The Secretary, through the Director and, if appropriate, through other officials, shall provide assistance for the creation and support of regional centers for the transfer of manufacturing technology (hereafter in this chapter referred to as the "Centers"). Such centers 1 shall be affiliated with any United States-based nonprofit institution or organization, or group thereof, that applies for and is awarded financial assistance under this section in accordance with the description published by the Secretary in the Federal Register under subsection (c)(2) of this section. Individual awards shall be decided on the basis of merit review. The objective of the Centers is to enhance productivity and technological performance in United States manufacturing through—
(1) the transfer of manufacturing technology and techniques developed at the Institute to Centers and, through them, to manufacturing companies throughout the United States;
(2) the participation of individuals from industry, universities, State governments, other Federal agencies, and, when appropriate, the Institute in cooperative technology transfer activities;
(3) efforts to make new manufacturing technology and processes usable by United States-based small- and medium-sized companies;
(4) the active dissemination of scientific, engineering, technical, and management information about manufacturing to industrial firms, including small- and medium-sized manufacturing companies;
(5) the utilization, when appropriate, of the expertise and capability that exists in Federal laboratories other than the Institute; and
(6) providing to community colleges information about the job skills needed in small- and medium-sized manufacturing businesses in the regions they serve.
The activities of the Centers shall include—
(1) the establishment of automated manufacturing systems and other advanced production technologies, based on research by the Institute, for the purpose of demonstrations and technology transfer;
(2) the active transfer and dissemination of research findings and Center expertise to a wide range of companies and enterprises, particularly small- and medium-sized manufacturers; and
(3) loans, on a selective, short-term basis, of items of advanced manufacturing equipment to small manufacturing firms with less than 100 employees.
(1) The Secretary may provide financial support to any Center created under subsection (a) of this section for a period not to exceed six years. The Secretary may not provide to a Center more than 50 percent of the capital and annual operating and maintenance funds required to create and maintain such Center.
(2) The Secretary shall publish in the Federal Register, within 90 days after August 23, 1988, a draft description of a program for establishing Centers, including—
(A) a description of the program;
(B) procedures to be followed by applicants;
(C) criteria for determining qualified applicants;
(D) criteria, including those listed under paragraph (4), for choosing recipients of financial assistance under this section from among the qualified applicants; and
(E) maximum support levels expected to be available to Centers under the program in the fourth through sixth years of assistance under this section.
The Secretary shall publish a final description under this paragraph after the expiration of a 30-day comment period.
(3)(A) Any nonprofit institution, or group thereof, or consortia of nonprofit institutions, including entities existing on August 23, 1988, may submit to the Secretary an application for financial support under this subsection, in accordance with the procedures established by the Secretary and published in the Federal Register under paragraph (2).
(B) In order to receive assistance under this section, an applicant for financial assistance under subparagraph (A) shall provide adequate assurances that non-Federal assets obtained from the applicant and the applicant's partnering organizations will be used as a funding source to meet not less than 50 percent of the costs incurred for the first 3 years and an increasing share for each of the last 3 years. For purposes of the preceding sentence, the costs incurred means the costs incurred in connection with the activities undertaken to improve the management, productivity, and technological performance of small- and medium-sized manufacturing companies.
(C) In meeting the 50 percent requirement, it is anticipated that a Center will enter into agreements with other entities such as private industry, universities, and State governments to accomplish programmatic objectives and access new and existing resources that will further the impact of the Federal investment made on behalf of small- and medium-sized manufacturing companies. All non-Federal costs,2 contributed by such entities and determined by a Center as programmatically reasonable and allocable under MEP program procedures are includable as a portion of the Center's contribution.
(D) Each applicant under subparagraph (A) shall also submit a proposal for the allocation of the legal rights associated with any invention which may result from the proposed Center's activities.
(4) The Secretary shall subject each such application to merit review. In making a decision whether to approve such application and provide financial support under this subsection, the Secretary shall consider at a minimum (A) the merits of the application, particularly those portions of the application regarding technology transfer, training and education, and adaptation of manufacturing technologies to the needs of particular industrial sectors, (B) the quality of service to be provided, (C) geographical diversity and extent of service area, and (D) the percentage of funding and amount of in-kind commitment from other sources.
(5) Each Center which receives financial assistance under this section shall be evaluated during its third year of operation by an evaluation panel appointed by the Secretary. Each such evaluation panel shall be composed of private experts, none of whom shall be connected with the involved Center, and Federal officials. An official of the Institute shall chair the panel. Each evaluation panel shall measure the involved Center's performance against the objectives specified in this section. The Secretary shall not provide funding for the fourth through the sixth years of such Center's operation unless the evaluation is positive. If the evaluation is positive, the Secretary may provide continued funding through the sixth year at declining levels. A Center that has not received a positive evaluation by the evaluation panel shall be notified by the panel of the deficiencies in its performance and shall be placed on probation for one year, after which time the panel shall reevaluate the Center. If the Center has not addressed the deficiencies identified by the panel, or shown a significant improvement in its performance, the Director shall conduct a new competition to select an operator for the Center or may close the Center. After the sixth year, a Center may receive additional financial support under this section if it has received a positive evaluation through an independent review, under procedures established by the Institute. Such an independent review shall be required at least every two years after the sixth year of operation. Funding received for a fiscal year under this section after the sixth year of operation shall not exceed one third of the capital and annual operating and maintenance costs of the Center under the program.
(6) The provisions of chapter 18 of title 35 shall (to the extent not inconsistent with this section) apply to the promotion of technology from research by Centers under this section except for contracts for such specific technology extension or transfer services as may be specified by statute or by the Director.
(7) Not later than 90 days after January 4, 2011, the Comptroller General shall submit to Congress a report on the cost share requirements under the program. The report shall—
(A) discuss various cost share structures, including the cost share structure in place prior to such date, and the effect of such cost share structures on individual Centers and the overall program; and
(B) include recommendations for how best to structure the cost share requirement to provide for the long-term sustainability of the program.
(8) If consistent with the recommendations in the report transmitted to Congress under paragraph (7), the Secretary shall alter the cost structure requirements specified under paragraph (3)(B) and (5) provided that the modification does not increase the cost share structure in place before January 4, 2011, or allow the Secretary to provide a Center more than 50 percent of the costs incurred by that Center.
In addition to such sums as may be appropriated to the Secretary and Director to operate the Centers program, the Secretary and Director also may accept funds from other Federal departments and agencies and under section 272(c)(7) of this title from the private sector for the purpose of strengthening United States manufacturing.
The Director shall determine whether funds accepted from other Federal departments or agencies shall be counted in the calculation of the Federal share of capital and annual operating and maintenance costs under subsection (c).
Funds accepted from the private sector under section 272(c)(7) of this title, if allocated to a Center, shall not be considered in the calculation of the Federal share under subsection (c) of this section.
There is established within the Institute a Manufacturing Extension Partnership Advisory Board (in this subsection referred to as the "MEP Advisory Board").
The MEP Advisory Board shall consist of 10 members broadly representative of stakeholders, to be appointed by the Director. At least 2 members shall be employed by or on an advisory board for the Centers, and at least 5 other members shall be from United States small businesses in the manufacturing sector. No member shall be an employee of the Federal Government.
Except as provided in subparagraph (C) or (D), the term of office of each member of the MEP Advisory Board shall be 3 years.
The original members of the MEP Advisory Board shall be appointed to 3 classes. One class of 3 members shall have an initial term of 1 year, one class of 3 members shall have an initial term of 2 years, and one class of 4 members shall have an initial term of 3 years.
Any member appointed to fill a vacancy occurring prior to the expiration of the term for which his predecessor was appointed shall be appointed for the remainder of such term.
Any person who has completed two consecutive full terms of service on the MEP Advisory Board shall thereafter be ineligible for appointment during the one-year period following the expiration of the second such term.
The MEP Advisory Board shall meet not less than 2 times annually, and provide to the Director—
(A) advice on Manufacturing Extension Partnership programs, plans, and policies;
(B) assessments of the soundness of Manufacturing Extension Partnership plans and strategies; and
(C) assessments of current performance against Manufacturing Extension Partnership program plans.
In discharging its duties under this subsection, the MEP Advisory Board shall function solely in an advisory capacity, in accordance with the Federal Advisory Committee Act.
Section 14 of the Federal Advisory Committee Act shall not apply to the MEP Advisory Board.
The MEP Advisory Board shall transmit an annual report to the Secretary for transmittal to Congress within 30 days after the submission to Congress of the President's annual budget request in each year. Such report shall address the status of the program established pursuant to this section and comment on the relevant sections of the programmatic planning document and updates thereto transmitted to Congress by the Director under subsections (c) and (d) of section 278i of this title.
The Director shall establish, within the Centers program under this section and section 278l of this title, a program of competitive awards among participants described in paragraph (2) for the purposes described in paragraph (3).
Participants receiving awards under this subsection shall be the Centers, or a consortium of such Centers.
The purpose of the program under this subsection is to add capabilities to the MEP program, including the development of projects to solve new or emerging manufacturing problems as determined by the Director, in consultation with the Director of the Hollings MEP program, the Manufacturing Extension Partnership Advisory Board, and small and medium-sized manufacturers. One or more themes for the competition may be identified, which may vary from year to year, depending on the needs of manufacturers and the success of previous competitions. Centers may be reimbursed for costs incurred under the program. These themes—
(A) shall be related to projects designed to increase the viability both of traditional manufacturing sectors and other sectors, such as construction, that increasingly rely on manufacturing through the use of manufactured components and manufacturing techniques, including supply chain integration and quality management;
(B) shall be related to projects related to the transfer of technology based on the technological needs of manufacturers and available technologies from institutions of higher education, laboratories, and other technology producing entities; and
(C) may extend beyond these traditional areas to include projects related to construction industry modernization.
Applications for awards under this subsection shall be submitted in such manner, at such time, and containing such information as the Director shall require, in consultation with the Manufacturing Extension Partnership Advisory Board.
Awards under this section shall be peer reviewed and competitively awarded. The Director shall endeavor to select at least one proposal in each of the 9 statistical divisions of the United States (as designated by the Bureau of the Census). The Director shall select proposals to receive awards that will—
(i) create jobs or train newly hired employees;
(ii) promote technology transfer and commercialization of environmentally focused materials, products, and processes;
(iii) increase energy efficiency; and
(iv) improve the competitiveness of industries in the region in which the Center or Centers are located.
The Director may select proposals to receive awards that will—
(i) encourage greater cooperation and foster partnerships in the region with similar Federal, State, and locally funded programs to encourage energy efficiency and building technology; and
(ii) collect data and analyze the increasing connection between manufactured products and manufacturing techniques, the future of construction practices, and the emerging application of products from the green energy industries.
Recipients of awards under this subsection shall not be required to provide a matching contribution.
In making awards under this subsection, the Director, in consultation with the Manufacturing Extension Partnership Advisory Board and the Secretary of Commerce, may—
(A) take into consideration whether an application has significant potential for enhancing the competitiveness of small and medium-sized United States manufacturers in the global marketplace; and
(B) give a preference to applications for such projects to the extent the Director deems appropriate, taking into account the broader purposes of this subsection.
Awards under this section shall last no longer than 3 years.
In addition to manufacturing firms eligible to participate in the Centers program, awards under this subsection may be used by the Centers to assist small- or medium-sized construction firms. Centers may be reimbursed under the program for working with such eligible participants.
In addition to any amounts otherwise authorized or appropriated to carry out this section, there are authorized to be appropriated to the Secretary of Commerce $7,000,000 for each of the fiscal years 2011 through 2013 to carry out this subsection.
The Director shall establish, within the Centers program under this section, an innovative services initiative to assist small- and medium-sized manufacturers in—
(A) reducing their energy usage, greenhouse gas emissions, and environmental waste to improve profitability;
(B) accelerating the domestic commercialization of new product technologies, including components for renewable energy and energy efficiency systems; and
(C) identification of and diversification to new markets, including support for transitioning to the production of components for renewable energy and energy efficiency systems.
The Director may not undertake any activity to accelerate the domestic commercialization of a new product technology under this subsection unless an analysis of market demand for the new product technology has been conducted.
In submitting the 3-year programmatic planning document and annual updates under section 278i of this title, the Director shall include an assessment of the Director's governance of the program established under this section.
In conducting the assessment, the Director shall use the criteria established pursuant to the Malcolm Baldrige National Quality Award under section 3711a(d)(1)(C) of this title.
The program under this section shall be known as the "Hollings Manufacturing Extension Partnership".
The Regional Centers for the Transfer of Manufacturing Technology created and supported under subsection (a) shall be known as the "Hollings Manufacturing Extension Centers" (in this chapter referred to as the "Centers").
In this section, the term "community college" means an institution of higher education (as defined under section 1001(a) of title 20) at which the highest degree that is predominately awarded to students is an associate's degree.
The Director shall—
(1) evaluate obstacles that are unique to small manufacturers that prevent such manufacturers from effectively competing in the global market;
(2) implement a comprehensive plan to train the Centers to address such obstacles; and
(3) facilitate improved communication between the Centers to assist such manufacturers in implementing appropriate, targeted solutions to such obstacles.
(Mar. 3, 1901, ch. 872, §25, as added Pub. L. 100–418, title V, §5121(a), Aug. 23, 1988, 102 Stat. 1433; amended Pub. L. 102–245, title I, §105(e), Feb. 14, 1992, 106 Stat. 12; Pub. L. 105–309, §2, Oct. 30, 1998, 112 Stat. 2935; Pub. L. 110–69, title III, §3003, Aug. 9, 2007, 121 Stat. 587; Pub. L. 111–240, title IV, §4226(a), Sept. 27, 2010, 124 Stat. 2598; Pub. L. 111–358, title IV, §404(a)–(f)(1), (3), (h), (i), title VII, §703, Jan. 4, 2011, 124 Stat. 4001–4003, 4042.)
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