IV 

113TH CONGRESS 

2D SESSION H. RES. 702 

Affirming that private equity plays an important role in growing and strengthening United States businesses throughout all sectors of the economy 

and in every State and congressional district and that it has fostered 

significant investment in the United States economy. 

IN THE HOUSE OF REPRESENTATIVES 

JULY 31, 2014 

Mr. CONAWAY (for himself, Mr. PEARCE, Mr. LUETKEMEYER, Mr. 

SOUTHERLAND, Mr. COLLINS of New York, Mr. HUDSON, Mr. BARTON, 

Mr. HALL, Mr. THORNBERRY, Mr. SESSIONS, Mr. STOCKMAN, Mr. 

MARCHANT, Mr. MCHENRY, Mr. NEUGEBAUER, Mr. HURT, Mr. CARTER, 

Mr. FARENTHOLD, Mr. AUSTIN SCOTT of Georgia, Mr. GARRETT, Mr. 

FINCHER, Mr. WESTMORELAND, Mr. SMITH of Texas, Mr. MCCAUL, Mr. 

CRAWFORD, Mr. ROONEY, Mr. OLSON, Mr. SCALISE, Mr. GOHMERT, Mr. 

STIVERS, Mr. FLORES, Mr. BOUSTANY, Mr. BARROW of Georgia, Mr. 

ROKITA, and Mr. STUTZMAN) submitted the following resolution; which 

was referred to the Committee on Financial Services 

RESOLUTION 

Affirming that private equity plays an important role in 

growing and strengthening United States businesses 

throughout all sectors of the economy and in every State 

and congressional district and that it has fostered significant investment in the United States economy. 

Whereas private equity and growth capital is an industry that 

partners with pensions, foundations, and endowments to 

invest over the long term in promising companies in need 

of a turnaround and poised for growth; 


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•HRES 702 IH 

Whereas private equity invested more than $433,000,000,000 

in United States-based businesses last year and more 

than $4,100,000,000,000 over the past 10 years; 

Whereas the cornerstone of the private equity business model 

is growing and strengthening companies over the long 

term to create stronger businesses and return value to investors; 

Whereas the private equity partnerships help bring together 

management expertise with investment capital; 

Whereas low taxes on long-term capital gains is a fundamental part of fostering long-term investment in the 

United States, and private equity relies on long-term capital gains to incentivize investment; 

Whereas private equity funds invest in a diverse set of industries and sectors of the United States economy, including 

manufacturing, health care, information technology, business services, energy, and others; 

Whereas private equity investment drives economic growth 

throughout the Nation and helps United States businesses compete globally; 

Whereas 17,700 private equity-owned businesses are based in 

the United States and employ more than 7,500,000 people worldwide; 

Whereas most private equity investment spans between 3 and 

7 years; 

Whereas public pension funds’ median 10-year annualized returns on investments in private equity outperform all 

other asset classes, including public equity, real estate, 

and fixed income; 


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Whereas policymakers should treat all similarly situated partnerships, such as private equity, venture capital, and real 

estate, equally; 

Whereas tax policy should incentivize capital access, investment, and innovation; 

Whereas appropriately taxing capital gains is fundamental to 

many business partnerships, including private equity 

partnerships; 

Whereas the key criterion for capital gains treatment is if the 

taxpayer has made an entrepreneurial investment of capital, expertise, or both in a capital asset; 

Whereas private equity general partners develop business 

plans, hire and manage senior corporate executives, and 

participate in the ongoing corporate governance for the 

firms their funds invest in; 

Whereas the gains of a private equity fund are a direct result 

of the significant expertise invested by the general partners and these gains have always been appropriately 

taxed as capital gains for all partners; 

Whereas characterizing a carried interest as ordinary income 

will discourage the formation of private equity partnerships and reduce the entrepreneurial risk-taking necessary to build businesses; and 

Whereas private equity firms are essential to a healthy, growing United States economy and private equity investments can unlock economic value, transform industries, 

and put the Nation back to work: Now, therefore, be it 

1 Resolved, That the House of Representatives affirms 

2 that private equity plays an important role in growing and 

3 strengthening United States businesses throughout all secVerDate Mar 15 2010 23:18 Aug 01, 2014 Jkt 039200 PO 00000 Frm 00003 Fmt 6652 Sfmt 6201 E:\BILLS\HR702.IH HR702

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•HRES 702 IH 

1 tors of the economy and in every State and congressional 

2 district and that it has fostered significant investment in 

3 the United States economy. 

Æ 


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