68th OREGON LEGISLATIVE ASSEMBLY--1995 Regular Session
NOTE: Matter within { + braces and plus signs + } in an
amended section is new. Matter within { - braces and minus
signs - } is existing law to be omitted. New sections are within
{ + braces and plus signs + } .
LC 1285
House Bill 2400
Sponsored by Representative GORDLY
SUMMARY
The following summary is not prepared by the sponsors of the
measure and is not a part of the body thereof subject to
consideration by the Legislative Assembly. It is an editor's
brief statement of the essential features of the measure as
introduced.
Creates Oregon Small Business and Minority or Women Owned
Business Development Act by expanding Oregon Small Business
Development Act to explicitly include minority owned and women
owned businesses. Defines terms.
Requires Economic Development Department and Advocate for
Minority, Women and Emerging Small Business to work together to
provide coordinated referral, education, outreach, training and
professional assistance services in cost-effective manner to
small businesses and minority or women owned businesses.
Requires that State Treasurer establish linked deposit program.
Establishes Small Business and Minority or Women Owned Business
Alternative Loan Fund and Small Business and Minority or Women
Owned Business Alternative Loan Fund Committee.
Creates Oregon Small Business and Minority or Women Owned
Business Bonding Assistance Fund.
Declares emergency, effective on passage.
A BILL FOR AN ACT
Relating to economic development; creating new provisions;
amending ORS 200.005, 200.025, 200.055, 200.065, 200.075,
285.500, 285.503, 285.507, 285.510, 285.515, 285.517, 285.530,
285.533, 285.537, 285.540, 285.543, 285.547, 285.550 and
285.555; and declaring an emergency.
Be It Enacted by the People of the State of Oregon:
SECTION 1. ORS 285.500 is amended to read:
285.500. ORS 271.510, 271.520, 285.310 to 285.320, 285.335,
285.345, 285.350, 285.360, 285.385, 285.393 to 285.397, 285.443,
285.503, 285.540 to 285.547, 657.471, 659.027 and 777.250 shall
be known as the Oregon Small Business { + and Minority or Women
Owned Business + } Development Act of { - 1983 - }
{ + 1995 + }.
SECTION 2. ORS 285.503 is amended to read:
285.503. (1) The Legislative Assembly finds that:
(a) Small businesses { - comprise - } { + constitute + }
more than 97 percent of the business entities in this state.
(b) Small businesses provide more than three-quarters of the
private sector jobs in this state.
(c) The small business contribution to the economy of this
state exceeds the national average contribution and its
continuance is vital to the economic health and growth of this
state.
(d) All national economic indicators establish that the
greatest source of future new jobs is in the small business
sector of the economy.
{ + (e) As a result of discrimination, only a small
percentage of the state's small businesses are owned by
minorities or women.
(f) Minority individuals and women constitute a substantial and
steadily increasing percentage of Oregon's workforce.
(g) It is necessary to the continued economic growth of the
state that minorities and women be provided opportunities to
contribute fully to the economy by becoming entrepreneurs,
business owners and contractors.
(h) It is further necessary to the economic growth of the state
that minority individuals and women be encouraged to participate
in general construction, public works projects, public facility
concessions and the international market trade.
(i) Many minority and women business owners lack management and
entrepreneurial skills because they have not had access to
opportunities to gain the experience needed to develop skills
that would enable them to compete successfully for business
financing, contracts and performance and other bonds.
(j) In order to contribute fully to the economy, minority
individuals and women must be able to compete successfully for
small business financing, contracts and bonds.
(k) In order to take advantage of existing and future
opportunities to compete successfully, minority individuals and
women require the availability of training, technical assistance
and assistance grants in the areas of entrepreneurship,
management, access to capital, finance, marketing, accounting and
record keeping. + }
(2) The purpose of the Oregon Small Business { + and Minority
or Women Owned Business + } Development Act of { - 1983 - }
{ + 1995 + } is to encourage and assist the development and
continued growth of small business { + and minority or women
owned businesses + } in this state.
(3) As used in the Oregon Small Business { + and Minority or
Women Owned Business + } Development Act of { - 1983, 'small
business' - } { + 1995:
(a) 'Minority individual' + } means { - a manufacturing
business having 200 or fewer employees and all other forms of
business having 50 or fewer employees. - } { + a person who is
a citizen or lawful permanent resident of the United States and
who is:
(A) Black American, which means a person having origins in any
of the black racial groups of Africa;
(B) Hispanic American, which means a person of Mexican, Puerto
Rican, Cuban, Central or South American or other Spanish or
Portuguese culture or origin, regardless of race;
(C) Asian-Pacific American, which means a person having origins
in Japan, China, Taiwan, Korea, Vietnam, Laos, Cambodia, the
Philippines, Samoa, Guam, the United States Trust Territories of
the Pacific or the Northern Marianas;
(D) Asian-Indian American, which means a person having origins
in India, Pakistan or Bangladesh;
(E) Native American, which means a person having American
Indian, Eskimo, Aleut or Native Hawaiian origins; or
(F) An 'economically disadvantaged individual' as that term is
defined in ORS 200.005.
(b) 'Small business' means:
(A) A small business concern as defined in ORS 200.005; or
(B) A disadvantaged business enterprise as defined in ORS
200.005.
(c) 'Minority or women owned business' means:
(A) A disadvantaged business enterprise as defined in ORS
200.005 that is at least 51 percent owned by one or more minority
individuals or women, or, in the case of a corporation, at least
51 percent of the stock of which is owned by one or more minority
individuals or women, and whose management and daily business
operations are controlled by one or more such individuals; or
(B) A minority or women business enterprise as that term is
defined in ORS 200.005.
(d) 'Woman' has the meaning given in ORS 200.005. + }
(4) The provisions of ORS 285.500 and 657.471 are intended to
assist in carrying out the Oregon Small Business { + and
Minority or Women Owned Business + } Development Act of
{ - 1983 - } { + 1995 + }.
SECTION 3. ORS 285.507 is amended to read:
285.507. As used in ORS 285.507 to 285.527, unless the context
requires otherwise:
(1) 'Financial institution' means a financial institution, as
defined in ORS 706.005.
(2) 'Loss reserve account' means an account in the State
Treasury or any financial institution which is established and
maintained by the Economic Development Department for the benefit
of a financial institution participating in the capital access
program established under ORS 285.507 to 285.527.
(3) 'Qualified business' means any person, conducting business
for profit, that is authorized to conduct business in the State
of Oregon { + and includes any small business or minority or
women owned business as defined in ORS 285.503 + }.
(4) 'Qualified loan' means a loan or portion of a loan made by
a financial institution to a qualified business { + and includes
a loan or portion of a loan made to a small business or a
minority or women owned business + } for any business activity
that has its primary economic effect in Oregon. The term does not
include:
(a) A loan for the construction or purchase of residential
housing.
(b) A loan for purchase of real property that is not used for
the business operations of the borrower.
(c) A loan for the refinancing of an existing loan when and to
the extent that the outstanding balance is not increased.
SECTION 4. ORS 285.510 is amended to read:
285.510. (1) The Legislative Assembly finds that:
(a) There is a persistent shortage of equity capital available
to small { + businesses and minority or women owned + }
businesses in Oregon.
(b) Small businesses make important contributions to economic
growth and vitality in this state.
{ + (c) Both minority and women owned businesses have the
potential to make important contributions to economic growth and
vitality in this state. + }
{ - (c) - } { + (d) + } Many financial institutions in
Oregon are limited in their ability to provide financing to small
{ + businesses and minority or women owned businesses + }
{ - but - } { + that are new or + } rapidly growing
{ - businesses - } .
(2) It is the purpose of ORS 285.507 to 285.527 to establish a
capital access program under which the State of Oregon will
provide public fiscal resources to assist Oregon financial
institutions to overcome obstacles and constraints in meeting the
full range of economically sound financing needs of Oregon
{ + small businesses and minority or women owned + } businesses.
SECTION 5. { + Notwithstanding ORS 285.513, until August 1,
2000, ORS 285.513 shall not be operative, but section 6 of this
Act shall be operative in lieu thereof. + }
SECTION 6. { + (1) The State Treasurer shall establish a
linked deposit program to provide a framework for linking state
time deposits made in financial institutions with small
businesses and minority or women owned businesses that require
assistance in gaining access to capital. When the State Treasurer
purchases a time deposit under the linked deposit program, the
financial institution from which the deposit is purchased shall
make a loan to a small business or a minority or women owned
business participating in the linked deposit program, in an
amount that is equal to the amount of the time deposit purchased.
To the extent permitted by federal law, the State Treasurer may
set interest rates on time deposits and linked deposit loans that
are consistent with the intent of ORS 285.503, 285.510, 285.533,
285.537, 285.540, 285.543 and 285.550 and sections 12, 13 and 17
of this Act. The State Treasurer shall make every effort to
insure that minority or women owned financial institutions have
an opportunity to participate in the linked deposit program.
(2) The Economic Development Department may contract with any
financial institution for the purpose of allowing the financial
institution to participate in the capital access program
established by ORS 285.507 to 285.527 by making either qualified
or linked deposit loans. The department shall make every effort
to insure that minority or women owned financial institutions
have an opportunity to participate in the capital access program.
(3) A contract between the Economic Development Department and
a financial institution for a qualified loan under this section
shall provide:
(a) For the creation of a loss reserve account by the
department for the benefit of the financial institution.
(b) That the financial institution, qualified small business or
qualified minority or women owned business and the department
will deposit moneys to the credit of the institution's loss
reserve account when the financial institution makes a qualified
loan to a qualified small business or qualified minority or women
owned business.
(c) That the department will pay moneys in the loss reserve
account, not exceeding an amount equal to the total amount
credited to the loss reserve account, to the financial
institution to reimburse the institution for any financial loss
incurred as a result of any qualified loan made under the capital
access program established by ORS 285.507 to 285.527.
(d) That the liability of the State of Oregon and the Economic
Development Department to the financial institution under the
contract is limited to the amount of money credited to the loss
reserve account of the institution.
(e) That the financial institution shall provide such
information as the department may require, including financial
information that is identifiable with, or identifiable from, the
financial records of a particular customer who is the recipient
of a qualified loan.
(f) For such other terms as the department may require.
(4) A financial institution is not subject to ORS 192.555 (1)
when the financial institution provides information to the
Economic Development Department as required by subsection (3)(e)
of this section.
(5) The Economic Development Department shall provide technical
assistance and loan packaging services that enable small
businesses and minority or women owned businesses to obtain
linked deposit loans under the linked deposit program.
(6) The State Treasurer and the Economic Development Department
shall monitor the repayment of loans made to small businesses and
minority or women owned businesses through the linked deposit
program.
(7) The State Treasurer may deposit in time deposits a sum not
to exceed $50 million per year of all funds available under this
section for the linked deposit program. The amount of moneys
available to the financial institutions under this section for
the linked deposit program shall be equal to the amount of
outstanding loans made under the linked deposit program.
(8) The State Treasurer may deposit moneys not required to meet
current demands for the linked deposit program in time deposits
for periods not to exceed five years and at interest rates and
upon such conditions as may be agreed upon by the State Treasurer
and the financial institution.
(9) As used in this section:
(a) A 'linked deposit loan' is a 'qualified loan ' described in
ORS 285.507 (4) that also:
(A) Has a repayment period that does not exceed five years;
(B) Is being made to a small business or a minority or women
owned business that has been certified under ORS 200.055;
(C) Has an interest rate that does not exceed the interest rate
on the corresponding time deposit made by the State Treasurer by
more than _____ percentage points; and
(D) Is a loan where the points or fees at loan closing are not
in excess of one percent of the loan amount.
(b) 'Time deposit' has the meaning given in ORS 706.005. + }
SECTION 7. { + (1) The State of Oregon and the state's agents
are not liable for the payment of the principal or interest on a
linked deposit loan made under section 6 of this Act. Any delay
in payment or default on the part of the borrower does not affect
the deposit agreement between the financial institution and the
State Treasurer.
(2) As used in this section, 'linked deposit loan' has the
meaning given in section 6 of this Act. + }
SECTION 8. ORS 285.515 is amended to read:
285.515. (1) The Economic Development Department shall
establish a loss reserve account for each financial institution
with which the department makes a contract under ORS 285.513.
(2) The loss reserve account for a financial institution shall
consist of moneys paid as fees by borrowers and the financial
institution under ORS 285.517 and moneys transferred to the
account from the Capital Access Fund under ORS 285.517.
(3) Notwithstanding ORS chapter 293 or 295, the department may
establish and maintain loss reserve accounts with any financial
institution under such policies as the department may adopt.
(4) All moneys in a loss reserve account established under ORS
285.507 to 285.527 are the property of the State of Oregon.
(5) The amounts transferred from the Capital Access Fund to a
loss reserve account on behalf of any single qualified
business { + , including a small business or a minority or women
owned business as defined in ORS 285.503, + } shall not exceed
$150,000.
SECTION 9. ORS 285.517 is amended to read:
285.517. (1) When a financial institution participates in the
capital access program established by ORS 285.507 to 285.527, if
the financial institution decides to enroll a qualified loan
{ + under + } the capital access program in order to obtain the
protection against loss provided by its loss reserve account, the
financial institution shall notify the Economic Development
Department of the loan within 10 days after the loan is made. The
notification shall be in writing on a form prescribed by the
department.
(2) When making a qualified loan that will be enrolled under
the capital access program, the financial institution shall
require the qualified business { + , including a small business
or a minority or women owned business as defined in ORS
285.503, + } to which the loan is made to pay a fee of not less
than two percent of the principal amount of the loan but not more
than three and one-half percent of such principal amount. The
financial institution shall also pay a fee in an amount equal to
the fee paid by the borrower. { + When the loan is a qualified
loan, + } the financial institution shall deliver the fees
collected under this subsection to the department for deposit in
the loss reserve account for the institution.
(3) When depositing fees collected under subsection (2) of this
section to the credit of the loss reserve account for a financial
institution, the department shall transfer an amount that is not
less than the total amount of the fees paid by the borrower and
the financial institution from the Capital Access Fund to the
loss reserve account for the institution.
SECTION 10. ORS 285.530 is amended to read:
285.530. In each fiscal year of a biennium, not less than
{ - 17 - } { + 25 + } percent of all moneys available for
lending from the Oregon Business Development Fund is reserved for
loans to businesses receiving loans in aggregate original
principal amount not exceeding $50,000. Any amounts reserved for
loans to such businesses that are not loaned in one fiscal year
shall be added to the amount reserved for loans to such
businesses in the subsequent fiscal year.
SECTION 11. { + Sections 12, 13, 24 to 27 and 30 of this Act
are added to and made a part of ORS chapter 285. + }
SECTION 12. { + (1) The Economic Development Department shall,
in coordination with the Advocate for Minority, Women and
Emerging Small Business appointed under ORS 200.025, develop an
outreach program for promoting the awareness of existing programs
and services available to small businesses and minority or women
owned businesses through the Economic Development Department and
the Advocate for Minority, Women and Emerging Small Business.
(2) The Economic Development Department shall work with the
Advocate for Minority, Women and Emerging Small Business to
provide, in a coordinated manner, the services required under ORS
285.500 to 285.555 and ORS chapter 200 to small businesses and
minority or women owned businesses. The Economic Development
Department shall make every effort to insure that the department
does not duplicate services offered by the Advocate for Minority,
Women and Emerging Small Business.
(3) The Economic Development Department, in coordination with
the Advocate for Minority, Women and Emerging Small Business,
shall work with federal, state and local agencies and
organizations to insure that the business assistance services
described in ORS chapter 200, ORS 285.507 to 285.527, 285.530,
285.537, 285.540 to 285.547, 285.550 and 285.555 and sections 6,
12, 13, 17, 24 and 30 of this 1995 Act are provided in a
coordinated and cost-effective manner.
(4) 'Small business' and 'minority or women owned business'
have the meanings given in ORS 285.503. + }
SECTION 13. { + (1) The Economic Development Department shall
establish a small business and minority or women owned business
export outreach program for the purpose of providing information
concerning the importance of international trade and the
opportunities available for small businesses and minority or
women owned businesses to engage in international trade.
(2) The department shall identify and document domestic and
international markets in which small businesses and minority or
women owned businesses may have an advantage.
(3) To the greatest extent practicable, the department shall
provide the technical assistance necessary to facilitate the
participation of small businesses and minority or women owned
businesses in international trade. + }
SECTION 14. ORS 285.533 is amended to read:
285.533. (1) The Legislative Assembly finds that:
(a) Small businesses have been the major contributors to the
increase in manufacturing jobs in Oregon.
{ + (b) Minority or women owned businesses are a potential
major source of manufacturing and other jobs in Oregon. + }
{ - (b) - } { + (c) + } Community-based lending programs
are particularly well suited to meeting the needs of small
businesses { + and minority or women owned businesses + } that
are unable to obtain { - from private financial
institutions - } the capital that is necessary for expansion.
{ - (c) - } { + (d) + } An effective partnership between
state and local economic development programs is essential to
promoting the development of small businesses { + and minority
or women owned businesses + } in this state.
(2) It is the policy of the State of Oregon and the purpose of
ORS 285.425 and 285.533 to 285.537 to provide support for local
development organizations that encourage and assist the
development and expansion of small businesses { + and women or
minority owned businesses + } in Oregon.
SECTION 15. ORS 285.537 is amended to read:
285.537. The Economic Development Department shall work with
local business development funds to strengthen the coordination
in the marketing of finance programs for small { - business - }
{ + businesses and minority or women owned businesses + }, the
review and analysis of loan applications and the operation of
publicly operated business finance programs.
SECTION 16. { + Sections 17 and 18 of this Act are added to
and made a part of ORS 285.507 to 285.527. + }
SECTION 17. { + (1) In addition to the capital access programs
described in ORS 285.513, the Economic Development Department
shall establish, in conjunction with the Office for Minority,
Women and Emerging Small Business, a Small Business and Minority
or Women Owned Business Alternative Loan Fund Committee for the
purpose of seeking, establishing and maintaining alternative loan
funding resources for small businesses and minority or women
owned businesses. The committee shall have loan approval powers
for loans extended under this subsection, subject to final
approval by the director of the department and the Advocate for
Minority, Women and Emerging Small Business. The committee shall
approve loan applications on a quarterly basis during each fiscal
year.
(2) The department shall prescribe by rule loan application and
loan approval processes that are consistent with the requirements
of federal and state law. To the extent that federal and state
law permit, and to offset the effects of past discrimination that
has precluded minorities and women from competing for small
business financing and access to capital, the department shall
include rules that incorporate and allow the committee to
consider nontraditional credit criteria when evaluating a loan
applicant's credit history.
(3) To the greatest extent practicable, the committee shall
provide all loan applicants equal opportunities to be fully
considered for loan moneys from the Small Business and Minority
or Women Owned Business Alternative Loan Fund established by
section 18 of this 1995 Act.
(4) The committee shall have eight members appointed jointly by
the Director of the Economic Development Department and the
Advocate for Minority, Women and Emerging Small Business. The
committee members shall be subject to the following
qualifications:
(a) Three members shall be experienced in the areas of
investment finance, providing capital access to new and
innovative businesses, starting up and operating businesses and
providing professional services to small or expanding businesses;
(b) Two members shall be residents of enterprise zones, as that
term is defined in ORS 285.570;
(c) One member shall represent a manufacturing business having
fewer than 200 employees;
(d) One member shall represent a minority owned business; and
(e) One member shall represent a women owned business.
(5) When appointing the members of the committee, the director
and the advocate shall consider the ethnic, cultural and
geographic diversity of the state.
(6) Each committee member shall serve a term of three years,
except that of the members first appointed, two shall serve
two-year terms and two shall serve one-year terms. The director
and the advocate shall fill a vacancy that occurs before a term
has expired in accord with the appointment procedure described in
this section. The member appointed shall serve for only the
unexpired term of the member who vacated the position. The
director and the advocate may remove a committee member only for
cause.
(7) The director and the advocate shall designate a member of
the committee as chairperson. Five members of the the committee
shall constitute a quorum.
(8) Committee members shall serve without compensation, but may
be reimbursed under ORS 292.495 for actual and necessary travel
expenses incurred in the performance of the members' official
duties.
(9) Committee members are not liable to the state or to the
loan fund or to any entity as a result of the activities of the
committee, except for acts of willful dishonesty or intentional
violations of law.
(10) As used in this section, 'small business' and ' minority
or women owned business' have the meanings given in ORS
285.503. + }
SECTION 18. { + (1) There is established in the State
Treasury, separate and distinct from the General Fund, the Small
Business and Minority or Women Owned Business Alternative Loan
Fund.
(2) The Small Business and Minority or Women Owned Business
Alternative Loan Fund shall consist of:
(a) Moneys appropriated to the fund by the Legislative
Assembly; and
(b) Moneys solicited from public and private resources by the
Small Business and Minority or Women Owned Business Alternative
Loan Fund Committee. + }
SECTION 19. ORS 285.540 is amended to read:
285.540. (1) The purpose of ORS 285.540 to 285.547 is to
establish a statewide network of community college-based small
business { + and minority or women owned business + }
development centers.
(2) The Legislative Assembly finds that it is in the state's
interest to help small businesses { + and minority or women
owned businesses + } develop and improve skills in such areas as
marketing, management, { + entrepreneurship, finance,
accounting, record keeping + } and capital formation through a
network of small business { + and minority or women owned
business + } development centers because:
(a) Small business employers create most of the new jobs in
Oregon and are vital to Oregon's long term economic recovery;
{ + (b) Minority or women owned business employers have the
potential to create new jobs in Oregon and are vital to Oregon's
long term economic growth; + }
{ - (b) - } { + (c) + } Community colleges present the
possibility of a statewide network able to link small business
{ + and minority or women owned business + } with college
resources, expert resource people in the business community and
with other training resources throughout the state; and
{ - (c) - } { + (d) + } While many factors affect the
vitality of small business { + and minority or women owned
business + }, training assistance in a form, location and time
directly related to the problem to be solved is chief among them.
(3) The Legislative Assembly also finds that it is cost
effective and in the state's interest to establish and maintain a
specialized, intensive instruction and contractor accreditation
program in community colleges for small business contractors and
minority or women owned business contractors that includes
instruction concerning the topics listed in subsection (2) of
this section and also includes instruction concerning the public
and private contract bidding processes and qualifying for and
obtaining performance bonds.
SECTION 20. ORS 285.543 is amended to read:
285.543. (1) The Economic Development Department { - may - }
{ + shall + } make available to community college and community
college service districts on a justified need basis grants to
assist in the formation and improvement of small business
{ + and minority or women owned business + } development
centers. The grant application shall include:
(a) Evidence of the potential demand for assistance;
(b) Plans for involving other training resources and expert
resource people from the business community in the program;
(c) An outline of training options to be available, including,
but not limited to, { + the availability of a specialized,
intensive instruction and contractor accreditation program for
small business and minority or women owned business contractors
that includes instruction concerning the subjects listed in ORS
285.540 (2) and (3) and the + } time of day, length of training,
training location and other considerations important to the small
business { + and minority or women owned business + } community;
(d) A budget for the year for which a grant is requested,
including college, client and Economic Development Department
grant shares; and
(e) A plan for evaluating the effect of the program on small
business { + and minority or women owned business + } clients
served.
(2) The grants made under subsection (1) of this section are to
be used by the community college or community college service
district to:
(a) Provide funds for { + small business and minority or women
owned business + } development center staff and support staff;
(b) Provide funds to retain expert resource persons from the
business community;
(c) Provide funds to retain other training resources as
necessary to enhance the training capability of the centers in
certain skill areas or areas of the state in instances where the
college or district can demonstrate it does not have the capacity
or expertise to provide such resources; and
(d) Provide funds for other costs related to operation of the
centers and provision of training to small business { + and
minority or women owned business + } clients.
(3) In no case shall the grants made under subsection (1) of
this section be used for the establishment, maintenance or
expansion of other public or private institutions providing
similar education services or to establish, maintain or expand
satellite centers or business assistance programs operated by
other public or private educational institutions.
(4) In order to be eligible for grants under subsection (1) of
this section, existing programs shall be required to provide
funds or in-kind contributions or some combination of funds and
contributions in accordance with rules adopted by the Economic
Development Department.
{ + (5) 'Contractor' has the meaning given in ORS
200.100. + }
SECTION 21. ORS 285.547 is amended to read:
285.547. ORS 285.540 to 285.547 shall be known and may be cited
as the 'Small Business { + and Minority or Women Owned
Business + } Training Assistance Act. '
SECTION 22. ORS 285.550 is amended to read:
285.550. In cooperation with other state and public agencies,
community colleges { - may - } { + shall + } develop programs
to assist Oregon businesses with the procurement of government
contracts and grants. The small business { + and minority or
women owned business + } development centers established under
ORS 285.540 to 285.547 { - may - } { + shall + } assist with
these programs.
SECTION 23. ORS 285.555 is amended to read:
285.555. (1) The small business { + and minority or women
owned business + } development centers shall develop and offer
special courses in management training for family child care
providers and owner operators of child care businesses.
(2) As part of promotional efforts, the centers shall
concentrate on encouraging women, family child care providers and
members of minority groups to participate in programs developed
under this section and ORS 285.553.
SECTION 24. { + (1) If a qualified contractor applies to an
approved surety company for a bond for a public or private
contracting job and the approved surety company denies the bond
application because the contractor is unable to meet the surety
company's requirements for reasons other than nonperformance, the
Economic Development Department may guarantee the contractor's
bond in an amount not to exceed $75,000, upon written request
from the contractor. The department shall prescribe by rule the
precise conditions under which the department may guarantee a
bond and the procedures that the department and the contractor
shall follow when a contractor requests a bond guarantee.
(2) As used in this section:
(a) 'Approved surety company' means a surety company approved
by the department for participation in providing direct bonding
assistance to qualified contractors;
(b) 'Bond' means any body or security required for bid, payment
or performance of contracts; and
(c) 'Qualified contractor' means any licensed and accredited
resident small business or minority or women owned business
certified by the department as eligible to obtain bonding
assistance under the department rules required by subsection (1)
of this section. + }
SECTION 25. { + (1) There is established in the State
Treasury, separate and distinct from the General Fund, the Oregon
Small Business and Minority or Women Owned Business Bonding
Assistance Fund.
(2) The Oregon Small Business and Minority or Women Owned
Business Bonding Assistance Fund shall consist of:
(a) Moneys appropriated to the fund by the Legislative
Assembly; and
(b) Moneys from any federal, state or other grants. + }
SECTION 26. { + The Economic Development Department shall
solicit funds from approved surety companies and other public and
private entities that have an interest in assisting Oregon's
small business and minority or women owned business
contractors. + }
SECTION 27. { + The Economic Development Department may accept
gifts, grants and endowments from public or private sources for
the use and benefit of the Oregon Small Business and Minority or
Women Owned Business Bonding Assistance Fund program provided
that the conditions thereon are consistent with the purposes of
ORS 285.503, 285.510, 285.533, 285.537, 285.540, 285.543 and
285.550 and sections 12, 13 and 17 of this 1995 Act. All such
funds shall be deposited in the State Treasury to the credit of
the Oregon Small Business and Minority or Women Owned Business
Bonding Assistance Fund. + }
SECTION 28. { + Section 29 of this Act is added to and made a
part of ORS chapter 200. + }
SECTION 29. { + (1) The Advocate for Minority, Women and
Emerging Small Business shall work with the Economic Development
Department to provide the services required under ORS chapter 200
and ORS 285.500 to 285.555 to small businesses and minority or
women owned businesses. The Advocate for Minority, Women and
Emerging Small Business shall make every effort to avoid
duplicating any services offered by the Economic Development
Department.
(2) In addition, the Advocate for Minority, Women and Emerging
Small Business, in coordination with the Economic Development
Department, shall work with federal, state and local agencies and
organizations to insure that the business assistance services
described in ORS chapter 200, ORS 285.507 to 285.527, 285.530,
285.537, 285.540 to 285.547, 285.550 and 285.555 and sections 6,
12, 13, 17, 24 and 30 of this 1995 Act are provided in a
coordinated and cost-effective manner.
(3) 'Small business' and 'minority or women owned business'
have the meanings given in ORS 285.503. + }
SECTION 30. { + (1) All state agencies shall adopt plans in
even numbered years, developed in consultation with the Director
of the Economic Development Department and the Advocate for
Minority, Women and Emerging Small Business to insure that small
businesses and minority or women owned businesses are given the
maximum opportunities practicable to compete directly and
meaningfully for public contracts.
(2) Each state agency plan shall include a list of the specific
measures that the agency will follow to increase the
participation of small businesses and minority or women owned
businesses in the public contracting competition process.
(3) The Advocate for Minority, Women and Emerging Small
Business shall notify the Governor if any agency fails to comply
substantially with the requirements of subsections (1) and (2) of
this section. + }
SECTION 31. ORS 200.055 is amended to read:
200.055. (1) Any disadvantaged, minority, women or emerging
small business enterprise { + or small business or minority or
women owned business that meets the criteria established by the
United States Department of Transportation, the Federal Highway
Administration and OAR 121-50-020 and 121-50-030 + } is entitled
to be certified as such upon application to the { - Oregon
Department of Administrative Services - } { + Office for
Minority, Women and Emerging Small Business + }. If the
application is approved by the { - department - }
{ + office + }, the { - department - } { + office + } shall
certify the applicant as a disadvantaged, minority, women or
emerging small business enterprise { + or a small business or
minority or women owned business + }. The enterprise shall be
considered so certified by any public contracting agency.
(2) In consultation with the { + Economic Development
Department, the + } State Board of Higher Education and the
Department of Transportation, { - and with the approval - }
{ + the Office + } { - of the Advocate - } for Minority,
Women and Emerging Small Business { - , the Oregon Department of
Administrative Services - } by rule shall adopt a uniform
standard form and procedure designed to provide complete
documentation that a business enterprise { + or business + } is
certified as a disadvantaged, minority, women or emerging small
business enterprise { + or small business or minority or women
owned business + }. The { - Oregon Department of
Administrative Services - } { + Office for Minority, Women and
Emerging Small Business + } shall compile and make available upon
request a list of certified disadvantaged, minority, women or
emerging small business enterprises { + and small businesses or
minority or women owned businesses + }.
(3) Any business enterprise that is refused certification as a
disadvantaged business enterprise or denied recertification as
such or whose certification is revoked may request an informal
review by a multimember panel appointed by the { - Director of
the Oregon Department of Administrative Services - }
{ + Advocate for Minority, Women and Emerging Small
Business + }. Appeal of the decision of the panel may be made to
the United States Department of Transportation.
(4) Any business enterprise that is refused certification as a
minority, women or emerging small business enterprise { + or as
a small business or minority or women owned business + } or has
its certification revoked may request a contested case hearing as
provided in ORS 183.310 to 183.550.
(5) The { - Oregon Department of Administrative Services - }
{ + Office for Minority, Women and Emerging Small Business + }
shall be the sole agency authorized to certify enterprises as
disadvantaged, minority, women or emerging small business
enterprises { + or small businesses or minority or women owned
businesses + } eligible to perform on public contracts in this
state.
(6) The { - Oregon Department of Administrative Services - }
{ + Office for Minority, Women and Emerging Small Business + }
by rule may establish a fee not to exceed $100 for a copy of the
list of certified disadvantaged, minority, women and emerging
small business enterprises { + or small businesses or minority
or women owned businesses + } and may assess state agencies for
services under ORS 200.005 to 200.075 and 279.059.
(7) The Department of Transportation may collect a fee, not to
exceed $200, from a bidder upon bidder prequalifications to cover
the costs of the { - Oregon Department of Administrative
Services - } { + Office for Minority, Women and Emerging Small
Business + } in administering ORS 200.005 to 200.075 and 279.059.
The Department of Transportation shall transfer such fees to the
credit of the account established under subsection (8) of this
section.
(8) The { - Oregon Department of Administrative Services - }
{ + Office for Minority, Women and Emerging Small Business + }
shall establish a special account in which to deposit fees and
assessments. The special account is continuously appropriated to
the { - Oregon Department of Administrative Services - }
{ + Office for Minority, Women and Emerging Small Business + }
to meet its expenses in administering ORS 200.005 to 200.075 and
279.059.
{ + (9) As used in this section, 'small business' and '
minority or women owned business' have the meanings given in ORS
285.503. + }
SECTION 32. ORS 200.065 is amended to read:
200.065. (1) It shall be unlawful for any person fraudulently
to obtain or retain or attempt to obtain or retain or to aid
another person fraudulently to obtain or retain or attempt to
obtain or retain certification as a disadvantaged, minority,
women or emerging small business enterprise { + or as a small
business or minority or women owned business + }.
(2) It shall be unlawful knowingly to make a false claim that
any person is qualified for certification or is certified under
ORS 200.055 for the purpose of gaining a contract or subcontract
or other benefit.
(3) The public contracting agency may withhold payment, suspend
or terminate the contract and may impose on any person a civil
penalty not to exceed 10 percent of the contract or subcontract
price or $5,000, whichever is less, for each violation of
subsection (1) or (2) of this section. The penalty shall be paid
to the office of the Advocate for Minority, Women and Emerging
Small Business.
(4) The Executive Department or an affected public contracting
agency shall investigate any complaint that a person has violated
subsection (1) or (2) of this section. In investigating such a
complaint, the Executive Department or an affected public
contracting agency may require any additional information,
administer oaths, take depositions and issue subpoenas to compel
the attendance of witnesses and the production of books, papers,
records, memoranda or other information necessary to carry out
its duties. If any person fails to comply with any subpoena
issued under this subsection or refuses to testify on any matter
on which a person may lawfully be interrogated, the procedure
provided in ORS 183.440 shall be followed to compel compliance.
(5) An affected public contracting agency or the Executive
Department may disqualify any person found to have violated
subsection (1) or (2) of this section or who admits to such
violation under oath during the course of an investigation from
bidding or participating in any public contract for a period of
time specified by the agency or department, not to exceed three
years. Any contracting agency that has notice of the finding of
the fraudulent certification may also disqualify the person from
bidding on or participating in any public contract.
{ + (6) As used in this section, 'small business' and '
minority or women owned business' have the meanings given in ORS
285.503. + }
SECTION 33. ORS 200.075 is amended to read:
200.075. (1) Any bidder or contractor or subcontractor on a
public contract that knowingly commits any of the acts listed in
paragraphs (a) to (c) of this subsection, after notice and
opportunity for hearing under ORS 279.043, shall have its right
to bid on or participate in any public contract suspended for up
to 90 days for a first violation, up to one year for a second
violation and up to five years for a third violation. Each
violation shall remain on record for five years. After five years
the violation shall no longer be considered in reviewing future
violations. The following acts are prohibited:
(a) Entering into any agreement representing that a
disadvantaged, minority, women or emerging small business
enterprise { + or a small business or minority or women owned
business that was + } certified pursuant to ORS 200.055 will be
performing work or supplying materials under the public
improvement contract without the knowledge and consent of the
disadvantaged, minority, women or emerging small business
enterprise { + or small business or minority or women owned
business + }.
(b) Exercising management and decision making control over the
internal operations of any certified disadvantaged, minority,
women or emerging small business enterprise { + or small
business or minority or women owned business + }. As used in this
paragraph, ' internal operations' does not include normal
scheduling, coordination, execution or performance as a
subcontractor on a public contract.
(c) Using a disadvantaged, minority, women or emerging small
business enterprise { + or small business or minority or women
owned business + } to perform a subcontract or supply material
under a public improvement contract to meet an established goal
or requirement when the disadvantaged, minority, women or
emerging small business enterprise { + or small business or
minority or women owned business + } does not perform a
commercially useful function in carrying out its responsibilities
and obligations under the contract.
(2) Any disadvantaged, minority, women or emerging small
business enterprise { + or small business or minority or women
owned business + } certified under ORS 200.055 that allows or
commits any of the acts listed in paragraphs (a) to (c) of this
subsection shall have its certification suspended for up to 90
days for the first violation, up to one year for a second
violation and up to five years for a third violation. Each
violation shall remain on record for five years. After five years
the violation shall no longer be considered in reviewing future
violations. The following acts are prohibited:
(a) Use of the firm's name to meet a disadvantaged, minority,
women or emerging small business enterprise { + or small
business or minority or women owned business + } goal or
requirement on a public contract when the firm does not in fact
intend to or does not actually perform the work under the
subcontract or purchase and supply material to the project under
a material supply contract.
(b) Use of any personnel of an uncertified business to operate,
manage or otherwise control the disadvantaged, minority, women or
emerging small business enterprise { + or small business or
minority or women owned business + }.
(c) Failure to perform a commercially useful function in
carrying out its functions under a subcontract or a material
supply contract entered into with a contractor or subcontractor
on a public contract when represented as a certified business to
meet an established goal or requirement.
(3) For the purpose of this section 'commercially useful
function' means the actual performance of a function or service
by the business for which there is a demand in the marketplace,
and for which the business receives payment not disproportionate
to the work performed or in conformance with industry standards.
Acting as a broker to provide for the performance of work by
others does not constitute a 'commercially useful function. '
{ + (4) As used in this section, 'small business' and '
minority or women owned business' have the meanings given in ORS
285.503. + }
SECTION 34. ORS 200.005 is amended to read:
200.005. As used in ORS 200.005 to 200.075, 200.200 and
279.059:
(1) 'Disadvantaged business enterprise' means a small business
concern which is at least 51 percent owned by one or more
socially and economically disadvantaged individuals, or, in the
case of any corporation, at least 51 percent of the stock of
which is owned by one or more socially and economically
disadvantaged individuals and whose management and daily business
operations are controlled by one or more of the socially and
economically disadvantaged individuals who own it.
(2) 'Economically disadvantaged individual' means an individual
who is socially disadvantaged and whose ability to compete in the
free enterprise system has been impaired due to diminished
capital and credit opportunities as compared to another in the
same business area who is not socially disadvantaged.
(3) 'Emerging small business' means:
(a) A business with its principal place of business located in
this state;
(b) A business with average annual gross receipts over the last
three years not exceeding $1 million for construction firms and
$300,000 for nonconstruction firms;
(c) A business which has fewer than 20 employees;
(d) An independent business; and
(e) A business properly licensed and legally registered in this
state.
(4) 'Emerging small business' does not mean a subsidiary or
parent company belonging to a group of firms which are owned and
controlled by the same individuals which have aggregate annual
gross receipts in excess of $1 million for construction or
$300,000 for nonconstruction firms over the last three years.
(5) A business may be certified as an emerging small business
for no more than seven years.
(6) 'Minority or women business enterprise' means a small
business concern which is at least 51 percent owned by one or
more minorities or women, or in the case of a corporation, at
least 51 percent of the stock of which is owned by one or more
minorities or women, and whose management and daily business
operations are controlled by one or more of such individuals.
(7) 'Minority individual' means a person who is a citizen or
lawful permanent resident of the United States { - , - }
{ + and + } who is:
(a) Black { + American, which means + } { - who is - } a
person having origins in any of the black racial groups of
Africa;
(b) Hispanic { + American, which means + } { - who is - } a
person of Mexican, Puerto Rican, Cuban, Central or South American
or other Spanish { + or Portuguese + } culture or origin,
regardless of race;
{ - (c) Asian American who is a person having origins in any
of the original peoples of the Far East, Southeast Asia, the
Indian subcontinent or the Pacific Islands; - }
{ - (d) Portuguese who is a person of Portuguese, Brazilian
or other Portuguese culture or origin, regardless of race; - }
{ - (e) American Indian or Alaskan Native who is a person
having origins in any of the original peoples of North America;
or - }
{ + (c) Asian-Pacific American, which means a person having
origins in Japan, China, Taiwan, Korea, Vietnam, Laos, Cambodia,
the Philippines, Samoa, Guam, the United States Trust Territories
of the Pacific or the Northern Marianas;
(d) Asian-Indian American, which means a person having origins
in India, Pakistan or Bangladesh;
(e) Native American, which means a person having American
Indian, Eskimo, Aleut or Native Hawaiian origins; or + }
(f) { + A + } member of another group, or another individual
who is socially and economically disadvantaged as determined by
the Advocate for Minority, Women and Emerging Small Businesses.
(8) 'Small business concern' means a small business as defined
by the United States Small Business Administration per CFR 121,
as amended.
(9) 'Socially disadvantaged individual' means an individual who
has been subjected to racial or ethnic prejudice or cultural
bias, without regard to individual qualities, because of the
individual's identity as a member of a group.
(10) 'Woman' means a person of the female sex who is a citizen
or lawful permanent resident of the United States.
(11) 'Responsible bidder' means one who, in the determination
of the office of the Advocate for Minority, Women and Emerging
Small Businesses, has undertaken both a policy and practice of
actively pursuing participation by minority and women businesses
in all bids, both public and private, submitted by such bidder.
SECTION 35. ORS 200.025 is amended to read:
200.025. (1) There is created in the Office of the Governor,
the Advocate for Minority, Women and Emerging Small Business who
shall be appointed by the Governor.
(2) There is created in the Department of Consumer and Business
Services the Office for Minority, Women and Emerging Small
Business, the employees of which shall be appointed by the
Director of the Department of Consumer and Business Services.
(3) The Advocate for Minority, Women and Emerging Small
Business shall:
(a) Advise the Governor and the director on activities and
initiatives that may promote the economic integration of
minorities, women and emerging small businesses into the business
sector;
(b) Prepare an annual report to the Governor, director and
Legislative Assembly on the status of minorities and women in the
marketplace, accomplishments and resolutions of issues of concern
to minority and women's enterprises and recommendations for
executive and legislative actions; and
(c) Carry out other duties that { + are prescribed by law or
that + } may be assigned by the Governor.
(4) The Office for Minority, Women and Emerging Small Business
shall:
(a) Provide assistance and information to minority, women and
emerging small businesses;
(b) Assist in the development and implementation of an
aggressive strategy for this state, based on research and
monitoring, that encourages participation of minorities, women
and emerging small businesses in the state's economy;
(c) Make recommendations to the director on the research,
development and implementation of the plan for the involvement of
disadvantaged and minority groups and emerging small businesses
in all state programs;
(d) Maintain an Oregon Opportunity Register and Clearinghouse
for information on public agency and other contract solicitations
for professional services, supplies and services and other bid
opportunities, in consultation with the State Board of Higher
Education, the Department of Transportation and other entities;
{ + (e) Administer ORS 200.005 to 200.075 and, in accordance
with ORS 183.310 to 183.550, adopt rules that the office
considers necessary for the administration of ORS 200.005 to
200.075; + }
{ - (e) - } { + (f) + } Monitor the certification and
compliance program for disadvantaged, minority, women and
emerging small businesses under ORS 279.059;
{ - (f) - } { + (g) + } Investigate complaints and possible
abuses of the certification program; and
{ - (g) - } { + (h) + } Assist in the promotion and
coordination of plans, programs and operations of state
government that strengthen minority and women participation in
the economic life of this state.
SECTION 36. { + Sections 5 and 7 of this Act are repealed
August 1, 2000. + }
SECTION 37. { + This Act being necessary for the immediate
preservation of the public peace, health and safety, an emergency
is declared to exist, and this Act takes effect on its
passage. + }
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