    [House Hearing, 118 Congress]
    [From the U.S. Government Publishing Office]

                             ORGANIZATIONAL MEETING

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

                                    HEARING

                                  BEFORE THE

                          COMMITTEE ON SMALL BUSINESS
                                 UNITED STATES
                            HOUSE OF REPRESENTATIVES

                        ONE HUNDRED EIGHTEENTH CONGRESS

                                 FIRST SESSION

                                   __________

                                  HEARING HELD
                                FEBRUARY 8, 2023

                                   __________

    [GRAPHIC NOT AVAILABLE IN TIFF FORMAT]

                Small Business Committee Document Number 118-001
                 Available via the GPO Website: www.govinfo.gov

                                  __________

                        U.S. GOVERNMENT PUBLISHING OFFICE
    51-184                    WASHINGTON : 2023

    -----------------------------------------------------------------------------------

                       HOUSE COMMITTEE ON SMALL BUSINESS

                        ROGER WILLIAMS, Texas, Chairman
                          BLAINE LUETKEMEYER, Missouri
                            PETE STAUBER, Minnesota
                            DAN MEUSER, Pennsylvania
                             BETH VAN DUYNE, Texas
                             MARIA SALAZAR, Florida
                              TRACEY MANN, Kansas
                               JACK ELLZEY, Texas
                            MARC MOLINARO, New York
                             MARK ALFORD, Missouri
                               ELI CRANE, Arizona
                              AARON BEAN, Florida
                               WESLEY HUNT, Texas
                             NICK LALOTA, New York
                   NYDIA VELAZQUEZ, New York, Ranking Member
                              JARED GOLDEN, Maine
                             KWEISI MFUME, Maryland
                            DEAN PHILLIPS, Minnesota
                              GREG LANDSMAN, Ohio
                           MORGAN MCGARVEY, Kentucky
                      MARIE GLUESENKAMP PEREZ, Washington
                           HILLARY SCHOLTEN, Michigan
                            SHRI THANEDAR, Michigan
                              JUDY CHU, California
                             SHARICE DAVIDS, Kansas
                          CHRIS PAPPAS, New Hampshire

                      Ben Johnson, Majority Staff Director
                     Melissa Jung, Minority Staff Director

                                C O N T E N T S

                               OPENING STATEMENTS

                                                                       Page
    Hon. Roger Williams..............................................     1
    Hon. Nydia Velazquez.............................................     2

                                    APPENDIX

    Additional Material Submitted for the record:
        Rules and Procedures.........................................     8
        Authorization and Oversight Plan.............................    25

                             ORGANIZATIONAL MEETING

                                  ----------

                          WEDNESDAY, FEBRUARY 8, 2023

                      House of Representatives,
                   Committee on Small Business,
                                                        Washington, DC.
        The Committee met, pursuant to call, at 3:31 p.m., in Room
    2360, Rayburn House Office Building, Hon. Roger Williams
    [Chairman of the Committee] presiding.
        Present: Representatives Williams, Luetkemeyer, Stauber,
    Meuser, Salazar, Ellzey, Molinaro, Alford, Crane, Bean, LaLota,
    Velazquez, Mfume, Phillips, Landsman, McGarvey, Gluesenkamp
    Perez, Scholten, Thanedar, Davids, and Pappas.
        Chairman WILLIAMS. Good afternoon, everybody. We are going
    to get started. And let me just say before we get started, as
    we start our next hearings that we have coming up, we are going
    to be saying the Pledge of Allegiance and a short blessing,
    just like we do on the House floor. And so, if any of our
    colleagues on either side of the aisle are interested in
    leading the Pledge or blessing for a hearing, let my office
    know. We will get you on the schedule. So let us begin.
        The Committee will now come to order, and without
    objection, the Chair is authorized to declare a recess of the
    Committee at any time. I want to welcome all our Members, both
    returning and new, to the organizational meeting of the
    Committee on Small Business for the 118th Congress.
        This meeting will proceed as follows. First, Ranking Member
    Velazquez and I will introduce our Members on each side. Then
    we will introduce and officially approve our Subcommittee
    Chairs. Next, we will officially adopt our Committee rules. And
    finally, we will officially adopt our Committee's authorization
    and oversight plan.
        I want to take a moment to recognize Ranking Member
    Velazquez. As you said last year, Ms. Velazquez, small business
    deserve our partnership. And I look forward to working together
    to make the small business in this nation better and more
    prosperous. And I think we will find out we have much more in
    common than we don't.
        As a small business owner myself, I know firsthand the
    hardship many small businesses face every single day. As
    Chairman, I hope we can come together, conduct meaningful
    oversight of the many problems in the SBA during the COVID-19
    pandemic and of the overburdensome regulations coming out of
    the Biden administration.
        Now, before I introduce our new Members, I want to welcome
    back Congressman Blaine Luetkemeyer from Missouri, who will
    serve as the Vice Chair of this Congress. I was his Vice
    Ranking Member last year, and I look forward to continuing to
    work together to make America the greatest country in the world
    and the best place to do business.
        So now I want to introduce the new Majority Members of this
    Committee. First, Congressman Tracey Mann from Kansas,
    Congressman Jake Ellzey from Texas, Congressman Marc Molinaro
    from New York, Congressman Mark Alford from Missouri,
    Congressman Eli Crane from Arizona, Congressman Aaron Bean from
    Florida, Congressman Wesley Hunt from Texas, and Congressman
    Nick LaLota from New York.
        I also want to welcome back our Members returning to the
    Committee: Congressman Pete Stauber from Minnesota, who is
    serving his third term in Congress and served on two of our
    Subcommittees last Congress; Congressman Dan Meuser from
    Pennsylvania, who was our Ranking Member of the Subcommittee on
    Economic Growth, Tax, and Capital Access last Congress;
    Congresswoman Beth Van Duyne from Texas, who served as our
    Ranking Member for the Subcommittee on Oversight,
    Investigations, and Regulations last Congress; and finally,
    Congresswoman Maria Salazar from Florida, who served as our
    Ranking Member for the Subcommittee on Contracting
    Infrastructure last Congress. I am excited to have you all join
    us for the 118th, and I am looking forward to all we will
    accomplish together as we move forward.
        So with that, I will yield to our distinguished Ranking
    Member from New York, Ms. Velazquez.
        Ms. VELAZQUEZ. Thank you, Chairman Williams, and
    congratulations on your new role.
        Small businesses make vital contributions to our economy.
    Not only do they generate two out of the three net jobs, but
    they drive innovation and economic progress throughout our
    country. However, the past few years have not been easy for
    small businesses. The pandemic brought challenges that were
    unthinkable a short time ago. Perseverance, combined with the
    historic investment in economic recovery, helped millions of
    small firms stay afloat.
        Since January 2021, there has been over 10.5 million
    applications for new businesses. In January 2022, we smashed
    economic growth expectations with the addition of more than
    500,000 new jobs--but our work is not done. Looking ahead, we
    must work together on this Committee to make sure small
    businesses are given the resources and protections they need to
    prosper. I hope we can continue our bipartisan tradition during
    the 118th Congress and show our constituents and new Members
    what it is like to make real change happen.
        I now would like to welcome our new and returning Members
    and take a moment to introduce the Democratic Members on our
    side. Let me begin with the newest Members of our Committee.
    First is Mr. Greg Landsman of Ohio. He is a former public
    school teacher and faith-based nonprofit leader who served five
    terms on the Cincinnati City Council before being elected to
    Congress. As someone with deep community connections, he will
    be a vital resource to our efforts to strengthen our nation's
    main street.
        Our next freshman Member is Mr. Morgan McGarvey, an
    attorney from Louisville, Kentucky, with a history and track
    record of representing the interests of small businesses. His
    passion for serving his community led him to run for Kentucky
    State Senate in 2012, where he became the minority leader by
    2018. His leadership, legislative experience, and work ethic
    will be invaluable to this Committee.
        I would also like to introduce Ms. Marie Gluesenkamp Perez,
    a working mother and small business owner from Southwest
    Washington. She started her auto repair and machine shop with
    her husband, Dean, with the help of an SBA loan. Her experience
    with SBA and running her own business is exactly the type of
    knowledge we need on the Committee.
        Next are two Members from Michigan. First, Ms. Hillary
    Scholten, an attorney who clerked with the U.S. Court of
    Appeals for the Second Circuit in a special unit focused on
    immigration. She is a proven leader that is committed to
    finding common sense solutions. Secondly, Mr. Shri Thanedar,
    who immigrated to the U.S. at age 24 with $20. Discovering a
    passion for entrepreneurship, he started several small
    businesses, and his success with the SBIR program will be an
    asset to this Committee.
        Last but not least is Mr. Chris Pappas of New Hampshire,
    who helps run his family's 100-year-old restaurant. As a third-
    term Member of Congress, he serves on the Committee on
    Transportation and Infrastructure and Committee on Veterans
    Affairs.
        I would also like to welcome back some excellent Members
    from last Congress: Jared Golden from Maine, Kweisi Mfume from
    Maryland, Dean Phillips of Minnesota, Judy Chu from California,
    and Sharice Davids of Kansas.
        Thank you and I yield back.
        Chairman WILLIAMS. Thank you. And I want to also welcome,
    of course, all the new Committee to the Republican side and all
    the Democratic side. Look forward to working with all of you.
    Thank you. And thank you, Ranking Member, for that.
        Now, I would like to introduce our five Subcommittee Chairs
    on the majority side. Congressman Dan Meuser will Chair the
    Subcommittee on Economic Growth, Tax, and Capital Access.
    Congresswoman Beth Van Duyne will Chair the Subcommittee on
    Oversight, Investigations, and Regulations. Congressman Wesley
    Hunt will Chair the Subcommittee on Rural Development, Energy,
    and Supply Chains. And Congressman Nick LaLota will Chair the
    Subcommittee on Contracting and Infrastructure. Congressman
    Marc Molinaro will Chair the Subcommittee on Innovation,
    Entrepreneurship, and Workforce Development.
        So, I want to thank all of you for your willingness to
    serve in that capacity. And now I yield to Ranking Member
    Velazquez to introduce the Ranking Members of the
    Subcommittees.
        Ms. VELAZQUEZ. Thank you, Mr. Williams. I would like to
    congratulate the Committee Chairs and Ranking Members. We have
    had some bright, dynamic Members join our Committee, and I am
    confident this will be a productive session.
        The full Committee Vice Ranking Member will be Dean
    Phillips. Kweisi Mfume will be the Ranking Member of the
    Subcommittee on Oversight, Investigations, and Regulations.
    Greg Landsman will be the Ranking Member of the Subcommittee on
    Economic Growth, Tax, and Capital Access. Morgan McGarvey will
    be the Ranking Member of the Subcommittee on Innovation,
    Entrepreneurship, and Workforce Development. Marie Gluesenkamp
    Perez will be the Ranking Member of the Subcommittee on Rural
    Development, Energy, and Supply Chains. Hilary Scholten will be
    the Ranking Member of the Subcommittee on Contracting and
    Infrastructure.
        Chairman WILLIAMS. All right, thank you very much. And I
    move that the list of Subcommittee Chairs and Ranking Members
    and as set forth in the rosters be approved.
        All those in favor, say aye.
        All those opposed, say no.
        In the opinion of the Chair, the ayes have it, and the
    Chairs and Ranking Members are appointed. Without objection,
    the motion to reconsider is laid on the table.
        I would like to now proceed to the Committee rules package.
    Pursuant to clause 2A of House Rule XI, the first order of
    business is adoption of the Committee's Rules of Procedure for
    the 118th Congress. A copy of the proposed rules has been
    distributed to each of you in advance.
        Now, the rules package is nearly the same as last Congress,
    with a few minor changes. For instance, the name and
    jurisdiction of some of the Subcommittees have been modified to
    better address the problems facing small business in today's
    economy. We clarified the procedure for deposition and
    subpoenas to align with the House rules. We added language to
    remove remote proceedings to align with the House rules and to
    ensure that we are here in person, working hard for the
    American people. And I think these changes will allow us to
    propel this Committee forward to the benefit of small
    businesses nationwide.
        So I now recognize Ranking Member Velazquez for her remarks
    on the rules.
        Ms. VELAZQUEZ. Thank you, Mr. Chairman. 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 note that, with a few exceptions, these rules are very
    similar to those of previous Congresses.
        With that said, I will be remiss if I didn't mention my
    concern over the new rule to grant the Chairman of the
    Committee unilateral subpoena authority. While I recognize this
    change is in line with House rules, our Committee has always
    required either a majority vote of the Committee or an
    agreement between the Chair and Ranking Member before the
    Committee issues a subpoena. Under the new rules, the Chairman
    has unilateral authority to issue a subpoena with no debate.
    Subpoenas should be a measure of last resort to prevent
    bringing important work to aid small businesses to a halt.
        I expressed these concerns to the Chairman, and we reached
    an agreement to require 24-hour notification to the minority
    before issuing a subpoena. Mr. Chairman, I appreciate your
    understanding and respect for honoring the minority's rights
    and, most importantly, of this Committee's bipartisanship and
    bipartisan history.
        Throughout my tenure on the Committee, we have conducted
    bipartisan oversight to hold the SBA to the highest standards,
    no matter if we were analyzing regular SBA programs or the
    COVID response programs. I look forward to our continued
    efforts in this area, and it is my hope that we will work
    together if a subpoena is to be issued. A Committee that is run
    openly and fairly is a Committee that works and can best
    achieve its objective.
        I yield back, Mr. Chairman.
        Chairman WILLIAMS. Thank you, Ms. Velazquez. And without
    objection, the draft Committee rules are considered as read and
    open for amendment at any point. Does any Member who wish to be
    recognized to offer amendments to the proposed Committee rules?
        Okay. If not, I move the proposed rules be adopted as the
    rules of the Committee on Small Business for the 118th
    Congress.
        All those in favor, say aye.
        All those opposed, say no.
        In the opinion of the Chair, the ayes have it, and the
    proposed rules are adopted. Now, without objection, the motion
    to reconsider is laid on the table. Pursuant to House rules,
    the rules adopted by the Committee on Small Business for 118th
    Congress will be published in the Congressional Record and made
    available to Members and the public on the Committee's website.
        Now, the next order of business before the Committee is the
    adoption of our Authorization Oversight Plan for the 118th
    Congress. House rule X, clause 2D, directs each standing
    Committee to no later than March 1 of the first session of a
    Congress in a meeting that is open to the public adopt its
    Authorization and Oversight Plan for that Congress. As required
    by the rules our plan includes descriptions of each program or
    agency that is intended to be authorized in the current
    Congress or the next Congress, and description of oversight to
    support reauthorization in the current Congress. In addition,
    the plan includes recommendations for removing any such
    programs or agencies from mandatory to discretionary funding.
    The Committee may consider reforms and improvements to various
    SBA programs as noted throughout this Authorization and
    Oversight Plan. The Committee's Authorization and Oversight
    Plan for the 118th Congress was compiled with input from the
    Ranking Minority Member and has been made available in advance
    to all Members.
        So, now I have recognized myself for 5 minutes to discuss
    the plan for this Congress.
        As a lifelong small business owner, I know firsthand how
    often the smallest changes in Washington, D.C., can have a
    disastrous impact on small businesses across America. Over the
    last 2 years, overburdensome regulations have harmed small
    businesses. As Chairman, I intend to focus this Committee's
    attention on resources, conducting rigorous oversight of costly
    regulatory burdens that are harming small businesses. Members
    of this Committee will be fierce advocates for free market
    principles and pro growth policies.
        We will work to highlight the American Dream and the many
    success stories of small business owners around the country
    with entrepreneurs and innovators from all corners of this
    country. We will hear from small business owners across the
    nation who are on the front lines of innovation and job
    creation, and we will investigate ways the Small Business
    Administration could improve the landscape for small business.
        We will investigate agencies' rulemaking process and work
    to ensure that the interests of small businesses are properly
    considered. We will work to remove excessive and burdensome
    regulations to make it easier for small businesses not only to
    form, but to stay in business and to grow. And we will amplify
    the voice of small business in Washington, D.C. I know my
    colleagues on both sides of the aisle are eager to get to work
    on behalf of main street America.
        With that, I yield to Distinguished Ranking Member
    Velazquez for 5 minutes for any remarks she may wish to make on
    the Oversight and Authorization Plan.
        Ms. VELAZQUEZ. Thank you, Chairman Williams. The Oversight
    Plan sets forth a policy framework for our work this Congress.
    Like in previous years, the plan calls for the robust oversight
    of the SBA and other federal small business initiatives, a long
    tradition that this Committee takes seriously. To that end,
    this Committee has forged a bipartisan consensus opposing the
    creation of unauthorized pilot programs. Diverting scarce
    taxpayers' dollars away from proven programs can open the door
    to fraud, waste, and abuse, something we are all working to
    minimize.
        On the other hand, this Committee has steadfastly supported
    statutorily authorized programs, including the Entrepreneurial
    Development Programs that offer free or low-cost counseling and
    training to small businesses. Lending programs help small
    businesses access affordable capital and contracting programs
    that help small businesses compete in the federal marketplace.
        In the past two Congresses, we held numerous hearings with
    GAO and the Office of the Inspector General and made it clear
    that safeguarding taxpayers' dollars was our top priority. In
    fact, our oversight efforts increased last Congress, primarily
    in an effort to work with the IG and DOJ to hold bad actors
    accountable for fraud in COVID programs. In that vein, we
    enacted two bills that gave the DOJ and other investigative
    agencies additional time to prosecute fraud in the PPP and
    COVID EIDL programs. These laws were the product of the robust
    bipartisan oversight conducted by our Committee.
        Additionally, regulatory burden is an important issue for
    small businesses, 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. I hope to work
    with my colleagues to review SBA rules, particularly the
    lending rules, to lift the 40-year moratorium on licensing new
    small business lending companies to participate in the 7A
    program. I have urged SBA to exercise caution in making
    substantial changes to this successful program and to take the
    time to review the issues and comments to the rule.
        I am fully committed to working with the agency and the new
    majority to protect the integrity of all SBA programs and
    ensure they serve small business owners as efficiently and
    effectively as possible.
        With that, I urge Members to approve this oversight plan
    and I get back.
        Chairman WILLIAMS. Thank you, Ranking Member. And as noted,
    the proposed Authorization Oversight Plan has been distributed
    to Members in advance. Now, without objection, the plan is
    considered as read and open for amendment at any point. Does
    any Member wish to be recognized to discuss the draft
    Authorization and Oversight Plan?
        Okay. Are there any amendments?
        All right. If not, I move the Authorization and Oversight
    Plan of the Committee on Small Business for the 118th Congress
    be adopted.
        All those in favor, say aye.
        All those opposed, say no.
        In the opinion of the Chair, the ayes have it, and the plan
    is adopted. Now, without objection, the motion to reconsider is
    laid on the table. As directed by House rule X the
    Authorization and Oversight Plan will be submitted
    simultaneously to the Committee on Oversight and Accountability
    and the Committee on House Administration, who will compile and
    report the plan submitted by the standing Committees to the
    House no later than April 1.
        So, this concludes today's business meeting. And I just
    want to say, this will be a fun Committee. We are going to get
    a lot of things done, and we are really going to help small
    business and create jobs and see a lot of results.
        So, without objection, Committee staff is authorized to
    make technical and conforming changes to reflect the action of
    the Committee in adopting the resolution embodying our rules.
    So, without objection, the Committee stands adjourned.
        Ms. VELAZQUEZ. Thank you.
        Chairman WILLIAMS. Thank you.
        [Whereupon, 3:51 p.m., the Committee was adjourned.]

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