Small Business Investment Improvement Act of 2019

I 116TH CONGRESS 1ST SESSION H. R. 4944 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 HOUSE OF REPRESENTATIVES OCTOBER 31, 2019 Mr. BURCHETT introduced the following bill; which was referred to the Committee on Small Business 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 (1) in paragraph (2)— 9 VerDate Sep 11 2014 02:32 Nov 08, 2019 Jkt 099200 PO 00000 Frm 00001 Fmt 6652 Sfmt 6201 E:\BILLS\H4944.IH H4944 pamtmann on DSKBC07HB2PROD with BILLS 2 •HR 4944 IH (A) by amending subparagraph (A) to read 1 as follows: 2 ‘‘(A) STATUS.—The Administrator shall 3 provide an applicant with a written report de- 4 tailing the status of the application and any re- 5 quirements remaining for completion of the ap- 6 plication, including any external or internal 7 delays— 8 ‘‘(i) except as provided in clauses (ii) 9 and (iii), not later than 120 days after the 10 initial receipt by the Administrator of the 11 application; 12 ‘‘(ii) not later than 45 days after the 13 initial receipt, if the application is sub- 14 mitted by a repeat applicant or a non-le- 15 veraged, non-bank applicant; or 16 ‘‘(iii) not later than 25 days after the 17 initial receipt, if the application is sub- 18 mitted by a bank-owned applicant.’’; 19 (B) in subparagraph (B), in the matter 20 preceding clause (i), by striking ‘‘Within a rea- 21 sonable time after receiving’’ and inserting ‘‘Ex- 22 cept as provided in subparagraph (C), not later 23 than 240 days after the date on which the Ad- 24 ministrator receives’’; and 25 VerDate Sep 11 2014 02:32 Nov 08, 2019 Jkt 099200 PO 00000 Frm 00002 Fmt 6652 Sfmt 6201 E:\BILLS\H4944.IH H4944 pamtmann on DSKBC07HB2PROD with BILLS 3 •HR 4944 IH (C) by adding at the end the following: 1 ‘‘(C) EXCEPTIONS.— 2 ‘‘(i) REPEAT APPLICANTS; NON-LE- 3 VERAGED, NON-BANK APPLICANT.—Not- 4 withstanding subparagraph (B), not later 5 than 90 days after the date on which the 6 Administrator receives a completed appli- 7 cation submitted by a repeat applicant or 8 a non-leveraged, non-bank applicant in ac- 9 cordance with this subsection and in ac- 10 cordance with such requirements as the 11 Administrator may prescribe by regulation, 12 the Administrator shall— 13 ‘‘(I) review the application in its 14 entirety; and 15 ‘‘(II)(aa) approve the application 16 and issue a license for such operation 17 to the applicant if the requirements of 18 this section are satisfied; or 19 ‘‘(bb) disapprove the application 20 and notify the applicant in writing of 21 the disapproval. 22 ‘‘(ii) BANK-OWNED APPLICANTS.— 23 Notwithstanding subparagraph (B), not 24 later than 45 days after the date on which 25 VerDate Sep 11 2014 02:32 Nov 08, 2019 Jkt 099200 PO 00000 Frm 00003 Fmt 6652 Sfmt 6201 E:\BILLS\H4944.IH H4944 pamtmann on DSKBC07HB2PROD with BILLS 4 •HR 4944 IH the Administrator receives a completed ap- 1 plication submitted by a bank-owned appli- 2 cant in accordance with this subsection 3 and in accordance with such requirements 4 as the Administrator may prescribe by reg- 5 ulation, the Administrator shall— 6 ‘‘(I) review the application in its 7 entirety; and 8 ‘‘(II)(aa) approve the application 9 and issue a license for such operation 10 to the applicant if the requirements of 11 this section are satisfied; or 12 ‘‘(bb) disapprove the application 13 and notify the applicant in writing of 14 the disapproval.’’; 15 (2) in paragraph (3)— 16 (A) in subparagraph (A)— 17 (i) in clause (i), by striking ‘‘and’’ at 18 the end; 19 (ii) in clause (ii), by adding ‘‘and’’ at 20 the end; and 21 (iii) by adding at the end the fol- 22 lowing: 23 ‘‘(iii) the management of the appli- 24 cant has successfully passed Federal Bu- 25 VerDate Sep 11 2014 02:32 Nov 08, 2019 Jkt 099200 PO 00000 Frm 00004 Fmt 6652 Sfmt 6201 E:\BILLS\H4944.IH H4944 pamtmann on DSKBC07HB2PROD with BILLS 5 •HR 4944 IH reau of Investigation background checks 1 within the preceding 1-year period;’’; and 2 (B) in subparagraph (B)— 3 (i) in clause (ii), by striking ‘‘and’’ at 4 the end; 5 (ii) in clause (iii), by adding ‘‘and’’ at 6 the end; and 7 (iii) by adding at the end the fol- 8 lowing: 9 ‘‘(iv) the public interest of approving 10 or disapproving the applicant.’’; 11 (3) in paragraph (4)(A)— 12 (A) in clause (ii), by striking ‘‘and’’ at the 13 end; 14 (B) in clause (iii), by striking the period at 15 the end and inserting ‘‘; and’’; and 16 (C) by adding at the end the following: 17 ‘‘(iv) has successfully passed a Fed- 18 eral Bureau of Investigation background 19 check within the preceding 1-year period.’’; 20 and 21 (4) by adding at the end the following: 22 ‘‘(5) DEFINITIONS.—In this subsection— 23 ‘‘(A) the term ‘bank-owned applicant’ 24 means an applicant for a license to operate as 25 VerDate Sep 11 2014 02:32 Nov 08, 2019 Jkt 099200 PO 00000 Frm 00005 Fmt 6652 Sfmt 6201 E:\BILLS\H4944.IH H4944 pamtmann on DSKBC07HB2PROD with BILLS 6 •HR 4944 IH a small business investment company under this 1 Act that— 2 ‘‘(i) is a national bank or any member 3 bank of the Federal Reserve System or 4 nonmember insured bank; 5 ‘‘(ii) bears the same name as the fu- 6 ture small business investment company; 7 ‘‘(iii) is domestically domiciled; and 8 ‘‘(iv) has not had a license under this 9 Act revoked or involuntarily surrendered 10 during the 10-year period preceding the 11 date on which the application is submitted; 12 ‘‘(B) the term ‘non-leveraged, non-bank 13 applicant’ means an applicant for a license to 14 operate as a small business investment company 15 under this Act that is not bank-owned and that, 16 when operational, poses no risk to the Federal 17 Government; and 18 ‘‘(C) the term ‘repeat applicant’ means an 19 applicant for a license to operate as a small 20 business investment company under this Act 21 that— 22 ‘‘(i) has previously applied for and 23 been issued such a license; 24 VerDate Sep 11 2014 02:32 Nov 08, 2019 Jkt 099200 PO 00000 Frm 00006 Fmt 6652 Sfmt 6201 E:\BILLS\H4944.IH H4944 pamtmann on DSKBC07HB2PROD with BILLS 7 •HR 4944 IH ‘‘(ii) has 50 percent of the same man- 1 agement team with the 50 percent of the 2 same investment committee as when the 3 applicant operated as a small business in- 4 vestment company; 5 ‘‘(iii) is applying for the same or less 6 ratio leverage as when the applicant oper- 7 ated as a small business investment com- 8 pany; 9 ‘‘(iv) has substantially the same in- 10 vestment strategy as when the applicant 11 operated as a small business investment 12 company; 13 ‘‘(v) is not more than 50 percent larg- 14 er than when the applicant operated as a 15 small business investment company; 16 ‘‘(vi) has not less than 50 percent of 17 institutional limited partnerships returning 18 from the prior fund to invest in the new 19 small business investment company; and 20 ‘‘(vii) has not had any major findings 21 on examinations of the prior fund.’’. 22 Æ VerDate Sep 11 2014 02:32 Nov 08, 2019 Jkt 099200 PO 00000 Frm 00007 Fmt 6652 Sfmt 6301 E:\BILLS\H4944.IH H4944 pamtmann on DSKBC07HB2PROD with BILLS