II 110th CONGRESS 1st Session S. 1663 IN THE SENATE OF THE UNITED STATES June 19, 2007 Mr. Kerry (for himself and Ms. Snowe) introduced the following bill; which was read twice and referred to the Committee on Small Business and Entrepreneurship A BILL To amend the Small Business Investment Act of 1958 to reauthorize the New Markets Venture Capital Program, and for other purposes.

1.

Short title

This Act may be cited as the Securing Equity for the Economic Development of Low Income Areas Act of 2007 or the SEED Act.

2.

Definitions

In this Act— (1)the terms Administration and Administrator mean the Small Business Administration and the Administrator thereof, respectively; (2)the term low-income geographic area has the same meaning as in section 351 of the Small Business Investment Act of 1958 (15 U.S.C. 689), as amended by this Act; (3)the term New Markets Venture Capital company has the same meaning as in section 351 of the Small Business Investment Act of 1958 (15 U.S.C. 689); and (4)the term New Markets Venture Capital Program means the program under part B of title III of the Small Business Investment Act of 1958 (15 U.S.C. 689 et seq.).

3.

Diversification of New Markets Venture Capital Program

(a)

Selection of companies in each geographic region

Section 354 of the Small Business Investment Act of 1958 (15 U.S.C. 689c) is amended by adding at the end the following: (f)

Geographic requirement

In selecting companies to participate as New Markets Venture Capital companies in the program established under this part, the Administrator shall select, to the extent practicable, from among companies submitting applications under subsection (b), at least 1 company from each geographic region of the Administration. . (b)

Participation in New Markets Venture Capital Program

(1)

Administration participation required

Section 353 of the Small Business Investment Act of 1958 (15 U.S.C. 689b) is amended in the matter preceding paragraph (1), by striking under which the Administrator may and inserting under which the Administrator shall. (2)

Small manufacturer participation agreements required

Section 353 of the Small Business Investment Act of 1958 (15 U.S.C. 689b) is amended— (A)by striking In accordance with this part, and inserting the following: (a)

In general

In accordance with this part, ; (B)in subsection (a)(1), as so designated by this paragraph, by inserting after section 352 the following: (with at least 1 such agreement to be with a company engaged primarily in development of and investment in small manufacturers, to the extent practicable); and (C)by adding at the end the following: (b)

Rule of construction

Subsection (a)(1) shall not be construed to authorize the Administrator to decline to enter into a participation agreement with a company solely on the basis that the company is not engaged primarily in development of and investment in small manufacturers. .

4.

Establishment of Office of New Markets Venture Capital

Title II of the Small Business Investment Act of 1958 (15 U.S.C. 671) is amended by adding at the end the following:

202.

Office of New Markets Venture Capital

(a)

Establishment

There is established in the Investment Division of the Administration, the Office of New Markets Venture Capital. (b)

Director

The Office of New Markets Venture Capital shall be headed by a Director, who shall be a career appointee in the Senior Executive Service, as those terms are defined in section 3132 of title 5, United States Code. (c)

Responsibilities of Director

The responsibilities of the Director of the Office of New Markets Venture Capital include— (1)to administer the New Markets Venture Capital Program under part B of title III; (2)to assess, not less frequently than once every 2 years, the nature and scope of the New Markets Venture Capital Program and to advise the Administrator on recommended changes to the program, based on such assessment; (3)to work to expand the number of small business concerns participating in the New Markets Venture Capital Program; and (4)to encourage investment in small manufacturing.

.

5.

Low-income geographic areas

(a)

In general

Section 351 of the Small Business Investment Act of 1958 (15 U.S.C. 689) is amended— (1)by striking paragraphs (2) and (3) and inserting the following: (2)

Low-income geographic area

The term low-income geographic area has the meaning given the term low-income community in section 45D of the Internal Revenue Code of 1986 (relating to the new markets tax credit). ; and (2)by redesignating paragraphs (4) through (8) as paragraphs (3) through (7), respectively. (b)

Application of amended definition to capital requirement

The definition of a low-income geographic area in section 351(2) of the Small Business Investment Act of 1958, as amended by subsection (a), shall apply to private capital raised under section 354(d)(1) of the Small Business Investment Act of 1958 (15 U.S.C. 689c(d)(1)) before, on, or after the date of enactment of this Act.

6.

Limitation on time for final approval of companies

Section 354(d) of the Small Business Investment Act of 1958 (15 U.S.C. 689c(d)) is amended by striking a period of time, not to exceed 2 years, and inserting 2 years.

7.

Applications for New Markets Venture Capital Program

Not later than 60 days after the date of enactment of this Act, the Administrator shall prescribe standard documents for an application for final approval by a New Markets Venture Capital company under section 354(e) of the Small Business Investment Act of 1958 (15 U.S.C. 689c(e)). The Administrator shall ensure that such documents are designed to substantially reduce the cost burden of the application process on a company making such an application.

8.

Operational assistance grants

Section 358(a)(4)(A) of the Small Business Investment Act of 1958 (15 U.S.C. 689g(a)(4)(A)) is amended to read as follows: (A)

New markets venture capital companies

Notwithstanding section 354(d)(2), the amount of a grant made under this subsection to a New Markets Venture Capital company shall be equal to the lesser of— (i)10 percent of the private capital raised by the company; or (ii)$1,000,000. .

9.

Authorization of appropriations

Section 368(a) of the Small Business Investment Act of 1958 (15 U.S.C. 689q(a)) is amended— (1)in the matter preceding paragraph (1), by striking fiscal years 2001 through 2006 and inserting fiscal years 2007 through 2010; and (2)in paragraph (2), by striking $30,000,000 and inserting $20,000,000.