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S. 2521: SBIC Advisory Committee Act of 2022


The text of the bill below is as of Sep 28, 2022 (Passed the Senate).


117th CONGRESS

2d Session

S. 2521

IN THE SENATE OF THE UNITED STATES

AN ACT

To require the Administrator of the Small Business Administration to establish an SBIC Advisory Committee, and for other purposes.

1.

Short title

This Act may be cited as the SBIC Advisory Committee Act of 2022.

2.

SBIC Advisory Committee

(a)

Definitions

In this section—

(1)

the terms Administration and Administrator mean the Small Business Administration and the Administrator thereof, respectively;

(2)

the term covered Members means the Chair and Ranking Member of—

(A)

the Committee on Small Business and Entrepreneurship of the Senate; and

(B)

the Committee on Small Business of the House of Representatives;

(3)

the terms licensee, small business investment company, and underlicensed State have the meanings given those terms in section 301 of the Small Business Investment Act of 1958 (15 U.S.C. 662);

(4)

the term low-income community has the meaning given the term in section 45D(e) of the Internal Revenue Code of 1986;

(5)

the term rural area has the meaning given the term by the Bureau of the Census;

(6)

the terms small business concern, small business concern owned and controlled by veterans, and small business concern owned and controlled by women have the meanings given those terms in section 3 of the Small Business Act (15 U.S.C. 632);

(7)

the term socially or economically disadvantaged individual means a socially disadvantaged individual or economically disadvantaged individual, as described in paragraphs (5) and (6)(A), respectively, of section 8(a) of the Small Business Act (15 U.S.C. 637(a));

(8)

the term underfinanced State means a State that has below median financing, as determined by the Administrator; and

(9)

the term underserved community means—

(A)

a HUBZone, as defined in section 31(b) of the Small Business Act (15 U.S.C. 657a(b));

(B)

a community that has been designated as an empowerment zone or an enterprise community under section 1391 of the Internal Revenue Code of 1986;

(C)

a community that has been designated as a promise zone by the Secretary of Housing and Urban Development; and

(D)

a community that has been designated as a qualified opportunity zone under section 1400Z–1 of the Internal Revenue Code of 1986.

(b)

Establishment

The Administrator shall establish an SBIC Advisory Committee (referred to in this section as the Advisory Committee) to convene outside experts to advise on the small business investment program under title III of the Small Business Investment Act of 1958 (15 U.S.C. 681 et seq.).

(c)

Composition

(1)

Membership

The Advisory Committee shall be composed of 16 members appointed by the Administrator as follows:

(A)

The Associate Administrator of the Office of Investment and Innovation of the Small Business Administration, or another designee of the Administrator as determined by the Administrator.

(B)

7 members with competence, interest, or knowledge of the small business investment program under title III of the Small Business Investment Act of 1958 (15 U.S.C. 681 et seq.), of whom—

(i)

not fewer than 3 shall have a demonstrated record of expertise in investing in—

(I)

low-income communities;

(II)

communities that have been designated as qualified opportunity zones under section 1400Z–1 of the Internal Revenue Code of 1986;

(III)

businesses primarily engaged in research and development;

(IV)

manufacturers;

(V)

businesses primarily owned or controlled by individuals in underserved communities before receiving capital from the licensee;

(VI)

rural areas; or

(VII)

underfinanced States; and

(ii)

not fewer than 1 member shall be a representative from a trade association for the small business investment program under title III of the Small Business Investment Act of 1958 (15 U.S.C. 681 et seq.).

(C)

8 members appointed by the Administrator as follows:

(i)

2 members shall be selected from among the individuals in the list submitted by the Chair of the Committee on Small Business and Entrepreneurship of the Senate under paragraph (2).

(ii)

2 members shall be selected from among the individuals in the list submitted by the Ranking Member of the Committee on Small Business and Entrepreneurship of the Senate under paragraph (2).

(iii)

2 members shall be selected from among the individuals in the list submitted by the Chair of the Committee on Small Business of the House of Representatives under paragraph (2).

(iv)

2 members shall be selected from among the individuals in the list submitted by the Ranking Member of the Committee on Small Business of the House of Representatives under paragraph (2).

(2)

Recommendations

Not later than 30 days after the date of enactment of this Act, each of the covered Members shall provide to the Administrator a list of 3 candidates for membership on the Advisory Committee, who shall be individuals who hold a high-ranking position or senior leadership role, and have no conflict of interest in the small business investment program under title III of the Small Business Investment Act of 1958 (15 U.S.C. 681 et seq.), in—

(A)

a relevant industry trade association;

(B)

the investment industry with expertise in pensions, endowments, and other non-banking institutions;

(C)

academia with expertise in the investment industry; or

(D)

a nonprofit institution, including one that serves any of the entities described in subclauses (I) through (VII) of paragraph (1)(B)(i).

(3)

Private sector members

Not fewer than 2 and not more than 4 of the members of the Advisory Committee shall be investors in the private sector who—

(A)

invest in small business concerns; and

(B)

as of the date of appointment, do not participate in the small business investment program under title III of the Small Business Investment Act of 1958 (15 U.S.C. 681 et seq.).

(4)

Chairperson

The Chairperson of the Advisory Committee shall be the member of the Advisory Committee appointed under paragraph (1)(A).

(5)

Period of appointment

Members of the Advisory Committee shall be appointed for the life of the Advisory Committee.

(6)

Vacancies

Any vacancy in the Advisory Committee shall be filled in the same manner as the original appointment.

(d)

Deadline for appointment

Not later than 60 days after the date on which the covered Members provide the lists to the Administrator under subsection (c)(2), the Administrator shall—

(1)

appoint the members of the Advisory Committee; and

(2)

submit to Congress a list of the members so appointed.

(e)

Duties

The Advisory Committee shall provide advice and recommendations to the Administrator—

(1)

concerning policy and program development and other matters of significance concerning activities under the Small Business Act (15 U.S.C. 631 et seq.) and the Small Business Investment Act of 1958 (15 U.S.C. 661 et seq.), including diversifying management teams or companies;

(2)

concerning incentives for small business investment companies to—

(A)

invest and locate in underlicensed States and underfinanced States; and

(B)

invest in small business concerns, including those owned and controlled by socially or economically disadvantaged individuals, small business concerns owned and controlled by veterans, and small business concerns owned and controlled by women;

(3)

concerning metrics of success, and benchmarks for success, with respect to the goals described in this section; and

(4)

concerning the impact of the small business investment program under title III of the Small Business Investment Act of 1958 (15 U.S.C. 681 et seq.) on the private investment market, including whether investments under the program compete with the private sector.

(f)

Report

Not later than 18 months after the date on which the Administrator establishes the Advisory Committee under subsection (b), the Advisory Committee shall submit to the Administrator, the Committee on Small Business and Entrepreneurship of the Senate, and the Committee on Small Business of the House of Representatives a report that includes the recommendations of the Advisory Committee described in subsection (e).

(g)

Termination

The Advisory Committee shall terminate on the date on which the Advisory Committee submits the report required under subsection (f).

Passed the Senate September 28, 2022.

Secretary