I 
118TH CONGRESS 
1ST SESSION 
H. R. 580 
To establish a small business and domestic production recovery investment 
facility, and for other purposes. 
IN THE HOUSE OF REPRESENTATIVES 
JANUARY 26, 2023 
Ms. TENNEY introduced the following bill; which was referred to the 
Committee on Small Business 
A BILL 
To establish a small business and domestic production 
recovery investment facility, 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 ‘‘American Innovation 
and Manufacturing Act’’. 
SEC. 2. SMALL BUSINESS INVESTMENT COMPANY PRO-
GRAM. 
(a) IN GENERAL.—Part A of title III of the Small 
Business Investment Act of 1958 (15 U.S.C. 681 et seq.) 
is amended— 
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(1) 
in 
section 
302(a)(1) 
(15 
U.S.C. 
682(a)(1))— 
(A) in subparagraph (A), by striking ‘‘or’’ 
at the end; 
(B) in subparagraph (B), by striking the 
period at the end and inserting ‘‘; or’’; and 
(C) by adding at the end the following: 
‘‘(C) $20,000,000, adjusted every 5 years 
for inflation, with respect to each licensee au-
thorized or seeking authority to sell bonds to 
Administration as a participating investment 
company under section 321.’’; and 
(2) by adding at the end the following: 
‘‘SEC. 321. SMALL BUSINESS AND DOMESTIC PRODUCTION 
RECOVERY INVESTMENT FACILITY. 
‘‘(a) DEFINITIONS.—In this section: 
‘‘(1) ELIGIBLE SMALL BUSINESS CONCERN.— 
The term ‘eligible small business concern’— 
‘‘(A) means a small business concern that 
is a manufacturing business that is assigned a 
North American Industry Classification System 
code beginning with 31, 32, or 33 at the time 
at which the small business concern receives an 
investment from a participating investment 
company under the facility; and 
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‘‘(B) does not include an entity described 
in section 7(a)(37)(A)(iv)(III) of the Small 
Business 
Act 
(15 
U.S.C. 
636(a)(37)(A)(iv)(III)). 
‘‘(2) FACILITY.—The term ‘facility’ means the 
facility established under subsection (b). 
‘‘(3) FUND.—The term ‘Fund’ means the fund 
established under subsection (h). 
‘‘(4) PARTICIPATING INVESTMENT COMPANY.— 
The term ‘participating investment company’ means 
a small business investment company approved 
under subsection (d) to participate in the facility. 
‘‘(5) PROTE´GE´
INVESTMENT
COMPANY.—The 
term ‘prote´ge´ investment company’ means a small 
business investment company that— 
‘‘(A) is majority managed by new, inexperi-
enced, or otherwise underrepresented fund man-
agers; and 
‘‘(B) elects and is selected by the Adminis-
tration to participate in the pathway-prote´ge´ 
program under subsection (g). 
‘‘(6) SMALL
BUSINESS
CONCERN.—The term 
‘small business concern’ has the meaning given the 
term in section 3(a) of the Small Business Act (15 
U.S.C. 632(a)). 
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‘‘(b) ESTABLISHMENT.— 
‘‘(1) FACILITY.—The Administrator shall estab-
lish and carry out a facility to increase resiliency in 
the manufacturing supply chain of eligible small 
business concerns by providing financial assistance 
to participating investment companies that facilitate 
equity financings to eligible small business concerns 
in accordance with this section. 
‘‘(2) ADMINISTRATION OF FACILITY.—The fa-
cility shall be administered by the Administrator act-
ing through the Associate Administrator described in 
section 201. 
‘‘(c) APPLICATIONS.— 
‘‘(1) IN GENERAL.—Any small business invest-
ment company may submit to the Administrator an 
application to participate in the facility. 
‘‘(2) REQUIREMENTS
FOR
APPLICATION.—An 
application to participate in the facility shall include 
the following: 
‘‘(A) A business plan describing how the 
applicant intends to make successful equity in-
vestments in eligible small business concerns. 
‘‘(B) Information regarding the relevant 
investment qualifications and backgrounds of 
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the individuals responsible for the management 
of the applicant. 
‘‘(C) A description of the extent to which 
the applicant meets the selection criteria under 
subsection (d)(2). 
‘‘(3) EXCEPTIONS TO APPLICATION FOR NEW 
LICENSEES.—Not later than 90 days after the date 
of enactment of this section, the Administrator shall 
reduce requirements for applicants applying to oper-
ate as a participating investment company under 
this section in order to encourage the participation 
of new small business investment companies in the 
facility under this section, which may include the re-
quirements established under part 107 of title 13, 
Code of Federal Regulations, or any successor regu-
lation, relating to— 
‘‘(A) the approval of initial management 
expenses; 
‘‘(B) the management ownership diversity 
requirement; 
‘‘(C) the disclosure of general compen-
satory practices and fee structures; or 
‘‘(D) any other requirement that the Ad-
ministrator determines to be an obstacle to 
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achieving the purposes described in this para-
graph. 
‘‘(d) SELECTION
OF PARTICIPATING INVESTMENT 
COMPANIES.— 
‘‘(1) DETERMINATION.— 
‘‘(A) IN GENERAL.—Except as provided in 
paragraph (3), not later than 60 days after the 
date on which the Administrator receives an ap-
plication under subsection (c), the Adminis-
trator shall— 
‘‘(i) make a final determination to ap-
prove or disapprove such applicant to par-
ticipate in the facility; and 
‘‘(ii) transmit the determination to the 
applicant in writing. 
‘‘(B) COMMITMENT
AMOUNT.—Except as 
provided in paragraph (3), at the time of ap-
proval of an applicant, the Administrator shall 
make a determination of the amount of the 
commitment that may be awarded to the appli-
cant under this section. 
‘‘(2) SELECTION CRITERIA.—In making a de-
termination under paragraph (1), the Administrator 
shall consider— 
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‘‘(A) the probability that the investment 
strategy of the applicant will successfully repay 
any financial assistance provided by the Admin-
istration, including the probability of a return 
significantly in excess thereof; 
‘‘(B) the probability that the investments 
made by the applicant will— 
‘‘(i) provide capital to eligible small 
business concerns; or 
‘‘(ii) create or preserve jobs in the 
United States; 
‘‘(C) the probability that the applicant will 
meet the objectives in the business plan of the 
applicant, including the financial goals, and, if 
applicable, the pathway-prote´ge´ program in ac-
cordance with subsection (g); and 
‘‘(D) the probability that the applicant will 
assist eligible small business concerns in achiev-
ing profitability. 
‘‘(3) APPROVAL
OF
PARTICIPATING
INVEST-
MENT COMPANIES.— 
‘‘(A) PROVISIONAL APPROVAL.— 
‘‘(i) IN
GENERAL.—Notwithstanding 
paragraph (1), with respect to an applica-
tion submitted by an applicant to operate 
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as a participating investment company 
under this section, the Administrator may 
provide provisional approval for the appli-
cant in lieu of a final determination of ap-
proval and determination of the amount of 
the commitment under that paragraph. 
‘‘(ii) PURPOSE.—The purpose of a 
provisional approval under clause (i) is 
to— 
‘‘(I) encourage applications from 
investment companies with an invest-
ment mandate from the committed 
private market capital of the invest-
ment company that does not conform 
to the requirements described in this 
section at the time of application; 
‘‘(II) allow the applicant to more 
effectively raise capital commitments 
in the private markets by referencing 
the intent of the Administrator to 
award the applicant a commitment; 
and 
‘‘(III) allow the applicant to more 
precisely request the desired amount 
of commitment pending the securing 
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of capital from private market inves-
tors. 
‘‘(iii) LIMIT
ON
PERIOD
OF
THE 
TIME.—The period between a provisional 
approval under clause (i) and the final de-
termination of approval under paragraph 
(1) shall not exceed 12 months. 
‘‘(e) COMMITMENTS AND SBIC BONDS.— 
‘‘(1) IN
GENERAL.—The Administrator may, 
out of amounts available in the Fund, purchase or 
commit to purchase from a participating investment 
company 1 or more accruing bonds that include eq-
uity features as described in this subsection. 
‘‘(2) BOND TERMS.—A bond purchased by the 
Administrator from a participating investment com-
pany under this subsection shall have the following 
terms and conditions: 
‘‘(A) TERM AND INTEREST.— 
‘‘(i) IN GENERAL.—The bond shall be 
issued for a term of not less than 15 years 
and shall bear interest at a rate deter-
mined by the Administrator of not more 
than 2 percent. 
‘‘(ii) ACCRUAL OF INTEREST.—Inter-
est on the bond shall accrue and shall be 
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payable in accordance with subparagraph 
(D). 
‘‘(iii) PREPAYMENT.—The bond shall 
be prepayable without penalty after the 
end of the 1-year period beginning on the 
date on which the bond was purchased. 
‘‘(B) PROFITS.— 
‘‘(i) IN
GENERAL.—The Administra-
tion shall be entitled to receive a share of 
the profits net of any profit sharing per-
formance compensation of the participating 
investment company equal to the quotient 
obtained by dividing— 
‘‘(I) one-third of the commitment 
that the participating investment com-
pany is approved for under subsection 
(d); by 
‘‘(II) the commitment approved 
under subsection (d) plus the regu-
latory capital of the participating in-
vestment company at the time of ap-
proval under that subsection. 
‘‘(ii) DETERMINATION
OF
PERCENT-
AGE.—The share to which the Administra-
tion is entitled under clause (i)— 
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‘‘(I) shall be determined at the 
time of approval under subsection (d); 
and 
‘‘(II) without the approval of the 
Administration, shall not be revised, 
including to reflect subsequent dis-
tributions of profits, returns of cap-
ital, or repayments of bonds, or other-
wise. 
‘‘(C) 
PROFIT
SHARING
PERFORMANCE 
COMPENSATION.— 
‘‘(i) RECEIPT BY ADMINISTRATION.— 
The Administration shall receive a share of 
profits of not more than 2 percent, which 
shall be deposited into the Fund and be 
available to make commitments under this 
subsection. 
‘‘(ii) RECEIPT
BY
MANAGERS.—The 
managers of the participating investment 
company may receive a maximum profit 
sharing performance compensation of 25 
percent minus the share of profits paid to 
the Administration under clause (i). 
‘‘(D) PROHIBITION ON DISTRIBUTIONS.— 
No distributions on capital, including profit dis-
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tributions, shall be made by the participating 
investment company to the investors or man-
agers of the participating investment company 
until the Administration has received payment 
of all accrued interest on the bond committed 
under this section. 
‘‘(E) REPAYMENT OF PRINCIPAL.—Except 
as described in subparagraph (F), repayments 
of principal of the bond of a participating in-
vestment company shall be— 
‘‘(i) made at the same time as returns 
of private capital; and 
‘‘(ii) in amounts equal to the pro rata 
share of the Administration of the total 
amount being repaid or returned at such 
time. 
‘‘(F) LIQUIDATION
OR
DEFAULT.—Upon 
any liquidation event or default, as defined by 
the Administration, any unpaid principal or ac-
crued interest on the bond shall— 
‘‘(i) have a priority over all equity of 
the participating investment company; and 
‘‘(ii) be paid before any return of eq-
uity or any other distributions to the inves-
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tors or managers of the participating in-
vestment company. 
‘‘(3) AMOUNT
OF
COMMITMENTS
AND
PUR-
CHASES.— 
‘‘(A) MAXIMUM AMOUNT.—The maximum 
amount of outstanding bonds and commitments 
to purchase bonds for any participating invest-
ment company under the facility shall be the 
lesser of— 
‘‘(i) twice the amount of the regu-
latory capital of the participating invest-
ment company; or 
‘‘(ii) $200,000,000. 
‘‘(4) COMMITMENT PROCESS.—Commitments by 
the Administration to purchase bonds under the fa-
cility shall remain available to be sold by a partici-
pating investment company until the end of the 
fourth fiscal year following the year in which the 
commitment is made, subject to review and approval 
by the Administration based on regulatory compli-
ance, financial status, change in management, devi-
ation from business plan, and such other limitations 
as may be determined by the Administration by reg-
ulation or otherwise. 
‘‘(5) COMMITMENT CONDITIONS.— 
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‘‘(A) IN GENERAL.—As a condition of re-
ceiving a commitment under the facility, not 
less than 50 percent of amounts invested by the 
participating investment company shall be in-
vested in eligible small business concerns. 
‘‘(B) EXAMINATIONS.—In addition to the 
matters set forth in section 310(c), the Admin-
istration shall examine each participating in-
vestment company in such detail so as to deter-
mine whether the participating investment com-
pany has complied with the requirements under 
this subsection. 
‘‘(f) DISTRIBUTIONS AND FEES.— 
‘‘(1) DISTRIBUTION REQUIREMENTS.— 
‘‘(A) DISTRIBUTIONS.—As a condition of 
receiving a commitment under the facility, a 
participating investment company shall make 
all distributions to the Administrator in the 
same form and in a manner as are made to in-
vestors, or otherwise at a time and in a manner 
consistent with regulations or policies of the 
Administration. 
‘‘(B) ALLOCATIONS.—A participating in-
vestment company shall make allocations of in-
come, gain, loss, deduction, and credit to the 
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Administrator with respect to any outstanding 
bonds as if the Administrator were an investor. 
‘‘(2) 
FEES.—The 
Administrator 
may 
not 
charge fees for participating investment companies 
other than examination fees that are consistent with 
the license of the participating investment company. 
‘‘(3) BIFURCATION.—Losses on bonds issued by 
participating investment companies shall not be off-
set by fees or any other charges on debenture small 
business investment companies. 
‘‘(g) PROTE´GE´ PROGRAM.—The Administrator shall 
establish a pathway-prote´ge´ program in which a prote´ge´ 
investment company may receive technical assistance and 
program support from a participating investment company 
on a voluntary basis and without penalty for non-partici-
pation. 
‘‘(h) LOSS LIMITING FUND.— 
‘‘(1) IN GENERAL.—There is established in the 
Treasury a fund for making commitments and pur-
chasing bonds with equity features under the facility 
and receiving capital returned by participating in-
vestment companies. 
‘‘(2) USE OF FUNDS.—Amounts appropriated 
to the Fund or deposited in the Fund under para-
graph (3) shall be available to the Administrator, 
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without further appropriation, for making commit-
ments and purchasing bonds under the facility and 
expenses and payments, excluding administrative ex-
penses, relating to the operations of the Adminis-
trator under the facility. 
‘‘(3) DEPOSITING OF AMOUNTS.— 
‘‘(A) IN GENERAL.—All amounts received 
by the Administrator from a participating in-
vestment company relating to the facility, in-
cluding any moneys, property, or assets derived 
by the Administrator from operations in con-
nection with the facility, shall be deposited in 
the Fund. 
‘‘(B) PERIOD OF AVAILABILITY.—Amounts 
deposited under subparagraph (A) shall remain 
available until expended. 
‘‘(i) APPLICATION OF OTHER SECTIONS.—To the ex-
tent not inconsistent with requirements under this section, 
the Administrator may apply sections 309, 311, 312, 313, 
and 314 to activities under this section and an officer, di-
rector, employee, agent, or other participant in a partici-
pating investment company shall be subject to the require-
ments under such sections. 
‘‘(j) AUTHORIZATION OF APPROPRIATIONS.—There 
is authorized to be appropriated for the first fiscal year 
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beginning after the date of enactment of this part 
$10,000,000,000 to carry out the facility. Amounts appro-
priated pursuant to this subsection shall remain available 
until the end of the second fiscal year beginning after the 
date of enactment of this section.’’. 
(b) APPROVAL OF BANK-OWNED, NON-LEVERAGED 
APPLICANTS.—Section 301(c)(2) of the Small Business 
Investment Act of 1958 (15 U.S.C. 681(c)(2)) is amend-
ed— 
(1) in subparagraph (B), in the matter pre-
ceding clause (i), by striking ‘‘Within’’ and inserting 
‘‘Except as provided in subparagraph (C), within’’; 
and 
(2) by adding at the end the following: 
‘‘(C) EXCEPTION FOR BANK-OWNED, NON- 
LEVERAGED
APPLICANTS.—Notwithstanding 
subparagraph (B), not later than 45 days after 
the date on which the Administrator receives a 
completed application submitted by a bank- 
owned, non-leveraged applicant in accordance 
with this subsection and in accordance with 
such requirements as the Administrator may 
prescribe by regulation, the Administrator 
shall— 
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‘‘(i) review the application in its en-
tirety; and 
‘‘(ii)(I) approve the application and 
issue a license for such operation to the 
applicant if the requirements of this sec-
tion are satisfied; or 
‘‘(II) disapprove the application and 
notify the applicant in writing of the dis-
approval.’’. 
(c) ELECTRONIC SUBMISSIONS.—Part A of title III 
of the Small Business Investment Act of 1958 (15 U.S.C. 
681 et seq.), as amended by subsection (a) of this section, 
is further amended by adding at the end the following: 
‘‘SEC. 322. ELECTRONIC SUBMISSIONS. 
‘‘The Administration shall permit any document sub-
mitted under this title, or pursuant to a regulation car-
rying out this title, to be submitted electronically, includ-
ing by permitting an electronic signature for any signature 
that is required on such a document.’’. 
Æ 
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