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[Congressional Bills 119th Congress]
[From the U.S. Government Publishing Office]
[S. 3171 Introduced in Senate (IS)]
<DOC>
119th CONGRESS
1st Session
S. 3171
To waive the guarantee fee for certain business loans made to veterans
and spouses of veterans, and for other purposes.
_______________________________________________________________________
IN THE SENATE OF THE UNITED STATES
November 10, 2025
Mr. Markey (for himself and Mrs. Shaheen) introduced the following
bill; which was read twice and referred to the Committee on Small
Business and Entrepreneurship
_______________________________________________________________________
A BILL
To waive the guarantee fee for certain business loans made to veterans
and spouses of veterans, 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 ``Veteran Entrepreneurship Empowerment
Act''.
SEC. 2. FINDINGS.
Congress finds the following:
(1) According to the D'Aniello Institute for Veterans and
Military Families August 2025 report entitled ``A Framework for
Advancing and Strengthening the Veteran Entrepreneur
Ecosystem''--
(A) veterans are more likely to own businesses than
non-veterans;
(B) veteran-owned businesses are less likely to
close or fail than non-veteran owned businesses; and
(C) the top barrier to entrepreneurship listed by
veteran and military spouse entrepreneurs is a lack of
access to capital or financing.
(2) According to the Federal Reserve's 2025 Small Business
Credit Survey--
(A) only 48 percent of majority veteran owned firms
reported having sufficient financing for their
businesses, compared to 57 percent of non-veteran owned
firms; and
(B) 25 percent of majority veteran owned firms, and
29 percent of partially veteran owned firms, were
denied financing compared to 20 percent of non-veteran
owned firms.
(3) According to the Government Accountability Office's
2025 report entitled ``Financial Literacy and Small Business
Lending, Resources Available to Military-Affiliated People''--
(A) frequent moves, transition from active duty,
and difficulties establishing credit and forming
business relationships present barriers to accessing
capital for veteran entrepreneurs; and
(B) veteran entrepreneurs often lack personal
startup funds or sufficient business income necessary
for accessing capital.
SEC. 3. FEE WAIVER.
(a) Small Business Act.--Section 7(a) of the Small Business Act (15
U.S.C. 636(a)) is amended--
(1) in paragraph (18)--
(A) in subparagraph (A), in the matter preceding
clause (i), by striking ``With respect'' and inserting
``Except as provided in subparagraph (C), with
respect''; and
(B) by adding at the end the following:
``(C) Exception.--
``(i) In general.--Notwithstanding
subparagraph (A), the Administration may not
collect a guarantee fee under subparagraph (A)
with respect to a loan guaranteed under this
subsection if--
``(I) the loan is not made under
paragraph (36) or (37);
``(II) the loan is made to a small
business concern owned by a veteran or
spouse of a veteran; and
``(III) the deferred participation
share of the total loan amount is not
more than $1,000,000.
``(ii) Definition.--In this subparagraph,
the term `veteran or spouse of a veteran'
means--
``(I) a veteran;
``(II) an individual who is
eligible to participate in the
Transition Assistance Program
established under section 1144 of title
10, United States Code;
``(III) a member of a reserve
component of the Armed Forces named in
section 10101 of title 10, United
States Code;
``(IV) the spouse of an individual
described in subclause (I), (II), or
(III); or
``(V) the surviving spouse (as
defined in section 101 of title 38,
United States Code) of an individual
described in subclause (I), (II), or
(III) who died while serving on active
duty or as a result of a disability
that is service-connected (as defined
in such section).''; and
(2) in paragraph (31)--
(A) by striking subparagraph (G); and
(B) by redesignating subparagraph (H) as
subparagraph (G).
(b) Small Business Investment Act of 1958.--
(1) In general.--Section 503 of the Small Business
Investment Act of 1958 (15 U.S.C. 697) is amended--
(A) in subsection (b)(7)--
(i) by redesignating subparagraphs (A) and
(B) as clauses (i) and (ii), respectively;
(ii) by striking ``with respect'' and
inserting ``(A) Except as provided in
subparagraph (B), with respect'';
(iii) in clause (i)(II), as so
redesignated, by striking ``clause (i)'' and
inserting ``subclause (I)''; and
(iv) by adding at the end the following:
``(B) Notwithstanding subparagraph (A), the Administration
may not assess or collect any ongoing guarantee fee under
subparagraph (A) with respect to a loan guaranteed under this
title if the loan is made--
``(i) by the Administration;
``(ii) to a small business concern owned by a
veteran or spouse of a veteran; and
``(iii) for not more than $1,000,000.'';
(B) in subsection (d)(3)--
(i) by striking ``The Administration
shall'' and inserting ``(A) Except as provided
in subparagraph (B), the Administration
shall''; and
(ii) by adding at the end the following:
``(B) Notwithstanding subparagraph (A), the Administration
may not assess or collect any ongoing guarantee fee under
subparagraph (A) with respect to a loan guaranteed under this
title if the loan is made--
``(i) by the Administration;
``(ii) to a small business concern owned by a
veteran or spouse of a veteran; and
``(iii) for not more than $1,000,000.''; and
(C) in subsection (i)--
(i) by striking ``Two-Year Waiver of Fees--
The'' and inserting the following: ``waiver of
fees.--
``(1) Two-year waiver of fees.--The''; and
(ii) by adding at the end the following:
``(2) Waiver of fees for veterans.--For a loan of not more
than $1,000,000 made by the Administration to a small business
concern that is owned by a veteran or spouse of a veteran, such
small business concern shall be exempt from any up front
guarantee fee, as detailed in section 120.971(d)(1) of title
13, Code of Federal Regulations, or any successor
regulation.''.
(2) Conforming amendments.--The Small Business Investment
Act of 1958 (15 U.S.C. 661 et seq.) is amended--
(A) in section 103 (15 U.S.C. 662)--
(i) in paragraph (19), by striking ``and''
at the end;
(ii) in paragraph (20), by striking the
period at the end and inserting ``; and''; and
(iii) by adding at the end the following:
``(21) the term `veteran or spouse of a veteran' means--
``(A) a veteran;
``(B) an individual who is eligible to participate
in the Transition Assistance Program established under
section 1144 of title 10, United States Code;
``(C) a member of a reserve component of the Armed
Forces named in section 10101 of title 10, United
States Code;
``(D) the spouse of an individual described in
subparagraph (A), (B), or (C); or
``(E) the surviving spouse (as defined in section
101 of title 38, United States Code) of an individual
described in subparagraph (A), (B), or (C) who died
while serving on active duty or as a result of a
disability that is service-connected (as defined in
such section).''; and
(B) in section 503(b) (15 U.S.C. 697(b)), as
amended by paragraph (1)--
(i) in the matter preceding paragraph (1),
by striking ``unless--'' and inserting ``unless
the following criteria are met:'';
(ii) by striking the semicolon each place
it appears and inserting a period;
(iii) in paragraph (1), by striking ``such
debenture'' and inserting ``Such debenture'';
(iv) in paragraph (2), by striking
``necessary'' and inserting ``Necessary'';
(v) in paragraph (3), by striking ``the
interest rate'' and inserting ``The interest
rate'';
(vi) in paragraph (4), by striking ``the
aggregate'' and inserting ``The aggregate'';
(vii) in paragraph (5), by striking ``the
amount'' and inserting ``The amount''; and
(viii) in paragraph (6)--
(I) by striking ``the
Administration'' and inserting ``The
Administration''; and
(II) by striking ``and'' at the
end.
SEC. 4. EQUITY INJECTION.
(a) Small Business Act.--Section 7(a) of the Small Business Act (15
U.S.C. 636(a)) is amended by adding at the end the following:
``(38) Equity injection requirements.--
``(A) Equity injection defined.--In this paragraph,
the term `equity injection' means an investment by a
borrower in the applicable small business concern, in
the form and amount determined appropriate by the
Administrator.
``(B) Equity injection requirements for veterans.--
``(i) In general.--For a startup or change
of ownership loan with a deferred participation
share of the total amount that is not more than
$1,000,000 to a veteran or spouse of a veteran,
the minimum equity injection percentage
required under Standard Operating Procedure 50
10, version 8, effective on June 1, 2025, or
any successor guidance, shall be reduced by not
less than 5 percentage points.
``(ii) Required percentage.--If the
guidance described in clause (i) does not list
an exact percentage, the Administrator shall
include a requirement to reduce the percentage,
as calculated under the method used in the
guidance, for veterans or spouses of veterans
in accordance with clause (i).
``(C) Equity injection requirements generally.--The
Administrator shall encourage lenders to lower equity
injection requirements for loans to veterans or spouses
of veterans with a deferred participation share of the
total amount that is not more than $1,000,000.''.
(b) Small Business Investment Act of 1958.--
Section 502(3)(C) of the Small Business Investment Act of
1958 (15 U.S.C. 696(3)(C)) is amended--
(A) by redesignating clauses (i) through (iv) as
subclauses (I) through (IV), respectively, and
adjusting the margins accordingly;
(B) by inserting before subclause (I), as so
redesignated, the following:
``(i) for a small business concern that is
not owned by a veteran or spouse of a veteran--
'';
(C) in subclause (III), as so redesignated, by
striking ``clauses (i) and (ii)'' and inserting
``subclauses (I) and (II)''; and
(D) by adding at the end the following:
``(ii) for a loan to a small business
concern owned by a veteran or spouse of a
veteran--
``(I) at least 5 percent of the
total cost of the project financed, if
the small business concern has been in
operation for a period of 2 years or
less; or
``(II) at least 5 percent of the
total cost of the project financed, in
all other circumstances, at the
discretion of the development
company.''.
SEC. 5. REPORTS.
(a) Definitions.--In this section:
(1) Budget justification materials.--The term ``budget
justification materials'' has the meaning given that term in
section 3(b)(2) of the Federal Funding Accountability and
Transparency Act of 2006 (31 U.S.C. 6101 note);
(2) Covered person.--The term ``covered person'' means any
individual described in section 7(a)(18)(C)(ii) of the Small
Business Act (15 U.S.C. 636(a)(18)(C)(ii)).
(b) Lending Reports.--The Administrator of the Small Business
Administration shall collect and publish on the website of the
Administration data on the participation of covered persons in the loan
programs under section 7(a) of the Small Business Act (15 U.S.C.
636(a)) and title V of the Small Business Investment Act of 1958 (15
U.S.C. 695 et seq.).
(c) Entrepreneurial Development.--The Administrator of the Small
Business Administration shall collect and include in budget
justification materials submitted by the Administrator data on the
participation of covered persons in--
(1) the Service Corps of Retired Executives established
under section 8(b)(1)(B) of the Small Business Act (15 U.S.C.
636(a)) (15 U.S.C. 637(b)(1)(B));
(2) small business development centers, as defined in
section 3 of such Act (15 U.S.C. 632);
(3) women's business centers described in section 29 of
such Act (15 U.S.C. 656); and
(4) Veteran Business Outreach Centers described in section
32 of such Act (15 U.S.C. 657b).
<all>
Introduced in Senate
Read twice and referred to the Committee on Small Business and Entrepreneurship.
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