Small Business Investment Improvement Act of 2019

II 116TH CONGRESS 1ST SESSION S. 1975 To require the Small Business Administration to issue licenses under the Small Business Investment Act of 1958 within particular time frames, and for other purposes. IN THE SENATE OF THE UNITED STATES JUNE 26, 2019 Mr. RISCH (for himself, Mr. CRAPO, Mrs. CAPITO, Mr. YOUNG, Ms. DUCKWORTH, Mr. BOOKER, and Mr. SCOTT of South Carolina) intro- duced the following bill; which was read twice and referred to the Com- mittee on Small Business and Entrepreneurship A BILL To require the Small Business Administration to issue li- censes under the Small Business Investment Act of 1958 within particular time frames, and for other purposes. Be it enacted by the Senate and House of Representa- 1 tives of the United States of America in Congress assembled, 2 SECTION 1. SHORT TITLE. 3 This Act may be cited as the ‘‘Small Business Invest- 4 ment Improvement Act of 2019’’. 5 SEC. 2. TIMELINES FOR ISSUANCE OF SBIC LICENSES. 6 Section 301(c) of the Small Business Investment Act 7 of 1958 (15 U.S.C. 681(c)) is amended— 8 VerDate Sep 11 2014 04:18 Jun 29, 2019 Jkt 089200 PO 00000 Frm 00001 Fmt 6652 Sfmt 6201 E:\BILLS\S1975.IS S1975 kjohnson on DSK79L0C42 with BILLS 2 •S 1975 IS (1) in paragraph (2)— 1 (A) by amending subparagraph (A) to read 2 as follows: 3 ‘‘(A) STATUS.—The Administrator shall 4 provide an applicant with a written report de- 5 tailing the status of the application and any re- 6 quirements remaining for completion of the ap- 7 plication, including any external or internal 8 delays— 9 ‘‘(i) except as provided in clauses (ii) 10 and (iii), not later than 120 days after the 11 initial receipt by the Administrator of the 12 application; 13 ‘‘(ii) not later than 45 days after the 14 initial receipt, if the application is sub- 15 mitted by a repeat applicant or a non-le- 16 veraged, non-bank applicant; or 17 ‘‘(iii) not later than 25 days after the 18 initial receipt, if the application is sub- 19 mitted by a bank-owned applicant.’’; 20 (B) in subparagraph (B), in the matter 21 preceding clause (i), by striking ‘‘Within a rea- 22 sonable time after receiving’’ and inserting ‘‘Ex- 23 cept as provided in subparagraph (C), not later 24 VerDate Sep 11 2014 04:18 Jun 29, 2019 Jkt 089200 PO 00000 Frm 00002 Fmt 6652 Sfmt 6201 E:\BILLS\S1975.IS S1975 kjohnson on DSK79L0C42 with BILLS 3 •S 1975 IS than 240 days after the date on which the Ad- 1 ministrator receives’’; and 2 (C) by adding at the end the following: 3 ‘‘(C) EXCEPTIONS.— 4 ‘‘(i) REPEAT APPLICANTS; NON-LE- 5 VERAGED, NON-BANK APPLICANT.—Not- 6 withstanding subparagraph (B), not later 7 than 90 days after the date on which the 8 Administrator receives a completed appli- 9 cation submitted by a repeat applicant or 10 a non-leveraged, non-bank applicant in ac- 11 cordance with this subsection and in ac- 12 cordance with such requirements as the 13 Administrator may prescribe by regulation, 14 the Administrator shall— 15 ‘‘(I) review the application in its 16 entirety; and 17 ‘‘(II)(aa) approve the application 18 and issue a license for such operation 19 to the applicant if the requirements of 20 this section are satisfied; or 21 ‘‘(bb) disapprove the application 22 and notify the applicant in writing of 23 the disapproval. 24 VerDate Sep 11 2014 04:18 Jun 29, 2019 Jkt 089200 PO 00000 Frm 00003 Fmt 6652 Sfmt 6201 E:\BILLS\S1975.IS S1975 kjohnson on DSK79L0C42 with BILLS 4 •S 1975 IS ‘‘(ii) BANK-OWNED APPLICANTS.— 1 Notwithstanding subparagraph (B), not 2 later than 45 days after the date on which 3 the Administrator receives a completed ap- 4 plication submitted by a bank-owned appli- 5 cant in accordance with this subsection 6 and in accordance with such requirements 7 as the Administrator may prescribe by reg- 8 ulation, the Administrator shall— 9 ‘‘(I) review the application in its 10 entirety; and 11 ‘‘(II)(aa) approve the application 12 and issue a license for such operation 13 to the applicant if the requirements of 14 this section are satisfied; or 15 ‘‘(bb) disapprove the application 16 and notify the applicant in writing of 17 the disapproval.’’; 18 (2) in paragraph (3)— 19 (A) in subparagraph (A)— 20 (i) in clause (i), by striking ‘‘and’’ at 21 the end; 22 (ii) in clause (ii), by adding ‘‘and’’ at 23 the end; and 24 VerDate Sep 11 2014 04:18 Jun 29, 2019 Jkt 089200 PO 00000 Frm 00004 Fmt 6652 Sfmt 6201 E:\BILLS\S1975.IS S1975 kjohnson on DSK79L0C42 with BILLS 5 •S 1975 IS (iii) by adding at the end the fol- 1 lowing: 2 ‘‘(iii) the management of the appli- 3 cant has successfully passed Federal Bu- 4 reau of Investigation background checks 5 within the preceding 1-year period;’’; and 6 (B) in subparagraph (B)— 7 (i) in clause (ii), by striking ‘‘and’’ at 8 the end; 9 (ii) in clause (iii), by adding ‘‘and’’ at 10 the end; and 11 (iii) by adding at the end the fol- 12 lowing: 13 ‘‘(iv) the public interest of approving 14 or disapproving the applicant.’’; 15 (3) in paragraph (4)(A)— 16 (A) in clause (ii), by striking ‘‘and’’ at the 17 end; 18 (B) in clause (iii), by striking the period at 19 the end and inserting ‘‘; and’’; and 20 (C) by adding at the end the following: 21 ‘‘(iv) has successfully passed a Fed- 22 eral Bureau of Investigation background 23 check within the preceding 1-year period.’’; 24 and 25 VerDate Sep 11 2014 04:18 Jun 29, 2019 Jkt 089200 PO 00000 Frm 00005 Fmt 6652 Sfmt 6201 E:\BILLS\S1975.IS S1975 kjohnson on DSK79L0C42 with BILLS 6 •S 1975 IS (4) by adding at the end the following: 1 ‘‘(5) DEFINITIONS.—In this subsection— 2 ‘‘(A) the term ‘bank-owned applicant’ 3 means an applicant for a license to operate as 4 a small business investment company under this 5 Act that— 6 ‘‘(i) is a national bank or any member 7 bank of the Federal Reserve System or 8 nonmember insured bank; 9 ‘‘(ii) bears the same name as the fu- 10 ture small business investment company; 11 ‘‘(iii) is domestically domiciled; and 12 ‘‘(iv) has not had a license under this 13 Act revoked or involuntarily surrendered 14 during the 10-year period preceding the 15 date on which the application is submitted; 16 ‘‘(B) the term ‘non-leveraged, non-bank 17 applicant’ means an applicant for a license to 18 operate as a small business investment company 19 under this Act that is not bank-owned and that, 20 when operational, poses no risk to the Federal 21 Government; and 22 ‘‘(C) the term ‘repeat applicant’ means an 23 applicant for a license to operate as a small 24 VerDate Sep 11 2014 04:18 Jun 29, 2019 Jkt 089200 PO 00000 Frm 00006 Fmt 6652 Sfmt 6201 E:\BILLS\S1975.IS S1975 kjohnson on DSK79L0C42 with BILLS 7 •S 1975 IS business investment company under this Act 1 that— 2 ‘‘(i) has previously applied for and 3 been issued such a license; 4 ‘‘(ii) has 50 percent of the same man- 5 agement team with the 50 percent of the 6 same investment committee as when the 7 applicant operated as a small business in- 8 vestment company; 9 ‘‘(iii) is applying for the same or less 10 ratio leverage as when the applicant oper- 11 ated as a small business investment com- 12 pany; 13 ‘‘(iv) has substantially the same in- 14 vestment strategy as when the applicant 15 operated as a small business investment 16 company; 17 ‘‘(v) is not more than 50 percent larg- 18 er than when the applicant operated as a 19 small business investment company; 20 ‘‘(vi) has not less than 50 percent of 21 institutional limited partnerships returning 22 from the prior fund to invest in the new 23 small business investment company; and 24 VerDate Sep 11 2014 04:18 Jun 29, 2019 Jkt 089200 PO 00000 Frm 00007 Fmt 6652 Sfmt 6201 E:\BILLS\S1975.IS S1975 kjohnson on DSK79L0C42 with BILLS 8 •S 1975 IS ‘‘(vii) has not had any major findings 1 on examinations of the prior fund.’’. 2 Æ VerDate Sep 11 2014 04:18 Jun 29, 2019 Jkt 089200 PO 00000 Frm 00008 Fmt 6652 Sfmt 6301 E:\BILLS\S1975.IS S1975 kjohnson on DSK79L0C42 with BILLS