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SUBCOMMITTEE MARKUP OF LEGISLATION 

AFFECTING THE SBA CAPITAL ACCESS PROGRAMS 

HEARING 

BEFORE THE

COMMITTEE ON SMALL BUSINESS 

UNITED STATES 

HOUSE OF REPRESENTATIVES 

ONE HUNDRED ELEVENTH CONGRESS 

FIRST SESSION 

HEARING HELD 

OCTOBER 8, 2009 

Small Business Committee Document Number 111-050 

Available via the GPO Website: http://www.access.gpo.gov/congress/house 


Congress.#13
HOUSE COMMITTEE ON SMALL BUSINESS 

NYDIA M. VELA ́ ZQUEZ, New York, Chairwoman 

DENNIS MOORE, Kansas 

HEATH SHULER, North Carolina 

KATHY DAHLKEMPER, Pennsylvania 

KURT SCHRADER, Oregon 

ANN KIRKPATRICK, Arizona 

GLENN NYE, Virginia 

MICHAEL MICHAUD, Maine 

MELISSA BEAN, Illinois 

DAN LIPINSKI, Illinois 

JASON ALTMIRE, Pennsylvania 

YVETTE CLARKE, New York 

BRAD ELLSWORTH, Indiana 

JOE SESTAK, Pennsylvania 

BOBBY BRIGHT, Alabama 

PARKER GRIFFITH, Alabama 

DEBORAH HALVORSON, Illinois 

SAM GRAVES, Missouri, Ranking Member 

ROSCOE G. BARTLETT, Maryland 

W. TODD AKIN, Missouri 

STEVE KING, Iowa 

LYNN A. WESTMORELAND, Georgia 

LOUIE GOHMERT, Texas 

MARY FALLIN, Oklahoma 

VERN BUCHANAN, Florida 

BLAINE LUETKEMEYER, Missouri 

AARON SCHOCK, Illinois 

GLENN THOMPSON, Pennsylvania 

MIKE COFFMAN, Colorado 

MICHAEL DAY, Majority Staff Director 

ADAM MINEHARDT, Deputy Staff Director 

TIM SLATTERY, Chief Counsel 

KAREN HAAS, Minority Staff Director 

(II) 

STANDING SUBCOMMITTEE 

Subcommittee on Finance and Tax 

KURT SCHRADER, Oregon, Chairman 

DENNIS MOORE, Kansas 

ANN KIRKPATRICK, Arizona 

MELISSA BEAN, Illinois 

JOE SESTAK, Pennsylvania 

DEBORAH HALVORSON, Illinois 

GLENN NYE, Virginia 

MICHAEL MICHAUD, Maine 

VERN BUCHANAN, Florida, Ranking 

STEVE KING, Iowa 

W. TODD AKIN, Missouri 

BLAINE LUETKEMEYER, Missouri 

MIKE COFFMAN, Colorado 

(III) 

C O N T E N T S 

OPENING STATEMENTS 

Page 

Schrader, Hon. Kurt ................................................................................................ 1 

Buchanan, Hon. Vern .............................................................................................. 2 

APPENDIX 

Reviewed Bills: 

H.R. 3723: ’The Small Business Credit Expansion and Loan Markets Stabilization Act of 2009’ .......................................................................................... 13 

H.R. 3739: ’The Job Creation and Economic Develpment Through CDC 

Modenization Act of 2009’ ................................................................................... 41 

H.R. 3737: ’Small Business Microlending Act of 2009’ ......................................... 139 

H.R. 3740: ’The Small Business Investment Company Modernization and 

Improvement Act of 2009’ .................................................................................... 148 

H.R. 3722: ’The Enhanced New Markets and Expanded Investment in Renewable Energy for Small Manufacturers Act of 2009’ ........................................... 164 

H.R. 3014: ’The Small Business Health Information Technology Financing 

Act’ ......................................................................................................................... 178 

H.R. 3738: ’The Small Business Early Stage Investment Act of 2009’ ............... 184 

H.R. 3743: ’The Small Business Disaster Readiness and Reform Act of 2009’ .. 195 

Statements for the Record: 

Larsen, Hon. Rick .................................................................................................... 204 

(V) 

(1) 

SUBCOMMITTEE ON FINANCE AND TAX 

MARKUP OF LEGISLATION AFFECTING 

THE SBA CAPITAL ACCESS PROGRAMS 

Thursday, October 8, 2009 

U.S. HOUSE OF REPRESENTATIVES, 

COMMITTEE ON SMALL BUSINESS, 

Washington, DC. 

The Subcommittee met, pursuant to call, at 10:03 a.m., in Room 

2360, Rayburn House Office Building, Hon. Kurt Schrader [chairman of the Subcommittee] presiding. 

Present: Representatives Schrader, Moore, Kirkpatrick, Bean, 

Halvorson, Buchanan, Luetkemeyer and Coffman. 

Chairman SCHRADER. I am pleased to call this morning’s markup 

to order for the Subcommittee on Finance and Tax. Today the Subcommittee will consider legislation reauthorizing SBA’s access to 

capital programs. These resources, which are critical to small firms 

in all stages of growth, have not been fully modernized in at least 

8 years. Needless to say, entrepreneurs’ financing needs have since 

changed dramatically. In this morning’s markup we have an opportunity to update these resources to reflect those changes and help 

small firms grow and enhance their ventures once again. 

The SBA offers a diverse catalog of lending and investment programs. When the private sector is unable to meet small business 

needs, these initiatives bridge the gap. But while SBA’s lending options are of enormous value, they are also in need of strengthening 

and expanding. 

The continued success of SBA’s lending programs hinge on three 

primary issues: First, they must evolve to reflect the financing 

needs of today’s businesses; second, SBA must devote more management resources to program maintenance; and, thirdly, the agency should take this opportunity to break the mold and reach out 

to new and more sophisticated lenders and upgrade their own practices. 

The eight bills before us today address these issues head on, and 

could not have come together without the hard work of their sponsors: Representative Halvorson, Ranking Member Buchanan, Representative Ellsworth, Representative Luetkemeyer, Representative 

Kirkpatrick, Representative Dahlkemper, Representative Nye, and 

Representative Griffith. 

Modernizing SBA’s access to capital programs is one of the most 

important policy steps we can take in this particular Congress. 

Doing so will strengthen the small business community, allow enVerDate Aug 31 2005 12:46 Dec 14, 2009 Jkt 000000 PO 00000 Frm 00007 Fmt 6633 Sfmt 6633 G:\CLERKS~1\HEARINGS\TRANSC~1\52890.TXT DARIEN
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trepreneurs to create jobs, and begin to grow our economy once 

again. 

[The information is included in the appendix.] 

Chairman SCHRADER. I will now yield to Ranking Member Buchanan for his opening remarks. 

Mr. BUCHANAN. I want to thank the Chairman for holding this 

important markup legislation affecting the SBA capital access programs. 

Today, clearly banks are not lending to small businesses. They 

can’t secure the capital or the credit they need. The reality in 

southwest Florida and all over Florida: If you want to borrow $1 

million, you have got to put up a $1 million CD. A lot of real estate 

has been secured in the past or loans have been secured in the past 

by real estate, but banks don’t even want the real estate today, for 

obvious reasons. So there is little or no credit, and that is killing 

jobs in America. 

Currently we have 15.1 million Americans that are officially out 

of work. Now, more than ever, we must rely on small business to 

creates 70 percent of the jobs not only in Florida, but across the 

country. Ninety-nine percent of all businesses that are registered 

in Tallahassee, our capital in Florida, 99 percent of them are small, 

medium-sized firms, and they create the jobs. 

I held a small business conference in our area; had 130 small, 

medium-sized businesses at that conference. When I started the 

meeting, I asked everybody in the room, I said, what is your relationship? What has it been? What is it today? Are you having 

struggles with the banks renewing lines of credit, this, and whatever? And the bottom line was clearly 99 percent of the people in 

the room had raised their hand that they are concerned about even 

their business going forward without the lines of credit. 

Today we are going to take significant steps, I believe, in alleviating some of the problems facing our Nation’s small business. 

Today I introduce a job creation and economic development concept, or a bill that is the CDC Modernization Act of 2009. It is H.R. 

3739. The CDC program was created to provide long-term financing 

for development and construction of plants, facilities, and other 

hard assets. My bill will modernize title V of the Small Business 

Investment Act and significantly increase lending limits by CDCs. 

This will ensure that small businesses will get the capital they 

need to expand their business and, ideally, create more jobs. 

While I plan on voting for all the bills today, I do have some concerns in particular on the loan limits on the 7(a) program, which 

I believe will restrict the ability of some small and, ideally, medium-sized business to get the capital they need. But I look forward 

to working with the Chairman. I plan on being supportive, but I 

am hoping we can do more in that area. 

I yield back, Mr. Chairman. 

Chairman SCHRADER. Thank you very much. Good remarks. 

[The information is included in the appendix.] 

Chairman SCHRADER. Are there other Members who wish to be 

recognized for the purpose of opening remarks? 

Representative Luetkemeyer from Missouri. 

Mr. LUETKEMEYER. Good morning, and thank you, Mr. Chairman, for the opportunity to mark up critical legislation aimed at 

3 

making the Small Business Administration’s capital access programs more effective and responsive to the needs of small businesses. 

At a time when small businesses are still struggling to keep their 

doors open, we must continue to work to improve the usefulness of 

these initiatives to ensure that our small businesses are able to 

fully utilize all available resources. Most small business owners remain cautious in their economic outlook, with more than two-thirds 

saying the recession is not over for them, according to a September 

2009 Discover Small Business Watch Index. Many people are eager 

for a definitive signal that the economy is on the mend, but America’s small business owners aren’t able to send that message yet. 

This is at a time when access to credit is being denied at an accelerating pace. 

Small businesses have never had a harder time to get a loan. 

Since the onset of the credit crisis over 2 years ago, available credit 

to small businesses and consumers has contracted by trillions of 

dollars, and that occurrence is reflected in dismal consumer spending trends. Without access to credit, small businesses can’t grow, 

can’t hire, and too often end up going out of business. 

As a small businessman, I am pleased to introduce a bill that 

will assist many small business owners and employees throughout 

my district in Missouri and all throughout the country. Small businesses employee 50 percent of the country’s workforce and contribute 38 percent of the GDP. Like every recession before, small 

business will lead the way to an economic recovery. 

H.R. 3740, the Small Business Investment Company Modernization Improvement Act of 2009, updates and streamlines the SBA’s 

largest investment program, the Small Business Investment Company Program. The legislation aims to increase the number and 

size of investments made to small firms under the program. Perhaps equally important, the bill endeavors to halt the continued 

flight of SBICs that participate in the program by establishing an 

expedited licensing program. This will keep successful SBICs that 

are in good standing involved in the program. 

The bill will also revise the SBIC leverage limitations to create 

an incentive for well-managed SBICs to remain in the program. 

This will be possible by allowing SBICs that are managed by the 

same management team to access the increased leverage limits 

available for a family of SBIC funds. Businesses will have access 

to greater investment under the provisions of the bill that expand 

the Energy Saving Debenture Program and increase the amounts 

of leverage available to invest in veteran-owned businesses. Burdensome SBA regulations that limit businesses’ ability to prepay 

SBIC leverage will also be eliminated, enabling businesses to prepay a safe amount of their SBIC investment without prior approval 

from the SBA. This change will provide businesses with greater 

flexibility in managing investment funds they receive under the 

program. 

Finally, the bill makes a number of technical revisions to the 

SBIC program that will increase the overall efficacy of the program. 

I know that the Small Business Committee here in this House 

and this Subcommittee recognize how critical small business is to 

4 

the economic health of this country. That is why I want to thank 

my colleagues for their commitment to sponsoring legislation to improve programs that assist our country’s small business owners. I 

am pleased to see my bill and my colleagues’ legislation working 

their way through the legislative process, and look forward to seeing these bills become law. 

With that, I yield back, Mr. Chairman. Thank you. 

Chairman SCHRADER. Thank you. 

[The information is included in the appendix.] 

Chairman SCHRADER. Any other Member wish to speak? 

Seeing none, the first order of business is to consider House Resolution 3723, the Small Business Credit Expansion and Loan Markets Stabilization Act of 2009, introduced by Representative 

Halvorson. This bill makes important steps to broaden the reach of 

the 7(a) SBA, SBA’s largest lending program. 

In the past, 7(a) has been a tremendously important initiative, 

but despite its historic value, the program is no longer living up to 

its full potential. As a result, many small firms have struggled to 

access the capital they need to weather the recession. 

House Resolution 3723 is a comprehensive answer to this concern. Importantly, it extends the loan guarantees and fee exemptions established by the Recovery Act. It also makes 7(a) more 

adaptable, revising it to expand when markets contract. On their 

own, these two changes will make the program more affordable and 

more accessible. When coupled with larger loan sizes, they will go 

a long way in delivering the capital to the small firms when they 

need it most. In increasing the size of the 7(a) loans, we are giving 

entrepreneurs the financing they need to enhance their ventures, 

and we are doing it in a way that actually minimizes the risk to 

taxpayers. 

Finally, H.R. 3723 expands efforts to bring affordable capital to 

rural regions and veteran entrepreneurs, both of which have historically been underrepresented in the small business community. 

This bill is supported by the National Restaurant Association, 

the International Franchise Association, National Association of 

Federal Credit Unions, and National Cooperative Business Association, Independent Community Bankers of America, and the Credit 

Union National Association. I support this legislation and urge its 

adoption. 

Are there any other Members that wish to be recognized on 

House Resolution 3723? 

Representative Halvorson from Illinois. 

Mrs. HALVORSON. Thank you, Chairman Schrader and Representative Buchanan, for holding this morning’s markup. This is 

a great opportunity for us to consider legislation that will update 

the SBA’s capital access programs. 

I have held many small business roundtables throughout my district and have found that at every single one of them, the number 

one thing that comes up is the biggest challenges facing our small 

business owners is access to capital. 

We all know that small businesses need capital to expand and 

to grow, but the tight credit market has been increasingly difficult 

for them to do so. The SBA’s capital access programs are supposed 

to be a resource for small business owners when they have difVerDate Aug 31 2005 12:46 Dec 14, 2009 Jkt 000000 PO 00000 Frm 00010 Fmt 6633 Sfmt 6633 G:\CLERKS~1\HEARINGS\TRANSC~1\52890.TXT DARIEN
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ficulty accessing credit from traditional sources. Unfortunately, we 

have seen a recent decrease in the SBA’s loan volume. 

In fiscal year 2009, SBA made 36 percent fewer loans than it did 

in 2008. This is something that must be addressed, and that is why 

I have introduced H.R. 3723, the Small Business Credit Expansion 

and Loan Markets Stabilization Act. My bill will improve and enhance SBA’s flagship 7(a) loan program. It increases the maximum 

loan level and expands provisions in the American Recovery and 

Reinvestment Act that increases the SBA loan guarantee to 90 percent. H.R. 3723 also increases SBA’s outreach to rural and small 

lenders to encourage them to participate in 7(a). 

My bill will extend a few of the SBA’s other capital access programs. H.R. 3723 extends the ARC loan program created by the 

Recovery Act and increases the maximum award from 35,000 to 

50,000 interest free. 

Finally, my bill will make the SBA’s Community Express pilot 

program permanent. Community Express helps provide loans to 

businesses owned by women, minorities, and veterans. 

H.R. 3723 will take major steps to improve the SBA’s capital access programs so that we can provide our Nation’s small business 

owners with the tools they will need to put us on the road to economic recovery. I ask for the Subcommittee’s support, and I yield 

back the balance of my time. 

Chairman SCHRADER. Does anyone else wish to speak on behalf 

of House Resolution 3723? 

Seeing none, the Committee now moves to consideration of House 

Resolution 3723. The clerk will report the title of the bill, please. 

The CLERK. To amend the Small Business Act to improve the activities carried out under section 7(a) of such act, and for other purposes. 

[The information is included in the appendix.] 

Chairman SCHRADER. I ask unanimous consent that the bill in 

its entirety be open for amendments at this time. Does any Member seek recognition? 

Seeing none, the question is on reporting House Resolution 3723 

to the full Committee. All those in favor, say aye. 

Those opposed, say no. 

The bill is adopted and reported to the full Committee. 

Chairman SCHRADER. We will now consider House Resolution 

3739, the Job Creation Economic Development Through CDC Modernization Act of 2009, introduced by our Ranking Member Buchanan. 

The Certified Development Company program helps businesses 

secure capital for fixed-asset purchases. This initiative relies on a 

unique financing process, one that allows both CDCs and privatesector lenders to invest in small firms. This arrangement helps 

businesses secure loans of up to $10 million at a fixed rate. That 

particular provision is critical as it provides an element of stability 

in these otherwise very uncertain times. 

House Resolution 3739 will go a long way in modernizing the 

CDC program. Among its most important changes is an increase in 

loan size. By raising levels to 12.5 million, it will give middle-market firms a chance to participate in the SBA program. Meanwhile, 

CDCs stand to gain greater flexibility for liquidating defaulted 

6 

loans, and that alteration will ease costs to taxpayers. Finally, 

small firms will have an opportunity to make larger equity injections, thereby reducing their debt levels. Through these changes, 

the CDC program will remain a powerful tool for economic development. 

The National Association of Development Companies supports 

this legislation, and I urge Members to support it as well. 

Are there any Members who wish to be recognized? 

Ranking Member Buchanan. 

Mr. BUCHANAN. Thank you, Mr. Chairman. 

I think I mentioned obviously where I am at on this, but I do 

want to add one thing in terms of the SBA. In talking with a lot 

of banks and participants in the program, we really challenge the 

SBA. We need to figure out a way to get more banks to participate. 

A rot of them say it takes too long, it is not profitable. They have, 

it seems, very little or no interest in many of these programs, and 

many of the participants in the program get discouraged because 

it takes so long. 

So I just want to add, as we are looking at these new proposals 

today, which I think will be enacted as a part of law, we have got 

to find a way for our participants, because the banks are carrying 

most of this out, because we have got people that want them, but 

for one reason or another they are not getting out to the public. 

People are saying it just takes too long, costs too much, and nobody 

is excited about them. So we have got to find a way to deal with 

that. 

I yield back. Thank you. 

Chairman SCHRADER. Thank you. 

Does anyone else wish to be recognized? 

Seeing none, the committee now moves to consideration of House 

Resolution 3739. The clerk will report the title of the bill. 

The CLERK. To amend title V of the Small Business Investment 

Act of 1958 to provide for improved long-term financing to small 

business concerns, and for other purposes. 

[The information is included in the appendix.] 

Chairman SCHRADER. I ask unanimous consent that the bill in 

its entirety be open for amendments at this time. 

Does any Member seek recognition for the purpose of offering an 

amendment? 

Seeing no amendments, the question is on reporting House Resolution 3739 to the full Committee. All those in favor, say aye. 

Opposed. 

Passage is unanimous. The bill is adopted and reported to the 

full Committee. 

Chairman SCHRADER. The next order of business, consider House 

Resolution 3737, the Small Business Microlending Expansion Act 

of 2009, introduced by Representative Ellsworth. 

The bill enhances SBA’s Microloan Program, an initiative that 

supplements traditional loans with technical assistance. That combination allows borrowers to access the capital they need to start 

a business and the guidance they need to make that business a 

success. 

Oftentimes it is the smallest firms that produce the largest returns in our economy in the future. They create jobs where there 

7 

were none before and deliver economic empowerment to historically 

underserved communities. House Resolution 3737 takes steps to 

bolster these small businesses by reducing their interest rates on 

loans. This is a key element, because lower interest rates give entrepreneurs more room for growth and greater flexibility for investment. 

The Corporation for Enterprise Development supports this legislation. I urge Members to back it as well. 

Are there any other Members that wish to be recognized on 

House Resolution 3737? 

Seeing none, the Committee now moves to consideration of House 

Resolution 3737. The clerk will report the title of the bill. 

The CLERK. To amend the Small Business Act to improve the 

Microloan Program, and for other purposes. 

[The information is included in the appendix.] 

Chairman SCHRADER. I ask unanimous consent that the bill in 

its entirety be open for amendments at this time. 

Does any Member seek recognition for the purpose of offering an 

amendment? 

Seeing no amendments, the question is on reporting House Resolution 3737 to the full Committee. All those in favor, say aye. 

Opposed, say no. 

The ayes have it. The bill is adopted and reported to the full 

Committee. 

Chairman SCHRADER. We will now consider House Resolution 

3740, the Small Business Investment Company Modernization and 

Improvement Act of 2009, introduced by Representative 

Luetkemeyer. 

House Resolution 3740 will update and streamline SBA’s largest 

investment option, the Small Business Investment Company Program. After the participating securities program was cut in 2004, 

SBIC became best known for the debentures program, which provides debt-oriented capital to later-stage businesses. Despite 

changes to its original format, SBIC remains a critical initiative. 

House Resolution 3740 seeks to build on its success by increasing 

the number of and size of investments made in small firms. It also 

creates incentives to encourage participation amongst successful, 

well-managed SBICs. 

To spur innovation this bill gives SBA the freedom to create a 

new pilot program within SBIC. While this authority would be subject to certain limitations, successful trial initiatives could inspire 

new investment models we need to see down the road. 

The SBIC program remains an important part of SBA’s investment portfolio, and House Resolution 3740 will ensure it continues 

to be a valuable asset. This legislation is supported by the National 

Association of Small Business Investment Companies, and I urge 

Members to support it. 

Are there any Members that wish to be recognized? 

Seeing none, the Committee now moves to consideration of House 

Resolution 3740. The clerk will report the title of the bill. 

The CLERK. To amend the Small Business Investment Act of 

1958 with respect to small business investment companies, and for 

other purposes. 

[The information is included in the appendix.] 

8 

Chairman SCHRADER. I ask unanimous consent that the bill in 

its entirety be open for amendments at this time. 

Does any Member seek recognition for the purpose of offering an 

amendment? 

Seeing no amendments, the question is on reporting House Resolution 3740 to the full Committee. All those in favor, signify by saying aye. 

Those opposed, say no. 

The ayes have it. The bill is adopted, reported to the full Committee. 

Chairman SCHRADER. We will now consider House Resolution 

3722, the Enhanced New Markets and Expanded Investment in Renewable Energy for Small Manufacturers Act of 2009, introduced 

by Representative Kirkpatrick. 

The New Markets program operates as a public-private partnership between the SBA and licensed new markets venture capital 

companies. It is a vital source of investment for our underserved 

communities. 

Since its enactment in 2001, the program has made available a total of $149 million. That includes $62.4 million in non-Federal 

funding for low-income areas across 15 States. House Resolution 

3722 will expand that reach even further. It will do this by requiring that SBA ensure nationwide distribution for the new markets 

program, thereby growing its network of investment firms. Additionally, the legislation places an increased emphasis on small 

manufacturers in low-income areas. Doing so will bolster struggling 

sectors of our economy and the communities that have been hit 

hardest by this recession. 

In the same vein, House Resolution 3722 addresses the needs of 

small suppliers in our beleaguered auto industry. It does this by increasing assistance for manufacturers looking to retool and update 

their operations. 

For struggling communities across this country, the benefits of 

House Resolution 3722 will be twofold. Not only will it bring new 

investment, but it will also create much-needed jobs, and I urge 

Members to support this legislation. 

Are there any Members who wish to be recognized on House Resolution 3722? 

Representative Kirkpatrick from Arizona. 

Mrs. KIRKPATRICK. Thank you, Mr. Chairman. 

Today I am pleased to offer House Resolution 3722, the Enhanced New Markets and Expanded Investment in Renewable Energy for Small Manufacturers Act. This legislation will reform two 

critical programs at the Small Business Administration. The New 

Markets Venture Capital Initiative provides investment capital to 

businesses in some of our Nation’s most economically distraught 

communities. While this program has made significant contributions, several obstacles have prevented it from reaching its full potential. 

In 2001, the Southwest Development Fund applied to be a new 

market venture capital company. The fund, located in Arizona, 

filled out the paperwork and received conditional approval from the 

Small Business Administration. Unfortunately, the fund was unable to obtain final approval from the SBA before the expiration of 

9 

the agency’s deadline. As a result, promising sources of new capital 

for Arizona businesses never got off the ground. Investment dollars 

that could have sparked entrepreneurship in some of Arizona’s 

most economically depressed communities, which I represent, went 

elsewhere. I suspect this story is all too common. 

My bill will speed up the application process and provide operational assistance from SBA while applicants are awaiting final approval. This will mean more companies make it through the process and ultimately invest in small businesses. 

Small manufacturers in low-income areas can benefit tremendously from new market venture capital investments. House Resolution 3722 spurs investments in small manufacturers in economically struggling communities. By helping these entrepreneurs, we 

can maintain a strong manufacturing base in this country and support good-paying jobs. 

We can also support job growth by expanding entrepreneurs’ role 

in clean energy fields like wind, solar, and biofuels. Small businesses are pioneering these new fields in Arizona and across the 

country. The Renewable Energy Capital Initiative was designed to 

help small businesses obtain capital for renewable fuels projects. 

Currently only smaller enterprises, those with less than $2 million 

in income over the last 2 years, are eligible to participate. By opening the program to all small businesses as defined by the SBA, we 

will further promote clean energy entrepreneurship. 

Mr. Chairman, access to capital remains one of the toughest 

challenges facing our small businesses. House Resolution 3722 will 

strengthen two programs at the SBA that help small businesses 

raise investment capital. I urge passage of this bill, and I yield 

back. 

Chairman SCHRADER. Thank you. 

Anyone else wishing to comment on House Resolution 3722? 

Seeing none, the Committee now moves to consideration of House 

Resolution 3722. The clerk will report the title of the bill, please. 

The CLERK. To amend the Small Business Investment Act of 

1958 to improve the New Markets Venture Capital and Renewable 

Fuel Capital Investment Programs, and for other purposes. 

[The information is included in the appendix.] 

Chairman SCHRADER. I ask unanimous consent that the bill in 

its entirety be open for amendments at this time. 

Does any Member seek recognition for the purpose of offering an 

amendment? 

Seeing no amendments, the question is on reporting House Resolution 3722 to the full Committee. All those in favor, signify by saying aye. 

Opposed, say nay. 

The ayes have it. The bill is adopted and reported to the full 

Committee. 

Chairman SCHRADER. We will now consider House Resolution 

3014, the Small Business Health Information Technology Financing Act, introduced by Representative Dahlkemper. 

Health information technology, or HIT, is the hardware and software that makes electronic medical records a reality. With widespread use, HIT has the potential to improve quality by preventing 

errors, reducing costs, and increasing administrative efficiency. But 

10 

HIT is a very costly commodity. As such, it is typically found only 

in large medical institutions. This is problematic, because most 

Americans rely on physicians in solo and small group practices. 

House Resolution 3014 remedies this by providing reduced-cost 

capital to small firms looking to purchase the technology. That 

way, doctors and patients in every pocket of this country can enjoy 

the benefits and rewards of HIT. 

This legislation provides small firms with more than just the 

capital to purchase HIT. It is carefully tailored to meet the unique 

challenges small firms face in its adoption and implementation. 

I believe that House Resolution 3014 can assist in improving 

health care in the United States, and I urge Members to join the 

American Dental Association and the American Osteopathic Association in supporting this legislation. 

Are there any other Members that wish to be recognized at this 

time? 

Seeing none, the Committee now moves to consideration of House 

Resolution 3014. The clerk will report the title of the bill. 

The CLERK. To amend the Small Business Act to provide loan 

guarantees for the acquisition of health information technology by 

eligible professionals in solo and small group practices, and for 

other purposes. 

[The information is included in the appendix.] 

Chairman SCHRADER. I ask unanimous consent that the bill in 

its entirety be open for amendments at this time. 

Does any Member seek recognition to offer an amendment? 

Seeing no amendments, the question is on reporting House Resolution 3014 to the full Committee. All those in favor, say aye. 

Opposed, say no. 

The ayes have it. The bill is adopted and reported to the full 

Committee. 

Chairman SCHRADER. We will now consider House Resolution 

3738, the Small Business Early-Stage Investment Act of 2009, 

sponsored by Representative Nye. 

Beginning in the last quarter of 2008, investments in early-stage businesses plunged $5.4 billion. That drop marked a decline of 26.5 

percent from the previous quarter and a dwindling of resources for 

small business startups. This is especially troubling, considering 

that these businesses are integral to creating new jobs and driving 

growth, particularly as the economy exits this recession. 

Historically the SBA has relied on the SBIC Participating Securities Program to fill gaps in the capital markets. In the last 5 years, 

however, the agency has not licensed any new equity investment 

firms under this program. As a result, small firms have struggled 

to secure much-needed capital. House Resolution 3738 addresses 

that void, and it does so in a manner that balances the demands 

of the free market with the need to safeguard taxpayers’ interests. 

Under the legislation, SBA provides funds to highly qualified investment companies. In turn, these firms will direct investments to 

early-stage businesses in targeted industries such as information 

technology and agriculture. With those fields, investments will be 

geared towards research, development, and manufacturing. 

House Resolution 3738 incorporates several measures to protect 

the taxpayers. These safeguards include a requirement that investVerDate Aug 31 2005 12:46 Dec 14, 2009 Jkt 000000 PO 00000 Frm 00016 Fmt 6633 Sfmt 6633 G:\CLERKS~1\HEARINGS\TRANSC~1\52890.TXT DARIEN
11 

ment companies match grant requests with capital from non-Federal sources. SBA will also conduct audits of participating companies; that way we can be sure that grants are invested in a fashion 

that is consistent with our law. Furthermore, investment funds 

must commit to repaying all investors, including the SBA, with 

cash. Even more importantly, SBA will always be reimbursed first. 

The IAO, the National Venture Capital Association, and the Association of Investment Companies all support this legislation, and 

I urge Members to support its passage. 

Are there any other Members that wish to be recognized on 

House Resolution 3738? 

Seeing none, the Committee now moves to consideration of House 

Resolution 3738. The clerk will report the title of the bill. 

The CLERK. To amend the Small Business Investment Act of 

1958 to establish a program for the Small Business Administration 

to provide financing to support early-stage small businesses in targeted industries, and for other purposes. 

[The information is included in the appendix.] 

Chairman SCHRADER. I ask unanimous consent that the bill in 

its entirety be open for amendments at this time. 

Does any Member wish to be recognized for the purpose of 

amendment? 

Seeing no amendments, the question is on reporting House Resolution 3738 to the full Committee. All those in favor, say aye. 

Those opposed, say no. 

The ayes have it. The bill is adopted and reported to the full 

Committee. 

Chairman SCHRADER. Finally, we will consider House Resolution 

3743, the Small Business Disaster Readiness and Reform Act of 

2009, introduced by Representative Griffith. 

For businesses and homeowners touched by catastrophe, SBA’s 

Disaster Loan Program is a financial lifeline. But if GAO’s July report on the program is any guide, SBA still has a long ways to go 

in improving disaster loan funds. 

House Resolution 3743 includes several provisions to ensure SBA 

can respond to the next major catastrophe. This legislation provides the agency with a variety of tools to improve its response 

process. To begin, it streamlines the manner in which disaster 

loans are processed, approved, disbursed, and repaid. In addressing 

shortcomings and planning, the bill establishes regional working 

groups. Doing so will enable SBA, hopefully, to respond to the multitude of different disasters that could impact our country. Finally, 

House Resolution 3743 tailors assistance to fit the express needs of 

small firms following a disaster. 

In preparing for a national catastrophe, the agency’s work is 

never done. That is because when it comes to disaster loans, SBA’s 

primary task is to remain vigilant. House Resolution 3743 will ensure that it does, and will prevent complacency from taking root. 

I urge the adoption of this legislation. 

Are there any other Members that wish to be recognized on 

House Resolution 3743? 

Seeing none, the Committee now moves to consideration of House 

Resolution 3743. The clerk will report the title of the bill. 

12 

The CLERK. To amend the Small Business Act to improve the disaster relief programs of the Small Business Administration, and for 

other purposes. 

[The information is included in the appendix.] 

Chairman SCHRADER. I ask unanimous consent that the bill in 

its entirety be open for amendments at this time. 

Does any Member seek recognition for the purpose of offering an 

amendment? 

Seeing no amendments, the question is on reporting House Resolution 3743 to the full Committee. All those in favor, say aye. 

Those opposed, say no. 

The ayes have it. The bill is adopted and reported to the full 

Committee. 

This concludes our Subcommittee business for today. I ask unanimous consent that the Subcommittee is authorized to correct section numbers, punctuation, cross references, and make necessary 

technical and conforming corrections on the bills considered today. 

Without objection, so ordered. 

I appreciate everyone’s hard work. The markup is adjourned. 

[Whereupon, at 10:37 a.m., the Subcommittee was adjourned.] 

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