29–010 

Calendar No. 168 

113TH CONGRESS REPORT " ! SENATE 1st Session 113–90 

THE EXPANDING ACCESS TO CAPITAL FOR 

ENTREPRENEURIAL LEADERS (EXCEL) ACT OF 2013 

SEPTEMBER 10, 2013.—Ordered to be printed 

Ms. LANDRIEU, from the Committee on Small Business and 

Entrepreneurship, submitted the following 

R E P O R T 

[To accompany S. 511] 

The Committee on Small Business and Entrepreneurship, having 

considered the bill (S. 511), to amend the Small Business Investment Act of 1958 to enhance the Small Business Investment Company Program, and for other purposes, reports favorably thereon, 

with an amendment, and recommends that the bill, as amended, do 

pass. 

I. INTRODUCTION 

The EXCEL Act (S. 511) was introduced by the Committee’s 

Chair, Senator Mary L. Landrieu, on March 11, 2013. The bill’s 

other co-sponsors include Committee members Senator Benjamin 

L. Cardin and Senator William M. Cowan. 

The EXCEL Act improves and enhances the Small Business Administration’s (SBA) Small Business Investment Company (SBIC) 

program at no cost to taxpayers. The bill raises the SBIC program’s 

authorization level to meet growing demand and will make improvements to increase small businesses’ access to capital. 

During markup of the bill, the Risch-Landrieu amendment to the 

bill, which struck sections 4–7 of the underlying EXCEL Act, was 

approved unanimously by voice vote. The bill, as amended, was 

also approved by voice vote. 

II. HISTORY (PURPOSE & NEED FOR LEGISLATION) 

The Small Business Investment Company program is one of several capital access programs administered by the Small Business 

Administration designed to bridge the gap between small busiVerDate Mar 15 2010 18:52 Sep 11, 2013 Jkt 029010 PO 00000 Frm 00001 Fmt 6659 Sfmt 6602 E:\HR\OC\SR090.XXX SR090

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nesses’ need for capital and traditional financing sources. The SBA 

runs this private equity program by guaranteeing money borrowed 

by qualified investment funds who invest in small businesses. The 

qualified funds, or SBICs, are privately owned and operated, but licensed and regulated by the SBA. Using a combination of private 

investments and the debt guaranteed by the SBA, typically at a 

ratio of $2 in guaranteed funds for every $1 of private capital, 

SBICs make long-term investments in American small businesses. 

In order to participate in the program, funds pay licensing fees 

which serve to cover all SBIC program costs. As a result, the core 

SBIC program (Debenture SBICs) not only boasts a strong success 

rate, but also incurs no cost to the U.S. government. 

The Small Business Investment Company program was established by the Investment Company Act of 1958, which was co-sponsored by then-Majority Leader Lyndon B. Johnson and signed into 

law by President Dwight Eisenhower. Since the program’s inception, SBICs have invested over $56 billion in over 100,000 small 

businesses. Companies that have received SBIC funding include 

Apple Computer, AOL, Callaway Golf, Costco, Outback Steakhouse, 

Jenny Craig, and Center Rock of Berlin, Pennsylvania, the manufacturer of the drill bit that saved the Chilean miners in October, 

2010. 

The purpose of the EXCEL Act is to make necessary and timely 

improvements to the already successful SBIC program to increase 

the availability of capital for small businesses. Over the past few 

years, the SBIC program has seen strong growth. For example, in 

Fiscal Year 2011 alone, the program grew by 50 percent. In Fiscal 

Year 2012, the third consecutive record year for the SBIC program, 

SBA-guaranteed leverage commitments totaled nearly $2 billion, 

and the SBA expects demand to continue to grow. However, despite 

this impressive growth, the program’s authorization level, currently 

capped at $3 billion per year, has not been permanently raised 

since 2003. The EXCEL Act contains a provision to raise the SBIC 

program authorization level from $3 billion to $4 billion. In order 

to meet growing demand, the program needs room to grow. 

The second major provision of the EXCEL Act relates to ‘‘families 

of funds.’’ A family of funds refers to a group of several licensed 

funds operated by a team of SBIC fund managers. These funds 

under common control are currently limited to $225 million of SBAguaranteed debt, and several teams of fund managers have already 

bumped against this cap. The EXCEL Act would increase the family of funds limit from $225 million to $350 million. Since SBIC 

fund managers who manage more than one fund generally see better investment results, the EXCEL Act should encourage continued 

and responsible investments in American small businesses at no 

cost to the taxpayer. 

During the 112th Congress, Small Business Committee Chair 

Landrieu and former Ranking Member Olympia Snowe filed S. 

3253, the EXCEL Act of 2012, on May 24, 2012. The bill included 

the program authorization level increase and the increase in the 

family of funds leverage limit, as well as a number of other program enhancements. While the standalone bill was not acted upon 

further by the Committee, Senator Landrieu included the EXCEL 

Act provisions in several other pieces of legislation during the 

112th Congress. 


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Senate Amendment 1833 (S. Amdt. 1833), an amendment in the 

nature of a substitute to the Jumpstart Our Business Startups 

(JOBS) Act of 2012 (H.R. 3606), contained language to raise the 

family of funds limit to $350 million from $225 million and to increase the SBIC program’s authorization level to $4 billion. S. 

Amdt. 1833, the Invigorate New Ventures and Entrepreneurs to 

Succeed Today (INVEST) in America Act of 2012, was introduced 

on March 15, 2012 by Senator Jack Reed along with Chair Landrieu and Senators Levin, Scott Brown, Merkley, Akaka, Whitehouse, Franken, Harkin, and Durbin. S. Amdt. 1833 was ultimately 

not included in the final version of H.R. 3606. 

Additionally, Senator Landrieu included SBIC program enhancements in Senate Amendment 2521 (S. Amdt. 2521), which she filed 

to S. 2237, the Small Business Jobs and Tax Relief Act of 2012, on 

July 11, 2012. Division B of S. Amdt. 2521, entitled the Success Ultimately Comes from Capital, Contracting, Education, Strategic 

Partnerships, and Smart Regulations (SUCCESS) Act, included the 

EXCEL Act of 2012 as a portion of Title II. Although it came up 

short of the 60 votes needed to end debate, the amendment received a strong 57 bipartisan votes, including five Republicans, 

when it received a vote on the Senate floor on July 12, 2012. Shortly thereafter, Chair Landrieu filed the SUCCESS Act as a standalone bill. On July 25, 2012, Chair Landrieu introduced S. 3442, 

the SUCCESS Act of 2012, with eight co-sponsors including Committee members Senator Cardin and Senator Shaheen, as well as 

Senators Blumenthal, Boxer, Gillibrand, Lieberman, Merkley, and 

Whitehouse. 

Ultimately, however, none of the bills or amendments made it to 

the President’s desk during the 112th Congress. 

III. HEARINGS & ROUNDTABLES 

In preparing to draft and introduce the EXCEL Act, the Committee held a number of hearings and roundtables analyzing the 

SBA’s Small Business Investment Company program. Committee 

staff and members heard from a wide range of stakeholders from 

the SBIC community, including small businesses, fund managers, 

and government officials, on the effectiveness of the program and 

how to improve upon its successes. 

In the 112th Congress: 

On March 22, 2012, the Committee held a roundtable entitled, ‘‘A 

Spotlight on Small Business Investment Companies and their Role 

in the Entrepreneurial Ecosystem.’’ The fourteen roundtable participants included representatives from the SBA, SBICs, SBIC investors, and small businesses. It was during this roundtable that 

the Committee elicited suggestions on enhancing the SBIC program that would later comprise the key provisions of the EXCEL 

Act. 

On November 29, 2012, the Committee held a hearing entitled, 

‘‘Creating Jobs and Growing the Economy: Legislative Proposals to 

Strengthen the Entrepreneurial Ecosystem.’’ The purpose of the 

hearing was to discuss the legislative proposals included in the 

‘‘Success Ultimately Comes from Capital, Contracting, Education, 

Strategic Partnerships, and Smart Regulation (SUCCESS) Act of 

2012’’ (S. 3442), which was the result of recommendations gathered 

during a series of three Committee roundtables examining the enVerDate Mar 15 2010 18:52 Sep 11, 2013 Jkt 029010 PO 00000 Frm 00003 Fmt 6659 Sfmt 6602 E:\HR\OC\SR090.XXX SR090

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trepreneurial ecosystem during the 112th Congress. Among the 

provisions that the Committee examined during the hearing were 

those included in the version of the EXCEL Act that Chair Landrieu and former Ranking Member Snowe introduced during the 

112th Congress. 

In the 113th Congress: 

On March 14, 2013, the Committee held a roundtable entitled 

‘‘Helping Small Businesses Weather Economic Challenges & Natural Disasters: Review of Legislative Proposals on Access to Capital 

and Disaster Recovery.’’ The purpose of the roundtable was to discuss four legislative proposals on small business access to capital 

and disaster recovery on which the Committee would focus during 

the beginning of the 113th Congress, including the EXCEL Act. 

Participants included a wide range of small business owners, investors, and stakeholders, and SBA representatives, including the Associate Administrator for the SBA’s Office of Capital Access. The 

roundtable followed up on previous Committee roundtables and legislative hearings held during the 112th Congress and provided an 

opportunity for Committee members to highlight their relevant priorities ahead of an upcoming markup on access to capital and disaster recovery legislation. 

IV. DESCRIPTION OF BILL 

The purpose of S. 511, the Expanding Access to Capital for Entrepreneurial Leaders (EXCEL) Act, is to make necessary and timely improvements to the already successful SBIC program to increase the availability of equity capital for small businesses. The 

bill, as amended by the Risch-Landrieu amendment, which struck 

sections 4–7 of the underlying EXCEL Act, contains two major provisions to enhance the program, both of which come at no cost to 

the taxpayer: 

Section 2 of the bill raises the amount of SBIC debt that the 

Small Business Administration (SBA) can guarantee from $3 billion to $4 billion, indexed to inflation. Despite inflation and the impressive growth that the program has seen over the past few years, 

the program’s authorization level has not been permanently raised 

since 2003. 

Section 3 of the bill would increase the amount of leverage available to SBIC licensees under common control—also known as a 

‘‘family of funds’’—from $225 million to $350 million. Fund managers who manage more than one fund generally see better investment results, and this provision will continue supporting successful 

fund managers, thereby deploying more capital to America’s small 

businesses. 

V. COMMITTEE VOTE 

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

Senate, the following vote was recorded on June 17, 2013. 

A motion to adopt the Expanding Access to Capital for Entrepreneurial Leaders (EXCEL) Act of 2013, to amend the Small Business Investment Act of 1958 to enhance the Small Business Investment Company Program, as amended by the Risch-Landrieu 

amendment, was approved by a voice vote, with the following Senator voting in the negative: Scott. 


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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: 

AUGUST 2, 2013. 

Hon. MARY L. LANDRIEU, 

Chair, Committee on Small Business and Entrepreneurship, 

U.S. Senate, Washington, DC. 

DEAR MADAM CHAIR: The Congressional Budget Office has prepared the enclosed cost estimate for S. 511, the Expanding Access 

to Capital for Entrepreneurial Leaders Act. 

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

to provide them. The CBO staff contact is Susan Willie. 

Sincerely, 

DOUGLAS W. ELMENDORF. 

Enclosure. 

S. 511—Expanding Access to Capital for Entrepreneurial Leaders 

Act 

S. 511 would set the maximum amount of debt that the Small 

Business Administration (SBA) can guarantee under the Small 

Business Investment Company (SBIC) program at $4 billion per 

year, adjusted annually for inflation. Further, the bill would raise 

the maximum amount of debt that the SBA can guarantee for a 

group of companies participating in the program that are operated 

together (‘‘a family of funds’’) from $225 million to $350 million. 

Under current law, businesses participating in the SBIC program 

are required to pay various fees that are sufficient to offset the program’s estimated subsidy cost—that is, the estimated long-term 

cost to the government of a loan guarantee, calculated on a netpresent-value basis. Based on information from SBA, CBO expects 

that increasing the loan levels for the program and for a family of 

funds would not affect the estimated subsidy cost, nor would the 

changes increase the cost to administer the program (which is recorded on a cash basis). Therefore, CBO estimates that implementing S. 511 would not affect discretionary spending. Enacting 

S. 511 would not affect direct spending or revenues; therefore, payas-you-go procedures do not apply. 

S. 511 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 Susan Willie. The estimate was approved by Theresa Gullo, Deputy 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. 


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VIII. SECTION-BY-SECTION ANALYSIS 

Sec. 1. Title 

This section provides the title of the bill. The Act may be cited 

as the ‘‘Expanding Access to Capital for Entrepreneurial Leaders 

Act’’ or the ‘‘EXCEL Act’’. 

Sec. 2. Program authorization 

This section raises the program authorization level to $4,000,000,000. That limit will be indexed for inflation. 

Sec. 3. Family of funds 

This section raises from $225,000,000 to $350,000,000 the maximum amount of outstanding leverage available to two or more 

funds under common control. 

Æ 


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