59–010 

Calendar No. 105 

114TH CONGRESS REPORT " ! SENATE 2d Session 114–240 

VETERANS ENTREPRENEURSHIP ACT 

APRIL 21, 2016.—Ordered to be printed 

Mr. VITTER, from the Committee on Small Business and 

Entrepreneurship, submitted the following 

R E P O R T 

[To accompany S. 957] 

The Committee on Small Business and Entrepreneurship, to 

which was referred the bill (S. 957) to increase access to capital for 

veteran entrepreneurs to help create jobs, having considered the 

same, reports favorably thereon without amendment and recommends that the bill do pass. 

I. INTRODUCTION 

The Veterans Entrepreneurship Act (S. 957) was introduced by 

Senator Jeanne Shaheen on April 15, 2015. Senator Shaheen was 

joined by Senators Angus King and Maria Cantwell in introducing 

the bill. The bill is also co-cosponsored by Committee members 

Senator Kelly Ayotte, Senator Deb Fischer, Senator Mazie Hirono, 

Senator Christopher Coons and Senator Gary Peters, as well as 

Senator Michael Bennet. 

The Veterans Entrepreneurship Act amends the Small Business 

Act of 1953 to prohibit the administrator of the Small Business Administration (SBA) from assessing a guarantee fee in connection 

with a loan made under the SBA Express Program to a veteran or 

spouse of a veteran beginning October 1, 2015. The bill also directs 

the Administrator to report to Congress on: (1) the feasibility of 

providing financial planning and counseling to owners of small 

business concerns who are members of a reserve component prior 

to deployment; (2) the level of outreach to and consultation with female veterans by women’s business centers and veterans business 

outreach centers; and (3) the Military Reservists Economic Injury 

Disaster Loan Program, which shall include a discussion of SBA 

outreach efforts to increase participation, the number of loans 


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1SBA Veterans Assistance Programs: An Analysis of Contemporary Issues. Congressional Research Service, Dilger, Robert Jay and Lowry, Sean. R42695. March 10, 2016. 

made, and an analysis of the effectiveness of, and recommendations 

for improving, the Program. 

During the markup of the bill, the bill was approved unanimously by voice vote. 

II. HISTORY (PURPOSE & NEED FOR LEGISLATION) 

According to the Congressional Research Service (CRS), veteran 

unemployment as of February 2016 stood at 4.1 percent, lower 

than for nonveterans who are 18 or above, which stood at 5.1 percent.1 Unemployment amongst veterans who have left the armed 

forces since late 2001 is 4.7 percent, higher than the above-referenced figure of 4.1 percent for all veterans. Given the high number of veterans returning from overseas service over the last decade, Congress has shown substantial interest in assisting those 

veterans as they look to re-enter civilian life. While Congress’s engagement spans a broad range of veterans’ assistance, this Committee has been focused on removing barriers for veterans interested in building and expanding small businesses. Congress has 

worked closely with the Small Business Administration to establish, fund and conduct oversight of a number of SBA programs that 

support veterans engaged in small business ventures. One of those 

programs is SBA Express, which makes loans of up to $350,000 

available to borrowers, and features an expedited timeline for SBA 

review of applications. In recent years, Congress has heard from a 

variety of stakeholders about impediments faced by veterans seeking access to SBA programs. On January 1, 2014, SBA announced 

a simplified, streamlined application process for loans under the 

7(a) program of less than $350,000. One of those barriers is the requirement that borrowers under the 7(a) program pay upfront fees 

to receive a loan. That requirement has repeatedly been identified 

by applicants and veterans advocates as an obstacle for veterans 

who desire to start a small business. SBA has used its authority 

to waive these fees, as a component of the agency’s efforts to expand veterans’ access to federal assistance for starting and operating a small business, but Congress and stakeholders have continued efforts to make the fee waivers permanent. 

During the 113th Congress, S. 2143, the Veterans Entrepreneurship Act, would have authorized and made the Veterans Advantage 

Program’s fee waiver permanent. P.L. 113–235, the Consolidated 

and Further Continuing Appropriations Act, 2015, provided statutory authorization for the fee waiver for FY2015. 

During the 114th Congress, P.L. 114–38, the Veterans Entrepreneurship Act of 2015, authorized and made the SBA’s current practice of waiving the SBAExpress loan program’s one time, up-front 

guaranty fee for veterans (and their spouse) permanent beginning 

on or after October 1, 2015, except during any upcoming fiscal year 

for which the President’s budget, submitted to Congress, includes 

a cost for the 7(a) program, in its entirety, that is above zero.74

III. HEARINGS & ROUNDTABLES 

In the 113th Congress: 


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On June 4, 2014, the Committee held a hearing entitled ‘‘From 

Military Service to Small Business Owner: Supporting America’s 

Veteran Entrepreneurs,’’ chaired by Senator Cantwell, to discuss 

legislative proposals under consideration by the Committee in support of veterans entrepreneurship and small business ownership. 

During the hearing, witnesses discussed the obstacles facing 

transitioning service members, veterans and their spouses in starting and growing a small business. This included testimony as to 

the fees associated with certain SBA loan products and the need 

for additional access to capital. Specifically, witnesses expressed 

support for Senator Shaheen’s Veterans Entrepreneurship Act (S. 

2143), which would have permanently waived the fees on certain 

SBA loan products for service members, veterans, or their spouse. 

IV. DESCRIPTION OF BILL 

Amends the Small Business Act to prohibit the Administrator of 

the Small Business Administration (SBA) from assessing a guarantee fee in connection with a loan made under the SBA Express 

Program to a veteran or spouse of a veteran on or after October 

1, 2015. 

Directs the Administrator to report to Congress on: (1) the feasibility of providing financial planning and counseling to owners of 

small business concerns who are members of a reserve component 

prior to deployment; (2) the level of outreach to and consultation 

with female veterans by women’s business centers and veterans 

business outreach centers; and (3) the Military Reservists Economic 

Injury Disaster Loan Program, which shall include a discussion of 

SBA outreach efforts to increase participation, the number of loans 

made, and an analysis of the effectiveness of, and recommendations 

for improving, the Program. 

V. COMMITTEE VOTE 

In compliance with rule XXVI (7)(b) of the Standing Rules of the 

Senate, the following vote was recorded on April 23, 2015. 

A motion to adopt the Veterans Entrepreneurship Act, a bill to 

increase access to capital for veteran entrepreneurs to help create 

jobs, was approved unanimously by voice vote with the following 

Senators present: Senators Vitter, Risch, Fischer, Gardner, Ernst, 

Ayotte, Enzi, Shaheen, Cantwell, Cardin, Heitkamp, Booker, 

Coons, Hirono, and Peters. 

VI. COST ESTIMATE 

In compliance with rule XXVI (11)(a)(1) of the Standing Rules of 

the Senate, the Committee estimates the cost of the legislation will 

be equal to the amounts discussed in the following letter from the 

Congressional Budget Office: 


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U.S. CONGRESS, CONGRESSIONAL BUDGET OFFICE, Washington, DC, May 28, 2015. 

Hon. DAVID VITTER, 

Chairman, Committee on Small Business and Entrepreneurship, 

U.S. Senate, Washington, DC. 

DEAR MR. CHAIRMAN: The Congressional Budget Office has prepared the enclosed cost estimate for S. 957, the Veterans Entrepreneurship Act. 

If you wish further details on this estimate, we will be pleased 

to provide them. The CBO staff contact is Kim Cawley. 

Sincerely, 

KEITH HALL. 

Enclosure. 

S. 957—Veterans Entrepreneurship Act 

Under current law, the Small Business Administration (SBA) 

waives payment of a guarantee fee for certain loans made under 

the agency’s 7(a) loan guarantee program to veterans, military reservists, and their spouses that operate small businesses. S. 957 

would make this pilot program permanent. The bill also would direct the agency to provide three reports to the Congress on matters 

related to the SBA’s services to veterans and military reservists. 

In fiscal year 2015, the subsidy cost for the SBA’s 7(a) program, 

that is, the estimated long-term cost to the government for loan 

guarantees calculated on a net-present-value basis, is zero. Based 

on information from the SBA, CBO expects that extending the program to waive fees for certain 7(a) loans to veterans would not affect the program’s subsidy cost because the agency has discretion 

to adjust other fees authorized under the program to maintain an 

overall subsidy rate for the program of zero. CBO estimates that 

implementing S. 957 would have an insignificant effect on discretionary costs to meet the reporting requirements under the bill. Enacting S. 957 would not affect direct spending or revenues; therefore, pay-as-you-go procedures do not apply. 

S. 957 contains no intergovernmental or private-sector mandates 

as defined in the Unfunded Mandates Reform Act and would not 

affect the budgets of state, local, or tribal governments. 

The CBO staff contact for this estimate is Kim Cawley. The estimate was approved by Theresa Gullo, Assistant Director for Budget 

Analysis. 

VII. EVALUATION OF REGULATORY IMPACT 

In compliance with rule XXVI (11)(b) of the Standing Rules of the 

Senate, it is the opinion of the Committee that no significant additional regulatory impact will be incurred in carrying out the provisions of this legislation. There will be no additional impact on the 

personal privacy of companies or individuals who utilize the services provided. 

VIII. SECTION-BY-SECTION ANALYSIS 

Sec. 1. Short title—Creates a short title, the Veterans Entrepreneurship Act. 

Sec. 2. Definitions—Defines terms used throughout the bill. 


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Sec. 3. Permanent SBA Express Loan Guarantee Fee Waiver for 

Veterans—Congress codified a fee waiver for veteran owned small 

business for FY2015 as part of the FY15 Omnibus Appropriations 

Act, P.L. 113–235. The SBA Express loan program provides 

streamlined loan approvals for both banks and small businesses. 

The SBA is currently waiving fees for veteran-owned small businesses on Express loans between $150,000 and $350,000 for FY15 

(which are typically 3 percent of the loan). The Veterans Express 

Loan fee waiver builds on the SBA’s waiver of both borrower and 

lender fees on non-Express loans of $150,000 and less. 

The bill would make this fee waiver permanent, which will make 

it easier for veteran-owned businesses to get access to credit. SBA 

guarantee fees, which are calculated as a percentage of the loan 

based on maturity and loan value, typically cost borrowers thousands of dollars. Providing additional fee waivers for veteranowned small businesses is a simple and effective way of supporting 

veteran entrepreneurship. 

Sec. 4. Report on Financial Planning and Counseling for Owners 

of Small Business Concerns in the National Guard and Reserve— 

Requires SBA to study the feasibility of offering National Guard 

and Reservist small business owners financial planning and counseling prior to deployment. Pre-deployment training could potentially address many problems before they arise, which would save 

money for both the veteran and the tax payer. 

Sec. 5. Report on Accessibility and Outreach to Female Veterans 

by the Small Business Administration—This provision requires the 

SBA to conduct a comprehensive review and make recommendations to improve its outreach and services for female veterans, particularly by its Women Business Centers and Veteran Business 

Outreach Centers. 

Sec. 6. Report on the Military Reservists Economic Injury Disaster Loan Program—SBA’s Military Reservists Economic Injury 

Disaster Loan (MREIDL) Program provides disaster assistance in 

the form of direct loans of up to $2 million to help small business 

owners who are not able to obtain credit elsewhere because an essential employee has been called-up to active duty in their role as 

a military reservist or member of the National Guard due to a period of military conflict. The Veterans Entrepreneurship Act requires the SBA to report to Congress on how this program is administered and ways to address program outreach, utilization, and 

effectiveness. 

Æ 


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