[House Report 116-702]
[From the U.S. Government Publishing Office]
Union Calendar No. 585
116th Congress } { Report
HOUSE OF REPRESENTATIVES
2d Session } { 116-702
_______________________________________________________________________
REPORT ON THE ACTIVITIES
of the
COMMITTEE ON SMALL BUSINESS
116TH CONGRESS
[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]
December 29, 2020.--Committed to the Committee of the Whole House on
the State of the Union and ordered to be printed
__________
U.S. GOVERNMENT PUBLISHING OFFICE
42-804 WASHINGTON : 2020
LETTER OF TRANSMITTAL
----------
House of Representatives,
Committee on Small Business,
Washington, DC, December 29, 2020.
Hon. Nancy Pelosi,
Speaker, House of Representatives,
Washington, DC.
Dear Speaker Pelosi: In accordance with Rule XI(1)(d)(1) of
the Rules of the House of Representatives, I respectfully
submit the activities report of the Committee on Small Business
for the 116th Congress.
Sincerely,
Nydia M. Velazquez,
Chairwoman.
C O N T E N T S
__________
Page
Letter of Transmittal............................................ III
Jurisdiction of the Committee.................................... 1
Rules of the Committee........................................... 1
Membership and Organization of the Committee..................... 15
Authorization and Oversight Plan................................. 17
Legislative Activities........................................... 25
Oversight Summary................................................ 63
Part A--Full Committee Hearings.................................. 63
Part B--Subcommittee Hearings.................................... 97
Part C--Waste, Fraud, Abuse, and Mismanagement................... 131
Part D--Implementation of Oversight Plan......................... 135
Union Calendar No. 585
116th Congress Report
HOUSE OF REPRESENTATIVES
2d Session 116-702
======================================================================
REPORT ON THE ACTIVITIES OF THE COMMITTEE ON SMALL BUSINESS FOR THE
116TH CONGRESS
_______
December 29, 2020.--Committed to the Committee of the Whole House on
the State of the Union and ordered to be printed
_______
Ms. Velazquez, from the Committee on Small Business,
submitted the following
R E P O R T
Clause 1(d) of rule XI of the Rules of the House of
Representatives for the 116th Congress requires that each
standing committee, not later than January 2nd of each odd-
numbered year, submit to the House a report on the activities
of that Committee, including separate sections summarizing the
legislative and oversight activities of that Committee.
JURISDICTION AND SPECIAL OVERSIGHT FUNCTION
Clause 1(q) of rule X of the Rules of the House of
Representatives of the 116th Congress sets forth the
jurisdiction of the Committee on Small Business as follows--
(1) Assistance to and protection of small business,
including financial aid, regulatory flexibility, and paperwork
reduction.
(2) Participation of small-business enterprises in Federal
procurement and Government contracts.
Clause 3(l) of rule X of the Rules of the House of
Representatives for the 116th Congress sets forth the Special
Oversight Function of the Committee on Small Business as
follows--
The Committee on Small Business shall study and investigate
on a continuing basis the problems of all types of small
business.
RULES OF THE COMMITTEE ON SMALL BUSINESS
ONE HUNDRED SIXTEENTH CONGRESS
1. GENERAL PROVISIONS
(A) Rules of the Committee. The Rules of the House of
Representatives, in total (but especially with respect to the
operations of committees Rule X, cl. 1(q), cl. 2, cl. 3(l), and
Rule XI), are the rules of the Committee on Small Business
(``Committee'') to the extent applicable and are incorporated
by reference.
(B) Appointments by the Chair. Pursuant to the Rules of the
House, the Chair shall designate a Member of the Committee
Majority to serve as Vice Chair of the Committee. The Vice
Chair shall preside at any meeting or hearing during the
temporary absence of the Chair. The Chair also reserves the
right to designate a Member of the Committee Majority to serve
as the Chair at a hearing or meeting.
2. REFERRAL OF BILLS BY THE CHAIR
(A) The Chair will retain consideration of all legislation
referred to the Committee by the Speaker. No action will be
required of a Subcommittee before legislation is considered for
report by the Committee. Subcommittee chairs, pursuant to the
rules set out herein, may hold hearings on any bill referred to
the Committee.
3. SUBCOMMITTEES
(A) Generally. Each Subcommittee of the Committee is part
of the Committee and is subject to the authority and direction
of the Committee, and to the Rules of the House and the rules
adopted herein, to the extent applicable. The Chairman and
Ranking Member of the Committee are ex officio Members of all
Subcommittees for the purpose of any meeting conducted by a
Subcommittee.
(B) The Committee shall be organized into the following
five subcommittees:
(1) Subcommittee on Rural Development, Agriculture,
Trade, and Entrepreneurship
This Subcommittee (which will consist of six (6)
Democratic Members and four (4) Republican Members)
will address policies that enhance rural economic
growth, increasing America's energy independence and
ensuring that America's small businesses can compete
effectively in a global marketplace.
Oversight of agricultural policies.
Oversight of environmental issues and
regulations (including agencies such as the
Environmental Protection Agency and the Army Corps of
Engineers).
Oversight of energy issues, including
expansion of domestic resources, whether they are
renewable or non-renewable.
Oversight of international trade policy with
particular emphasis on agencies that provide direct
assistance to small businesses, such as: the Small
Business Administration's (SBA) Office of International
Trade, the Department of Commerce's United States
Export Assistance Centers, the Department of
Agriculture's Foreign Agricultural Service, and the
Export-Import Bank.
Oversight of infringement of intellectual
property rights by foreign competition.
Oversight of SBA entrepreneurial development
programs, including Small Business Development Centers,
Women's Business Centers, Veteran Business Outreach
Centers, and SCORE.
(2) Subcommittee on Innovation and Workforce
Development
This Subcommittee (which will consist of six (6)
Democratic Members and four (4) Republican Members)
will address how innovation promotes economic growth
and job creation by small businesses. In addition, the
Subcommittee will examine small business job growth
through the creation and adoption of advanced
technologies. The Subcommittee will review the broad
scope of workforce issues that affect the ability of
small businesses to obtain and maintain qualified
employees.
Oversight of all federal policies that
affect the workforce including, but not limited to, the
roles of the Department of Labor and the National Labor
Relations Board.
Oversight of workforce issues, including but
not limited to health care, retirement, and labor
challenges facing small businesses.
Oversight of general technology issues,
including intellectual property policy in the United
States.
Oversight of United States
telecommunications policies including, but not limited
to, the National Broadband Plan and allocation of
electromagnetic spectrum.
Oversight of the Small Business Innovation
Research Program.
Oversight of the Small Business Technology
Transfer Program.
(3) Subcommittee on Economic Growth, Tax, and Capital
Access
This Subcommittee (which will consist of six (6)
Democratic Members and four (4) Republican Members)
will evaluate the operation of the financial markets in
the United States and their ability to provide needed
capital to small businesses. In addition, the
Subcommittee will review federal programs, especially
those overseen by the SBA, aimed at assisting
entrepreneurs in obtaining needed capital. Since the
tax policy plays an integral role in access to capital,
this Committee also will examine the impact of federal
tax policies on small businesses.
Oversight of capital access and financial
markets.
Implementation of the Dodd-Frank Wall Street
Reform and Consumer Protection Act.
SBA financial assistance programs, including
guaranteed loans, microloans, certified development
company loans, and small business investment companies.
Oversight of the Department of Agriculture
business and industry guaranteed loan program.
Oversight of general tax policy affecting
small businesses.
The management of the SBA disaster loan
program.
(4) Subcommittee on Investigations, Oversight, and
Regulations
This Subcommittee (which will consist of six (6)
Democratic Members and four (4) Republican Members)
will probe the efficient operation of government
programs that affect small businesses, including the
SBA, and develop proposals to make them operate in a
more cost-effective manner. This Subcommittee also will
review the regulatory burdens imposed on small
businesses and how those burdens may be alleviated.
Oversight of general issues affecting small
businesses and federal agencies.
Oversight of the management of the SBA.
Oversight of the SBA Inspector General.
Implementation of the Regulatory Flexibility
Act.
Oversight of the Office of Information and
Regulatory Affairs at the Office of Management and
Budget.
Use of the Congressional Review Act.
Transparency of the federal rulemaking
process as required by the Administrative Procedure and
Data Quality Acts.
Implementation of the Paperwork Reduction
Act.
(5) Subcommittee on Contracting and Infrastructure
This Subcommittee (which will consist of six (6)
Democratic Members and four (4) Republican Members)
will assess the federal procurement system, including
those programs designed specifically to enhance
participation by small businesses in providing goods
and services to the federal government. The
Subcommittee will review the broad scope of
opportunities available to small businesses for
rebuilding and modernizing the nations' infrastructure.
Oversight of government-wide procurement
practices and programs affecting small businesses.
Oversight of federal procurement policies
that inhibit or expand participation by small
businesses in the federal contracting marketplace.
All contracting programs established by the
Small Business Act, including HUBZone, 8(a), Women-,
and Service Disabled Veteran-Owned Small Business
Programs.
Technical assistance provided to federal
contractors and prospective contractors through SBA
personnel, Offices of Small and Disadvantaged Business
Utilization, and Procurement Technical Assistance
Centers.
The SBA Surety Bond guarantee program.
General oversight of programs available to
small businesses in modernizing and strengthening the
nation's infrastructure.
(C) Powers and Duties of Subcommittees. Each Subcommittee
is authorized to meet, hold hearings, receive evidence, and
report to the Committee on any matters referred to it. Prior to
the scheduling of any meeting or hearing of a Subcommittee, the
Chair of the Subcommittee shall obtain the approval of the
Chair of the Committee.
(D) Hearing Time and Date. No hearing or meeting of a
Subcommittee shall take place at the same time as the meeting
or hearing of the full Committee or another Subcommittee,
provided however, that the Subcommittee Chairs may hold field
hearings that conflict with those held by other Subcommittees
of the Committee.
4. COMMITTEE STAFF
(A) Majority Staff. The employees of the Committee, except
those assigned to the Minority as provided below, shall be
appointed and assigned, and may be removed by the Chair of the
Committee. The Chair shall fix their remuneration and they
shall be under the general supervision and direction of the
Chair.
(B) Minority Staff. The employees of the Committee assigned
to the Minority shall be appointed and assigned, and their
remuneration determined, as the Ranking Minority Member of the
Committee shall decide.
(C) Subcommittee Staff. There shall be no separate staff
assigned to Subcommittees. The Chair and Ranking Minority
Member shall endeavor to ensure that sufficient Committee staff
is made available in order that each Subcommittee may carry out
the responsibilities set forth in Rule 3, supra.
5. MEETINGS
(A) Regular Meetings. The regular meeting day of the
Committee shall be the second Wednesday of every month when the
House is in session. The Chair may dispense with the meeting of
the Committee, if in the sole discretion of the Chair, there is
no need for such meeting.
(B) Additional Meetings. Additional meetings may be called
as deemed necessary by the Chair or at the request of the
majority Members of the Committee pursuant to Rule XI, cl. 2(c)
of the rules of the House. At least 3 days' notice, pursuant to
Rule XI, cl. 2(g)(3)(A), of such an additional meeting shall be
given unless the Chair, with the concurrence of the Ranking
Minority Member, determines that there is good cause to call
the meeting on less notice or upon a vote by a majority of the
Committee (a quorum being present). Announcements of the
meeting shall be published promptly in the Daily Digest and
made publicly available in electronic form.
(C) Business to be Considered. The determination of the
business to be considered at each meeting shall be made by the
Chair subject to limitations set forth in House Rule XI, cl.
2(c).
(D) Meeting Materials. The Chair shall provide to each
Member of the Committee, to the extent practicable, at least 48
hours in advance of a meeting, a copy of the bill, resolution,
report or other item to be considered at the meeting, but no
later than 24 hours before the meeting. Such material also
shall be made available to the public at least 24 hours in
advance in electronic form.
(E) Special and Emergency Meetings. The rules for notice
and meetings as set forth in Rule 5 of these Rules shall not
apply to special and emergency meetings. Clause 2(c)(2) of Rule
XI and clause 2(g)(3)(A) of Rule XI of the Rules of the House,
as applicable, shall apply to such meetings.
6. NOTICE AND ANNOUNCEMENT OF HEARINGS
(A) Announcement of Hearings. Public announcement of the
date, place, and subject matter of any hearing to be conducted
by the Committee shall be made no later than seven (7) calendar
days before the commencement of the hearing. To the extent
possible, the seven days shall be counted from 168 hours before
the time of the Committee's hearing.
(B) Exception. The Chair, with the concurrence of the
Ranking Minority Member, or upon a vote by the majority of the
Committee (a quorum being present), may authorize a hearing to
commence on less than 7 days' notice.
(C) Witness Lists. Unless the Chair determines it is
impracticable to do so, the Committee shall make a tentative
witness list available at the time it makes the public
announcement of the hearing. If a tentative witness list is not
made available at the time of the announcement of the hearing,
such witness list shall be made available as soon as
practicable after such announcement is made. A final witness
list shall be issued by the Committee no later than 48 hours
prior to the commencement of the hearing.
(D) Hearing Material. The Chair shall provide to all
Members of the Committee, as soon as practicable after the
announcement of the hearing, a memorandum explaining the
subject matter of the hearing and any official reports from
departments and agencies on the subject matter of the hearing.
Such material shall be made available to all Members of the
Committee no later than 48 hours before the commencement of the
hearing, unless the Chair, after consultation with the Ranking
Minority Member, determines that certain reports from
departments or agencies should not be made available prior to
the commencement of the hearing. Material provided by the Chair
to all Members, whether provided prior to or at the hearing,
shall be placed on the Committee website no later than 48 hours
after the commencement of the hearing, unless such material
contains sensitive or classified information, in which case
such material shall be handled pursuant to Rule 16 of the
Committee's Rules.
7. MEETINGS AND HEARINGS OPEN TO THE PUBLIC
(A) Meetings. Each meeting of the Committee or its
Subcommittees for the transaction of business, including the
markup of legislation, shall be open to the public, including
to radio, television, and still photography coverage, except as
provided by House Rule XI, cl. 4. If the majority of Members of
the Committee or Subcommittee present at the meeting determine
by a recorded vote in open session that all or part of the
remainder of the meeting on that day shall be closed to the
public because the disclosure of matters to be considered would
endanger national security, would compromise sensitive law
enforcement information, or would tend to defame, degrade, or
incriminate any person or otherwise would violate any law or
rule of the House; provided however, that no person other than
Members of the Committee, and such congressional staff and such
executive branch representatives they may authorize, shall be
present in any meeting which has been closed to the public.
(B) Hearings. Each hearing conducted by the Committee or
its Subcommittees shall be open to the public, including radio,
television and still photography coverage. If the majority of
Members of the Committee or Subcommittee present at the hearing
determine by a recorded vote in open session that all or part
of the remainder of the hearing on that day shall be closed to
the public because the disclosure of matters to be considered
would endanger national security, would compromise sensitive
law enforcement information, or would tend to defame, degrade,
or incriminate any person or otherwise would violate any law or
rule of the House; provided however, that the Committee or
Subcommittee may by the same procedure also vote to close one
subsequent day of hearings. Notwithstanding the requirements of
the preceding sentence, a majority of those present (if the
requisite number of Members are present under Committee rules
for the purpose of taking testimony) may vote: (i) to close the
hearing for the sole purpose of discussing whether the
testimony or evidence to be received would endanger the
national security, would compromise sensitive law enforcement
information, or violate Rule XI, cl. 2(k)(5) of the House or
(ii) to close the hearing, as provided clause 2(k)(5) of Rule
XI of the House.
(C) Participation in Subcommittee Hearings. The Chair and
Ranking Minority Member are ex officio Members of all
Subcommittees for any hearing conducted by a Subcommittee.
Members of the Committee who wish to participate in a hearing
of the Subcommittee to which they are not Members shall make
such request to the Chair and the Ranking Minority Member of
the Subcommittee at the commencement of the hearing. The Chair,
after consultation with the Ranking Minority Member of the
Subcommittee, shall grant such request.
(D) Non-Participatory Attendance by Other Members of the
House. No Member of the House may be excluded from non-
participatory attendance at any hearing of the Committee or any
Subcommittee, unless the House of Representatives shall by
majority vote authorize the Committee or Subcommittees, for
purposes of a particular subject of investigation, to close its
hearing to Members by the same procedures designated to close
hearings to the public.
(E) Procedure to Participate. Members of Congress who are
not Members of the Committee but would like to participate in a
hearing shall notify the Chair and the Ranking Minority Member
and submit a formal request no later than 24 hours before the
commencement of the meeting or hearing. Such Member may not
vote on any matter; be counted for the purpose of establishing
a quorum; participate in questioning a witness under the 5-
Minute rule, unless permitted to do so by the Chair in
consultation with the Ranking Minority Member; raise points of
order; or offer amendments or motions.
(F) Audio and Video Coverage. To the maximum extent
practicable, the Committee shall provide audio and video
coverage of each hearing or meeting for the transaction of
business in a manner that allows the public to easily listen
and view the proceedings and shall maintain the recordings of
such coverage in a manner easily accessible to the public.
Operation and use of any Committee internet broadcast system
shall be fair and nonpartisan, and in accordance with clauses 4
(b) and (f) of House Rule XI and all other applicable rules of
the Committee and the House.
8. WITNESSES
(A) Number of Witnesses. For any hearing conducted by the
Committee or Subcommittee there shall be no more than four non-
governmental witnesses of which the Ranking Minority Member of
the Committee or Subcommittee (as appropriate) is entitled to
select one witness for the hearing.
(B) Witnesses Selected by the Minority. Witnesses selected
by the Ranking Minority Member of the Committee or Subcommittee
shall be invited to testify by the Chair of the Committee or
Subcommittee (as appropriate). Rule 6(A) shall apply with equal
force to witnesses selected by the Ranking Minority Member of
the Committee or Subcommittee.
(C) Small Business Week Exception. The limitations set
forth in the preceding paragraph shall not apply if the
Committee holds a hearing to honor the work of the small
business community in conjunction with the annual celebration
of Small Business Week. Witness limitations for such a hearing
shall be determined by the Chair in consultation with the
Ranking Minority Member.
(D) Statement of Witnesses.
(1) Insofar as is practicable, each witness who is to
appear before the Committee or Subcommittee shall file
an electronic copy of the written testimony with the
Committee and the Ranking Minority Member no later than
48 hours before the commencement of the hearing. In
addition, the witness shall provide 25 copies of the
written testimony by the commencement of the hearing.
The Chair may waive the requirement by the witness
providing 25 copies in which case the Committee or
Subcommittee shall provide the 25 copies.
(2) Each witness shall limit his or her oral
presentation to a five-minute summary of the written
testimony, unless the Chair in consultation with the
Ranking Minority Member extends this time period.
(3) Insofar as is practicable, each non-governmental
witness shall provide to the Committee and the Ranking
Minority Member, no later than 48 hours before the
commencement of the hearing, a curriculum vitae or
other statement describing their education, employment,
professional affiliation or other background
information pertinent to their testimony.
(E) Witness Disclosure. As required by Rule XI, cl. 2(g) of
the Rules of the House, each non-governmental witness before
the commencement of the hearing shall file with the Chair a
disclosure form detailing any contracts or grants that the
witness has with the federal government, as well as the amount
and country of origin of any payment or contract related to the
subject of the hearing originating with a foreign government.
Such information shall be posted on the Committee website
within 24 hours after the witness appeared at the hearing.
(F) Failure to Comply. The failure to provide the materials
set forth by the deadlines set forth in these rules may be
grounds for excluding both the oral and written testimony of
the witness unless waived by the Chair of the Committee or
Subcommittee.
(G) Public Access to Witness Materials. The Committee will
provide public access to printed materials, including the
testimony of witnesses in electronic form on the Committee's
website no later than 24 hours after the hearing is adjourned.
Supplemental material provided after the hearing adjourns shall
be placed on the Committee website no later than 24 hours after
receipt of such material.
(H) Questioning of Witnesses. Except when the Committee
adopts a motion pursuant to subdivisions (B) and (C) of clause
2(i)(2) of Rule XI of the Rules of the House, Committee Members
may question witnesses only when they have been recognized by
the Chair for that purpose. Members shall have the opportunity,
as set forth in Rule XI, cl. 2 (j) of the Rules of the House,
to question each witness on the panel for a period not to
exceed five minutes. For any hearing, the Chair of the
Committee or Subcommittee may offer a motion to extend the
questioning of a witness or witnesses by the Member identified
in the motion for more than five minutes as set forth in Rule
XI, cl. 2(j)(B). No Member may be recognized for a second
period of interrogation, subject to the 5-minute rule, until
each Member present, who wishes to be recognized, has been
recognized at least once.
(I) Order of Questioning. The Chair of the Committee or
Subcommittee shall commence questioning followed by the Ranking
Minority Member. Thereafter, questioning shall alternate
between the majority and minority Members. Before the gavel has
been struck, or in the case of Members arriving simultaneously,
the order of questioning shall be based on seniority among
Members of his or her own party. After the gavel has been
struck, Members first to arrive shall have priority over
Members of his or her own party. Members of Congress who are
not Members of the Committee, if allowed by the Chair, may be
recognized for questioning of witnesses but only after all
Committee Members have first been recognized.
(J) Consideration of Ratio. In recognizing Members to
question witnesses, the Chair may take into consideration the
ratio of majority and minority Members present in such a manner
as to not disadvantage the Members of either party.
9. QUORUM
(A) Determining a Quorum. A quorum, for purposes of
reporting a measure or recommendation, shall be a majority of
the Committee Members.
(B) Quorum for a Hearing. For purposes of taking testimony
or receiving evidence, a quorum shall be one Member from the
Majority and one Member from the Minority. The Chair of the
Committee or Subcommittee shall exercise reasonable comity by
waiting for the Ranking Minority Member even if a quorum is
present before striking the gavel to commence the hearing. For
hearings held by the Committee or a Subcommittee in a location
other than the Committee's hearing room in Washington, DC, a
quorum shall be deemed to be present if the Chair of the
Committee or Subcommittee is present.
10. RECORD VOTES
(A) When Provided. A record vote of the Committee shall be
provided on any question before the Committee upon the request
of any Member of the Committee. A record of the vote of each
Member of the Committee on a matter before the Committee shall
be available in electronic form within 48 hours of such record
vote, and, with respect to any roll call vote on any motion to
amend or report, shall be included in the report of the
Committee showing the total number of votes cast for and
against and the names of those Members voting for and against.
(B) Proxy Voting. No vote by any member of the Committee
with respect to any measure or matter may be cast by proxy.
(C) Public Access to Record Votes. The Chair of the
Committee shall, not later than 24 hours after consideration of
a bill, resolution, report or other item, cause the text of the
reported item and any amendment adopted thereto to be made
publicly available in electronic form.
11. SUBPOENAS
(A) Authorization and Issuance. A subpoena may be
authorized and issued by the Committee in the conduct of any
investigation or series of investigations or activities to
require the attendance and testimony of such witness and the
production of such books, records, correspondence, memoranda,
papers and documents, as deemed necessary. Such subpoena shall
be authorized by a majority of the full Committee. The
requirement that the authorization of a subpoena require a
majority vote may be waived by the Ranking Minority Member of
the Committee.
(B) Issuance During Congressional Recess. The Chair may
issue a subpoena, in consultation with the Ranking Minority
Member, when the House is out for session for more than three
legislative days.
12. AMENDMENTS DURING MARKUP
(A) Availability of Amendments. Any amendment offered to
any pending legislation before the Committee must be made
available in written form by any Member of the Committee. If
such amendment is not available in written form when requested,
the Chair shall allow an appropriate period for the provision
thereof and may adjourn the markup to provide sufficient time
for the provision of such written amendment. Such period or
adjournment shall not prejudice the offering of such amendment.
(B) Drafting and Filing of Amendments. For amendments to be
accepted during markup, there is no requirement that the
amendments be filed prior to commencement of the markup or
prepared with the assistance of the Office of Legislative
Counsel. Even though it is not necessary, Members seeking to
amend legislation during markup should draft amendments with
the assistance of the Office of Legislative Counsel and consult
with the Chair or Ranking Minority Member's staff (as
appropriate) in the preparation of such amendments.
13. POSTPONEMENT OF PROCEEDINGS
(A) When Postponement is Permissible. The Chair, in
consultation with the Ranking Minority Member, may postpone
further proceedings when a record vote is ordered on the
question of approving any measure or matter or adopting an
amendment. The Chair may resume postponed proceedings, but no
later than 24 hours after such postponement, unless the House
is not in session or there are conflicts with Member schedules
that make it unlikely a quorum will be present to conduct
business on the postponed proceeding. In such cases, the Chair
will consult with Members to set a time as early as possible to
resume proceedings but in no event later than the next meeting
date as set forth in Rule 5 of these Rules.
(B) Resumption of Proceedings. When proceedings resume on a
postponed question, notwithstanding any intervening order for
the previous question, an underlying proposition shall remain
subject to further debate or amendment to the same extent as
when the question was postponed.
14. COMMITTEE RECORDS
(A) The Committee shall keep a complete record of all
actions, which shall include a record of the votes on any
question on which a recorded vote is demanded. The result of
any vote by the Committee, or if applicable by a Subcommittee,
including a voice vote shall be posted on the Committee's
website within 24 hours after the vote has been taken. Such
record shall include a description of the amendment, motion,
order, or other proposition, the name of the Member voting for
and against such amendment, motion, order, or other
proposition, and the names of Members present but not voting.
For any amendment, motion, order, or other proposition decided
by voice vote, the record shall include a description and
whether the voice vote was in favor or against.
(B) Transcripts. The Committee shall keep a complete record
of all Committee and Subcommittee activity which, in the case
of a meeting or hearing transcript, shall include a
substantially verbatim account of the remarks actually made
during the proceedings subject only to technical, grammatical,
and typographical corrections authorized by the person making
the remarks.
(C) Availability of Records. The records of the Committee
at the National Archives and Records Administration shall be
made available in accordance with Rule VII of the Rules of the
House. The Chair of the Committee shall notify the Ranking
Member of the Committee of any decision, pursuant to Rule VII,
cl. 3(b)(3) or cl. 4 (b), to withhold a record otherwise
available, and the matter shall be presented to the Committee
for a determination of the written request of any Member of the
Committee.
(D) Publishing and Posting of Records. The Committee Rules
shall be made publicly available in electronic form and
published in the Congressional Record not later than 60 days
after the Chair of the Committee is elected in each odd-
numbered year.
15. COMMITTEE WEBSITE
(A) The Chair shall maintain an official Committee website
for the purpose of furthering the Committee's legislative and
oversight responsibilities, including communicating information
about Committee's activities to Committee Members and other
Members of the House. The Ranking Minority Member may maintain
a similar website for the same purpose, including communicating
information about the activities of the Minority to Committee
Members and other Members of the House.
16. ACCESS TO CLASSIFIED OR SENSITIVE INFORMATION
(A) Access to classified or sensitive information supplied
to the Committee or Subcommittees and attendance at closed
sessions of the Committee or a Subcommittee shall be limited to
Members and necessary Committee staff and stenographic
reporters who have appropriate security clearance when the
Chair determines that such access or attendance is essential to
the functioning of the Committee or one of its Subcommittees.
(B) Procedures Governing Availability. The procedures to be
followed in granting access to those hearings, records, data,
charts, and files of the Committee which involve classified
information or information deemed to be sensitive shall be as
follows:
(1) Only Members of the House of Representatives and
specifically designated Committee staff of the
Committee on Small Business may have access to such
information.
(2) Members who desire to read materials that are in
possession of the Committee shall notify the Clerk of
the Committee in writing.
(3) The Clerk of the Committee will maintain an
accurate access log, which identifies the circumstances
surrounding access to the information, without
revealing the material examined.
(4) If the material desired to be reviewed is
material which the Committee or Subcommittee deems to
be sensitive enough to require special handling, before
receiving access to such information, individuals will
be required to sign an access information sheet
acknowledging such access and that the individual has
read and understands the procedures under which access
is being granted.
(5) Material provided for review under this rule
shall not be removed from a specified room within the
Committee offices.
(6) Individuals reviewing materials under this rule
shall make certain that the materials are returned to
the proper custodian.
(7) No reproductions or recordings may be made of any
portion of such materials.
(8) The contents of such information shall not be
divulged to any person in any way, form, shape, or
manner and shall not be discussed with any person who
has not received the information in the manner
authorized by the rules of the Committee.
(9) When not being examined in the manner described
herein, such information will be kept in secure safes
or locked file cabinets within the Committee offices.
(10) These procedures only address access to
information the Committee or Subcommittee deems to be
sensitive enough to require special treatment.
(11) If a Member of the House of Representatives
believes that certain sensitive information should not
be restricted as to dissemination or use, the Member
may petition the Committee or Subcommittee to so rule.
With respect to information and materials provided to
the Committee by the Executive Branch or an independent
agency as that term is defined in 44 U.S.C. Sec. 3502,
the classification of information and materials as
determined by the Executive Branch or independent
agency shall prevail unless affirmatively changed by
the Committee or Subcommittee involved, after
consultation with the Executive Branch or independent
agency.
(12) Other materials in the possession of the
Committee are to be handled in the accordance with
normal practices and traditions of the Committee.
17. OTHER PROCEDURES
(A) The Chair of the Committee may establish such other
procedures and take such actions as may be necessary to carry
out the foregoing rules or to facilitate the effective
operation of the Committee.
18. AMENDMENTS TO COMMITTEE RULES
(A) The rules of the Committee may be modified, amended, or
repealed by a majority vote of the Members, at a meeting
specifically called for such purpose, but only if written
notice of the proposed change or changes has been provided to
each Member of the Committee at least 72 hours prior to the
time of the meeting of the Committee to consider such change or
changes.
19. BUDGET AND TRAVEL
(A) Allocation of Budget. From the amount provided to the
Committee in the primary expense resolution adopted by the
House of Representatives in the 116th Congress, the Chair,
after consultation with the Ranking Minority Member, shall
designate one-third of the budget under the direction of the
Ranking Minority Member for the purposes of minority staff,
travel expenses of minority staff and Members, and minority
office expenses.
(B) Authorization of Travel. The Chair may authorize travel
in connection with activities or subject matters under the
legislative or oversight jurisdiction of the Committee as set
forth in Rule X of the Rules of the House. The Ranking Minority
Member may authorize travel for any Minority Member or staff of
the minority in connection with activities or subject matters
under the Committee's jurisdiction as set forth in Rule X of
the Rules of the House. Before such travel, there shall be
submitted to the Chair of the Committee in writing the
following at least seven (7) calendar days prior specifying: a)
the purpose of the travel; b) the dates during which the travel
is to occur; c) the names of the states or countries to be
visited and the length of time spent in each; and d) the names
of Members and staff of the Committee participating in such
travel.
MEMBERSHIP AND ORGANIZATION
OF THE
COMMITTEE ON SMALL BUSINESS
ONE HUNDRED SIXTEENTH CONGRESS
Committee on Small Business
(Ratio: 14-10)
Nydia Velazquez, New York, Chairwoman
Republicans Democrats
Steve Chabot, Ohio, Ranking Member Abby Finkenauer, Iowa
Aumua Amata Coleman Radewagen, American Samoa, Vice Ranking Member
Troy Balderson, Ohio Andy Kim, New Jersey
Kevin Hern, Oklahoma Jason Crow, Colorado
Jim Hagedorn, Minnesota Sharice Davids, Kansas
Pete Stauber, Minnesota Kweisi Mfume, Maryland
Tim Burchett, Tennessee Judy Chu, California
Ross Spano, Florida Dwight Evans, Pennsylvania, Vice
John Joyce, Pennsylvania Chair
Dan Bishop, North Carolina Brad Schneider, Illinois
Adriano Espaillat, New York
Antonio Delgado, New York
Chrissy Houlahan, Pennsylvania
Angie Craig, Minnesota
----------
February 26, 2019--Ms. Angie Craig, Minnesota, was elected to the
Committee, H. Res. 148.
September 25, 2019--Mr. Trent Kelly, Mississippi, resigned from the
Committee.
September 26, 2019--Mr. Dan Bishop, North Carolina, was elected to the
Committee, H. Res. 596.
May 7, 2020--Mr. Marc Veasey, Texas, resigned from the Committee.
May 8, 2020--Mr. Kweisi Mfume, Maryland, was elected to the Committee,
H. Res. 954.
SUBCOMMITTEE MEMBERSHIPS
Subcommittee on Rural Development, Agriculture, Trade, and
Entrepreneurship
Abby Finkenauer, Iowa, Chairwoman
John Joyce, Pennsylvania, Ranking Membered Golden, Maine
Aumua Amata Coleman Radewagen, American Samoaow, Colorado
Jim Hagedorn, Minnesota Angie Craig, Minnesota
Dan Bishop, North Carolina Nydia Velazquez, New York [Ex
Steve Chabot, Ohio [Ex Officio] Officio]
Subcommittee on Innovation and Workforce Development
Jason Crow, Colorado, Chairman
Troy Balderson, Ohio, Ranking Member Chrissy Houlahan, Pennsylvania
Tim Burchett, Tennessee Abby Finkenauer, Iowa
Kevin Hern, Oklahoma Andy Kim, New Jersey
John Joyce, Pennsylvania Sharice Davids, Kansas
Steve Chabot, Ohio [Ex Officio] Nydia Velazquez, New York [Ex
Officio]
Subcommittee on Economic Growth, Tax, and Capital Access
Andy Kim, New Jersey, Chairman
Kevin Hern, Oklahoma, Ranking Member Sharice Davids, Kansas
Ross Spano, Florida Brad Schneider, Illinois
Aumua Amata Coleman Radewagen, American SamoaEspaillat, New York
Pete Stauber, Minnesota Antonio Delgado, New York
Steve Chabot, Ohio [Ex Officio] Jason Crow, Colorado
Nydia Velazquez, New York [Ex
Officio]
Subcommittee on Investigations, Oversight, and Regulations
Judy Chu, California, Chairwoman
Ross Spano, Florida, Ranking Member Dwight Evans, Pennsylvania
Tim Burchett, Tennessee Angie Craig, Minnesota
Steve Chabot, Ohio [Ex Officio] Nydia Velazquez, New York [Ex
Officio]
Subcommittee on Contracting and Infrastructure
Jared Golden, Maine, Chairman
Pete Stauber, Minnesota, Ranking Memberdy Chu, California
Jim Hagedorn, Minnesota Nydia Velazquez, New York [Ex
Troy Balderson, Ohio Officio]
Steve Chabot, Ohio [Ex Officio]
AUTHORIZATION AND OVERSIGHT PLAN OF THE COMMITTEE ON SMALL BUSINESS
ONE HUNDRED SIXTEENTH CONGRESS
Ms. Velazquez, from the Committee on Small Business,
submitted to the Committee on Oversight and Reform and the
Committee on House Administration the following:
REPORT
Rule X, cl. 2(d)(1) of the Rules of the House requires each
standing Committee to adopt an oversight plan for the two-year
period of the Congress and to submit the plan to the Committees
on Oversight and Reform and House Administration not later than
March 1 of the first session of the Congress. Under Rule X, the
Committee has oversight authority to investigate and examine
any matter affecting small business. This Report reflects that
broad oversight jurisdiction.
OVERSIGHT OF FEDERAL CAPITAL ACCESS PROGRAMS
The Committee will conduct hearings and investigations into
Small Business Administration (SBA) and other federal agencies
that provide capital to America's entrepreneurs that may
include any or all of the following, as well as matters brought
to the attention of the Committee subsequent to the filing of
this Report:
Effectiveness of the capital access programs
to generate jobs in the fastest growing small
businesses.
Whether lenders are meeting their goals to
lend to small businesses and create jobs.
Adequacy of SBA oversight of its lending
partners to ensure that federal taxpayers are properly
protected.
Capabilities of the SBA information
technology to manage the loan portfolio.
Whether SBA rules, regulations, and guidance
result in transparent and reasoned decision making with
respect to capital access programs.
Assessment of credit-scoring algorithms as a
replacement for individual credit assessment by SBA and
its lending partners.
The exercise of discretion by SBA to create
pilot programs and the risk they pose to the taxpayer
and whether such authority should be curtailed or
eliminated.
Whether SBA disaster loan program and its
oversight ensure that small businesses are able to
revive and rebuild communities.
Review the recent change by SBA for fee
waivers and the impact moving from a dollar limitation
to a geographic determination will have on small
businesses.
Efficacy and duplication of federal capital
access programs offered by the Department of
Agriculture to small businesses in rural areas.
Utilization by small businesses of export
capital programs at the Export-Import Bank and the
Overseas Private Investment Corporation.
Study the need to enhance the 7(a) and
Certified Development Company programs so that they are
more effective in reaching borrowers unable to secure
conventional loans.
Analyze the Microloan program with the
intent of making it more affordable for borrowers and
reducing barriers to its growth.
Examine methods to enhance equity financing
to meet the needs of small business borrowers wherein
debt financing is not appropriate and how SBA programs
may be used to increase equity financing.
Continued examination of the Small Business
Lending Fund and State Small Business Credit Initiative
established by Pub. L. No. 111-240, the Small Business
Jobs Act of 2010, in creating jobs and providing
capital to small businesses.
Implementation of crowdfunding and other
provisions of the Jumpstart Our Business Startups Act,
Pub. L. No. 112-106.
Continued oversight and analysis of the role
that the SBA secondary market plays in small business
finance and the effectiveness of changes made by SBA to
the pooling program established in the Federal Register
Notice of October 16, 2017.
Review and oversight into the Master Reserve
Fund at SBA.
Implementation of program clarifications
made to encourage more cooperative and employee stock
ownership plan lending through SBA programs established
by the Main Street Employee Ownership Act of 2018,
passed into law by the John S. McCain National Defense
Authorization Act for Fiscal Year 2019, Pub. L. No.
115-232.
Implementation of changes made to increase
oversight of the 7(a) loan program established by Pub.
L. No. 115-189, the Small Business 7(a) Lending
Oversight Reform Act of 2018.
Examination of the Express Bridge Loan Pilot
Program for disaster recovery lending for small
businesses and its performance after recent disasters,
such as Hurricanes Harvey, Irma, and Maria and numerous
wildfires.
Investigate franchising contracts to learn
how SBA loans are being utilized, default rates, and
whether small business owners are being harmed in case
improvements in the SBA franchise directory can be
made.
The effectiveness of SBA in minimizing risk
to the taxpayer in the SBA capital access programs.
In performing oversight, the Committee will focus on
particularly risky aspects of financial assistance programs
including, but not limited to, commercial real estate
refinancing, premier certified lenders, participating security
small business investment companies, small business lending
companies, express lenders, and loan programs utilizing
simplified lending applications.
OVERSIGHT OF SBA AND OTHER FEDERAL ENTREPRENEURIAL DEVELOPMENT PROGRAMS
The Committee will conduct hearings and investigations into
the SBA programs that provide training and advice to small
businesses that may include any or all of the following, as
well as matters brought to the attention of the Committee
subsequent to the filing of this Report:
Examining effectiveness of SBA
entrepreneurial development programs in creating jobs
at startups and traditional firms.
Suggesting methods for enhancing
coordination among federal agencies in aiding
entrepreneurs, including, but not limited to,
businesses located in underserved areas, such as rural
and low-income communities and those seeking to provide
goods and services in the federal procurement
marketplace.
Enhancing the efficacy and utilization of
the Manufacturing Extension Partnership at the
Department of Commerce, including developments in
renewable energy.
OVERSIGHT OF FEDERAL GOVERNMENT CONTRACTING MATTERS
The Committee will conduct hearings and investigations into
the federal procurement system that may include any or all of
the following, as well as matters brought to the attention of
the Committee subsequent to the filing of this Report:
Whether fraud or other problems exist in the
federal government contracting programs overseen by the
SBA including the 8(a), HUBZone, service-disabled
veteran, women-owned contracting, and Small Business
Innovation Research programs.
Effectiveness of SBA contracting programs to
increase participation by small businesses in federal
procurement.
Effectiveness of federal agency protections
against contract bundling and consolidation.
The accuracy and utility of SBA size
standards and federal procurement databases.
Operation and effectiveness of federal
agency assistance provided to small businesses
interested in federal procurement, including that
provided by the SBA, Offices of Small and Disadvantaged
Business Utilization and Procurement Technical
Assistance Centers.
Development of federal acquisition policies
and whether small businesses have sufficiently
effective voice in development of such policies.
Cost-effectiveness of outsourcing government
work to private enterprise rather than expanding the
government to do provide the good or service internally
(i.e., government insourcing).
Implementation and efficacy of changes made
in small business federal procurement programs arising
from the enactment of the National Defense
Authorization Acts for FYs 2012-2019.
Examination of the Small Business Innovation
Research Program as modified by the National Defense
Authorization Act for FY 2012, Pub. L. No. 112-81,
including, but not limited to, increased efforts at
commercializing federally-funded technology.
Implementation and efficacy of changes made
to the Small Business Innovation Research Program
arising from the enactment of the John S. McCain
National Defense Authorization Act for Fiscal Year
2019, Pub. L. No. 115-232.
Implementation and efficacy of changes made
to the HUBZone program arising from the enactment of
the National Defense Authorization Act for Fiscal Year
2018, Pub. L. No. 115-91.
In performing oversight, the Committee will focus its
efforts on uncovering abuse and misuse of the small business
designation to obtain federal government contracts.
OVERSIGHT OF SBA MANAGEMENT
The Committee will conduct the hearings and investigations
into the management of the SBA that may include any or all of
the following, as well as matters brought to the attention of
the Committee subsequent to the filing of this Report:
The appropriate mission of the SBA.
Whether agency employees in the field are
empowered to assist small businesses.
Duplication of offices and missions at SBA
headquarters.
Effectiveness of personnel management to
ensure that employees are rewarded for assisting small
businesses.
Capabilities of SBA employees to provide
proper assistance to small business owners.
Review the agency's cooperative agreements,
partnerships and co-sponsorships.
Continue to assess the adequacy of the
agency's budgetary requests, financial management, and
reporting goals.
Agency personnel capabilities to properly
manage loan defaults to maximize recovery of
collateral.
Whether SBA improperly utilizes statutory
authority to create untested initiatives and the
procedures by which the agency develops such programs.
In carrying out this oversight, the Committee will focus
particularly on streamlining and reorganizing of the agency's
operations to provide maximum assistance to small business
owners. Offices that primarily provide assistance or advice to
headquarters staff that do not promote the interests of small
businesses or protect the federal government as a guarantor of
loans will be recommended for cuts or elimination.
OVERSIGHT OF FEDERAL REGULATORY AND PAPERWORK BURDENS
The Committee will conduct hearings and investigations into
burdensome federal rules, reporting and recordkeeping
requirements affecting small businesses that may include any or
all of the following, as well as matters brought to the
attention of the Committee subsequent to the filing of this
Report:
Identify specific rules and regulations
already issued or at the proposed rule stage to assess
the impact on small businesses.
Examine agency compliance with the
Regulatory Flexibility Act and Paperwork Reduction Act.
Oversee, to the extent relevant, the work of
the Office of Information and Regulatory Affairs at the
Office of Management and Budget and the Chief Counsel
for Advocacy at the Small Business Administration to
ensure that they are fulfilling their mission to
advocate vigorously on behalf of America's small
business owners in regulatory matters at federal
agencies.
Identify regulations that impose unnecessary
barriers to competitive market entry by small
businesses and place small businesses at a competitive
disadvantage with respect to larger competitors.
Identify regulations that fail to minimize
recordkeeping and reporting requirements, including the
elimination of duplicative requirements as required by
the Paperwork Reduction Act.
Assess whether small businesses are provided
sufficient compliance assistance, including small
entity compliance guides issued by agencies as mandated
by the Small Business Regulatory Enforcement Fairness
Act.
Evaluate the need to amend and further
strengthen the Regulatory Flexibility Act and the
Paperwork Reduction Act to improve agency compliance
with the laws and ensure that small businesses are not
unnecessarily burdened by regulations.
OVERSIGHT OF FEDERAL TAX POLICY
The Committee will conduct hearings and investigations into
the federal tax code, its impact on small business, and
Internal Revenue Service's (IRS) collection of taxes that may
include any or all of the following, as well as matters brought
to the attention of the Committee subsequent to the filing of
this Report:
Identification of tax code provisions and
proposed rules that hinder the ability of small
businesses to create jobs and recommendations for
modifying those provisions to boost small business job
growth.
Examination of the structure of the tax code
in order to simplify compliance for small businesses.
Assessment of the recordkeeping and
reporting requirements associated with tax compliance
and suggestions for reducing such burdens on small
businesses.
Impact of the tax reform law, Pub. L. No.
115-97, on small business tax liabilities and
compliance and its harm to economic growth and job
creation.
Efficiencies at the IRS that improve the
interaction between the government and small business
owners.
Inefficiencies at the IRS that force small
businesses to divert capital from job growth to tax
compliance.
Investigate incentives that may be used to
support the growth of the micro-entrepreneur.
Analyze tax code restructuring to enhance
the ability of small businesses to offer retirement
benefits through lowering their costs.
OVERSIGHT OF HEALTH CARE POLICY
The Committee will conduct hearings and investigations into
federal health care policy (such as Medicare and Medicaid), as
well as matters brought to the attention of the Committee
subsequent to the filing of this Report:
The availability of health insurance in the
federal marketplaces established by the Patient
Protection and Affordable Care Act.
Implementation and efficacy of changes made
to health care policy through various laws enacted
throughout the 115th Congress, including but not
limited to the tax reform law, Pub. L. No. 115-97.
The impact of the Patient Protection and
Affordable Care Act, Medicare and Medicaid on the
ability of physicians, pharmacists, and allied health
care providers to offer the best care possible to
patients.
Examination of increases in efficiencies
that will improve the provision of health care while
reducing costs to small businesses that offer their
workers' health insurance.
OVERSIGHT OF ENERGY POLICY
The Committee will conduct hearings and investigations into
energy policy to reduce the cost of energy and increase
renewable energy that may include any or all of the following,
as well as matters brought to the attention of the Committee
subsequent to the filing of this Report:
Innovations developed by small businesses
that create greater reliance on renewable energy.
Federal regulatory policies that increase
dependence on renewable energy and decrease energy
costs.
Policies needed to incentivize production of
renewable energy in the United States.
Examination of commercialization of research
in renewable energy.
Federal regulations or policies that affect
energy costs for small businesses.
Investigate methods to increase energy
efficiency and improve resource conservation practices
for small businesses.
Federal initiatives to streamline business
operations and reduce energy costs for small firms.
The primary thrust of the Committee's efforts will focus on
efforts to use the innovation of America's entrepreneurs to
fuel the drive for greater energy independence, including the
development of renewable energy products.
OVERSIGHT OF TRADE AND INTELLECTUAL PROPERTY POLICY
The Committee will conduct hearings and investigations into
international trade and intellectual property policies of
America and its trading partners that may include any or all of
the following, as well as matters brought to the attention of
the Committee subsequent to the filing of this Report:
Impact of free trade agreements to increase
exports by American small businesses.
Oversight of SBA's Office of International
Trade and the agency's efforts to promote small
business exports.
Examination of the impact of illicit actions
by foreign entities on small businesses and whether the
federal government is doing enough to protect their
interests.
Whether the federal government is doing
enough to protect the intellectual property rights of
small businesses by foreign competitors.
The impact of federal intellectual property
policies, particularly patents and copyrights, to
protect the innovations of American entrepreneurs.
Efforts to increase exports by small
businesses.
Whether the United States Trade
Representative and Department of Commerce sufficiently
protect the interests of small businesses in the
negotiation of free trade agreements.
Whether the United States Trade
Representative takes positions at the World Trade
Organization that sufficiently promote the interests of
American small businesses.
Measure the performance of federal trade
programs, which seek to reduce small firms' costs of
expanding into international markets, including those
administered by the SBA, Departments of Commerce and
Agriculture, the Export-Import Bank, and the Overseas
Private Investment Corporation.
Evaluate the implementation of the National
Export Promotion Strategy, particularly its focus on
small businesses.
Examine efforts methods to increase the
representation of small business interests in the
negotiation of new trade agreements and enforcement of
existing agreements and treaties.
Evaluate the availability and quality of
data measuring the contributions to the nation's trade
performance by small businesses, including information
gathered by the Department of Commerce and the United
States Trade Representative.
Assess current trade duties and tariffs,
both domestic and foreign, to evaluate their impact on
American small businesses, economic growth, and job
creation.
Conduct analysis on the importance of
intellectual property rights to underserved
entrepreneurs and how best to increase their
representation of such rights.
OVERSIGHT OF AGRICULTURE POLICY
The Committee will conduct hearings and investigations into
agriculture policies that may include any or all of the
following, as well as matters brought to the attention of the
Committee subsequent to the filing of this Report:
Examine the impact of federal policies on
family farms, ranchers, and rural small businesses,
including changes made by the 2018 Farm Bill.
Evaluate the impact of access to capital
issues facing rural areas, farmers and agribusinesses.
Analyze the extent to which SBA programs and
United States Department of Agriculture programs
overlap and how they can better coordinate to provide
better services and streamlines assistance to the
agriculture community.
Oversee federal activities to spur economic
development in rural communities.
Examine ways in which the federal government
can enhance the use of next-generation technologies in
small agriculture businesses.
OVERSIGHT OF TECHNOLOGY AND INNOVATION POLICY
The Committee will conduct hearings and investigations into
technology and telecommunications policies that may include any
or all of the following, as well as matters brought to the
attention of the Committee subsequent to the filing of this
Report:
Examine the impact of federal policies on
broadband deployment, particularly in underserved
areas.
Investigate the economic benefits of
increasing the speed of broadband and proposals for
funding the Universal Service Fund.
Examine the cost and benefits of proposed
reforms to the United States patent system and their
impact on small innovators.
Evaluate the need to increase IP education
and services to underserved innovators.
Monitor efforts to assist small businesses
in cybersecurity hygiene and evaluate the role the SBA
has in the process to collect and disseminate
information and educate small businesses.
Assess the current government-wide
initiative to ensure small technology firms have
adequate contracting opportunities while also
protecting government systems through rigorous
cybersecurity requirements.
Examine ways in which the federal government
can enhance the use of next-generation technologies in
small agriculture businesses.
OVERSIGHT OF VETERANS' ENTREPRENEURSHIP POLICY
The Committee will conduct hearings and investigations into
veterans' policies that may include any or all of the
following, as well as matters brought to the attention of the
Committee subsequent to the filing of this Report:
Examine how current entrepreneurial and
capital assistance programs are accommodating the
growing veteran population.
Review federal actions to assist veteran
entrepreneurs and ensure they are consistent with
federal small business policy.
Evaluate the effectiveness of federal
programs that seek to improve veterans' access to
markets and training by implementing and monitoring
enhanced programmatic data collection.
Assess whether the federal government is
sufficiently coordinating activities and allocating
resources appropriately with regard to veteran
entrepreneurship activities and initiatives.
Monitor the transition of federal
entrepreneurial programs from the Department of
Veterans' Affairs to the SBA.
OVERSIGHT OF LABOR AND WORKFORCE POLICY
The Committee will conduct hearings and investigations into
labor and workforce policies that may include any or all of the
following, as well as matters brought to the attention of the
Committee subsequent to the filing of this Report:
Review federal actions to assist employers
in workforce training and analyze ways to meet the
growing need for more skilled workers.
Study the effectiveness of efforts to
encourage more underserved workers to enter fields
where skilled labor is needed.
Evaluate the role immigration policy plays
in assisting small businesses meet their workforce
needs and whether the existing visa system should be
reformed.
Investigate policies to encourage more
participation in labor market through initiatives that
can be offered by small businesses, such as increased
minimum wages, paid sick leave, paid parental leave,
and flexible work arrangements.
Study the role student loan debt plays in
entrepreneurship and methods to address the crisis.
LEGISLATIVE ACTIVITIES
Clause 1(d) of Rule XI of the Rules of the House of
Representatives for the 116th Congress requires that each
standing committee, no later than January 2 of each odd-
numbered year, submit to the House a report on the activities
of that committee, including a separate section summarizing the
legislative activities of that committee.
INVESTING IN MAIN STREET ACT OF 2019
H.R. 116
Summary
H.R. 116 amends the Small Business Investment Act of 1958
to permit certain banking entities, subject to the approval of
the appropriate federal banking agency, to invest up to 15
percent of their capital and surplus in one or more small
business investment companies (SBICs), or in any entity
established to invest solely in SBICs.
Legislative History
H.R. 116 was introduced on January 3, 2019 by
Representative Judy Chu (D-CA) and Representative Ralph Norman
(R-SC). H.R. 116 passed the House on January 14, 2019 under
Suspension of the Rules by a vote of 403-2 (Roll Call No. 30).
H.R. 116 was received in the Senate and read twice and referred
to the Committee on Small Business and Entrepreneurship on
January 15, 2019.
SMALL BUSINESS ADVOCACY IMPROVEMENTS ACT
H.R. 128
Summary
H.R. 128 amends the Small Business Act to expand the
primary functions and additional duties of the Office of
Advocacy of the Small Business Administration to include
examining the role of small businesses in the international
economy and representing the views and interests of small
businesses before foreign governments and international
entities to contribute to regulatory and trade initiatives that
may affect small businesses.
Legislative History
H.R. 128 was introduced on January 3, 2019 by
Representative James Comer (R-KY) and Chairwoman Nydia M.
Velazquez (D-NY). H.R. 128 passed the House on January 8, 2019
under Suspension of the Rules by voice vote. H.R. 128 was
received in the Senate and read twice and referred to the
Committee on Small Business and Entrepreneurship on January 9,
2019.
EXPANDING CONTRACTING OPPORTUNITIES FOR SMALL BUSINESS ACT
H.R. 190
Summary
H.R. 190 amends the Small Business Act to eliminate the
inclusion of option years in the award price for certain sole
source contracts (i.e., contracts awarded without a competitive
process). Under current law, option years in the award price
for such contracts limit their dollar award threshold.
Specifically, the bill revises requirements for the award of
these contracts to (1) qualified Historically Underutilized
Business Zone (HUBZone) small businesses, (2) small businesses
owned and controlled by service-disabled veterans, (3)
economically disadvantaged small businesses owned and
controlled by women, and (4) small businesses owned and
controlled by women in substantially underrepresented
industries. The Government Accountability Office must evaluate
the policies and practices used by the Small Business
Administration and other federal agencies to ensure that
contracting officers are properly classifying sole source
contracts under procurement programs for businesses owned by
women and disabled veterans in the Federal Procurement Data
System.
Legislative History
H.R. 190 was introduced on January 8, 2019 by
Representative Roger Marshall (R-KS) and Representative Bradley
Schneider (D-IL). H.R. 190 was considered under Suspension of
the Rules on January 14, 2019 and passed the House on January
16, 2019, by a vote of 415-6 (Roll Call No. 36). H.R. 190 was
received in the Senate and read twice and referred to the
Committee on Small Business and Entrepreneurship on January 17,
2019.
ENCOURAGING SMALL BUSINESS INNOVATION ACT
H.R. 206
Summary
H.R. 206 amends the Small Business Act to modify
requirements of the Small Business Innovation Research (SBIR)
and Small Technology Transfer Research (STTR) programs to
require participating agencies to use part of their allocations
to conduct outreach to minorities and underrepresented states
by removing the waiver requirement from statute. It also
increases financial assistance to SBIR and STTR companies by
utilizing Small Business Investment Companies (SBICs) and
increasing the calculated leverage of these companies by
excluding the amount of any investment made by SBIR and STTR
participants with a cap of 20 percent of the private capital of
that company. Finally, the bill provides an avenue for more
experienced SBIR and STTR companies to mentor new companies.
Legislative History
H.R. 206 was introduced on January 3, 2019 by
Representative Harley Rouda (D-CA). H.R. 206 passed the House
on January 14, 2019 under Suspension of the Rules by voice
vote. H.R. 206 was received in the Senate and read twice and
referred to the Committee on Small Business and
Entrepreneurship on January 15, 2019.
CLARITY ON SMALL BUSINESS PARTICIPATION IN CATEGORY MANAGEMENT ACT
H.R. 226
Summary
H.R. 226 amends the Small Business Act to revise the SBA's
reporting requirements to the President and Congress on
procurement contracts to include spending data in each best in
class designation (highest current industry performance level)
and the number of and total contract amounts awarded to: (1)
qualified Historically Underutilized Business Zone (HUBZone)
small businesses, (2) small businesses owned and controlled by
women, (3) small businesses owned and controlled by service-
disabled veterans, and (4) small businesses owned and
controlled by socially and economically disadvantaged
individuals.
Legislative History
H.R. 226 was introduced on January 3, 2019 by Chairwoman
Nydia M. Velazquez (D-NY) and Ranking Member Steve Chabot (R-
OH). H.R. 226 was considered under Suspension of the Rules on
January 8, 2019 and passed the House on January 9, 2019, by a
vote of 414-11 (Roll Call No. 18). H.R. 226 was received in the
Senate and read twice and referred to the Committee on Small
Business and Entrepreneurship on January 10, 2019. H.R. 226 was
included in H.R. 2500, the National Defense Authorization Act
for Fiscal Year 2020. H.R. 2500 was reported, as amended, by
the House Committee on Armed Services on June 19, 2019, and
passed the House on July 12, 2020, by a vote of 220-197 (Roll
Call No. 473). H.R. 226 was included in the final version of
the National Defense Authorization Act of 2020, (S. 1790).
INCENTIVIZING FAIRNESS IN SUBCONTRACTING ACT
H.R. 227
Summary
H.R. 227 amends the Small Business Act to modify provisions
regarding the credit given to small business prime contractors
for the use of certain lower-tier subcontractors in order to
attain the percentage goals specified in their subcontracting
plans. Such credit may be given if the goals pertain only to
single contracts with federal agencies or to two or more
contracts with one or more of such agencies. In addition, the
bill requires each contracting agency to collect and review
data on subcontracting plans and establishes a dispute process
for non-payment to subcontractors.
Legislative History
H.R. 227 was introduced on January 3, 2019 by Chairwoman
Nydia M. Velazquez (D-NY) and Representative Trent Kelly (R-
MS). H.R. 227 passed the House on January 8, 2019 under
Suspension of the Rules by voice vote. H.R. 227 was received in
the Senate and read twice and referred to the Committee on
Small Business and Entrepreneurship on January 9, 2019. H.R.
227 was included in H.R. 2500, the National Defense
Authorization Act for Fiscal Year 2020. H.R. 2500 was reported,
as amended, by the House Committee on Armed Services on June
19, 2019, and passed the House on July 12, 2020, by a vote of
220-197 (Roll Call No. 473). H.R. 227 was included in the final
version of the National Defense Authorization Act of 2020, (S.
1790).
STIMULATING INNOVATION THROUGH PROCUREMENT ACT
H.R. 246
Summary
H.R. 246 amends the Small Business Act to provide
assistance to small businesses participating in the Small
Business Innovation Research (SBIR) Program or the Small
Business Technology Transfer (STTR) Program. Specifically, the
bill requires (1) the Small Business Administration (SBA) to
coordinate with the senior procurement executives of federal
agencies participating in SBIR or STTR programs to assist small
businesses participating in such programs with commercializing
research before the business is awarded a federal contract; (2)
the SBA to modify its policy directives to require procurement
center representatives to assist small businesses participating
in SBIR or STTR programs with researching solicitations for
federal contracts and submitting bids; and (3) each Office of
Small and Disadvantaged Business Utilization to assist small
businesses participating in SBIR or STTR programs with
researching solicitations for federal contracts and submitting
bids.
Legislative History
H.R. 246 was introduced on January 4, 2019 by
Representative Abby Finkenauer (D-IA), Chairwoman Nydia M.
Velazquez (D-NY), and Representative John Curtis (R-UT). H.R.
246 passed the House on January 14, 2019 under Suspension of
the Rules by voice vote. H.R. 246 was received in the Senate
and read twice and referred to the Committee on Small Business
and Entrepreneurship on January 15, 2019. H.R. 246 was included
in H.R. 2500, the National Defense Authorization Act for Fiscal
Year 2020. H.R. 2500 was reported, as amended, by the House
Committee on Armed Services on June 19, 2019, and passed the
House on July 12, 2020, by a vote of 220-197 (Roll Call No.
473). H.R. 246 was included in the final version of the
National Defense Authorization Act of 2020, (S. 1790).
ACCESS TO SUFFICIENT CAPITAL FOR EVERYONE IN NATURAL DISASTER AREAS ACT
OF 2019
H.R. 277
Summary
H.R. 277 amends the Small Business Act to make permanent
the temporary increase of the minimum disaster loan amount for
which the Small Business Administration (SBA) may require
collateral from $14,000 to $25,000 for physical damage loans in
SBA agency disaster declarations.
Legislative History
H.R. 277 was introduced on January 8, 2019 by Chairwoman
Nydia M. Velazquez (D-NY) and Ranking Member Steve Chabot (R-
OH). H.R. 277 was reported by the House Committee on Small
Business on June 13, 2019 and passed the House on July 15, 2019
under Suspension of the Rules by voice vote. H.R. 277 was
received in the Senate and read twice and referred to the
Committee on Small Business and Entrepreneurship on July 16,
2019.
SERVICE DISABLED VETERANS SMALL BUSINESS CONTINUATION ACT
H.R. 499
Summary
H.R. 499 provides a technical and clerical amendment to
section 3(q)(2) of the Small Business Act (15 U.S.C. 632(q)) to
ensure eligible surviving spouses of veterans who died with
less than a 100 percent disability rating are able to maintain
their service-disabled veteran-owned small business (SDVOSB)
status for up to three years following the death of the
service-disabled veteran. H.R. 499 aims to create parity in the
treatment of surviving spouses between the service-disabled
veteran-owned small business contracting program managed by the
U.S. Department of Veterans Affairs and that managed by the
Small Business Administration.
Legislative History
H.R. 499 was introduced on January 11, 2019, by
Representative Steve Chabot (R-OH) and Representative Antonio
Delgado (D-NY). H.R. 499 was reported by the House Committee on
Small Business on October 15, 2019. The House passed H.R. 499
on November 13, 2019, under Suspension of the Rules by a vote
of 423-0 (Roll Call No. 613). H.R. 499 was included in the
final version of the National Defense Authorization Act of
2020, (S. 1790).
VERIFICATION ALIGNMENT AND SERVICE DISABLED BUSINESS ADJUSTMENT ACT
H.R. 1615
Summary
H.R. 1615 eliminates the certification process offered by
the U.S. Department of Veterans Affairs (VA) and transfers to
the Small Business Administration (SBA) the responsibility of
certifying all veteran-owned and service-disabled veteran-owned
small businesses interested in participating in the VA's small
business contracting program. The bill transfers to the SBA the
responsibility of keeping a database of all certified veteran-
owned and service-disabled veteran-owned small businesses,
allows the VA to provide the necessary funds to cover SBA's
costs in certifying veteran-owned small businesses and,
transfers assets of the VA's Center for Verification and
Evaluation to the SBA. Furthermore, H.R. 1615 requires formal
certification of service-disabled veteran-owned small
businesses in SBA's government-wide contracting program.
Legislative History
H.R. 1615 was introduced on March 07, 2019, by
Representative Trent Kelly (R-MS), Ranking Member Steve Chabot
(R-OH), Chairwoman Nydia Velazquez (D-NY), and Ann Kuster (D-
MH). An amendment offered by Representative Trent Kelly (R-MS)
was agreed to by voice vote. H.R. 1615 was reported, as amended
by the House Committee on Small Business on November 12, 2019
and passed the House, as amended, on November 13, 2019 under
Suspension of the Rules by voice vote. H.R. 1615 was included
in H.R. 6395, the William M. (Mac) Thornberry National Defense
Authorization Act for Fiscal Year 2021. H.R. 6395 was reported,
as amended, by the House Committee on Armed Services on July 9,
2020, and passed the House on July 21, 2020, by a vote of 295-
125 (Roll Call No. 152). H.R. 1615 was included in the final
version of the William M. (Mac) Thornberry National Defense
Authorization Act of 2021, (H.R. 6395).
SMALL BUSINESS ADVANCE CYBERSECURITY ENHANCEMENTS ACT OF 2019
H.R. 1648
Summary
H.R. 1648 amends the Small Business Act to encourage small
businesses to work with the Federal Government by providing
them additional resources. In order to combat small businesses'
reluctance to engage with the Federal Government, this
legislation encourages their collaboration in the following
ways: it establishes Small Business Administration (SBA) Small
Business Development Centers (SBDCs) as the primary interface
for federal information sharing for small businesses; ensures
small businesses that share cyber indicators through SBDCs
receive the same protections and exemptions provided in the
Cybersecurity Information Sharing Act of 2015; ensures that any
policies or rulemaking adopted by any federal agency as a
result of small business cyber information sharing do not
unfairly burden small businesses; and expands liability
protections for small businesses that engage with the Federal
Government in good faith.
Legislative History
H.R. 1648 was introduced on March 8, 2019, by Ranking
Member Steve Chabot (R-OH) and Chairwoman Nydia Velazquez (D-
NY). H.R. 1648 was referred to the House Committee on Small
Business on March 8, 2019. H.R. 1649 was ordered out of the
House Committee on Small Business on June 13, 2019 by voice
vote.
SMALL BUSINESS DEVELOPMENT CENTER CYBER TRAINING ACT OF 2019
H.R. 1649
Summary
H.R. 1649 would establish a cyber counseling certification
program in Small Business Development Centers (SBDCs) to
provide specific, free-of-charge cyber training for small
businesses. The cyber training provided by the nationwide
network of SBDCs will offer crucial resources for small
businesses to plan and implement cybersecurity protections and
combat cyber-attacks.
Legislative History
H.R. 1649 was introduced on March 8, 2019, by Ranking
Member Steve Chabot and Representative Dwight Evans (D-PA).
H.R. 1649 was reported by the House Committee on Small Business
on June 13, 2019 and passed the House on July 15, 2019, by a
voice vote. On July 16, 2019, the bill was received by the
Senate and was placed on the Senate Legislative Calendar under
General Orders. H.R. 1649 was included in H.R. 2500, the
National Defense Authorization Act for Fiscal Year 2020. H.R.
2500 was reported, as amended, by the House Committee on Armed
Services on June 19, 2019, and passed the House on July 12,
2020, by a vote of 220 197 (Roll Call No. 473). H.R. 1649 was
not included in the final version of the National Defense
Authorization Act of 2020, (S. 1790).
TO AMEND THE SMALL BUSINESS ACT TO REQUIRE THE SMALL BUSINESS AND
AGRICULTURE REGULATORY ENFORCEMENT OMBUDSMAN TO CREATE A CENTRALIZED
WEBSITE FOR COMPLIANCE GUIDES, AND FOR OTHER PURPOSES.
H.R. 2142
Summary
H.R. 2142 requires the Office of the National Ombudsman at
the Small Business Administration to create a centralized,
publicly available website. H.R. 2141 mandates the website
provide hyperlinks to small business compliance guides
described under section 212 of the Small Business Regulatory
Enforcement Fairness Act of 1996 and provide the contact
information for the person at the agency who could provide
small businesses with assistance on the rules within the
guides. H.R. 2142 also requires the Ombudsman to report on
federal agencies' compliance with the Section 212 requirements
of the Small Business Regulatory Enforcement Fairness Act
(SBREFA) in its annual report to Congress.
Legislative History
H.R. 2142 was introduced on April 9, 2019, by
Representative Antonio Delgado (D-NY) and Representative John
Joyce (R-PA). H.R. 2142 was reported by the House Committee on
Small Business on June 13, 2019 and passed the House by voice
vote under Suspension of the Rules on July 15, 2019. H.R. 2142
was received in the Senate and referred to the Committee on
Small Business and Entrepreneurship on July 16, 2019.
SBA CYBER AWARENESS ACT
H.R. 2331
Summary
H.R. 2331 requires the SBA to report annually to Congress
on (1) an assessment of SBA's information technology (IT) and
cybersecurity infrastructure; (2) a strategy to increase such
infrastructure; (3) a detailed account of SBA's IT equipment or
interconnected system or subsystem of equipment manufactured by
an entity that has its principal place of business in the
People's Republic of China; and (4) any SBA cybersecurity risk
or incident that occurred during two years before the report,
including SBA's action to respond to or remediate it.
Legislative History
H.R. 2331 was introduced on April 18, 2019, by
Representative Jason Crow (D-CO), Representative Troy Balderson
(R-OH), Chairwoman Nydia Velazquez (D-NY), and Ranking Member
Steve Chabot (R-OH). H.R. 2331 was reported by the House
Committee on Small Business on June 13, 2019 and passed the
House by voice vote on July 15, 2019. The Senate received the
bill on July 16, 2019 and placed it on the Legislative Calendar
under General Orders. H.R. 2331 was included in H.R. 2500, the
National Defense Authorization Act for Fiscal Year 2020. H.R.
2500 was reported, as amended, by the House Committee on Armed
Services on June 19, 2019, and passed the House on July 12,
2020, by a vote of 220-197 (Roll Call No. 473). H.R. 2331 was
not included in the final version of the National Defense
Authorization Act of 2020, (S. 1790).
CLARIFYING THE SMALL BUSINESS RUNWAY EXTENSION ACT
H.R. 2345
Summary
H.R. 2345 provides for the implementation of the Small
Business Runway Extension Act of 2018 (Runway Act), which
became law on December 17, 2018 and extended the receipts-based
size standard calculation to 5 years. In particular, H.R. 2345
amends section 3(a)(2)(C) of the Small Business Act to clarify
that the changes made by the Runway Act are applicable to the
Small Business Administration (SBA) and institutes a date by
which the SBA must issue a final rule for its implementation.
The bill also aligns the size standard based on data to the
receipts-based size standard by changing the calculation to 5
years. Finally, the bill required SBA to develop a transition
plan for small businesses and agencies, to help them
successfully navigate the transition from the previous 3-year
calculation to the new 5-year calculation, as mandated by the
Runway Act.
Legislative History
H.R. 2345 was introduced on April 18, 2019, by
Representative Pete Stauber (R-MN) and Representative Jared
Golden (D-ME). An amendment offered by Representative Jim
Hagedorn (R-MN) was agreed to by voice vote. H.R. 2345 was
reported, as amended by the House Committee on Small Business
on June 13, 2019 and passed the House, as amended, on July 15,
2019, under Suspension of the Rules by voice vote. H.R. 2345
was included in H.R. 2500, the National Defense Authorization
Act for Fiscal Year 2020. H.R. 2500 was reported, as amended,
by the House Committee on Armed Services on June 19, 2019, and
passed the House on July 12, 2020, by a vote of 220 197 (Roll
Call No. 473). H.R. 2345 was not included in the final version
of the National Defense Authorization Act of 2020, (S. 1790).
SMALL BUSINESS CONTRACTING ACT OF 2019
H.R. 3372
Summary
H.R. 3372 amends the Small Business Act to authorize
federal agencies to double the value of contracts awarded to
Puerto Rican subcontractors for the purpose of obtaining credit
towards the small business prime contracting goal.
Legislative History
H.R. 3372 was introduced on June 19, 2019 by Chairwoman
Nydia M. Velazquez (D-NY) and Representative Gilbert Cisneros
(D-CA). H.R. 3372 was included in H.R. 2500, the National
Defense Authorization Act for Fiscal Year 2020. H.R. 2500 was
reported, as amended, by the House Committee on Armed Services
on June 19, 2019, and passed the House on July 12, 2020, by a
vote of 220-197 (Roll Call No. 473). H.R. 3372 was included in
the final version of the National Defense Authorization Act of
2020, (S. 1790).
SMALL BUSINESS TERRITORIES EQUITY ACT
H.R. 3428
Summary
H.R. 3428 amends the Small Business Act to authorize
federal agencies to double the value of contracts awarded to
small businesses in the U.S. Virgin Islands, American Samoa,
Guam, or the Northern Mariana Islands for the purpose of
obtaining credit towards the small business contracting goal.
Legislative History
H.R. 3428 was introduced on June 19, 2019 by Chairwoman
Nydia M. Velazquez (D-NY), Representative Stacey Plaskett (D-
VI), Representative Gregorio Sablan (D-MP), Representative
Michael San Nicolas (D-GU), and Representative Aumua Amata
Coleman Radewagen (R-AS). H.R. 23428 was included in H.R. 2500,
the National Defense Authorization Act for Fiscal Year 2020.
H.R. 2500 was reported, as amended, by the House Committee on
Armed Services on June 19, 2019, and passed the House on July
12, 2020, by a vote of 220-197 (Roll Call No. 473). H.R. 3372
was included in the final version of the National Defense
Authorization Act of 2020, (S. 1790).
VETERAN ENTREPRENEURSHIP TRAINING ACT OF 2019
H.R. 3537
Summary
H.R. 3537 amends the Small Business Act to codify for five
years the Boots to Business program, which helps transitioning
servicemembers launch and grow small businesses. The bill also
sets the goals of the program, which include in-depth training
for servicemembers interested in owning a business; and
development of tools to identify opportunities, draft business
plans, identify sources of capital, connect with local
resources for small business, and launch a small business. The
bill delineates the program components, which include a two-
day, in-person entrepreneurship program. It also gives SBA the
authority to collaborate with public and private entities to
develop the curricula; and it ensures Veterans Business
Outreach Centers (VBOCs) regularly participate in the program,
and to the reasonable maximum extent, allows the participation
of other resource partners as well.
Legislative History
H.R. 3537 was introduced on June 27, 2019, by
Representative Bradley Schneider (D-IL) and Representative Ross
Spano (R-FL). H.R. 3537 was reported by the House Committee on
Small Business on October 15, 2019 and passed the House under
Suspension of the Rules on November 13, 2019, by a vote of 424-
1 (Roll Call No. 612). H.R. 3537 was received in the Senate and
read twice and referred to the Committee on Small Business and
Entrepreneurship on November 14, 2019. H.R. 3537 was included
in H.R. 2500, the National Defense Authorization Act for Fiscal
Year 2020. H.R. 2500 was reported, as amended, by the House
Committee on Armed Services on June 19, 2019, and passed the
House on July 12, 2020, by a vote of 220-197 (Roll Call No.
473). H.R. 3537 was not included in the final version of the
National Defense Authorization Act of 2020, (S. 1790).
ENSURING SAFE CAPITAL ACCESS FOR ALL SMALL BUSINESS ACT
H.R. 3540
Summary
H.R. 3540 amends the Small Business Act to removes cannabis
from the schedule of controlled substances, and it prohibits
the Small Business Administration from declining to provide
certain small business loans to an eligible entity solely
because it is a cannabis-related legitimate business or service
provider.
Legislative History
H.R. 3540 was introduced on June 27, 2019 by Chairwoman
Nydia M. Velazquez (D-NY). H.R. 3540 was included as a
provision in H.R. 3884, the Marijuana Opportunity Reinvestment
and Expungement Act of 2019 (MORE Act). H.R. 3884 was reported,
as amended, by the House Committee on the Judiciary on November
21, 2019, and passed the House on December 4, 2020.
ENSURING ACCESS TO COUNSELING AND TRAINING FOR ALL SMALL BUSINESSES ACT
H.R. 3543
Summary
H.R. 3543 amends the Small Business Act to remove cannabis
from the schedule of controlled substances, and it prohibits
the Small Business Administration from declining to provide
certain small business loans to an eligible entity solely
because it is a cannabis-related legitimate business or service
provider.
Legislative History
H.R. 3543 was introduced on June 27, 2019 by Representative
Jared Golden (D-ME). H.R. 3543 was included as a provision in
H.R. 3884, the Marijuana Opportunity Reinvestment and
Expungement Act of 2019 (MORE Act). H.R. 3884 was reported, as
amended, by the House Committee on the Judiciary on November
21, 2019, and passed the House on December 4, 2020.
HOMEGROWN ACT OF 2019
H.R. 3544
Summary
H.R. 3544 removes marijuana from the list of scheduled
substances under the Controlled Substances Act and eliminates
criminal penalties for an individual who manufactures,
distributes, or possesses with intent to distribute marijuana.
Additionally, the bill requires the Small Business
Administration to establish the Equitable Licensing Grant
Program. The purpose of the grant program is to support the
implementation of cannabis licensing programs that minimize
barriers to licensing and employment for individuals adversely
impacted by the war on drugs.
Legislative History
H.R. 3544 was introduced on June 27, 2019 by Representative
Dwight Evans (D-PA). H.R. 3544 was included as a provision in
H.R. 3884, the Marijuana Opportunity Reinvestment and
Expungement Act of 2019 (MORE Act). H.R. 3884 was reported, as
amended, by the House Committee on the Judiciary on November
21, 2019, and passed the House on December 4, 2020.
PATRIOTIC EMPLOYER PROTECTION ACT OF 2019
H.R. 3661
Summary
H.R. 3661 amends the Small Business Act to remove statutory
restrictions that limit use of the Small Business
Administration's Military Reservist Economic Injury Disaster
Loan (MREIDL) and Repayment Deferral programs to active duty
``during a period of military conflict'' and replaces this
language with ``being ordered to perform active service for a
period of more than 30 consecutive days.'' This change to the
law broadens the pool of service members and reservists
eligible for the MREIDL and Repayment Deferral programs. H.R.
3661 also requires the President to submit to Congress a report
on the number of loans made under the MREIDL program and the
dollar volume of those loans.
Legislative History
H.R. 3661 was introduced on July 10, 2019 by Representative
Andy Kim (D-NJ) and Representative Tim Burchett (R-TN). H.R.
3661 was reported by the House Committee on Small Business on
October 15, 2019, and passed the House, as amended, on November
13, 2019 under Suspension of the Rules by voice vote. H.R. 3661
was received in the Senate and read twice and referred to the
Committee on Small Business and Entrepreneurship on November
14, 2019. H.R. 3661 was included in the final version of the
National Defense Authorization Act of 2020, (S. 1790).
SUCCESSFUL ENTREPRENEURSHIP FOR RESERVISTS AND VETERANS ACT
H.R. 3734
Summary
H.R. 3734 amends the Small Business Act to require The
Interagency Task Force for Small Business Development to report
annually to Congress on the appointments made to the task force
and to identify and outline a plan for outreach and promotion
of programs serving veterans at SBA. The bill also requires a
report from the Government Accountability Office on the credit
issues related to veterans.
Legislative History
H.R. 3734 was introduced on July 12, 2019, by
Representative Sharice Davids (D-KS) and Ranking Member Steve
Chabot (R-OH). H.R. 3734 was reported by the House Committee on
Small Business on October 15, 2019, and passed the House on
November 13, 2019, under Suspension of the Rules by a vote of
421-3 (Roll Call No. 614). H.R. 3734 was received in the Senate
and read twice and referred to the Committee on Small Business
and Entrepreneurship on November 14, 2019.
TO ESTABLISH GROWTH ACCELERATOR FUND COMPETITION WITHIN THE SMALL
BUSINESS ADMINISTRATION, AND FOR OTHER PURPOSES.
H.R. 4387
Summary
The SBA funds the Growth Accelerator Fund Competition for
the nation's most innovative and promising small business
accelerators and incubators. Accelerators, incubators, co-
working start-up companies, or other entrepreneurial ecosystem
models compete for monetary prizes of $50,000 each. H.R. 4387
codifies the Growth Accelerator Fund Competition at the Small
Business Administration. The bill would mandate that awards be
given on a competitive basis to assist small businesses in
accessing capital, mentors, and networking opportunities; and
advise small business concerns on topics such as market
analysis, company strategy, revenue growth, and securing
funding. H.R. 4387 would also require the Small Business
Administration to prioritize applications from small businesses
in underserved communities.
Additionally, the bill would require the Small Business
Administration to develop metrics that are science-based and
statistically driven, reflect the mission of the
Administration, and include factors related to the economic
impact of the Growth Accelerator Fund Competition. The bill
authorizes $2 million in funds annually for 4 years to carry
out the Competition.
Legislative History
H.R. 4387 was introduced on September 18, 2019, by
Representative Adriano Espaillat (D-NY) and Representative Troy
Balderson (R-OH). H.R. 4387 was reported by the House Committee
on Small Business on October 17, 2019 and passed the House by
voice vote under Suspension of the Rules on October 21, 2019.
H.R. 4387 was received in the Senate and referred to the
Committee on Small Business and Entrepreneurship.
WOMEN'S BUSINESS CENTERS IMPROVEMENTS ACT
H.R. 4405
Summary
The Women's Business Centers Improvements Act strengthens
the Women's Business Center program to ensure that women
entrepreneurs across the country have access to the vital
counseling and technical training services from startup to
success. The bill also authorizes the Women's Business Center
program for four years at $31.5 million for each fiscal year,
establishes an accreditation program to strengthen Women's
Business Centers, creates a transparent process to set up new
center locations, and requires an annual report by the Small
Business Administration to evaluate program effectiveness.
Legislative History
H.R. 4405 was introduced on September 19, 2019, by
Representative Sharice Davids (D-IL) and Rep. Jim Hagedorn (R-
MN). H.R. 4405 was reported by the House Committee on Small
Business on October 17, 2019 and passed the House under
Suspension of the Rules by voice vote.
H.R. 4405 was received in the Senate and referred to the
Committee on Small Business and Entrepreneurship on October 22,
2019.
SMALL BUSINESS DEVELOPMENT CENTERS IMPROVEMENT ACT OF 2019
H.R. 4406
Summary
H.R. 4406 modernizes and strengthens the Small Business
Development Center (SBDC) network and authorizes funding for
the SBDC program for four years (FY2020-FY2023) at $175 million
for each fiscal year. The bill also requires an annual report
to measure the effectiveness of the SBDC program and allows for
the promotion and advertising of the program and its services.
Legislative History
H.R. 4406 was introduced on September 19, 2019, by
Representative Jared Golden (D-ME) and Representative Aumua
Amata Coleman Radewagen (R-AS). H.R. 4406 was reported by the
House Committee on Small Business on October 17, 2019, and
passed the House on October 21, 2019 under Suspension of the
Rules by a vote of 375-25 (Roll Call no. 569). H.R. 4406 was
received in the Senate and referred to the Committee on Small
Business and Entrepreneurship on October 22, 2019.
SCORE FOR SMALL BUSINESS ACT OF 2019
H.R. 4407
Summary
H.R. 4407 amends the Small Business Act to strengthen the
Service Corps of Retired Executives (SCORE) and restores
integrity, accounting, and performance to the program. The bill
includes certain safeguards, ensuring the Small Business
Administration is a good agent of government funds and the
counseling and training program is operating effectively and
efficiently for the 30 million small business owners and
aspiring entrepreneurs throughout the country. More
specifically, the bill protects taxpayers' dollars, ensures
federal contracts are awarded properly, aligns salaries and
performances with federal standards, protects whistleblowers,
and expands services and promotes diversity.
Legislative History
H.R. 4407 was introduced on September 19, 2019, by
Representative Kevin Hern (R-OK) and Representative Angie Craig
(D-MN). H.R. 4407 was reported by the House Committee on Small
Business on October 17, 2019, and passed the House on October
21, 2019 under Suspension of the Rules by a vote of 389-8 (Roll
Call No. 570). H.R. 4407 was received in the Senate and
referred to the Committee on Small Business and
Entrepreneurship on October 22, 2019.
PRISON TO PROPRIETORSHIP FOR FORMERLY INCARCERATED ACT
H.R. 5065
Summary
H.R. 5065 directs the Service Corps of Retired Executives
(SCORE) to provide mentoring, workshops, and training videos
for formerly incarcerated individuals on how to launch and grow
small businesses. H.R. 5065 provides individualized business
mentoring to support the development of business plans and
entrepreneurial growth for recipients of the prison to
proprietorship services up to a year after release; connect
individuals with small business networks and resources;
identify opportunities to access capital when appropriate;
develop a series of instructional videos designed specifically
for incarcerated and formerly incarcerated individuals; and
host workshops on topics specifically tailored to meet the
needs of formerly incarcerated individuals.
Legislative History
H.R. 5065 was introduced on November 13, 2019 by
Representative Hakeem Jeffries (D-NY) and Representative Tim
Burchett (R-TN). H.R. 5065 was reported by the House Committee
on Small Business on December 12, 2019, and passed the House by
voice vote under Suspension of the Rules on January 8, 2020.
H.R. 5065 was received by the Senate and referred to the
Committee on Small Business and Entrepreneurship on January 9,
2020.
PRISON TO PROPRIETORSHIP ACT
H.R. 5078
Summary
H.R. 5078 directs the Associations of Women's Business
Centers and Small Business Development Centers to coordinate
re-entry entrepreneurship services. Coordination includes
developing the curriculum, training mentors and instructors,
identifying opportunities to access capital, and establishing
public-private partnerships to support formerly incarcerated
men and women. Modeled after the successful Boots to Business
program, which provides entrepreneurship training to
servicemembers as they transition from military to civilian
life, the re-entry entrepreneurship services provided through
H.R. 5078 include an introductory presentation highlighting the
opportunities in small business; a self-study course focused on
the basics of entrepreneurship, the language of business, and
small business ownership; five two-day sessions of in-depth
classroom instruction introducing the foundations of self-
employment; and one-on-one mentorship.
Legislative History
H.R. 5078 was introduced on November 13, 2019 by Chairwoman
Nydia Velazquez (D-NY) and Ranking Member Steve Chabot (R-OH).
H.R. 5078 was reported by the House Committee on Small Business
on December 12, 2019, and passed the House under Suspension of
the Rules by a vote of 370-41 (Roll Call No. 8). H.R. 5078 was
received in the Senate and read twice and referred to the
Committee on Small Business and Entrepreneurship on January 13,
2020.
CAPTURING ALL SMALL BUSINESSES ACT OF 2019
H.R. 5130
Summary
H.R. 5130 amends the Small Business Act to extend the
calculation period for the employee-based size standard from
the preceding ``12 months'' to ``24 months.'' The purpose of
the bill is to provide parity between the employee-based size
standard and the receipts-based size standard, whose
calculation had been recently modified by the Small Business
Runway Extension Act of 2018 (Pub. L. 115-324). The bill also
provides language specifying that, when establishing size
standards, the Small Business Administration is subject to the
requirements in the Small Business Act that encompass the
employee-based formula as modified and sets an effective date
of a year after its enactment.
Legislative History
H.R. 5130 was introduced on November 15, 2019 by
Representative Mark Veasey (D-TX) and Representative Kevin Hern
(R-OK). H.R. 5130 was reported by the House Committee on Small
Business on December 19, 2019, and passed the House on January
8, 2020, under Suspension of the Rules by voice vote. H.R. 5130
was included in H.R. 6395, the William M. (Mac) Thornberry
National Defense Authorization Act for Fiscal Year 2021. H.R.
6395 was reported, as amended, by the House Committee on Armed
Services on July 9, 2020, and passed the House on July 21,
2020, by a vote of 295-125 (Roll Call No. 152). H.R. 5130 was
included in the final version of the National Defense
Authorization Act of 2021, (H.R. 6395).
UNLOCKING OPPORTUNITIES FOR SMALL BUSINESSES ACT OF 2019
H.R. 5146
Summary
H.R. 5146 amends the Small Business Act to require the
Small Business Administration (SBA) to promulgate regulations
requiring contracting officers to consider the past performance
of a joint venture, when evaluating an offer on a prime
contract presented by the small business joint venture member.
The small business concern must specify its own duties and
responsibilities independent of its joint venture partner.
Similarly, H.R. 5146 requires the SBA to promulgate regulations
requiring contracting officers to accept past performance
information provided by a prime contractor regarding its small
business subcontractor, when evaluating an offer on a prime
contract presented by the small business concern.
Legislative History
H.R. 5146 was introduced on November 18, 2019, by
Representative Jim Hagedorn (R-MN) and Representative Dwight
Evans (D-PA). H.R. 5146 was reported by the House Committee on
Small Business on December 19, 2019 and passed the House on
January 8, 2020, under Suspension of the Rules by voice vote.
H.R. 5146 was also included in H.R. 6395, the William M. (Mac)
Thornberry National Defense Authorization Act for Fiscal Year
2021. H.R. 6395 was reported, as amended, by the House
Committee on Armed Services on July 9, 2020, and passed the
House on July 21, 2020 by a vote of 295-125 (Roll Call No.
152). H.R. 5146 was included in the final version of the
National Defense Authorization Act of 2021, (H.R. 6395).
NORTHERN MARIANA ISLANDS SMALL BUSINESS DEVELOPMENT ACT
H.R. 6021
Summary
H.R. 6021 amends the Small Business Act to allow the
Commonwealth of the Northern Mariana Islands to establish a
lead Small Business Development Center (SBDC) on the islands
and be eligible for funding. The bill requires the Small
Business Development Center established in the Commonwealth of
the Northern Mariana Islands to meet the same 50 percent match
funding requirement met by Small Business Development Centers
in other states and territories. However, the bill waives the
requirement that the new Small Business Development Center be
established at a higher education institution because the
Commonwealth of the Northern Mariana Islands does not have a
college or university to operate a Small Business Development
Center on-campus. Lastly, this bill allows the Commonwealth of
the Northern Mariana Islands to be eligible for funds through
the Federal and State Technology (FAST) Partnership Program in
order to increase the number of Small Business Innovation
Research (SBIR) and Small Business Technical Transfer (STTR)
applications.
Legislative History
H.R. 6021 was introduced on February 28, 2020 by
Representative Gregorio Sablan (D-MP) and Representative Aumua
Amata Coleman Radewagen (R-AS). H.R. 6021 was ordered to be
Reported by voice vote on March 11, 2020, and passed the House
by voice vote under Suspension of the Rules on September 14,
2020. H.R. 6021 was received by the Senate and referred to the
Committee on Small Business and Entrepreneurship on September
15, 2020. H.R. 6021 was also included in H.R. 6395, the William
M. (Mac) Thornberry National Defense Authorization Act for
Fiscal Year 2021. H.R. 6395 was reported, as amended, by the
House Committee on Armed Services on July 9, 2020, and passed
the House on July 21, 2020, by a vote of 295-125 (Roll Call No.
152). On July 23, 2020 the Senate passed H.R. 6395 by a vote of
86-14 (Record Vote Number: 140). H.R. 6021 was included in the
final version of the National Defense Authorization Act of
2021, (H.R. 6395).
SMALL BUSINESS RELIEF FROM COMMUNICABLE DISEASE INDUCED ECONOMIC
HARDSHIP ACT OF 2020
H.R. 6040
Summary
H.R. 6040 amends the Small Business Act to expand the
definition of a disaster for which the Small Business
Administration (SBA) may provide disaster loans to small
business concerns to include communicable diseases for which
the government issues a travel alert or travel warning, and it
authorizes the SBA to make interest free disaster loans to
small businesses affected by a disaster for which the
government issues a public health emergency.
Legislative History
H.R. 6040 was introduced on February 28, 2020 by Chairwoman
Nydia M. Velzquez (D-NY), Representative Judy Chu (D-CA),
Representative Grace Meng (D-NY), and Representative Antonio
Delgado (D-NY). A similar provision was included in H.R. 6074,
the Coronavirus Preparedness and Response Supplemental
Appropriations Act in Title II. H.R. 6074 passed the House
under Suspension of the Rules by a vote of 415-2 (Roll Call No.
86), passed the Senate by a vote of 96-1 (Record Vote No. 66),
and signed by the President on March 6, 2020 becoming Pub. Law.
No. 116-123.
MICROLOAN TRANSPARENCY AND ACCOUNTABILITY ACT OF 2020
H.R. 6078
Summary
H.R. 6078 amends the Small Business Act to make rural-based
intermediaries eligible to receive a bonus technical assistance
grant and expands Small Business Administration (SBA) reporting
on key Microloan performance metrics, including the number,
amount, and percentage of such loans that defaulted in the
previous year; the extent to which Microloans are provided to
small businesses in rural areas; and the average loan size,
interest rate, fees charged for each Microloan. Specifically,
H.R. 6078 provides a 5 percent technical assistance grant for
intermediaries who make at least 25 percent of their loans to
rural small businesses.
Legislative History
H.R. 6078 was introduced on March 4, 2020 by
Representatives Tim Burchett (R-TN) and Andy Kim (D-NJ). H.R.
6078 was ordered to be reported by voice vote by the House
Committee on Small Business on March 11, 2020, and passed the
House, as amended, on September 14, 2020 under Suspension of
the Rules by voice vote. H.R. 6078 was received in the Senate
and read twice and referred to the Committee on Small Business
and Entrepreneurship on September 15, 2020.
MICROLOAN IMPROVEMENT ACT OF 2020
H.R. 6079
Summary
H.R. 6079 amends the Small Business Act to make numerous
program changes that enhance the ability of Microloan
Intermediaries to provide affordable capital and technical
assistance to existing microbusinesses and aspiring
entrepreneurs. Among other provisions, H.R. 6079 eliminates the
1/55 rule, which has restricted the ability of high-volume
intermediaries to meet demand in their respective states;
lowers interest rates for eligible intermediaries; and extends
repayment terms to seven years for Microloans of $10,000 or
less and to ten years for Microloans greater than $10,000.
Legislative History
H.R. 6079 was introduced on March 4, 2020 by
Representatives Andy Kim (D-NJ) and Tim Burchett (R-TN). H.R.
6079 was ordered to be reported by voice vote by the House
Committee on Small Business on March 11, 2020 and passed by the
House on September 14, 2020 under Suspension of the Rules by
voice vote. H.R. 6079 was received in the Senate and read twice
and referred to the Committee on Small Business and
Entrepreneurship on September 15, 2020.
STEP IMPROVEMENT ACT OF 2020
H.R. 6133
Summary
H.R. 6133 reauthorizes the State Trade Expansion Program
(STEP) for four fiscal years, FY 2021 through FY 2024, and
makes improvements to the program. Specifically, H.R. 6133
mandates the creation of a standardized application process,
increases grant spending flexibility, improves communication
between the Small Business Administration and States. The bill
also requires the collection of performance metrics and an
annual report to Congress.
Legislative History
H.R. 6133 was introduced on March 4, 2020, by
Representative Abby Finkenauer (D-IA) and Representative Ross
Spano (R-FL). H.R. 6133 was ordered to be reported by voice
vote by the House Committee on Small Business on March 11, 2020
and passed the House by voice vote under Suspension of the
Rules on September 14, 2020. H.R. 6133 was received in the
Senate and read twice and referred to the Committee on Small
Business and Entrepreneurship on September 15, 2020.
MICROLOAN EMERGENCY ASSISTANCE ACT OF 2020
H.R. 6291
Summary
H.R. 6291 expands the Microloan Program of the Small
Business Administration (SBA). Specifically, the bill increases
the amount of funds available to an individual loan
intermediary (i.e., a recipient of SBA direct loans that, in
turn, makes microloans to startups and newly established or
growing small businesses). The bill also makes eligible for
certain technical assistance grants an intermediary that, among
other requirements, provides at least 25% of its loans to small
businesses in an economically distressed area.
In addition, the bill temporarily (1) extends repayment
terms for microloans, and (2) authorizes the SBA to provide
increased amounts for both technical assistance grants and
direct loans. The bill also requires the SBA to temporarily
waive (1) the requirement that an intermediary contribute non-
federal funds as a condition of receiving a technical
assistance grant, and (2) the limitation on amounts allowed to
be expended to provide certain information and technical
assistance.
Legislative History
H.R. 6291 was introduced on March 19, 2020 by
Representative Andy Kim (D-NJ). A similar provision was
included in H.R. 925, as amended, the Heroes Act as Section 605
of Division E. H.R. 925, as amended passed the House under
Suspension of the Rules by a vote of 214-207 (Roll Call No.
214) on October 1, 2020. A similar provision was included in
H.R. 133, as amended, the Consolidated Appropriations Act, 2021
as Section 329 of Title III of Division N. H.R. 133, as amended
passed the House on December 21, 2020 by a vote of 327-85 (Roll
Call No. 250) and a vote of 359-53 (Roll Call No. 251), passed
by the Senate by a vote of 92-60 (Record Vote No. 289), and
signed by the President on December 27, 2020.
SBA REACHING ALL COMMUNITIES ACT OF 2020
H.R. 6301
Summary
H.R. 6301 amends the Small Business Act to require the
Small Business Administration to provide resources and services
to small businesses in the 10 most commonly spoken languages,
other than English, in the United States. This shall include
Mandarin, Cantonese, Japanese, and Korean.
Legislative History
H.R. 6301 was introduced on March 19, 2020 by
Representative Judy Chu (D-CA). A similar provision was
included in H.R. 748, the Coronavirus Aid, Relief, and Economic
Security Act or the CARES Act as Section 1111. H.R. 748, as
amended passed the Senate by a vote of 96-0 (Record Vote No.
80) on March 25, 2020, passed the House with the Senate
amendment under Suspension of the Rules by voice vote on March
27, 2020, and signed by the President on March 27, 2020
becoming Pub. Law. No. 116-136.
INCREASING ACCESS TO CAPITAL ACT OF 2020
H.R. 6303
Summary
H.R. 6303 requires the Small Business Administration (SBA)
to temporarily waive, or reduce to the maximum extent possible,
certain fees on SBA loans. The bill also temporarily increases
the guarantee amount and loan size for certain SBA loans,
including express loans, and it permanently waives the
guarantee fee on SBA loans for veterans.
Legislative History
H.R. 6303 was introduced on March 19, 2020 by
Representative Jason Crow (D-CO). A similar provision was
included in H.R. 925, as amended, the Heroes Act in Title VI of
Division E.
H.R. 925, as amended passed the House under Suspension of
the Rules by a vote of 214-207 (Roll Call No. 214) on October
1, 2020. A similar provision was included in H.R. 133, as
amended, the Consolidated Appropriations Act, 2021 as Section
326, 327, and 328 of Title III of Division N.
H.R. 133, as amended passed the House on December 21, 2020
by a vote of 327-85 (Roll Call No. 250) and a vote of 359-53
(Roll Call No. 251), passed by the Senate by a vote of 92-60
(Record Vote No. 289), and signed by the President on December
27, 2020.
SMALL BUSINESS REPAYMENT RELIEF ACT OF 2020
H.R. 6304
SUMMARY
H.R. 6304 amends the Small Business Act to require the
Small Business Administration (SBA) to pay the principal,
interest, and any associated fees owed on certain loans made to
small businesses for a six-month period. The SBA must also
encourage the Federal Deposit Insurance Corporation, the Office
of the Comptroller of the Currency, and state bank regulators
to not require lenders to increase their reserves on account of
receiving such payments made by the SBA. The SBA shall waive
statutory limits on maximum loan maturities for certain loan
durations where the lender provides a deferral and extends the
maturity of such loans and, when necessary to provide more time
because of difficulties during the COVID-19 (i.e., coronavirus
disease 2019) pandemic, extend lender site visit requirements.
Legislative History
H.R. 6304 was introduced on March 19, 2020 by
Representative Antonio Delgado (D-NY). A similar provision was
included in H.R. 748, the Coronavirus Aid, Relief, and Economic
Security Act or the CARES Act as Section 1112. H.R. 748, as
amended passed the Senate by a vote of 96-0 (Record Vote No.
80) on March 25, 2020, passed the House with the Senate
amendment under Suspension of the Rules by voice vote on March
27, 2020, and signed by the President on March 27, 2020
becoming Pub. Law. No. 116-136.
SMALL BUSINESS COVID-19 RECOVERY GRANTS ACT OF 2020
H.R. 6343
Summary
H.R. 6343 amends the Small Business Act to require the
Small Business Administration to provide grants to small
businesses that have suffered substantial economic injury as a
result of COVID-19 (i.e., coronavirus disease 2019). Such
grants may not exceed a specified amount and may be used to
address direct effects of COVID-19, including (1) providing
paid sick leave to employees, (2) maintaining payroll, and (3)
meeting increased supply chain costs.
Legislative History
H.R. 6343 was introduced on March 23, 2020 by
Representative Adriano Espaillat (D-NY). A similar provision
was included in H.R. 925, as amended, the Heroes Act as Section
405 of Division E. H.R. 925, as amended passed the House under
Suspension of the Rules by a vote of 214-207 (Roll Call No.
214) on October 1, 2020. A similar provision was included in
H.R. 133, as amended, the Consolidated Appropriations Act, 2021
as Sections 331 and 332 of Title III of Division N. H.R. 133,
as amended passed the House on December 21, 2020 by a vote of
327-85 (Roll Call No. 250) and a vote of 359-53 (Roll Call No.
251), passed by the Senate by a vote of 92-60 (Record Vote No.
289), and signed by the President on December 27, 2020.
EXPEDITING THE EIDL PROGRAM ACT OF 2020
H.R. 6344
Summary
H.R. 6344 amends the Small Business Act to modify the
disbursement of economic injury disaster loans by the Small
Business Administration (SBA) with respect to such loans made
in response to COVID-19 (i.e., coronavirus disease 2019).
Specifically, the bill authorizes the SBA to increase the
amount of a disaster loan to a small business by 20% to cover
costs related to continuity of operations and risk mitigation
improvements. The bill also authorizes the SBA to make such
loans to startups and to waive rules related to affiliation,
and it requires the SBA to waive the personal guarantee
requirement on such loans made to cooperatives.
In addition, an applicant for a disaster loan may request
an advance on such loan up to a specified amount, and they
shall not be required to repay any amount of an advance if they
are subsequently denied a disaster loan. The bill also
authorizes the SBA to approve an applicant for a disaster loan
that is below a certain amount based solely on the applicant's
credit score and to use alternative methods to determine such
applicant's ability to repay. Further, the bill establishes a
maximum interest rate on a disaster loan based on an
applicant's ability to obtain credit elsewhere, and it expands
the qualifying events for which a disaster loan may be awarded
to include emergencies involving federal primary
responsibility.
Legislative History
H.R. 6344 was introduced on March 23, 2020 by
Representative Dwight Evans (D-PA). A similar provision was
included in H.R. 748, the Coronavirus Aid, Relief, and Economic
Security Act or the CARES Act as Section 1110. H.R. 748, as
amended passed the Senate by a vote of 96-0 (Record Vote No.
80) on March 25, 2020, passed the House with the Senate
amendment under Suspension of the Rules by voice vote on March
27, 2020, and signed by the President on March 27, 2020
becoming Pub. Law. No. 116-136.
STEP REIMBURSEMENT ACT OF 2020
H.R. 6345
Summary
H.R. 6345 amends the Small Business Act to require the
Small Business Administration to reimburse any recipient of a
grant under the State Trade Expansion Program for financial
losses relating to a foreign trade mission or a trade show
exhibition that was cancelled due to COVID-19 (i.e., the
coronavirus disease 2019). In addition, the bill authorizes a
state that receives a grant under the program to revise their
budget plan under certain circumstances.
Legislative History
H.R. 6345 was introduced on March 23, 2020 by
Representative Abby Finkenauer (D-IA). A similar provision was
included in H.R. 748, the Coronavirus Aid, Relief, and Economic
Security Act or the CARES Act as Section 1104. H.R. 748, as
amended passed the Senate by a vote of 96-0 (Record Vote No.
80) on March 25, 2020, passed the House with the Senate
amendment under Suspension of the Rules by voice vote on March
27, 2020, and signed by the President on March 27, 2020
becoming Pub. Law. No. 116-136.
CONTINUITY OF BUSINESS OPERATIONS SUPPORT ACT OF 2020
H.R. 6349
Summary
H.R. 6349 amends the Small Business Act to require the
Small Business Administration (SBA) to provide grants to small
business development centers, women's business centers, and
chapters of the Service Corps of Retired Executives to educate
and advise small businesses on specified matters related to
COVID-19 (i.e., coronavirus disease 2019). The SBA must
establish goals and metrics for the use of such funds awarded
to small business development centers, which shall (1) consider
the extent of the circumstances relating to the spread of
COVID-19 that affect small businesses served by grant
recipients, (2) ensure grant recipients have the flexibility to
respond to unique situations, and (3) encourage grant
recipients to develop and provide services to small businesses
in areas substantially affected by COVID-19.
Legislative History
H.R. 6349 was introduced on March 23, 2020 by
Representative Jared Golden (D-NE). A similar provision was
included in H.R. 748, the Coronavirus Aid, Relief, and Economic
Security Act or the CARES Act as Section 1103. H.R. 748, as
amended passed the Senate by a vote of 96-0 (Record Vote No.
80) on March 25, 2020, passed the House with the Senate
amendment under Suspension of the Rules by voice vote on March
27, 2020, and signed by the President on March 27, 2020
becoming Pub. Law. No. 116-136.
ENTREPRENEURIAL DEVELOPMENT COVID-19 RESPONSE ACT OF 2020
H.R. 6367
Summary
H.R. 6367 amends the Small Business Act to require the
Small Business Administration to award grants for small
business development centers, women's business centers, and
chapters of the Service Corps of Retired Executives to provide
small businesses with specified assistance related to COVID-19
(i.e., coronavirus disease 2019).
Legislative History
H.R. 6344 was introduced on March 23, 2020 by
Representative Bradley Schneider (D-IL). A similar provision
was included in H.R. 748, the Coronavirus Aid, Relief, and
Economic Security Act or the CARES Act as Section 1105. H.R.
748, as amended passed the Senate by a vote of 96-0 (Record
Vote No. 80) on March 25, 2020, passed the House with the
Senate amendment under Suspension of the Rules by voice vote on
March 27, 2020, and signed by the President on March 27, 2020
becoming Pub. Law. No. 116-136.
INCREASING ACCESS TO CAPITAL ACT OF 2020
H.R. 6697
Summary
H.R. 6697 modifies the Paycheck Protection Program
implemented by the Small Business Administration in response to
COVID-19 (i.e., coronavirus disease 2019) to include certain
entities and exclude certain individuals. Specifically, the
bill expands the program to encompass organizations with 300 or
fewer employees that (1) operate under section 501(c)(6) of the
Internal Revenue Code (other than a professional football
league), or (2) are a destination marketing organization
engaged in promoting communities and facilities to businesses
and leisure travelers. The bill also narrows the definition of
payroll costs under the program to exclude any compensation of
an employee who is a registered lobbyist from the calculation
for loan amounts or for allowable uses of funds provided under
the program.
Legislative History
H.R. 6697 was introduced on May 5, 2020 by Representative
Chris Pappas (D-NH), Representative Gilbert Cisneros (D-CA),
Representative Brian Fitzpatrick (R-PA), and Representative
Gregory Steube (R-FL). A similar provision was included in H.R.
925, as amended, the Heroes Act in Section 204 of Division E.
H.R. 925, as amended passed the House under Suspension of the
Rules by a vote of 214-207 (Roll Call No. 214) on October 1,
2020. A similar provision was included in H.R. 133, as amended,
the Consolidated Appropriations Act, 2021 as Section 318 of
Title III of Division N. H.R. 133, as amended passed the House
on December 21, 2020 by a vote of 327-85 (Roll Call No. 250)
and a vote of 359-53 (Roll Call No. 251), passed by the Senate
by a vote of 92-60 (Record Vote No. 289), and signed by the
President on December 27, 2020.
TO AMEND THE SMALL BUSINESS ACT TO INCLUDE CERTAIN CRITICAL ACCESS
HOSPITALS IN THE PAYCHECK PROTECTION PROGRAM, AND FOR OTHER PURPOSES
H.R. 6716
Summary
H.R. 6716 expands the Paycheck Protection Program,
established to support small businesses in response to COVID-19
(i.e., coronavirus disease 2019), to encompass critical access
hospitals. A critical access hospital is a hospital that, among
other things, is located in a rural area, furnishes 24-7
emergency services, and has 25 or fewer inpatient beds.
Legislative History
H.R. 6716 was introduced on May 5, 2020 by Representative
Jared Golden (D-ME). A similar provision was included in H.R.
925, as amended, the Heroes Act in Section 204 of Division E.
H.R. 925, as amended passed the House under Suspension of the
Rules by a vote of 214-207 (Roll Call No. 214) on October 1,
2020.
SMALL BUSINESS TRANSPARENCY AND REPORTING FOR THE UNDERBANKED AND
TAXPAYERS AT HOME ACT OR THE TRUTH ACT
H.R. 6782
Summary
H.R. 6782 requires the Small Business Administration (SBA)
to make information regarding economic relief measures
implemented in response to COVID-19 (i.e., coronavirus disease
2019) publicly available. Specifically, with respect to the
Paycheck Protection Program and economic injury disaster loans
and emergency grants, the SBA must publish (1) the identity of
each recipient of assistance and an explanation of the
decision-making process underlying such disbursal; (2) the
number of employees of each recipient and the date on which
such assistance was disbursed; (3) an identification of each
lender or intermediary through which assistance was disbursed;
and (4) the amount of assistance disbursed to small businesses
owned and controlled by socially and economically disadvantaged
individuals, women, and veterans.
Legislative
History H.R. 6782 was introduced on May 8, 2020 by
Representative Dean Phillips (D-MN), Representative J. Luis
Correa (D-CA), Representative Janice Schakowsky (D-IL),
Representative Lucille Roybal-Allard (D-CA), Representative Tom
Malinowski (K-NJ), Representative Abigail Spanberger (D-VA),
Representative Josh Gottheimer (D-NJ), Representative John
Garamendi (D-CA), Representative Gregorio Sablan (D-MP),
Representative Betty McCollum (D-MN), and Representative Debra
Haaland (D-NM). H.R. 6782 failed the House on May 28, 2020
under Suspension of the Rules by a vote of 269-147 (Roll Call
No. 113).
FAIR CHANCE FOR SMALL BUSINESS RELIEF ACT
H.R. 6894
Summary
H.R. 6894 prohibits the Small Business Administration from
declining to provide or guarantee certain small business loans
solely on the basis that an applicant (1) is on probation or
parole, (2) is presently subject to a means by which formal
criminal charges are brought (e.g., indictment or arraignment),
or (3) has been arrested or convicted of any crime.
Legislative History
H.R. 6894 was introduced on May 15, 2020 by Representative
Joyce Beatty (D-OH). A similar provision was included in H.R.
925, as amended, the Heroes Act as Section 218 of Division E.
H.R. 925, as amended passed the House under Suspension of the
Rules by a vote of 214-207 (Roll Call No. 214) on October 1,
2020.
LOCAL NEWS AND EMERGENCY INFORMATION ACT OF 2020
H.R. 6897
Summary
H.R. 6897 expands the Paycheck Protection Program,
established to support small businesses in response to COVID-19
(i.e., coronavirus disease 2019), to include certain newspaper
publishers, radio stations, and television broadcasters.
Specifically, such a media purveyor is eligible to receive a
paycheck protection loan if (1) the individual physical
location that applies for the loan does not exceed Small
Business Administration size standards (up to 1,000 employees
for newspaper publishers and $41.5 million in gross receipts
for radio and television broadcasters); and (2) the proceeds of
the loan are used to support the continued provision of local
news, information, content, or emergency information. Such a
recipient may not remit any portion of a paycheck protection
loan to any entity other than the individual physical location
that is the loan's intended recipient.
Legislative History
H.R. 6897 was introduced on May 15, 2020 by Representative
David Cicilline (D-RI) and Representative James Sensenbrenner
(R-WI). A similar provision was included in H.R. 925, as
amended, the Heroes Act as Section 204 of Division E. H.R. 925,
as amended passed the House under Suspension of the Rules by a
vote of 214-207 (Roll Call No. 214) on October 1, 2020. A
similar provision was included in H.R. 133, as amended, the
Consolidated Appropriations Act, 2021 as Section 317 of Title
III of Division N. H.R. 133, as amended passed the House on
December 21, 2020 by a vote of 327-85 (Roll Call No. 250) and a
vote of 359-53 (Roll Call No. 251), passed by the Senate by a
vote of 92-60 (Record Vote No. 289), and signed by the
President on December 27, 2020.
RELIEF FOR MAIN STREET ACT
H.R. 6907
Summary
H.R. 6907 establishes for one year the Small Business Local
Relief Program, which shall allocate resources to states, local
governments, and Native American tribes for providing
assistance to certain small businesses and nonprofits that have
lost revenue due to COVID-19 (i.e., coronavirus disease 2019).
Specifically, the bill provides $50.5 billion for such
assistance, of which (1) $35 billion shall be distributed based
on the Community Development Block Grant formula (70% allocated
to larger cities and counties and 30% to rural communities),
(2) $15 billion shall be allocated to provide financing
exclusively to businesses in rural areas, and (3) $500 million
shall be for Native American Tribes.
These amounts shall be used to start or scale a local small
business emergency fund or to support organizations that
provide technical assistance to small businesses or nonprofits.
Such local funds or organizations may then use the amounts to
assist small businesses (including sole proprietorships,
independent contractors, and self-employed individuals) and
nonprofits that (1) employ no more than 20 full-time employees
(50 if the recipient is located in a low-income community), (2)
has experienced a loss of revenue because of COVID-19, and (3)
satisfies any additional requirements imposed by the
administrator of the fund. A state, local government, or Native
American tribe that receives funds under the bill must report
specified demographic and disbursement information.
Legislative History
H.R. 6907 was introduced on May 15, 2020 by Daniel Kildee
(D-MI) and Representative Brian Fitzpatrick (R-PA). A similar
provision was included in H.R. 925, as amended, the Heroes Act
as Section 618 of Division E. H.R. 925, as amended passed the
House under Suspension of the Rules by a vote of 214-207 (Roll
Call No. 214) on October 1, 2020.
PPE ACT
H.R. 6973
Summary
H.R. 6973 modifies allowable and forgivable uses of amounts
received under the Paycheck Protection Program, established to
support small businesses in response to COVID-19 (i.e.,
coronavirus disease 2019), to encompass costs related to the
provision of personal protective equipment or other equipment
or supplies necessary to protect the health and safety of
employees. The bill also prohibits the Small Business
Administration from limiting the non-payroll portion of a
forgivable loan amount.
Legislative History
H.R. 6973 was introduced on May 22, 2020 by Representative
Abby Finkenauer (D-IA) and Representative Aumua Amata Coleman
Radewagen (R-AS). A similar provision was included in H.R. 925,
as amended, the Heroes Act in Section 206 of Division E. H.R.
925, as amended passed the House under Suspension of the Rules
by a vote of 214-207 (Roll Call No. 214) on October 1, 2020. A
similar provision was included in H.R. 133, as amended, the
Consolidated Appropriations Act, 2021 as Section 304 of Title
III of Division N. H.R. 133, as amended passed the House on
December 21, 2020 by a vote of 327-85 (Roll Call No. 250) and a
vote of 359-53 (Roll Call No. 251), passed by the Senate by a
vote of 92-60 (Record Vote No. 289), and signed by the
President on December 27, 2020.
PAYCHECK PROTECTION PROGRAM FLEXIBILITY ACT OF 2020
H.R. 7010
Summary
H.R. 7010 modifies provisions related to the forgiveness of
loans made to small businesses under the Paycheck Protection
Program implemented in response to COVID-19 (i.e., coronavirus
disease 2019). Specifically, the bill establishes a minimum
maturity of five years for a paycheck protection loan with a
remaining balance after forgiveness. The bill also extends the
covered period during which a loan recipient may use such funds
for certain expenses while remaining eligible for forgiveness.
The bill raises the non-payroll portion of a forgivable covered
loan amount from the current 25% up to 40%.
The bill extends the period in which an employer may rehire
or eliminate a reduction in employment, salary, or wages that
would otherwise reduce the forgivable amount of a paycheck
protection loan. However, the forgivable amount must be
determined without regard to a reduction in the number of
employees if the recipient is (1) unable to rehire former
employees and is unable to to hire similarly qualified
employees, or (2) unable to return to the same level of
business activity due to compliance with federal requirements
or guidance related to COVID-19.
Additionally, the bill revises the deferral period for
paycheck protection loans, allowing recipients to defer
payments until they receive compensation for forgiven amounts.
Recipients who do not apply for forgiveness shall have 10
months from the program's expiration to begin making payments.
The bill also eliminates a provision that makes a paycheck
protection loan recipient who has such indebtedness forgiven
ineligible to defer payroll tax payments. Lastly, the bill is
designated as an emergency requirement pursuant to the
Statutory Pay-As-You-Go Act of 2010 (PAYGO) and the Senate
PAYGO rule.
Legislative History
H.R. 7010 was introduced on May 26, 2020 by Representative
Dean Phillips (D-MN) and Representative Chip Roy (R-TX). H.R.
7010 passed the House under Suspension of the Rules by a vote
of 417 1 (Roll Call No. 114), passed the Senate by voice vote,
and was signed into law on June 5, 2020 (Pub. Law No. 116-142).
P4 ACT
H.R. 7241
Summary
H.R. 7241 authorizes new lending under the Paycheck
Protection Program, established to support small businesses in
response to COVID-19 (i.e., coronavirus disease 2019), for
specified small businesses that have experienced a significant
loss in revenue. Specifically, the bill authorizes one
supplemental paycheck protection loan for a small business that
(1) has no more than 100 employees, (2) operates under a sole
proprietorship or as an independent contractor, or (3) is self-
employed. To be eligible for a supplemental paycheck protection
loan, such small business must demonstrate a loss of revenue of
50% or more and have either already expended an initial
paycheck protection loan or be on pace to exhaust such loan
prior to disbursal of the supplemental loan.
The bill also extends the application deadline for an
initial paycheck protection loan to December 31, 2020, and it
authorizes loan recipients to apply for forgiveness as early as
eight weeks after the loan's disbursal. The Small Business
Administration must (1) issue guidance instructing lenders of
paycheck protection loans to prioritize loan processing for and
disbursement to underserved businesses, (2) update the loan
application for paycheck protection loans to collect borrowers'
demographic information, and (3) publish specified program
information on its website.
Legislative History
H.R. 7241 was introduced on June 18, 2020 by Representative
Angie Craig (D-MN) and Representative Antonio Delgado (D-NY). A
similar provision was included in H.R. 925, as amended, the
Heroes Act in Section 202 of Division E. H.R. 925, as amended
passed the House under Suspension of the Rules by a vote of
214-207 (Roll Call No. 214) on October 1, 2020. A similar
provision was included in H.R. 133, as amended, the
Consolidated Appropriations Act, 2021 as Section 311 of Title
III of Division N. H.R. 133, as amended passed the House on
December 21, 2020 by a vote of 327-85 (Roll Call No. 250) and a
vote of 359-53 (Roll Call No. 251), passed by the Senate by a
vote of 92-60 (Record Vote No. 289), and signed by the
President on December 27, 2020.
FEDERAL SMALL BUSINESS CONTRACTOR PROMPT PAYMENT REPORTING ACT
H.R. 7342
Summary
H.R. 7342 amends the Small Business Act to require each
federal agency to report to Congress on the timeliness,
including acceleration, of payments made to a prime contractor
that is a small business or that subcontracts with a small
business.
Legislative History
H.R. 7342 was introduced on June 25, 2020 by Representative
Jason Crow (D-CO) and Representative Troy Balderson (R-OH).
H.R. 7342 was included in H.R. 6395, the William M. (Mac)
Thornberry National Defense Authorization Act for Fiscal Year
2021. H.R. 6395 was reported, as amended, by the House
Committee on Armed Services on June 9, 2020, and passed the
House on July 21, 2020, by a vote of 295-125 (Roll Call No.
152). H.R. 7342 was included in the final version of the
National Defense Authorization Act of 2020, (H.R. 6395).
PROTECTING SMALL BUSINESS CONTRACTING OPPORTUNITIES OF 2020
H.R. 7403
Summary
H.R. 7403 exempts certain contracts awarded to small
businesses from the procedural requirements of any federal rule
or guidance on category management or contract consolidation
and limits the inclusion of such contracts when measuring the
attainment of any federal goal or benchmark for category
management or contract consolidation. Such contracts are
government contracts awarded pursuant to Small Business
Administration programs that facilitate contracting with small
businesses owned by socially and economically disadvantaged
individuals or entities, women, or veterans, or are located in
historically underutilized business zones.
Legislative History
H.R. 7403 was introduced on June 29, 2020 by Representative
Chrissy Houlahan (D-PA) and Representative John Joyce (R-PA).
H.R. 7403 was included in H.R. 6395, the William M. (Mac)
Thornberry National Defense Authorization Act for Fiscal Year
2021. H.R. 6395 was reported, as amended, by the House
Committee on Armed Services on June 9, 2020, and passed the
House on July 21, 2020, by a vote of 295-125 (Roll Call No.
152). H.R. 7342 was not included in the final version of the
National Defense Authorization Act of 2020, (H.R. 6395).
SMALL BUSINESS CATEGORY MANAGEMENT TRAINING ACT
H.R. 7533
Summary
H.R. 7533 requires the Small Business Administration to
develop a training curriculum on category management, including
best practices for purchasing goods and services from small
businesses, for the staff of federal agencies with procurement
or acquisition responsibilities. Category management is a
federal government approach to procurement and acquisition that
aims to (1) deliver more savings, value, and efficiency for
federal agencies; (2) eliminate contract redundancies; and (3)
meet federal small business contracting and procurement goals.
Legislative History
H.R. 7533 was introduced on July 9, 2020 by Representative
John Joyce (R-PA). H.R. 7533 was included in H.R. 6395, the
William M. (Mac) Thornberry National Defense Authorization Act
for Fiscal Year 2021. H.R. 6395 was reported, as amended, by
the House Committee on Armed Services on June 9, 2020, and
passed the House on July 21, 2020, by a vote of 295-125 (Roll
Call No. 152). H.R. 7342 was included in the final version of
the National Defense Authorization Act of 2020, (H.R. 6395).
TO TEMPORARILY EXTEND PARTICIPATION IN THE 8(A) PROGRAM OF THE SMALL
BUSINESS ADMINISTRATION, AND FOR OTHER PURPOSES.
H.R. 7586
Summary
H.R. 7586 amends the Small Business Act to require the
Small Business Administration to allow any small business
participating in its 8(a) Business Development program to
extend participation by a period of one year. The 8(a) Business
Development program limits competition for certain government
contracts to small businesses that participate in the program.
Legislative History
H.R. 7586 was introduced on July 13, 2020 by Representative
Dwight Evans (D-PA) and Representative Ross Spano (R-PA). H.R.
7586 was included in H.R. 925, the Heroes Act. H.R. 925 passed
the House on a motion to concur in the Senate amendments with
an amendment agreed to by a vote of 214-207 (Roll Call No.
214). H.R. 7586 was included in H.R. 6395, the William M. (Mac)
Thornberry National Defense Authorization Act for Fiscal Year
2021. H.R. 6395 was reported, as amended, by the House
Committee on Armed Services on June 9, 2020, and passed the
House on July 21, 2020, by a vote of 295-125 (Roll Call No.
152). H.R. 7342 was included in the final version of the
National Defense Authorization Act of 2020, (H.R. 6395). A
similar provision was included in H.R. 133, as amended, the
Consolidated Appropriations Act, 2021 as Section 330 of Title
III of Division N. H.R. 133, as amended passed the House on
December 21, 2020 by a vote of 327-85 (Roll Call No. 250) and a
vote of 359-53 (Roll Call No. 251), passed by the Senate by a
vote of 92-60 (Record Vote No. 289), and signed by the
President on December 27, 2020.
PAYCHECK PROTECTION SMALL BUSINESS FORGIVENESS ACT
H.R. 7777
Summary
H.R. 7777 modifies loan forgiveness under the Paycheck
Protection Program established to support small businesses in
response to COVID-19 (i.e., coronavirus disease 2019).
Specifically, the bill provides for automatic forgiveness of a
paycheck protection loan that is not more than $150,000 if the
recipient submits a one-page form. Such form must allow a
recipient to submit specified demographic and expenditure
information, and certain individuals (e.g., the President, the
Vice President, or the head of an executive department) are not
eligible for such forgiveness. Further, the bill prohibits any
enforcement or other action against a lender relating to loan
origination, forgiveness, or guarantee based on the lender's
reliance on certifications or documentation submitted by a loan
applicant or recipient.
Legislative History
H.R. 7777 was introduced on July 24, 2020 by Representative
Chrissy Houlahan (D-PA) and Representative Fred Upton (R-MI). A
similar provision was included in H.R. 925, as amended, the
Heroes Act in Section 201 of Division E. H.R. 925, as amended
passed the House under Suspension of the Rules by a vote of
214-207 (Roll Call No. 214) on October 1, 2020. A similar
provision was included in H.R. 133, as amended, the
Consolidated Appropriations Act, 2021 as Section 307 of Title
III of Division N. H.R. 133, as amended passed the House on
December 21, 2020 by a vote of 327-85 (Roll Call No. 250) and a
vote of 359-53 (Roll Call No. 251), passed by the Senate by a
vote of 92-60 (Record Vote No. 289), and signed by the
President on December 27, 2020.
SAVE OUR STAGES ACT OR SOS ACT
H.R. 7806
Summary
H.R. 7806 authorizes the Small Business Administration
(SBA) to make grants to eligible live venue operators,
producers, promoters, or talent representatives to address the
economic effects of the COVID-19 (i.e., coronavirus disease
2019) pandemic on certain live venues. Specifically, the SBA
may make (1) an initial grant of up to $12 million dollars to
an eligible operator, promoter, producer, or talent
representative; and (2) a supplemental grant that is equal to
50% of the initial grant. An initial grant must be used for
costs incurred between March 1, 2020, and December 31, 2020,
but a supplemental grant may be used for expenses incurred
through June 30, 2021. Such grants shall be used for specified
expenses such as payroll costs, rent, utilities, and personal
protective equipment.
Legislative History
H.R. 7806 was introduced on July 27, 2020 by Representative
Peter Welch (D-VT) and Representative Roger Williams (R-TX). A
similar provision was included in H.R. 925, as amended, the
Heroes Act as Section 619 of Division E. H.R. 925, as amended
passed the House under Suspension of the Rules by a vote of
214-207 (Roll Call No. 214) on October 1, 2020. A similar
provision was included in H.R. 133, as amended, the
Consolidated Appropriations Act, 2021 as Section 324 of Title
III of Division N. H.R. 133, as amended passed the House on
December 21, 2020 by a vote of 327-85 (Roll Call No. 250) and a
vote of 359-53 (Roll Call No. 251), passed by the Senate by a
vote of 92-60 (Record Vote No. 289), and signed by the
President on December 27, 2020.
TO ESTABLISH THE COMMUNITY ADVANTAGE LOAN PROGRAM, AND FOR OTHER
PURPOSES
H.R. 7903
Summary H.R. 7903 amends the Small Business Act to
statutorily authorize the Small Business Administration's (SBA)
Community Advantage Loan Program for five years (FY2021-
FY2025). To expedite lending for seasoned Community Advantage
lenders, the bill also extends delegated lending authority to
Community Advantage lenders who have made at least seven
Community Advantage loans, and requires SBA to issue rules
allowing Community Advantage lenders in good standing with SBA
to maintain a three percent loan loss reserve ratio. To promote
healthy dialogue between program participants and SBA, the bill
also establishes a Community Advantage Working Group to develop
ongoing recommendations for SBA to effectively manage, support,
and promote the Community Advantage program, and establish
metrics to evaluate the program's impact on expanding access to
capital to underserved small businesses.
Legislative History
H.R. 7903 was introduced on July 31, 2020, by
Representative Judy Chu (D-CA). An amendment offered by Rep.
Jason Crow (D-CO) was agreed to by voice vote. An amendment
offered by Representative Ross Spano (R-FL) was agreed to by
voice vote. H.R. 7903 was ordered to be reported, as amended,
by the House Committee on Small Business on September 16, 2020
by voice vote. H.R. 7903 passed the House by voice vote under
Suspension of the Rules on December 3, 2020.
504 CREDIT RISK MANAGEMENT IMPROVEMENT ACT OF 2020
H.R. 8199
Summary
H.R. 8199 amends the Small Business Investment Act to shift
loan closing file review responsibilities to the Small Business
Administration's (SBA) Office of Credit Risk Management (OCRM),
and allows SBA to charge Certified Development Companies (CDCs)
a fee to cover the cost of oversight, which becomes effective
one year after enactment. H.R. 8199 also clarifies OCRM's
duties, as well as the enforcement actions OCRM may take
against a CDC, which are aligned with those enacted under the
7(a) Oversight Act of 2018. H.R. 8199 also directs SBA to issue
rules for CDC compliance with the National Environmental Policy
Act of 1969.
Legislative History
H.R. 8199 was introduced on September 11, 2020, by
Representative Dan Bishop (R-NC) and Representative Angie Craig
(D-MN). H.R. 8199 ordered to be reported by the House Committee
on Small Business on September 16, 2020 by voice vote. H.R.
8199 passed the House by voice vote under Suspension of the
Rules on December 3, 2020.
504 MODERNIZATION AND SMALL MANUFACTURER ACT OF 2020
H.R. 8211
Summary
H.R. 8211 amends the Small Business Investment Act to
increase the maximum loan amount for manufacturing loans from
$5.5 million to $6.5 million and require Small Business
Administration (SBA) District Offices to partner with SBA
Resource Partners to provide entrepreneurial development
assistance to small manufacturers. To make 504 loans more
affordable for small manufacturers, the bill also provides
decreased project costs and adjusts collateral requirements and
debt refinance parameters for small manufacturers. The bill
also streamlines numerous administrative processes associated
with the 504 loan closing process by allowing accredited
Certified Development Companies (CDCs) to perform a number of
closing-related tasks, such as correcting any borrower or
lender information on loan documents. The bill also creates an
``Express'' loan closing program for 504 loans under $500,000.
Legislative History
H.R. 8211 was introduced on September 11, 2020, by
Representative Angie Craig (D-MN) and Ranking Member Steve
Chabot (R-OH). Amendments were offered by Chairwoman Nydia
Velazquez (D-NY), Ranking Member Steve Chabot (R-OH), and
Representative Judy Chu (D-CA) and all agreed to by voice vote.
H.R. 8211 was ordered to be reported, as amended, by the House
Committee on Small Business on September 16, 2020 by voice
vote. H.R. 8211, as amended passed the House by voice vote
under Suspension of the Rules on December 3, 2020.
PARITY FOR HUBZONE APPEALS ACT OF 2020
H.R. 8229
Summary
H.R. 8229 directs the Small Business Administration (SBA)
to issue regulations, no later than a year after its enactment,
to grant the Office of Hearings and Appeals (OHA) jurisdiction
over HUBZone status appeals. Currently, OHA does not hear
appeals of HUBZone status protest determinations. Those appeals
are heard by the SBA's Associate Administrator of the Office of
Government Contracting & Business Development (AA/GCBD). The
purpose of the bill is to achieve parity and uniformity of
appeal processes between the HUBZone Program and the SDVOSB and
WOSB programs by shifting the responsibility to hear HUBZone
status appeals from the AA/GCBD to OHA. H.R. 8229 promotes
efficiency and guarantees expertise by providing OHA with
jurisdiction over all program status appeals. Finally, it
encourages transparency and consistency in opinions since OHA
opinions are published.
Legislative History
H.R. 8229 was introduced on September 11, 2020 by
Representative Aumua Amata Coleman Radewagen (R-AS) and
Representative Chrissy Houlahan (D-PA). H.R. 8229 was ordered
to be reported by the House Committee on Small Business on
September 16, 2020 by voice vote. H.R. 8229 passed the House by
voice vote under Suspension of the Rules on December 3, 2020.
SMALL BUSINESS DEBT RELIEF EXTENSION ACT OF 2020
H.R. 8376
Summary
H.R. 8376 extends and expands the debt relief for certain
SBA loans that was provided in the CARES Act. Specifically, the
bill extends for another six months to eighteen months loan
subsidy payments on SBA 7(a), 504, and microloans.
Legislative History
H.R. 8376 was introduced on September 24, 2020 by
Representative Antonio Delgado (D-NY). A similar provision was
included in H.R. 925, as amended, the Heroes Act as Section 602
of Division E. H.R. 925, as amended passed the House under
Suspension of the Rules by a vote of 214-207 (Roll Call No.
214) on October 1, 2020. A similar provision was included in
H.R. 133, as amended, the Consolidated Appropriations Act, 2021
as Section 325 of Title III of Division N. H.R. 133, as amended
passed the House on December 21, 2020 by a vote of 327-85 (Roll
Call No. 250) and a vote of 359-53 (Roll Call No. 251), passed
by the Senate by a vote of 92-60 (Record Vote No. 289), and
signed by the President on December 27, 2020.
A BILL TO EXTEND THE AUTHORITY FOR COMMITMENTS FOR THE PAYCHECK
PROTECTION PROGRAM AND SEPARATE AMOUNTS AUTHORIZED FOR OTHER LOANS
UNDER SECTION 7(A) OF THE SMALL BUSINESS ACT, AND FOR OTHER PURPOSES.
S. 4116
Summary
S. 4116 extends through August 8, 2020, the application
period for the Paycheck Protection Program established to
support small businesses in response to COVID-19 (i.e.,
coronavirus disease 2019).
Legislative History
S. 4116 passed the House under Unanimous Consent on July 1,
2020 and signed by the President on July 4, 2020 (Pub. Law No.
116-147) The House bill, H.R. 7437 was introduced on July 1,
2020 by Representative Angie Craig (D-MN).
EXPRESSING SUPPORT FOR THE DESIGNATION OF THE WEEK OF MAY 5, 2019
THROUGH MAY 11, 2019, AS ``NATIONAL SMALL BUSINESS WEEK'' TO CELEBRATE
THE CONTRIBUTIONS OF SMALL BUSINESSES AND ENTREPRENEURS IN EVERY
COMMUNITY IN THE UNITED STATES.
H. RES. 347
Summary
H. Res. 347 celebrates the contributions of small
businesses and entrepreneurs in every U.S. community and
supports the designation of National Small Business Week.
Further, it supports efforts to provide small businesses with
aid and assistance through certain programs and initiatives.
Legislative History
H. Res. 347 was introduced on May 1, 2019 by Chairwoman
Nydia Velazquez (D-NY) and Ranking Member Steve Chabot (R-OH)
and most members of the committee.
EXPRESSING SUPPORT FOR THE RECOGNITION AND CELEBRATION OF THE VITAL
ROLE OF SMALL BUSINESSES, ALONG WITH THE EFFORTS OF THE SMALL BUSINESS
ADMINISTRATION TO HELP AMERICANS START, BUILD, AND GROW BUSINESSES.
H. RES. 730
Summary
H. Res. 730 recognizes and celebrates small businesses by
(1) acknowledging the importance of promoting a business-
friendly environment for small business owners, (2) encouraging
young entrepreneurs to pursue their passions and create more
startup businesses, and (3) conveying appreciation for the ways
small businesses support their communities and workers.
Legislative History
H. Res. 730 was introduced on November 21, 2019 by
Chairwoman Nydia Velazquez (D-NY) and Ranking Member Steve
Chabot (R-OH) and all members of the committee.
EXPRESSING SUPPORT FOR THE DESIGNATION OF SEPTEMBER 22, 2020 TO
SEPTEMBER 24, 2020, AS ``NATIONAL SMALL BUSINESS WEEK'' TO HONOR THE
ENTREPRENEURIAL SPIRIT AND CONTRIBUTIONS OF SMALL BUSINESSES AND
ENTREPRENEURS IN THE UNITED STATES
H. RES. 1134
Summary
H. Res. 1134 celebrates the contributions of small
businesses and entrepreneurs in every U.S. community and
supports the designation of National Small Business Week.
Further, it supports efforts to provide small businesses with
aid and assistance through certain programs and initiatives.
Legislative History
H. Res. 1134 was introduced on September 24, 2020 by
Chairwoman Nydia Velazquez (D-NY) and Ranking Member Steve
Chabot (R-OH) and most members of the committee.
EXPRESSING SUPPORT FOR THE RECOGNITION AND CELEBRATION OF THE VITAL
ROLE OF SMALL BUSINESSES, ALONG WITH THE EFFORTS OF THE SMALL BUSINESS
ADMINISTRATION TO HELP AMERICANS START, BUILD, AND GROW BUSINESSES.
H. RES. 1235
Summary
H. Res. 1235 recognizes and celebrates small businesses by
(1) acknowledging the importance of promoting a business-
friendly environment for small business owners, (2) supporting
small firms through the COVID-19 crisis, (3) encouraging young
entrepreneurs to pursue their passions and create more startup
businesses, and (4) conveying appreciation for the ways small
businesses support their communities and workers.
Legislative History
H. Res. 1235 was introduced on November 20, 2020 by
Chairwoman Nydia Velazquez (D-NY) and Ranking Member Steve
Chabot (R-OH) and members of the committee.
OVERSIGHT SUMMARY
Clause 1(d) of Rule XI of the Rules of the House of
Representatives for the 116th Congress requires each standing
committee, not later than January 2 of each odd numbered year,
to submit to the House a report on the activities of that
committee, including a separate section summarizing the
oversight activities of that committee. The report shall also
include a delineation of any hearings held pursuant to clauses
2(n), (o), or (p) of Rule XI related to waste, fraud and abuse
in government programs.
PART A
Full Committee Hearings
First Session of the 116th Congress
THE SHUTDOWN: ECONOMIC IMPACT ON SMALL BUSINESSES
On Wednesday, February 6, 2019, the Committee on Small
Business held a hearing entitled: ``The Shutdown: Economic
Impact on Small Businesses.'' The hearing examined the impact
the partial government shutdown had on small businesses,
federal workers, contractors, and the general economy. The
hearing provided an opportunity for Members of the Committee to
hear directly from small business owners on how they were
impacted from shuttered agencies.
The witnesses for the hearing were: Dr. Matthew D. Shapiro,
Professor of Economics at the University of Michigan; Mr. Bill
Butcher, Founder of Port City Brewing Company; Ms. Heidi
Gerding, CEO of HeiTech Services, Inc. and Mr. Charles ``Tee''
Rowe, President and CEO of America's Small Business Development
Centers.
The witnesses expressed frustration and an inability to
operate at full capacity, while awaiting a full resolution that
can bring long-term certainty. Further, one witnesses outlined
the impact the shutdown had on staff moral and their financial
outlook for the remainder of the year. Dr. Matthew Shapiro, an
Economist from the University of Michigan, also provided an
analysis of what happens to family pocketbooks and consumer
spending when a prolonged government shutdown occurs.
SMALL BUSINESS PRIORITIES FOR THE 116TH CONGRESS
On Wednesday, February 13, 2019, the Committee on Small
Business held a hearing entitled: ``Small Business Priorities
for the 116th Congress.'' The hearing was intended to inform
future committee hearings, advocacy efforts, and legislative
priorities. The hearing gave Members of the Committee the
opportunity to hear from small business organizations and small
business owners on what priorities the 116th Congress should
focus on and provided the Committee with ideas about federal
policies that will help them grow their businesses.
The witnesses for the hearing were: Mr. John Arensmeyer,
Founder & CEO of Small Business Majority; Ms. Sabrina Parsons,
CEO of Palo Alto Software; Mr. J Kelly Conklin, CO-Owner &
Founder Foley Wait LLC; and Mr. Thomas M. Sullivan, Vice
President at Small Business Policy.
The panel discussed various policies, such as paid family
leave, and SBA programming that has allowed them and their
members to expand business operations, while also highlighting
areas of concern. Witnesses also highlighted the need for
updated access to reliable broadband for rural communities as a
way to address the declining startup rate in these areas.
SUPPORTING AMERICA'S STARTUPS: REVIEW OF THE SBA'S ENTREPRENEURIAL
DEVELOPMENT PROGRAMS
On Thursday, February 27, 2019, the Committee on Small
Business held a hearing titled: ``Supporting America's
Startups: Review of the SBA's Entrepreneurial Development
Programs.'' The hearing examined how the Small Business
Administration's (SBA) Entrepreneurial Development programs
work and offered Members of the Committee the opportunity to
review the major technical assistance programs.
The witnesses for the hearing were: Mr. Charles ``Tee''
Rowe, President and CEO of America's Small Business Development
Centers; Ms. Corinne Hodges, CEO, Association of Women Business
Centers; Mr. W. Kenneth Yancey, Jr. CEO, SCORE; and Ms.
Cherylynn Sagester, Director, Veterans Business Outreach
Center, Old Dominion University, Virginia.
The witnesses provided testimony detailing the history and
mission of each entrepreneurial development program, and they
also made specific recommendations to improve the programs. Mr.
Tee Rowe testified that the reauthorization of the Small
Business Development Center (SBDC) program is long overdue and
recommended that the Committee consider a proposal that would
increase the authorization level for SBDCs, strengthen the
collaboration between the Small Business Administration (SBA)
and SBDCs, clarify SBDC marketing and co-sponsorship
activities, and make several other changes. Ms. Hodges
testified that legislation to reauthorize the Women's Business
Centers (WBC) is necessary and certain changes were needed to
strengthen the program. Ms. Hodges would like the Committee to
consider proposals to increase the cap of $150,000 per center,
remove requirements that require centers to overmatch federal
funds, increase federal funds, and strengthen data to better
quantify the growth of women's entrepreneurship. Mr. Yancey
testified about the history, mission, and activities of the
SCORE program. More specifically, he discussed plans to
centralize the accounting system at the national level to
reduce the bookkeeping and reporting burdens for chapters, and
their efforts to centralize the social media program so
chapters could provide more counseling and mentoring. In
addition, Mr. Yancey discussed an appropriation request of
$13.5 million in funding for SCORE. Ms. Sagester testified in
support of the Boots to Business program and Veterans Business
Outreach Centers.
REBUILDING AMERICA: SMALL BUSINESS PERSPECTIVE
On Wednesday, March 6, 2019, the Small Business Committee
held a hearing titled: ``Rebuilding America: Small Business
Perspective.'' The hearing allowed Members of the Committee to
hear about the country's current infrastructure needs and how
small businesses can stand to benefit from a comprehensive plan
that includes surface, broadband, and water, among others.
Witnesses included Ms. Terri Williams, Director, SBDC
Procurement Technical Assistance Center, University of Texas at
San Antonio (UTSA), San Antonio, Texas; Mr. Tim Donovan, Senior
Vice President, Legislative Affairs, Competitive Carriers
Association, Washington, D.C.; Ms. Roseline Bougher, President,
A.D. Marble, King of Prussia, Pennsylvania (testify on behalf
of the American Council of Engineering Companies); and The
Honorable Kris Knochelmann, Judge Executive and President,
Ohio-Kentucky-Indiana Regional Council of Governments, Kenton
County, KY.
Ms. Williams testified that infrastructure powers
businesses, creates opportunities for communities, enables
trade, connects workers to their jobs, creates opportunities
for struggling communities and protects the nation from an
increasingly unpredictable natural environment. Her testimony
highlighted that adequate broadband connects small businesses
with customers, enables remote access to employees and improves
operations. Ms. Williams also testified about the importance of
government contracts for businesses in her area stating that
the federal establishment of business utilization goals is a
good start to rebuilding America's business economy.
Ms. Bougher testified that Congress has a unique
opportunity in 2019 to pass major infrastructure legislation to
modernize the nation's transportation, water, energy, and
communications systems to enhance U.S. competitiveness in the
global marketplace and provide robust contracting opportunities
for small businesses like hers. In addition, she mentioned
these will also provide local businesses with direct
contracting opportunities, and the flow-down effect helps
bolster other local economic activity as well. Mr. Knochelmann
emphasized that small businesses are the lifeblood of the
American economy but are also competing in a global economy. He
testified that this depends on the adequately performing road,
airports, and bridges mentioning that the current state of our
crumbling infrastructure is stifling economic growth.
FLIPPING THE SWITCH ON RURAL DIGITAL ENTREPRENEURSHIP
On Wednesday, March 13, 2019, the Committee on Small
Business held a hearing titled: ``Flipping the Switch on Rural
Digital Entrepreneurship.'' According to U.S. Census data, only
17 percent of businesses are located in rural areas despite 97
percent of the nation being classified as rural. The hearing
allowed Members of the Committee to review opportunities online
technology holds and examine the barriers rural small
businesses face.
Witnesses included Mr. Dana F. Connors, President and CEO,
Main State Chamber of Commerce, Augusta, ME, Testifying on
behalf of the Maine State Chamber; Mr. Bill Ingersoll, Founder,
Bikes, Trikes and Quads, Sloansville, NY; Ms. Afton Stout,
Founder, My Dinosaur Dreams, State Center, Iowa and Mr. Jake
Ward, President Connected Commerce Council, Washington, DC.
Ms. Connors' testimony focused on a report titled Unlocking
the Digital Potential of Rural America, that detailed how
digital tools are driving the success of small businesses in
rural America and the opportunity digital tools present for
entrepreneurs living in rural America. Specifically, her
testimony highlighted that digital technology boosts sales and
reduces costs for rural small businesses by helping businesses
expand their customer base in their own community, neighboring
states, and, in some cases, outside of the country as well. Mr.
Ingersoll highlighted as well that rural broadband is essential
to ensuring that rural small business owners and entrepreneurs
can take advantage of the latest technologies and reach
customers. He also testified about the importance of the U.S.
Postal Service. Small businesses rely on affordable, reliable
and universal postal service. He went to state that like
broadband, the US Postal Service is essential for all
Americans, no matter where they live, and without it, rural
small businesses will have a harder time competing with giant
e-commerce companies that have their own warehouses and
logistics networks. Ms. Stout testified that platforms like
Etsy represent a new face of entrepreneurship--87% are women,
and on average, these entrepreneurs are much younger than
traditional business owners.
UNLOCKING SMALL BUSINESS RETIREMENT SECURITY
On Wednesday, March 27, 2019, the Committee on Small
Business held a hearing titled: ``Unlocking Small Business
Retirement Security.'' The hearing examined retirement plan
options for small employers, the benefits and barriers they
face in offering plans, and options for expanding coverage for
their workers.
The witnesses for the hearing were Martella A. Turner-
Joseph, Founding Partner Joseph & Turner Consulting Actuaries,
LLC New York, NY Testifying on behalf of the American
Retirement Association; Mr. Paul F. Davidson Director, Product
Management Paychex, Inc. Rochester NY; Mr. Greg Gorgone CFO
Citizant, Inc Chantilly, Virginia, Testifying on behalf of the
U.S. Women's Chamber of Commerce and Mr. Keith Hall President
and Chief Executive Officer National Association for the Self-
Employed Washington, DC.
The hearing discussed how Congress can help more small
businesses provide their employees with affordable retirement
plans. Today, half of all small businesses do not have a
retirement plan set up and millions of workers have little
saved for their retirement. Witnesses testimony focused on
reversing this trend by looking at the possibilities of
reducing the student debt burden facing young professionals,
offering increased tax incentives to small business owners who
choose to sponsor a plan, exploring auto-enrollment, and
potentially allowing small firms to band together to offer
retirement plans which could lead to administrative savings and
reduced fiduciary liability.
NATIONAL SMALL BUSINESS WEEK: HONORING THE NATION'S SMALL BUSINESS
HEROES
On Wednesday, May 8, 2019 the Committee on Small Business
held a hearing titled: ``Honoring the Nation's Small Business
Heroes.'' The Small Business Administration (SBA) has
designated May 5-11 as its National Small Business Week. To
honor all of America's entrepreneurs, the House Small Business
Committee brought in business leaders from across the country
who exemplify the determination, hard work, and creativity that
showcases the American entrepreneurial spirit.
Witnesses included, Ms. Gia Giasullo Owner Brooklyn Farmacy
& Soda Fountain Brooklyn, NY; Ms. Amy Fox President &
Operations Spiral Brewery Hastings, MN; Mr. Nels Leader Vice
President Bread Alone Bakery Lake Katrine, NY; Mr. Robert
Hoffman Broker Robert Hoffman Realty Inc. Albert Lea, MN; Mr.
Jason Brochu President and Co-Owner Pleasant River Lumber
Dover-Foxcroft, ME; Mr. Kristofer Sabey President Surf Liquors
& Market Seaside Heights, NJ; Mr. Bill Skalish Owner Granite
Tech, Inc. and The Benchmark GRP, LLC Landenberg, PA; Mr. Jerry
Kortesmaki Owner London Road Rental Center Duluth, MN; Mr. Dave
Walton Farmer Iowa Soybean Association Wilton, IA; Ms. Brittney
Reese Co-Founder and Head FIT Coach FIT & NU Aurora, CO; Ms.
Colleen Cruze Bhatti Owner Cruze Farm Knoxville, TN; Mr. Shawn
Pulford CEO LB Water Chambersburg, PA.
The estimated 30 million small firms in the U.S., represent
99.7 percent of all employers and generate two-thirds of all
net new jobs. Members of Congress were able to hear directly
from small businesses across the country about the challenges
they face starting a small business, the rewarding experience
of building a successful company, and the impact they have on
their local communities. Witnesses testified that access to
affordable capital, finding and retaining talented workers,
accessing new customers, and competing against larger
competitors all provide headwinds for small business success.
They suggested, among other things, that Congress should expand
access to capital, workforce development and opportunities to
do business with the federal government.
MEMBER DAY HEARING: COMMITTEE ON SMALL BUSINESS
On Wednesday, May 15, 2019, the Committee on Small Business
held a hearing titled: ``Member Day Hearing: Committee on Small
Business.'' House Rules require that each Committee allow
Members of Congress to testify regarding jurisdictional issues
of each Committee that impacts their constituents.
Witnesses included the Honorable Ed Case Member of Congress
U.S. House of Representatives Washington, DC and the Honorable
Tony Cardenas Member of Congress U.S. House of Representatives
Washington, D.C.
Representative Case encouraged the Committee to enhance
programs that benefit minority owned small businesses such as
the 8a program especially for Asian & Pacific Islander
Americans. Among other things, Representative Cardenas
encourages the Committee to support programs and politics
bridge the skill gap between the available workforce and
employers by investing in funding programs that will encourage
the development of computer science career education programs
that meet the market needs of employers.
IMMIGRATION AND THE SMALL BUSINESS WORKFORCE
On Wednesday, May 22, 2019, the Committee on Small Business
held a hearing titled: ``Immigration and the Small Business
Workforce.'' Temporary and permanent immigration have long been
at the forefront of the national conversation, yet the labor
force needs of small businesses in this regard are often
overlooked. The hearing allowed Members of the Committee to
examine the current challenges small businesses face in hiring
qualified foreign labor and what legislative solutions would
help them.
Witnesses included Mr. Dan Wallace, Director of Special
Projects, New American Economy, New York, NY; Mr. Derek Shoare,
Senior Vice President, Challenger Sports, Lenexa, KS; Mr. Nick
Sabino, Founder, Deer Park Roofing Inc., Cincinnati, OH
(Testifying on behalf of the National Roofing Contractors
Association) and Mr. Daniel Griswold, Senior Research Fellow
and Co-Director, Trade and Immigration Project, Mercatus Center
at George Mason University, Arlington, VA.
Witnesses testified Immigrants not only help fill shortages
in the labor market, they also create jobs for Americans at
every skill level noting that although they represent roughly
13.7 percent of the U.S. population immigrants account for more
than 20 percent of all entrepreneurs. Witnesses also testified
there are not enough American workers available to work full
time in seasonal programs particularly in the agriculture,
construction, and hospitality industries. Witnesses suggested
reforming the nation's immigration system will help small
businesses and stimulate economic growth.
THE DOCTOR IS OUT: RISING STUDENT LOAN DEBT AND THE DECLINE OF SMALL
MEDICAL PRACTICE
On Wednesday, June 12, 2019, the Committee on Small
Business held a hearing titled: ``The Doctor is Out: Rising
Student Loan Debt and the Decline of Small Medical Practice.''
The hearing provided the Committee the opportunity to
understand the link between the growing student loan crisis and
the problems facing the medical community. This includes the
incentive structure for those exiting their Graduate Medical
Education (GME) or Residency and entering the workforce.
Witnesses included Ms. Sandy Norby PT, DPT, CEO of HomeTown
Physical Therapy, Des Moines, IA; Dr. Lauren Weise, Orthodontic
Resident, University of Maryland School of Dentistry,
Baltimore, MD; Dr. Tracy Henry, MD, MPH, MS, Assistant
Professor of Medicine, Emory University, Atlanta GA; Mr. Jason
Delisle, Resident Fellow, American Enterprise Institute.
Washington, D.C.
The Panel discussed how the growing student loan debt
crisis was affecting their decisions. Physicians have some of
the highest debt burden of anyone in the country, and that
adversely effects where they end up practicing medicine. Ms.
Norby's business model is to find physical therapists that grew
up in rural Iowa to come back to their hometown and practice
physical therapy there. She mentioned that it is hard to
convince them to come back because they will not be making
enough to pay back their student loans alongside managing a
business and affording a place to live. Dr. Weise noted that
many of her orthodontic colleagues are in upper-six-figure
debt, and the large amounts of debt she owes prevents her from
opening her own practice, and her husband from going to med
school. Dr. Henry testified to keep programs like Public
Service Loan Forgiveness (PSLF) from being undercut by the
Trump Administration because she is using them to pay off her
mountains of debt. The Republican witness, Jason Delisle, took
the opposite approach, arguing that those same programs should
be cut to nothing and done away with.
UNLOCKED POTENTIAL? SMALL BUSINESSES IN THE CANNABIS INDUSTRY
On Wednesday, June 19, 2019, the Committee on Small
Business held a hearing titled: ``Unlocked Potential? Small
Businesses in the Cannabis Industry.'' The hearing allowed
Members to learn about the opportunities the legitimate
cannabis industry presents for small businesses in states with
legal cannabis, as well as entrepreneurs from traditionally
underserved communities. The hearing also explored the
challenges currently faced by those ``direct'' cannabis
businesses, but also by so-called ``ancillary'' or ``indirect''
cannabis businesses that may not be directly involved in the
production or distribution of cannabis products but transact
with direct cannabis businesses.
Witnesses on the panel were: Ms. Shanita Penny, M.B.A.;
President of the Board of Directors, Minority Cannabis Business
Association, Washington, DC; Mr. Eric Goepel; Founder & CEO,
Veterans Cannabis Coalition, Walnut, CA; Ms. Dana Chaves;
Senior Vice President and Director of Specialty Banking, First
Federal Bank of Florida, Lake City, FL; and Mr. Paul Larkin;
John, Barbara, and Victoria Rumpel Senior Legal Research Fellow
in the Meese Center for Legal and Judicial Studies, The
Heritage Foundation, Washington, DC.
Ms. Penny testified on how the legal cannabis industry
presents significant business opportunities, especially for
people of color, as the underground market transitions into a
regulated business sector. However, onerous capital
requirements, restrictions on licensing for those with minor
drug-related offenses, and numerous other factors have limited
opportunities and success for minorities and other
disadvantaged groups in the legal cannabis industry. She
testified that a lack of access to capital contributes to the
widening ownership equity gap, and that access to SBA's loan
programs would help close the equity gap in the legal cannabis
industries and help keep cannabis revenues in the communities
suffering the greatest economic and social harms of the War on
Drugs.
Mr. Goepel testified that because of their regular
interaction with the federal government for healthcare,
education, housing, and employment, veterans find themselves
particularly impacted by federal cannabis prohibition. He also
testified that considering the synergy that veterans have long
maintained with cannabis, it is a disservice for government to
prevent those who served when called on from pursuing their
life and liberty. Ms. Chaves testified regarding her experience
as a community banker in two states with some form of legal
cannabis, and the challenges she's faced in delivering
financial services to legitimate cannabis-related businesses.
Mr. Larkin testified that if Congress were to legalize adult-
use cannabis, it should require that states own and manage
distribution facilities.
CRUSHED BY CONFESSIONS OF JUDGMENT: THE SMALL BUSINESS STORY
On Wednesday, June 26, 2019, the Committee on Small
Business held a hearing titled: ``Crushed by Confessions of
Judgment: The Small Business Story.'' The hearing allowed the
Committee to examine the practice of merchant cash advance
(``MCA'') companies requiring small businesses to sign a
confession of judgment as a condition of receiving a funds.
Members heard from a variety of witnesses detailing the
legalities of the practice, its use, and impact on small
business borrowers.
Witnesses on the panel were: Mr. Hosea H. Harvey, Law
Professor and Consumer Finance Law Expert, Philadelphia, PA;
Mr. Jerry Bush; Former Owner, JB Plumbing & Heating of
Virginia, Inc., Roanoke, VA; Mr. Shane Heskin, Partner, White
and Williams, LLP., Philadelphia, PA; and Mr. Benjamin R.
Picker, Shareholder, McCausland Keen + Buckman, Devon, PA.
Mr. Harvey testified that though current law generally
presumes that business-to-business transactions take place
between sophisticated parties on equal footing (unlike consumer
transactions), the theoretical line between consumer and
business credit transactions has blurred over time. He also
noted that a discrepancy among state laws (and silence in
federal law) on this issue has made the use of confessions of
judgment in small business lending ripe for abuse. Mr. Bush
testified regarding his experience as a business owner who was
approached by MCA companies that pressured him into taking out
one of their loan-like cash products and signing the
corresponding confession of judgment, which enabled the lender
to declare delinquency on the cash product and quickly obtain
repayment by draining his bank accounts.
Mr. Heskin testified regarding his experience as a
litigation attorney who has defended more than fifty small
businesses and individuals in connection with confessions of
judgment across the country. His testimony highlighted the
lengths to which MCA companies go to attempt to collect debts
allegedly owed, going so far as harassing borrowers and their
families. He also argued the Fair Debt Collection Practices Act
should apply to small business borrowers. Mr. Picker testified
that any legislation on confessions of judgment should be
limited to small business loans; should require the confession
of judgment provision be capitalized, bolded, and that a plain
language disclosure should be placed on the first page of the
contract; and should require that the confessed judgment be
filed only in the state where the borrower is located.
CONTINUING TO SERVE: FROM MILITARY TO ENTREPRENEUR
On Wednesday, July 10, 2019, the Committee on Small
Business held a hearing titled: ``Continuing to Serve: From
Military to Entrepreneur.'' The purpose of the hearing was to
discuss the role of veteran entrepreneurs in growing the
economy and examine legislative efforts to foster veteran
entrepreneurship.
The witnesses for the hearing were: Mr. Davy Leghorn,
Assistant Director for The American Legion; Mr. Scott M.
Davidson, Owner of GCO Consulting, Retired Army Captain; Ms.
Torrance Harrington Hart, Owner of Teak and Twine; and Ms.
Laurie Sayles, President and CEO of Civility Management
Solutions (CivilityMS).
The witnesses testified about their experiences with
veteran entrepreneurship and expressed support for legislative
initiatives, including the codification of the Boots to
Business program, improvements to the Military Reservist
Economic Injury Disaster Loan (MREIDL) program, and the SBA
assumption of the VA certification process for service-disabled
veteran-owned small businesses. Mr. Leghorn testified on behalf
of The American Legion supporting draft legislation for: the
codification of the Boots to Business program, calling it
``imperative to make a permanent fixture''; reform of the
MREIDL program to reflect more accurately current deployment
practices; and the SBA adoption of VA certifications. Mr.
Davidson's testimony expressed support for the Boots to
Business program and advocated for the SBA assumption of VA
certification on practical, track-record grounds. Ms. Hart
testified about her experiences as a veteran entrepreneur and
military spouse, and expressed support for the Boots to
Business program, particularly for military spouses. Military
spouses oftentimes forgo careers because of frequent moves,
which make it difficult to get established. Entrepreneurship
can help to overcome these barriers for military spouses. Ms.
Sayles testified in support of SBA assumption of VA
certifications for service-disabled veteran-owned small
business (SDVOSB), and advocated for greater transparency and
accountability in sub-contracting plans for government awarded
contracts.
FLOODED OUT: VANISHING ENVIRONMENTAL REVIEWS AND THE SBA'S DISASTER
LOAN PROGRAM
On Friday, July 19, 2019, in Wheeling, IL, the Committee on
Small Business met for a field hearing titled: ``Flooded Out:
Vanishing Environmental Reviews and the SBA's Disaster Loan
Program.'' They examined the utilization of the SBA's Disaster
Loan Program in the context of severe flooding that impacted
parts of Illinois in 2017. Members heard from a variety of
witnesses who will address how the floods impacted their local
communities.
The witnesses were Mr. Mark Warner, Executive Director,
Lake County Stormwater Management Commission, Lake County, IL;
Mr. Howard Learner, Executive Director, the Environmental Law &
Policy Center, Chicago, IL; and Mr. John Durning, Owner
Pizzeria Deville, Libertyville, IL.
Mr. Warner testified that Lake County has seen record
setting increases in flooding over the last three years and in
particular that the July 2017 flood set record high water
levels on all nine river gages throughout the County, caused
millions of dollars of damage and threatened the lives of many
residents and visitors. He also testified that communities
along the Des Plaines and Fox River watersheds have long faced
flooding issues during significant rain events. Since 2013
alone, Lake County has experience two ``100-year floods,'' and
6 of the 10 largest storm events on record have occurred since
1994. In July 2017, intense storms damaged more than 3,200
homes, resulting in a state of emergency declaration for the
region and causing millions of dollars in damage to the
community. As a result, after severe businesses in Lake County,
Illinois utilized SBA's disaster loans to rebuild and recover.
Mr. Durning, who owns Pizzeria DeVille in Libertyville,
testified that the 2017 floods destroyed equipment and shut
down parts of his restaurant for six weeks. Witnesses testified
that environmental reviews protect communities by studying in
advance the social, environmental, and economic harms that
could result from a construction project. With projections of
more severe future flooding across the country, the SBA
disaster loan program could face further unnecessary strain.
The hearing allowed Members of Congress to consider adapting
the program to face additional challenges related to increasing
disasters, and how compliance with required environmental
reviews can ensure the longevity of the SBA disaster program.
IS THE TAX CUTS AND JOBS ACT A HELP OR HINDRANCE TO MAIN STREET?
On Wednesday, July 24, 2019, the Committee on Small
Business held a hearing titled: ``Is the Tax Cuts and Jobs Act
a Help or Hinderance to Main Street?'' The hearing examined how
the Tax Cuts and Jobs Act has affected small businesses. The
Committee heard from a policy expert and small businesses
testified how the current tax law has impacted them, and what
outstanding issues still exist.
The witnesses included Ms. Jane Gravelle Senior Specialist
in Economic Policy Congressional Research Service Washington,
DC; Mr. Grafton H Willey, IV CPA and Small Business Owner Sole-
Proprietor Portsmouth, RI, testifying on behalf of the NSBA-
National Small Business Association and the RI Society of
CPA's; Mr. Muneer Baig Founder & CEO SYSUSA, Inc. Manassas, VA,
testifying on behalf of Small Business Majority; and Mr. Justin
Conger President Conger Construction Group Lebanon, OH.
Ms. Gravelle testified the tax bill can affect small
businesses through an increase in overall economic growth that
increases demand for their products. She went on to explain
that Although some claims were made for significant short-term
growth, with some sources claiming the tax cut would produce
enough growth to pay for itself, most analysts projected a
relatively small effect on the economy in the short run,
ranging from 0.1% to 0.8% of GDP in 2018. Mr. Willey testified
that there were good things in the Tax Cuts and Jobs Act (TCJA)
but negative things as well. He testified from a tax
simplification perspective, a key goal of tax reform for small
businesses, the TCJA was a ``dismal failure.'' He also
testified that in attempting to create parity between large
corporations and small businesses, the TCJA provided good
benefits to large corporations and left small businesses short
on the parity issue. Mr. Baig testified that TCJA failed to
deliver upon its promise for most Main Street small businesses,
including his to create more jobs.
UTILIZATION MANAGEMENT: BARRIERS TO CARE AND BURDENS ON SMALL MEDICAL
PRACTICES
On Wednesday, September 11, 2019, the Committee on Small
Business held a hearing titled: ``Utilization Management:
Barriers to Care and Burdens on Small Medical Practices.'' The
hearing provided the Committee the opportunity to understand
increasing costs and administrative burdens for doctors caused
by utilization management by insurance companies in the form of
prior authorization and step therapy. These practices cause
medical professionals to spend their time filling out
duplicative forms and sitting on hold with insurance company
representatives to argue that the patient should in fact get
the medication, device, or procedure prescribed by the doctor.
These programs affect the quality of care and prove overly
burdensome on many small medical practices.
Witnesses included Dr. Paul M. Harari, M.D., Professor and
Chairman, Department of Human Oncology, University of Wisconsin
School of Medicine and Public Health; Testifying on behalf of
the American Society for Radiation Oncology. Dr. David R.
Walega, M.D., MSCI, Associate Professor of Anesthesiology;
Chief, Division of Pain Medicine; Vice Chair for Research,
Department of Anesthesiology, Northwestern University Feinberg
School of Medicine; Testifying on behalf of the American
Society of Anesthesiology. Dr. John Cullen, M.D., President,
American Academy of Family Physicians. Dr. Howard Rogers, M.D.,
FAAD, Advanced Dermatology, Testifying on behalf of the
American Academy of Dermatology Association.
The Panel discussed how the growing burden of prior
authorization is distracting them from providing quality care
for their patients and causing an undue financial burden on
their practices. Dr. Harari testified that many of the
requirements enforced by insurance companies for prior
authorization do not align with the treatment codes set up by
the American Society for Radiation Oncology. Dr. Walega
testified about his patient, who was denied a simple, minimally
invasive surgery that would have saved her much pain and from
opioids, and spent months arguing with insurance companies for
her to get the surgery. Dr. Cullen testified about the many
hours of uncompensated administrative work associated with
prior authorization and how that hurts his small practice in a
town of 4,000 residents in Valdez, AK, where he is the primary
caregiver. Dr. Rogers, also testified to the growing burden on
physician practice and how this can negatively affect care and
the patient-physician relationship.
THE ROLE OF THE SBA 8(A) PROGRAM IN ENHANCING ECONOMIC OPPORTUNITIES
On September 18, 2019, the Committee on Small Business held
a hearing titled: ``The Role of the SBA 8(a) Program in
Enhancing Economic Opportunities.'' The hearing focused on
SBA's 8(a) program, which was designed as a business
development program to help disadvantaged businesses compete in
the federal marketplace. The hearing examined how the program
operates, the benefits to entrepreneurs and communities, and
steps Congress can take to improve the effectiveness of the
program.
The witnesses for the hearing were: Mr. Ralph C. Thomas
III, Executive Director Emeritus & Representative of the
National Association of Minority Contractors (NAMC) and Lawyer,
Law Offices of Ralph C. Thomas III PLLC, Washington, D.C.; Ms.
Dottie Li, Founder and CEO of Transpacific Communications,
Cheverly, MD; Mr. Clarence McAllister, CEO of Fortis Networks,
Phoenix, AZ; and Ms. Rebecca Askew, CEO & General Counsel,
Circuit Media LLC, Denver, CO.
The witnesses testified that the 8(a) program is one of the
Federal Government's primary vehicles to help develop socially
and economically disadvantage small businesses. Moreover, all
witnesses discussed the weaknesses and made recommendations to
improve the program. For example, many businesses start to gain
traction in the last years of the program, which substantially
reduces their ability to receive contracts and limits their
growth. To address these concerns, Mr. Thomas suggested a
follow-up survey to graduated 8(a) firms to understand their
rate of success and understand potential weaknesses in the
program. By contrast, Mr. McAllister suggested extending the
program beyond the current 9-year term.
Additionally, the witnesses emphasized the need to improve
small business assistance within the program. Mr. McAllister
recommended providing legal assistance to 8(a) contractors and
Ms. Askew recommended the creation of two 7(j) educational
tracks: one for those who are starting the program and another
one for those that are culminating it. Finally, the witnesses
highlighted the Mentor/Protege Program as an indispensable tool
to increase small business capacity and knowledge. However,
they also called attention to the importance of having proper
safeguards in the Mentor/Protege Program so that it can truly
serve its purpose.
SBA MANAGEMENT REVIEW: SMALL BUSINESS INVESTMENT COMPANY PROGRAM
On Thursday, September 26, 2019, the Committee on Small
Business held a hearing titled: ``SBA Management Review: Small
Business Investment Company Program.'' Committee members
learned more about the Small Business Investment Company (SBIC)
program, which is designed to incentivize increased debt and
equity financing to high-risk small businesses lacking access
to adequate capital from traditional sources. Members also
learned about the SBIC funds who deliver SBIC financing to
small businesses in need of patient capital, and the role they
play in creating jobs in their local communities. The hearing
explored the current administrative challenges facing the
program and its industry participants.
There were two witness panels. Mr. Joseph Shepard,
Associate Administrator for the Office of Investment and
Innovation at SBA, testified as the sole witness on the first
panel. Witnesses on the second panel were: Mr. Brett Palmer,
President, Small Business Investor Alliance; Mr. John Paglia,
Professor of Finance, Graziadio Business School--Pepperdine
University, Malibu, CA; Ms. Ronda Penn, Chief Financial
Officer, Raleigh, NC; and Mr. Walt Rodgers, Chief Executive
Officer, Family RV, Cincinnati, OH. The Committee also received
written testimony from Mr. Brian Lueger, Principal, Konza
Valley Capital, Inc., Overland Park, KS.
Mr. Shepard testified regarding program operations under
his tenure, which had been marred by industry reports of
serious delays in licensing, examinations, and other key
program components. He testified that his response to those
concerns was to have an ``intense focus'' on examinations, and
reported that by July 2018, statutory compliance with
examinations was 100%. Mr. Palmer's testimony summarized a
series of concerns and frustrations SBICs have felt during Mr.
Shepard's tenure, and reported that ``nearly all processes
involving the Associate Administrator are delayed, commonly for
exceedingly long periods of time.'' Mr. Paglia's testimony
summarized key findings from his three reports regarding the
positive role the SBIC program plays in job creation, and the
better diversity performance compared to the broader venture
capital and private equity community. Ms. Penn's testimony
offered the perspective of a SBIC with multiple licenses,
including the extensive limited partner network and the impact
her fund has had over 22 years. Mr. Rodgers' testimony offered
the perspective of the portfolio company (one that received a
SBIC investment), and how it enabled the company to grow
financially and expand geographically. Mr. Lueger's written
testimony focused on how a technical change to the programmatic
definition of ``leverageable capital'' would enable his fund
(an ``evergreen'' fund that re-invests gains from individual
investments back into the fund, instead of paying out the
fund's limited partners) to access more leverage from the SBA.
CLOSING THE DIGITAL DIVIDE: CONNECTING RURAL AMERICANS TO RELIABLE
INTERNET SERVICE
On Friday, October 4, 2019, at Columbia Greene Community
College in Hudson, NY, the Committee on Small Business met for
a field hearing titled: ``Closing the Digital Divide:
Connecting Rural Americans to Reliable Internet Service.'' The
hearing allowed Members to hear about the lack of broadband and
its impact on quality of life for rural Americans, low-income
communities, and minorities.
Witnesses included Mr. Tim Johnson, CEO, Otsego Electric
Cooperative, Edmeston, NY; Ms. Shannon Hayes, Owner, Sap Bush
Hollow Farm Store and Cafe, West Fulton, NY; Mr. David Berman,
Co-Chair, Columbia Connect Ghent, NY; Mr. Jason Miller, General
Manager, Delhi Telephone Company, Delhi, NY; Mr. Brian Dunn,
Superintendent, Middleburgh Central School District,
Middleburgh, NY; and Dr. Cliff Belden, Chief Medical Officer,
Columbia Memorial Health Hudson, NY.
Mr. Johnson testified that broadband is vital to the
survival and growth of both the communities his company serves
and all of rural America. He suggested that more granular and
accurate maps showing broadband availability are a key part of
reaching all rural Americans with high-speed broadband service.
Mr. Berman addressed the issue of closing the digital divide
head on. He testified the only solution to this issue is to
base local, state and federal programs on the goal of reaching
every address in the United States. He testified that means
eliminating using census blocks to define coverage,
availability, and financing because census blocks are both
confusing and lead to some bizarre results. Dr. Belden focuses
his testimony on three broad areas where the impact of
broadband is felt in the delivery of health care--patient care,
the location and types of services available in a facility and
a sometimes-unrecognized effect on our workforce. Mr. Miller
acknowledged the benefits that broadbands stating that it is
crucial to the current and future success of rural America.
However, he noted that small, rural telecom providers like his
company are deploying faster broadband throughout their service
areas, but no carrier--regardless of size--can deliver high-
speed, high-capacity broadband in rural America without the
business case to justify the investment.
SILICON PRAIRIE: TECH, INNOVATION, AND A HIGH-SKILLED WORKFORCE IN THE
HEARTLAND
On Tuesday, October 8, 2019, the Committee on Small
Business met at the Dr. Thomas R. Burke Technical Education
Center at Kansas City Community College in Kansas City, Kansas
for a field hearing titled: ``Silicon Prairie: Tech,
Innovation, and a High-Skilled Workforce in the Heartland.''
The field hearing was led by Representative Sharice Davids and
attended by Representative Emanuel Cleaver. It provided the
opportunities to focus on the tech boom happening in the
Midwest and how the U.S. should be training the workforce in
the area to satisfy the demand from tech employers. It also
provided the opportunity for small business owners, government
officials, and experts to provide innovative solutions to
combat the labor shortage.
In two panels there was a total of eight witnesses. The
first government panel included Mr. David Toland, Secretary,
Kansas Department of Commerce, Topeka, KS. Ms. Delia Garcia,
Secretary, Kansas Department of Labor, Topeka, KS. Mr. Thomas
Salisbury, Regional Administrator, Region VII, Small Business
Administration, Kansas City, MO. The second, private sector
panel included Ms. Neelima Parasker, President and CEO, SnapIT
Solutions, Overland Park, KS. Mr. Ruben Alonso III, President,
AltCap, Kansas City, MO. Ms. Tammie Wahaus, CEO, Elias Animal
Health, Olathe, KS. Mr. Brad Sandt, President & CEO, Menlo,
K12itc, Civic ITC, Kansas City, MO. Mr. Daniel Silva, President
& CEO, Kansas City Kansas Chamber of Commerce. Kansas City, KS.
The first panel focused mainly on things the government is
doing regarding workforce development, investing in schools and
education, and encouraging partnerships between businesses,
local governments and chambers of commerce, and educational
institutions to provide an education for in-demand skills that
can translate to jobs. The second panel talked largely about
many of the challenges small businesses face in hiring and how
they are investing in a workforce that has 21st century skills
and provides middle skill training for technology jobs to
people of all ages.
SBA MANAGEMENT REVIEW: SBA IG REPORT ON THE MOST SERIOUS MANAGEMENT AND
PERFORMANCE CHALLENGES FACING THE SBA
On Wednesday, October 16, 2019, the Committee on Small
Business held a hearing titled: ``SBA Management Review: SBA IG
Report on the Most Serious Management and Performance
Challenges Facing the SBA.'' The hearing focused on the Small
Business Administration Office of Inspector General's (OIG)
annual report on the most serious management and performance
issues within the agency. The hearing allowed Members the
opportunity to learn more about the significant issues that
could be addressed to enhance the effectiveness of the agency
and its programs.
The sole witness for the hearing was: Mr. Hannibal ``Mike''
Ware, Inspector General, United States Small Business
Administration, Washington, D.C.
The witness testified that SBA made progress addressing
that year's management challenges. The OIG stated that SBA made
concerted efforts to address outstanding internal control
recommendations and, as a result, fully implemented or made
substantial progress in 23 out of 25 challenge areas. Despite
this progress, the OIG testified that SBA still faces
significant ricks in loan program oversight and controls,
oversight of its statutory programs to promote small business
development and government contracting and deploying
information technology and related cybersecurity controls.
PRISON TO PROPRIETORSHIP: ENTREPRENEURSHIP OPPORTUNITIES FOR THE
FORMERLY INCARCERATED
On Wednesday, October 23, 2019, the Committee on Small
Business held a hearing titled: ``Prison to Proprietorship:
Entrepreneurship Opportunities for the Formerly Incarcerated.''
Many formerly incarcerated individuals face barriers to
reentering the workforce. Some employers hesitate to hire the
formerly incarcerated, which drastically reduces employment
possibilities and earnings potential. Entrepreneurship can help
overcome these barriers to employment and reduce recidivism.
The witnesses for the hearing were: Mr. Shon Hopwood,
Associate Professor of Law, Georgetown University Law Center,
Washington, D.C.; Mr. Gary Wozniak, President and Chief
Executive Officer (CEO), RecoveryPark, Detroit, MI; Ms. Corinne
Hodges, CEO, Association of Women's Business Centers,
Washington, D.C.; Jerry Blassingame, Founder and CEO, Soteria
CDC, Greenville, SC.
The witnesses discussed challenges facing incarcerated and
formerly incarcerated individuals and how entrepreneurship can
give them a second chance upon reentering society. Mr. Hopwood
expressed support for the Prison to Proprietorship bills, which
would require SBA's resource partners to provide
entrepreneurship services in-prison and to the formerly
incarcerated. After serving time in federal prison, Mr. Wozniak
spent three months actively seeking employment to no avail. To
overcome this challenge, he opened a pizza franchise, utilizing
the skills he gained as a stockbroker.
Ms. Hodges testified that many of the Women's Business
Centers offer specific training and resources to the formerly
incarcerated and described the services that several centers
currently provide. Moreover, she said that entrepreneurship has
the power to create pathways to success while reducing
recidivism. Mr. Blassingame discussed his experience upon being
released from prison, including the process of starting a
nonprofit that eventually helped with reentry. He found that
successful reentry included more than housing and jobs, it was
also family integration. The community must work together to
overcome issues pertaining to trauma, financial literacy, and
family reintegration. Mr. Hopwood, Mr. Wozniak, and Ms. Hodges
express support for the Prison to Proprietorship bills.
FORCE OF NATURE: THE POWER OF SMALL BUSINESSES IN AMERICA'S
RECREATIONAL INFRASTRUCTURE
On Wednesday, October 30, 2019, the Committee on Small
Business held a hearing titled: ``Force of Nature: The Power of
Small Businesses in America's Recreational Infrastructure.''
The economic prosperity of the nation is impacted by the
growing recreational and tourism sector, which is served by
many small businesses. Members were able to hear testimony on
the significance of the outdoor recreation sector which
produced over $400 billion in $400 billion in gross economic
output and supported over 5 million jobs nationwide in 2017.
Witnesses included Mr. Ray Rasker, Executive Director,
Headwaters Economics, MT; Mr. Frank-Paul Anthony King,
President and Chief Executive Officer, Temple Fork Outfitters
(TFO), Dallas, TX; Ms. Lindsey Davis, CEO, WYLDER, Salt Lake
City, UT; and Mr. John Wooden, Owner, River Valley Power &
Sport, Rochester, MN, testifying on behalf of the National
Marine Manufacturers Association.
Witnesses highlighted that outdoor recreation and tourism
supports communities across the country by generating hundreds
of billions in federal, state, and local tax revenue every year
and that the outdoor recreation industry has strong ties to
various vital economic sectors, including manufacturing,
retail, transportation, and tourism which are dominated by
small businesses. Mr. Rasker testified that more than 140
economic studies document the many ways that hiking and biking
trails, picnic areas, fishing access sites, and other
infrastructure contribute to local economies. Mr. King
highlighted the importance of conservation in promoting outdoor
recreation. Ms. Davis emphasized that upgrades to our public
lands will benefit small firms and local economies. She
testified that the health of our ecosystems relies on adequate
and organized public access and infrastructure by way of
trails, waterways and wildlife corridors. She went on to say
green and blue infrastructure will not only improve visitation,
but also make it possible for wildlife and watersheds to
continue to thrive and recreationalists to continue building a
lifelong relationship to the outdoors.
UPSKILLING THE MEDICAL WORKFORCE: OPPORTUNITIES IN HEALTH INNOVATION
On Wednesday, November 13, 2019, the Committee on Small
Business met for a hearing titled: ``Upskilling the Medical
Workforce: Opportunities in Health Innovation.'' This hearing
explored the exponential advancement of medical technology
including but not limited to telehealth, electronic health
records, robotics, and artificial intelligence and ways medical
professionals are trained to adapt to this rapid development
using simulations, robots, and augmented and virtual reality.
The focus was how to use this technology to cope for a number
of different problems emerging in healthcare, such as higher
costs, concentration of health services, higher administrative
and student loan burdens for physicians, and lack of access for
many in rural and under-resourced urban communities.
Witnesses included Dr. Matthew Conti, MD, Orthopaedic
Surgery Resident, Hospital for Special Surgery, New York City,
NY, Testifying on behalf of the American Academy of Orthopaedic
Surgeons (AAOS). Dr. Ingrid Zimmer-Galler, MD, Associate
Professor of Ophthalmology, Founding clinical Director, Office
of Telemedicine, Johns Hopkins University, Baltimore, MD,
Testifying on behalf of the American Academy of Ophthalmology.
Dr. Nancy Fahrenwald, PhD, RN, PHNA-BC, FAAN, Dean and
Professor, Texas A&M College of Nursing, Bryan, TX, Testifying
on behalf of the American Association of Colleges of Nursing.
Mr. Michael Hopkins, Founder and CEO, True Concepts Medical
Technologies, Cincinnati, OH.
Dr. Conti testified about the new technology used to train
Orthopaedic surgeons in the Hospital for Special Surgery in New
York City, one of the most technologically advanced hospitals
in the United States, such as robotics, simulations, and
virtual reality. Dr. Zimmer-Galler testified about the ability
of telemedicine to expand access to expand access to rural
areas that do not currently have access to care and the
innovative ways they are training ophthalmologists to use
telemedicine at Johns Hopkins. Dr. Fahrenwald testified to the
advanced simulations they use to train nursing students and how
expanding the scope of practice for advanced practice
registered nurses (APRNs) can fill in the gaps in rural areas
where doctors are short. Furthermore, APRNs can use
telemedicine to consult with doctors many miles away about
treatment plans for their patients. The Republican witness,
Michael Hopkins, testified to the advancement of medical
devices to save lives, like his own dual syringe technology
that can protect patients from sepsis.
A FAIR PLAYING FIELD? INVESTIGATING BIG TECH'S IMPACT ON SMALL BUSINESS
On Thursday, November 14, 2019, the Committee on Small
Business held a hearing titled: ``A Fair Playing Field?
Investigating Big Tech's Impact on Small Business.'' The
Internet has transformed American lives and spurred economic
growth for millions of small businesses due in large part to
powerful digital platforms, commonly referred to as Big Tech.
The hearing gave Members the opportunity to hear from both
large tech companies and small businesses about the
opportunities and challenges online platforms pose for
entrepreneurs and small firms.
Witnesses included: Mr. Dharmesh M. Mehta, Vice President,
Customer Trust and Partner Support, Seattle, WA; testifying on
behalf of Amazon, Inc.; Ms. Erica Swanson, Head of Community
Engagement for Grow with Google, Mountain View, CA; testifying
on behalf of Alphabet, Inc., Dr. Joe Kennedy, Senior Fellow,
Information Technology & Innovation Foundation, Washington,
D.C.; testifying on behalf of the Information Technology &
Innovation Foundation; Ms. Allyson Cavaretta, Director of Sales
& Marketing, Meadowmere Resort, Olgonquit, ME; Mr. Molson Hart,
CEO, Viahart Toy Co., Houston, TX; Mr. Harold Feld, Senior Vice
President, Public Knowledge, Washington, D.C.; Ms. Theo
Prodromitis, Co-Founder and CEO, Spa Destinations, Tampa, FL;
Mr. Jake Ward, President, Connected Commerce Council,
Washington, D.C. and Mr. Graham Dufault, Sr. Director of Public
Policy, ACT | The App Association, Washington, D.C.
Mr. Mehta testified that Amazon, by offering small and
medium-sized businesses a low cost way to reach customers
worldwide, and through our investments to support these
businesses, has lowered barriers to entry for entrepreneurs,
helps make retail even more vibrantly competitive, and
continues to delight customers with new innovations. Ms.
Swanson testified that Google tools help American businesses
find and connect with customers. In 2018, Google's search and
advertising tools helped provide $335 billion of economic
activity nationwide. More than 1.3 million businesses, website
publishers, and nonprofits benefited from using Google's
advertising solutions. Mr. Kennedy testified that Internet
platforms allow any business to set up a website, Facebook
page, Instagram account, YouTube channel and other online
presences to reach customers, exchange information, and build a
loyal customer base.
Mr. Hart testified that Amazon has created business
solutions that have enabled small businesses to reach and serve
new customers. However, he also testified that due to their
market dominance, can determine if a small business succeeds or
does not simply by allowing or not allowing it on its platform.
He stated ``if Amazon suspends us from the platform, we go
bust, and we go bust fast.'' Ms. Caveretta testified that
Google's most recent actions in the online travel ecosystem
present a serious threat to small business and how those
actions have harmed end consumers. She urged Congress to
address immediately Google's near monopoly access to market for
small business. Ms. Caveretta described in detail changes made
by Google's search algorithm that prioritizes larger online
travel companies and prioritizes those businesses that pay more
for advertising on the Google platform. Mr. Feld testified that
the dominance of a handful of massive companies in online
retail, online search, online video and social media creates
enormous problems for small businesses. He explained that small
businesses face potential obstacles when they potentially
compete with digital platforms citing reports that Amazon
harvests small business data and then creates competing
products. He also testified that Congress must set necessary
safeguards that balance providing a stable and competitive
environment for small businesses while preserving the valuable
features of digital platforms.
EMBRACING CORPORATE SOCIAL RESPONSIBILITY: SMALL BUSINESS BEST
PRACTICES
On Wednesday, December 4, 2019, the Committee on Small
Business met for a hearing titled: ``Embracing Corporate Social
Responsibility: Small Business Best Practices.'' This hearing
informed members about recent changes to corporate values in
the wake of the restatement by the Business Roundtable on the
purpose of a corporations from shareholder primacy to
stakeholder primacy. It elevated the concerns caused by
shareholder primacy such as environmental degradation,
stagnating wages, and lack of diversity and inclusion in upper
level management. Members heard from academics and small and
large business owners about the importance of businesses giving
back to their community.
Witnesses included Dr. Robert Strand, Executive Director of
the Center for Responsible Business and Lecturer at the
University of California, Berkeley's Haas School of Business.
Mr. Vincent Stanley, Director of Philosophy, Patagonia, Inc.
Ms. Kristy Wallace, CEO, Ellevate Network. Mr. Jaime Arroyo,
Associate, Work Wisdom LLC. Mr. Sean McElwee, President and
Chief Creative Officer, Seanese; Accompanied by Ms. Sandra
McElwee, Chief Dream Facilitator, Seanese.
Dr. Strand testified about what the United States can learn
from the stakeholder primacy that many Scandinavian countries
have embraced for decades to invest much of their profits back
in their workers and communities rather than just their owners.
Mr. Stanley shared the experiences of Patagonia over the past
40 years and their journey of becoming a more environmentally
responsible company. He also explained the legal framework of
benefit corporations and how they can create a competition to
be more sustainable and retain sustainability through transfer
of ownership. Ms. Wallace testified about the importance of
investing in women owned businesses and creating a network of
support for women entrepreneurs. Mr. Arroyo echoed this
sentiment and added the importance of diversity and inclusion.
Mr. McElwee and his mom, Sandra, testified about the importance
of companies--even microbusinesses like his own--to give back
to their communities and dedicate a portion of their profits to
charitable organizations and acts, like his own baby onesie
initiative for new parents with children with Down syndrome.
Second Session of the 116th Congress
ENHANCING PATENT DIVERSITY FOR AMERICA'S INNOVATORS
On Wednesday, January 15, 2020, the Committee on Small
Business held a hearing titled: ``Enhancing Patent Diversity
for America's Innovators.'' The exceptional economic
performance of the United States has largely been driven by
innovation, entrepreneurship, and competitiveness which has led
to new business formation and improved the lives of all
Americans. However, women, racial minorities, and low-income
individuals are significantly underrepresented in the
innovation ecosystem. The hearing gave academics and small
business innovators the chance to testify on the challenges
that women and minorities often face when trying to obtain a
patent.
Witnesses included Ms. Andrea Ippolito, Program Director of
W.E. Cornell, Cornell University, Ithaca, NY; Dr. Rashawn Ray,
David M. Rubenstein Fellow, The Brookings Institution,
Washington, DC; Ms. Janeya Griffin, Managing Member and
Principal Consultant, The Commercializer, LLC, Lancaster, CA;
and Mr. Rick C. Wade, Vice President, Strategic Alliances and
Outreach, U.S. Chamber of Commerce, Washington, D.C.
The witnesses cited difficulties like lack of access to
capital, a lack of diversity in the tech field, and a shortage
of women and minorities in the STEM field as barriers to
achieving patent equity. The hearing also discussed Chairwoman
Velazquez' bill, H.R. 4075, which would direct the United
States Patent and Trade Office to collect voluntary demographic
data during the patent process that would provide insight into
who is applying for and obtaining patents.
Ms. Ippolito testified that the number of women obtaining
patents has improved, albeit slowly, over the past 40 years.
She stated that the share of patents with at least one female
inventor has increased from five percent in 1976 to 21 percent
in 2016. Mr. Ray testified that it is clear that disparities
extend from who applies to who is ultimately awarded a patent.
He went to testify that collecting demographic data can help
fill these important gaps, create more understanding and equity
in the process, and better streamline resources for trainings
and funding so all Americans can assist the United States in
continuing to be a major world innovator for new products that
can help drive the economy and create jobs. Ms. Griffin
testified that it is crucial that minority inventors
participate in the patenting and commercialization process
because a patent will give minority inventors an incentive to
further innovate.
SBA MANAGEMENT REVIEW: OFFICE OF FIELD OPERATIONS
On Wednesday, January 29, 2020, the Committee on Small
Business held a hearing titled: ``SBA Management Review: Office
of Field Operations.'' The hearing focused on the Small
Business Administration's (SBA) Office of Field Operations'
(OFO) 68 District Offices and ten Regional Field Offices and
how they are the point of delivery for most SBA programs and
services. The hearing also examined how the OFO oversees these
offices and if the organizational structure allows the
Administration to meet the needs of small businesses and
entrepreneurs across the country.
The sole witness for the hearing was: Mr. Michael A.
Vallante, Associate Administrator, Office of Field Operations,
Small Business Administration, Washington D.C.
The witness testified that SBA District Offices are
actively involved in their communities through supporting local
businesses and coordinating with SBA Resource Partners. The
witness stressed the subject matter expertise of the District
Office workers, many of whom have worked for the District
Office for over ten years. The witness also stressed the
difference the District Office employees make in their
communities, their dedication to service, and dedication to
their small business clients.
In addition, the witness testified about the modernizations
happening within SBA District Offices. Modernizations include
improved job descriptions, creating a career ladder to help
retain staff and give them a path to advancement, new
performance metrics, and greater collaboration within SBA. The
witness also testified that the OFO has responded to the
Government Accountability Office's (GAO) and the Office of
Inspector General's (OIG) recommendations by reassessing the
District Office's relationships with Historically Black
Colleges and Universities (HBCUs) in their communities and
instructed the District Offices to hold events and expand
outreach into those communities.
Lastly, the witness testified that the amount of OFO
personnel retracted from the historic average of 800 employees
to 687 because of a 14 percent attrition rate, a 100-day
process to fill vacancies, and a hiring pause. The witness
stated that the department implemented the pause to review the
hiring process and cost of employees. The witness testified
that the hiring pause is no longer in place.
SBA MANAGEMENT REVIEW: OFFICE OF CREDIT RISK MANAGEMENT
On Wednesday, February 5, 2020, the Committee on Small
Business held a hearing titled: ``SBA Management Review: Office
of Credit Risk Management.'' The hearing allowed Committee
Members to learn about SBA's Office of Credit Risk Management
(OCRM), which was codified in the 115th Congress as part of the
Small Business 7(a) Lending Oversight Reform Act of 2018
(Oversight Act). Members learned about the current
administrative challenges facing OCRM and ways to continue
enhancing oversight and credit risk management for SBA's
Capital Access programs.
The sole witness was Ms. Susan Streich, Director for OCRM,
Office of Capital Access, SBA.
Ms. Streich's testimony gave a detailed summary of the role
OCRM plays within SBA's Office of Capital Access as it relates
to monitoring the performance of over 3,500 7(a) and 504
lenders. She also highlighted the impact of the Oversight Act,
which allowed OCRM to rely less on contracted staff, and to
increase staff. Following the Oversight Act, OCRM was able to
implement a rigorous training program to ensure it has the
workforce capability and leadership in-house to support its
heightened mission and responsibilities. In response to
questioning, Ms. Streich also emphasized SBA currently lacks a
mechanism for systematically tracking 7(a) loan agents, which
would enhance transparency within the loan programs.
CHALLENGES AND BENEFITS OF EMPLOYEE-OWNED SMALL BUSINESSES
On Wednesday, February 12, 2020, the Committee on Small
Business held a hearing titled: ``Challenges and Benefits of
Employee-owned Small Businesses.'' The hearing allowed
Committee Members to learn about the benefits of employee
ownership for business owners, their employees, and their local
economies. Members were also exposed to the broad distinctions
that exist between the two most prominent forms of employee
ownership: Employee Stock Ownership Plans (ESOPs) and
cooperatives (co-ops).
Witnesses on the panel were: Mr. Daniel Goldstein, CEO and
President, Folience, Cedar Rapids, IA; Mr. R.L. Condra, Vice
President of Advocacy and Government Programs, National
Cooperative Bank, Arlington, VA; Mr. John Abrams, CEO and Co-
owner, South Mountain Company, West Tisbury, MA; and Mr. Mark
Gillming, Senior Vice President, Messer Construction Company,
Cincinnati, OH.
Mr. Goldstein's testimony focused on Folience's role as a
company that purchases fledgling businesses and converts them
into ESOPs as a business-saving strategy. His testimony
identified three major obstacles to the expansion of employee
ownership in the economy: 1) an absence of clear federal
regulatory guidance, particularly on business valuations for
purposes of securing an ESOP loan; 2) a shortage of lending
capital for ESOP formation or acquisitions; and 3) low public
and professional awareness about ESOPs. Mr. Condra's testimony
focused on current challenges cooperatives face in navigating
the federal programmatic landscape, specifically how the SBA
7(a) program's personal guarantee requirement presents a nearly
insurmountable barrier for cooperatives in accessing 7(a)
loans. According to Mr. Condra's testimony, there has only been
one 7(a) loan to a cooperative in SBA's history.
Mr. Abrams' testimony focused on the many benefits of the
cooperative business structure, saying that ``when employee
owners are making the decisions, it is more likely that
companies will stay rooted in place and be positive forces in
their local community.'' Mr. Gillming's testimony centered on
the benefits of employee ownership from the perspective of a
business that was converted to an ESOP including increased
worker productivity, job satisfaction, and year over year
business growth.
A DISCUSSION WITH SBA ADMINISTRATOR JOVITA CARRANZA: CURRENT ISSUES AND
THE FY2021 BUDGET
On Wednesday, February 26, 2020, the Committee on Small
Business held a hearing titled: ``A Discussion with SBA
Administrator Jovita Carranza: Current Issues and the FY2021
Budget''. The hearing was an opportunity for Members to discuss
the newly appointed Small Business Administration (SBA)
Administrator's vision for the Agency, the President's FY2021
budget request, and the opportunities and challenges that exist
for participants in SBA's programs.
The sole witness for the hearing was: The Honorable Jovita
Carranza, Administrator, U.S. Small Business Administration,
Washington, D.C.
Administrator Carranza testified on her priorities for the
Agency as she begins her role as SBA Administrator. One of her
priorities was to continue to support SBA's Disaster Assistance
program to ensure that SBA officials are available and on-the-
ground during a disaster. The witness emphasized another
priority of continuing to expand SBA's counseling, lending, and
contracting opportunities to women, minority, and veteran-owned
businesses. The witness stressed her commitment to promoting
women-owned businesses particularly as women begin to represent
a greater portion of the workforce and small business owners.
The Administrator testified that, as she continues in her new
position, she will engage with SBA's internal and external
stakeholders to examine staffing and operational needs.
In addition, the witness testified that she reviewed the
President's budget request but would continue to examine the
needs of SBA's programs in-depth. The Administrator stated that
she will continue to review the open recommendations made by
the Government Accountability Office (GAO) and the SBA's Office
of Inspector General (OIG). The witness also pledged to create
a steering committee to proactively address the potential
effects of COVID-19 on small businesses.
BUILDING BLOCKS OF CHANGE: THE BENEFITS OF BLOCKCHAIN TECHNOLOGY FOR
SMALL BUSINESSES
On Wednesday, March 4, 2020, the Committee on Small
Business met for a hearing titled: ``Building Blocks of Change:
The Benefits of Blockchain Technology for Small Businesses.''
The witnesses included: Mr. Shane Bigelow, CEO, Ownum,
LLC., Cleveland, OH who testified on behalf of the Chamber of
Digital Commerce; Ms. Dawn Dickson, Founder and CEO, PopCom,
Columbus, OH; Mr. Marvin Ammori, General Counsel, Protocol
Labs, Wilmington, DE, who testified on behalf of the Blockchain
Association; Mr. Jim Harper, Visiting Fellow, American
Enterprise Institute, Washington, D.C.
The witnesses discussed how blockchain can be used for
things like cryptocurrency, but also has many other uses,
including tracking goods in global supply chains or enabling
peer-to-peer transactions between connected devices. Mr.
Bigelow discussed how blockchain technology is used to digitize
vital records, and how secure digital access to such records
can be beneficial to small businesses. Ms. Dickson discussed
how her small business utilizes blockchain technology, and also
outlined how SBA programs and resource partners have engaged
with this emerging technology. Mr. Ammori provided Committee
Members a basic understanding of the varied applications of
blockchain technology including how it can improve
cybersecurity, payment processing, and record keeping. He
outlined how blockchain technology can help small businesses
complete on a level playing field with larger companies and
also eliminate the need for intermediaries in a number of
business transactions. Mr. Harper discussed how blockchain
technology can help lower costs for small businesses, allow for
diversified and open market structures, and reduce the
competitive advantage that large businesses have with big data.
THE IMPACT OF CORONAVIRUS ON AMERICA'S SMALL BUSINESSES
On Tuesday, March 10, 2020, the Committee on Small Business
met for a hearing titled: ``The Impact of Coronavirus on
America's Small Businesses.'' During the hearing, members heard
from public health experts, small business owners, and
economists about the early toll of the COVID-19 pandemic on
America's small firms and how it would affect them moving
forward as the nation began to shut down.
The panelists were: Dr. Jennifer Huang Bouey, Ph.D., M.D.,
Senior Policy Researcher, Tang Chair in China Policy Studies,
Rand Corporation, Arlington, VA; Mr. Jay Ellenby, President
Safe Harbors Business Travel Group, Bel Air, MD, Testifying on
behalf of the American Society of Travel Advisors (ASTA); Mr.
Andrew Chau, Co-Founder and CEO, Boba Guys-Tea People USA,
Brisbane CA and; Dr. Yanzhong Huang, Ph.D., Senior Fellow for
Global Health, Council on Foreign Relations, Professor, Seton
Hall University's School of Diplomacy and International
Relations, Washington, D.C.
Dr. Bouey testified about the early effects of the COVID-19
pandemic in China, and how the economic shutdown in the country
was likely to hurt small U.S. firms that engage in
international trade. She also clearly emphasized the two
epidemics that arise when a viral outbreak hits: that of fear,
and that of disinformation. Mr. Ellenby testified about the
early effects on the travel industry, which was one of the
earliest casualties from the pandemic. He praised the committee
for its work on the EIDL program and went further to say small
firms needed additional help, especially in the travel industry
which had already began mass layoffs. Mr. Chau described the
early effects of the virus on Asian-American communities here
in the U.S., which had a significant decline in traffic in the
lead up to economic shutdowns across the country. He described
the prejudice and disinformation that was hurting these
companies' ability to stay afloat. Dr. Huang echoed the
sentiments of Dr. Bouey and put a greater emphasis on the
supply chain issues many small companies in the U.S. faced due
to economic shutdowns in China.
MEMBER DAY HEARING ON COVID-19 RESPONSE AND RECOVERY: COMMITTEE ON
SMALL BUSINESS
On Thursday, April 23, 2020, the Committee on Small
Business held a hearing titled: ``Member Day Hearing on COVID-
19 Response and Recovery: Committee on Small Business''. The
hearing gave Members of the House of Representatives, including
non-Committee Members, the opportunity to testify before the
Committee about priorities related to the Paycheck Protection
Program (PPP) and the Economic Injury Disaster Loan (EIDL) as
established under the CARES Act. The hearing was comprised of
six panels.
The witnesses for panel one were: The Honorable Ed Case,
The Honorable Andy Barr, The Honorable Gil Cisneros, The
Honorable Gus Bilirakis, The Honorable Veronica Escobar, The
Honorable Ted Budd, The Honorable Jimmy Gomez, and The
Honorable Mark Amodei.
The witnesses for panel two were: The Honorable Deb
Haaland, The Honorable Bradley Byrne, The Honorable Steven
Horsford, The Honorable Buddy Carter, The Honorable Derek
Kilmer, The Honorable John Curtis, The Honorable Susie Lee, and
The Honorable Michael Burgess.
The witnesses for panel three were: The Honorable Elaine
Luria, The Honorable Morgan Griffith, The Honorable Tom
Malinowski, The Honorable Dusty Johnson, The Honorable Joe
Neguse, The Honorable Mike Johnson, The Honorable Donald
Norcross, and The Honorable Brian Fitzpatrick.
The witnesses for panel four were: The Honorable Dean
Phillips, The Honorable Fred Keller, The Honorable Max Rose,
The Honorable Greg Pence, The Honorable Adam Schiff, The
Honorable Tom Rice, The Honorable Kim Schrier, and The
Honorable John Katko.
The witnesses for panel five were: The Honorable Mikie
Sherrill, The Honorable Chip Roy, The Honorable Elissa Slotkin,
The Honorable Lloyd Smucker, The Honorable Abigail Spanberger,
The Honorable Scott Tipton, The Honorable Haley Stevens, and
The Honorable Phil Roe.
The witnesses for panel six were: The Honorable Mike
Thompson, The Honorable Ann Wagner, The Honorable Steve Womack,
and The Honorable Glenn Thompson.
UPDATE FROM THE SMALL BUSINESS ADMINISTRATION'S RESOURCE PARTNERS ON
THE IMPLEMENTATION OF THE CARES ACT
On Thursday, May 7, 2020, the Committee on Small Business
met for a bipartisan virtual forum titled: ``Update from the
Small Business Administration's Resource Partners on the
Implementation of the CARES Act.'' The virtual forum focused on
the Resource Partner implementation of the CARES Act, what is
working well and what can be improved. The virtual forum
examined the slow disbursement of CARES Act funding, a lack of
clear and consistent guidance from SBA, a lack of communication
from SBA, and the delay in SBA implementing CARES Act language
services requirements.
The panelists for the virtual forum were: Mr. Tee Rowe,
President and CEO, America's SBDC, Burke, VA; Ms. Corinne
Hodges, CEO, Association of Women's Business Centers,
Washington, D.C.; Ms. Bridget Weston, Acting CEO, The Service
Corps of Retired Executives (SCORE), Herndon, VA.; Ms. Amy
Amoroso, Director, Veteran's Business Outreach Center, Region
II NY/NJ/PR/USVI, Watervliet, NY; Ms. Linda Womack, Director,
Minority Business Development Agency, Tacoma-Business Center,
Tacoma Washington.
SBA Resource Partners stated that, since the beginning of
the COVID-19 outbreak, they experienced a dramatic increase in
clients, doing a years' worth of work within a few months.
Resource Partner's stated that their focus was to help their
clients navigate the Federal resources provided through the
CARES Act, create resiliency plans for a long-term loss of
revenue, and pivot to virtual and remote customer service. In
addition, Resource Partners stated that the conflicting
information and guidance from SBA hindered their ability to
provide accurate and timely information to small business
owners and entrepreneurs. Lastly, the Resource Partners stated
that they relied on the languages services that their centers
can provide in-house because SBA had not provided services and
materials in foreign languages.
A CONVERSATION WITH SBA PAYCHECK PROTECTION PROGRAM LENDERS
On Wednesday, May 13, 2020, the Committee on Small Business
held a bipartisan virtual forum titled: ``A Conversation with
SBA Paycheck Protection Program Lenders'' led by Subcommittee
on Economic Growth, Tax, and Capital Access Chairman Andy Kim
(D-NJ) and Ranking Member Kevin Hern (R-OK). During the forum,
Committee Members learned about the issues lenders and
borrowers encountered in the program. Members also discussed
potential improvements with the panelists.
The panelists were: Mr. Tony Wilkinson, President, National
Association of Government Guaranteed Lenders (NAGGL); Ms.
Dafina Williams, Vice President of Public Policy, Opportunity
Finance Network (OFN); Mr. Brett Palmer, President, Small
Business Investor Alliance (SBIA); and Mr. D. Jay Hannah,
Executive Vice President of Financial Services, BancFirst Bank.
Mr. Wilkinson's testimony provided a broad overview of the
issues Paycheck Protection Program (PPP) lenders faced early in
the program, which for lenders, centered on a lack of
programmatic guidance, both for program operations, and
specifically on the forgiveness rule. Mr. Wilkinson also
testified that many borrowers reported the forgiveness terms
were too restrictive, and that they would struggle to achieve
full forgiveness. Ms. Williams testified from the perspective
of Community Development Financial Institutions (CDFIs)
following the $60 billion set-aside for community lenders that
was included in the Paycheck Protection Program and Health Care
Enhancement Act. Mr. Palmer testified regarding the role the
SBA's Small Business Investment Company Program can play in
providing long-term recovery funding, particularly for those
businesses who need different capital solutions than
traditional bank financing or a PPP loan. Mr. Hannah offered
the perspective of a community banker participating in the PPP
and testified regarding the job-saving impact the program was
having on his community.
FIRST LOOK: SBA OFFICE OF INSPECTOR GENERAL PRELIMINARY PAYCHECK
PROTECTION PROGRAM REPORT
On Friday, May 15, 2020, the Committee on Small Business
met to hold a bipartisan virtual forum titled: ``First Look:
SBA Office of Inspector General Preliminary Paycheck Protection
Program Report'' led by Subcommittee on Investigations,
Oversight, and Regulations Chairwoman Judy Chu (D-CA) and
Ranking Member Ross Spano (R-FL). The forum focused on the
Small Business Administration (SBA) Office of Inspector
General's (OIG) plan to conduct audits and reviews of the CARES
Act Paycheck Protection Program (PPP) and Economic Injury
Disaster Loan (EIDL) program. The virtual forum also included a
discussion on the ``Flash Report'' released on May 8, 2020, by
the SBA OIG that outlined where SBA's interim finale rules
(IFR) and FAQs where aligned with the intent of the CARES Act
and were they differed.
The panelist for the virtual forum was: The Honorable
Hannibal ``Mike'' Ware, the Inspector General of the Small
Business Administration.
The panelist stated that the OIG plans to leverage past
oversight work, aimed at reducing fraud, waste, and abuse, and
utilize lessons learned from previous audits to inform the
CARES Act funding recipients and SBA on ways to avoid risk
areas. The panelist also detailed the findings from the May 8,
2020, ``Flash Report'' that stated that SBA did not issue
guidance to prioritize underserved markets or to lenders on the
deferment process. In addition, the OIG stated that SBA
implemented two requirements that did not align with the CARES
Act; the requirements that 75 percent of the PPP loan be used
for payroll and that borrowers repay any amount not eligible
for forgiveness withing two years. The panelist suggested that
SBA could improve upon the findings in the ``Flash Report'' by
issuing appropriate guidance, collecting demographic data on
loans, and evaluate the negative impact of the 75 percent of
PPP usage rule and reevaluate as necessary.
THE EFFECTS OF COVID-19 ON RURAL ECONOMIES
On Wednesday, May 20, 2020, the Committee on Small Business
held a bipartisan virtual forum titled: ``The Effects of COVID-
19 on Rural Economies'' led by Subcommittee on Rural
Development, Agriculture, Trade, and Entrepreneurship
Chairwoman Abby Finkenauer (D-IA) and Ranking Member John Joyce
(R-PA). This forum provided an opportunity for members of
Congress to hear from rural leaders about the impacts of COVID-
19 on rural communities and how Small Business Administration's
(SBA) programs, and other federal programs, are addressing the
issues.
At the virtual forum, members heard from the following
panelists: Mr. Bill Menner, Executive Director of the Iowa
Rural Development Council, Grinnell, Iowa; Ms. Melissa Moretz,
Farmer at Moretz Farm and Commercial Portfolio Manager at First
Citizens Bank, Mason City, Iowa; Ms. Ines Polonius, CEO of
Communities Unlimited, Fayetteville, Arkansas: Mr. Rick Ebert,
President of Pennsylvania Farm Bureau, Blairsville,
Pennsylvania.
The witnesses testified about programs in the CARES Act
that were intended to provide relief for struggling small
businesses impacted by the global COVID-19 pandemic, including
programs at SBA and USDA. Witnesses discussed rural community
vitality, health, and well-being, and pointed out that many
rural communities had challenges prior to the outbreak of
COVID-19 such as capital access, and broadband connectivity
issues which have been exacerbated by COVID-19 and need to be
addressed as part of comprehensive recovery efforts. Witnesses
also discussed many CARES act programs and their importance for
rural communities. However, some witnesses pointed out that
these programs are only helpful if the businesses and
communities have knowledge of the programs and access to
lenders or resource partners. Some witnesses pointed out that
many rural communities are unbanked, and the important role
that CDFIs and other microlenders play in supporting rural
small businesses. Witnesses also discussed the impacts of the
COVID-19 pandemic on agriculture. One witness pointed out that
the loss of markets has impacted farm businesses around the
country, many farmers initially had problems in accessing SBA
CARES act programs. Additionally, many of the witnesses
outlined the importance of 501(c)(6) and other non- profits in
rural communities and discussed the desire for those entities
to be eligible for CARES act supports.
BUSINESS INTERRUPTION COVERAGE: ARE POLICYHOLDERS BEING LEFT BEHIND?
On Thursday, May 21, 2020, the Committee on Small Business
held a bipartisan virtual forum titled: ``Business Interruption
Coverage: Are Policyholders Being Left Behind?'' It was led by
led by Subcommittee on Innovation and Workforce Development
Chairman Jason Crow (D-CO) and Ranking Member Troy Balderson
(R-OH). During the forum, Committee Members learned about the
issues small business insurance policyholders have faced in
making pandemic-related insurance claims. Members also
discussed various proposed solutions.
The panelists were: Mr. Chris Morrow, Owner, Northshire
Bookstore; Mr. Francisco Schlotterbeck, CEO, Maya Cinemas; Mr.
Mark Shaker, Co-Founder, Stanley Marketplace; Mr. John W.
Houghtaling II, Managing Partner, Gauthier Murphy & Houghtaling
LLC; and Sean Kevelighan, President and CEO, Insurance
Information Institute.
As a bookstore owner with stores in two states, Mr. Morrow
testified as to the challenges he faced with two different sets
of insurance rules governing the policies in each state. Mr.
Schlotterbeck testified regarding the unique impact the
pandemic was having on movie theaters and other businesses who
depend on gathering people together. Mr. Shaker's testimony
offered the perspective of a small business owner who also
rents space in his marketplace to other small businesses, and
shared with the Committee some of the ways in which he has been
able to offer his tenants relief. Mr. Houghtaling testified
regarding policyholder's rights under business interruption
insurance policies generally, and especially with regard to
policies that explicitly include coverage for viral pandemics
claims on which have been denied. Mr. Houghtaling also
testified regarding some potential solutions for policyholders.
Mr. Kevelighan testified from the insurance industry's
perspective and argued against relief for policyholders under
many existing contracts.
SMALL BUSINESS PRIORITIES FOR THE NEXT PHASE OF RECOVERY: HOW TO
LEVERAGE THE SMALL BUSINESS DEVELOPMENT CENTER NETWORK
On Thursday, May 28, 2020, the Committee on Small Business
met for a bipartisan virtual forum led by Subcommittee
Contracting and Infrastructure Chairman Jared Golden (D-ME) and
Ranking Member Pete Stauber (R-MN) titled: ``Small Business
Priorities for the Next Phase of Recovery: How to Leverage the
Small Business Development Center Network.'' The virtual forum
provided an opportunity for Members to learn how Small Business
Development Centers (SBDCs) have supported small businesses in
their local communities through the COVID-19 pandemic and
examined the challenges businesses face through phased
reopening. The forum also discussed how H.R. 4406, the Small
Business Development Center Improvement Act of 2019, would
allow SBDCs to reach more small businesses through marketing.
The panelists for the virtual forum were: Mr. Tee Rowe,
President and CEO, America's SBDC, Burke, VA; Mr. Mark Delisle,
State Director, Maine SBDC, Portland, ME; Mr. Joe Musumeci and
Ms. Mary Ellms, Co-Owners, Farmington Underground Escape Room,
Farmington, ME; Mr. Bruce Strong, State Director, Minnesota
SBDC, St. Paul, MN.
The panelists stated that fragmented phased reopening
requirements across the country created confusion among SBDC
counselors, clients, and customers. In addition, seasonal
businesses were negatively impacted by closures as they rely on
the summer months to generate a large portion of their annual
revenue. Panelists stated that this frustration was compounded
when seasonal businesses initially had to calculate Paycheck
Protection Program (PPP) applications with their current number
of staff, not their peak staff level. While this was addressed
through an April 2, 2020 Interim Final Rule (IFR) from the
Small Business Administration (SBA), seasonal businesses have
had to use SBDCs to get creative and pivot their business
models to adapt and survive.
Panelists also discussed the negative impact of SBDCs being
unable to market their services. Panelists stated that more
small businesses and entrepreneurs could use the invaluable
services that SBDC provide but, they may be unaware of their
existence in their communities.Panelists stated that if
Congress were to pass H.R. 4406, the bills marketing provisions would
help small businesses learn about and access the services of SBDCs
across the country.
THE ECONOMIC INJURY DISASTER LOAN PROGRAM: A VIEW FROM MAIN STREET
On Wednesday, June 10, 2020, the Committee on Small
Business held a virtual hearing titled: ``The Economic Injury
Disaster Loan Program: A View from Main Street.'' During the
hearing, Committee Members learned about the SBA's Economic
Injury Disaster Loan (EIDL) program, which was made available
to small businesses, independent contractors, and certain
nonprofits as a way to provide financial assistance for harm
caused by the COVID-19 pandemic issues small business insurance
policyholders have faced in making pandemic-related insurance
claims. Members also discussed various proposed solutions.
The panelists were: Ms. Nancy Sexton, Owner, The Muse
Rooms, North Hollywood, CA; Mr. Jerome Whack, Owner, Christian
Street Pharmacy, Philadelphia, PA; Dr. Craig Gerstein,
Ophthalmologist, Gerstein Eye Institute, Chicago, IL; Ms. Karen
Kerrigan, President and CEO, SBE Council, Vienna, VA.
As the owner of a co-working space for other entrepreneurs,
Ms. Sexton's testimony offered the perspective of a small
business owner who also rents space to other small businesses,
and shared with the Committee some of the unique challenges she
faced and how she tried to offer her tenants relief. She also
testified regarding her expectations that the EIDL would
provide long- term low-interest capital for flexible uses, and
was disappointed to learn that neither her EIDL loan or advance
amounts would meet her needs. Mr. Whack's testimony focused on
how the pandemic had a disproportionate impact on communities
of color, and how his pharmacy struggled through the pandemic
with particularly thin margins but continued to serve the
community. He was hopeful the EIDL Advance would have provided
a quick bridge to longer-term capital, but an unintentional
error kept him from quickly accessing funds. Dr. Gerstein's
testified that he needed a loan of about $800,000 to $1 million
in order for his business to survive the pandemic and felt that
with a maximum loan size of $2 million, the EIDL program was
perfect for his needs. He testified regarding his
disappointment at the SBA-imposed $150,000 cap on loan sizes,
and how he was then forced to seek more expensive capital
elsewhere. Ms. Kerrigan's testimony summarized numerous issues
with borrower's experience in the EIDL program, and offered
numerous recommendations for improving the EIDL program, which
included increasing transparency with stakeholders about
changes and why they are being made.
PAYCHECK PROTECTION PROGRAM: LOAN FORGIVENESS AND OTHER CHALLENGES
On Wednesday, June 17, 2020, the Committee on Small
Business held a virtual hearing titled: ``Paycheck Protection
Program: Loan Forgiveness and Other Challenges.'' During the
hearing, Committee Members learned about the SBA's Paycheck
Protection Program (PPP) and the issues borrowers and lenders
faced in applying for and using the loans, especially regarding
the eligible use of proceeds that qualify borrowers for full
loan forgiveness. Members also heard about the positive
experiences and impact of the program, feedback regarding
recently enacted changes to the program, and recommendations to
continue optimizing the program.
The panelists were: Ms. Melissa Kelly, Executive Chef and
Proprietor, Primo, Rockland, ME; Mr. Eduardo Sosa, Senior Vice
President, SBA Lending, Commerce National Bank, West Lake
Hills, TX; Ms. Ashley Harrington, Director of Federal Advocacy
and Senior Counsel, Center for Responsible Lending, Washington,
DC; and Dr. Rich Coleman, DVM, Owner, Four Paws Animal
Hospital, Lebanon, OH.
Ms. Kelly testified that the restricted use of PPP loan
funds limited the business-saving value of the loan to her
business, which needed relief beyond payroll support, though
she did retain multiple employees. Mr. Sosa's testimony offered
the perspective of a seasoned 7(a) lender with deep knowledge
and experience with the 7(a) loan program. He reported
frustrations with the PPP, particularly the lack of
programmatic guidance for lenders and forgiveness guidance for
borrowers. Ms. Harrington's testimony focused on the
disproportionate impact the COVID-19 pandemic was having on
businesses of color and urged Congress to strengthen community
lender set asides. Both Mr. Sosa and Ms. Harrington urged
Congress to provide automatic loan forgiveness for all PPP
loans of at least $125,000. Dr. Coleman's testimony provided a
generally positive review of the program, as the loan helped
him save 34 jobs at his animal hospital, and reported his only
concern with the loan process was that the documents he signed
did not have any language discussing loan forgiveness terms,
and felt he was signing the loan in good faith that the
government would honor forgiveness.
THE ECONOMIC INJURY DISASTER LOAN PROGRAM: STATUS UPDATE FROM THE
ADMINISTRATION
On Wednesday, July 1, 2020, the Committee on Small Business
held a hybrid hearing titled: ``The Economic Injury Disaster
Loan Program: Status Update from the Administration.'' During
the hearing, Committee Members heard about the SBA's
implementation of the Economic Injury Disaster Loan (EIDL)
program during the Coronavirus pandemic (COVID-19). Members
also asked Mr. James Rivera, the Associate Administrator for
ODA, about his plan to strengthen the program in the coming
months, and what programmatic changes were needed from Congress
in order to improve the program's operations and reach.
The sole witness was Mr. James Rivera, Associate
Administrator for the SBA's Office of Disaster Assistance.
Mr. Rivera testified that the SBA's decisions to cap EIDL
loan sizes at $150,000, and to limit EIDL Advances to $1,000
per employee, were out of a desire to ensure limited program
funds could reach all borrowers. He also testified regarding
the numerous challenges the agency faced ramping up the program
in response to COVID-19, which saw more disaster lending than
for any other disaster in the agency's history, combined. At
the time of the hearing, Mr. Rivera reported that ODA staff
totaled over 7,000 personnel, which was an all-time high for
SBA's disaster response efforts. He also addressed concerns
over SBA's lack of communication with borrowers and
stakeholders.
LONG-LASTING SOLUTIONS FOR A SMALL BUSINESS RECOVERY
On Wednesday, July 15, 2020, the Committee on Small
Business met for a virtual hearing titled: ``Long-Lasting
Solutions for a Small Business Recovery.'' The hearing focused
on current barriers and solutions to recovery for small
businesses. It explored efforts to stimulate small business
growth following the Great Recession, applying those programs
to the Coronavirus Pandemic (COVID-19), and new ideas to help
industries that have been disproportionally impacted by COVID-
19.
The witnesses for the hearing were: Mr. Brett Palmer,
President of the Small Business Investor Alliance; Ms. Amanda
Cohen, Chef and Owner of Dirt Candy; Dr. Lisa D. Cook,
Professor at Michigan State University; and Mr. Pete Blackshaw,
CEO of Cintrifuse.
The witnesses testified how small businesses and the
economy as a whole were doing before and during the pandemic.
All of the witnesses discussed how SBA and government programs,
such as Economic Injury Disaster Loan Program (EIDL) and
Paycheck Protection Program (PPP) have helped their businesses
during the COVID-19 pandemic. The witnesses provided
recommendations on how SBA and the Federal government could
further improve programs to assist small businesses during and
after the COVID-19 pandemic. For example, Mr. Palmer suggested
improving the SBIC program to help challenges with accessing
capital--especially equity and growth capital--and improving
access to short-term lines of credit. While Dr. Cook focused on
how to target the PPP and EIDL programs to further assist women
and minority-owned businesses.
Additionally, the witnesses emphasized how the current SBA
programs have not fully addressed problems in rural communities
and with women-owned, minority-owned, and microbusinesses. Two
of the witnesses Dr. Cook and Ms. Cohen advocated that moving
forward, there needs to be more access to grants, rather than
loans, to target the most underrepresented groups. Ms. Cohen
also advocated for the RESTAURANTS Act, which would build on
the successes of the PPP and Emergency EIDL grants by creating
a new $120 billion dollar grant program to provide additional
support for restaurants that have been hit the hardest by the
COVID-19 pandemic. Finally, Mr. Palmer testified regarding how
a new ``Micro-SBIC'' license would help remove unintentional
barriers to entry to the private equity space by minority
investors.
OVERSIGHT OF THE SMALL BUSINESS ADMINISTRATION AND DEPARTMENT OF
TREASURY PANDEMIC PROGRAMS
On Friday, July 17, 2020, the Committee on Small Business
held a hybrid hearing titled: ``Oversight of the Small Business
Administration and Department of Treasury Pandemic Programs.''
During the hearing, Committee Members heard directly from the
two agency heads responsible for the implementation of several
legislative provisions designed to assist small businesses
during the Coronavirus pandemic (COVID-19), including the
Paycheck Protection Program (PPP) established under the CARES
Act, as well as SBA's long-standing EIDL program. Members also
asked the panelists about further policy changes to ensure the
programs are reaching underserved small businesses.
The witnesses were the Honorable Steven Mnuchin, U.S.
Secretary of the Treasury and the Honorable Jovita Carranza,
Administrator of the Small Business Administration (SBA).
Secretary Mnuchin testified in support of setting aside PPP
dollars for minority-owned businesses, though he did not commit
to a specific amount. Mr. Mnuchin's testimony also provided an
update regarding PPP data and the agencies' cooperation with
the Government Accountability Office (GAO). He further
testified about other Treasury pandemic programs, such as the
Economic Impact Payments and Federal Reserve facilities.
Administrator Carranza testified that SBA's Office of Capital
Access approved over 3,600 new lenders who have never before
participated in SBA lending, and that over 5,300 lenders were
in the smallest lender category. She also testified these
lenders reported making the highest number of loans. She
further testified that though SBA continues to process and
approve EIDL loans, the agency exhausted the $20 billion
provided for EIDL Advances. Members also pressed the
Administrator to lift the $150,000 cap on the EIDL, stating the
decision shortchanged millions of small businesses.
TRANSPARENCY IN SMALL BUSINESS LENDING
On Wednesday, September 9, 2020, the Committee on Small
Business held a hearing titled: ``Transparency in Small
Business Lending.'' During the hearing, Committee Members
learned about the importance of transparency in the terms and
pricing of small business loans, especially in a credit market
filled with predatory lenders. Members heard from a large
Community Development Financial Institution (CDFI) that
recently partnered with two financial technology (Fintech)
companies to expand access to affordable capital to underserved
borrowers. Members also heard from a second CDFI lender and
fair lending advocate about state-level efforts to improve
transparency in small business lending, and more broadly about
the risks presented to small business owners by some Fintech
products. Members also asked the legal expert on the panel how
the current patchwork of state and federal law cannot properly
oversee and regulate the small business credit market, and
recommendations for improving transparency and fairness in
small business lending without hurting the affordability of
credit.
The witnesses were: Ms. Luz Urrutia, CEO, Opportunity Fund,
San Jose, CA; Ms. Yanki Tshering, Executive Director, Business
Center for New Americans, New York, NY; Mr. Adam Levitin,
Professor of Law, Georgetown University Law Center, Washington,
DC; and Mr. Michael Hiles, Founder and CEO, 10XTS, Cincinnati,
OH.
Ms. Urrutia testified regarding the ways Fintech advances
can be deployed responsibly to improve access to affordable
capital for small businesses. Specifically, she testified that
her CDFI's recent partnership with two large Fintech companies
allows her CDFI to expand its geographic reach across the
country. Ms. Tshering testified regarding the impact unfair
lending practices and terms can have on minority and immigrant
small business owners, and as a CDFI lender has refinanced many
predatory loans into more affordable products. She, along with
Ms. Urrutia and Mr. Levitin, broadly agreed that Representative
Velazquez's bill, H.R. 7889 which was introduced on July 30,
2020 and would apply the Truth in Lending Act to small business
loans, is a step in the right direction to protect small
businesses and enhance the role of the Consumer Financial
Protection Bureau in policing the small business credit market.
Mr. Levitin testified regarding the legal framework that
enables predatory small business lenders to operate relatively
unchecked--a loose and inconsistent patchwork of state and
federal laws that fail to properly oversee and consistently
regulate market participants. Mr. Hiles testified regarding the
opportunities Fintech advances presents for improving
operations and efficiency at SBA and the federal government
overall. He also testified on the shifting expectations of
younger consumers with respect to technology, how it is
changing the nature of banking, and how this will impact the
future of small business borrowing.
TAKING CARE OF BUSINESS: HOW CHILDCARE IS IMPORTANT FOR REGIONAL
ECONOMIES
On Wednesday, September 30, 2020, the Committee on Small
Business held a hybrid hearing titled: ``How COVID-19 is
Impacting Small Businesses Across the Food System.'' This
hearing gave members a chance to hear about the role of small
businesses within our food production, distribution, and retail
systems, the challenges they are facing, and how federal
programs are addressing these challenges.
Witnesses included: Ms. Kimberly Gorton, President and CEO,
Slade Gorton & Co., Inc., Boston, MA; Mr. Jimmy Wright,
President, Wright's Market, Opelika, AL; Mr. Rob Larew,
President, National Farmers Union, Washington, DC; Mr. Collin
Castore, Owner, Seventh Son Brewing, President, Ohio Craft
Brewers Association (OCBA), Columbus, OH.
Witnesses discussed the various ways that COVID-19 has
exposed numerous vulnerabilities across our food system, and
the impacts on farmers, ranchers, fisheries, and retailers. Ms.
Gorton discussed how the fisheries and seafood industry are
dealing with a 70% decline and billions in lost sales, and also
with the job losses due to COVID-19. She outlined how the small
businesses in the middle of the food supply chain are critical
links in distribution, are hurting due to significantly
decreased demand, and also provide essential financing/credit
via accounts receivable to restaurant customers. Mr. Wright
discussed issues facing small retailers, as the struggled to
compete with larger retailers for in-demand products. He
discussed both supply chain shortages and changing technologies
that have been impacting food retail. He also discussed the
importance of federal nutrition programs like SNAP, that help
address food insecurity around the nation.
Mr. Larew outlined the numerous challenges facing American
farmers and ranchers due to the pandemic. He discussed supply
chain distributions, consolidation across the food and
agricultural sectors, and the impact of COVID-19 outbreaks at
processing plants. He also discussed how food and farm workers
are on the front lines of the pandemic, and the challenges they
face. Mr. Castore discussed the economic impact of COVID-19
restrictions on his small business, and the loss of revenue
with reduction of on-premises alcohol consumption.
PART B
Subcommittee Hearings
First Session of the 116th Congress
EXPLORING CHALLENGES AND OPPORTUNITIES OF UNDERSERVED BUSINESSES IN THE
21ST CENTURY
On Thursday, February 7, 2019, the Subcommittee on Economic
Growth, Tax, and Capital Access held a hearing titled:
``Exploring Challenges and Opportunities of Underserved
Businesses in the 21st Century.'' The hearing allowed Members
to explore the challenges faced by women-owned, minority-owned,
veteran-owned businesses, and rural businesses; how those
businesses have overcome those challenges; and how Congress can
enhance opportunities for growth within each of those
entrepreneurial communities.
Witnesses on the panel were: Ms. Sharon Pinder, President &
CEO, Capital Region Minority Supplier Development Council; Ms.
Marla Bilonick, Executive Director, Latino Economic Development
Center; Mr. Davy Leghorn, Assistant Director, American Legion
Veterans Employment & Education Division; and Mr. Michael
Romano, Senior Vice President, Industry Affairs & Business
Development, NTCA--The Rural Broadband Association.
In her testimony, Ms. Pinder questioned why the SBA hasn't
licensed more minority-led small business investment companies
(SBICs), and argued that diverse businesses play a critical
role in closing the racial wealth gap. Ms. Bilonick testified
that though underserved businesses tend to face many
challenges, the most significant are a lack of access to
capital, lack of access to information and educational
resources, poor or no credit history, and systemic and
institutional racism and sexism. In his testimony, Mr. Leghorn
argued that the Department of Veterans' Affairs Veterans First
Contracting Program should be legislatively extended to the
Department of Defense and Department of Homeland Security. He
also testified that to prevent lapses in federal appropriations
from inhibiting the ability of lenders in the SBA's loan
programs to make loans, SBA's loan processing staff should be
designated ``essential workers.'' Mr. Romano testified on the
challenges many rural-based businesses face in accessing
affordable and reliable broadband Internet. He also testified
that the primary challenge of rural network development is
``making a business case for constructing networks across
hundreds or thousands of miles where the population is sparse,
the terrain is diverse, and the permitting and contractual
considerations can be substantial.''
SHUTDOWN LESSONS: SBA CAPITAL ACCESS PROGRAMS
On Tuesday, February 26, 2019, the Subcommittee on
Investigations, Oversight, and Regulations held a hearing
titled: ``Shutdown Lessons: SBA Capital Access Programs.'' The
hearing allowed Members to explore the challenges faced by the
Small Business Administration's (SBA) Office of Capital Access
during the recent 35-day partial government shutdown, as well
as any lessons learned from conducting its business during a
lapse in appropriations.
The sole witness was Mr. William Manger, Associate
Administrator, Office of Capital Access, SBA.
Mr. Manger testified that during the government shutdown of
2018-19, SBA was unable to approve loans, nor was able to
accept new loan applications. SBA was also unable to process
applications for SBA-guaranteed surety bonds. All new secondary
market 7(a) loan pools were stopped and purchasing of SBA-
guaranteed loans was also halted. He also testified that though
most routine activity in the Office of Capital Access ceased to
operate, a few excepted and exempt operations were functional
during the lapse, including the administrative closing of
certain pre-approved and obligated 504 loans, continued
applications and servicing actions on disaster loans, and the
Lender Match platform.
SMALL BUT MIGHTY: A REVIEW OF THE SBA MICROLOAN PROGRAM
On Thursday, March 7, 2019, the Subcommittee on Economic
Growth, Tax, and Capital Access held a hearing titled ``Small
but Mighty: A Review of the SBA Microloan Program.'' The
hearing allowed Members to learn about the program and its
functions, explore opportunities to continue strengthening the
program, and listen to some of its success stories.
Witnesses on the panel were: Ms. Ceyl Prinster, President &
CEO, Colorado Enterprise Fund, Denver, CO; Ms. Carolina
Martinez, CEO, California Association for Micro Enterprise
Opportunity, San Francisco, CA; Ms. Mariama Jallow, Owner,
Mariama's Beauty Supply, Portland, ME; and Ms. Michelle
Richards, Executive Director, Great Lakes Women's Business
Council, Livonia, MI (testified on behalf of Women Impacting
Public Policy).
Ms. Prinster testified in favor of two changes to the
Microloan program she believes would reduce administrative
burdens on both Intermediaries and the SBA, and facilitate
improved processes to support small businesses seeking credit.
The first is the elimination of the ``one-fifty-fifth rule,''
which places an annual limitation on the distribution of loan
funds for the first half of the year to the lesser of $800,000
or one-fifty-fifth of the new funds appropriated. The second is
the elimination of the ``50-50 rule,'' which governs the amount
of technical assistance grant funds an Intermediary may use on
pre-loan vs. borrower support. Ms. Martinez also testified in
favor of eliminating the 50-50 rule, as well as amending the
one-fifty-fifth rule and for creating a reserve fund at SBA so
that SBA can deploy capital throughout the year in the event of
a lapse in appropriations. She also testified that SBA should
make Microloan data publicly available on its website, similar
to the data publicly available for the 7(a) program. Ms. Jallow
testified regarding her positive experience as a borrower in
the program, and particularly with regard to the importance of
the technical assistance component of the program. Ms.
Richards' testimony echoed the others in arguing for changes to
the one-fifty-fifth and 50-50 rules that would provide greater
flexibility to Intermediaries. She also advocated for increased
public access to Microloan data.
CHALLENGES IN SBA'S STATE TRADE EXPANSION PROGRAM
On Tuesday, March 12, 2019, the Subcommittee on Rural
Development, Agriculture, Trade, and Entrepreneurship held a
hearing titled: ``Challenges in SBA's State Trade Expansion
Program.'' The hearing reviewed the state of the SBA State
Trade Expansion Program (STEP), which was created by The Trade
Facilitation and Trade Enforcement Act of 2015 (TFTEA). The
program provides grants to states to increase the number of
small businesses exploring trade opportunities.
The witnesses for the hearing were: Ms. Kimberly
Gianopoulos, Director, International Affairs and Trade,
Government Accountability Office (GAO); and Mr. Hannibal
``Mike'' Ware, Inspector General of the Small Business
Administration.
Ms. Gianopoulos' testimony was based on a GAO report, which
examined the extent to which SBA's management process provides
reasonable assurance of compliance with the TFTEA and whether
SBA has taken steps to address the challenges states report in
using grant funds. Ms. Gianopoulos testified that SBA's
management process does not provide reasonable assurance that
STEP grant recipients met two of the three TFTEA requirements,
which are: proportional distribution requirement, total match
requirement, and cash match requirement. While SBA's process
provides reasonable assurance of compliance with the
proportional distribution requirement, some states report
challenges with using the grant funds and SBA has not
adequately assessed the risk to the program from low grant use.
Ms. Gianopoulos also testified that some states cited
additional challenges, which include the timing of the
application and award processes, administrative burdens, and
communication with SBA.
Mr. Ware testified that the performance measurements could
be improved, and recipients could have been held more
accountable for meeting the reporting requirements. Mr. Ware
discussed the nine recommendations the OIG made to improve
accountability and performance of STEP, which include (1) meet
with Congress to determine STEP expectations for FY 2012; (2)
ensure that STEP grant recipients' FY 2012 performance measures
align with Congress' expectations; (3) require STEP grant
recipients to establish and provide SBA with quarterly
milestones that will measure effectiveness and efficiency on a
quarterly basis; (4) in cases where STEP grant recipients do
not meet established milestones, require grant recipients to
provide SBA with revised work plans and budget estimates to
meet proposed performance goals; (5) hold STEP grant recipients
accountable for adhering to reporting requirements established
in the notices of award and the FY 2012 STEP grant program
announcement; (6) document and maintain all analyses,
evaluations, and rationale used to award STEP grants; (7)
provide Grant Officer's Technical Representative (GOTR)
training to OIT personnel acting in that capacity; (8)
establish and implement a policy requiring GOTRs to conduct in-
depth reviews of STEP grant recipients' quarterly submissions
and provide feedback to grant recipients; and (9) consult with
OGM to modify STEP grant terms and conditions to align with
SBA's management of the program.
CLEARED FOR TAKE-OFF? IMPLEMENTATION OF THE SMALL BUSINESS RUNWAY
EXTENSION ACT
On Tuesday, March 26, 2019, the Subcommittee on Contracting
and Infrastructure held a hearing titled: ``Cleared for Take-
off? Implementation of the Small Business Runway Extension
Act.'' The hearing examined the Small Business Runway Extension
Act of 2018 and the reasons presented by the Small Business
Administration to delay its implementation. Furthermore, the
hearing explored potential solutions to clarify the statute's
intent and mitigate any implementation challenges.
The witnesses for the hearing were: Mr. David Black,
Partner, Holland & Knight, Tysons, VA; Ms. Megan C. Connor,
Partner, PilieroMazza PLLC, Washington, DC; Mr. Brian Morales,
President, ProCal Lighting, Vista, CA, who testified on behalf
of the National Electrical Contractors Association and; Ms.
Erin Allen, President, Contemporaries, Inc., Silver Spring, MD,
who testified on behalf of the Montgomery County Chamber of
Commerce.
Mr. Black explained the unnecessary confusion that the SBA
created in the small business procurement community by claiming
that the Runway Extension Act was not immediately effective
upon enactment and that it was not applicable to SBA. He stated
why those arguments were legally incorrect and recommended to
address the issue with clarifying amendments that would shed
light onto congressional intent. Moreover, he stressed that
Congress had done a great thing by passing the Runway Extension
Act and that delaying its implementation through any other
legislative action would be taking away a benefit that had
already been provided to the community.
Ms. Connor advocated for a transition period to ensure that
those small firms that might be negatively impacted by Runway
Extension Act are able to adequately adjust. Furthermore, she
stressed that the System for Award Management--commonly known
as SAM--must be modified to appropriately reflect the change in
the receipts-based formula directed by the Runway Extension
Act. Finally, Mr. Morales and Ms. Connor, both business owners,
provided their perspective as to the benefits that the Runway
Extension Act brings to small business companies that are
steadily growing. They welcomed any additional measures taken
by the Committee to provide further guidance, reduce confusion
and ensure that the law is promptly implemented.
THE SMALL BUSINESS TRADE SNAPSHOT: AGRICULTURE AND WORKERS
On Tuesday, April 2, 2019 the Subcommittee on Rural
Development, Agriculture, Trade, and Entrepreneurship met for a
hearing titled, ``The Small Business Trade Snapshot:
Agriculture and Workers.'' With trade at the issues at the
forefront of national conversations, small businesses which
include farmers, make up ninety-seven percent of U.S.
exporters.
Witnesses included, Mr. Mark Meirick, Board Member, Iowa
Pork Producers Association Protivin, IA, testifying on behalf
of the National Pork Producers Council; Ms. Rebecca Dostal,
Iowa Farm Bureau, Traer, IA, testifying on behalf of the Iowa
Farm Bureau Federation; Mr. Josh Nassar, Legislative Director,
International Union, United Automobile, Aerospace, and
Agricultural Implement Workers of America, UAW, Washington,
D.C.; and Mr. Glenn Stoltzfus, Co-owner, Pennwood Farms,
District 11 State Board Director and Dairy Committee Chairman,
Pennsylvania Farm Bureau, Berlin, PA.
Mr. Meirick testified that the tariffs imposed by the
Administration are currently disrupting the pork producing
industry. He stated there never is a good time to have an
export disruption, but the timing now is particularly bad. He
went onto explain that the current trade wars are hurting pork
producers because of retaliatory tariffs. Ms. Dostal testified
about the importance of farming and exporting to the
sustainability of rural economies, particularly Iowa. She
stressed that trade deals like TPP, USMCA, a trade agreement
with the EU that includes agriculture, and a trade deal with
China that is fair and predictable, would expand our markets,
help American farmers, and sustain our rural communities. Mr.
Nassar testified that lawmakers must re-think trade policies
with a focus on the ensuring American workers are protected. He
testified that any effort to reset America's trade policy must
also be accompanied by a strong industrial policy focused on
education, workforce training, research and development,
support for advanced manufacturing and technologies, building a
21st century infrastructure, balancing environmental and energy
policy, and creating penalties for companies that turn their
back on American workers.
SBA 7(A) BUDGET PROPOSAL AND THE IMPACT OF FEE STRUCTURE CHANGES
On Wednesday, April 10, 2019, the Subcommittee on Economic
Growth, Tax, and Capital Access held a hearing titled: ``SBA
7(a) Budget Proposal and the Impact of Fee Structure Changes.''
The hearing allowed Members to learn about the 7(a) Loan
Guaranty Program and how it functions as one that usually
operates at zero cost to the taxpayer. Further, the hearing
examined the Small Business Administration's (SBA) budget
proposal for Fiscal Year 2020 (FY2020), the proposal contained
therein to adjust the fee structures in the program, and the
impact the proposed changes could have on the sustainability of
the 7(a) program.
There were two witness panels. Mr. Tim Gribben, Chief
Financial Officer and Associate Administrator for Performance
Management at SBA testified as the sole witness on the first
panel. Panelists on the second panel were: Mr. Tony Wilkinson,
President & CEO, National Association of Government Guaranteed
Lenders, Stillwater, OK; Ms. Lynn G. Ozer, President-SBA
Lending, Fulton Bank, Pottstown, PA; Ms. Gail Jansen, Vice
President-Business Services & Operations, Kinecta Federal
Credit Union, Manhattan Beach, CA (testified on behalf of the
National Association of Federally-Insured Credit Unions); and
Mr. Gordon Gray, Director of Fiscal Policy, American Action
Forum, Washington, D.C.
On the first witness panel, Mr. Gribben testified regarding
SBA's projection that in FY2020, the 7(a) program will operate
at a positive subsidy, meaning SBA will need either a subsidy
appropriation from Congress, or an adjustment to the fee rates.
On the second witness panel, Mr. Wilkinson testified urging
the Committee to question the subsidy projection made by SBA
and OMB. Ms. Ozer testified that for the 7(a) portfolio to have
gone from a zero subsidy cost to a positive subsidy cost of $99
million, there would be some indication in a worsening of the
portfolio's performance, but in her view there was not. She
also observed that the FY2020 budget revealed that every cohort
of loans made for the past nine fiscal years showed significant
downward re-estimates, meaning that in those years when SBA
asked for a certain level of fees from borrowers and lenders,
SBA could have asked for much less and still have covered the
cost of the program at zero subsidy, that accordingly SBA has
been repeatedly overcharging borrowers and lenders, and that
therefore, the current subsidy model used to project the cost
of the program is not working as it should. Ms. Jansen noted
SBA's proposed fee structure adjustment did not propose changes
for loans of $150,000 or less, which Ms. Jansen testified was
positive. However, she testified that the proposed increases to
fees for loans of $500,001 to $1,500,000 would make it more
expensive for members of her credit union to access credit at
that amount. Mr. Gray testified regarding federal credit
reform, and on how OMB and the various agencies that extend
federal credit calculate projected subsidy costs for each
fiscal year.
LOST OPPORTUNITIES? SBA'S ENGAGEMENT WITH HISTORICALLY BLACK COLLEGES
AND UNIVERSITIES
On Tuesday, April 30, 2019, the Subcommittee on
Investigations, Oversight, and Regulations met in room 2360 of
the Rayburn House Office for a hearing titled: ``Lost
Opportunities? SBA's Engagement with Historically Black
Colleges and Universities.'' The hearing examined whether
Historically Black Colleges and Universities (HBCUs) are
receiving adequate support from the Small Business
Administration (SBA) to help develop successful entrepreneurs.
There were two panels. The first panel was comprised of two
government witnesses, they were: Ms. Anna Maria Ortiz, Acting
Director, Financial Markets and Community Investment,
Government Accountability Office; and Mr. Allen Gutierrez,
Association Administrator, Office of Entrepreneurial
Development, Small Business Administration. The second panel
was comprised of four representatives from Historically Black
Colleges and Universities, they were: Dr. Paulette Dillard,
President, Shaw University; Dr. Barron H. Harvey, Dean of the
School of Business, Howard University; Dr. Michael H. Casson,
Jr., Dean of the School of Business, Delaware State University;
and Dr. Roslyn Clark Artis, President and CEO, Benedict
College.
Ms. Ortiz testified that SBA programs and activities that
foster entrepreneurship have included, but do not specifically
target Historically Black Colleges and Universities (HBCUs).
Preliminary observations indicate that SBA has limited data on
entrepreneurship related efforts at HBCUs, and the
relationships between selected HBCUs, SBA resource partners,
and district offices varied. Mr. Gutierrez testified that in
the past the HBCU initiative has resided in various SBA
offices, and in 2018 the Administrator directed Mr. Gutierrez
to lead this effort. Moving forward, the goals will be to break
down any existing silos within the HBCU engagements, foster
greater coordination with the Office of Field Operations, and
ensure consistency and data collection.
On the second panel, Dr. Dillard testified about Shaw's
experiences and relationship with the SBA. Shaw signed a
Strategic Alliance Memorandum with SBA in January 2013, with
the purpose of developing and fostering a working relationship
to strengthen small business development in the local area. As
part of this partnership, Shaw opened a Small Business Resource
Center in the fall of 2013. The Center hosts seminars and
workshops on a variety of small business topics, including
business planning, credit building, and marketing to students,
alumni, and community residents. Dr. Shaw testified that she
hopes to see greater collaboration between SBA and HBCUs, and
legislation enacted to strengthen Executive Order 13779.
Dr. Harvey testified that entrepreneurship for minorities
has made progress over the last six years but more needs to be
done. The main challenge for African American owned small
businesses is securing capital. More than one-third of minority
owned firms with gross revenues under $500,000 do not apply for
a loan out of fear of rejection. Howard University hosts a lead
SBDC center on campus, and Dr. Harvey discussed how HBCUs can
provide opportunities for the Small Business Administration
through its SBDCs to educate the next generation of
entrepreneurs in the minority and African-American communities.
He recommended that SBA implement a unique and special
partnership with HBCUs, including expanding the number of SBDC
subcenters at HBCUs from 16 to more than 50, strategically
located in communities and areas of great need for economic
impact.
Dr. Casson testified that the impact of the SBA's funding
and services could be exponentially more significant if the
University and the SBA strategically worked together to develop
targeted programming that effectively integrates the talent and
resources of both entities. Dr. Artis testified about
Benedict's experiences with the SBA, and its Strategic Alliance
Memorandum with SBA. Similar to Dr. Dillard's testimony, Dr.
Artis testified that she hopes to see greater collaboration
between SBA and HBCUs, and legislation enacted to strengthen
Executive Order 13779.
THE DIGITAL ECOSYSTEM: NEW PATHS TO ENTREPRENEURSHIP
On Thursday, May 9, 2019, the Subcommittee on Innovation
and Workforce Development held a hearing titled: ``The Digital
Ecosystem: New Paths to Entrepreneurship.'' The hearing
provided the Committee the opportunity to discuss how digital
platforms empower small businesses and potential barriers to
the adoption.
Witnesses included Ms. Kellyn Blossom, Head of Public
Policy, Thumbtack, San Francisco, CA; Ms. Erika Mozes, Co-
Founder and COO, Hyr, Inc., New York, NY; and Mrs. Olivia Omega
Wallace, Co-Founder, Wallace Marketing Group, Aurora, CO.
The Panel discussed how the integration of digital
platforms is vital for small businesses. Mr. Blossom discussed
how small businesses can benefit from tools like Thumbtack to
reach larger audiences and use platform-developed data to track
engagement. Ms. Mozes spoke about how hiring gig workers can
help small business meet labor needs without overspending on
overheard. Ms. Wallace explained why using digital marketing
tools is essential for small business growth and shared ways
that small businesses can adopt these tools at little to no
cost.
OVERSIGHT OF THE SBA'S WOMEN-OWNED SMALL BUSINESS FEDERAL CONTRACT
PROGRAM
On Thursday, May 16, 2019, the Subcommittee on Contracting
and Infrastructure held a hearing titled: ``Oversight of the
SBA's Women-Owned Small Business Federal Contract Program.''
The hearing focused on the extent to which SBA had implemented
the amendments enacted in the Carl Levin and Howard P. ``Buck''
McKeon National Defense Authorization Act for Fiscal Year 2015
(the 2015 NDAA) to the Women-Owned Small Business Program (WOSB
Program). Additionally, it focused on the extent to which SBA
had addressed the deficiencies found in the 2014 GAO report and
reiterated in the 2019 GAO report.
The witnesses for this hearing were: Mr. William B. Shear,
Director, Financial Markets and Community Investment, U.S.
Government Accountability Office, Washington D.C. and; Mr. Robb
N. Wong, Associate Administrator, Office of Government
Contracting and Business Development, U.S. Small Business
Administration, Washington D.C.
Mr. Shear explained that out of the three changes
promulgated in the 2015 NDAA, SBA had implemented just one: the
sole-source authority. SBA had not eliminated the option for
program participants to self-certify and had not implemented
the certification program. Moreover, he explained that SBA had
not addressed program oversight deficiencies highlighted in
GAO's 2014 report. In particular, SBA had not established
procedures to assess the performance of third party certifiers
and had not taken steps to enhance eligibility examinations of
program participants. Thus, GAO maintains that the
implementation of sole-source authority in light of these
continuous oversight deficiencies can increase risks of fraud
and abuse. Furthermore, he testified that it was still a
mystery to him and his team what were the challenges that
contributed to the delay in the implementation of the 2015 NDAA
changes. In multiple occasions, GAO received mixed information
as to where the agency was in the process of creating the
proposed rule for the certification program and SBA could not
even provide project plans or timelines to provide much needed
clarity. Mr. Shear added that, now that the proposed rule had
been finally issued and in looking at its content, he was still
at a lost as to why this proposed rule took so long.
Mr. Wong explained that when he started about two years ago
as Associate Administrator of the Office of Government
Contracting, he quickly learned that nothing had been done with
regards to the WOSB certification program. However, he stressed
that during his tenure, the agency has been developing a
blueprint that would offer clarity as to SBA's present state
and would guide future efforts. This blueprint emphasized
unifying common elements of eligibility and standardizing their
processes and analysis while reducing any variations, in order
to process applications across the different contracting
programs. He expressed that this blueprint will also serve as a
plan of action for funding and staffing needs and that it would
have been irresponsible to make any such requests without
having this blueprint in place. According to Mr. Wong, the main
part of this blueprint has been recently completed and with it
the agency can start to address the concerns raised by GAO and
the 2015 changes. Moreover, he expressed that SBA's estimated
date for initial implementation of the WOSB certification
program is June 2021.
INVESTING IN COMMUNITY: THE SBA'S COMMUNITY ADVANTAGE LOAN PROGRAM
On Tuesday, May 21, 2019, the Subcommittee on
Investigations, Oversight, and Regulations held a hearing
titled: ``Investing in Community: The SBA's Community Advantage
Loan Program.'' The hearing allowed Members to learn about
SBA's Community Advantage (CA) loan program, which has been on
a pilot status since its creation in 2011, as a program
designed to reach communities traditionally underserved by
conventional lenders. The hearing also enabled Members to hear
perspectives from lenders and borrowers on whether the program
should be made permanent.
Witnesses on the panel were: Ms. Angela Mavridis, Owner,
Tribali Foods, San Marino, CA; Mr. Robert Villareal, Executive
Vice President, CDC Small Business Finance, San Diego, CA; Ms.
Janie Barrera, President and CEO, LiftFund, San Antonio, TX;
and Mr. John Kropf, President, Growth Capital Corp, Cleveland,
OH.
Ms. Mavridis testified regarding her experience as a
borrower in the Community Advantage program, and reported a
positive experience. According to Ms. Mavridis, the Community
Advantage loan she took out enabled her to jump-start her
business' growth, expanding distribution of her product to 35
states. Mr. Villarreal testified regarding his experience as a
lender in the program, and reported that the cumulative charge-
off rate on CA loans through FY2018 has been 2 percent, and the
cumulative default rate has been under 4 percent. He testified
that these rates are significantly lower than what SBA
anticipated when the CA pilot program was initiated. Ms.
Barrera similarly testified regarding her experience as a
lender in the program. She reported on several metrics she
argued demonstrated her organization has learned how to
mitigate risk: in 25 years of business, her organization's
average loan size is under $25,000, her borrower's average FICO
score is 590, and her organization has a 96 percent repayment
rate. Mr. Kropf, another CA lender, testified regarding the
benefits of the CA program's flexible structure that allowed
his organization to partner with a bank in Ohio to provide an
innovative financing structure that has, according to Mr.
Kropf's testimony, worked ``tremendously well'' for a high
volume limited balance sheet lender. Mr. Villarreal, Ms.
Barrera, and Mr. Kropf all called for making the CA program
permanent.
SMALL BUSINESSES AND THEIR LIMITATIONS WITHOUT RELIABLE ACCESS TO RURAL
BROADBAND
On Thursday, May 30, 2019, the Subcommittee on Contracting
and Infrastructure held a field hearing at Bulltear Industries
in Scandia, MN titled: ``Small Businesses and Their Limitations
Without Reliable Access to Rural Broadband.'' The hearing
allowed Members to focus on broadband deployment efforts in
rural America and the challenges small firms in those areas
face without reliable broadband services.
Witnesses included Mr. Adam Artz, Realtor, Realty
Executives, Blaine, MN; Mr. Marc Johnson, Director, East
Central Minnesota Educational Cable Cooperative, Braham, MN;
Mr. Greg Carlson, Executive Director of Partnered & Affiliated
Boards, Cambridge Presbyterian Homes, Roseville, MN; and Mr.
Matt Crescenzo, Owner, Bulltear Industries, Inc., Scandia, MN.
Mr. Artz testified that good internet is no longer a luxury
and top notch internet is a foundation of future growth. He
mentioned that the majority of all paperwork is sent, signed
and stored electronically and that's next to impossible with
current internet at his home. Mr. Johnson testified that small
businesses are the lifeblood of communities and rural areas in
East Central MN, throughout the state and around the nation. He
testified that agriculture, tourism, hospitality,
manufacturing, healthcare, retail and other sectors rely on the
Internet to communicate with suppliers and customers, to
provide their services and to stay viable. He also testified
that lack of adequate internet can impact the sustainability of
rural communities. He stated that without access to affordable
high-speed Internet, businesses cannot thrive, families are
less likely to locate in the area and it is difficult to
provide a fair and equitable education. Mr. Carlson testified
that work from home and business from home activities are
increasing as are technology-based health care making business
class broadband availability in rural neighborhoods an economic
development and safety issue. Mr. Crescenzo stated his business
relies on customer experience not volume but the network of
very happy customers to keep his company busy. He stated
adequate broadband is crucial to his company's success that so
that he can upload training videos, download customer files and
talk on the phone without interruption.
MIND THE `SKILLS' GAP: APPRENTICESHIPS AND TRAINING PROGRAMS
On Tuesday, June 4, 2019, the Subcommittee on Innovation
and Workforce Development held a hearing titled: ``Mind the
(Skills) Gap: Apprenticeships and Training'' The hearing
provided the Subcommittee the opportunity to hear from
workforce experts about the challenges facing small firms as
they create jobs and what efforts are being taken to address
the skills gap.
Witnesses included Mr. Joshua Broder, CEO, Tilson; Mr. Tim
Herbert, Vice President of Research, CompTIA; Mr. Ronald
Marlow, Vice President for Workforce Development, National
Urban League; and Mr. Talbot Gee, CEO, HARDI.
The panel emphasized the importance apprenticeships and job
training programs to close the skills gap. Mr. Broder shared
success stories from Tilson's apprenticeship program for tower
climbers. Mr. Herbert discussed the eminent importance of
building a cybersecurity workforces to combat the advancement
of cyber threats and the importance of building and nurturing a
pipeline of cybersecurity professionals.
SBA'S STATE TRADE EXPANSION PROGRAM: THE STATES' PERSPECTIVE
On Tuesday, June 11, 2019, the Subcommittee on Rural
Development, Agriculture, Trade, and Entrepreneurship held a
hearing titled: ``SBA's State Trade Expansion Program: The
States' Perspective.'' The purpose of the hearing was to review
the state of the SBA State Trade Expansion Program (STEP). The
Trade Facilitation and Trade Enforcement Act of 2015 directed
SBA to establish the program to provide grants to states to
increase the number of small businesses exploring trade
opportunities. The hearing allowed Members to hear the states'
perspectives on SBA's State Trade and Expansion Program (STEP)
and its effectiveness in providing export opportunities for
small businesses.
The witnesses for the hearing were: Mr. Wade Merritt,
President and State Director of International Trade at the
Maine International Trade Center; Ms. Jennifer Bacon, Co-
Founder of FlapJacked; Mr. Clifton Broumand, Founder and CEO of
Man & Machine, Inc.; and Ms. Jennifer Black, Executive Director
of Export Development for the Pennsylvania Department of
Community & Economic Development in the Office of International
Business Development.
Witnesses representing small business owners and state
trade representatives expressed overall support for the
program, but raised concerns with the timeline for awarding
grants, the lack of communication with SBA, and the complexity
of the reporting requirements. Mr. Wade testified to the
importance of the STEP program to help small businesses
penetrate international markets but raised concerns with SBA's
management of the program. Ms. Bacon testified in support of
the STEP program, which helped her get in front of retailers
directly and bypass expensive distributers and middlemen,
making it easier to offer products at affordable prices. Mr.
Broumand testified in support of the STEP program, which
`primes the pump' and sets business owners up with exporting
opportunities. He testified that sales do not always
materialize immediately, but sometimes farther down the road.
Ms. Black's testimony encouraged collaboration with states by
the SBA in an effort to alleviate complex reporting
requirements and administrative burdens, in addition to support
for the STEP program.
THE IMPORTANCE OF ACCURATE CENSUS DATA TO SMALL BUSINESS FORMATION AND
GROWTH
On Thursday, June 20, 2019, the Subcommittee on Economic
Growth, Tax, and Capital Access held a hearing titled: ``The
Importance of Accurate Census Data to Small Business Formation
and Growth'' The hearing provided the Subcommittee the
opportunity to hear from Small Business Development Centers
(SBDCs), Regional Chambers of Commerce, and Small Businesses
about the importance of census data.
Witnesses included Mr. Darrin Conroy, Library Directory, NY
Small Business Development Center, Albany, NY; Mr. James
Parker, President, Riverview Studios, Bordentown, NJ; Mr.
Jonathan Weinhagen, President & CEO, Minneapolis Regional
Chamber of Commerce, Minneapolis, MN; Ms. Jill Dietz, Regional
Center Director of Statewide Services, Oklahoma Small Business
Development Center, Tulsa, OK.
The Panel emphasized the importance of accurate census data
for the creation of small businesses. Mr. Conroy had a wealth
of data from the NY SBDC of times census data was used by SBDC
counselors to help small businesses choose a location and find
their target market. James Parker himself uses census data as a
way to make business decisions, and openly advocated for it on
behalf of the New Jersey Main Street Alliance. Mr. Weinhagen
emphasized that the amount of federal dollars that come into
Minnesota due to the census were essential to the startup of
new businesses because it funds infrastructure spending,
workforce development programs, and education. Ms. Dietz echoed
the many ways SBDC counselors use census data to help
entrepreneurs make foundational business decisions.
BROADBAND MAPPING: SMALL CARRIER PERSPECTIVES ON A PATH FORWARD
On Tuesday, June 25, 2019 the Subcommittee on Contracting
and Infrastructure held a hearing titled: ``Broadband Mapping:
Small Carrier Perspectives on a Path Forward.'' Access to
reliable high-speed broadband is a critical issue for small
businesses. Federal funds, through grants, loans, and taxes
direct funds to increase broadband throughout the U.S. The
hearing allowed Members of the Committee to hear about the need
for accurate broadband maps, current challenges and explored
ways that federal government and private sector can work
together to collect more accurate broadband coverage data.
Witnesses included Mr. Tim Donovan, Senior Vice President,
Legislative Affairs, Competitive Carriers Association,
Washington, DC; Ms. Beth Osler, Director, Customer and Industry
Relations, Unitel, Inc., Unity, ME; testifying on behalf of the
National Rural Electric Cooperative Association; Mr. Dan
Stelpflug, Director, Operations, Engineering & Technology,
Allamakee Clayton Electric Cooperative, Postville, IA;
testifying on behalf of the NTCA--The Rural Broadband
Association; and Mr. Jason Hendricks, Chief Regulatory Officer,
Range Companies, Forsyth, MT; testifying on behalf of the WTA--
Advocates for Rural Broadband.
Mr. Donovan testified that closing the digital divide is a
critical challenge, and it has a direct impact on our ability
to power all of these innovations. He stated that 5G will
supercharge existing services like telehealth and precision
agriculture, and enable new services such as augmented and
virtual reality, autonomous vehicles, and other innovations not
yet invented. Mr. Stelpflug testified that Electrical
Cooperatives primarily exist to provide reliable, clean and
affordable electricity to its members, they also provide robust
communications infrastructure including access to quality and
affordable broadband that enables rural communities to thrive
and compete in an increasingly connected, global marketplace.
Ms. Osler testified that getting broadband to and keeping
broadband in rural areas truly requires the best kinds of
public-private partnership. She explained that much of the
extensive network in Maine today is a result of private
investment. However, she mentioned that for those places where
densities are low and returns on infrastructure investments are
measured in decades, government support is important to help
make the business case. Ms. Osler has emphasized that to be
able to determine where limited resources for support should be
spent, and to ensure that incentives exist for private
investments where they can be justified, mapping of broadband
availability and identification of unserved areas are critical.
SBA MANAGEMENT AND OVERSIGHT OF SCORE
On Thursday, July 11, 2019, the Subcommittee on
Investigations, Oversight, and Regulations held a hearing
titled: ``SBA Management and Oversight of SCORE.'' SCORE is a
national, volunteer nonprofit organization comprised of 11,000
volunteers who provide free business mentoring services at
nearly 350 chapters nationwide. The Office of Inspector General
released an audit of the program in April 2019, which examined
SBA's oversight of the program's funds and its achievement of
program goals.
The witnesses for the hearing were: Mr. Hannibal ``Mike''
Ware, Inspector General, U.S. Small Business Administration;
and Mr. Allen Gutierrez, Associate Administrator, Office of
Entrepreneurial Development, U.S. Small Business
Administration.
Mr. Ware testified on the findings of the Office of
Inspector General's (OIG) report, which found that SBA did not
effectively oversee SCORE's use of federal funds. Mr. Ware
apprised the Committee of three criminal investigations for
potential instances of embezzlement and whistleblower
retaliation violations that resulted from the investigation.
The OIG found that SCORE commingled federal funds with
unrestricted donations and used federal funds for unallowable,
unallocable, and unsupported costs. The OIG also found that
SCORE charged for publication materials that did not include
the required SBA acknowledgement statement, and improperly
managed funds used for cosponsored activities. As a result, the
OIG questioned $713,986 of costs that did not adhere to the
cooperative agreement requirements or were not properly
supported. On a scale of 1 to 10 in terms of seriousness, Mr.
Ware testified that the findings were an 8. Mr. Ware testified
about the systemic issues in SBA's grant management function
and deficiencies in the oversight and monitoring of federal
funds. The lack of oversight, coupled with the IT issues with
EDMIS, hampered SBA's ability to detect waste, fraud, and
abuse, and further led to a culture in SCORE in which
whistleblowing was discouraged.
Mr. Gutierrez testified that he is deeply troubled by the
OIG's findings, and his office has taken steps to increase the
oversight of the program, which include revising the Standard
Operating Procedures (SOP), clarifying the whistleblowing
reporting language, developing guidance and training on federal
financial management at SCORE's upcoming National Leadership
Conference, and scheduling a financial examination of the SCORE
Association.
HELPING SMALL BUSINESSES COMPETE: CHALLENGES AND OPPORTUNITIES IN THE
FEDERAL PROCUREMENT MARKETPLACE
On Tuesday, July 16, 2019, the Subcommittee on Contracting
and Infrastructure met for a hearing titled: ``Challenges and
Opportunities in the Federal Procurement Marketplace.'' As part
of the Subcommittee's ongoing efforts to improve the
competitive viability of small businesses, the hearing examined
a variety of issues impacting small contractors, allowing
members to take a look at some of the common challenges faced
by small businesses in the federal contracting marketplace. The
hearing also provided an opportunity for small businesses to
explain how these issues directly affect their daily operations
and bring forward recommendations or potential solutions to
address them.
The witnesses for this hearing were: Ms. Belinda
Guadarrama, Founder and CEO of GC Micro, testifying on behalf
of GovEvolve--a group of small business IT value-added
resellers; Mr. Bruce Lansdowne, President and CEO of Trinity
Technology Partners, testifying on behalf of the Montgomery
County Chamber of Commerce; Mr. Thomas J. DePace, CTS, COO and
Sr. Engineering Manager, Advance Sound Company, testifying on
behalf of National Electrical Contractors Association and; Ms.
Dorothy Ann Callahan, Principal, D. Callahan, LLC.
Ms. Guadarrama made numerous recommendations such as
modifying the employee-based formula used to calculate size
standards in a similar fashion to the way the receipts-based
standard was modified through the Runway Extension Act; adding
SBA to the FAR Council and; increasing sole-source thresholds
while eliminating option years within the sole-source authority
in the different contracting programs. Furthermore, Mr. DePace
spoke about the cash-flow difficulties experienced by many
contractors in the construction sector and praised the
Committee's efforts for putting together H.R. 2344, which
requires partial payments for unilateral change orders
requested by the Government.
In general, there was an emphasis on subcontracting. For
example, Mr. Lansdowne suggested empowering the OSDBUs to
monitor compliance of subcontracting plans; requiring SBA to
report actual subcontracting dollars, not only percentages, in
the annual scorecard and; requesting GAO to conduct a study
about subcontracting authority, performance and processes.
Meanwhile, Ms. Callahan recommended requiring identification of
small businesses (their names) in subcontracting plans to
ensure primes are held accountable; assessing performance of
subcontracting plans as part of prime's annual evaluations and;
eliminating the ``good-faith effort'' standard in
subcontracting plans and replacing it with a pass/fail rating.
HOW REGULATIONS STIFLE SMALL BUSINESS GROWTH
On Monday, July 22, 2019, the Subcommittee on Economic
Growth, Tax, and Capital Access met at Oklahoma State
University--Tulsa in Tulsa, OK for a field hearing titled:
``How Regulations Stifle Small Business Growth.'' The hearing
enabled the Committee to generally examine the regulatory
landscape small businesses and entrepreneurs must navigate,
including its impact on their ability to successfully operate a
business, and the effect on their communities at large. Members
heard from a variety of witnesses who addressed how regulations
impact their businesses, industries, and their local
communities.
Witnesses on the panel were: Mr. Chad Selman, Owner, Selman
Farms, LLC, Skiatook, OK; Mr. Chris Jordan, President and CEO,
The Farmers State Bank, Stigler, OK (on behalf of the
Independent Community Bankers of America); Mr. Howard L.
Ground, Director of Regulatory Affairs, The Petroleum Alliance
of Oklahoma, Oklahoma City, OK; and Ms. Elizabeth Osburn,
Senior Vice President of Government Affairs, Tulsa Regional
Chamber, Tulsa, OK.
Mr. Selman testified regarding his experience hiring H-2A
immigrant workers, saying that because the program is so
complicated, he is forced to rely on third-party consultants
for hiring H-2A workers. Mr. Jordan testified regarding the
regulatory burdens faced by small community banks. He also
specifically noted that as cannabis-related businesses continue
to mature, they require access to the traditional banking
system, and that the conflict between state and federal law has
created increasingly significant legal and compliance concerns
for banks that wish to provide banking services to such
businesses in jurisdictions with legal cannabis. Mr. Ground
testified regarding the way small oil and gas producers must
comply with regulations promulgated by numerous federal
agencies, including the Environmental Protection Agency, the
Department of Interior, and the Department of Labor, among
others. Ms. Osburn testified that small businesses in the Tulsa
Regional Chamber report being burdened by reporting
requirements under the Affordable Care Act. She also warned of
the potential for unintended consequences in the way some
regulations can impact certain small businesses, such as those
in the food service industry.
SUPPORTING THE NEXT GENERATION OF AGRICULTURAL BUSINESSES
On Thursday, July 25, 2019, the Subcommittee on Rural
Development, Agriculture, Trade, and Entrepreneurship held a
hearing titled: ``Supporting the Next Generation of
Agricultural Businesses.'' The hearing allowed Members to hear
firsthand about the issues that are impacting young and
beginning farmers, as well as the programs and services
available that support our next generation of farmers and
agricultural entrepreneurs.
Witnesses on the panel were Mr. Matthew Keesling, Farm
Manager, Bures' Organic Family Farm, Deerbrook, WI; Mr. Jason
Grimm, Owner, Grimm Family Farm, Williamsburg, IA; Ms. Meri
Lillia Mullins, Farm Manager, Lighthearted Ranch, Longmont, CO;
Mr. Rodney Hebrink, President and CEO, Compeer Financial,
Lakeville, MN.
The panel discussed the current state of American
agriculture and the importance of supporting the new and
beginning farmers as they seek to access land, capital, and
programmatic support. Many of the witnesses noted the costs
associated with farming, and the importance of access to
capital in order to farm. Mr. Hebrink provided a strong
perspective from Farm Credit about the opportunities for
agricultural lending and highlighted many stories of new and
beginning farmers from a variety of operations who have been
able to develop successful agricultural businesses thanks to
the lending of Farm Credit.
One of the challenges that many younger farmers face is the
burden of student loan debt. Both Mr. Grimm and Ms. Mullins
articulating the many challenges and sacrifices they make in
order to farm while in debt, and the impacts that student loan
debt have on their ability to support and grow their farm
enterprises. Additionally, Mr. Grimm discussed the importance
of land access for young farmers and stressed the importance of
supporting tax and policies that promote the transfer of
farmland from older generations. Mr. Keesling discussed some of
the challenges that he had securing both capital and training
in agriculture, such as FSA beginning farmer requirements. Mr.
Keesling also discussed how his apprenticeship program set him
up for success for transition to farm ownership. He also
highlighted the importance of ensuring that VA education
support could go towards vocational training. All witnesses
agreed that agriculture is important to our country and our
communities, and that it is important to support those that
choose a career in agriculture.
EXPANDING OPPORTUNITIES FOR SMALL BUSINESSES AT MILITARY BASES
On Thursday, August 1, 2019, the Subcommittee on Economic
Growth, Tax, and Capital Access met for a field hearing in
Moorestown, New Jersey titled: ``Expanding Opportunities for
Small Businesses at Military Bases''. The hearing focused on
increasing procurement opportunities for small businesses with
the Federal Government, particularly with the Joint Base
McGuire-Dix-Lakehurst and at the state level (New Jersey).
The witnesses for the hearing were: Mr. John Whittington,
Business Representative, Sheet Metal Workers Local Union 27,
Farmingdale, NJ; Mr. Paul Costello, President of Del Ran
Business Association and Vice President of Sciacca's
Upholstery, Delran, NJ; Mr. Raul Mercado; Director of the New
Jersey Institute of Technology Procurement Technical Assistance
Center, Newark, NJ; and Mr. Jeff Cantor, Founder & CEO of NJ
State; Veterans Chamber of Commerce, Marlboro, NJ.
Testimony focused on the challenges small business face and
the fact that small businesses in the state are not getting
their fair share of contracting opportunities, especially with
the base. For example, Mr. Whittington's testimony emphasized
on the lack of information when it comes to procurement
opportunities with the base and insufficient lead times on
project information. Lack of access to project personnel and
contracting officers was another area highlighted by the
witnesses. Mr. Cantor recommended having procurement fairs at
the base where contracting officers can learn about the goods
and services small businesses can provide. Mr. Costello also
reiterated the need to encourage federal contracting personnel
to reach out to small businesses to learn about what they can
offer. Additionally, he suggested that the costs of entering
the federal marketplace and doing business with the government
should be kept within the reach of small businesses. Finally,
Mr. Mercado touched upon numerous concerns that hinder small
business participation. Some of the areas he discussed were:
the lack of awareness of available resources offered by PTACs,
inequitable funding of PTACS, burdensome information required
from small businesses and the fact that large prime contractors
should play a bigger role in small business procurement,
mentorship and training.
CONNECTING RURAL SMALL BUSINESSES TO BROADBAND: CHALLENGES, SUCCESSES,
AND HOW TO DO BETTER
On Friday, September 6, 2019, at University of Maine
Machias in Machias, Maine, the Subcommittee on Contracting and
Infrastructure met for a field hearing titled: ``Connecting
Rural Small Businesses to Broadband: Challenges, Successes, and
How to Do Better.'' This field hearing allowed Members of the
Committee to review the barriers to broadband infrastructure
deployment in rural America and ways increased federal
investment can help close the digital divide.
Witnesses included Mr. Mark Ouellette, President & CEO
Axiom Technologies, LLC Machias, ME; Mr. Chris Loughlin, Board
Member, Downeast Broadband Utility Town Manager, Baileyville,
ME; Ms. Lisa Hanscom, Co-Manager, Welch Farm & First Selectman
Roque Bluffs, ME; and Mr. Timothy R. McAfee, CEO, Pioneer
Broadband Houlton, ME.
As the CEO of a full-service internet service provider, Mr.
Ouellette's company delivers strategic and customized rural
broadband deployment solutions to remote customers and
communities across Maine. He testified that his company serves
some of the most difficult customers to reach, in some of the
most challenging and remote terrain in the United States.
Importantly, he testified that internet connectivity can
revitalize rural communities. Mr. McAfee testified that
existing federal grant programs are sometimes very difficult to
obtain. For example, he mentioned that the USDA Community
Connect Grant will pay for construction of a network to every
home but requires the operator to build and staff a community
center with computers and Internet access. Mr. Loughlin
emphasized that the fiber is the backbone of the Internet and
that the middle mile also consists of fiber. He testified that
the gap exists on the last mile because policy makers have
relied on private companies to set the agenda and use public
funds to connect customers with Digital Subscriber Lines (DSL),
cable, or fixed wireless lines that use copper based
technologies that are inadequate to the task of connecting
every American. He continually emphasized the need that that
the solution was rather simple to connect rural America and
that is to build fiber networks from the source of the Internet
to all homes and businesses.
GROWING THE CLEAN ENERGY ECONOMY
On Tuesday, September 10, 2019, the Subcommittee on Rural
Development, Agriculture, Trade, and Entrepreneurship met for a
hearing titled: ``Growing the Clean Energy Economy.'' Clean
energy is a driving force in the global economy. This hearing
discussed the importance of clean energy industries across the
country, outlined the challenges and opportunities for
advancing energy efficiency and renewable energy, and examined
what Congress can do to support small business engagement in
the clean energy economy.
Witnesses on the panel included Dr. Lynn Abramson,
President, Clean Energy Business Network, Washington, DC; Mr.
Thomas R. Brooks, General Manager, Western Dubuque Biodiesel,
Farley, IA; Mr. Michael G. Williams, Deputy Director, BlueGreen
Alliance, Washington, DC; and Mr. David J. Spigelmyer,
President, Marcellus Shale Coalition, Pittsburgh, PA.
At the hearing the panel discussed the diverse ways that
small businesses are engaged in the growing clean energy
economy. All of the witnesses discussed the potential for
growth in this space and highlighted the important role that
small businesses play. Dr. Abramson outlined the large number
of jobs and small businesses that are part of the clean energy
economy and pointed out specific policy recommendations that
Congress can take toward supporting the clean energy economy.
Mr. Brooks outlined the importance that biofuels production has
in rural America and highlighted the challenges that American
farmers and biofuels producers are dealing with thanks to the
Trump administration's handling of trade with China and the
Renewable Fuel Standards.
Mr. Williams outlined the important role that American
workers play in energy efficiency and clean energy technology.
He highlighted that labor and environmental goals can work hand
in hand, to ensure high-skilled jobs in the clean energy
economy. Mr. Williams outlined the importance for an aggressive
agenda that supports American leadership in clean energy
innovation and manufacturing, through rebuilding American
infrastructure. Mr. Spigelmyer talked about the economic
opportunities that fracking and natural gas extraction have
brought to certain parts of rural America, and the overall
boost to the economy that has been brought about by cheap
natural gas available through fracking. All witnesses agreed
that there are economic benefits to supporting a clean energy
economy, and that small businesses play a major role as
employers, manufacturers, and consumers within the clean energy
economy.
SBA PROGRAMS SPURRING INNOVATION
On Thursday September 19, 2019, the Subcommittee on
Innovation and Workforce Development held a hearing titled,
``SBA Programs Spurring Innovation.'' The hearing examined how
SBA's programs, such as the Small Business Innovation Research
(SBIR), Small Business Technology Transfer (STTR), and growth
accelerators help innovative entrepreneurs, startups, and small
businesses grow and create jobs.
Witnesses included, Ms. Alison Brown, President and CEO,
Navsys Corporation, Colorado Springs, CO, testifying on Behalf
of the Small Business Technology Council (SBTC); Mr. Rohit
Shukla, CEO, Larta Institute, Los Angeles, CA; Mr. Javier
Saade, Managing Partner & Venture Partner Impact Master
Holdings & Fenway Summer Ventures, Jackson, WY; and Mr. Ron
Shroder, CEO and President, Frontier Technology, Inc.,
Beavercreek, OH.
Ms. Brown voiced strong support for the SBIR program. She
reiterated that the SBIR program was established with the
purpose of strengthening the role of small, innovative firms in
federally funded research and development and remains today one
of the few successful paths for small businesses to bring
innovations into the hands of the warfighters. Mr. Shukla
testified that the SBIR program, known as America's seed fund
was designed so that the federal government as well as everyday
Americans, can reap the benefits of the technologies that their
tax dollars have already paid to develop. He detailed many
improvements to the SBIR program that would make the program
work even better. Mr. Saade mentioned that the American
innovation ecosystem is one of our country's crown jewels and
has been the leading source of economic growth and productivity
for more than half a century. He stressed that the Growth
Accelerator Fund Competition (GAFC) plays a small but important
part in supporting the nation's innovation ecosystem.
CAN OPPORTUNITY ZONES ADDRESS CONCERNS IN THE SMALL BUSINESS ECONOMY?
On Thursday, October 17, 2019, the Subcommittee on Economic
Growth, Tax, and Capital Access held a hearing titled: ``Can
Opportunity Zones Address Concerns in the Small Business
Economy?'' The hearing focused on what prospects the
Opportunity Zones enacted in the Tax Cuts and Jobs Act provide
for small businesses and local economic development.
Witnesses included Mr. Brett Theodos, Senior Fellow, Urban
Institute, Washington, D.C.; Mr. Aaron Seybert, Managing
Director of Social Investment Practice, The Kresge Foundation,
Troy, MI; Ms. Jennifer A. Vasiloff, Chief External Affairs
Officer, Opportunity Finance Network, Washington, D.C.; and Mr.
John Lettieri, President and Chief Executive Officer, Economic
Innovation Group, Washington, D.C.
Mr. Theodes testified that legislative and administrative
reforms are needed to ensure the federal government avoids
subsidizing deals that don't need the support. In particular he
mentioned that reforms are needed to prevent taxpayer forgone
revenues from being used locally in ways that taxpayers find
incongruent with their objectives. Mr. Seybert testified that
opportunity funds could help incentive new investors to enter
this market but he remains concerned that there is a mismatch
between the needs of small business owners and the incentives
in place for investors and fund managers. Ms. Vasiloff
testified that that the Opportunity Zone tax incentive is not a
good match for the kind of neighborhood revitalization deals of
interest to community development financial institutions,
particularly those targeting small businesses. She testified
that her experience, most investors are expecting double digit
returns, prefer real estate to small business investments and
largely shun the more challenging geographies that need an
infusion of capital the most.
HARVESTING THE DIGITAL AGE: CONNECTING OUR COMMUNITIES FOR A BETTER
FUTURE
On Monday, October 21, 2019, the Subcommittee on Rural
Development, Agriculture, Trade, and Entrepreneurship met at
Adams County Agriculture and Natural Resources Center in
Gettysburg, Pennsylvania. The field hearing titled:
``Harvesting the Digital Age: Connecting our Communities for a
Better Future'' provided an opportunity for the subcommittee
chair and ranking member to hear from community members in
rural Pennsylvania about the negative impacts of lack of
broadband access.
Witnesses on the panel included: Mr. Brandon Carson,
Director at the Southern Alleghanies Planning and Development
Commission; Mr. Mike Ross, President of FCADC; Mr. Anthony
Angelini, Teacher at New Oxford Middle School; and Mr. Brock
Widerman, President of Adams County Farm Bureau.
Mr. Widerman discussed the importance of having
connectivity on the farm in order to keep equipment maintained,
check on the health of the farm animals, and to ensure that
children of farm families have access to educational tools and
information. Mr. Angelini very clearly expressed the gaps in
educational and personal achievement between students that have
reliable internet access and those that do not. He expressed
concern for the increased disparities between those students
that are not able to access information or download lessons or
homework. Both Mr. Ross and Mr. Carson represent county or
multicounty development commissions. They highlighted the
challenges they face when attempting to develop and connect
business cites to broadband infrastructure for rural counties.
Mr. Carson also expressed some concern and challenges around
ownership of fiberoptic network cables. Overall, the desire was
expressed to close the digital divide, ensure rural homes and
communities have access to reliable broadband around the
country, and ensure that rural American is on a level digital
playing field with the rest of the nation.
NATIVE 8(A) CONTRACTING: EMERGING ISSUES
On Tuesday, October 22, 2019, the Subcommittee on
Investigations, Oversight and Regulations, held a hearing
titled: ``Native 8(a) Contracting: Emerging Issues.'' The
hearing provided a full overview of the 8(a) program as it
applies to native 8(a) contractors, including some of the
management weaknesses the Government Accountability Office
(GAO) identified. The hearing also discussed the program's
mission and overall performance; enabling Committee Members to
gain valuable insight and assess whether it is working as
intended.
The hearing had two panels. The first panel had one
witness: Mr. Seto Bagdoyan, Director of Forensic Audits and
Investigative Service, Government Accountability Office,
Washington, D.C. The second panel had five witnesses: Mr. Joe
Valandra, Executive Director of the Native American Contractors
Association, Washington, DC; Ms. Annette Hamilton, Chief
Operating Officer of Ho-Chunk Inc., Winnebago, Nebraska; Mr.
Edwin A. (Skip) Vincent, Chairman and Founder of the Hawaii
Pacific Foundation, Honolulu, Hawaii, testifying on behalf of
the Native Hawaiian Organization Association (NHOA); Ms. Jana
Turvey, President and CEO of Leisnoi, Anchorage, Alaska,
testifying on behalf of the Alaska Native Village Corporation
Association (ANVCA) and Ms. Christine V. Williams, Managing
Partner of Outlook Law LLC, Anchorage, AK.
Mr. Bagdoyan discussed the main findings of three GAO
reports on native 8(a) contracting that were issued between
2006 and 2016. These reports examine SBA's oversight of the
8(a) native contracting program and the lack of appropriate
controls to deal with the complexities of the program. In
particular, Mr. Bagdoyan detailed four key weaknesses that
undermine SBA's monitoring and oversight efforts. These
include: (1) incomplete information and documentation on ANC-
owned firms and their compliance with regulatory requirements;
(2) limitations in its ability to track and share key program
data needed to enforce its own program; (3) insufficient
staffing in its Alaska District Office to carry out necessary
and critical monitoring tasks; and (4) inadequate or vague
program guidance for clearly communicating to staff how to
interpret new regulations. Moreover, Mr. Bagdoyan explained
that, while many of the recommendations issued on those reports
were now closed based on SBA's intent to address them,
additional audit work would be needed to understand the extent
to which those recommendations have been implemented and the
potential impact they have had.
In the second panel, the witnesses--in representation of
Indian tribes, Alaska Native Corporations, Native Hawaiian
Organizations and stakeholders--provided an overview of the
program and explained the benefits it provides to entire
communities, which range from actual dividends to advancing
principles of self-sufficiency and self-determination.
Moreover, they explained key differences between how the
program works for them (as group-owned entities) versus how it
applies to individually owned firms. Finally, the members of
the panel presented multiple suggestions on how to improve the
program, including excepting 8(a) companies from category
management and tailoring SBA's certification system to make it
compatible with the documentation required from native 8(a)
entities.
CREATING THE CLEAN ENERGY WORKFORCE
On Tuesday, October 29, 2019, the Subcommittee on
Innovation and Workforce Development met in Room 2360 of
Rayburn House Office Building for a hearing titled: ``Creating
the Clean Energy Workforce.'' This hearing provided members of
the Subcommittee the opportunity to discuss the workforce
challenges faced by clean and renewable energy companies facing
a rapid transition of U.S. energy sources and rapidly
increasing consumer demand. Members heard from industry
leaders, labor unions, and training facility managers about how
to create the workforce necessary to transition our nation
rapidly from fossil fuels to renewable energy.
Witnesses included Mr. Mark Farrar Jackson, Vice President,
Community Housing Partners dba CHP Energy Solutions,
Christiansburg, VA; Mr. Jason L. Wardrip, Business Manager,
Colorado Building and Construction Trades Council, Aurora, CO;
Mr. Neil James, Vice President of Operations and Maintenance,
Apex Clean Energy, Charlottesville, VA; Mr. Ed Gilliland,
Senior Director, The Solar Foundation, Washington, D.C.
Mr. Jackson manages a 12,000 sq ft. training facility in
Virginia that trains energy efficiency workers. He testified
about the helpful grant money that was given to low income
households to make their homes more energy efficient. Mr.
Wardrip trains construction workers for his local union and he
testified to providing a just transition for coal workers by
retraining them using union apprenticeship programs. Neil James
testified about the problems that larger renewable energy
companies face attracting and retaining workers and laid out
some of the ways they are investing in their future workforce.
Ed Gilliland, the author of the solar jobs census published by
The Solar Foundation, testified about the broader economic
trends related to renewable energy as well as workforce
statistics.
FOSTERING THE AMERICAN DREAM: HOW SBA CAN EMPOWER IMMIGRANT SMALL
BUSINESS OWNERS
On Friday, November 8, 2019, the Subcommittee on
Investigations, Oversight, and Regulations met at Rosemead City
Hall in Rosemead, California for a field hearing titled:
``Fostering the American Dream: How SBA Can Empower Immigrant
Small Business Owners.'' Members had the opportunity to learn
why immigrants are more likely to start new businesses but less
likely to have access to traditional sources of capital and
Small Business Administration (SBA) programs that can help
immigrant business owners succeed.
The witnesses for the hearing were: Ms. Rachelle Arizmendi,
Vice-President and Chief Operations Officer, Pacific Asian
Consortium in Employment (PACE), Los Angeles, CA; Mr. Donald J.
Loewel, MBA, Director, Small Business Development Center,
Pasadena City College, Pasadena, CA; Ms. Tatiana Bonilla,
President, Andrew Design Group, Inc., Pasadena, CA; and Mr.
Amir Salahi, Founder and CEO, Energy Advisor Hub, Pasadena, CA.
The witnesses testified that increasing awareness of SBA's
programs is the number one opportunity to make a greater impact
on small business success. In addition, witnesses also
testified that additional support for multilingual SBA advisors
would greatly benefit the ability to interact with small
business owners whose primary language is not English. Lastly,
witnesses testified that leveraging community-based
organizations and Community Development Financial Institutions
(CDFIs) that have built trust within their communities in
imperative to the continued success of SBA's Community
Advantage and Microloan programs.
ASSESSING THE GOVERNMENT'S ROLE IN SERVING RURAL AMERICAN SMALL
BUSINESSES (PART ONE)
On Thursday, November 14, 2019, the Subcommittee on Rural
Affairs, Agriculture, Trade, and Entrepreneurship in Room 2360
of the Rayburn House Office Building held a hearing titled:
``Assessing the Government's Role in Serving Rural American
Small Businesses (Part One).''
The witnesses for the hearing were Ms. Bette Brand,
Administrator, United States Department of Agriculture, Rural
Business-Cooperative Service; and Ms. Michelle Christian,
Director of Rural Affairs, Small Business Administration.
At the hearing the witnesses testified about the wide
variety of federal programs at USDA and SBA that support rural
small businesses. Administrator Brand discussed several
programs and outlined how USDA partners with rural businesses
and service providers to support financial assistance and
business development in rural areas. Administrator Brand also
mentioned the importance of cooperative businesses that provide
a wide variety of important services in rural communities. Ms.
Christian outlined her role in coordinating with SBA district
offices and other federal agencies to assist rural communities
and entrepreneurs with access to small business resources. Both
witnesses also discussed the Memorandum of Understanding that
has signed in 2018 with the goals of strengthening rural
businesses and agricultural economies through increased
coordination between USDA and SBA.
SMART CONSTRUCTION: INCREASING OPPORTUNITIES FOR SMALL BUSINESSES IN
INFRASTRUCTURE
On Tuesday, November 19, 2019, the Subcommittee on
Contracting and Infrastructure met for a hearing titled:
``Smart Construction: Increasing Opportunities for Small
Businesses in Infrastructure.'' The hearing allowed Members of
the Committee to explore new developments in smart construction
technology and opportunities for small businesses to play a
major role in improving America's infrastructure.
Witnesses included, Mr. Lennart Anderssen, RA, Director of
Virtual Design, Construction & Operations (VDCO)/Professor,
LiRo Group/Pratt Institute, Irvington, NY; Mr. Ryan Forrestel,
President, Cold Springs Construction, Akron, NY; Mr. Chris
Shepard, Vice President, Construction Solutions Group, Trimble,
Inc., Dayton, OH; and Mr. Phillip Ogilby, CEO and Co- Founder,
STACK Construction Technologies, Cincinnati, OH.
Mr. Anderssen testified that all phases of construction are
poised to change and evolve in the coming years, incorporating
traditional tools of the trade and new technologies that could
transform the way projects are completed. Mr. Forrestel
testified that due to competitive contracting environment,
precision technologies allow his business to remain competitive
against bigger contractors. Mr. Shephard stated that the
construction industry is ripe for innovation. Mr. Shephard went
on to testify that technology is transforming construct roads,
bridges, and airports through the optimization of the entire
construction lifecycle: planning, design, construction and
operation. His company's experience in the construction
industry has taught him that ineffective communication,
planning and collaboration are causing the most problems and
driving project costs. As a result, he mentioned that digital
construction technologies are so important for small businesses
because it enables small businesses to better manage their
costs, schedules and resources.
INNOVATIONS IN THE SCHOOL TO SMALL BUSINESS PIPELINE
On Friday, November 22, 2019, the Subcommittee on
Innovation and Workforce Development met at the Cherry Creek
Innovation Campus in Aurora Colorado for a field hearing
titled: ``Innovations in the School to Small Business
Pipeline.'' This hearing gave members the opportunity to learn
about the innovative approaches that local schools in Colorado
are taking to combat the labor shortage in a number of in-
demand skill areas. By partnering with the private sector,
Cherry Creek constructed a brand-new facility that offers a
total of 7 career pathways that are meant to train high school
students to be work-ready upon graduation.
Witnesses included Ms. Sarah LC Grobbel, Assistant
Superintendent, Career & Innovation, Cherry Creek Schools,
Aurora, CO; Mr. Noel Ginsburg, Founder & CEO, CareerWise
Colorado, Denver, CO; Mr. Matthew Kaplan, Vice President,
Business Development and Membership, Outdoor Industry
Association, Boulder, CO; Testifying on behalf of Outdoor
Industry Association. Mr. Garry Edmonson, Program
Administrator, Colorado Journeyman & Apprentice Program IUOE
Local 9, Aurora, CO.
Ms. Grobbel testified about the progress made on the
innovation campus on which the hearing was held and how
important it is to train high school students for 21st century
jobs. Mr. Ginsburg testified about the CareerWise Colorado
statewide apprenticeship program for high school students that
prepares them for a number of different paths, while providing
classroom learning, on-the-job training and fair pay. Matthew
Kaplan provided testimony to about ways the outdoor industry is
training the next generation of workers through internships and
job training programs. Mr. Edmonson testified about the
possibilities for workers trained through their local unions
and how it can provide meaningful, in-demand skills that
produce a quality job and dignified life.
REVIEW OF THE SBA'S 504/CDC LOAN PROGRAM
On Tuesday, December 10, 2019, the Subcommittee on
Investigations, Oversight, & Regulations held a hearing titled:
``Review of the SBA's 504/CDC Loan Program.'' The hearing
enabled the Committee to learn about the 504/CDC loan program
as one that is designed to enhance access to capital for small
businesses seeking financing for major fixed assets such as
land, buildings, equipment, and machinery. Members also learned
about the nonprofit Certified Development Companies (CDCs) who
deliver the 504 loan product (and in some cases, other SBA loan
products), and the role they play in creating jobs in their
local communities. The hearing explored the current
administrative challenges facing the program and its industry
participants.
Witnesses on the panel were: Ms. Mary Mansfield, President
& CEO, Bay Colony Development Corp., Waltham, MA; Mr. Wayne
Williams, Senior Vice President, Business Finance Group Inc.,
Fairfax, VA; Ms. Elaine Fairman, Executive Director, Business
Expansion Funding Corp., Charlotte, NC; and Ms. Brooke Mirenda,
President & CEO, Sunshine State Economic Development Corp.,
Clearwater, FL.
Ms. Mansfield testified regarding the complex and lengthy
closing process for 504 loans, arguing that CDCs who have
demonstrated reliability and quality when working with
borrowers should be able to make certain de minimis changes to
closing documents with their own authority. She also testified
that numerous SBA district offices routinely require different
documents for closing a 504 loan, which can complicate and
further lengthen the closing process. Mr. Williams testified
regarding the challenges posed by current owner occupancy
requirements, which limit the ability of small businesses to
use the 504 program to finance the purchase of multi-story
buildings. Ms. Fairman testified regarding the rules governing
Eligible Passive Company/Operating Company (EPC/OC) procedures
and transactions, arguing that they have not been updated to
reflect current common business practices. Ms. Mirenda
testified regarding the 504 loan refinance program, and the
challenges some borrowers of government loan products face in
being unable to refinance that other government loan with a 504
loan. Ms. Mirenda argued that other non-504 government loans
should be eligible for refinancing with a 504 loan.
Second Session of the 116th Congress
FARMING IN THE 21ST CENTURY: THE IMPACTS OF AGRICULTURE TECHNOLOGY IN
RURAL AMERICA
On Thursday, January 9, 2020, the Subcommittee on
Innovation and Workforce Development held a hearing titled:
``Farming in the 21st Century: The Impacts of Agriculture
Technology in Rural America.'' This hearing gave Members the
opportunity to hear from experts in the agricultural technology
(ag tech) industry, farmers that are leveraging technology to
be more sustainable and profitable, and startups in the ag tech
field.
The witnesses were: Mr. Kevin France, President and CEO,
SWIIM Systems, Denver, Colorado; Dr. David Potere, Head of
GeoInnovation, Indigo Agriculture, Boston, Massachusetts; Mr.
Roberto Meza, Co-founder and Farmer, Emerald Gardens, Bennett,
Colorado who was testifying on behalf of the Rocky Mountain
Farmers Union; and Dr. Douglas Jackson-Smith, Assistant
Director, School of Environmental Resources, The Ohio State
University, Wooster, Ohio.
Witnesses outlined the many agriculture advancements that
ag tech has brought to our food systems and discussed the
importance of rural broadband access. Mr. France outlined the
importance of research and development to support small
businesses in ag and ag tech sectors, and his small business
has received support of both USDA and land grant universities.
Dr. Potere outlined the numerous small businesses that are
vital to our agricultural supply chains, and how technology and
innovation has helped advance food and agricultural systems.
Dr. Potere also highlighted the importance of ag tech to help
agriculture be more economically viable and resource efficient,
including addressing carbon sequestration and climate change.
As a farmer, Mr. Meza has first-hand experience integrating ag-
tech into his operation and outlined both the environmental
benefits of ag tech as well as some of the challenges and
barriers that farmers can face in bringing on new and sometimes
expensive technology into their operations. Dr. Jackson- Smith
discussed the structural challenges that small businesses face,
and the benefits that innovation and technological advancements
have brought to diversified agricultural systems.
TAKING CARE OF BUSINESS: HOW CHILDCARE IS IMPORTANT FOR REGIONAL
ECONOMIES
On Thursday, February 6, 2020, the Subcommittee on Rural
Development, Agriculture, Trade, and Entrepreneurship held
hearing titled: ``Taking Care of Business: How Childcare is
Important for Regional Economies.'' The hearing gave members
the opportunity to hear from experts about the economic impacts
of childcare accessibility on small firms, their employees with
a particular focus on the impact in rural economies.
Witnesses included: Ms. Cindy Cisneros, Vice President for
Education Programs at the Committee for Economic Development of
the Conference Board (CED), Arlington, Virginia; Mr. Dan Levi,
President of Levi Architecture, PLC., Cedar Falls, Iowa who
testified on behalf of the Black Hawk Child Care Coalition; Ms.
Sarah Piepenburg, Owner of Vinaigrette, Minneapolis, Minnesota
who testified on behalf of Main Street Alliance; and Dr.
Veronique de Rugy, Senior Research Fellow at the Mercatus
Center, George Mason University, Arlington, Virginia.
Witnesses all discussed how childcare is a necessity for
American families, communities, and small businesses. They
outlined how lack of affordable childcare impacts labor force
participation, but also inhibits regional and local economic
growth. Ms. Cisneros provided a detailed analysis of the
economics of childcare, discussing how the industry has robust
direct and indirect economic impacts. She presented information
on the clear connection between access to affordable, reliable
child-care and increased labor force participation and economic
growth in regional economies. Mr. Levi provided a first-hand
account of the challenges small business owners face when
confronted with lack of childcare opportunities in their
communities, and the steps that communities are trying to take
to establish adequate childcare. Ms. Piepenburg discussed the
economics of childcare from her prospective as a mother and
small business owner. She discussed the challenges that her and
her employees had in paying for childcare, and the sacrifices
they had to make in order to ensure adequate care for their
children. Dr. de Rugy discussed the licensing requirements of
childcare, and the regulations and other factors that have
impacted costs of childcare.
THE INNOVATION PIPELINE: FROM UNIVERSITIES TO SMALL BUSINESSES
On Tuesday, February 11, 2020, the Subcommittee on
Innovation and Workforce Development met for a hearing titled:
``The Innovation Pipeline: From Universities to Small
Businesses.'' During the hearing, Members heard from technology
transfer experts about the importance of federally funded
research for application in the private sector and the link
between the federal government, U.S. educational institutions,
and the development of businesses and job creation.
The panelists were: Dr. John Younger, MD, Vice President of
Science & Technology, University City Science Center,
Philadelphia, PA; Dr. Sheila Martin, PhD, Vice President,
Economic Development and Community Engagement, Association of
Publican and Land-grant Universities, Washington, DC.; Dr.
Ethan Mann, PhD, Vice President of Marketing and Business
Development, Sharklet Technologies, Inc., Aurora, CO; and Dr.
Gregory P. Crawford, PhD, President, Miami University, Oxford
OH.
Dr. Younger testified about the challenges small firms face
when commercializing new technology created in University labs,
particularly in pharmaceuticals technology. He emphasized some
of the bottlenecks in the SBIR and STTR programs and
recommended streamlining guidance. Dr. Martin testified about
the importance of the public and land grant university system
in creating technology and entrepreneurial talent that allows
local economies to grow. Dr. Mann testified about his own
experience, bringing sharklet technology, a medical device
company that uses biomimicry for its products, from university
labs to the market. Dr. Crawford echoed the sentiments of Dr.
Martin, but expanded upon the accomplishments of his own
school, Miami University, in prioritizing entrepreneurship and
technology transfer.
MOVING AMERICA'S INFRASTRUCTURE FORWARD
On Thursday, February 27, 2020, the Subcommittee on
Contracting and Infrastructure held a hearing titled: ``Moving
America's Infrastructure Forward.'' The hearing focused on how
to make small business a priority as Congress explores ways to
improve the nation's infrastructure networks. The hearing
provided an opportunity for members to hear from a variety of
witnesses regarding the importance of updating our nation's
infrastructure, while discussing the opportunities and
challenges that exist for small businesses.
The witnesses for the hearing were: Ms. Lynn Frazier,
Director and Senior Transportation Engineer for James W. Sewall
Company; Ms. Lisa Jacobson, President of the Business Council
for Sustainable Energy; Mr. Mike Saperstein, Vice President of
Strategic Initiatives and Partnerships for USTelecom--The
Broadband Association; and Mr. Todd Rothe, President of J.R.
Jensen Construction Company.
The witnesses testified how the nation's infrastructure has
not kept up with our economy, our communities, and how further
investments in infrastructure are needed. Ms. Lynn Frazier
provided information about the American Society of Civil
Engineers' estimate that America's infrastructure would need an
additional investment of $4.6 trillion in order repair the
nation's broken infrastructure system. Additionally, the
witnesses emphasized how the House Transportation and
Infrastructure Committee's Moving Forward Framework will help
local economies, small businesses, and our nation as a whole.
Ms. Lisa Jacobsen testified that improvements in infrastructure
would improve the nation's economic competitiveness and how
infrastructure investment has the potential to create tens of
thousands of jobs. Finally, Mr. Saperstein testified that an
investment in infrastructure--particularly in an investment in
rural broadband--would greatly benefit America's small
businesses.
SOUTH DAKOTA V. WAYFAIR, INC.: ONLINE SALES TAXES AND THEIR IMPACT ON
MAIN STREET
On Tuesday, March 3, 2020, the Subcommittee on Economic
Growth, Tax, and Capital Access held a hearing titled: ``South
Dakota v. Wayfair, Inc.: Online Sales Taxes and their Impact on
Main Street.'' The hearing focused on the impact to small
businesses as a result of the U.S. Supreme Court's decision in
South Dakota v. Wayfair. In Wayfair, the Court overturned a
previous ruling where it determined that states could only
collect sales tax from businesses that had brick and mortar
locations in those states.
The witnesses for the hearing were: Mr. Jamie Yesnowitz,
Principal at Grant Thornton, LLP; Mrs. Linda Lester, Vice
President of K Log, Inc.; Mr. Kevin Mahoney, President and
Founder of FindTape.com; and Mr. Brad Scott, Financial Director
of Halstead Bead, Inc.
Mr. Jamie Yesnowitz testified that the Wayfair decision has
resulted in a web of inconsistent, complicated, and burdensome
state and local sales and income tax requirements across the
country--especially for the nation's smallest businesses. Mrs.
Linda Lester testified that following the Wayfair decision her
company went from filing a return in just one state (Illinois)
to filing in 42 states, at a cost of approximately $78,722. Mr.
Scott testified that he has spent $27,900 to implement software
to meet his requirement to file with 51 separate states and
territories.
Additionally, the witnesses testified about the unintended
consequences of the Wayfair decision. Mr. Mahoney testified
that his two-person company that sold tape on Amazon was
audited by the state of Washington because his product was
trans-shipped through the state. Mr. Scott testified that the
state of Wyoming threatened a lien on his property for a tax
assessment of $100 for December 2018, for a failure to file a
$0.00 return.
AN OVERVIEW OF THE DYNAMIC BETWEEN THE DEFENSE PRODUCTION ACT AND SMALL
CONTRACTORS
On Wednesday, June 24, 2020, the Subcommittee on
Contracting and Infrastructure held a remote hearing titled:
``An Overview of the Dynamic Between the Defense Production Act
and Small Contractors.'' The hearing provided an overview of
the Defense Production Act (DPA) and its authorities, including
those that relate to small businesses. It also examined how
those authorities could be leveraged to assist small firms
affected by the COVID-19 pandemic and what legislative actions
could be taken to strengthen the DPA on behalf of our small
business industrial base.
The witnesses for the hearing were: Mr. Ian Patterson,
Senior Associate, Koprince Law, Lawrence, KS; Mr. David Black,
Partner, Holland & Knight, Tysons, VA; Ms. Mary Lockhart,
President & CEO, PEMDAS Technologies & Innovations, Alexandria,
VA, testifying on behalf of the National Defense Industrial
Association (NDIA) Small Business Division; and Ms. Traci
Tapani, Co-President, Wyoming Machine, Inc., Stacy, MN.
Mr. Patterson expressed that, while the DPA confers
preferential treatment to small businesses in all of its
authorities, it does not provide any further instruction as to
how small business participation should be accomplished. Thus,
he emphasized on the need for data to evaluate the use of small
businesses in the DPA. Similarly, Mr. Black expressed that DPA
small business provisions were either not being followed or
underutilized and agreed on the need for data collection.
Moreover, he provided multiple recommendations to ensure these
provisions work cohesively, such as: establishing procedures to
apply the Title III small business preference, establishing a
small business advisory subcommittee that includes small
business concerns, and requiring information on how agencies
are making information about DPA activities available to small
businesses, as required in statute. Finally, Ms. Lockhart
stressed the importance of maximizing small business
participation in DPA Title III authorities, while Ms. Tapani
focused on small businesses willingness and ability to mobilize
to address the needs of the COVID-19 pandemic.
SUPPLY CHAIN RESILIENCY
On Thursday, July 2, 2020, the Subcommittee on Economic
Growth, Tax, and Capital Access met for a hybrid hearing
titled: ``Supply Chain Resiliency.'' During the hearing,
Members heard from economists, supply chain experts, and small
business owners about the effects of the COVID-19 pandemic on
world supply chains and particularly how it hurt small firms,
and explored ways we can strengthen our supply chains as we
rebuild to prepare for the next disaster.
The panelists were: Dr. Eswar Prasad, Ph.D., Professor of
Trade Policy, Cornell University, Senior Fellow, Brookings
Institution, Ithaca, NY; Ms. Christine Fagnani, Co-Owner and
Vice President of Lynn Medical Instrumentation Company, Wixom,
MI; Mr. David Billstrom, CEO, Kitsbow Cycling Apparel, Old
Fort, NC; Ms. Sheila Lawson, Chief Operations Officer and Vice
President of Supply Chain, RL Hudson, Broken Arrow, OK.
Dr. Prasad testified about the different effects of certain
steps taken by firms and governments to strengthen supply
chains, and clearly laid out the upsides and downsides of
taking these steps. For instance, emphasizing that making
supply chains less linear and specialized would avoid
disruption if there is a disaster, but would also cut down on
the efficiency of those supply chains, therefore causing hire
prices and longer wait times. Ms. Fagnani explained the early
effects of the COVID-19 pandemic on the medical supply chains,
and the steps her company took to ameliorate the problems
caused by global supply chain disruptions by sourcing PPE from
small firms in the U.S. Mr. Billstrom testified about the steps
his company took prior to the pandemic to become more
resilient, and how those steps allowed him to quickly shift
operations to manufacture PPE early in March, and almost double
his staff by the middle of June. Ms. Lawson explained the
problems in the heavy machinery and rubber supply chains, how
the pandemic affected her company, and the steps they took to
get back on track.
PUTTING AMERICA BACK TO WORK: THE ROLE OF WORKFORCE DEVELOPMENT AND
SMALL BUSINESS REHIRING
On Thursday, July 16, 2020, the Committee Subcommittee on
Innovation and Workforce Development held a remote hearing
titled: ``Putting America Back to Work: The Role of Workforce
Development and Small Business Rehiring.'' During the hearing,
members heard from workforce development policy experts,
workforce board chairs, a community college president, and a
small business owner about ways we can retrain many unemployed
workers in the U.S. right now to get the economy back on track
and speed up hiring during the recovery.
The panelists were: Dr. Demetra Smith Nightingale,
Institute Fellow, Urban Institute, Washington D.C.; Ms. Kelly
Folks, Workforce Director, Arapahoe/Douglas Workforce Center,
Centennial, CO; Dr. Joe Schaffer, President, Laramie County
Community College, Cheyenne, WY; and Ms. Kelly Moore, Vice
President, GKM Auto Parts, Inc., Zanesville, OH.
As a former DOL employee during the Obama Administration,
Dr. Nightingale testified about the lessons they learned during
the last recovery, particularly the importance of avoiding
long-term unemployment for those that lose their job during the
pandemic. Ms. Folks testified about the needs of local
workforce boards, who are not only overwhelmed handling UI, but
also inundated with newly unemployed workers who need
retraining to find another job. Dr. Schaffer testified about
the importance of community colleges not only for training
workers, but for creating a new generation of workers that will
revitalize places in rural America and help grow the economies
of small towns that have suffered as their children move to
cities. Ms. Moore testified about the struggle of hiring
qualified employees, even when the pool of people looking for
jobs is large, and the resources they must dedicate to train
new ones.
21ST CENTURY SBA: AN ANALYSIS OF SBA'S TECHNOLOGY SYSTEMS
On Wednesday, July 22, 2020, the Subcommittee on
Investigations, Oversight, and Regulations held a hybrid
hearing titled: ``21st Century SBA: An Analysis of SBA's
Technology Systems.'' The purpose of the hearing was to review
the SBA's modernization efforts of its IT infrastructure and
technology systems and how these systems performed during the
coronavirus pandemic. The hearing allowed members to examine
the SBA's IT organizational structure and its response to the
technological issues that borrowers and lenders faced when
applying for the economic relief programs.
The sole witness for the hearing was Mr. Guy Cavallo, the
Chief Information Officer of the Small Business Administration.
Mr. Cavallo testified that over the past three years the
SBA has focused on building the foundation to deliver IT
modernization across the organization. He said that they
upgraded the network infrastructure connecting all SBA offices
and began the transition to the cloud, however, he testified
that data is still siloed between offices. Mr. Cavallo
testified that the SBA plans to replace its legacy loan
processing system, E-Tran, but that it could take several
years. He also shared that SBA launched six new cloud-based
system to support the high demand during the coronavirus
pandemic and shed light on the data ``exposure'' incident. He
testified that the exposure (he stated that it was not a data
breach) occurred due to a system glitch that was quickly
corrected.
KICK STARTING ENTREPRENEURSHIP AND MAIN STREET ECONOMIC RECOVERY
On Thursday, September 10, 2020, the Subcommittee on Rural
Development, Agriculture, Trade, and Entrepreneurship met for a
remote hearing entitled ``Kick Starting Entrepreneurship and
Main Street Economic Recovery.'' The hearing focused on why the
COVID-19 pandemic has presented unique challenges for rural
economies. It also focused on what worked and did not work to
encourage rural development and entrepreneurship during and
after the Great Recession and how these lessons can be applied
to the current COVID-19 crisis.
The witnesses for the hearing were: Mr. Chad Nath,
Executive Director LINK Grinnell; Mr. Jeremy Ketelsen, Vice
President Ketelsen RV; Mr. Mark Rembert, Head of the Rural
Innovation Network at the Center on Rural Innovation; and Mr.
Jason Duff Founder Small Nation.
The witnesses testified about the challenges each of their
businesses have faced during the COVID-19 pandemic.
Specifically, Mr. Nath testified how LINK adapted to the COVID-
19 pandemic by pivoting from an aftercare program to a program
that provided care for essential worker's children. While Mr.
Ketelsen discussed how inventory shortages faced by his
business has made staying open and staying profitable
difficult. Mr. Rembert testified that the economic realities in
rural America that were exposed during the Great Recession, has
intensified during the COVID-19 pandemic. Specifically, he
discussed how lack of rural broadband has held rural
communities back from gains in economic development and
entrepreneurship.
SBA MANAGEMENT REVIEW: OFFICE OF GOVERNMENT CONTRACTING AND BUSINESS
DEVELOPMENT
On Tuesday, September 15, 2020, the Subcommittee on
Contracting and Infrastructure held a hybrid hearing titled:
``SBA Management Review: Office of Government Contracting and
Business Development.'' The focus of the hearing was the
operations of SBA's Office of Government Contracting and
Business Development (GCBD), which assists small businesses
that participate in the federal procurement space by
administering SBA's business development and contracting
programs.
The sole witness for this hearing was Dr. Francis
Spampinato, Associate Administrator of the Office of Government
Contracting and Business Development, U.S. Small Business
Administration, Washington, D.C.
Dr. Spampinato highlighted that $132 billion was awarded to
small businesses in fiscal year 2019. Despite this success, Dr.
Spampinato explained that COVID-19 has resulted in significant
challenges to small businesses, and that is why the Office has
implemented measures such as posting guidance for small
business contractors, introducing flexibilities in 8(a) and
HUBZone program participation and conducting a robust outreach
to small businesses to connect them with Federal agencies in
need of products and services to combat COVID-19. Moreover, Dr.
Spampinato acknowledged the decreasing number of firms that are
involved in federal contracting and receiving prime contract
awards, which has prompted engagements with Federal agencies,
small business leaders and senior acquisition officers to
understand why this is happening and how to address the
situation. He also stressed on the importance of conducting
research and obtaining data to understand the impacts of
Category Management and the Cybersecurity Maturity Model
Certification initiative (CMMC) on the small business base, as
well as what can be done in the area of subcontracting to
address this issue.
To questions from Committee Members, Dr. Spampinato
recognized that the HUBZone prime contracting goal was not met
in fiscal year 2019. However, he affirmed there has been an
increase in HUBZone awards in the past years and that SBA has a
HUBZone plan underway--composed in part by statutory changes to
the program and targeted outreach--to meet and surpass the
HUBZone prime contracting goal. Moreover, he expressed his
commitment to getting a new IT system in place to serve the
contracting programs and his interest in providing an
additional focus on subcontracting to meet the small business
set-aside subcontracting goals.
PAYCHECK PROTECTION PROGRAM: AN EXAMINATION OF LOAN FORGIVENESS, SBA
LEGACY SYSTEMS, AND INACCURATE DATA
On Thursday, September 24, 2020, the Subcommittee on
Innovation and Workforce Development held a hybrid hearing
titled: ``Paycheck Protection Program: An Examination of Loan
Forgiveness, SBA Legacy Systems, and Inaccurate Data.'' The
purpose of the hearing was to review the Paycheck Protection
Program from a technical perspective. SBA's legacy technology
systems were not fully equipped to handle the unprecedented
level of applicants, resulting in a number of technical issues
with the implementation. The hearing allowed members the
opportunity to address these issues and the related concerns
about the accuracy of the recently released PPP data, as well
as learn more about SBA's new system for PPP forgiveness.
The witness for the hearing was Mr. William Manger, the
Chief of Staff of the SBA and the Associate Administrator of
the Office of Capitol Access at the Small Business
Administration.
Mr. Manger testified that OCA has issued public guidance
and continues to refine processes and requirements for loan
forgiveness, loan reviews, guaranty purchases, and related
activities under Section 1106 of the CARES Act. He also
testified that the SBA has not approved any forgiveness
applications as of September 24, 2020. In terms of data
accuracy, Mr. Manger stated that PPP loan data reflects the
information submitted by lenders to the SBA for PPP loans and
that between the data releases, SBA made significant efforts
and worked with lenders to improve the accuracy of the loan-
level data, including the improvement of congressional district
loan data.
A REVIEW OF PPP FORGIVENESS
On Friday, September 25, 2020, the Subcommittee on Economic
Growth, Tax, & Capital Access met for a hybrid hearing titled:
``A Review of PPP Forgiveness.'' During the hearing, Committee
Members learned about the current state of PPP forgiveness from
borrowers' and lenders' perspectives. Members heard primarily
from PPP borrowers who reported serious concerns with the
length and complexity of the PPP forgiveness applications,
especially the documents required to be able to properly and
accurately report all the requested information. Members also
heard from a 7(a) lender who reported concerns of lenders,
specifically the lack of clarity with regard to the lender's
role in the forgiveness process.
The witnesses were: Ms. Lynn Ozer, President of SBA
Lending, Fulton Bank, Pottstown, PA; Ms. Amy Bonfig, Owner,
Little Saints Academy, St. Joseph, MN; Mr. Jim Parker; CEO &
Director, Riverview Studios, Bordentown, NJ; and Mr. Pete
Patel, President & CEO, Promise Hotels, Tulsa, OK.
Ms. Ozer testified on concerns shared by PPP lenders across
the country, including a lack of clarity from SBA/Treasury on
the lender's role in the PPP forgiveness process. According to
Ms. Ozer, the lending community never envisioned being
responsible for verifying the accuracy of borrowers'
forgiveness applications and their accompanying documentation.
Ms. Bonfig testified from the perspective of a PPP borrower who
had completed the lengthier PPP forgiveness application and
reported the significant burdens associated with completing all
parts of the application, especially the employee counts at
various times during the 8-week vs. 24-week periods. Mr. Parker
testified about his perspective on PPP forgiveness as a
microbusiness and reported concerns that other rules were put
in place following the enactment of the CARES act about
spending PPP loan proceeds on fixed costs. Mr. Patel testified
as a hotel owner regarding the unique challenges his travel-
dependent business is facing in the midst of the COVID-19
pandemic. He urged Congress to expand access to the Main Street
Lending Program for asset- based businesses such as hotels.
PREVENTING FRAUD AND ABUSE OF PPP AND EIDL: AN UPDATE WITH THE SBA
OFFICE OF INSPECTOR GENERAL AND THE GOVERNMENT ACCOUNTABILITY OFFICE
On Thursday, October 1, 2020, the Subcommittee on
Investigations, Oversight, and Regulations met for a hybrid
hearing titled: ``Preventing Fraud and Abuse of PPP and EIDL:
An Update with the SBA Office of Inspector General and the
Government Accountability Office.'' During the hearing,
Committee Members heard from the Small Business
Administration's (SBA) Inspector General (IG) and the
Government Accountability Office (GAO) about their recent
reports detailing fraud, and the potential for fraud, in the
Paycheck Protection Program (PPP) and Economic Injury Disaster
Loan (EIDL) program.
The witnesses were: Mr. Hannibal ``Mike'' Ware, Inspector
General, Office of the Inspector General (OIG), SBA; and, Mr.
William Shear, Director, Financial Markets and Community
Investment, GAO.
Inspector General Ware testified about the OIG's July 28
Management Report, detailing instances of fraud found in the
EIDL program and the potential for further fraud due to SBA's
lack of internal controls. Mr. Shear testified about the GAO's
August and September reports on the federal response to the
COVID-19 pandemic. Mr. Shear focused on the SBA components of
the pandemic response and supported the IG's findings that
there is a high potential for fraud in the PPP and EIDL
programs. In addition, Mr. Shear testified that SBA has not
provided the necessary EIDL internal data and documents for GAO
to complete their audit objectives.
PART C
Waste, Fraud, Abuse and Mismanagement
Of the hearings delineated above, the following were
devoted specifically to an examination of programs within the
Committee's jurisdiction with a focus on potential
mismanagement, waste, fraud and abuse.
HEARINGS ON SBA MANAGEMENT AND BUDGET
The Committee continued its oversight of the management of
SBA through hearings and meetings with agency officials and
stakeholder groups.
During 2019 and early 2020, prior the COVID-19 pandemic,
numerous SBA officials, industry representatives and small
business owners were questioned about the operation of SBA
programs:
A Committee hearing on the federal
government shutdown of 2018-2019 was conducted on
February 6, 2019.
A series of management review hearings with
SBA Associate Administrators, officers, or directors
was conducted on February 26, 2019, April 10, 2019,
April 30, 2019, July 11, 2019, September 26, 2019,
November 14, 2019, January 29, 2020, and February 5,
2020. The GAO testified about reports they issued at
the hearings on April 30, 2019, and May 16, 2019. The
SBA OIG testified about a report they issued at the
hearings on July 11, 2019.
Hearings on SBA's State Trade Expansion
Program (STEP) were held on March 12, 2019 and June 11,
2019. The GAO and SBA OIG testified at the March 12,
2019 hearing on their respective reports on STEP.
Hearings on SBA's Office of Rural Affairs
were held on March 12, 2019 and November 14, 2019.
A Committee hearing on SBA's disaster loan
program was held on July 19, 2019.
A Committee hearing on the SBA Office of
Inspector General's Report on the ``Most Serious
Management Challenges Facing the Agency'' was conducted
on October 16, 2019.
A Committee hearing on the SBIR and STTR
programs was held on February 11, 2020.
A Committee hearing with Administrator
Jovita Carranza on the Agency's FY2021 budget
justification was conducted on February 26, 2020.
Starting in May 2020, after COVID-19 became a national
pandemic, the Committee held numerous virtual forums and
hearings on SBA's implementation of emergency response
legislation and programs, notably those that were created under
the CARES Act.
A Committee hearing on SBA's COVID-19
Economic Injury Disaster Loan (EIDL) and Advance
programs was held on July 1, 2020. The SBA Associate
Administrator for the Office of Disaster Assistance
(ODA) was the sole witness.
A Committee hearing on the federal
government's small business stimulus programs was
conducted on July 20, 2020. SBA Administrator Jovita
Carranza and Treasury Secretary Steve Mnuchin both
testified.
A Committee hearing on SBA's Information
Technology Systems and COVID-19 programs was held on
July 22, 2020. The SBA Chief Information Officer (CIO)
was the sole witness.
A Committee hearing on contracting was
conducted on September 15, 2020. The Associate
Administrator of Government Contracting and Business
Development (GCBC) was the sole witness.
A Committee hearing on the Paycheck
Protection Program was conducted on September 24, 2020.
The Associate Administrator of the Office of Capital
Access (OCA) was the sole witness.
A Committee hearing on PPP and EIDL was held
on October 1, 2020. The GAO and OIG both testified on
reports they issued and were the only witnesses.
HEARINGS ON SBA FINANCIAL ASSISTANCE PROGRAMS
In the 116th Congress, the Committee continued its focus on
SBA's capital access programs. During 2019 and early 2020,
prior the COVID-19 pandemic, numerous SBA officials, industry
representatives and small business owners were questioned
regarding frequent concerns about the struggle for small
businesses to access capital to fund their operations.
Hearings were held on SBA's capital access
programs on March 7, 2019, April 10, 2019, May 21,
2019, June 26, 2019, September 26, 2019, October 17,
2019, December 10, 2019, February 5, 2020, and February
12, 2020.
Beginning in May 2020, the Committee held numerous virtual
forums and hearings on SBA's implementation of the Paycheck
Protection Program and EIDL Advance program, created by the
CARES Act, and the underlying EIDL program.
Hearings were held on SBA's COVID-19 related
capital access programs on June 10, 2020, June 17,
2020, July 15, 2020, September 24, 2020, September 25,
2020, and October 1, 2020.
A virtual forum with the SBA OIG was held on
May 15, 2020.
Virtual forums were held on SBA's COVID-19
related capital access programs May 13, 2020, and May
20, 2020.
HEARINGS ON FEDERAL PROCUREMENT
During the 116th Congress, the Committee continued to
examine federal procurement rules as they affect small
businesses.
Hearings were held on SBA's federal
contracting programs on March 26, 2019, May 16, 2019,
July 16, 2019, August 1, 2019, September 18, 2019,
October 22, 2019, and Sept 15, 2020. The GAO testified
about a report they issued at the hearing on October
22, 2019.
HEARINGS ON SBA ENTREPRENEURIAL DEVELOPMENT PROGRAMS
During the 116th Congress, the Committee continued to
examine SBA's Entrepreneurial Development programs. During 2019
and early 2020, prior the COVID-19 pandemic, numerous SBA
officials, industry representatives and small business owners
were questioned regarding delivery of the entrepreneurial
development programs.
Hearings on SBA's entrepreneurial
development program were held on February 27, 2019,
April 30, 2019, June 20, 2019, July 10, 2019, July 11,
2019, and October 23, 2019.
Beginning in May 2020, the Committee held virtual forums on
SBA's implementation of the changes and funding increases
provided to the entrepreneurial development programs under the
CARES Act.
Virtual forums on SBA's COVID-19 related
entrepreneurial development programs were held on May
7, 2020, and May 28, 2020.
PART D
Implementation of the Oversight Plan of the Committee on Small Business
for the One Hundred and Sixteenth Congress
Subpart 1--Oversight of Federal Capital Access Programs
GENERAL ACCESS TO CAPITAL PROGRAMS
7(a) Program
SBA's Congressional Budget Justification for FY2020
predicted that SBA would not achieve a zero-subsidy rate for
the 7(a) program, meaning the 7(a) program would not generate
sufficient revenue through fee collections and/or recoveries of
collateral on defaulted loans, and would require either an
appropriation of $99 million from Congress in order to operate,
or fee increases. It should be noted the program has operated
at zero subsidy since FY 2014. To address the potential
shortfall, SBA opted to propose numerous fee increases on 7(a)
borrowers and lenders.
Many 7(a) program stakeholders raised concerns regarding
the changes made to the econometric models SBA uses in
conjunction with Office of Management and Budget (OMB) to
generate these subsidy projections. On April 10, 2019, the
Committee held a hearing to assess these concerns, as well as
the impact 7(a) fee increases would have on access to capital
for small businesses. On May 6, 2019, Chairwoman Nydia M.
Velazquez, Ranking Member Steve Chabot, Subcommittee on
Economic Growth, Tax, and Capital Access Subcommittee Chairman
Andy Kim, and Ranking Member Kevin Hern sent a letter to the
Government Accountability Office (GAO) to request an evaluation
of SBA's FY2020 budget submission for the 7(a) program,
including SBA's budget estimation modeling. On September 30,
2020, GAO published its findings that SBA generally
incorporated cost estimation practices previously identified
that can help agencies make reasonable, reliable estimates, and
that the increase in the estimate was largely due to SBA's use
of updated assumptions and calculation methods.
504/Certified Development Company Program
On December 10, 2019, the Subcommittee on Investigations,
Oversight, and Regulations held a hearing to review SBA's 504/
Certified Development Company (CDC) program. During the
hearing, Subcommittee Members heard from a panel of CDCs
regarding the current status of the program, as well as changes
recommended to improve its reach and operation of the program.
For example, CDCs on the panel testified that changes to
occupancy requirements in the program would make it easier for
504 loans to finance the purchase of multi-story buildings.
CDCs also testified regarding the benefit to borrowers and
lenders of streamlining the 504 loan closing process. On
September 16, 2020, the Committee marked-up two bills to
improve the 504 program, both of which were reported
unanimously to the House.
Community Advantage Program
On May 21, 2019, the Subcommittee on Investigations,
Oversight, and Regulations held a hearing to review SBA's
Community Advantage loan program. During the hearing,
Subcommittee Members heard from a panel of Community Advantage
lenders and borrowers about their experiences with the program.
Specifically, the lenders on the panel urged Members to codify
the program to provide long-term stability to the program. On
March September 16, 2020, the Committee marked-up a bill to
authorize the Community Advantage program under the Small
Business Act for five years. On September 16, 2020, the bill
was unanimously reported to the House.
Microloan Program
On March 7, 2019, the Subcommittee on Economic Growth, Tax,
and Capital Access held a hearing to review SBA's Microloan
program. During the hearing, Subcommittee Members heard from
Microlenders, Microloan borrowers, and program stakeholders
regarding current program operations and recommendations to
improve the program's performance and reach. For example,
Microlenders on the panel testified that eliminating the
program's ``1/55 rule'' (which places an arbitrary cap on the
distribution of loan funds to Intermediaries for the first half
of the year to the lesser of $800,000 or one-fifty-fifth of
newly appropriated funds) would allow SBA to more efficiently
get loan funds to Intermediaries when needed. Microlenders also
testified about the importance of technical assistance and
encouraged Congress to strengthen that component of the
program. On March 11, 2020, the Committee marked up two bills
to improve the Microloan program, both of which were reported
unanimously to the House, and approved on September 14, 2020.
SBIC Program
In the 116th Congress, oversight of the Capital Access
programs was a top priority. With regard to the Small Business
Investment Company (SBIC) program, the Committee held a SBIC
management review hearing on September 26, 2019. The Associate
Administrator (AA) for the Office of Investment and Innovation
(OII), Joseph Shepard testified on the first panel, providing
Committee Members with an update of program performance under
his leadership. The second panel was comprised of SBIC industry
participants, stakeholders, and policy experts who testified on
the performance of the program, including the impact the
programmatic delays had on investors' ability to assist small
businesses. Witnesses raised concerns over delays in SBIC fund
licensing for new and existing SBIC funds, as well as delays in
conducting periodic examinations. On October 10, 2019,
Chairwoman Nydia M. Velazquez and Ranking Member Steve Chabot
sent a letter to Mr. Shepard outlining concerns from the
September 26th hearing, specifically with regard to SBA's
staffing for SBIC fund licensing and generally within OII. On
October 18, 2019, the Chairwoman and Ranking Member received a
response from SBA to the October 10th letter. SBA's response
addressed many of the questions raised regarding SBIC fund
licensing and staffing levels at OII.
PANDEMIC-SPECIFIC ACCESS TO CAPITAL PROGRAMS
Paycheck Protection Program
In response to the COVID-19 pandemic, Congress created the
SBA Paycheck Protection Program (PPP), which has been
implemented with the assistance of the Department of Treasury.
The program is designed to help small employers access critical
financial assistance quickly. The Committee held numerous
oversight hearings on the PPP to assess the effectiveness of
the program and evaluate ways to improve the program's reach
and performance, particularly to women, minorities, and
underserved communities. This included a hearing held on July
17, 2020 with Treasury Secretary Steven Mnuchin and SBA
Administrator Jovita Carranza regarding agency challenges with
the program. Specifically, Secretary Mnuchin committed to
setting aside some PPP funds for underserved small businesses.
The Committee also held a hearing on June 17, 2020 with PPP
participants and stakeholders to assess the effectiveness of
the program, as well as where ongoing improvements are needed.
Furthermore, the Committee held a hearing on September 25, 2020
specifically on PPP loan forgiveness and the challenges
borrowers and lenders faced in applying for forgiveness.
Specifically, Committee Members heard about the need lenders
and borrowers have for a streamlined PPP loan forgiveness
process, particularly for the smallest of small businesses.
The Subcommittee on Innovation and Workforce Development
also held a hearing on September 24, 2020 with SBA's Chief of
Staff and Associate Administrator for the Office of Capital
Access, William Manger, regarding the technology systems SBA
uses to operate its various business loan programs.
Subcommittee Members heard about the issues SBA faced in
rapidly processing PPP loans and the steps SBA is taking to
increase memory capacity and system resiliency as the loan
forgiveness process begins. The Committee has also maintained a
steadfast effort to improve PPP transparency and specifically,
public reporting of loan level data. This includes regular
correspondence with SBA and government watchdog agencies.
Economic Injury Disaster Loan Program
Responding to the COVID-19 pandemic, Congress also enacted
numerous changes to SBA's Economic Injury Disaster Loan (EIDL)
program to improve its ability to respond to the COVID-19
pandemic. The improvements included additional funding to meet
demand for EIDLs, a waiver of the credit elsewhere requirement,
and the creation of an EIDL Advance grant program, which
provided advance payments of up to $10,000 that would not need
to be repaid, even if borrowers were later denied disaster
loans. The Committee held multiple oversight hearings on the
EIDL program to evaluate its effectiveness and hear from
program participants regarding their experiences with the
program. This included a hearing on June 10, 2020 with EIDL
borrowers and Advance recipients, and a hearing with the
Associate Administrator for the Office of Disaster Assistance
(ODA) James Rivera on July 1, 2020 to hear the challenges ODA
faced in implementing an expanded EIDL program and in standing
up a new EIDL Advance program. This included a need to rapidly
increase staff to manage the unprecedented demand for EIDLs and
retain a contractor to assist with processing and evaluating
COVID-19 EIDLs.
On June 9, 2020, Chairwoman Nydia M. Velazquez and Ranking
Member Steve Chabot sent SBA Administrator Jovita Carranza a
letter expressing concerns over ODA's implementation of the
EIDL and Advance programs, including an agency-imposed cap on
EIDL amounts at $150,000, as well as concerns some EIDL
applicants shared with the Committee regarding SBA's customer
service. The June 9 letter also included 14 interrogatories
(including all discrete subparts) addressed to the agency.
Moreover, on July 31, 2020, Chairwoman Velazquez and
Subcommittee on Investigations, Oversight, and Regulations
Chairwoman Judy Chu sent Administrator Carranza a letter
requesting a briefing on SBA's response to the findings in the
Office of Inspector General's (OIG) report identifying
potential fraud in the EIDL program. The staff briefing was
held in early August 2020.
Subpart 2--Oversight of SBA and other Federal Entrepreneurial
Development Programs
GENERAL ENTREPRENEURIAL DEVELOPMENT PROGRAMS
The SBA offers a wide range of free or low-cost counseling
and training services through its entrepreneurial development
ecosystem to help entrepreneurs launch and grow their small
businesses. To deliver these resources, the SBA relies on its
four primary resource partners: Small Business Development
Centers (SBDCs), Women's Business Centers (WBCs), SCORE, and
Veterans Business Outreach Centers (VBOCs). During the 116th
Congress, the Committee focused its oversight efforts on
ensuring these programs were operating effectively in creating
jobs at startups and traditional firms, meeting the needs of
underserved populations, and using taxpayers' dollars
responsibly.
On February 27, 2019 the Committee held a hearing with
representatives from the SBDC, WBC, SCORE, and VBOC programs to
learn how these programs could be improved and strengthened
through reauthorization. Following the hearing, the Committee
worked with Representative Jared Golden on H.R. 4406, the
``Small Business Development Center Improvement Act'' to
reauthorize the SBDC program for four years, allow for the
promotion and advertisement of the program, and strengthen
oversight through an annual report to Congress. The Committee
also worked with Representative Sharice Davids on H.R. 4405,
the ``Women's Business Center Improvement Act'' to reauthorize
the WBC program for four years, create an accreditation program
for WBCs, and require annual reports to Congress. Lastly, the
Committee worked with Representative Bradley Schneider on H.R.
3537, the ``Veterans Entrepreneurship Act,'' to codify the
Boots to Business program at VBOC for 5 years. These bills were
marked up in committee and passed the House in the 116th
Congress but were not considered in the Senate.
On July 11, 2019 the Subcommittee on Investigations,
Oversight, and Regulations held a hearing to examine the SBA
Office of Inspector General's (OIG) April 25, 2019 report on
the SCORE Program. Mr. Hannibal Ware, the Inspector General of
SBA and Mr. Allen Gutierrez, Associate Administrator of the
Office of Entrepreneurial Development Associate testified
before the Committee. The report found that SBA did not
effectively oversee SCORE's use of federal funds and that SBA's
ability to detect fraud, waste, and abuse in the program was
hampered. As a result, the Committee worked with Representative
Kevin Hern on H.R. 4407, the ``SCORE for Small Business Act of
2019,'' that created safeguards for SCORE's use of government
funds and brought the program in line with Federal operating
standards. H.R. 4407 passed the House on October 21, 2019 but
was not considered in the Senate. Since the July 11th hearing,
SCORE has independently closed the recommendations from the OIG
report, changed leadership, and worked to restore public faith
in the organization.
A major priority of the Committee has been to investigate
and expand access to SBA's entrepreneurial development services
to underserved communities across the country. On April 30,
2019 the Subcommittee on Investigations, Oversight, and
Regulations held a hearing to discuss SBA's relationship with
HBCUs. Following the hearing, Chairwoman Velazquez,
Subcommittee Ranking Member Spano, Subcommittee Chairwoman Chu,
Alma Adams, and Vice-Chair Dwight Evans sent a letter to SBA's
Associate Administrator of Entrepreneurial Development, Allen
Gutierrez, inquiring how SBA plans to meet recommendations from
GAO's report (GAO-20-41), fulfill the promises from his April
30th testimony, and strengthen SBA's relationship with HBCUs.
Similarly, the Subcommittee on Investigations, Oversight,
and Regulations held a field hearing on November 8, 2019 to
determine how the federal government can better assist
immigrant entrepreneurs and small business owners. In addition,
the Committee held a hearing on October 23, 2019 on expanding
entrepreneurial development services to the incarcerated and
formerly incarcerated. This hearing led to the development and
passage of H.R. 5078, the ``Prison to Proprietorship Act,''
with Chairwoman Nydia Velazquez, and H.R. 5065, ``Prison to
Proprietorship for the Formerly Incarcerated Act'' with
Representative Hakeem Jeffries. These bills would provide
entrepreneurial development counseling and training to
individuals currently incarcerated and recently released from
prison. H.R. 5078 and H.R. 5065 were not considered by the
Senate.
PANDEMIC RELATED PROGRAMS
On January 30, 2020, The World Health Organization (WHO)
declared a global health emergency over COVID-19. In response
to the widespread disruption to public health, the economy, and
small businesses particularly, Congress created and passed the
CARES Act to respond to the effects of the pandemic. The CARES
Act was signed into law on March 27, 2020 and the Committee has
been actively engaged in oversight of its programs since
enactment. Specifically, the Committee has overseen the
implementation of the increased funding for SBA's SBDCs, WBCs,
their Associations, and Minority Business Development Centers
(MBDCs) and the implementation of SBA language services.
On May 7, 2020, the Committee held a virtual forum with
representatives from SBA's Resource Partners, the SBDCs, WBCs,
SCORE, VBOCs, and Treasury's MBDC program. The SBDCs and WBCs
received additional funding through the CARES Act to provide
virtual counseling and training services and to tailor their
curriculums to the challenges small businesses face during the
mandatory shutdowns and pandemic life. The forum provided an
opportunity for the Committee to perform oversight on the
disbursement of funds and SBA's engagement with the Resource
Partners to meet the challenges facing counselors and the
communities they serve across the nation.
On May 28, 2020, the Subcommittee on Contracting and
Infrastructure held a virtual forum on how Congress can
leverage the SBDC network to help small businesses recover from
the pandemic. At this forum, members learned of the vast array
of services SBDCs can provide small businesses and
entrepreneurs including services tailored to the COVID-19
pandemic. In addition, members learned of the importance of
SBDCs being able to use CARES Act funds to market their
services to reach as many small business owners and
entrepreneurs as possible.
In addition to virtual forums, the Subcommittee on
Investigations, Oversight, and Regulations Chairwoman Judy Chu
and Small Business Committee Chairwoman Nydia Velazquez led 72
Members in a letter to SBA Administrator Carranza regarding the
language services implementation as required in Section 1110 of
the CARES Act. The letter detailed the Committee's concerns
that SBA was slow to provide the necessary documents and
materials in the 10 most common languages other than English
including, Mandarin, Cantonese, Japanese, and Korean. The
Committee has not received a response but SBA has updated their
website with CARES Act program application forms, application
instructions, and FAQs in the required languages.
Subpart 3--Oversight of Federal Government Contracting
One of the core functions of SBA is to ensure that a fair
proportion of contracts and subcontracts are placed with small
businesses. To accomplish this mission, SBA has a wide range of
contracting programs and supporting resources that strive to
level the playing field and grant small businesses access to
the federal procurement space. During the 116th Congress, the
Small Business Committee focused its oversight activities on
ensuring these programs and resources are implemented in
accordance with the statute and free from fraud and abuse.
On March 26, 2019, the Committee held a hearing to examine
SBA's delay in carrying out the Small Business Runway Extension
Act (Runway Act) and possible measures to expedite its
implementation. Following the hearing, on April 4, 2019,
Congresswoman Nydia Velazquez, in conjunction with Ranking
Member Chabot, Representative Golden and Representative Stauber
sent a letter to SBA's Administrator, Linda McMahon, to request
information on the agency's progress and request a timeline for
issuing regulations to implement the legislation. The Committee
also worked with Representative Stauber on H.R. 2345, the
``Clarifying the Small Business Runway Extension Act,'' which
sought to ensure the swift implementation of the Runway Act.
H.R. 2345 passed the House on July 15, 2019. However, it was
not enacted into law as SBA ultimately adopted rules to address
the matter.
Similarly, on May 16, 2019, the Committee held a hearing to
discuss GAO's latest report regarding the Women Owned Small
Business (WOSB) Contracting Program and SBA's lack of
implementation of a formal WOSB certification, as required by
the National Defense Authorization Act for Fiscal Year 2015. On
June 19, 2019, the Committee sent a bipartisan letter to the
former Associate Administrator of the Office of Government
Contracting and Business Development, Mr. Wong, requesting
SBA's timelines and plans to implement the formal certification
process. Subsequent oversight efforts on this topic include a
management review hearing hosted by the Committee on September
15, 2020 where the new Associate Administrator for GCBD, Dr.
Spampinato, had an opportunity to testify as to the status of
the WOSB certification process, the current state of the 8(a)
and HUBZone programs and the overall participation of small
businesses in federal contracts and subcontracts.
Eradicating fraud and abuse has been a longstanding
oversight priority for the Committee. On October 22, 2019, the
Committee held a hearing focused on GAO's reports detailing
SBA's weaknesses in the management of the 8(a) program as it
relates to native-owned small business. The hearing also
addressed concerns of ineligible firms being certified into the
program. On January 24, 2020 the Committee sent a letter to GAO
requesting additional work in these areas and the report is
currently underway.
The Committee has also engaged in oversight efforts to
guarantee resources, such as contracting personnel, are
available to assist small businesses. On November 5, 2019, the
Committee sent a bipartisan letter to the Director of the
Defense Logistics Agency, Mr. Williams, to inquire about the
agency's non-compliance with requirements of the Office of
Small and Disadvantaged Business Utilization (OSDBU). Likewise,
on August 12, 2020, Chairwoman Velazquez sent a letter to SBA
referencing the findings of a recently published GAO report on
procurement center representatives (PCRs) and requesting
additional information as to the limited number of PCRs and
efforts to fill available positions or to increase them.
Finally, the Committee has performed its oversight function
through legislation. For example, H.R. 226 the ``Clarity on
Small Business Participation in Category Management Act of
2019'' institutes a reporting requirement to understand the
level of participation of small businesses in ``Best In Class''
contracting vehicles, which in turn will help measure the
impact of category management on small businesses and federal
procurement opportunities. H.R. 226 became law on December 20,
2019, through its incorporation in S. 1790, the National
Defense Authorization Act of 2019. Furthermore, given the
importance of cash flow to small businesses particularly amid
the COVID-19 pandemic, the Committee worked with Representative
Crow on H.R. 7342, the ``Federal Small Businesses Contractor
Prompt Payment Reporting Act.'' H.R. 7342 requires federal
agencies to report to Congress on the timeliness of payments to
prime contractors who are small businesses or have small
businesses as subcontractors, including the date in which
agencies started accelerating payments (with a goal of paying
in 15 days after the submission of a proper invoice) in
accordance with 10 U.S.C. 2307(a)(2) and 31 U.S.C. 3903(a)(10)-
(11). H.R. 7342 was introduced on June 25, 2020 and included in
H.R. 6395, the ``William M. Mac Thornberry National
Authorization Defense Act for Fiscal Year 2021.'' H.R. 6395
passed the House on July 21, 2020 by a vote of 295-125 (Roll
Call 152) and placed on the Senate Legislative Calendar on
August 5, 2020.
Subpart 4--Oversight of SBA Management
The Committee actively oversees the management of the Small
Business Administration through hearings, letters, and meetings
with agency officials and industry representatives.
A primary concern for the Committee is to ensure that
adequate levels of funding are available to fully implement SBA
programs. The Small Business Administration assists small
businesses through business loans, loan guarantees, counseling,
and contracting preferences. To deliver these programs and
services throughout the country, SBA relies largely on a
network of 68 district offices located across the United States
and its territories. The Committee held a management review
hearing on the Office of Field Operations, in which Mr. Michael
A. Vallante, the Associate Administrator of the Office of Field
Operations, testified about the Office's organizational
structure and performance. Members learned the aggregate number
of Full Time Equivalents (FTE) employees in district and
regional offices decreased from 813 in FY 2014 to 687 in FY
2019. To ensure the agency meets its mission to serve small
businesses throughout the nation and deliver high quality
services to the small business community, the Committee
recommended that funding be dedicated to the Office of Field
Operations in ``the Views and Estimates of the Committee on
Small Business on Matters to be set forth in the Concurrent
Resolution on the Budget for Fiscal Year 2021.'' The letter was
approved in a full Committee mark-up on March 4, 2021.
The Committee also rejected the Administration's steep cuts
to SBA's resource partner network, comprised of Small Business
Development Centers (SBDCs), Women's Business Centers (WBC),
SCORE chapters, and Veterans Business Outreach Centers (VBOCs).
In the Views and Estimates letters for FY 2020 and FY 2021, the
Committee advocated for robust levels of funding for the
counseling and training programs to support small businesses.
Moreover, on February 26, 2020, the Committee held a hearing on
the Small Business Committee's Budget for FY 2021. The newly
confirmed Administrator, Jovita Carranza testified before the
Committee in which concerns were raised over the level of
funding for district offices, as well as the steep cuts to the
Entrepreneurial Development programs.
On October 11, 2019, the Inspector General released its
report on the most serious management and performance
challenges facing the Small Business Administration in fiscal
year 2020. On October the Committee held an oversight hearing
to examine the management and performance challenges identified
in the OIG's FY 2020 report and discuss SBA's efforts to
address these challenges.
The Committee has also been concerned the SBA has
implemented unproven pilot programs that lack an authorization
and robust controls. To that end, on September 19, 2019, the
Subcommittee on Innovation and Workforce Development held a
hearing to evaluate the Growth Accelerator Fund Competition
(GAFC), a pilot program that provides $50,000 awards to
accelerators to give early-stage entrepreneurs opportunities to
immerse themselves in intense learning. At the hearing,
witnesses testified that SBA's GAFC spurred economic
development and helped to create jobs. Moreover, the pilot
program fills geographic gaps by supporting the development of
accelerators and their startups in regions of the country where
there are fewer sources of capital. On October 17, 2019, the
Committee reported H.R. 4387, legislation to establish a Growth
Accelerator Program at the Small Business Administration and
develop metrics to further evaluate the effectiveness of the
program. The legislation was approved by the House of
Representatives on October 21, 2019, however the Senate did not
consider the measure.
Throughout the Congress, the Committee also held a number
of management review hearings to evaluate budgetary requests,
financial management, and reporting goals in each of the
offices at SBA. The respective Associate Administrator from
each department testified before the Committee at these
hearings, which are detailed in Subparts A and B above.
Moreover, Committee staff met regularly with Associate
Administrators and other SBA employees to conduct oversight.
Subpart 5--Oversight of Federal Regulatory and Paperwork Burdens
The Committee continues to prioritize oversight of federal
agency regulations and paperwork requirements to ensure small
businesses are not unduly burdened. On July 21, 2019, the
Subcommittee on Economic Growth, Tax, and Capital Access held a
field hearing in Tulsa, Oklahoma to examine the small business
regulatory landscape and how it affects their ability to
operate their businesses. This hearing allowed Members to learn
of opportunities to reduce burdensome regulations and
paperwork, as well as, hear which regulations work for small
businesses and entrepreneurs.
Legislatively, the Committee worked with Representative
Antonio Delgado to advance H.R. 2142, which would require the
SBA and Agriculture Regulatory Enforcement Ombudsman
(Ombudsman) to create a centralized website for regulatory
compliance guides. H.R. 2142 would reduce the administrative
burden on small businesses by consolidating necessary
regulatory information in one place. In addition, H.R. 2142
requires the Ombudsman to report to Congress on federal
agencies' compliance with the Small Business Regulatory
Enforcement Fairness Act of 1996 (SBREFA). H.R. 2142 passed the
House on July 15, 2019 but was not considered in the Senate.
As part of its ongoing oversight efforts, the Committee
continued to monitor federal agencies compliance with the
SBREFA, which requires agencies to report to Congress annually
on small entity compliance guides that are required for every
final rule that has a significant impact on a substantial
number of small entities under the Regulatory Flexibility Act.
Subpart 6--Oversight of Federal Tax Policy
During the 116th Congress, the Committee conducted hearings
and investigations into the tax code and its impact on small
businesses. Specifically, the Committee conducted a hearing on
July 24, 2109 focused on how the Tax Cuts and Jobs Act (TCJA)
failed to deliver on its promises for most Main Street small
businesses. The Committee conducted a hearing on March 3rd,
2020 regarding the impact of the 2018 U.S. Supreme Court
decision in South Dakota v. Wayfair, Inc. regarding state sales
and use taxes and tax compliance. Following the Wayfair hearing
Representative Andy Kim--Chairman of the Economic Growth, Tax
and Capital Access subcommittee--sent a letter in October 2020
to the Government Accountability Office (GAO) requesting an
update on a 2017 report that estimated revenue and compliance
costs related to interstate sales and use taxes for states and
businesses. Additionally, the Committee held a hearing on March
27, 2019 examining retirement plan options for small businesses
and the barriers small business owners face in saving for
retirement. Finally, the Committee examined the impact of
COVID-19 on small businesses and tax policy via the
implementation of the Employee Retention Tax Credit (ERTC) and
the Paycheck Protection Program (PPP).
Subpart 7--Oversight of Health Care Policy
During the 116th Congress, the Committee on Small Business
conducted hearings and oversight analyzing federal health care
policy, focusing on small, physician-owned medical practices
and their ability to better service patients. That included a
hearing on June 12, 2019 covering how increasing student loan
debt is a barrier to entry for young doctors starting new
firms, especially in underserved areas of the country. The
Committee also held hearings on ways to reducing administrative
burdens for small medical practices. Following a hearing on
September 11, 2019 on prior authorization, a method used by
health insurance companies to slow down the ability for doctors
to serve their patients, members of the committee led letters
on the issue. The first was to Ways and Means October 21st,
2019, pushing for the passage of H.R. 3107, Improving Seniors'
timely Access to Care Act of 2019, and the second led by
Representative Davids on May 4, 2020 to CMS encouraging changes
to Medicare Advantage regulations in the midst of the COVID-19
pandemic. The Committee also conducted a hearing analyzing the
connections between public health and small businesses in its
first hearing on the COVID-19 pandemic, primarily focused on
industries such as travel and dining, especially in Asian-
American communities.
Subpart 8--Oversight of Energy Policy
During the 116th Congress, the Committee on the Small
Business conducted hearings and oversight detailing how small
businesses are involved in the clean energy economy, reducing
emissions, increasing efficiencies while creating jobs in the
United States. On September 6, 2019 the Committee held a
hearing on the diverse ways small businesses are engaged in the
growing the clean energy economy. This included the importance
of tax incentives for renewable energy, energy efficiency, and
clean transportation technologies and outlined the importance
that biofuels production has in rural America. The Committee
also provided input to the House Select Committee on the
Climate Crisis on ways that the Small Business Administration
can be supportive of small businesses seeking to adopt energy
efficiency and renewable energy systems. Representative
Finkenauer, the Chair of the Small Business Committee
Subcommittee on Rural Development, Agriculture, Trade, and
Entrepreneurship wrote a letter to the Administration on
biofuels issues and the renewable fuel standards on June 8,
2020. The letter pushed back against waivers provided by the
Administration that impacted the production and use of
renewable biofuels under the federal Renewable Fuel Standard.
Subpart 9--Oversight of Trade and Intellectual Property Policy
Trade
The State Trade Expansion Program (STEP) aims to increase
the number of small businesses that export and raise the value
of existing small business exporters. The SBA Associate
Administer of the Office of International Trade is responsible
for overseeing the program and awards matching funds to states
and territories for participation in trade missions,
international marketing efforts, workshops, export trade show
exhibits, and other promotional activities.
In the 116th Congress, the Committee worked to ensure the
STEP program meets the needs of its participants and expands
access to export markets across the country, in preparation for
the reauthorization of the program. On March 12, 2019, the
Subcommittee on Rural Development, Agriculture, Trade, and
Entrepreneurship held a hearing with the Government
Accountability Office (GAO) and SBA Office of Inspector General
(OIG) to discuss the challenges facing the STEP program. In
addition, on June 11, 2019, the Subcommittee held a hearing on
the states' perspectives of the STEP program, where they heard
from state representatives and small business participants.
These hearings allowed Subcommittee members to understand the
challenges facing the program from multiple perspectives.
This oversight work culminated in the Committee working
with Representative Abby Finkenauer on H.R. 6133, the STEP
Improvement Act. H.R. 6133 would reauthorize the program
through Fiscal Year 2024, streamline the application process,
increase grant flexibility, and improve the communication
between the SBA and state awardees. H.R. 6133 was passed by the
House on September 14, 2020 but not considered in the Senate.
In addition to the STEP program, the Committee also held a
roundtable on February 12, 2020 with representatives from SBA's
SBDC program. One of the panels of the roundtable focused on
how the Committee can continue to prioritize small business
exports and how imperative they are to small business growth.
Intellectual Property
During the 116th Congress, the Committee on Small Business
conducted hearings and oversight facing entrepreneurs, start-
ups, and small businesses regarding patents, trademarks, and
copyrights. On January 19, 2020, the Committee held a hearing
on the Inventor Diversity for Economic Advancement (IDEA) Act
which would require the Patent Trade Office (PTO) to collect
demographic data, reflecting the data categories collected in
the SUCCESS Act from patent applicants on a voluntary basis.
The Committee heard testimony that lack of diversity in the
innovation process is hindering the economy and one way to
combat this is to collect demographic data to create more
understanding and equity in the in the innovation ecosystem.
The Committee also held a roundtable on July 25, 2019
regarding issues that women entrepreneurs face in the
technology industry. Members of the Committee heard about ways
to integrate more women into venture capital (VC) and
developing resources to create pipeline of future female tech
founders.
Subpart 10--Oversight of Agriculture
During the 116th Congress, the Committee on Small Business
conducted hearings and oversight on the important role small
businesses play in the agriculture sector of the economy. Small
businesses are engaged in a wide range of farm and food related
activities as producers, distributors, and retailers
domestically and in the international market. The Small
Business Committee conducted a hearing on opportunities
provided by advances in agricultural technology in rural
economies on January 9, 2020. The Committee heard the concerns,
challenges, and ways to supporting the next generation of
farmers at a hearing on July 25, 2019. The Committee also held
hearing on Sept. 30, 2020 analyzing how COVID-19 is impacting
our nation's farmers and small businesses engaged in our food
systems.
The Committee also held a hearing on November 14, 2019 with
officials from both USDA and SBA to discuss the memorandum of
understanding between the agencies, the challenges facing rural
businesses, and how the agencies can coordinate to best serve
rural entrepreneurs and small businesses. In addition to these
impactful hearings, the Small Business Committee analyzed trade
policies by the Trump Administration and its impact on small
farm businesses.
Chairwoman Nydia Velazquez (NY-07) and members of the
Committee sent a letter to the Administration on the impacts
that trade wars and tariffs were having on small businesses on
January 17, 2020. Congresswoman Abby Finkenauer (IA-01), joined
by other members of the Committee, wrote letters to the SBA
Administrator about the Office of Rural Affairs on December 13,
2019 and April 30, 2020. Congressman Antonio Delgado (NY-19)
and other members of the Committee engaged with the
Administration on small agriculture businesses access to COVID-
19 relief programs, sending a letter on April 2, 2020.
Subpart 11--Oversight of Technology and Innovation Policy
During the 116th Congress, the Committee on Small Business
conducted hearings and oversight facing entrepreneurs on the
importance of innovation, entrepreneurship, and how small
businesses are utilizing digital platforms to start and grow
businesses. The Committee held a hearing with representatives
from the ``Big Tech'' companies on November 14, 2019 regarding
the opportunities and challenges online platforms such as
Amazon and Google pose for entrepreneurs and small firms. The
Committee also held several hearings on the importance of
reliable and affordable broadband service is to the success of
small businesses, especially in rural and underserved markets.
One issue in particular addressed by the Committee, at a
hearing on June 25, 2019, was on the importance of accurate
broadband maps in closing the digital divide.
The Committee also addressed how lack of access to
broadband is impacting health care in rural communities during
COVID-19. Representative Crow led a letter on May 6, 2020 to
the Federal Communications FCC inquiring about how the FCC was
operating its COVID-19 Telehealth Portal which allows
healthcare providers to apply for reimbursements for costs they
incur for telehealth services.
During the 116th Congress, the Committee conducted
oversight on SBA's efforts to modernize its legacy technology
systems. The Committee learned that several projects the SBA
started were not completed, most importantly, Certify.gov. The
Committee also examined the systems used to implement the
Paycheck Protection Program and Economic Injury Disaster Loan
programs, focusing on system crashes, SBA's reliance on
outdated systems, and SBA's plans to replace these systems.
To that end, the Committee held two hearings, the first was
held on July 22, 2020 with SBA's Deputy CIO, Mr. Guy Cavallo,
focused on IT modernization efforts at the SBA over the past
few years. The second hearing was held on September 24, 2020
with SBA's Chief of Staff and Associate Administrator for the
Office of Capital Access, Mr. Bill Manger, which focused on the
technical concerns that arose during the PPP and EIDL programs.
On September 16, 2020 Representative Jared Golden, Chair of the
Subcommittee on Contracting and Infrastructure also sent a
letter to SBA regarding the Certify.gov project: the questions
centered on the cost of the project, why it was halted, and a
timeline for the completion of the new Certify.gov system.
Subpart 12--Oversight of Veterans' Entrepreneurship Policy
The Committee continues to oversee and foster veteran
entrepreneurship through contracting, entrepreneurial
development, and loan guaranty programs that assist service
members transitioning to civilian life. On July 10, 2019, the
Committee held a hearing titled: ``Continuing to Serve:
Military to Entrepreneurship,'' which focused on the role of
veteran entrepreneurs in growing the economy and examined
legislative efforts to foster veteran entrepreneurship.
Following the hearing, on July 17, 2019, the Committee marked
up four bills aimed to strengthen SBA's veteran programs.
Entrepreneurial Development
Every year, more than 200,000 servicemembers make the
transition from military to civilian life. Transition
assistance is critical to ensure that those who serve in the
military have opportunities for meaningful employment. The
National Defense Authorization Act of Fiscal Year 2019 requires
servicemembers participating in TAP to enroll in one of three
capstone classes, which include: Accessing Higher Education,
Career and Technical Training, and Entrepreneurship (Boots to
Business). In order to continue to support veteran
entrepreneurs, the Committee worked with Representative Bradley
Schneider on H.R. 3537, the ``Veteran Entrepreneurship Training
Act of 2019''. H.R. 3537 amends the Small Business Act to
codify the Boots to Business program for five years.
In addition, the Committee worked with Representative
Sharice Davids on H.R. 3734, ``The Successful Entrepreneurship
for Reservists and Veterans Act''. H.R. 3734 requires the
Interagency Task Force for Small Business Development to
annually report to Congress on the task force appointments and
to identify and outline a plan for outreach and promotion of
veterans' programs at SBA. H.R. 3734 also requires a GAO report
to Congress on the credit issues related to veterans, ensuring
Congress is apprised of issues facing the veteran community on
a regular basis.
These bills were marked up on July 17, 2019 by the
Committee and passed the House in the 116th Congress but were
not considered in the Senate.
Federal Contracting
In the 116th Congress, the Committee also focused its
efforts on harmonizing and ensuring consistency between two
distinct federal contracting programs for veterans. The
Committee worked with Representative Trent Kelly on H.R. 1615,
the ``Verification Alignment and Service-Disabled Business
Adjustment Act.'' H.R. 1615, institutes a formal certification
process for SBA's Service-Disabled Veteran-Owned Small Business
Contracting Program and transfers to the SBA the responsibility
of certifying veteran-owned small businesses participating in
the Department of Veterans Affairs contracting program.
In addition, the Committee worked with Ranking Member
Chabot on H.R. 499, the ``Service-Disabled Veterans Small
Business Continuation Act''. H.R. 499 provides parity in the
treatment of surviving spouses to these two contracting
programs.
H.R. 1615, as amended, was marked up in Committee, passed
the House, and was included in H.R. 6395, the National Defense
Authorization Act for Fiscal Year 2021. H.R. 6395 passed the
House but was not considered in the Senate. Similarly, H.R. 499
was marked up in Committee and passed the House in the 116th
Congress but was not considered in the Senate.
Access to Capital
Access to capital remains a significant barrier to veteran
entrepreneurship and an oversight priority of the Committee. On
February 7, 2019, the Subcommittee on Economic Growth, Tax, and
Capital Access held a hearing to assess the challenges faced by
underserved businesses, including those owned by veterans.
During that hearing, Subcommittee Members heard about a change
in the language of the Small Business Act that would increase
the eligibility of military--focused SBA programs to those who
have ``[been] ordered to perform active--duty service for more
than 30 consecutive days,'' which would include National Guard
and Reserve members.
Following the hearing, the Committee worked with
Representative Andy Kim on H.R. 3661, the ``Patriotic Employer
Protection Act''. H.R. 3661 makes the aforementioned change to
SBA's Military Reservist Economic Injury Disaster Loan (MREIDL)
and Repayment Deferral programs, broadening the pool of
servicemembers and reservists eligible for the MREIDL and
Repayment Deferral programs. H.R. 3661 was marked up in
Committee and passed the House in the 116th Congress but was
not considered in the Senate.
Subpart 13--Oversight of Labor and Workforce Policy
During the 116th Congress, the Committee on Small Business
conducted hearings and oversight to analyze the workforce needs
of small businesses often through the lens of workforce
development programs. On September 11, 2019 the Committee held
a hearing analyzing policies that can upskill the medical
services sector. The Committee also examined the importance of
local workforce boards under the Workforce Innovation and
Opportunity Act and Community Colleges for workforce training
in the recovery from the COVID-19 pandemic. The Committee also
conducted a field hearing in Colorado on November 22, 2019 on
innovations in the education system that are creating a
pipeline of highly skilled workers for small businesses using
new training methods for high school and college students.
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