to organizations in amounts between $100,000 and $500,000 per year over 5 years. (Sec. 3(b) and (c))
Organizations receiving grants must have strong community connections, be able to partner with microloan providers (lenders who give small loans), and provide comprehensive business training programs. (Sec. 3(e))
Grant recipients must contribute 25 percent of the grant money from non-federal sources like donations or their own funds. (Sec. 3(g))
The administrator must submit yearly reports to Congress detailing who participated, how many businesses were started, loan amounts given, and whether participants avoided re-offending. (Sec. 3(i))
The program ends 5 years after the administrator establishes it. (Sec. 3(l))
What Changes
A new federal grant program begins that funds organizations helping formerly incarcerated people develop entrepreneurship skills and access microloans. These organizations must connect participants to federal resources like mentoring programs and women's business centers.
Important Definitions
"Covered individual" means someone who completed a prison or jail sentence and meets offense eligibility requirements set by the Small Business Administration.
"Intermediary" and "microloan" have the meanings given in existing Small Business Administration law.
"Microloan intermediary" means an organization already approved to participate in the Small Business Administration's existing microloan program.
Effective Date
The administrator must establish the pilot program within 180 days after the bill becomes law. The program terminates 5 years after establishment.
II
118TH CONGRESS
1ST SESSION
S. 609
To establish a pilot program awarding competitive grants to organizations
administering entrepreneurial development programming to formerly in-
carcerated individuals, and other purposes.
IN THE SENATE OF THE UNITED STATES
MARCH 1, 2023
Mr. CARDIN introduced the following bill; which was read twice and referred
to the Committee on Small Business and Entrepreneurship
A BILL
To establish a pilot program awarding competitive grants
to organizations administering entrepreneurial develop-
ment programming to formerly incarcerated individuals,
and other purposes.
Be it enacted by the Senate and House of Representa-
1
tives of the United States of America in Congress assembled,
2
SECTION 1. SHORT TITLE.
3
This Act may be cited as the ‘‘Necessary Entrepre-
4
neurship Workshops via the SBA to Transform and Assist
5
Re-entry Training Act of 2023’’ or the ‘‘NEW START
6
Act of 2023’’.
7
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•S 609 IS
SEC. 2. FINDINGS.
1
Congress finds that—
2
(1) according to the Department of Justice,
3
every year, over 600,000 individuals are released
4
from prison and return home to their communities,
5
and almost 77 percent of those individuals will re-
6
offend within 5 years;
7
(2) according to the Brookings Institution, an
8
estimated 48.5 percent of formerly incarcerated indi-
9
viduals will remain unemployed or earn a negligible
10
income for a period of 1 year post-incarceration, in-
11
creasing the risk for recidivism;
12
(3) according to the Florida State University
13
Institute for Justice Research and Development, for-
14
merly incarcerated individuals see a reduction in
15
earnings of 25 percent since criminal records make
16
it difficult to find stable employment;
17
(4) self-employment can provide economic sta-
18
bility for those who are otherwise locked out of the
19
labor market; and
20
(5) according to a paper entitled ‘‘Entrepre-
21
neurship as a Response to Labor Market Discrimi-
22
nation for Formerly Incarcerated People’’—
23
(A) the average individual without a crimi-
24
nal record has a 7.09 percent likelihood of be-
25
coming an entrepreneur, but justice-impacted
26
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•S 609 IS
individuals were found to be more than 50 per-
1
cent likely to choose entrepreneurship with a
2
12.69 percent likelihood of becoming an entre-
3
preneur;
4
(B) entrepreneurship reduces the likelihood
5
of recidivism by 5.3 percent, which was a 32.5
6
percent decrease from average recidivism rates
7
for regular employees who have been previously
8
incarcerated; and
9
(C) formerly incarcerated individuals who
10
choose entrepreneurship make $2,700 more an-
11
nually than formerly incarcerated employees
12
and that the income gap between formerly in-
13
carcerated entrepreneurs and entrepreneurs
14
with no criminal record was 38 percent lower
15
than the income gap between formerly incarcer-
16
ated employees and employees with no criminal
17
record.
18
SEC. 3. PILOT PROGRAM.
19
(a) DEFINITIONS.—In this Act—
20
(1) the terms ‘‘Administration’’ and ‘‘Adminis-
21
trator’’ mean the Small Business Administration
22
and the Administrator thereof, respectively;
23
(2) the term ‘‘appropriate committees of Con-
24
gress’’ means—
25
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•S 609 IS
(A) the Committee on Small Business and
1
Entrepreneurship of the Senate; and
2
(B) the Committee on Small Business of
3
the House of Representatives;
4
(3) the term ‘‘covered individual’’ means an in-
5
dividual who—
6
(A) completed a term of imprisonment in
7
Federal, State, or local jail or prison; and
8
(B) meets the offense eligibility require-
9
ments set forth in any applicable policy notice
10
or other guidance issued by the Small Business
11
Administration for the program established
12
under section 7(m) of the Small Business Act
13
(15 U.S.C. 636(m));
14
(4) the terms ‘‘intermediary’’ and ‘‘microloan’’
15
have the meanings given those terms in section
16
7(m)(11) of the Small Business Act (15 U.S.C.
17
636(m)(11));
18
(5) the term ‘‘microloan intermediary’’ means
19
an intermediary that is eligible to participate in the
20
program established under section 7(m) of the Small
21
Business Act (15 U.S.C. 636(m));
22
(6) the term ‘‘pilot program’’ means the pilot
23
program established under subsection (b); and
24
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•S 609 IS
(7) the term ‘‘small business development cen-
1
ter’’ has the meaning given the term in section 3 of
2
the Small Business Act (15 U.S.C. 632).
3
(b) ESTABLISHMENT.—Not later than 180 days after
4
the date of enactment of this Act, the Administrator shall
5
establish a pilot program to award grants to organizations
6
over a 5-year period to create or support existing entrepre-
7
neurship development programs to provide assistance to
8
covered individuals.
9
(c) GRANT
REQUIREMENTS.—The Administrator
10
shall—
11
(1) award grants under the pilot program to or-
12
ganizations, or partnerships of organizations, which
13
shall each receive a grant in an amount greater than
14
$100,000 and less than $500,000 annually over the
15
5-year period in which the pilot program is in exist-
16
ence; and
17
(2) allocate grants under the pilot program to
18
ensure that the recipients are geographically varied
19
throughout the United States.
20
(d) PARTNERSHIPS.—An applicant for a grant under
21
the pilot program may form partnerships with other orga-
22
nizations for the purposes of the application submitted
23
under subsection (e) and for conducting entrepreneurial
24
development programming.
25
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•S 609 IS
(e) APPLICATION.—
1
(1) IN GENERAL.—An organization or partner-
2
ship of organizations desiring a grant under the
3
pilot program shall submit an application to the Ad-
4
ministrator in such form, in such manner, and con-
5
taining such information as the Administrator may
6
reasonably require.
7
(2)
CONTENTS.—An
application
submitted
8
under paragraph (1) shall—
9
(A) demonstrate that the applicant is a
10
microloan intemediary or an organization that
11
administers the Community Advantage Pilot
12
Program of the Administration, or has a part-
13
nership with such an intermediary or organiza-
14
tion, that may provide microloans to qualified
15
covered individuals, or, to the extent that the
16
applicant is a national organization in multiple
17
different markets, that a separate microloan
18
intermediary may be used in each such market;
19
(B) demonstrate strong community ties,
20
including those with the covered individual com-
21
munity, local businesses, and political leaders;
22
(C) demonstrate an ability to provide a full
23
range of entrepreneurial development program-
24
ming on an ongoing basis;
25
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•S 609 IS
(D) include a plan for reaching covered in-
1
dividuals, including by identifying particular
2
target populations within the community;
3
(E) clearly define entrepreneurial develop-
4
ment capabilities, including coordination with
5
existing local resource partners of the Adminis-
6
tration for additional training as necessary;
7
(F) present an entrepreneurship develop-
8
ment curriculum, which may be a nationally
9
recognized model or based upon such a model;
10
(G) include a list of each partner organiza-
11
tion; and
12
(H) include a comprehensive plan for the
13
use of grant funds, including estimates for ad-
14
ministrative and outreach costs of running and
15
evaluating the entrepreneurship development
16
program.
17
(f) PRIORITY.—In determining whether to award a
18
grant under the pilot program, the Administrator may
19
give priority to applicants based on—
20
(1) whether the application includes a commit-
21
ment from an existing or new non-Federal funding
22
source to meet the matching requirement under sub-
23
section (g);
24
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•S 609 IS
(2) whether the application takes into account
1
local economies and markets as a part of the edu-
2
cational component of the entrepreneurship develop-
3
ment program;
4
(3) the ability or plan of the applicant to pro-
5
vide entrepreneurial development services concurrent
6
with employment or job training services; and
7
(4) whether the applicant has a history of effec-
8
tively providing entrepreneurial training or access to
9
capital to covered individuals.
10
(g) MATCHING REQUIREMENT.—
11
(1) IN GENERAL.—As a condition of a grant
12
provided under the pilot program, the Administrator
13
shall require the recipient of the grant to contribute
14
an amount equal to 25 percent of the amount of the
15
grant, obtained solely from existing or new non-Fed-
16
eral sources.
17
(2) FORM.—In addition to cash or other direct
18
funding, the contribution required under paragraph
19
(1) may include indirect costs or in-kind contribu-
20
tions paid for under non-Federal programs.
21
(h) RESPONSIBILITIES.—A recipient of a grant under
22
the pilot program shall, to the maximum extent possible,
23
connect covered individuals to a range of Federal re-
24
sources, including—
25
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•S 609 IS
(1) the program established under section 7(m)
1
of the Small Business Act (15 U.S.C. 636(m));
2
(2) the Community Advantage Pilot Program of
3
the Administration;
4
(3) small business development centers;
5
(4) women’s business centers described in sec-
6
tion 29 of the Small Business Act (15 U.S.C. 656);
7
(5) chapters of the Service Corps of Retired Ex-
8
ecutives established under section 8(b)(1)(B) of the
9
Small Business Act ((15 U.S.C. 637(b)(1)(B));
10
(6) Veteran Business Outreach Centers de-
11
scribed in section 32 of the Small Business Act (15
12
U.S.C. 657b); and
13
(7) business centers established by the Minority
14
Business Development Agency.
15
(i) REPORTS.—
16
(1) IN GENERAL.—Not later than 1 year after
17
the date on which the Administrator establishes the
18
pilot program, and every year thereafter until the
19
pilot program terminates, the Administrator shall
20
submit to Congress a report on the activities of the
21
pilot program, including—
22
(A) a list of each grantee organization and
23
each partner organization;
24
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•S 609 IS
(B) the characteristics of covered individ-
1
uals assisted under the entrepreneurship devel-
2
opment programs, including race and ethnicity,
3
gender, age, marital status, parental status,
4
employment status, income, banking and credit
5
history, and prior business experience;
6
(C) the participation and attendance rates
7
for all components of the entrepreneurship de-
8
velopment programs;
9
(D) the program retention rate;
10
(E) to the greatest extent practicable, the
11
most common reasons why participants do not
12
complete the program;
13
(F) the percentage of participants who re-
14
main non-justice involved during the calendar
15
year of the program;
16
(G) the level of the covered individuals’ un-
17
derstanding of business concepts and principles;
18
(H) the level of the covered individuals’
19
greater confidence in leadership strengths, in-
20
cluding the results of an industry-recognized be-
21
havioral assessment;
22
(I) the covered individuals’ progress made
23
toward establishing a business;
24
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•S 609 IS
(J) the experiences and perceptions of the
1
covered individuals;
2
(K) the number and dollar amount of loans
3
made to covered individuals;
4
(L) the number and dollar amount of loans
5
made or guaranteed by the Administration to
6
covered individuals; and
7
(M) such additional information as the Ad-
8
ministrator may require.
9
(2) GAO REPORT.—Not later than 1 year after
10
the date on which the pilot program terminates, the
11
Comptroller General of the United States shall sub-
12
mit to the appropriate committees of Congress a re-
13
port that evaluates—
14
(A) the services that grant recipients pro-
15
vided to covered individuals assisted under en-
16
trepreneurship development programs;
17
(B) oversight of the pilot program by the
18
Administrator, including policies and proce-
19
dures for monitoring the compliance by grant
20
recipients with pilot program requirements and
21
an assessment of the effectiveness of the pilot
22
program; and
23
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(C) the overall performance of the pilot
1
program and the impacts of the pilot program
2
on grant recipients.
3
(j) RULE OF CONSTRUCTION.—Nothing in this Act
4
may be construed to affect the program established under
5
section 7(m) of the Small Business Act (15 U.S.C.
6
636(m)), including—
7
(1) the requirements of that program;
8
(2) the manner in which that program is car-
9
ried out; or
10
(3) the use or availability of any amounts that
11
have been made available to carry out that program.
12
(k) AUTHORIZATION
OF APPROPRIATIONS.—There
13
are authorized to be appropriated to the Administrator
14
such sums as are necessary to carry out the pilot program.
15
(l) TERMINATION.—The pilot program shall termi-
16
nate on the date that is 5 years after the date on which
17
the Administrator establishes the pilot program.
18
Æ
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