[Congressional Record Volume 164, Number 74 (Tuesday, May 8, 2018)]
[House]
[Pages H3808-H3810]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




              SPURRING BUSINESS IN COMMUNITIES ACT OF 2017

  Mr. CHABOT. Mr. Speaker, I move to suspend the rules and pass the 
bill (H.R. 4111) to amend the Small Business Investment Act of 1958 to 
improve the number of small business investment companies in 
underlicensed States, and for other purposes.
  The Clerk read the title of the bill.
  The text of the bill is as follows:

                               H.R. 4111

       Be it enacted by the Senate and House of Representatives of 
     the United States of America in Congress assembled,

     SECTION 1. SHORT TITLE.

       This Act may be cited as the ``Spurring Business in 
     Communities Act of 2017''.

     SEC. 2. IMPROVING THE NUMBER OF SMALL BUSINESS INVESTMENT 
                   COMPANIES IN UNDERLICENSED STATES.

       The Small Business Investment Act of 1958 (15 U.S.C. 661 et 
     seq.) is amended--
       (1) in section 103 (15 U.S.C. 662)--
       (A) in paragraph (18)(E), by striking ``and'' at the end;
       (B) in paragraph (19), by striking the period at the end 
     and inserting ``; and''; and
       (C) by adding at the end the following:
       ``(20) the term `underlicensed State' means a State in 
     which the number of licensees per capita is less than the 
     median number of licensees per capita for all States, as 
     calculated by the Administrator.'';
       (2) in section 301(c) (15 U.S.C. 681(c))--
       (A) in paragraph (3)--
       (i) in subparagraph (B)(iii), by striking ``and'' at the 
     end;
       (ii) in subparagraph (C), by striking the period at the end 
     and inserting ``; and''; and
       (iii) by adding at the end the following:
       ``(D) shall give first priority to an applicant that is 
     located in an underlicensed State with below median 
     financing, as determined by the Administrator.''; and
       (B) in paragraph (4)(B)--
       (i) by striking clause (i);
       (ii) by redesignating clauses (ii) and (iii) as clauses (i) 
     and (ii), respectively; and
       (iii) by amending clause (i), as so redesignated, to read 
     as follows:
       ``(i) is located in a State that--

       ``(I) is not served by a licensee; or
       ``(II) is an underlicensed State; and''; and

       (3) in section 308(g) (15 U.S.C. 687(g))--
       (A) in paragraph (2)--
       (i) in subparagraph (B), by inserting ``and licensing'' 
     after ``financing'';
       (ii) by redesignating subparagraphs (C) through (J) as 
     subparagraphs (E) through (L), respectively; and

[[Page H3809]]

       (iii) by inserting after subparagraph (B) the following:
       ``(C) Steps taken by the Administration to improve the 
     number of licensees in underlicensed States.
       ``(D) The Administration's plans to support States that 
     seek to increase the number of licensees in the State.''; and
       (B) in paragraph (3)--
       (i) in subparagraph (C), by striking ``and'' at the end;
       (ii) in subparagraph (D), by striking the period at the end 
     and inserting ``; and''; and
       (iii) by adding at the end the following:
       ``(E) the geographic dispersion of licensees in each State 
     compared to the population of the State, identifying 
     underlicensed States.''.

  The SPEAKER pro tempore. Pursuant to the rule, the gentleman from 
Ohio (Mr. Chabot) and the gentlewoman from New York (Ms. Velazquez) 
each will control 20 minutes.
  The Chair recognizes the gentleman from Ohio.


                             General Leave

  Mr. CHABOT. Mr. Speaker, I ask unanimous consent that all Members may 
have 5 legislative days to revise and extend their remarks and include 
extraneous material on the bill under consideration.
  The SPEAKER pro tempore. Is there objection to the request of the 
gentleman from Ohio?
  There was no objection.
  Mr. CHABOT. Mr. Speaker, I yield myself such time as I may consume.
  Mr. Speaker, despite an improving lending environment, small 
businesses still face challenges financing their projects and their 
growth plans. Equity markets, which are regularly used by large 
businesses, often prove out of reach for the Nation's true job 
creators, small businesses.
  To bridge the equity gap that exists for small businesses, the SBA 
offers the Small Business Investment Company program, also known as the 
SBIC program. The program utilizes a privately owned, SBA-regulated and 
licensed model to deliver equity to the Nation's smallest businesses.
  While running at zero cost to the American taxpayer, the SBIC program 
creates a unique public-private partnership that translates into job 
expansion and job creation.
  In fiscal year 2017, SBIC financing supported more than 100,000 jobs 
all across the Nation--100,000 jobs, so this is an important program. 
However, the program can do more.
  With only about 300 SBICs currently operating in the United States, 
the program often does not geographically extend to those who truly 
need it the most. To address this problem, the gentlewoman from 
Washington (Mrs. McMorris Rodgers) introduced H.R. 4111, the Spurring 
Business in Communities Act of 2017, which expands the reach of the 
SBIC program by requiring the SBA to focus on areas that are 
underrepresented in the program as they review and license SBIC 
applications.
  I want to thank the gentlewoman for her leadership on this particular 
issue. She has definitely taken a very important and active role on it 
in looking for ways to expand the reach of the SBIC program.
  I urge my colleagues to vote ``yes'' on this commonsense reform 
within H.R. 4111, and I reserve the balance of my time.
  Ms. VELAZQUEZ. Mr. Speaker, I yield myself such time as I may 
consume.
  I rise in support of H.R. 4111, a bill that will improve access to 
the Small Business Investment Company program in underserved 
communities.
  SBICs have assisted thousands of high-growth companies over the years 
by ``filling the gap'' in the capital markets for businesses that have 
outgrown the SBA's 7(a) guaranteed loan program but remain too small or 
too risky for traditional private equity markets to bear.
  SBICs operate in a unique public-private partnership with SBA. Once 
managers raise enough private capital, the agency provides matching 
funds which are pooled together and invested in high-growth small 
businesses.
  To maximize the impact of the program, it is essential that SBIC 
licenses are processed in a timely fashion and also geographically 
spread across the country. As it stands now, nearly three-quarters of 
SBICs are located in just 10 States.
  Today's bill will address these points by prioritizing those license 
applications from managers that will invest in our underserved 
communities.
  The SBIC program has done a lot of good for the small business 
community over the years. Enabling SBA to fast-track more capital into 
the hands of small-business owners is a top priority for both sides of 
the aisle in this committee.
  I urge Members to support this legislation, and I reserve the balance 
of my time.
  Mr. CHABOT. Mr. Speaker, I yield such time as she may consume to the 
gentlewoman from Washington (Mrs. McMorris Rodgers), the principal 
sponsor of this legislation, who also has the number four ranking 
leadership role on the Republican side of the House.
  Mrs. McMORRIS RODGERS. Mr. Speaker, I thank the chairman for 
yielding, and I appreciate his leadership on all of these bills that 
are going to help our small businesses.
  I rise today in support of my legislation, the Spurring Business in 
Communities Act, which would encourage investment in small businesses 
through incentivizing small business investment companies, or SBICs, to 
form and invest in communities all across the country.
  Small businesses are the backbone of our community and our economy, 
providing two out of three new jobs in America. SBICs serve an 
important function in providing capital and support to startup 
businesses across the country and are a significant source of job 
creation. A 2017 Library of Congress study found that SBIC-backed small 
businesses created 3 million new jobs and supported an additional 6.5 
million.
  According to SBA's most recent report, SBICs reported nearly $1 
billion in financing during the fourth quarter of 2017 and created more 
than 16,000 jobs. Over the same period, SBICs were able to finance 210 
companies across the U.S., including 25 businesses in low- and 
moderate-income areas, and 12 businesses owned by women, minorities, or 
veterans.
  Many well-known companies have achieved success through support from 
SBICs, including Apple, Buffalo Wild Wings, Costco, and Staples.
  While SBICs invest broadly in businesses across the country, the 
location of the firms receiving SBA backing is not geographically 
diverse. Instead, SBICs are primarily located in larger urban and 
financial centers, which only further concentrates lending and 
investment activity. Washington, my home State, has none. In fact, 72 
percent of SBICs are located in 10 States.

                              {time}  1445

  This legislation will change that by easing the process for SBICs to 
form in underlicensed States like Washington, invest in people in our 
community, grow our local economy, and create jobs.
  This legislation would increase SBA's accountability to Congress and 
the public by exempting SBIC applicants from underlicensed States from 
the full capital requirements, give first priority to new applications 
from underlicensed or underfinanced States, and establish annual 
reporting requirements on SBA's progress to increase the geographical 
dispersement of SBICs.
  Last week was Small Business Week, an important reminder of the 
critical role small businesses play in our communities.
  The Small Business Investment Act of 1958 declares a mission to 
ensure the provision of Small Business Investment Company financing to 
all of the country. This legislation will help meet that mission by 
encouraging SBICs to form in the underlicensed areas and invest in all 
corners of the country, which is why I encourage my colleagues on both 
sides of the aisle to support the Spurring Business in Communities Act.
  Ms. VELAZQUEZ. Mr. Speaker, I yield back the balance of my time.
  Mr. CHABOT. Mr. Speaker, I yield myself such time as I may consume.
  Mr. Speaker, I would first like to recognize and thank Mrs. McMorris 
Rodgers for her leadership on this really very important issue which 
will make a big difference in various parts of our country in the area 
of small business development and job creation. The SBIC program 
continues to produce results for job creators and job seekers.
  To ensure the program reaches underserved areas, H.R. 4111, Mrs.

[[Page H3810]]

McMorris Rodgers' bill, institutes reforms to show how the SBA reviews 
and processes SBIC applications and to improve those. This legislation 
will grow the reach of a program that currently runs at zero cost to 
the American taxpayer, which is certainly a mark that we should all 
recognize and appreciate.
  Mr. Speaker, I want to thank Mrs. McMorris Rodgers for this important 
legislation.
  I urge my colleagues to support H.R. 4111, and I yield back the 
balance of my time.
  The SPEAKER pro tempore. The question is on the motion offered by the 
gentleman from Ohio (Mr. Chabot) that the House suspend the rules and 
pass the bill, H.R. 4111.
  The question was taken; and (two-thirds being in the affirmative) the 
rules were suspended and the bill was passed.
  A motion to reconsider was laid on the table.

                          ____________________