SOAR Act

Bill: 117-s-2631
Sponsor: full_name: Sen. Booker, Cory A. [D-NJ]
Introduced: 2021-08-05
Policy area: Commerce
Subjects: Business education

Business investment and capital

Correctional facilities and imprisonment

Disability and paralysis

Government information and archives

Indian social and development programs

Minority and disadvantaged businesses

Small business

Veterans' education, employment, rehabilitation

Women in business
Latest action: action_date: 2021-09-22
text: Committee on Small Business and Entrepreneurship. Hearings held.

Summaries:
action_date: 2021-08-05
action_desc: Introduced in Senate
text: <p><b>Startup Opportunity Accelerator Act of 2021 or the SOAR Act</b></p> <p>This bill requires the Small Business Administration to develop and implement a program to award cash grants of at least $1,000,000 to organizations that support new small businesses. These awards may be used for construction costs, space acquisition, and programmatic purposes, but they may not be used to provide capital or professional services to small businesses directly or through the subaward of funds.</p> <p> The organization must have the support of new small businesses as a primary purpose and be often classified as an accelerator. The term <i>accelerator</i> means an organization that (1) supports new businesses with a focus on technology, research, and development; (2) frequently provides, but is not exclusively designed to provide, seed investment in exchange for a small amount of equity; (3) works with a startup for a predetermined amount of time; (4) provides mentorship and instruction to scale businesses; or (5) offers startup capital or the opportunity to raise capital from outside investors.</p>

tv_txt: II 117th CONGRESS 1st Session S. 2631 IN THE SENATE OF THE UNITED STATES August 5, 2021 Mr. Booker (for himself and Ms. Hirono ) introduced the following bill; which was read twice and referred to the Committee on Small Business and Entrepreneurship A BILL To amend the Small Business Act to create a program to provide funding for organizations that support startup businesses in formation and early growth stages by providing entrepreneurs with resources and services to produce viable businesses, and for other purposes.

1. Short title This Act may be cited as the Startup Opportunity Accelerator Act of 2021 or the SOAR Act . 2. Findings Congress finds that— (1) startups have contributed greatly to the United States economy, with research showing that between 1982 and 2011, businesses 5 years or younger were responsible for nearly every net new job created; (2) startups face common challenges as they seek to transform their ideas into successful, high-growth businesses; (3) 4 metropolitan areas in 3 States—the San Francisco Bay Area, New York City, Boston, and Los Angeles—receive nearly 75 percent of all venture capital investment, which is a critical source of funding for high-growth startups; (4) of startups that receive venture capital funding, 2 percent are African-American-owned, 6 percent are Latino-owned, and only 13 percent are owned solely by women; (5) incubators and accelerators are new models of growth that drive innovation by connecting entrepreneurial individuals and teams to create viable business ventures and social initiatives; (6) incubators and accelerators support promising startups through partnerships, mentoring, and resources connecting them with seasoned entrepreneurs; (7) the goal of an incubator or an accelerator is to help create and grow young businesses by providing them with necessary financial, technical, and industry support and financial and technical services; and (8) startups offer unique opportunities for growth and development for women, minority, and veterans to become successful entrepreneurs and leaders in new and developed fields. 3. Growth accelerator fund competition The Small Business Act ( 15 U.S.C. 631 et seq. ) is amended— (1) by redesignating section 49 ( 15 U.S.C. 631 note) as section 50; and (2) by inserting after section 48 the following: 49. Growth accelerator fund competition (a) Definitions In this section— (1) the term disability has the meaning given the term in section 3 of the Americans with Disabilities Act of 1990 ( 42 U.S.C. 12102 ); (2) the term eligible entity means an organization— (A) that is located in the United States; (B) the primary purpose of which is to support new small business concerns; and (C) that is often classified as a growth accelerator; (3) the term growth accelerator means an organization that— (A) supports new business concerns with a focus on technology, research, and development; (B) frequently provides, but is not exclusively designed to provide, seed investment in exchange for a small amount of equity; (C) works with a new business concern for a predetermined amount of time; (D) provides mentorship and instruction to scale businesses; or (E) offers startup capital or the opportunity to raise capital from outside investors; (4) the term minority serving institution means— (A) an institution described in any of paragraphs (1) through (7) of section 371(a) of the Higher Education Act of 1965 ( 20 U.S.C. 1067q(a) ); or (B) a junior or community college, as that term is defined in section 312(f) of the Higher Education Act of 1965 ( 20 U.S.C. 1058(f) ); (5) the term new small business concern means a small business concern that has been in operation for not more than 5 years; and (6) the term State means any State of the United States, the District of Columbia, the Commonwealth of Puerto Rico, and any territory or possession of the United States. (b) Funding (1) In general Not later than 1 year after the date of enactment of this section, the Administrator shall develop and begin implementing a program to award cash grants of not less than $1,000,000 to eligible entities to support new small business concerns. (2) Use of funds A grant under this section— (A) may be used for construction costs, space acquisition, and programmatic purposes; and (B) may not be used to provide capital to new small business concerns directly or through the subaward of funds. (3) Disbursal of funds In disbursing funds under this section, the Administrator may use incremental or scheduled payments. (c) Application (1) In general An eligible entity desiring a grant under this section shall demonstrate that the eligible entity will use the grant to provide assistance to not less than 10 new small business concerns per year. (2) Requirements In soliciting applications and awarding grants to eligible entities under this section, the Administrator shall employ a streamlined and inclusive approach that— (A) widely publicizes funding opportunities to a broad audience, including through the use of digital resources such as the website of the Administration and social media; (B) utilizes an easily accessible submission process or platform; (C) shall make every effort to minimize— (i) the use of forms, detailed budgets, supporting documentation, or written submissions; and (ii) any other burdensome requirement; (D) focuses on solution-based approaches and results-based outcomes; (E) encourages innovation; and (F) allows proposals or pitches to be presented using various formats or media. (d) Criteria The Administrator shall establish criteria for a grant under this section that shall give priority to eligible entities that— (1) are providing or plan to provide to new small business concerns— (A) office, manufacturing, or warehouse space, including appropriate operations infrastructure; (B) access to capital either directly from the eligible entity (using amounts other than the amounts provided under the grant) or through guidance and contacts for acquiring capital from outside investors; (C) access to professional services either directly from the eligible entity (using amounts other than the amounts provided under the grant) or through guidance and contacts for acquiring professional services, including accounting and legal services; or (D) a formal structured mentorship or developmental program that assists new small business concerns with building business skills and competencies; or (2) if located within 20 miles of a minority serving institution, demonstrates a referral or programmatic relationship with that institution. (e) Considerations in choosing recipients In determining whether to award a grant under this section to an eligible entity, the Administrator shall take into account— (1) for eligible entities that have in operation a program to support new small business concerns, the record of the eligible entity in assisting new small business concerns, including, for each of the 3 full years before the date on which the eligible entity applies for a grant under this section— (A) the retention rate of new small business concerns in the program of the eligible entity; (B) the average period of participation by new small business concerns in the program of the eligible entity; (C) the total, average, and median capital raised by new small business concerns participating in the program of the eligible entity; and (D) the total, average, and median number of employees of new small business concerns participating in the program of the eligible entity; (2) for all eligible entities— (A) the number of new small business concerns assisted or anticipated to be assisted by the eligible entity; (B) the number of new small business concerns applying or anticipated to apply for assistance from the eligible entity; (C) whether the program of the eligible entity provides or would provide assistance to individuals in gender, racial, or ethnic groups underrepresented by existing programs to assist new small business concerns; and (D) other metrics determined appropriate by the Administrator; (3) the need in the geographic area to be served by the program to be carried out using the grant for additional assistance for new small business concerns, if the area has sufficient population density, as determined by the Administrator; (4) the level of experience of the entrepreneurial leadership of the eligible entity; and (5) the ability of the eligible entity to use and leverage local strengths, including human resources, infrastructure, and educational institutions. (f) Requirement To award grants to certain accelerators In order to promote diversity in entrepreneurship, the Administrator shall award not less than 50 percent of amounts appropriated for grants in a given fiscal year to— (1) accelerators located in an area described in subparagraph (A), (B), or (C) of section 31(b); and (2) accelerators for which not less than 50 percent of the small business concerns served by the accelerator are small business concerns— (A) owned and controlled by socially disadvantaged individuals or economically disadvantaged individuals, as defined in paragraphs (5) and (6)(A), respectively, of section 8(a); (B) owned and controlled by women; or (C) that are not less than 51 percent owned by one or more— (i) Native Americans; (ii) individuals participating in the Transition Assistance Program of the Department of Defense; (iii) individuals who— (I) served on active duty in any branch of the Armed Forces, including the National Guard and Reserves; and (II) were discharged or released from such service under conditions other than dishonorable; (iv) formerly incarcerated individuals; or (v) individuals with a disability. (g) Matching nonpublic funding An eligible entity receiving a grant under this section may obtain funds from a private individual or entity (including a for-profit or nonprofit entity) that are— (1) for the same purposes as a grant may be made under this section; and (2) used to carry out the program of the eligible entity carried out using the grant under this section. (h) Consequences of failure To abide by terms or conditions of grant or requirements of this section The Administrator shall notify each eligible entity receiving a grant under this section that failure to abide by the terms and conditions of the grant or the requirements of this section may, in the discretion of the Administrator and in addition to any other civil or criminal consequences, result in the Administrator withholding payments or ordering the eligible entity to return the grant funds. (i) Annual progress reporting by recipients of grant Each eligible entity receiving a grant under this section shall submit to the Administrator an annual report on the progress of the program carried out using the amounts received under the grant, including— (1) the number of new small business concerns participating in the program during each of the 3 years preceding the report; (2) the number of new small business concerns applying to participate in the program during each of the 3 years preceding the report; (3) the retention rate of new small business concerns in the program; (4) the average period of participation in the program by new small business concerns; (5) the total, average, and median capital raised by new small business concerns participating in the program; (6) the total, average, and median number of employees of new small business concerns participating in the program; (7) the number of new small business concerns— (A) owned and controlled by socially disadvantaged individuals or economically disadvantaged individuals, as defined in paragraphs (5) and (6)(A), respectively, of section 8(a); (B) owned and controlled by women; or (C) that are not less than 51 percent owned by one or more— (i) Native Americans; (ii) individuals participating in the Transition Assistance Program of the Department of Defense; (iii) individuals who— (I) served on active duty in any branch of the Armed Forces, including the National Guard and Reserves; and (II) were discharged or released from such service under conditions other than dishonorable; (iv) formerly incarcerated individuals; or (v) individuals with a disability; and (8) other metrics determined appropriate by the Administrator. (j) Reports to congress The Administrator shall submit to Congress an annual report on the program under this section, which shall include an assessment of the effectiveness of the program, including an assessment based on the metrics listed in subsection (i). (k) Coordination with other small business administration programs The Administrator shall take appropriate action to encourage eligible entities receiving a grant under this section to use and incorporate other programs of the Administration, such as small business development centers, small business investment companies, loans under section 7(a), assistance under title V of the Small Business Investment Act of 1958 ( 15 U.S.C. 695 et seq. ), and resource partners of the Administration, including women’s business centers and veteran’s business outreach centers. (l) Coordination with the Department of Veterans Affairs In consultation with the Secretary of Veteran Affairs, the Administrator shall make available outreach materials regarding the opportunities for veterans within the program under this section for distribution and display at local facilities of the Department of Veterans Affairs. (m) Listing on website The Administrator shall include a list of eligible entities receiving a grant under this section on the website of the Administration. (n) Authorization of appropriations There is authorized to be appropriated to the Administration $800,000,000, to remain available until expended, to carry out this section. .