SBIC Advisory Committee Act of 2022
Bill: S.2521 | Sponsor: Sen. Cardin, Benjamin L. (D-MD)
Policy area: Commerce

Summary:
SBIC Advisory Committee Act of 2022
This bill requires the Small Business Administration (SBA) to establish an advisory committee to develop recommendations for expanding SBA assistance provided through Small Business Investment Companies (SBICs). SBICs are privately owned companies, licensed and regulated by the SBA, which invest in small businesses through debt and equity.
Composed in part of representatives of and partners with small businesses in low-income communities and rural areas, the advisory committee must make recommendations for SBICs to invest in (1) underlicensed and underfinanced states; and (2) small businesses owned by socially or economically disadvantaged individuals, veterans, and women.

To require the Administrator of the Small Business Administration to 
     establish an SBIC Advisory Committee, and for other purposes.

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

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``SBIC Advisory Committee Act of 
2022''.

SEC. 2. SBIC ADVISORY COMMITTEE.

    (a) Definitions.--In this section--
            (1) the terms ``Administration'' and ``Administrator'' mean 
        the Small Business Administration and the Administrator 
        thereof, respectively;
            (2) the term ``covered Members'' means the Chair and 
        Ranking Member of--
                    (A) the Committee on Small Business and 
                Entrepreneurship of the Senate; and
                    (B) the Committee on Small Business of the House of 
                Representatives;
            (3) the terms ``licensee'', ``small business investment 
        company'', and ``underlicensed State'' have the meanings given 
        those terms in section 301 of the Small Business Investment Act 
        of 1958 (15 U.S.C. 662);
            (4) the term ``low-income community'' has the meaning given 
        the term in section 45D(e) of the Internal Revenue Code of 
        1986;
            (5) the term ``rural area'' has the meaning given the term 
        by the Bureau of the Census;
            (6) the terms ``small business concern'', ``small business 
        concern owned and controlled by veterans'', and ``small 
        business concern owned and controlled by women'' have the 
        meanings given those terms in section 3 of the Small Business 
        Act (15 U.S.C. 632);
            (7) the term ``socially or economically disadvantaged 
        individual'' means a socially disadvantaged individual or 
        economically disadvantaged individual, as described in 
        paragraphs (5) and (6)(A), respectively, of section 8(a) of the 
        Small Business Act (15 U.S.C. 637(a));
            (8) the term ``underfinanced State'' means a State that has 
        below median financing, as determined by the Administrator; and
            (9) the term ``underserved community'' means--
                    (A) a HUBZone, as defined in section 31(b) of the 
                Small Business Act (15 U.S.C. 657a(b));
                    (B) a community that has been designated as an 
                empowerment zone or an enterprise community under 
                section 1391 of the Internal Revenue Code of 1986;
                    (C) a community that has been designated as a 
                promise zone by the Secretary of Housing and Urban 
                Development; and
                    (D) a community that has been designated as a 
                qualified opportunity zone under section 1400Z-1 of the 
                Internal Revenue Code of 1986.
    (b) Establishment.--The Administrator shall establish an SBIC 
Advisory Committee (referred to in this section as the ``Advisory 
Committee'') to convene outside experts to advise on the small business 
investment program under title III of the Small Business Investment Act 
of 1958 (15 U.S.C. 681 et seq.).
    (c) Composition.--
            (1) Membership.--The Advisory Committee shall be composed 
        of 16 members appointed by the Administrator as follows:
                    (A) The Associate Administrator of the Office of 
                Investment and Innovation of the Small Business 
                Administration, or another designee of the 
                Administrator as determined by the Administrator.
                    (B) 7 members with competence, interest, or 
                knowledge of the small business investment program 
                under title III of the Small Business Investment Act of 
                1958 (15 U.S.C. 681 et seq.), of whom--
                            (i) not fewer than 3 shall have a 
                        demonstrated record of expertise in investing 
                        in--
                                    (I) low-income communities;
                                    (II) communities that have been 
                                designated as qualified opportunity 
                                zones under section 1400Z-1 of the 
                                Internal Revenue Code of 1986;
                                    (III) businesses primarily engaged 
                                in research and development;
                                    (IV) manufacturers;
                                    (V) businesses primarily owned or 
                                controlled by individuals in 
                                underserved communities before 
                                receiving capital from the licensee;
                                    (VI) rural areas; or
                                    (VII) underfinanced States; and
                            (ii) not fewer than 1 member shall be a 
                        representative from a trade association for the 
                        small business investment program under title 
                        III of the Small Business Investment Act of 
                        1958 (15 U.S.C. 681 et seq.).
                    (C) 8 members appointed by the Administrator as 
                follows:
                            (i) 2 members shall be selected from among 
                        the individuals in the list submitted by the 
                        Chair of the Committee on Small Business and 
                        Entrepreneurship of the Senate under paragraph 
                        (2).
                            (ii) 2 members shall be selected from among 
                        the individuals in the list submitted by the 
                        Ranking Member of the Committee on Small 
                        Business and Entrepreneurship of the Senate 
                        under paragraph (2).
                            (iii) 2 members shall be selected from 
                        among the individuals in the list submitted by 
                        the Chair of the Committee on Small Business of 
                        the House of Representatives under paragraph 
                        (2).
                            (iv) 2 members shall be selected from among 
                        the individuals in the list submitted by the 
                        Ranking Member of the Committee on Small 
                        Business of the House of Representatives under 
                        paragraph (2).
            (2) Recommendations.--Not later than 30 days after the date 
        of enactment of this Act, each of the covered Members shall 
        provide to the Administrator a list of 3 candidates for 
        membership on the Advisory Committee, who shall be individuals 
        who hold a high-ranking position or senior leadership role, and 
        have no conflict of interest in the small business investment 
        program under title III of the Small Business Investment Act of 
        1958 (15 U.S.C. 681 et seq.), in--
                    (A) a relevant industry trade association;
                    (B) the investment industry with expertise in 
                pensions, endowments, and other non-banking 
                institutions;
                    (C) academia with expertise in the investment 
                industry; or
                    (D) a nonprofit institution, including one that 
                serves any of the entities described in subclauses (I) 
                through (VII) of paragraph (1)(B)(i).
            (3) Private sector members.--Not fewer than 2 and not more 
        than 4 of the members of the Advisory Committee shall be 
        investors in the private sector who--
                    (A) invest in small business concerns; and
                    (B) as of the date of appointment, do not 
                participate in the small business investment program 
                under title III of the Small Business Investment Act of 
                1958 (15 U.S.C. 681 et seq.).
            (4) Chairperson.--The Chairperson of the Advisory Committee 
        shall be the member of the Advisory Committee appointed under 
        paragraph (1)(A).
            (5) Period of appointment.--Members of the Advisory 
        Committee shall be appointed for the life of the Advisory 
        Committee.
            (6) Vacancies.--Any vacancy in the Advisory Committee shall 
        be filled in the same manner as the original appointment.
    (d) Deadline for Appointment.--Not later than 60 days after the 
date on which the covered Members provide the lists to the 
Administrator under subsection (c)(2), the Administrator shall--
            (1) appoint the members of the Advisory Committee; and
            (2) submit to Congress a list of the members so appointed.
    (e) Duties.--The Advisory Committee shall provide advice and 
recommendations to the Administrator--
            (1) concerning policy and program development and other 
        matters of significance concerning activities under the Small 
        Business Act (15 U.S.C. 631 et seq.) and the Small Business 
        Investment Act of 1958 (15 U.S.C. 661 et seq.), including 
        diversifying management teams or companies;
            (2) concerning incentives for small business investment 
        companies to--
                    (A) invest and locate in underlicensed States and 
                underfinanced States; and
                    (B) invest in small business concerns, including 
                those owned and controlled by socially or economically 
                disadvantaged individuals, small business concerns 
                owned and controlled by veterans, and small business 
                concerns owned and controlled by women;
            (3) concerning metrics of success, and benchmarks for 
        success, with respect to the goals described in this section; 
        and
            (4) concerning the impact of the small business investment 
        program under title III of the Small Business Investment Act of 
        1958 (15 U.S.C. 681 et seq.) on the private investment market, 
        including whether investments under the program compete with 
        the private sector.
    (f) Report.--Not later than 18 months after the date on which the 
Administrator establishes the Advisory Committee under subsection (b), 
the Advisory Committee shall submit to the Administrator, the Committee 
on Small Business and Entrepreneurship of the Senate, and the Committee 
on Small Business of the House of Representatives a report that 
includes the recommendations of the Advisory Committee described in 
subsection (e).
    (g) Termination.--The Advisory Committee shall terminate on the 
date on which the Advisory Committee submits the report required under 
subsection (f).

            Passed the Senate September 28, 2022.

            Attest:

                                                             Secretary.
117th CONGRESS

  2d Session

                                S. 2521

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