This bill changes parts of the Small Business Investment Act of 1958. It changes what counts when a Small Business Investment Company (SBIC) asks for leverage. The bill would let certain investments be excluded from the calculation of a company’s outstanding leverage. Those investments include money put into small businesses located in low-income or rural areas, small manufacturers, and small businesses in certain covered technology categories. The bill also changes several numeric leverage limits and adds annual inflation adjustments to those dollar limits. The bill narrows what counts as private funds for leverage approval by excluding money obtained from federal, state, or local governments, while explicitly allowing some pension plans, foundations, endowments, and university trusts for that approval purpose.
If enacted, SBICs could exclude some investments in rural, low-income, covered technology, or small manufacturing businesses from their leverage limits. The bill changes how much leverage an SBIC can have in certain cases and sets specific dollar caps for companies and commonly controlled companies. It makes those dollar caps subject to yearly inflation adjustments. The bill also says an investment is eligible for exclusion only if it is made after the bill becomes law.
No publicly available information on the federal budgetary cost of this bill. The bill text does change numeric limits and caps, including: a specified dollar cap of $175,000,000 for certain companies, a combined cap of $350,000,000 for commonly controlled companies, and an exclusion cap equal to the lesser of 50 percent of private capital or $125,000,000. The bill requires annual adjustments of those dollar amounts using the Consumer Price Index, with an initial adjustment based on earlier dates. The CPI adjustment does not apply to SBICs authorized to issue accrual debentures.
No publicly available information.
No publicly available information.