[House Hearing, 116 Congress]
[From the U.S. Government Publishing Office]


  MARKUP OF H.R. 3537, VETERAN ENTREPRENEURSHIP TRAINING ACT OF 2019; 
H.R. 3734, SUCCESSFUL ENTREPRENEURSHIP FOR RESERVISTS AND VETERANS ACT; 
 H.R. 3661, PATRIOTIC EMPLOYER PROTECTION ACT; H.R. 1615, VERIFICATION 
 ALIGNMENT AND SERVICE-DISABLED BUSINESS ADJUSTMENT ACT; AND H.R. 499, 
       SERVICE-DISABLED VETERANS SMALL BUSINESS CONTINUATION ACT

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                                HEARING

                               BEFORE THE

                      COMMITTEE ON SMALL BUSINESS
                             UNITED STATES
                        HOUSE OF REPRESENTATIVES

                     ONE HUNDRED SIXTEENTH CONGRESS

                             FIRST SESSION

                               __________

                              HEARING HELD
                             JULY 17, 2019

                               __________

[GRAPHIC NOT AVAILABLE IN TIFF FORMAT]                               

            Small Business Committee Document Number 116-035
             Available via the GPO Website: www.govinfo.gov
             
                               __________
                               

                    U.S. GOVERNMENT PUBLISHING OFFICE                    
38-187                      WASHINGTON : 2019                     
          
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                   HOUSE COMMITTEE ON SMALL BUSINESS

                 NYDIA VELAZQUEZ, New York, Chairwoman
                         ABBY FINKENAUER, Iowa
                          JARED GOLDEN, Maine
                          ANDY KIM, New Jersey
                          JASON CROW, Colorado
                         SHARICE DAVIDS, Kansas
                          JUDY CHU, California
                           MARC VEASEY, Texas
                       DWIGHT EVANS, Pennsylvania
                        BRAD SCHNEIDER, Illinois
                      ADRIANO ESPAILLAT, New York
                       ANTONIO DELGADO, New York
                     CHRISSY HOULAHAN, Pennsylvania
                         ANGIE CRAIG, Minnesota
                   STEVE CHABOT, Ohio, Ranking Member
   AUMUA AMATA COLEMAN RADEWAGEN, American Samoa, Vice Ranking Member
                        TRENT KELLY, Mississippi
                          TROY BALDERSON, Ohio
                          KEVIN HERN, Oklahoma
                        JIM HAGEDORN, Minnesota
                        PETE STAUBER, Minnesota
                        TIM BURCHETT, Tennessee
                          ROSS SPANO, Florida
                        JOHN JOYCE, Pennsylvania

                Adam Minehardt, Majority Staff Director
     Melissa Jung, Majority Deputy Staff Director and Chief Counsel
                   Kevin Fitzpatrick, Staff Director
                            
                            
                            C O N T E N T S

                           OPENING STATEMENTS

Hon. Nydia Velazquez.............................................     1
Hon. Steve Chabot................................................     2

                                APPENDIX

Additional Material for the Record:
    H.R. 3537, Veteran Entrepreneurship Training Act of 2019.....    17
    H.R. 3734, Successful Entrepreneurship for Reservists and 
      Veterans Act...............................................    26
    H.R. 3661, Patriotic Employer Protection Act.................    31
    H.R. 1615, Verification Alignment and Service-Disabled 
      Business Adjustment Act....................................    36
    H.R. 499, Service-Disabled Veterans Small Business 
      Continuation Act...........................................    56

 
  MARKUP OF H.R. 3537, VETERAN ENTREPRENEURSHIP TRAINING ACT OF 2019; 
H.R. 3734, SUCCESSFUL ENTREPRENEURSHIP FOR RESERVISTS AND VETERANS ACT; 
 H.R. 3661, PATRIOTIC EMPLOYER PROTECTION ACT; H.R. 1615, VERIFICATION 
 ALIGNMENT AND SERVICE-DISABLED BUSINESS ADJUSTMENT ACT; AND H.R. 499, 
       SERVICE-DISABLED VETERANS SMALL BUSINESS CONTINUATION ACT

                              ----------                              


                        WEDNESDAY, JULY 17, 2019

                  House of Representatives,
               Committee on Small Business,
                                                    Washington, DC.
    The Committee met, pursuant to call, at 11:36 a.m., in Room 
2360, Rayburn House Office Building, Hon. Nydia M. Velazquez 
[chairwoman of the Committee] presiding.
    Present: Representatives Velazquez, Finkenauer, Golden, 
Kim, Crow, Davids, Chu, Evans, Schneider, Espaillat, Delgado, 
Houlahan, Craig, Chabot, Kelly, Balderson, Hern, Hagedorn, 
Stauber, Burchett, and Spano.
    Chairwoman VELAZQUEZ. Good morning. The Committee will 
please come to order.
    A quorum being present, this morning's meeting of the 
Committee on Small Business will come to order. Without 
objection, the Chair is authorized to declare a recess at any 
time.
    In our second legislative markup of the 116th Congress, we 
will, once again, be working on behalf of veteran entrepreneurs 
who have already made great sacrifices for our country. Many 
have spent time away from their families and put themselves in 
harm's way to protect American principles. Unsurprisingly, it 
is this very dedication and determination that makes them the 
ideal business owner. Due to their leadership, perseverance, 
training, and other skills acquired in the military, veterans 
are often uniquely qualified to launch and manage their own 
businesses. Yet despite this rich tradition, the share of new 
veteran entrepreneurs has declined steadily from about 12.5 
percent in 1996 to slightly over 4 percent in 2016.
    As we heard in our hearings just last week, veterans face 
obstacles, like finding affordable access to capital, 
identifying and locating entrepreneurial development resources, 
and navigating the contracting process. For that reason, I am 
committed to reviewing the Small Business Administration's 
veteran-focused programs, like the Veteran's Business Outreach 
Centers and the Boots to Business program, to ensure they are 
effectively serving, aspiring, and existing veteran business 
owners.
    But that is only one piece of the puzzle. As the largest 
purchaser of goods and services in the world, the Federal 
Government is in a unique position to support veteran-owned 
businesses. Coordinating certifications between the SBA and VA 
can allow the Federal Government to reap the benefits of goods 
and services provided by veteran-owned businesses. And we know 
that service comes in many forms, as a spouse of a 
servicemember or as part of our military reserve force. These 
individuals deserve our support as well.
    Whether it is entrepreneurial development, contracting, or 
access to capital, we need to be asking ourselves if these 
programs are working effectively. Can we make improvements to 
them? Should Congress consider expanding the reach?
    We owe it to the veterans and their families, those who 
have sacrificed so much in service to our country, to do 
everything we can to create new pathways to empower veterans 
and military families who want to start or grow their business.
    With approximately 2.5 million veteran-owned businesses 
generating over $1 trillion in receipts, it is clear for many 
men and women leaving the service, entrepreneurship provides a 
promising opportunity to continue serving their country, 
creating jobs in the local communities, while supporting their 
families.
    As a result of hearings and outreach, the Committee today 
is considering five bills: H.R. 3537, the ``Veteran 
Entrepreneurship Training Act of 2019'', introduced by Mr. 
Schneider and cosponsored by Mr. Spano; H.R. 3734, the 
``Successful Entrepreneurship for Reservists and Veterans 
Act'', introduced by Ms. Davids and cosponsored by Ranking 
Member Chabot; H.R. 3661, the ``Patriotic Employer Protection 
Act'', introduced by Mr. Kim and cosponsored by Mr. Burchett; 
H.R. 1615, the ``Verification Alignment and Service-Disabled 
Business Adjustment Act'', introduced by Mr. Kelly and 
cosponsored by Mr. Crow; H.R. 499, the ``Service-Disabled 
Veterans Small Business Continuation Act'', introduced by Mr. 
Chabot and cosponsored by Mr. Delgado.
    As we have done many times in the past, the bills today are 
brought before us in a bipartisan fashion, and I support each 
of the bills to be marked up today.
    However, before we get to the substance of the bills, I 
want to thank the Ranking Member and his staff for 
collaborating on this package. I would also like to thank all 
of our members, both Republican and Democrat, for their efforts 
to improve the landscape for veteran entrepreneurs.
    I would now recognize to recognize our Ranking Member, Mr. 
Chabot, for his opening remarks.
    Mr. CHABOT. Thank you, Madam Chairwoman. And I want to 
thank you again for running our Committee in such a bipartisan 
fashion.
    Earlier this week, our Committee's package of five 
bipartisan bills passed the House via a voice vote. And today, 
we have yet another strong package of five bills that are fully 
bipartisan as well. So, again, thank you for making sure that 
we all on this Committee have a seat at the table.
    Today's five bills focus on our Nation's heroes, our 
veterans, service-disabled veterans, reservists, National Guard 
members, and their spouses. Just last week, four veterans 
testified before our Committee and reminded us of the 
incredible contributions those who have served make to our 
country. They have made extraordinary sacrifices, put their 
lives on the line, and kept our country safe. Their service to 
our Nation doesn't always stop when they separate from the 
military. Increasingly, veterans are choosing to open their own 
small businesses.
    Research has shown that servicemembers are especially 
qualified to start and run their own firms. While serving in 
the military, they learn to make good decisions in chaotic 
environments and are confident, driven, and natural leaders. 
There are a myriad of programs and services across the Federal 
Government that assist veterans who start businesses after 
leaving the military.
    The package of bills, which we will discuss in greater 
detail as they come up, will go a long way in making these 
programs and services more accessible to our Nation's veteran 
entrepreneurs.
    So, again, thank you, Chairwoman, and each of the members 
on both sides of the aisle who have taken leadership roles in 
sponsoring or cosponsoring these bills. And I yield back.
    Chairwoman VELAZQUEZ. Thank you very much. The gentleman 
yields back.
    Before we get into the individual bills, are there any 
members who seek recognition for the purposes of making an 
opening statement?
    Okay. Seeing none, we will move to consideration of H.R. 
3537, the ``Veteran Entrepreneurship Training Act of 2019'', 
introduced by Mr. Schneider and cosponsored by Mr. Spano, which 
modernizes and codifies the Boots to Business program.
    I would now like to recognize the bill sponsor, the 
gentleman from Illinois, Mr. Schneider, for an opening 
statement.
    Mr. SCHNEIDER. Thank you, Madam Chair.
    I want to thank the Committee for its consideration today 
of this legislation, the ``Veteran Entrepreneurship Training 
Act'', which I introduced with my colleague from Florida, Mr. 
Spano.
    Transitioning servicemembers deserve our support as they 
move from military to civilian life. Last week, we heard from 
several veterans, some of whom benefited from the Boots to 
Business program and all of whom stated their support for that 
program. That is because we know that servicemembers make 
excellent entrepreneurs. They have the temperament, the drive, 
and the experience to excel at running their own businesses.
    But as their testimony highlighted, these individuals often 
lack the industry-specific skills from knowledge of financing 
options to background and market research to make their 
business or their business dreams a reality.
    The Boots to Business program has helped more than 50,000 
servicemembers and veterans bridge this gap by providing a 2-
day in-person course on business ownership, followed by more 
in-depth instruction through an 8-week online course. This 
program has helped to empower servicemembers to put their dream 
of running their own business into a reality, and yet the 
program lacks statutory authorization.
    Our legislation would codify the program into law for the 
next 5 years to ensure future servicemembers are able to seize 
the opportunity to learn how to launch their own small 
businesses. I am pleased that a version of this legislation was 
included as an amendment of the National Defense Authorization 
Act.
    However, there is no guarantee the amendment will survive 
the conference committee. Passing a standalone bill as we are 
working towards today remains important to ensure that the 
Boots to Business program is protected and continues to serve 
our veterans. I urge my colleagues to join in support of the 
Boots to Business program by voting in favor of this bipartisan 
bill.
    Again, thank you to the Committee staff who helped draft 
the legislation. And thank you to my colleague Mr. Spano for 
joining me in supporting this important program.
    I yield back.
    Chairwoman VELAZQUEZ. The gentleman yields back.
    Are there any other members who wish to be recognized for 
their statement?
    The gentleman, Mr. Spano, cosponsor of the bill, is 
recognized for 5 minutes.
    Mr. SPANO. Thank you, Chair.
    And a heartfelt thank you to you, Chair, and also the 
Ranking Member for consideration of this package of bills which 
I think is very, very important. Thank you to Representative 
Schneider for allowing me to be a sponsor with you on the bill.
    In Florida, the 15th Congressional District that I 
represent, which is situated just east of Tampa, we have the 
largest number of veterans in any congressional district in the 
State of Florida. So these issues and these bills are 
particularly important to me. So thank you again for the 
consideration, and thank you for working together to present 
them today.
    The bill authorizes the Boots to Business, as 
Representative Schneider just mentioned, program for 5 
additional years and ensures that our veterans and their 
families receive the essential education that they need on how 
to start and successfully run their own small businesses. 
Specifically, the program aims to provide in-depth training on 
business ownership, how to draft a business plan, identify 
sources of capital to start their business, and then how to 
connect with local SBA resources.
    In the same way that we give our troops the support that 
they need and the tools that they need for active service, we 
must also prepare our veterans for civilian life. And this 
program does just that. It has received glowing support from 
the SBA, and many of the veterans that have previously appeared 
before the Committee, as Representative Schneider just 
mentioned a moment ago. And so I urge my colleagues on the 
Committee to support this very, very important bill and give 
our veterans the training and support that they so richly 
deserve.
    Thank you so much. I yield back, Chair.
    Chairwoman VELAZQUEZ. The gentleman yields back.
    Are there any other members who wish to be recognized for a 
statement on H.R. 3537?
    Go first. Yeah.
    Mr. CHABOT. Thank you.
    Chairwoman VELAZQUEZ. The gentleman is recognized for 5 
minutes.
    Mr. CHABOT. Thank you, Madam Chairwoman.
    The Boots to Business program is a 2-day in-person 
entrepreneurship program initiated and offered by the SBA as 
part of the Department of Defense's Transition Assistance 
Program. Originally launched back in 2012, the Boots to 
Business program offers transitioning servicemembers and 
spouses information about self-employment and business 
ownership.
    The Veterans Business Outreach Centers deliver these 
services at over 180 military installations nationwide. Just 
last week, as was mentioned, at our legislative hearing, we 
heard firsthand from veteran-owned small business owners how 
important it is for separating servicemembers to be made aware 
early of the training opportunities available to them. The 
Boots to Business program does just that. The program is 
designed to impart the essential information to take a business 
from concept to execution and facilitate the road to 
entrepreneurship for our Nation's veterans.
    I commend the gentleman from Illinois, Mr. Schneider, and 
the gentleman from Florida, Mr. Spano, for their leadership on 
this bill and for working hard to increase business 
opportunities for our Nation's heroes. I urge my colleagues to 
support the bill, and I yield back.
    Chairwoman VELAZQUEZ. The gentleman yields back.
    And I yield to myself just to congratulate both gentlemen, 
Mr. Schneider and Mr. Spano, for their hard work on this issue. 
It is important that we provide certainty to this program, and 
that is exactly what this bill does by codifying the program 
for 5 years. So I urge my colleagues to support this 
commonsense legislation.
    If there is no further discussion, the Committee will move 
to consideration of H.R. 3537.
    The clerk will report the title of the bill.
    The CLERK. H.R. 3537, the ``Veteran Entrepreneurship 
Training Act''----
    Chairwoman VELAZQUEZ. Without objection, H.R. 3537 is 
considered as read and open for amendment at any point.
    Are there any members who wish to offer an amendment?
    Seeing none, the question is now on H.R. 3537.
    All those in favor, say aye.
    All those opposed, say no.
    In the opinion of the Chair, the ayes have it. H.R. 3537 is 
agreed to.
    The question now occurs on reporting H.R. 3537 to the 
House.
    All those in favor, say aye.
    All those opposed, say no.
    In the opinion of the Chair, the ayes have it, and H.R. 
3537 is reported to the House.
    Without objection, the Committee staff is authorized to 
correct punctuation, make other necessary technical corrections 
and conforming changes. Without objection, members shall also 
be entitled to 2 days to file additional supplemental, 
dissenting, and minority views.
    Our second bill today is H.R. 3734, the ``Successful 
Entrepreneurship for Reservists and Veterans Act'', introduced 
by Ms. Davids and cosponsored by Ranking Member Chabot. This 
bill provides for greater transparency and analysis reporting 
so that this Committee can better understand the financing 
needs of veterans and gather regular snapshots of programmatic 
outreach and education to veterans.
    I would now like to recognize the gentlelady from Kansas, 
Ms. Davids, the sponsor of the bill, for an opening statement 
of H.R. 3734.
    Ms. DAVIDS. Thank you, Chairwoman.
    Access to capital is one of the most important first steps 
entrepreneurs take when starting a business. And it is also one 
of the biggest difficulties. It remains a challenge throughout 
the life of a small business, even successful ones.
    This is especially true for our veterans. Growing up with a 
parent in the military, I know firsthand how frequent moving 
can be hard on veterans' personal networks and their ability to 
accumulate credit. Veterans often have a more difficult time 
accessing capital and credit as it can be difficult to collect 
credit during service. That is why I introduced the Successful 
Entrepreneurship for Reservists and Veterans Act, or the SERV 
Act, along with Ranking Member Chabot.
    The SERV Act requires a report from the Comptroller General 
of the United States on the ability of veteran and reservist 
small business owners to access credit. The report will include 
new information and analysis on the source of credit that 
veterans use to start and maintain their businesses, as well as 
how deployment and other military responsibilities affect 
veterans' and reservists' credit.
    Studying the problem of access to credit for veterans and 
reservists is a crucial first step in finding solutions. The 
Small Business Administration has many different programs aimed 
at helping veterans transition their military skills from 
service to business, like the Veterans Business Outreach 
Centers, Boots to Business, which we have heard about, the 
Service-Disabled Entrepreneurship Development Training program, 
and the Women Veteran Entrepreneurship Training program.
    As we heard in our hearing last week on veteran 
entrepreneurship, these programs provide vital resources to 
veterans. But they can only be helpful if veterans use them. 
That is why the SERV Act requires the Interagency Task Force 
for Small Business Development to develop a plan for outreach 
and promotion of these incredible programs.
    The Task Force is responsible for coordinating Federal 
efforts to improve capital access, business development, and 
contracting opportunities for veteran and service-disabled 
small businesses. But the last time it submitted a report to 
Congress was in 2015. The SERV Act requires the Task Force to 
report annually to Congress on its appointments and to outline 
its plan for outreach on the many programs available to 
veterans, service-disabled veterans, reservists, and their 
spouses.
    I would like to close by thanking Chairwoman Velazquez and 
Ranking Member Chabot for holding last week's important hearing 
on veteran entrepreneurs and for holding this bipartisan markup 
today. And thank you to Mr. Chabot, Ranking Member Chabot, for 
cosponsoring this important legislation.
    Chairwoman VELAZQUEZ. The gentlelady yields back.
    Are there any other members who wish to be recognized for a 
statement on H.R. 3734?
    Mr. CHABOT. Madam Chair?
    Chairwoman VELAZQUEZ. The gentleman, Ranking Member, Mr. 
Chabot, is recognized.
    Mr. CHABOT. Thank you, Madam Chairwoman.
    And I want to thank the gentlelady from Kansas, Ms. Davids, 
for working with us on this measure as well.
    Although the country continues to record above average 
economic marks, the Nation's smallest firms still face 
challenges when it comes to financing their businesses. This is 
even more pronounced for the category of small businesses we 
are discussing today, our Nation's veteran-owned small 
businesses. We heard testimony, again, to that fact just last 
week.
    Unfortunately, there is a scarcity of data regarding credit 
availability for veterans, service-disabled veterans, and 
reserve-owned small businesses. Given the importance of this 
segment of the small business population, improved data streams 
are needed to thoughtfully improve the SBA's offerings to these 
firms.
    H.R. 3734, the SERV Act, requires the administrator of the 
SBA to produce an annual report outlining a plan for outreach 
and promotion of the SBA programs and services for veterans. 
The bill also requires the GAO to conduct a study about the 
availability of credit to veteran, service-disabled veteran, 
and reservists owned small businesses.
    It is a very good bill. It is a good government bill that 
will help future Congresses tailor their access to capital 
programs to better serve veteran-owned small businesses.
    So I want to again thank the gentlelady from Kansas, Ms. 
Davids, for working with me on this very important bill, and I 
yield back my time.
    Chairwoman VELAZQUEZ. The gentleman yields back.
    Are there any other members who wish to be recognized for a 
statement?
    If not, I will recognize myself.
    It is important the message that we are sending today to 
our disabled veterans and reservists, that we are not checking 
a box. We are creating and codifying programs that we 
understand are important. But those programs will not do any 
good if we don't have metrics, if we don't have a report so 
that we could enact changes to it to make it meaningful for 
those that are intended to help. So annual reporting allows 
Congress to have this ability over the task force responsible 
for serving our veterans at SBA and the ability to provide 
proper oversight. Gathering a regular snapshot of the program 
enables Congress to make modifications where they are needed in 
a timely fashion.
    So let me take this opportunity to thank Ms. Davids and 
Ranking Member Chabot for their collaboration, and I urge my 
colleagues to support the bill.
    If there is no further discussion, the Committee will move 
on to consideration of H.R. 3734.
    The clerk will report the title of the bill.
    The CLERK. H.R. 3734, the Successful Entrepreneurship----
    Chairwoman VELAZQUEZ. Without objection, H.R. 3734 is 
considered as read and open for amendment at any time.
    Does anyone wish to offer an amendment?
    Seeing none, the question is now on H.R. 3734.
    All those in favor, say aye.
    All those opposed, say no.
    In the opinion of the Chair, the ayes have it, and H.R. 
3734 is agreed to.
    The question now occurs on reporting H.R. 3734 to the 
House.
    All those in favor, say aye.
    All those opposed, say no.
    In the opinion of the Chair, the ayes have it. H.R. 3734 is 
reported to the House.
    Without objection, the Committee staff is authorized to 
correct punctuation, make other necessary technical corrections 
and conforming changes. Without objection, members shall also 
be entitled to 2 days to file additional supplemental, 
dissenting, and minority views.
    The next bill for consideration is H.R. 3661, the 
``Patriotic Employer Protection Act'', introduced by Mr. Kim 
and cosponsored by Mr. Burchett. This commonsense legislation 
recognizes the service of our reservists by broadening their 
ability to access loans.
    I would like to recognize the gentleman from New Jersey for 
an opening statement.
    Mr. KIM. Thank you, Chairwoman and Ranking Member, for your 
leadership on these issues and for considering my bill, the 
``Patriotic Employer Protection Act.''
    I also want to thank my coauthor, Congressman Burchett from 
Tennessee, for his voice and advocacy on this important 
bipartisan bill.
    My bill will restructure, reform, and revitalize two 
critical programs to help our military reservists and empower 
patriotic small business owners who employ them.
    The Military Reservists Economic Injury Disaster program 
and the Repayment Deferral for Active Duty Reservist program 
are built to help small businesses weather the shock when an 
employee or owner who is a reservist is called up as part of 
the National Guard or reservist duties.
    The Military Reservist Economic Injury Disaster program 
does this through a direct loan program that provides emergency 
working capital for small businesses to meet their obligations 
while an employee or owner is serving our country. The 
Repayment Deferral for Active Duty Reservist program authorizes 
the Small Business Administration to work with private lenders 
to defer interest or loan payments--or repayments for small 
businesses facing similar circumstances.
    Both of these programs are well intentioned, but they are 
outdated and underutilized. My bill seeks to change that. The 
``Patriotic Employer Protection Act'' would restructure these 
programs so that they reflect the current realities for 
reservists today. Specifically, my bill would remove 
restrictions that limit use of programs to Active Duty during a 
period of military conflict. Instead, reservists who are 
ordered to perform active service for a period of more than 30 
consecutive days would be eligible for these programs.
    In simple English, the way we deploy our Reserves has 
changed, and the programs that support those reservists and the 
small businesses that put food on their table have to change 
with it.
    For our reservists, these issues aren't theoretical; they 
are personal. And there are personal stories that we have seen 
year over year of small businesses' employees who have been 
negatively impacted by this system.
    A Washington Post report from nearly 15 years ago told the 
story of Stanley Adams, a small business owner and reservist 
who had to shut down one of his otherwise thriving businesses 
when he was deployed to Iraq in 2003. During his deployment, 
his company's revenue dropped from $1.5 million to a quarter of 
a million. And when asked of the impact on his small business, 
Adams said everything came to a halt, and all this money still 
had to be paid.
    Mr. Adams was able to use a Small Business Administration 
program to help him keep his other businesses afloat. But let's 
be clear, he had choose between his duty in the Reserves and 
keeping his businesses thriving. That is a choice that no 
servicemember or small business owner should ever have to make.
    I am lucky to represent New Jersey's 3rd District. It is 
made of Burlington and Ocean Counties and home of Joint Base 
McGuire-Dix-Lakehurst. And we have thousands of reservists that 
live in our communities. Every day, they go to work in small 
businesses that rely on them to grow and thrive. We owe it to 
our men and women in uniform to support them when they are out 
of uniform. We owe it to the small business owners that employ 
them to give them our support when they support our 
servicemembers.
    My fellow Committee members, I encourage you to support 
this bill and our patriotic small business owners. I encourage 
the support of this bill, and I yield back.
    Chairwoman VELAZQUEZ. The gentleman yields back.
    Are there any other members who wish to be recognized for a 
statement on H.R. 3661?
    Mr. Burchett is recognized for 5 minutes.
    Mr. BURCHETT. Thank you, Chairlady Velazquez and Ranking 
Member Chabot, for proceeding to this markup that focuses on 
legislation aimed at assisting veteran entrepreneurs and those 
that are still serving our country proudly.
    Many of the skills honed during military service--
leadership, decision making, ability to adapt to different 
situations seamlessly--are the skills required to launch and 
grow a successful business. The men and women in uniform are 
our next great business leaders. This stands true for the 
dedicated servicemembers from east Tennessee, the area I 
represent. And I know this is true across the country as well. 
That is why I want to thank Representative Kim for working in a 
bipartisan manner with me on H.R. 3661, the ``Patriotic 
Employer Protection Act.''
    When a small business experiences a loss because of one of 
their significant employees is called up for Active Duty 
service, a small business could receive an SBA Military 
Reservist Economic Injury Disaster Loan. The ``Patriotic 
Employer Protection Act,'' among other things, adds those on 
full-time National Guard duty to the list of the essential 
employees called up for duty. This change will better align 
SBA's disaster loan program to reflect the current use of our 
military.
    Small businesses drive our economy, and servicemembers 
guard our freedom. And this legislation will help protect 
patriotic employers and employees when they are called into 
service. And I lend my full support to this bill, and I yield 
back.
    Chairwoman VELAZQUEZ. The gentleman yields back.
    And now I recognize Ranking Member Chabot for 5 minutes.
    Mr. CHABOT. Thank you, Madam Chair.
    In the interest of time, let me just say thank you very 
much to the gentleman from New Jersey, Mr. Kim, and the 
gentleman from Tennessee, Mr. Burchett, for working together on 
behalf of the men and women of our Armed Forces. We definitely 
appreciate it very much, and I yield back.
    Chairwoman VELAZQUEZ. The gentleman yields back.
    I would like to make a statement in support of this 
legislation.
    Over the past decade, our reserve forces have experienced a 
shift from a strategic reserve to an operational reserve. This 
bill addresses that shift by expanding the pool of eligible 
reservists through a restructuring of the programs so they are 
not limited to periods of conflicts.
    I commend Congressman Kim, Burchett, and Schneider for 
improving access to affordable capital for small businesses, 
especially those owned by or who employ reservists. I urge my 
colleagues to support the measure.
    If there is no further discussion, the Committee will move 
on consideration of H.R. 3661.
    The clerk will report the title of the bill.
    The CLERK. H.R. 3661, the ``Patriotic Employer Protection 
Act.''
    Chairwoman VELAZQUEZ. Without objection, H.R. 3616 is 
considered as read, and as customary for Committee practice, 
open for amendment at any point.
    Does anyone wish to offer an amendment?
    Seeing none, the question is now on H.R. 3661.
    All those in favor, say aye.
    All those opposed, say no.
    In the opinion of the Chair, the ayes have it, and H.R. 
3661 is agreed to.
    The question now occurs on reporting H.R. 3661 to the 
House.
    All those in favor, say aye.
    All those opposed, say no.
    In the opinion of the Chair, the ayes have it. H.R. 3661 is 
reported to the House.
    Without objection, the Committee staff is authorized to 
correct punctuation and make all the necessary technical 
corrections and conforming changes. Without objection, members 
shall also be entitled to 2 days to file additional 
supplemental, dissenting, and minority views.
    The next bill is H.R. 1615, the ``Verification Alignment 
and Service-Disabled Business Adjustment Act,'' a bill to 
simplify and consolidate the certification process for service-
disabled veteran-owned small businesses within the SBA. This 
bipartisan legislation was authored by Mr. Kelly and 
cosponsored by Mr. Crow.
    I would like to now recognize the gentleman from 
Mississippi, Mr. Kelly, the sponsor of H.R. 1615, for an 
opening statement.
    Mr. KELLY. Thank you, Madam Chair and Ranking Member 
Chabot. I would like to thank the Committee for considering my 
bill, H.R. 1615, the VA-SBA Act.
    As we have heard in previous hearings, the VA proactively 
verifies service-disabled veteran-owned small businesses, while 
the SBA allows business owners to self-certify. This process 
creates inconsistent outcomes such as a business qualifying as 
a service-disabled veteran business for VA contracts but not 
other Federal agency contracts, or vice versa.
    While the SBA certified business awards are subject to 
scrutiny, the lack of a front end verification leaves the door 
open for fraud and abuse. We have already made significant 
strides in the right directions. The National Defense 
Authorization Act for fiscal year 2017 instructed the SBA and 
VA to unify the definitions for service-disabled veteran-owned 
small businesses and began moving regulatory responsibility 
from the VA to the SBA.
    President Trump's reform plan for the Federal Government 
released last year cited the need for a one-stop shop for small 
business Federal procurement programs. The SBA has already made 
headway through the launch of their website, certify.sba.gov, 
and we are committed to working with them to see it through.
    The VA-SBA marks the next significant step towards 
unification of the two programs under one umbrella at the SBA 
and reduces red tape and confusion from veteran small business 
owners.
    Thanks again for considering my bill. And I thank Mr. Crow 
for joining us on this.
    And at the appropriate time, I will have an amendment at 
the desk, Madam Chair.
    Chairwoman VELAZQUEZ. The gentleman yields back.
    Are there any other members who wish to be recognized for a 
statement on H.R. 1615?
    Mr. Crow, the gentleman from Colorado, is recognized for 5 
minutes.
    Mr. CROW. Thank you, Madam Chairwoman. Thank you for the 
opportunity to speak in support of the ``Veteran Alignment and 
Service-Disabled Business Adjustment Act,'' or the VA-SBA Act.
    I want to thank my friend and fellow paratrooper, the 
gentleman from Mississippi, Mr. Kelly, for his leadership on 
this issue.
    Veterans are uniquely qualified and have a valuable 
perspective as they start and manage small businesses. In my 
home State of Colorado, there are over 52,000 veteran-owned 
small businesses that continue to give back to our community 
and economy even after serving our country.
    Currently, the Department of Veterans Affairs and the Small 
Business Administration support service-disabled veterans 
through two different separate programs. As we have already 
heard from today, they receive support that they go through a 
rigorous application process which is duplicative, confusing, 
and redundant.
    So I am proud to be an original cosponsor of the VA-SBA Act 
which will harmonize both programs under the SBA, cutting back 
on unnecessary red tape while, at the same time, protecting 
against fraud and abuse. It also ensures that data on service-
disabled veteran-owned small businesses and veteran-owned small 
businesses lives at the SBA, which is uniquely equipped to 
serve veterans who want to start small businesses.
    This bill provides the support and resources our veterans 
deserve as they continue to go above and beyond to hire other 
veterans, including those who have been injured in the line of 
duty, and contribute to their communities upon returning from 
their service. There is a sacred promise in America that if you 
step up to serve, we will be there when you take off the 
uniform, and this bill does exactly that for veterans that own 
small businesses.
    I yield back the balance of my time.
    Chairwoman VELAZQUEZ. The gentleman yields back.
    Are there any other members who wish to be recognized?
    Mr. Chabot is recognized for 5 minutes.
    Mr. CHABOT. Thank you, Madam Chair.
    I just want to, again, in the order--because of time 
constraints, I want to thank Mr. Kelly of Mississippi, Mr. Crow 
of Colorado, the two for working together. I think they 
explained the purposes of this legislation and why I would urge 
members to support it and thank them for their efforts. And I 
yield back.
    Chairwoman VELAZQUEZ. The gentleman yields back.
    Are there any other members who wish to be recognized on 
this?
    Let me recognize myself.
    The problem with the two certification processes is simple; 
it creates confusion for business owners and contracting 
officers alike. This bill harmonizes the two conflicting 
contracting programs by eliminating the VA certification and 
transferring it to the SBA. It also institutes a certification 
process under the SBA program to prevent concerns of fraud and 
abuse.
    I want to thank all the members of this Committee that have 
sponsored this bill, because it is certainly a step in the 
right direction to eliminate duplication and confusion between 
the two agencies. This bipartisan legislation will make it 
easier for the veteran-owned businesses to do business with the 
government. Therefore, I urge my colleagues to support the 
measure.
    If there is no further discussion, the Committee now moves 
to consideration of H.R. 1615.
    The clerk will report the title of the bill.
    The CLERK. H.R. 1615, the Verification Alignment----
    Chairwoman VELAZQUEZ. Without objection, H.R. 1615 is 
considered as read and open for amendment at any point.
    Does anyone wish to offer an amendment?
    Mr. KELLY. Madam Chairwoman, I have an amendment at the 
desk.
    Chairwoman VELAZQUEZ. The clerk will report the amendment.
    The CLERK. Amendment to H.R. 1615, offered by Mr. Kelly of 
Mississippi.
    Chairwoman VELAZQUEZ. Without objection, the amendment is 
considered as read.
    The gentleman is recognized for 5 minutes.
    Mr. KELLY. Thank you, Madam Chair and Ranking Member 
Chabot.
    I would like to offer this amendment in the nature of a 
substitute which makes some small yet critical enhancements to 
understanding this important legislation. These changes in the 
underlying bill text came from conversations with the Small 
Business Administration, the agency that will be overseeing 
this new service-disabled veteran-owned small business 
certification program. And I think it reasonable to incorporate 
their suggestions into the underlying bill text.
    First, the amendment underscores the intention for the 
Small Business Administration to inherit the Department of 
Veterans Affairs current records of certified service-disabled 
veteran-owned firms and continue to maintain a list of 
certified firms. The amendment makes clear it is up to the 
discretion of the SBA to utilize the technology solution it 
determines best suited to capturing this information, and there 
is no requirement that the agency take on the hardware and 
software infrastructure at the VA unless the agency deems it is 
a necessary part of the transition.
    Secondly, the amendment strikes Section 4 of H.R. 1615 
regarding sole source thresholds. The inclusion of this section 
was dependent on the passage of a separate bill, which is still 
working its way through the legislative process. There will be 
ample opportunity to reconsider this provision at a later date 
but not at this juncture.
    Third, the amendment strikes reference to self-certified 
veteran-owned business in Section 8 of H.R. 1615 in order to 
reduce any unnecessary misconception that the SBA permits self-
certification of veteran-owned small business in its prime 
contracting program. This revised section better aligns with 
current SBA policies and addresses the steps self-certified 
service-disabled veteran-owned small businesses must take in 
order to maintain their SDVOSB status.
    To sum up, this amendment in the nature of a substitute 
provides important clarity to ensure that the public and 
implementing agencies interpret this language in the way 
Congress intended.
    I urge support of my colleagues, and I yield back the 
balance of my time.
    Chairwoman VELAZQUEZ. The gentleman yields back.
    Are there any other members who wish to be recognized for a 
statement on the amendment?
    Mr. CHABOT. Madam Chair?
    Chairwoman VELAZQUEZ. Mr. Chabot, you are recognized for 5 
minutes.
    Mr. CHABOT. Thank you, Madam Chair. I will be brief.
    I would like to thank Mr. Kelly for offering this amendment 
and for coordinating with the SBA to improve this legislation.
    This amendment makes several revisions to the legislation 
to ensure the intent of these provisions is clear to the public 
and to the implementing agency. Clarity in the law is 
important, and this amendment provides exactly that.
    So I would urge my colleagues to support the amendment, and 
I yield back.
    Chairwoman VELAZQUEZ. Are there any other members who wish 
to be recognized on this amendment?
    If not, let me just say this is a straightforward amendment 
that provides clarity, and I urge my colleagues to support it.
    The question is now on amendment 1.
    All those in favor, say aye.
    All those opposed, say no.
    In the opinion of the Chair, the ayes have it, and the 
amendment is agreed to.
    Are there any other members who wish to be recognized for 
the purposes of offering an amendment?
    Seeing none, the question is now on H.R. 1615, as amended.
    All those in favor, say aye.
    All those opposed, say no.
    In the opinion of the Chair, the ayes have it, and H.R. 
1615, as amended, is agreed to.
    The question now occurs on reporting H.R. 1615, as amended, 
to the House.
    All those in favor, say aye.
    All those opposed, say no.
    In the opinion of the Chair, the ayes have it. H.R. 1615, 
as amended, is reported to the House.
    Without objection, the Committee staff is authorized to 
correct punctuation and make all the necessary technical 
corrections and conforming changes. Without objection, members 
shall also be entitled to 2 days to file additional 
supplemental, dissenting, and minority views.
    The next bill is H.R. 499, the ``Service-Disabled Veterans 
Small Business Continuation Act,'' introduced by Ranking Member 
Chabot and sponsored by Mr. Delgado, which protects small 
businesses owned by disabled veterans by providing a 
transitionary period to keep SDVOSB status in the event of the 
business owner's death.
    I will now recognize the gentleman from Ohio and the 
Ranking Member of the Committee, the author of the bill, for an 
opening statement.
    Mr. CHABOT. Thank you, Madam Chairwoman.
    I, like all members of this Committee, hear from many 
constituents on a wide range of small business issues. One of 
the things that is particularly important to me and those folks 
in my district is to ensure that veterans and their families 
receive fair treatment from the Federal Government which they 
have served so bravely. Many of these veterans come home and 
decide to become entrepreneurs, whether to sustain a living for 
their families or to contribute to their communities in a 
meaningful way.
    Unfortunately, currently there is a conflict in the law 
regarding the treatment of surviving spouses of service-
disabled veteran small business owners between the VA and the 
SBA. Congress has already codified in title 38 a commonsense 
provision allowing the surviving spouse of a service-disabled 
veteran small business owner with a less than 100 percent 
disability rating to retain the company's SDVOSB status for a 
certain amount of time.
    Unfortunately, the Small Business Act currently has no such 
provision. This lack of parity creates legal uncertainty and 
confusion in the application of this important protection for 
spouses of veteran business owners, the veteran owners 
themselves, and all those who rely on these businesses after 
the veteran owner passes away. This is why this bill, H.R. 499, 
is so important.
    The bill aligns title 15 with title 38, ensuring continuity 
across the government for this important policy. This bill will 
provide our Nation's heroes and their families with peace of 
mind.
    I also want to thank the gentleman from New York, Mr. 
Delgado, for working together on this legislation and urge my 
colleagues to support this bill.
    And I yield back.
    Chairwoman VELAZQUEZ. The gentleman yields back. And I 
appreciate his work on this issue.
    Are there any other members who wish to be recognized for a 
statement on H.R. 499?
    Mr. DELGADO. Yes.
    Chairwoman VELAZQUEZ. The gentleman from New York, Mr. 
Delgado, is recognized for 5 minutes.
    Mr. DELGADO. Thank you, Madam Chairwoman.
    I would like to thank you, along with Ranking Member 
Chabot, for your work on legislation that we are working on 
today, legislation that will improve the ability of veterans 
and their families who start or continue running a business.
    I am especially glad to see that the bill I first 
introduced as a Member of Congress, the very first bill, the 
``Service-Disabled Veterans Small Business Continuation Act,'' 
is being taken up by the Committee. And I am honored that I was 
able to introduce this bill along with Ranking Member Chabot 
and Representatives Bergman and Correa.
    With veterans and their families sacrificing so much for 
our rights and freedoms, it is our solemn obligation as a 
Nation to ensure that their health and well-being is protected. 
Currently, the spouses of service-disabled veterans can receive 
preference for contracts with the Department of Veterans 
Affairs. But this preference is rescinded if the veteran passes 
away, unless he or she was 100 percent disabled.
    The Service-Disabled Veterans Small Business Continuation 
Act would allow the spouses of deceased service-disabled 
veterans to retain their status as a service-disabled veteran-
owned small business for 3 years, regardless of the degree to 
which a veteran was disabled. This will give surviving spouses 
the opportunity to remain competitive in the Federal 
contracting market.
    After 3 years of service the veterans and their families 
give to us, we need to provide them with both stability and 
opportunities for growth.
    Thank you again to Ranking Member Chabot for his leadership 
on this issue. I am proud to see this legislation is being 
marked up, and urge my colleagues to support it.
    I yield back.
    Chairwoman VELAZQUEZ. The gentleman yields back.
    Are there any other members who wish to be recognized?
    I will now recognize myself briefly.
    This bill codifies our intention to bridge the differences 
between the SBA and VA by establishing uniformity. We know that 
running a small business often involves many members of a 
family. By extending survival spousal rights to the SDVOSB 
definition, we are honoring the sacrifice they made for our 
country. We are also providing stability for that business to 
ensure that they can remain competitive rather than immediately 
penalized by the death of the service-disabled veteran business 
owner.
    I want to thank Ranking Member Chabot and Mr. Delgado for 
working together to ensure that, when a disabled veteran 
business owner passes, the law does not impose insult to injury 
by penalizing the surviving spouse. I urge my colleagues to 
support the bill.
    If there is no further discussion, the Committee will move 
on to consideration of H.R. 499.
    The clerk will report the title of the bill.
    The CLERK. H.R. 499, the Service-Disabled----
    Chairwoman VELAZQUEZ. Without objection, H.R. 499 is 
considered as read and open for amendment at any point.
    Does anyone wish to offer an amendment?
    Seeing none, the question is now on H.R. 499.
    All those in favor, say aye.
    All those opposed, say no.
    In the opinion of the Chair, the ayes have it, and H.R. 499 
is agreed to.
    The question now occurs on reporting H.R. 499 to the House.
    All those in favor, say aye.
    All those opposed, say no.
    In the opinion of the Chair, the ayes have it. H.R. 499 is 
reported to the House.
    Without objection, the Committee staff is authorized to 
correct punctuation, make other necessary technical corrections 
and conforming changes. Without objection, members shall also 
be entitled to 2 days to file additional supplemental, 
dissenting, and minority views.
    So with that, we finished our markup.
    I want to take this opportunity to thank all the members 
for their participation today.
    And if there is no further business to come before the 
Committee, we are adjourned.
    [Whereupon, at 12:21 p.m., the Committee was adjourned.]
                           
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