Rural Capital Access Act
This bill increases federally backed leverage, or investments, available to small businesses in rural areas through Small Business Administration (SBA) programs. Specifically, the bill (1) reduces restrictions on federally backed leverage for small business investment companies (SBICs) investing in small businesses located in rural areas, and (2) allows the SBA to extend as leverage to rural business investment companies certain unexpended amounts intended for SBICs.
The bill also establishes an interagency working group comprised of the SBA, the Department of Agriculture, and industry stakeholders to develop administrative and legislative recommendations to improve program coordination and capital access in rural areas.
[Congressional Bills 117th Congress]
[From the U.S. Government Publishing Office]
[H.R. 5521 Introduced in House (IH)]
<DOC>
117th CONGRESS
1st Session
H. R. 5521
To amend the Small Business Investment Act of 1958 to provide
opportunities to rural business investment companies, and for other
purposes.
_______________________________________________________________________
IN THE HOUSE OF REPRESENTATIVES
October 8, 2021
Mr. Joyce of Ohio (for himself and Mr. Golden) introduced the following
bill; which was referred to the Committee on Small Business, and in
addition to the Committee on Agriculture, 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 Investment Act of 1958 to provide
opportunities to rural business investment companies, 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 ``Rural Capital Access Act''.
SEC. 2. DEFINITIONS.
In this Act--
(1) the term ``Administration'' means the Small Business
Administration;
(2) the term ``Administrator'' means the Administrator of
the Administration;
(3) the term ``appropriate committees of Congress'' means--
(A) the Committee on Small Business and
Entrepreneurship of the Senate;
(B) the Committee on Agriculture, Nutrition, and
Forestry of the Senate;
(C) the Committee on Small Business of the House of
Representatives; and
(D) the Committee on Agriculture of the House of
Representatives;
(4) the term ``rural business investment company'' has the
meaning given the term in section 384A of the Consolidated Farm
and Rural Development Act (7 U.S.C. 2009cc);
(5) the term ``Secretary'' means the Secretary of
Agriculture; and
(6) the term ``working group'' means the interagency
working group established under section 4(a).
SEC. 3. RURAL BUSINESS INVESTMENT.
(a) In General.--The Small Business Investment Act of 1958 (15
U.S.C. 661 et seq.) is amended--
(1) in part A of title III (15 U.S.C. 681 et seq.)--
(A) in section 303(b)(2) (15 U.S.C. 683(b)(2)), by
adding at the end the following:
``(E) Investments in rural areas.--
``(i) Definition.--In this subparagraph,
the term `rural area' has the meaning given the
term in section 343(a) of the Consolidated Farm
and Rural Development Act (7 U.S.C. 1991(a)).
``(ii) Additional leverage.--
``(I) In general.--In calculating
the outstanding leverage of a company
for the purposes of subparagraph (A),
the Administrator shall not include the
amount of the cost basis of any equity
investment made by the company in a
smaller enterprise located in a rural
area if the Administrator, after
performing an appropriate evaluation,
determines that such an exclusion will
not result in additional risk to the
Administration or the Federal
Government.
``(II) Limitation.--The amount
excluded under subclause (I) for a
company shall not exceed $25,000,000 in
any fiscal year.'';
(B) in section 308(g)(3) (15 U.S.C. 687(g)(3))--
(i) in subparagraph (D), by striking
``and'' at the end;
(ii) in subparagraph (E), by striking the
period at the end and inserting ``; and''; and
(iii) by adding at the end the following:
``(F) the total number of rural business investment
companies, as defined in section 321(a), that received leverage
from the Administration under section 321 in the previous year,
including the amount of that leverage that each such rural
business investment company received.'';
(C) in section 310(d)(1)(A) (15 U.S.C.
687b(d)(1)(A)), by inserting ``(including each rural
business investment company that receives leverage
under section 321)'' after ``Each licensee''; and
(D) by adding at the end the following:
``SEC. 321. RURAL BUSINESS INVESTMENT COMPANIES.
``(a) Definitions.--In this section--
``(1) the term `covered amounts' means, with respect to a
fiscal year, the amounts made available for that fiscal year to
grant leverage under this part to small business investment
companies;
``(2) the term `rural business investment company' has the
meaning given the term in section 384A of the Consolidated Farm
and Rural Development Act (7 U.S.C. 2009cc); and
``(3) the term `Secretary' means the Secretary of
Agriculture.
``(b) Leverage.--
``(1) In general.--Subject to paragraph (2), if the
Administration determines under subsection (c) that the
Administration will be unable to expend all of the covered
amounts for a particular fiscal year, the Administration shall
expend those unexpended covered amounts for that fiscal year to
grant leverage to rural business investment companies for the
purposes described in this part if, with respect to that fiscal
year, the Secretary determines that the Secretary is unable to
grant leverage to rural business investment companies in a
manner that is sufficient to satisfy the leverage needs of
those rural business investment companies.
``(2) Conditions.--With respect to leverage granted by the
Administration to a rural business investment company under
paragraph (1)--
``(A) the amount of the leverage made available
shall be subject to the limitations under section
303(b)(2);
``(B) for the purposes of subparagraph (A), any
leverage granted by the Secretary to the rural business
investment company under the program carried out under
subtitle H of the Consolidated Farm and Rural
Development Act (7 U.S.C. 2009cc et seq.) shall be
included when determining the maximum amount of
outstanding leverage that may be made available to the
rural business investment company under this section;
and
``(C) the Administration, in consultation with the
Secretary, shall--
``(i) impose such terms and conditions with
respect to the leverage that the Administration
and the Secretary determine to be appropriate;
and
``(ii) in developing the terms and
conditions described in clause (i)--
``(I) ensure, to the maximum extent
practicable, that those terms and
conditions are not--
``(aa) duplicative of other
requirements applicable to
rural business investment
companies; or
``(bb) otherwise
unnecessary; and
``(II) take into consideration how
rural business investment companies
that have been issued a license by the
Secretary under section 384D(e) of the
Consolidated Farm and Rural Development
Act (7 U.S.C. 2009cc-3(e)) before the
date of enactment of this section could
qualify to receive that leverage.
``(c) Internal Evaluation.--Not later than June 1 of each year, the
Administration shall perform an evaluation to determine whether the
Administration will be unable to expend all of the covered amounts for
the fiscal year in which the evaluation is made.''; and
(2) in section 503(g) (15 U.S.C. 697(g)), by inserting ``,
and with respect to leverage granted under section 321,'' after
``retained by the Administration under this section''.
(b) SBA Requirements.--
(1) Establishment of application process.--Not later than
180 days after the date of enactment of this Act, the
Administrator, in consultation with the Secretary, shall
establish a process through which a rural business investment
company may apply for leverage granted under section 321 of the
Small Business Investment Act of 1958, as added by subsection
(a) of this section.
(2) Update to rules.--Not later than 180 days after the
date of enactment of this Act, and in addition to the process
established under paragraph (1), the Administrator shall make
any updates to the rules of the Administration that are
necessary as a result of this section and the amendments made
by this section.
SEC. 4. INTERAGENCY WORKING GROUP.
(a) Establishment.--Not later than 180 days after the date of
enactment of this Act, the Administrator, in consultation with the
Secretary, shall establish an interagency working group to develop--
(1) administrative recommendations for improving the
coordination between the Administration and the Department of
Agriculture in administering the program carried out under part
A of title III of the Small Business Investment Act of 1958 (15
U.S.C. 681 et seq.) and the program carried out under subtitle
H of the Consolidated Farm and Rural Development Act (7 U.S.C.
2009cc et seq.), respectively; and
(2) legislative recommendations for improving capital
access and investment in rural areas of the United States
through the programs described in paragraph (1), including by
increasing the number of licensees under those programs.
(b) Members.--
(1) In general.--The Administrator, in consultation with
the Secretary, shall appoint to the working group such
representatives from the Administration and the Department of
Agriculture, and such non-Federal industry stakeholders, as the
Administrator, in consultation with the Secretary, determines
to be appropriate.
(2) Compensation.--No member of the working group may
receive any compensation by reason of the service of the member
on the working group.
(c) Report to Congress.--Not later than 180 days after the date on
which the working group is established under subsection (a), the
working group shall submit to the appropriate committees of Congress a
report that contains--
(1) the administrative actions that the Administration and
the Department of Agriculture should take to make the
improvements described in paragraph (1) of that subsection; and
(2) the legislative recommendations described in paragraph
(2) of that subsection.
(d) Termination.--The working group shall terminate upon submission
of the report required under subsection (c).
(e) Implementation of Recommendations.--Not later than 90 days
after the date on which the working group submits the report required
under subsection (c), the Administration and the Department of
Agriculture shall take the administrative actions described in
paragraph (1) of that subsection.
(f) Inapplicability of Federal Advisory Committee Act.--The Federal
Advisory Committee Act (5 U.S.C. App.) shall not apply with respect to
the working group or the activities of the working group.
<all>
Introduced in House
Introduced in House
Referred to the Committee on Small Business, and in addition to the Committee on Agriculture, 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.
Referred to the Committee on Small Business, and in addition to the Committee on Agriculture, 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.
Referred to the Subcommittee on Commodity Exchanges, Energy, and Credit.
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