    [House Hearing, 115 Congress]
    [From the U.S. Government Publishing Office]

                              ORGANIZATIONAL MEETING

    =======================================================================

                                     HEARING

                                   BEFORE THE

                          COMMITTEE ON SMALL BUSINESS
                                 UNITED STATES
                            HOUSE OF REPRESENTATIVES

                         ONE HUNDRED FIFTEENTH CONGRESS

                                 FIRST SESSION

                                   __________

                                  HEARING HELD
                                FEBRUARY 1, 2017

                                   __________

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                Small Business Committee Document Number 115-001
                  Available via the GPO Website: www.fdsys.gov

                                  __________

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                      HOUSE COMMITTEE ON SMALL BUSINESS

                          STEVE CHABOT, Ohio, Chairman
                                STEVE KING, Iowa
                          BLAINE LUETKEMEYER, Missouri
                              DAVE BRAT, Virginia
                 AUMUA AMATA COLEMAN RADEWAGEN, American Samoa
                            STEVE KNIGHT, California
                            TRENT KELLY, Mississippi
                                 ROD BLUM, Iowa
                             JAMES COMER, Kentucky
                     JENNIFFER GONZALEZ-COLON, Puerto Rico
                              DON BACON, Nebraska
                        BRIAN FITZPATRICK, Pennsylvania
                             ROGER MARSHALL, Kansas
                                     VACANT
                   NYDIA VELAZQUEZ, New York, Ranking Member
                           DWIGHT EVANS, Pennsylvania
                           STEPHANIE MURPHY, Florida
                            AL LAWSON, JR., Florida
                             YVETTE CLARK, New York
                              JUDY CHU, California
                           ALMA ADAMS, North Carolina
                          ADRIANO ESPAILLAT, New York
                            BRAD SCHNEIDER, Illinois
                                     VACANT

                   Kevin Fitzpatrick, Majority Staff Director
          Jan Oliver, Majority Deputy Staff Director and Chief Counsel
                         Adam Minehardt, Staff Director

                                C O N T E N T S

                               OPENING STATEMENTS

                                                                       Page
    Hon. Steve Chabot................................................     1
    Hon. Nydia Velazquez.............................................     3

                                    APPENDIX

    Additional Material for the Record:
        Authorization and Oversight Plan of the Committee on Small
          Business for the One Hundred Fifteenth Congress............     8
        Rules and Procedures Adopted by the Committee on Small
          Business...................................................    15

                             ORGANIZATIONAL MEETING

                                  ----------

                          WEDNESDAY, FEBRUARY 1, 2017

                      House of Representatives,
                   Committee on Small Business,
                                                        Washington, DC.
        The Committee met, pursuant to call, at 11:04 a.m., in Room
    2360, Rayburn House Office Building, Hon. Steve Chabot
    [Chairman of the Committee] presiding.
        Present: Representatives Chabot, King, Luetkemeyer, Brat,
    Radewagen, Knight, Kelly, Blum, Comer, Gonzalez-Colon, Bacon,
    Marshall, Velazquez, Evans, Murphy, and Lawson.
        Chairman CHABOT. The Committee will come to order.
        Good morning. We want to welcome everybody here, both
    Members and those in the audience, and those tens of people at
    home that are watching this. I call the Committee on Small
    Business organizational meeting to order. We want to welcome
    all the returning and new members of the Committee.
        Before introducing the new Republican members, I would like
    to take a moment to recognize the Ranking Democratic Member,
    Congresswoman Nydia Velazquez, with whom I have served for many
    years, with one of us in the chair and the other being Ranking
    Member over a number of years, and sometimes she is in the
    chair and sometimes I am the chair, and we go back and forth.
    But hopefully, it will be this way for a while. We don't agree
    on that I am sure. But we have an excellent working
    relationship, and I know that we will continue to build on this
    Committee's strong bipartisan record of accomplishment for
    entrepreneurs.
        We are open to working with our Democratic colleagues on
    amendments to bills and anything that they think that we can
    improve the atmosphere and climate for small business in this
    country.
        There are six new Republican Members of the Committee. Rod
    Blum, now in his second term in Congress, was the CEO of a
    small software company before his election. He is fired up to
    join this Committee and put that practical experience to work,
    and we are happy to have him.
        The other five new Members are freshmen. James Comer served
    as a Kentucky State Legislator, where he had quite a reputation
    for tackling government waste. Having also run his family's
    farm in south central Kentucky, I know he has got a passion for
    rural economic development. We welcome him as well.
        Don Bacon has just started his second tour of duty, you
    might say, in public service. He recently retired from the Air
    Force as a Brigadier General. And the people of Nebraska
    decided not to let him enjoy his retirement. They sent him
    here, and we are glad they did.
        Mr. BACON. Thank you, sir.
        Chairman CHABOT. So we welcome you, Don.
        Is Brian here?
        Mr. MARSHALL. He is not.
        Chairman CHABOT. Okay. I think he got held up in another
    Committee. Well, I will say some nice things about him. You can
    all tell him I said nice things. Brian Fitzpatrick is from
    Pennsylvania. He also served our country as an FBI agent and as
    a special assistant U.S. attorney. Brian and I--well, I will go
    into the rest a little later.
        Jenniffer Gonzalez--is it Colon? Say it for me.
        Miss GONZALEZ-COLON. Gonzalez-Colon.
        Chairman CHABOT. Gonzalez-Colon. Okay. Thank you. --is from
    Puerto Rico, was one of the nation's youngest elected
    statehouse members, but she didn't stop there. Her colleagues
    valued her leadership so much that they made her Speaker of the
    House at the ripe old age of 32. I believe she has an
    incredibly bright future here in Congress, and we are honored
    she is starting out here with us. We are going to count on her
    leadership, just as the people of Puerto Rico certainly did, as
    they obviously also do with our Ranking Member, Ms. Velazquez.
        Dr. Roger Marshall joins us from the first district of
    Kansas. Dr. Marshall is well home back home, since he has
    delivered more than 5,000 babies in his career as an OB/GYN. As
    a physician, his practice is a small business. And that
    experience is going to be helpful to us as we take a closer
    look at healthcare solutions in the upcoming weeks and months.
    We welcome you here, Doctor.
        Mr. MARSHALL. Thank you.
        Chairman CHABOT. The very diverse backgrounds and
    constituencies of our freshmen Members will add to the
    experience and expertise of our returning Members in making
    sure we deliver a better way for America's small businesses.
        I would like to welcome back the members who served on the
    Committee during the 114th Congress, and many in previous
    Congresses as well. My friend and fellow Judiciary member,
    Steve King from Iowa, we are on the Judiciary Committee
    together and have served many years together, and he is a
    really good friend. Blaine Luetkemeyer from Missouri, Dave Brat
    from Virginia, Amata Radewagen from American Samoa, Steve
    Knight from California, and Trent Kelly from Mississippi, all
    returning members.
        And finally, I would like to announce the Vice Chair of the
    Committee and the Subcommittee chairs for the 115th Congress.
    We are pleased that Blaine Luetkemeyer is willing and able to
    continue serving as the Vice Chair of the Committee in the
    115th Congress. He really did a great job in the last Congress.
    He has been a hard-working, very hard-working member of this
    Committee for a long time. Very insightful in the questions
    that he has asked witnesses over the years. I had an
    opportunity to observe that. He brings a great deal to this
    Committee.
        We are also grateful to Amata Radewagen for continuing her
    work as Chair of our Subcommittee on Health and Technology. I
    am looking forward to seeing Dave Brat put his background as an
    economist to work as Chair of the Subcommittee on Economic
    Growth, Tax, and Capital Access. Steve Knight will continue his
    hard work on contracting reform that he was involved in in the
    last Congress in his new role as Chairman of the Subcommittee
    on Contracting and Workforce. Trent Kelly is bringing his years
    of experience as a District Attorney and a leader in the Army
    National Guard to his work as Chairman of the Subcommittee on
    Investigations, Oversight, and Regulations. In addition, Rod
    Blum will bring his expertise as a tech entrepreneur and
    representative of a great many Iowa farmers as Chairman of the
    Subcommittee on Agriculture, Energy, and Trade.
        And I would now like to yield to the Ranking Member, Ms.
    Velazquez, to make a statement or introduce her Members.
        Ms. VELAZQUEZ. Sure. Thank you, Mr. Chairman.
        I want to first welcome all returning and new Members on
    both sides of the aisle and take a moment to introduce the
    Democratic members of the committee. We have new Members, and
    are still waiting for some other appointments to the committee.
        First, Dwight Evans of Pennsylvania. Mr. Evans is new to
    Congress this term. He previously served in the Pennsylvania
    House of Representatives for over 35 years, where he was the
    chair of the Appropriations Committee for two decades. He also
    serves on the House Committee on Agriculture.
        Stephanie Murphy of Florida, is new to Congress. This is
    her first term. She previously worked at the U.S. Department of
    Defense, was a businesswoman and a college instructor. She also
    serves on the House Armed Services Committee.
        Mr. Al Lawson of Florida is new to Congress. He previously
    served in the Florida House of Representatives and the Florida
    Senate. He also serves on the House Committee on Agriculture.
        So I look forward to working with all of you.
        Some of the other members are at other Committee hearings.
    They will be coming in late. As soon as they make it, I will
    introduce them.
        Thank you, Mr. Chairman.
        Chairman CHABOT. Thank you very much.
        Ms. VELAZQUEZ. I yield back.
        Chairman CHABOT. Thank you.
        There are over 28 million small businesses in America.
    While the members of this Committee will inevitably have policy
    differences, all of us have a common goal: To make sure that
    our small businesses grow and create the critical jobs that
    America needs. There are numerous issues where we can find
    common ground to make government more efficient and ensure that
    the Small Business Administration carries out the will of
    Congress. I believe that the Rules Package and Authorization
    and Oversight Plan will lay the groundwork for finding those
    areas that we have in common, while maintaining the highest
    levels of bipartisan for which this Committee is known.
        And I would now like to yield to the Ranking Member for the
    purpose of making an opening statement.
        Ms. VELAZQUEZ. Thank you, Mr. Chairman.
        Small businesses continue making vital contributions to our
    economy, and we will do whatever it takes to support them. By
    the way, this may be the only committee in Congress that works
    in a bipartisan matter. And I hope that we will continue doing
    that. I always say that there is no Republican or Democratic
    approach when we deal with small businesses.
        Generating nearly two-thirds of net new jobs over the last
    15 years, small firms are the innovators and drivers of
    economic progress. Entrepreneurship also serves as the backbone
    of our nation's economy, enabling individuals to pursue their
    dreams and become financially self-sufficient.
        As we move forward, we must make sure that small businesses
    are given the resources and protections they need to prosper.
    As has been said in the past, both Republicans and Democrats
    want and need small firms to succeed and create jobs in our
    communities. I look forward to continuing this tradition during
    the 115th Congress.
        Mr. Chairman, I yield back.
        Chairman CHABOT. Thank you. The gentlelady yields back.
        I would like to thank both the Majority and Minority staffs
    for their work and cooperation in putting together the Rules
    Package that we are considering here this morning.
        There are no substantive changes from the Rules adopted in
    the last Congress, the 114th Congress. The Rules have simply
    been reordered and labeled with subheadings to make it easier
    for Members and staff to consult and follow the appropriate
    rules. In consideration of time demands of Members, we will
    continue to apply the 5-minute rule on questioning of witnesses
    to the Chair and Ranking Member. This worked well during the
    114th Congress, and I expect that we will continue to be able
    to accommodate the needs of all Members in questioning
    witnesses.
        I would now like to recognize the Ranking Member, Ms.
    Velazquez, for any remarks that she may have relative to the
    Rules Package.
        Ms. VELAZQUEZ. Thank you.
        Our committee's Rules are not only a vital institutional
    requirement, but they also set clear parameters for how we
    operate. More importantly, they contain protections ensuring
    that all points of view are considered. It is important for
    Members on both sides of the aisle to know that, in most
    regards, these rules are the rules I used when I was Chair of
    the committee, and I believe it is a testament to the
    Chairman's willingness to work in a bipartisan way.
        In this day and age, when too many try to stack the rules
    in their favor, it is refreshing that this committee does not
    have to be concerned about such distractions. A committee that
    is run openly and fairly is a committee that works and can best
    achieve its objective. It is my hope that the Rules we consider
    today will make this happen. Through their adoption, we will
    start the 115th Congress in a way that permits us to work
    across the aisle, and equally important, to solve the problems
    facing our nation's small businesses.
        With that, I yield back, Mr. Chairman.
        Chairman CHABOT. Thank you. The gentlelady yields back.
        Are there any other Members who would like to have time to
    speak relative to the rules package?
        Okay. If not, the Committee now moves to consideration of
    the rules package. The clerk will read the title of the
    document.
        The CLERK. Rules and procedures adopted by the Committee--
    --
        Chairman CHABOT. I ask unanimous consent that the rules
    package be considered as read and open for amendment in its
    entirety.
        Does any Member seek recognition for the purpose of
    offering an amendment?
        Seeing no amendments, the question is on adopting the
    rules. All those in favor, say aye.
        Any opposed, say no.
        In the opinion of the Chair, the ayes have it. The ayes
    have it. The Rules for the Small Business Committee in the
    115th Congress are adopted. The staff is authorized to make
    technical and grammatical changes.
        Today's second order of business is to consider the
    Committee's Authorization and Oversight Plan. This plan
    represents the agenda for the Committee during the 115th
    Congress. I want to thank the Ranking Member, Ms. Velazquez,
    for her input on the Authorization and Oversight plan, and her
    staff and our staff as well.
        The plan is similar to the Oversight Plan adopted in the
    114th Congress, with an emphasis on a close and thorough
    examination of all the SBA programs. In addition, this plan
    reflects the Committee's broad oversight authority under the
    Rules of the House to investigate, really, any problem
    affecting small business.
        The House Rules for the 115th Congress require each House
    Committee to include in its Authorization and Oversight Plan
    any unauthorized programs or agencies within that Committee's
    jurisdiction that have received funding in the past fiscal
    year. In the case of permanent authorizations, each Committee
    must list the programs that have not received a comprehensive
    review in the prior three Congresses.
        This Committee has been diligent about aggressive and
    bipartisan oversight of programs within its jurisdiction. In
    reviewing the SBA programs, we have found none that meet the
    tests set forward in the new House Rules. In the 115th
    Congress, we will continue the vigorous oversight that this
    Committee undertook in the 114th, including our ongoing
    examinations of the SBA 7(a) loan and the HUBZone programs. And
    we are obviously looking to our new Subcommittee Chairman, Mr.
    Kelly, for distinguishing himself in that oversight.
        At this point, I would yield to the Ranking Member, Ms.
    Velazquez, for any comments that she may have on the
    Authorization and Oversight Plan.
        Ms. VELAZQUEZ. Thank you, Mr. Chairman.
        The Oversight Plan sets forth a policy framework for our
    work this Congress. And the Chairman is to be commended on
    producing a thoughtful document. The plan calls for the robust
    oversight of the SBA and other federal small business
    initiatives, a long tradition that this committee takes
    seriously.
        In the past, we have investigated the SBA's disaster and
    contracting programs, which has yielded positive changes. These
    are but two examples of the benefits that congressional
    oversight can provide. It also identifies several programs for
    review and possible termination. In this context, the committee
    has forged a bipartisan consensus opposing the SBA continued
    creation of unauthorized pilot programs. Diverting scarce
    taxpayer dollars away from proven programs can open the door to
    fraud, waste, and abuse, something we are all working to
    minimize. On the flip side, there are statutorily authorized
    programs that need more support. One such program is the
    Women's Procurement Program, which sets aside contracts for
    women-owned small businesses. Unfortunately, it continues to
    languish and is underutilized.
        But, while the Agency finds millions annually for its pet
    projects, it neglects important programs like this. In this
    regard, I look forward to working with my colleagues to examine
    how the agency is establishing its priorities.
        The Majority also cites the need to evaluate trade
    policies. With President Trump's more protectionist view on
    trade, it is critical to understand how small businesses will
    be affected by such changes, as well as their views on the
    heightened tensions with major trading partners such as Mexico.
    U.S. businesses sold nearly $240 billion worth of products to
    Mexico in 2015, making it the second largest export market for
    American companies. Many small retailers and restaurants also
    rely on imports from Mexico. In this regard, I look forward to
    the committee's examination of how closing or reducing U.S.
    access to the Mexico market will impact America's small
    businesses.
        In addition, I am glad that the Majority has stated in
    their Oversight Plan that it will consider ways to enhance the
    utilization of the Manufacturing Extension Partnership at the
    Department of Commerce. This is especially important given that
    President Trump has stated he wants to abolish it.
        Similarly, I am also heartened with the Majority's focus on
    renewable energy, which has been a bipartisan issue for this
    committee for as long as I can remember. I am hopeful our
    committee will continue advancing policies and programs
    important to small businesses.
        Finally, regulatory burden is an important issue, and we
    must continue our work in this area. We need to understand how
    we can make the regulatory process friendlier to small
    businesses without undermining essential safeguards that many
    of these rules provide. We have heard it before, but small
    businesses need to be a priority when it comes to these issues,
    not an afterthought.
        I look forward to examining these matters this year and
    continuing to work with Chairman Chabot and the rest of the
    committee's Members on both sides of the aisle. Whether it is
    the SBA or matters of importance to small businesses, Congress
    needs a clear agenda for assisting them. It is paramount that
    we start addressing these issues quickly. By doing so, we have
    the potential to truly help create new jobs and move the
    economy forward. With that, I urge my colleagues to approve
    this Oversight Plan.
        I yield back, Mr. Chairman.
        Chairman CHABOT. Thank you. The gentlelady yields back.
        Are there any other Members who wish to be recognized for
    the purpose of making a statement on the Authorization and
    Oversight Plan?
        Okay. If not, the Committee now moves to consideration of
    the Authorization and Oversight Plan. The clerk will read the
    title of the document.
        The CLERK. Authorization and Oversight Plan----
        Chairman CHABOT. I ask unanimous consent that the
    Authorization and Oversight Plan be considered as read and open
    for amendment in its entirety.
        Does any Member seek recognition for the purpose of
    offering an amendment?
        If not, seeing no amendments, the question is on adopting
    the Authorization and Oversight Package. All those in favor,
    say aye.
        All opposed, say no.
        The ayes have it. In the opinion of the Chair, the ayes it.
    The ayes have it. The Authorization and Oversight Plan for the
    Small Business Committee in the 115th Congress is adopted. And
    Committee staff is authorized to make technical and grammatical
    changes to the Authorization and Oversight Plan.
        And Mr. Fitzpatrick is not here yet, is he? Either
    Fitzpatrick, because actually the Staff Director of this
    Committee had back surgery recently. So we appreciate your
    prayers, condolences, and hope he gets well and gets back here.
    But we have another Fitzpatrick that is in Committee. My crack
    staff had noted that he went to LaSalle University, and they
    were going to mention that I went to the real LaSalle, and that
    is LaSalle High School in Cincinnati, Ohio. Very humorous
    thing. I was going to say you are welcome to the Committee
    anyway, and that would have gone into the ether. He didn't hear
    it, but you just did. So anyway, great humor by my staff.
        I think all our business is complete. So I want to thank
    everyone for participating today, and we look forward to
    working with all of you.
        If there is no further business to come before the
    Committee, we are adjourned. Thank you very much.
        [Whereupon, at 11:25 a.m., the Committee was adjourned.]

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