[Federal Register Volume 70, Number 225 (Wednesday, November 23, 2005)]
[Rules and Regulations]
[Pages 70703-70707]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 05-23126]
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SMALL BUSINESS ADMINISTRATION
13 CFR Part 106
RIN 3245-AF37
Cosponsorships, Fee and Non-Fee Based SBA-Sponsored Activities,
and Gifts
AGENCY: U.S. Small Business Administration.
ACTION: Final rule.
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SUMMARY: The Small Business Reauthorization and Manufacturing
Assistance Act of 2004 requires the U.S. Small Business Administration
(SBA or Agency) to promulgate regulations to carry out the Agency's
statutory authority to provide assistance for the benefit of small
business through activities sponsored with outside entities (for-profit
and not-for-profit entities and Federal, state and local government
officials or entities) as well as activities solely sponsored by SBA.
This final rule implements that authority and sets forth minimum
requirements for these activities as well as the Agency's solicitation
and acceptance of gifts.
DATES: This rule is effective on November 23, 2005.
FOR FURTHER INFORMATION CONTACT: Robert Gangwere, Deputy General
Counsel, (202) 205-6642.
SUPPLEMENTARY INFORMATION:
A. Background
On July 11, 2005, SBA published a proposed rule in the Federal
Register, 70 FR 39667, to solicit comments on its proposal to
promulgate regulations required by the Small Business Reauthorization
and Manufacturing Assistance Act of 2004 (reauthorization Act), signed
into law on December 8, 2004. Pub. L. 108-447, Division K, 118 Stat.
2809-644 (2004). The statute reauthorized SBA's cosponsorship
authority, provided SBA with authority to conduct and charge fees for
certain SBA-sponsored activities (Fee Based SBA-Sponsored Activities),
and expanded SBA's authority to use certain gift funds for marketing
and outreach activities. The statute also made significant changes to
the approval process for outreach activities and gift acceptance. With
this new authority added to its continuing authority under section
8(b)(1)(a) of the Small Business Act, the Agency has three major
vehicles by which it may provide information, training, and/or conduct
marketing and outreach for the benefit of or to small businesses:
Cosponsored Activities, Fee Based SBA-Sponsored Activities, and Non-Fee
Based SBA-Sponsored Activities.
To facilitate these activities and to implement the recent
statutory changes, SBA proposed adding part 106 to title 13 of the Code
of Federal Regulations. The proposed regulations defined each of these
vehicles and set forth the minimum requirements applicable to each. In
addition, the proposed regulations set forth minimum requirements and
the conflict of interest authority for solicitation and acceptance of
gifts under certain Agency gift authorities.
B. Discussion of Comments
These rules were published as proposed rules on July 11, 2005 in
the Federal Register, (70 FR 39667-39672). Comments were solicited in
that
[[Page 70704]]
publication and could be submitted by mail, electronic means, or hand
delivery/courier.
No comments were received by e-mail, facsimile, TDD, mail or
courier. However, in reviewing the proposed regulations, the Agency
noted a redundancy in Paragraphs (d)(1) and (d)(2) of Sections 106.302
and 106.402. In the final regulations, Paragraph (d)(1) of each of the
proposed sections, which stated, ``SBA will not unnecessarily promote a
Donor, or the Donor's products or services'' will be deleted.
Paragraphs (d)(2) and (d)(3) of each proposed Section will be
renumbered (d)(1) and (d)(2) respectively in the final regulations.
Therefore, we are publishing the final rule with these minor technical
changes.
C. Compliance With Executive Orders 13132, 12988 and 12866, the
Regulatory Flexibility Act (5 U.S.C. 601-612), and the Paperwork
Reduction Act (44 U.S.C. Ch. 35)
This regulation will not have substantial direct effects on the
States, on the relationship between the national government and the
States, or on the distribution of power and responsibilities among the
various levels of government. Therefore, for the purposes of Executive
Order 13132, SBA determines that this final rule has no federalism
implications warranting preparation of a federalism assessment.
The Office of Management and Budget (OMB) has determined that this
rule does not constitute a significant regulatory action under
Executive Order 12866.
This action meets applicable standards set forth in sections 3(a)
and 3(b)(2) of Executive Order 12988, Civil Justice Reform, to minimize
litigation, eliminate ambiguity, and reduce burden. The action does not
have retroactive or preemptive effect.
SBA has determined that this final rule does not impose additional
reporting or recordkeeping requirements under the Paperwork Reduction
Act, 44 U.S.C., Chapter 35.
The Regulatory Flexibility Act (RFA), 5 U.S.C. 601, requires
administrative agencies to consider the effect of their actions on
small entities, small non-profit enterprises, and small local
governments. Pursuant to the RFA, when an agency issues a rulemaking,
the agency must prepare a regulatory flexibility analysis which
describes the impact of the rule on small entities. However, section
605 of the RFA allows an agency to certify a rule, in lieu of preparing
an analysis, if the rulemaking is not expected to have a significant
economic impact on a substantial number of small entities. In this
case, the final regulations address the administrative requirements for
Agency management of SBA outreach programs. In other words, this final
rule will not result in the direct regulation of small entities, so no
further analysis is required by the RFA. Therefore, SBA certifies that
this rule will not have a significant economic impact on a substantial
number of small entities within the meaning of RFA.
List of Subjects in 13 CFR Part 106
Administrative practice and procedure, Authority delegations
(Government agencies), Conflict of interests, Small businesses,
Intergovernmental relations.
0
For the reasons stated in the preamble, SBA adds 13 CFR part 106, as
follows:
PART 106--COSPONSORSHIPS, FEE AND NON-FEE BASED SBA-SPONSORED
ACTIVITIES AND GIFTS
Subpart A--Scope and Definitions
Sec.
106.100 Scope.
106.101 Definitions.
Subpart B--Cosponsored Activities
106.200 Cosponsored Activity.
106.201 Who may be a Cosponsor?
106.202 What are the minimum requirements applicable to Cosponsored
Activities?
106.203 What provisions must be set forth in a Cosponsorship
Agreement?
106.204 Who has the authority to approve and sign a Cosponsorship
Agreement?
Subpart C--Fee Based SBA-Sponsored Activities
106.300 Fee Based SBA-Sponsored Activity.
106.301 What are the minimum requirements applicable to Fee Based
SBA-Sponsored Activities?
106.302 What provisions must be set forth in a Fee Based Record?
106.303 Who has the authority to approve and sign a Fee Based
Record?
Subpart D--Non-Fee Based SBA-Sponsored Activities
106.400 Non-Fee Based SBA-Sponsored Activity.
106.401 What are the minimum requirements applicable to a Non-Fee
Based SBA-Sponsored Activity?
106.402 What provisions must be set forth in a Non-Fee Based Record?
106.403 Who has the authority to approve and sign a Non-Fee Based
Record?
Subpart E--Gifts
106.500 What is SBA's Gift authority?
106.501 What minimum requirements are applicable to SBA's
solicitation and/or acceptance of Gifts?
106.502 Who has authority to perform a Gift conflict of interest
determination?
106.503 Are there types of Gifts which SBA may not solicit and/or
accept?
Authority: 15 U.S.C. 633 (g) and (h); 15 U.S.C. 637(b)(1)(A); 15
U.S.C. 637(b)(G).
Subpart A--Scope and Definitions
Sec. 106.100 Scope.
The regulations in this part apply to SBA-provided assistance for
the benefit of small business through Fee Based SBA-Sponsored
Activities or through Cosponsored Activities with Eligible Entities
authorized under section 4(h) of the Small Business Act, and to SBA
assistance provided directly to small business concerns through Non-Fee
Based SBA-Sponsored Activities authorized under section 8(b)(1)(A) of
the Small Business Act. The regulations in this part also apply to
SBA's solicitation and acceptance of Gifts under certain sections
(sections 4(g), 8(b)(1)(G), 5(b)(9) and 7(k)(2)) of the Small Business
Act (15 U.S.C. 631 et seq.), including Gifts of cash, property,
services and subsistence. Under section 4(g) of the Small Business Act,
Gifts may be solicited and accepted for marketing and outreach purposes
including the cost of promotional items and wearing apparel.
Sec. 106.101 Definitions.
The following definitions apply to this part. Defined terms are
capitalized wherever they appear.
(a) Cosponsor means an entity or individual designated in Sec.
106.201 that has signed a written Cosponsorship Agreement with SBA and
who actively and substantially participates in planning and conducting
an agreed upon Cosponsored Activity.
(b) Cosponsored Activity means an activity, event, project or
initiative, designed to provide assistance for the benefit of small
business as authorized by section 4(h) of the Small Business Act, which
has been set forth in an approved written Cosponsorship Agreement. The
Cosponsored Activity must be planned and conducted by SBA and one or
more Cosponsors. Assistance for purposes of Cosponsored Activity does
not include grant or any other form of financial assistance. A
Participant Fee may be charged by SBA or another Cosponsor at any
Cosponsored Activity.
(c) Cosponsorship Agreement means an approved written document (as
outlined in Sec. Sec. 106.203 and 106.204 which has been duly executed
by SBA and one or more Cosponsors. The Cosponsorship Agreement shall
contain the parties' respective rights, duties and responsibilities
regarding implementation of the Cosponsored Activity.
[[Page 70705]]
(d) Donor means an individual or entity that provides a Gift,
bequest or devise (in cash or in-kind) to SBA.
(e) An Eligible Entity is a potential Cosponsor. An Eligible Entity
must be a for-profit or not-for-profit entity, or a Federal, State or
local government official or entity.
(f) Fee Based SBA-Sponsored Activity Record (Fee Based Record)
means a written document, as outlined in Sec. 106.302, describing a
Fee Based SBA-Sponsored Activity and approved in writing pursuant to
Sec. 106.303.
(g) Fee Based SBA-Sponsored Activity means an activity, event,
project or initiative designed to provide assistance for the benefit of
small business, as authorized by section 4(h) of the Small Business
Act, at which SBA may charge a Participant Fee. Assistance for purposes
of Fee Based SBA-Sponsored Activity does not include grant or any other
form of financial assistance. A Fee Based SBA-Sponsored Activity must
be planned, conducted, controlled and sponsored solely by SBA.
(h) Gift (including a bequest or a device) is the voluntary
transfer to SBA of something of value without the Donor receiving legal
consideration.
(i) Non-Fee Based SBA-Sponsored Activity Record (Non-Fee Based
Record) means a written document describing a Non-Fee Based SBA-
Sponsored Activity which has been approved pursuant to Sec. 106.403.
(j) Non-Fee Based SBA-Sponsored Activity means an activity, event,
project or initiative designed to provide assistance directly to small
business concerns as authorized by section 8(b)(1)(A) of the Small
Business Act. Assistance for purposes of a Non-Fee Based SBA-Sponsored
Activity does not include grant or any other form of financial
assistance. A Non-Fee Based SBA-Sponsored Activity must be planned,
conducted, controlled and sponsored solely by SBA. No fees including
Participant Fees may be charged for a Non-Fee Based SBA-Sponsored
Activity.
(k) Participant Fee means a minimal fee assessed against a person
or entity that participates in a Cosponsored Activity or Fee Based SBA-
Sponsored Activity and is used to cover the direct costs of such
activity.
(l) Responsible Program Official is an SBA senior management
official from the originating office who is accountable for the
solicitation and/or acceptance of a Gift to the SBA; a Cosponsored
Activity; a Fee Based SBA-Sponsored Activity; or a Non-Fee Based SBA-
Sponsored Activity. If the originating office is a district or branch
office, the Responsible Program Official is the district director or
their deputy. In headquarters, the Responsible Program Official is the
management board member or their deputy with responsibility for the
relevant program area.
Subpart B--Cosponsored Activities
Sec. 106.200 Cosponsored Activity.
The Administrator (or designee), after consultation with the
General Counsel (or designee), may provide assistance for the benefit
of small business through Cosponsored Activities pursuant to section
4(h) of the Small Business Act.
Sec. 106.201 Who may be a Cosponsor?
(a) Except as specified in paragraph (b) of this section, SBA may
enter into a Cosponsorship Agreement with an Eligible Entity as defined
in Sec. 106.101(e).
(b) SBA may not enter into a Cosponsorship Agreement with an
Eligible Entity if the Administrator (or designee), after consultation
with the General Counsel (or designee), determines that such agreement
would create a conflict of interest.
Sec. 106.202 What are the minimum requirements applicable to
Cosponsored Activities?
While SBA may subject a Cosponsored Activity to additional
requirements through internal policy, procedure and the Cosponsorship
Agreement, the following requirements apply to all Cosponsored
Activities:
(a) Cosponsored Activities must be set forth in a written
Cosponsorship Agreement signed by the Administrator (or designee) and
each Cosponsor;
(b) Appropriate recognition must be given to SBA and each Cosponsor
but shall not constitute or imply an endorsement by SBA of any
Cosponsor or any Cosponsor's products or services;
(c) Any printed or electronically generated material used to
publicize or conduct the Cosponsored Activity, including any material
which has been developed, prepared or acquired by a Cosponsor, must be
approved in advance by the Responsible Program Official and must
include a prominent disclaimer stating that the Cosponsored Activity
does not constitute or imply an endorsement by SBA of any Cosponsor or
the Cosponsor's products or services;
(d) No Cosponsor shall make a profit on any Cosponsored Activity.
SBA grantees who earn program income on Cosponsored Activities must use
that program income for the Cosponsored Activity;
(e) Participant Fee(s) charged for a Cosponsored Activity may not
exceed the minimal amount needed to cover the anticipated direct costs
of the Cosponsored Activity and must be liquidated prior to other
sources of funding for the Cosponsored Activity. If SBA charges a
Participant Fee, the collection of the Participant Fees is subject to
internal SBA policies and procedures as well as applicable U.S.
Treasury rules and guidelines;
(f) SBA may not provide a Cosponsor with lists of names and
addresses of small business concerns compiled by SBA which are
otherwise protected by law or policy from disclosure; and
(g) Written approval must be obtained as outlined in Sec. 106.204.
Sec. 106.203 What provisions must be set forth in a Cosponsorship
Agreement?
While SBA may require additional provisions in the Cosponsorship
Agreement through internal policy and procedure, the following
provisions must be in all Cosponsorship Agreements:
(a) A written statement agreed to by each Cosponsor that they will
abide by all of the provisions of the Cosponsorship Agreement, the
requirements of this subpart as well the applicable definitions in
Sec. 106.100;
(b) A narrative description of the Cosponsored Activity;
(c) A listing of SBA's and each Cosponsor's rights, duties and
responsibilities with regard to the Cosponsored Activity;
(d) A proposed budget demonstrating:
(1) The type and source of financial contribution(s) (including but
not limited to cash, in-kind, Gifts, and Participant Fees) that the SBA
and each Cosponsor will make to the Cosponsored Activity; and
(2) A reasonable estimation of all anticipated expenses;
(e) A written statement that each Cosponsor agrees that they will
not make a profit on the Cosponsored Activity; and
(f) A written statement that Participant Fees, if charged, will not
exceed the minimal amount needed to cover the anticipated direct costs
of the Cosponsored Activity as outlined in the budget and will be
liquidated prior to other sources of funding for the Cosponsored
Activity.
Sec. 106.204 Who has the authority to approve and sign a
Cosponsorship Agreement?
The Administrator, or upon his/her written delegation, the Deputy
Administrator, an associate or assistant administrator, after
consultation with the General Counsel (or designee), has the authority
to approve each Cosponsored Activity and sign each
[[Page 70706]]
Cosponsorship Agreement. This authority cannot be re-delegated.
Subpart C--Fee Based SBA-Sponsored Activities
Sec. 106.300 Fee Based SBA-Sponsored Activity.
The Administrator (or designee), after consultation with the
General Counsel (or designee), may provide assistance for the benefit
of small business through Fee-Based SBA-Sponsored Activities pursuant
to section 4(h) of the Small Business Act.
Sec. 106.301 What are the minimum requirements applicable to Fee
Based SBA-Sponsored Activities?
While SBA may subject a Fee Based SBA-Sponsored Activity to
additional requirements through internal policy and procedure, the
following requirements apply to all Fee Based SBA-Sponsored Activities:
(a) A Fee Based Record must be prepared by the Responsible Program
Official in advance of the activity;
(b) Any Participant Fees charged will not exceed the minimal amount
needed to cover the anticipated direct costs of the activity;
(c) Gifts of cash accepted and the collection of Participant Fees
for Fee Based SBA-Sponsored Activities are subject to the applicable
requirements in this part, internal SBA policies and procedures as well
as applicable U.S. Treasury rules and guidelines; and
(d) Written approval must be obtained as outlined in Sec. 106.303.
Sec. 106.302 What provisions must be set forth in a Fee Based Record?
A Fee Based Record must contain the following:
(a) A narrative description of the Fee Based SBA-Sponsored
Activity;
(b) A certification by the Responsible Program Official that he or
she will abide by the requirements contained in this part, as well as
all other applicable statutes, regulations, policies and procedures for
Fee Based SBA-Sponsored Activities;
(c) A proposed budget demonstrating:
(1) All sources of funding, including annual appropriations,
Participant Fees and Gifts, to be used in support of the Fee Based SBA-
Sponsored Activity;
(2) A reasonable estimation of all anticipated expenses, which
indicates that no profit is anticipated from the Fee Based SBA-
Sponsored Activity; and
(3) A provision stating that Participant Fees, if charged, will not
exceed the minimal amount needed to cover the anticipated direct costs
of the Fee Based SBA-Sponsored Activity as outlined in the budget;
(d) With regard to any donations made in support of the Fee Based
SBA-Sponsored Activity, the Fee Based Record will reflect the
following:
(1) Each Donor may receive appropriate recognition for its Gift;
and
(2) Any printed or electronically generated material recognizing a
Donor will include a prominent disclaimer stating that the acceptance
of the Gift does not constitute or imply an endorsement by SBA of the
Donor or the Donor's products or services.
Sec. 106.303 Who has authority to approve and sign a Fee Based
Record?
The Administrator, or upon his/her written delegation, the Deputy
Administrator, an associate or assistant administrator, after
consultation with the General Counsel (or designee), has the authority
to approve and sign each Fee Based Record. This authority may not be
re-delegated.
Subpart D--Non-Fee Based SBA-Sponsored Activities
Sec. 106.400 Non-Fee Based SBA-Sponsored Activity.
The Administrator (or designee) may provide assistance directly to
small business concerns through Non-Fee Based SBA-Sponsored Activities
under section 8(b)(1)(A) of the Small Business Act.
Sec. 106.401 What are the minimum requirements applicable to a Non-
Fee Based SBA-Sponsored Activities?
While SBA may subject Non-Fee Based SBA-Sponsored Activities to
additional requirements through internal policy and procedure, the
following requirements apply to all Non-Fee Based SBA-Sponsored
Activity:
(a) A Non-Fee Based Record must be prepared and approved by the
Responsible Program Official in advance of the activity;
(b) Gifts of cash accepted for Non-Fee Based SBA-Sponsored
Activities are subject to Sec. 106.500, internal SBA policies and
procedures as well as applicable U.S. Treasury rules and guidelines;
and
(c) Written approval must be obtained as outlined in Sec. 106.403.
Sec. 106.402 What provisions must be set forth in a Non-Fee Based
Record?
A Non-Fee Based Record must contain the following:
(a) A narrative description of the Non-Fee Based SBA-Sponsored
Activity;
(b) A certification by the Responsible Program Official that he or
she will abide by the requirements contained in this part, as well as
all other applicable statutes, regulations, policies and procedures for
Non-Fee Based SBA-Sponsored Activities;
(c) If applicable, a list of Donors supporting the activity; and
(d) With regard to any donations made in support of a Non-Fee Based
SBA-Sponsored Activity, the Non-Fee Based Record will reflect the
following:
(1) Each Donor may receive appropriate recognition for its Gift;
and
(2) Any printed or electronically generated material recognizing a
Donor will include a prominent disclaimer stating that the acceptance
of the Gift does not constitute or imply an endorsement by SBA of the
Donor, or the Donor's products or services.
Sec. 106.403 Who has authority to approve and sign a Non-Fee Based
Record?
The appropriate Responsible Program Official, after consultation
with the designated legal counsel, has authority to approve and sign
each Non-Fee Based Record.
Subpart E--Gifts
Sec. 106.500 What is SBA's Gift authority?
This section covers SBA's Gift acceptance authority under sections
4(g), 8(b)(1)(G), 5(b)(9) and 7(k)(2) of the Small Business Act.
Sec. 106.501 What minimum requirements are applicable to SBA's
solicitation and/or acceptance of Gifts?
While SBA may subject the solicitation and/or acceptance of Gifts
to additional requirements through internal policy and procedure, the
following requirements must apply to all Gift solicitations and/or
acceptances under the authority of the Small Business Act sections
cited in Sec. 106.500:
(a) SBA is required to use the Gift (whether cash or in-kind) in a
manner consistent with the original purpose of the Gift;
(b) There must be written documentation of each Gift solicitation
and/or acceptance signed by an authorized SBA official;
(c) Any Gift solicited and/or accepted must undergo a
determination, prior to solicitation of the Gift or prior to acceptance
of the Gift if unsolicited, of whether a conflict of interest exists
between the Donor and SBA; and
(d) All cash Gifts donated to SBA under the authority cited in
Sec. 106.500 must be deposited in an SBA trust account at the U.S.
Department of the Treasury.
Sec. 106.502 Who has authority to perform a Gift conflict of interest
determination?
(a) For Gifts solicited and/or accepted under sections 4(g),
8(b)(1)(G), and
[[Page 70707]]
7(k)(2) of the Small Business Act, the General Counsel, or designee,
must make the final conflict of interest determination. No Gift shall
be solicited and/or accepted under these sections of the Small Business
Act if such solicitation and/or acceptance would, in the determination
of the General Counsel (or designee), create a conflict of interest.
(b) For Gifts of services and facilities solicited and/or accepted
under section 5(b)(9), the conflict of interest determination may be
made by designated disaster legal counsel.
Sec. 106.503 Are there types of Gifts which SBA may not solicit and/
or accept?
Yes. SBA shall not solicit and/or accept Gifts of or for (or use
cash Gifts to purchase or engage in) the following:
(a) Alcohol products;
(b) Tobacco products;
(c) Pornographic or sexually explicit objects or services;
(d) Gambling (including raffles and lotteries);
(e) Parties primarily for the benefit of Government employees; and
(f) Any other product or service prohibited by law or policy.
Dated: November 16, 2005.
Hector V. Barreto,
Administrator.
[FR Doc. 05-23126 Filed 11-22-05; 8:45 am]
BILLING CODE 8025-01-P