I 
113TH CONGRESS 
1ST SESSION 
H. R. 30 
To amend the Small Business Investment Act of 1958, to provide for a 
small business early-stage investment program, and for other purposes. 
IN THE HOUSE OF REPRESENTATIVES 
JANUARY 3, 2013 
Ms. VELA´ZQUEZ introduced the following bill; which was referred to the Com-
mittee on Small Business, and in addition to the Committee on Ways and 
Means, for a period to be subsequently determined by the Speaker, in 
each case for consideration of such provisions as fall within the jurisdic-
tion of the committee concerned 
A BILL 
To amend the Small Business Investment Act of 1958, to 
provide for a small business early-stage investment pro-
gram, and for other purposes. 
Be it enacted by the Senate and House of Representa-
tives of the United States of America in Congress assembled, 
SECTION 1. SHORT TITLE. 
This Act may be cited as the ‘‘Small Business Invest-
ment Enhancement and Tax Relief Act’’. 
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TITLE 
I—SMALL 
BUSINESS 
EARLY-STAGE 
INVESTMENT 
PROGRAM 
SEC. 101. SMALL BUSINESS EARLY-STAGE INVESTMENT 
PROGRAM. 
Title III of the Small Business Investment Act of 
1958 (15 U.S.C. 681 et seq.) is amended by adding at 
the end the following: 
‘‘PART D—SMALL BUSINESS EARLY-STAGE 
INVESTMENT PROGRAM 
‘‘SEC. 399A. ESTABLISHMENT OF PROGRAM. 
‘‘The Administrator shall establish and carry out an 
early-stage investment program (hereinafter referred to in 
this part as the ‘program’) to provide equity investment 
financing to support early-stage small businesses in ac-
cordance with this part. 
‘‘SEC. 399B. ADMINISTRATION OF PROGRAM. 
‘‘The program shall be administered by the Adminis-
trator acting through the Associate Administrator de-
scribed under section 201. 
‘‘SEC. 399C. APPLICATIONS. 
‘‘(a) IN GENERAL.—Any existing or newly formed in-
corporated body, limited liability company, or limited part-
nership organized and chartered or otherwise existing 
under Federal or State law for the purpose of performing 
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the functions and conducting the activities contemplated 
under the program and any manager of any small business 
investment company may submit to the Administrator an 
application to participate in the program. 
‘‘(b) REQUIREMENTS FOR APPLICATION.—An appli-
cation to participate in the program shall include the fol-
lowing: 
‘‘(1) A business plan describing how the appli-
cant intends to make successful venture capital in-
vestments in early-stage small businesses and direct 
capital to small business concerns in targeted indus-
tries or other business sectors. 
‘‘(2) Information regarding the relevant venture 
capital investment qualifications and backgrounds of 
the individuals responsible for the management of 
the applicant. 
‘‘(3) A description of the extent to which the 
applicant meets the selection criteria under section 
399D. 
‘‘(c) APPLICATIONS FROM MANAGERS
OF SMALL 
BUSINESS INVESTMENT COMPANIES.—The Administrator 
shall establish an abbreviated application process for ap-
plicants that are managers of small business investment 
companies that are licensed under section 301 and that 
are applying to participate in the program. Such abbre-
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viated process shall incorporate a presumption that such 
managers satisfactorily meet the selection criteria under 
paragraphs (3) and (5) of section 399D(b). 
‘‘SEC. 399D. SELECTION OF PARTICIPATING INVESTMENT 
COMPANIES. 
‘‘(a) IN GENERAL.—Not later than 90 days after the 
date on which the Administrator receives an application 
from an applicant under section 399C, the Administrator 
shall make a determination to conditionally approve or dis-
approve such applicant to participate in the program and 
shall transmit such determination to the applicant in writ-
ing. A determination to conditionally approve an applicant 
shall identify all conditions necessary for a final approval 
and shall provide a period of not less than one year for 
satisfying such conditions. 
‘‘(b) SELECTION CRITERIA.—In making a determina-
tion under subsection (a), the Administrator shall consider 
each of the following: 
‘‘(1) The likelihood that the applicant will meet 
the goals specified in the business plan of the appli-
cant. 
‘‘(2) The likelihood that the investments of the 
applicant will create or preserve jobs, both directly 
and indirectly. 
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‘‘(3) The character and fitness of the manage-
ment of the applicant. 
‘‘(4) The experience and background of the 
management of the applicant. 
‘‘(5) The extent to which the applicant will con-
centrate investment activities on early-stage small 
businesses. 
‘‘(6) The likelihood that the applicant will 
achieve profitability. 
‘‘(7) The experience of the management of the 
applicant with respect to establishing a profitable in-
vestment track record. 
‘‘(8) The extent to which the applicant will con-
centrate investment activities on small business con-
cerns in targeted industries. 
‘‘(c) FINAL APPROVAL.—For each applicant provided 
a conditional approval under subsection (a), the Adminis-
trator shall provide final approval to participate in the 
program not later than 90 days after the date the appli-
cant satisfies the conditions specified by the Administrator 
under such subsection or, in the case of applicants whose 
partnership or management agreements conform to mod-
els approved by the Administrator, the Administrator shall 
provide final approval to participate in the program not 
later than 30 days after the date the applicant satisfies 
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the conditions specified under such subsection. If an appli-
cant provided conditional approval under subsection (a) 
fails to satisfy the conditions specified by the Adminis-
trator in the time period designated under such sub-
section, the Administrator shall revoke the conditional ap-
proval. 
‘‘SEC. 399E. EQUITY FINANCINGS. 
‘‘(a) IN GENERAL.—The Administrator may make 
one or more equity financings to a participating invest-
ment company. 
‘‘(b) EQUITY FINANCING AMOUNTS.— 
‘‘(1) NON-FEDERAL
CAPITAL.—An equity fi-
nancing made to a participating investment company 
under the program may not be in an amount that 
exceeds the amount of the capital of such company 
that is not from a Federal source and that is avail-
able for investment on or before the date on which 
an equity financing is drawn upon. Such capital may 
include legally binding commitments with respect to 
capital for investment. 
‘‘(2) LIMITATION ON AGGREGATE AMOUNT.— 
The aggregate amount of all equity financings made 
to a participating investment company under the 
program may not exceed $100,000,000. 
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