[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

                               __________

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

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