FEDERALhearing transcript

Congressional Review of the Small Business Investment Company (SBIC) Program

Original title: SBA MANAGEMENT REVIEW: SMALL BUSINESS INVESTMENT COMPANY PROGRAM

January 1, 2019

Small Business Administration Small Business Investment Company Program Venture Capital Small Business Finance Congressional Oversight

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The Frame

What this does

The program facilitates billions of dollars in financing for small businesses, and this hearing serves as oversight to ensure the program effectively bridges the gap between availability and the needs of early-stage companies.

Who is mentioned in the record

Potentially affected actors named in the source documents. Mention is not a position.

Small Businesses

Small businesses are the primary recipients of financing provided through the SBIC program.

Banks and Federal Savings Associations

Under H.R. 116, these institutions are permitted to invest up to 15% of their holdings into SBICs.

SBIC Fund Managers

Fund managers maintain autonomy and flexibility to choose investment sectors for SBIC capital.

What changed

Last recorded activity January 1, 2019.

What's next

Next step not available in the current record.

Summary

The House Committee on Small Business held a hearing on September 26, 2019, to review the management and effectiveness of the Small Business Investment Company () program. The committee discussed the program's role in providing capital to startups and high-growth small businesses and reviewed legislative efforts to increase bank investment in the program.

Key Facts

The SBIC program was established in 1958 to provide affordable capital to small businesses and startups.
In fiscal year 2018, the SBA guaranteed $2.5 billion in SBIC investments.
In fiscal year 2018, SBICs invested $3 billion in private capital, totaling $5.5 billion in financing.
A total of 1,151 small businesses received financing through the SBIC program in fiscal year 2018.
The House passed H.R. 116, which allows banks and Federal savings associations to invest up to 15% of their holdings into SBICs.
The program is designed to fill the gap between venture capital availability and the needs of high-growth potential small businesses.
SBIC fund managers have autonomy to invest in various business sectors, including technology and apparel.

Frequently Asked Questions

What is the SBIC program?

The Small Business Investment Company () program is an SBA-backed initiative that partners private and public investments to provide capital to early-stage and high-growth small businesses.

How much money did the SBIC program provide to small businesses in 2018?

In fiscal year 2018, the program provided a total of $5.5 billion in financing to 1,151 small businesses.

What is the purpose of H.R. 116?

H.R. 116 aims to strengthen the program by allowing banks and Federal savings associations to invest up to 15% of their holdings into SBICs.

Why It Matters

News Coverage

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Discoveries

Patterns POLISCOPE noticed across the record. These are observations to investigate, not conclusions.

policy shift100% confidence

Expansion of Bank Investment

The committee highlighted a legislative push (H.R. 116) to increase the amount of capital banks can contribute to the SBIC program to 15% of their holdings.

H.R. 116

Connected Entities

personJoseph Shepard“Associate Administrator, Office of Investment and Innovation, SBA”Map →

organizationSmall Business Administration“Federal agency overseeing the SBIC program”Map →

personNydia Velazquez“Chairwoman of the House Committee on Small Business”Map →

personSteve Chabot“Ranking Member of the House Committee on Small Business”Map →

Sources

Open source document

www.govinfo.gov

Analysis Score

0–100

Significance65
How much this matters to a regular citizen
Controversy15
Intensity of disagreement among stakeholders
Entertainment10
Compellingness for a non-policy-wonk reader
Buzz20
Current news / social attention level

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