I 

115TH CONGRESS 

1ST SESSION H. R. 1186 

To amend the Small Business Act and the Small Business Investment Act 

of 1958 to increase the percentage of loans guaranteed for small business 

concerns that are manufacturers. 

IN THE HOUSE OF REPRESENTATIVES 

FEBRUARY 16, 2017 

Mr. RYAN of Ohio (for himself, Ms. KAPTUR, Mr. POCAN, and Ms. SLAUGHTER) introduced the following bill; which was referred to the Committee 

on Small Business, and in addition to the Committee on Science, Space, 

and Technology, for a period to be subsequently determined by the 

Speaker, in each case for consideration of such provisions as fall within 

the jurisdiction of the committee concerned 

A BILL 

To amend the Small Business Act and the Small Business 

Investment Act of 1958 to increase the percentage of 

loans guaranteed for small business concerns that are 

manufacturers. 

1 Be it enacted by the Senate and House of Representa2 tives of the United States of America in Congress assembled, 

3 SECTION 1. SHORT TITLE. 

4 This Act may be cited as the ‘‘Investing in America’s 

5 Small Manufacturers Act’’. 


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1 SEC. 2. FINDINGS. 

2 Congress finds the following: 

3 (1) In 2015, manufacturers contributed over 

4 $2,000,000,000,000 to the United States economy 

5 and accounted for over 12 percent of United States 

6 gross domestic product. 

7 (2) Manufacturing is one of the most important 

8 sectors of the United States economy with respect to 

9 employment. In 2013, the manufacturing sector sup10 ported over 17,000,000 indirect jobs in the United 

11 States, in addition to the 12,000,000 individuals 

12 who were directly employed in manufacturing. Com13 bined, these indirect and direct manufacturing jobs 

14 represented more than 20 percent of United States 

15 employment in 2013—more than any other sector. 

16 (3) While the United States has added over 

17 14,000,000 non-farm jobs since 2010, manufac18 turing job growth has lagged and added only ap19 proximately 900,000 jobs. Post-recession job recov20 ery averages since the 1940s indicate that another 

21 1,200,000 manufacturing jobs should have been cre22 ated during this period. 

23 (4) Small manufacturers are the backbone of 

24 the United States manufacturing industry, account25 ing for nearly half of all manufacturing jobs in the 

26 United States. Ensuring that small manufacturers 


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1 have adequate access to capital is critical to creating 

2 manufacturing jobs and the growth of the United 

3 States economy. 

4 (5) The 2015 Federal Reserve Small Business 

5 Credit Survey indicates that of the 52 percent of 

6 manufacturers that applied for financing during the 

7 survey period, 65 percent did so to expand their 

8 business or to pursue a new business opportunity. 

9 The survey also indicates that 42 percent of manu10 facturers received less financing than they requested, 

11 the primary result of which was delayed expansion 

12 of their business. 

13 (6) The loan guarantee programs of the Small 

14 Business Administration under section 7(a) of the 

15 Small Business Act (15 U.S.C. 636(a)) and title V 

16 of the Small Business Investment Act of 1958 (15 

17 U.S.C. 695 et seq.) encourage lenders to provide 

18 loans to creditworthy small businesses that would 

19 not otherwise obtain financing on reasonable terms 

20 and conditions and can serve as an excellent mecha21 nism by which to increase the availability of afford22 able credit to small manufacturers in the United 

23 States. 


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1 SEC. 3. SMALL MANUFACTURERS. 

2 (a) LOAN GUARANTEE PERCENTAGE.—Section 

3 7(a)(2) of the Small Business Act (15 U.S.C. 636(a)(2)) 

4 is amended— 

5 (1) in subparagraph (A), in the matter pre6 ceding clause (i), by striking ‘‘and (E)’’ and insert7 ing ‘‘(E), and (F)’’; and 

8 (2) by adding at the end the following: 

9 ‘‘(F) PARTICIPATION FOR MANUFACTUR10 ERS.— 

11 ‘‘(i) IN GENERAL.—In an agreement 

12 to participate in a loan on a deferred basis 

13 under this subsection for a small business 

14 concern assigned to a North American In15 dustry Classification System code for man16 ufacturing or that is designated by the Ad17 ministrator under clause (ii), the participa18 tion by the Administration shall be 90 per19 cent. 

20 ‘‘(ii) ADDITION OF ADVANCED MANU21 FACTURING SECTORS.—After submitting 

22 notice to the Committee on Small Business 

23 and Entrepreneurship of the Senate and 

24 the Committee on Small Business of the 

25 House of Representatives, the Adminis26 trator may designate a North American 


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1 Industry Classification System code for 

2 purposes of clause (i) if the Administrator 

3 determines the code— 

4 ‘‘(I) is not a manufacturing code 

5 under the North American Industry 

6 Classification System; and 

7 ‘‘(II) corresponds to a sector in 

8 which manufacturing is a considerable 

9 component of the operations of a 

10 small business concern, as determined 

11 by the Administrator, including ad12 vanced manufacturing.’’. 

13 (b) GUARANTEE FEE REDUCTION.—Section 7(a)(18) 

14 of the Small Business Act (15 U.S.C. 636(a)(18)) is 

15 amended— 

16 (1) in subparagraph (A), by striking ‘‘With re17 spect’’ and inserting ‘‘Except as provided in sub18 paragraph (C), with respect’’; and 

19 (2) by adding at the end the following: 

20 ‘‘(C) MANUFACTURERS.— 

21 ‘‘(i) IN GENERAL.—Subject to clause 

22 (ii), with respect to a loan guaranteed 

23 under this subsection for a small business 

24 concern described in paragraph (2)(F)(i)— 


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1 ‘‘(I) the Administration may not 

2 collect a guarantee fee under this 

3 paragraph for a loan of not more than 

4 $350,000; and 

5 ‘‘(II) for a loan of more than 

6 $350,000, the Administration shall 

7 collect a guarantee fee under this 

8 paragraph equal to 50 percent of the 

9 guarantee fee that the Administration 

10 would otherwise collect for the loan. 

11 ‘‘(ii) EXCEPTION.—The requirements 

12 of clause (i) shall not apply to loans made 

13 during a fiscal year if— 

14 ‘‘(I) the budget of the President 

15 for that fiscal year, submitted to Con16 gress under section 1105(a) of title 

17 31, United States Code, includes a 

18 cost for the program established 

19 under this subsection that is above 

20 zero; and 

21 ‘‘(II) the Administrator submits 

22 to Congress— 

23 ‘‘(aa) notice regarding the 

24 determination of cost described 

25 in subclause (I); and 


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1 ‘‘(bb) a detailed discussion 

2 indicating why not implementing 

3 clause (i) will cause the cost of 

4 the program established under 

5 this subsection to be not more 

6 than zero.’’. 

7 (c) ASSISTANCE THROUGH SBA PROGRAMS.—The 

8 Small Business Act (15 U.S.C. 631 et seq.) is amended— 

9 (1) in section 7(a) (15 U.S.C. 636(a)), by add10 ing at the end the following: 

11 ‘‘(35) ASSISTANCE FOR SMALL MANUFACTUR12 ERS.—The Administrator shall ensure that each dis13 trict office of the Administration provides training to 

14 small business concerns described in paragraph 

15 (2)(F)(i) in obtaining assistance under this sub16 section, including with respect to the application 

17 process and partnering with participating lenders 

18 under this subsection.’’; 

19 (2) in section 8 (15 U.S.C. 637), by striking 

20 subsection (c) and inserting the following: 

21 ‘‘(c) ASSISTANCE FOR SMALL MANUFACTURERS IN

22 SCORE PROGRAM.— 

23 ‘‘(1) DEFINITION.—In this subsection, the term 

24 ‘SCORE program’ means the Service Corps of ReVerDate Sep 11 2014 23:27 Feb 24, 2017 Jkt 069200 PO 00000 Frm 00007 Fmt 6652 Sfmt 6201 E:\BILLS\H1186.IH H1186

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1 tired Executives authorized under subsection 

2 (b)(1)(B). 

3 ‘‘(2) VOLUNTEERS.—Under the SCORE pro4 gram, the Administrator shall recruit volunteers to 

5 assist small business concerns described in section 

6 7(a)(2)(F)(i) in obtaining assistance under section 

7 7(a) and title V of the Small Business Investment 

8 Act of 1958 (15 U.S.C. 695 et seq.), including with 

9 respect to the application process and partnering 

10 with participating lenders under that section.’’; 

11 (3) in section 21(c)(3) (15 U.S.C. 648(c)(3))— 

12 (A) in subparagraph (S), by striking 

13 ‘‘and’’ at the end; 

14 (B) in subparagraph (T), by striking the 

15 period at the end and inserting ‘‘; and’’; and 

16 (C) by adding at the end the following: 

17 ‘‘(U) providing training to small business 

18 concerns described in section 7(a)(2)(F)(i) in 

19 obtaining assistance under section 7(a) and title 

20 V of the Small Business Investment Act of 

21 1958 (15 U.S.C. 695 et seq.), including with re22 spect to the application process and partnering 

23 with participating lenders under that section.’’; 

24 (4) in section 29(b) (15 U.S.C. 656(b))— 


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1 (A) in paragraph (2), by striking ‘‘and’’ at 

2 the end; 

3 (B) in paragraph (3), by striking the pe4 riod at the end and inserting ‘‘; and’’; and 

5 (C) by adding at the end the following: 

6 ‘‘(4) training to small business concerns owned 

7 and controlled by women that are small business 

8 concerns described in section 7(a)(2)(F)(i) in obtain9 ing assistance under section 7(a) and title V of the 

10 Small Business Investment Act of 1958 (15 U.S.C. 

11 695 et seq.), including with respect to the applica12 tion process and partnering with participating lend13 ers under that section.’’; and 

14 (5) in section 32 (15 U.S.C. 657b), by adding 

15 at the end the following: 

16 ‘‘(g) ASSISTANCE FOR SMALL MANUFACTURERS.— 

17 The Associate Administrator shall ensure that Veterans 

18 Business Outreach Centers assist small business concerns 

19 described in section 7(a)(2)(F)(i) in obtaining assistance 

20 under section 7(a) and title V of the Small Business In21 vestment Act of 1958 (15 U.S.C. 695 et seq.), including 

22 with respect to the application process and partnering with 

23 participating lenders under that section.’’. 

24 (d) PARTNERING WITH NIST.—The Small Business 

25 Administration and its resource partners may establish 


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1 partnerships with the Hollings Manufacturing Extension 

2 Partnership Program of the National Institute of Stand3 ards and Technology and its affiliated centers to facilitate 

4 outreach to small manufacturers in providing training and 

5 guidance with respect to the application process for loans 

6 guaranteed by the Administration. 

7 SEC. 4. DEVELOPMENT COMPANY DEBENTURES. 

8 (a) AMOUNT OF GUARANTEED DEBENTURE.—Sec9 tion 503(a) of the Small Business Investment Act of 1958 

10 (15 U.S.C. 697(a)) is amended by adding at the end the 

11 following: 

12 ‘‘(5)(A) Any debenture issued by a State or local de13 velopment company to a small manufacturer (as defined 

14 in section 501(e)(6)) with respect to which a guarantee 

15 is made under this subsection shall be in an amount equal 

16 to not more than 50 percent of the cost of the project 

17 with respect to which such debenture is issued. 

18 ‘‘(B) Subparagraph (A) shall not apply to debentures 

19 issued during a fiscal year if— 

20 ‘‘(i) the cost to the Federal Government of 

21 making guarantees under this section is above zero; 

22 and 

23 ‘‘(ii) the Administrator submits to Congress— 

24 ‘‘(I) notice regarding the determination of 

25 cost described in clause (i); and 


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1 ‘‘(II) a detailed discussion indicating why 

2 not implementing subparagraph (A) will cause 

3 the cost to the Federal Government of making 

4 guarantees under this section to be not more 

5 than zero.’’. 

6 (b) STARTUP SMALL MANUFACTURERS.—Section 

7 502(3)(C)(i) of the Small Business Investment Act of 

8 1958 (15 U.S.C. 696(3)(C)(i)) is amended by inserting 

9 ‘‘is not a small manufacturer (as defined in section 

10 501(e)(6)) and’’ after ‘‘small business concern’’. 

11 SEC. 5. FEDERAL LOAN GUARANTEES FOR INNOVATIVE 

12 TECHNOLOGIES IN MANUFACTURING. 

13 (a) TRANSFER OF EXISTING PROGRAM.—The Ste14 venson-Wydler Technology Innovation Act of 1980 (15 

15 U.S.C. 3701 et seq.) is amended— 

16 (1) by striking section 26 (15 U.S.C. 3721); 

17 and 

18 (2) by redesignating sections 27 and 28 (15 

19 U.S.C. 3722 and 3723) as sections 26 and 27, re20 spectively. 

21 (b) AUTHORITY OF SBA.— 

22 (1) DEFINITIONS.—In this subsection— 

23 (A) the term ‘‘Administrator’’ means the 

24 Administrator of the Small Business Adminis25 tration; 


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1 (B) the term ‘‘business loan programs of 

2 the Administration’’ means the programs under 

3 section 7(a) of the Small Business Act (15 

4 U.S.C. 636(a)) and title V of the Small Busi5 ness Investment Act of 1958 (15 U.S.C. 695 et 

6 seq.); and 

7 (C) the term ‘‘small manufacturer’’ means 

8 a business concern described in section 

9 7(a)(2)(F)(i) of the Small Business Act, as 

10 amended by this Act. 

11 (2) AUTHORIZATION.—To the extent the Ad12 ministrator determines that the assistance available 

13 to small manufacturers under section 26 of the Ste14 venson-Wydler Technology Innovation Act of 1980 

15 (15 U.S.C. 3721), as in effect on the day before the 

16 date of enactment of this Act, is not available under 

17 the business loan programs of the Administration, 

18 the Administrator shall ensure that the business 

19 loan programs of the Administration provide ade20 quate support for innovative technologies in manu21 facturing. 

22 (3) REPORTING.—The Administrator shall sub23 mit to the Committee on Small Business and Entre24 preneurship of the Senate and the Committee on 

25 Small Business of the House of Representatives a 


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1 report regarding any determination or activity of the 

2 Administrator under paragraph (2). 

3 (c) SAVINGS CLAUSE.—Any loan guarantee issued 

4 under section 26 of the Stevenson-Wydler Technology In5 novation Act of 1980 (15 U.S.C. 3721), as in effect on 

6 the day before the date of enactment of this Act, shall 

7 remain in full force and effect under the terms, and for 

8 the duration, of the loan guarantee agreement. 

Æ 


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