House Small Business Committee

Chairman Chabot Votes in Favor of the Tax Cuts and Jobs Act

House Small Business Committee News - Thu, 11/16/2017 - 12:00am

WASHINGTON – Today, House Committee on Small Business Chairman Steve Chabot (R-OH) released the following statement following the House passage of H.R. 1, the Tax Cuts and Jobs Act:

 

“As Chairman of the House Committee on Small Business, I want to ensure the tax code works for our nation’s job creators, not against them. H.R. 1 will reduce taxes for small businesses from a top rate of almost 40 percent down to 25 percent, and includes an additional, lower tax rate of 9 percent for the smallest of small businesses. Additionally, it will create tens of thousands of jobs for the people of Ohio and across the country and allow Americans to keep more of their hard-earned paychecks.”

 

Federal Government and Small Businesses: Promoting Greater Information Sharing for Stronger Cybersecurity

House Small Business Committee News - Wed, 11/15/2017 - 11:00am

The Committee on Small Business will meet for a hearing titled, “Federal Government and Small Businesses: Promoting Greater Information Sharing for Stronger Cybersecurity.” The hearing is scheduled to begin at 11:00 A.M. on Wednesday, November 15, 2017 in Room 2360 of the Rayburn House Office Building.

Small businesses are prime targets for cyber attackers and the threat continues to grow. Unfortunately, small business owners face an uphill battle in protecting themselves from bad actors because they often lack the resources required to employ the best defenses.  As the federal government and private sector continue to take steps to strengthen small business cybersecurity, the lack of information sharing between federal and private partners poses a major hurdle to effectively combatting cyber attacks. The hearing will examine how federal agencies can encourage greater information sharing with small businesses and provide timely assistance and resources when a cyber attack on a small business occurs. Additionally, the hearing will examine the policies that discourage small businesses from engaging with federal agencies for cybersecurity assistance.

Attachments
1. Hearing Notice
2. Witness List

Witnesses
Mr. Rob Arnold
Founder & Chief Executive Officer
Threat Sketch, LLC
Winston-Salem, NC

Ms. Ola Sage
Chief Executive Officer
e-Management
Silver Spring, MD

Mr. Morgan Reed
President
ACT | The App Association
Washington, DC

Mr. Thomas Gann
Chief Public Policy Officer
McAfee, LLC
Reston, VA 

Promoting Greater Information Sharing for Stronger Cybersecurity

House Small Business Committee News - Wed, 11/15/2017 - 12:00am

WASHINGTON – Today, the House Committee on Small Business held a hearing to examine how federal agencies can encourage greater information sharing with small businesses and provide timely assistance and resources when a cyber attack on a small business occurs.

 “This Committee has heard from experts, government officials, and small business owners on numerous occasions that cyber threats remain a top concern for America’s small business community. Information sharing is a fundamental component for a strong and effective cybersecurity defense, not just for small businesses but for America’s network as a whole. The federal government must make every effort possible to ensure that small businesses have both the resources and the confidence they need to actively engage with the federal agencies tasked with protecting our critical infrastructure,said Chairman Chabot (R-OH).

Cyber Threats Remain a Top Concern for Small Businesses

While the federal government has made a serious effort to coordinate and distribute cyber security resources directly to small businesses, challenges still remain in ensuring that they are protected from cyber attacks.

“Small businesses are extremely resourceful. Having quality incident reporting and cyber intelligence flowing to the small business community lets us build solutions for ourselves. Our biggest challenge, in that regard, is collecting and aggregating data from a wide array of sources,” said Rob Arnold, CEO & Founder of Threat Sketch, LLC in Winston-Salem, NC.

“Recent ransomware attacks have been devastating with 1 in 5 companies forced to immediately shut down operations for three days and in some cases, more than two weeks, said Ola Sage, Founder and CEO of e-Management and Co-Founder and CEO of CyberRx in Silver Spring, MD. ”Solving this problem requires greater information sharing between the government and the SMB community to help companies better identify threats, protect their infrastructure, detect anomalies, respond to, and recover from significant cyber events.”

“In 2014, 71 percent of companies admitted they fell victim to a successful cyber-attack. Meanwhile, the amount of data online is expected to increase 50-fold by 2020, signaling accelerated tech innovation but also adding new attack vectors due to increased connectivity and a sweetening of the pot for potential cyber criminals. Cybersecurity risk management strategies must keep pace with this growing threat – a task that evolves as more online traffic and commerce is dedicated to the internet of things,” said Morgan Reed, President of ACT | The App Association in Washington, DC.

“We have to acknowledge the fact that for most small businesses, cybersecurity is an expense they don’t want to incur when they’re trying to simply make payroll and remain profitable,” said Thomas Gann, Chief Public Policy Officer of McAfee, LLC in Reston, VA.  “This doesn’t mean that small businesses don’t need or can’t benefit from cyber threat intelligence; they certainly can. But perhaps we should focus our discussion more on sharing a different kind of information – information that is more informative and educational right away.”

Chairman Chabot Applauds Small Business Legislation in NDAA

House Small Business Committee News - Tue, 11/14/2017 - 12:00am

WASHINGTON—Today, House Committee on Small Business Chairman Steve Chabot (R-OH) released the following statement regarding the passage of the FY2018 National Defense Authorization Act (NDAA) conference report:

“Not only does the NDAA include the largest pay increase for our nation’s armed forces, it also is a win for America’s 29 million small businesses,” said Chairman Steve Chabot. “Small businesses play a vital and indispensable role in providing for the common defense, and I thank both Chambers for recognizing their contribution to the safety of our homeland.”

Among other beneficial small business provisions, versions of the following bills were included in the FY2018 NDAA:

  • H.R. 1773, the Clarity for America’s Small Contractors Act of 2017, sponsored by Chairman Steve Chabot (R-OH), co-sponsored by Ranking Member Nydia Velázquez (D-NY)
  • H.R. 3294, the HUBZone Unification and Business Stability Act  of 2017, sponsored by Ranking Member Nydia Velázquez (D-NY) and Chairman Steve Chabot (R-OH)
  • H.R. 1597, the Commercial Market Representatives Clarification Act of 2017, sponsored by Rep. Dave Brat (R-VA), co-sponsored by Rep. Steve Knight (R-CA) and Rep. Stephanie Murphy (D-FL)
  • H.R. 1640, the Unifying Small Business Terminology Act of 2017, sponsored by Ranking Member Nydia Velázquez (D-NY)
  • H.R. 1693, the Improving Contract Procurement for Small Businesses through More Accurate Reporting Act of 2017, sponsored by Rep. Yvette Clarke (D-NY), co-sponsored by Rep. Brian Fitzpatrick (R-PA)
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Mid-Sized Businesses: Too Big to be Small and Too Small to be Big

House Small Business Committee News - Tue, 11/14/2017 - 12:00am

WASHINGTON—Today, Chairman Steve Chabot (R-OH) and the House Committee on Small Business held a bipartisan roundtable to hear from advanced small and mid-tier businesses and industry experts on the challenges to growth and success. 

 “After a small business has proven its success by growing out of its small size standard, it exists in a murky limbo – it is too large to benefit from small business set-asides, yet is too small to compete with billion dollar firms,” said Chairman Steve Chabot.  “Our goal is to learn more about what is happening to advanced small—or mid-tier—businesses.”

The roundtable provided a forum for Members to learn about this middle market and the disparities from small to mid-tier business owners, academia, trade organizations, and subject-matter experts.

Data on these mid-tier companies is minimal, but preliminary evidence shows these firms are limited to a few options: relegate themselves to subcontracting opportunities; sell the company to a larger firm; or try to compete in full and open markets. 

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ICYMI: Chairman Chabot Talks Veterans and Small Businesses in The Hill

House Small Business Committee News - Mon, 11/13/2017 - 12:00am

WASHINGTON – Last week, House Committee on Small Business Chairman Steve Chabot (R-OH) wrote an op-ed for the Hill on veterans starting small businesses once they return from the battlefield, and the tools they need to succeed.

When our nation’s military men and women return home after service, they not only deserve our gratitude, but often times need our help. Many who return do so with the dream of starting their own business. Not surprisingly, those who have served in the military already possess many of the same skills – such as leadership, discipline and fortitude - that make great entrepreneurs and business owners. Once they return, they just need the tools and resources to see their dream through,” said Chairman Chabot.

Chabot continued, “As Chairman of the House Committee on Small Business, I recognize how important it is to celebrate America’s veteran entrepreneurs and the contributions they have made to our economy. Each year, we do so during Veterans Small Business Week, particularly because the 2.5 million veteran-owned businesses in the U.S. hire more than 5 million employees.”

To continue reading the full article, click HERE.

ICYMI: Congress Should Finish Strong with Small Business Tax Cuts

House Small Business Committee News - Thu, 11/09/2017 - 12:00am

WASHINGTON- This week, Congressman Bill Johnson (R-OH) wrote an op-ed on why lawmakers need to finish the year strong by providing tax cuts for small businesses.

Here in Ohio, small businesses are an especially big deal. A whopping 99.6 percent of our companies are small businesses, according to figures from the U.S. Small Business Administration. They employ over two million Ohioans, making up 46 percent of all employees in-state. In the latest Kauffman Foundation rankings, Columbus and Cleveland both placed in the top-30 metro areas nationwide for entrepreneurial growth rates,” said Johnson.

Johnson continued,In the U.S. House of Representatives, the Small Business Committee is chaired by Ohio’s very own Rep. Steve Chabot. He’s well aware that small businesses – and the economic growth they provide – are being held back by onerous taxes.”

Click HERE to read the full article.

Additionally, in July Chairman Chabot sent a letter to the Ways and Means Committee requesting that small businesses have a voice in tax reform.  

Hiring More Heroes: A Review of SBA’s Office of Veterans Business Development

House Small Business Committee News - Wed, 11/08/2017 - 12:00am

WASHINGTON—Ahead of Veterans Day, Members of the House Committee on Small Business heard testimony from Ms. Barbara Carson, the Associate Administrator of the Office of Veterans Business Development at the United States Small Business Administration (SBA), on the tools and resources veterans can access to start or expand their small business.

Our nation’s veterans make extraordinary sacrifices, put their lives on the line, and keep our country safe. They are our fathers, mothers, siblings, and friends. They are our heroes,” said Chairman Steve Chabot (R-OH).

However, veteran employment levels have historically fallen behind those of their nonveteran counterparts. This is often due to the difficulties veterans face when transitioning from the military to the workforce. Research shows that veterans face many barriers to employment that their peers do not, such as potential employers’ difficulty in understanding a military resume or the result of a service-connected disability. We can, and must, do better for them,” Chairman Chabot continued.

From the Battlefield to the Boardroom

America’s armed forces not only defend and protect our nation, but also learn the skillset needed to operate successful businesses. The SBA’s Office of Veterans Business Development was established to bridge the gap that exists between veteran and nonveteran employment levels.

The SBA is dedicated to serving aspiring and existing veteran business owners. About 2.5 million businesses are majority-owned by veterans, and nearly all veteran-owned businesses are small businesses and contribute approximately 1.4 trillion dollars to the nation’s total sales/receipts per year,” said Barbara Carson. “Many veteran business owners have gained important skills and leadership abilities that are often directly relevant to business ownership.”

The significance of access to capital is one of the greatest challenges small businesses face,” said Chairman Steve Chabot (R-OH). “This is why the Ranking Member and I introduced the Veterans Entrepreneurship Act a couple years back which was signed into law by the President.” 

Rep. Trent Kelly (R-MS), asked, “Of all the SBA’s loan programs that are targeting veterans, which ones are most popular for our veteran entrepreneurs?”  To which Ms. Carson replied, “We have the most participation in the 7(a) loan program.”

How do you measure success? Does your department have goals? And if they do, what are the big goals? Where we measure in business, we improve on,” said Rep. Rod Blum (R-IA).

Ms. Carson replied, “We measure things such as business starts, capital acquired, but because of the mission assigned, it will be tougher for that group [veterans]. The results have been increased participation by 12 percent in the last three years, and 55,000 were trained by Veterans Business Outreach Centers (VBOCs).”

Several Members of the Committee on Small Business have served, or are still serving, in the military. Mr. Kelly (R-MS), Mr. Knight (R-CA), Mr. Bacon (R-NE), and Mr. Marshall (R-KS), have all served their country honorably both on the battlefield and in the halls of Congress.

Click here to view full video and here to read full testimony.

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Chairman Chabot Commends House Passage of Save Local Business Act

House Small Business Committee News - Wed, 11/08/2017 - 12:00am

WASHINGTON - Today, House Committee on Small Business Chairman Steve Chabot (R-OH) released the following statement upon House passage yesterday of H.R. 3441, the Save Local Business Act, legislation that will reverse an Obama-era scheme that threatens small businesses. Chairman Chabot is an original co-sponsor of the bill and, earlier this year, sent a letter to the House Education and Workforce Committee in support of H.R. 3441.

Small businesses have been hurting under this rule for years and it’s time we put an end to it. Under the new standard, a potential small business owner may avoid buying a franchise because of the risk of being punished for the actions of a franchiser. It has also created a lot of confusion and unnecessary challenges for job creators that just want to grow their companies,” said Chairman Chabot. “Today’s vote will restore certainty to America’s small business owners and their employees so they can continue to operate their businesses locally and independently.  Enacting this legislation will help ensure continued freedom for America’s best job creators.”

The Committee first held a roundtable in April 2015 on the emerging issue. NLRB then expanded its definition of the joint employer standard in August 2015. In March 2016, the Committee held a hearing titled, “Risky Business: Effects of New Joint Employer Standards for Small Firms” to examine the direct impact of the rule on small businesses.

To watch Chairman Chabot’s full remarks, click on the video below.

Investing in Small Businesses: The SBIC Program

House Small Business Committee News - Tue, 11/07/2017 - 10:00am

The Committee on Small Business Subcommittee on Agriculture, Energy, and Trade will meet for a hearing titled, “Investing in Small Businesses: The SBIC Program.” The hearing is scheduled to begin at 10:00 A.M. on Tuesday, November 7, 2017 in Room 2360 of the Rayburn House Office Building

This hearing will examine the United States Small Business Administration’s (SBA) Small Business Investment Company (SBIC) Program.  As the Committee continues to explore the issue of access to capital, this hearing will provide Members the opportunity to hear directly from participants in the SBIC Program.  

Attachments
1. Hearing Notice
2. Witness List

Witnesses

Mr. Brett Palmer
President
Small Business Investor Alliance
Washington, DC

Mr. Thies Kolln
Partner
Aavin Private Equity
Cedar Rapids, IA

Mr. Michael Painter
Managing Partner
Plexus Capital
Raleigh, NC

Investing in Small Businesses: The SBIC Program

House Small Business Committee News - Tue, 11/07/2017 - 10:00am

The Committee on Small Business Subcommittee on Agriculture, Energy, and Trade will meet for a hearing titled, “Investing in Small Businesses: The SBIC Program.” The hearing is scheduled to begin at 10:00 A.M. on Tuesday, November 7, 2017 in Room 2360 of the Rayburn House Office Building

This hearing will examine the United States Small Business Administration’s (SBA) Small Business Investment Company (SBIC) Program.  As the Committee continues to explore the issue of access to capital, this hearing will provide Members the opportunity to hear directly from participants in the SBIC Program.  

Attachments
1. Hearing Notice
2. Witness List 

Witnesses
Mr. Brett Palmer
President
Small Business Investor Alliance
Washington, DC 

Investing in Small Businesses: The SBIC Program

House Small Business Committee News - Tue, 11/07/2017 - 12:00am

WASHINGTON—Today, Members of the Subcommittee on Agriculture, Energy, and Trade heard from a panel of witnesses from all over the country who participate in the Small Business Administration’s (SBA) Small Business Investment Company (SBIC) Program.

As a way to inject more equity into the small business ecosystem to address the gap in long-term financing, the SBA created the Small Business Investment Company Program, also known as the SBIC Program, in 1958,” said Subcommittee Chairman Rod Blum (R-IA).Like many of the SBA’s financial programs…robust and thorough Congressional oversight is required to ensure taxpayer money is safeguarded and protected.

A Successful Private-Public Sector Solution   

The SBIC program is a vital source of capital for small businesses and is a leading example of how the federal government and the private sector can work together to grow the economy and create jobs.

“The program is effective and distinct because the private sector leads with its capital and investment expertise and then SBIC leverage follows to augment the impact of the private investment,” said Brett Palmer, President of the Small Business Investor Alliance in Washington, DC. “It is a mark of SBIC industry pride that the program continued to maintain its zero-subsidy throughout the Great Recession.”

“A hallmark of the SBIC Program is its rigorous licensing process for prospective SBIC funds, ensuring taxpayer protection and safeguarding the program’s reputation,” said Thies Kolln, Partner at Aavin Private Equity in Cedar Rapids, IA. “Because of our location and our firm’s investing principles, we have a particular impact on small businesses in Iowa. In our firm’s history, we have made 26 investments in Iowa small businesses, one as recently as the end of October.”

Our growth has been driven by doing more of the same investments in small businesses. We invested in 28 small businesses through our first SBIC fund and expect to invest in 40 – 50 small businesses over the life of Plexus Fund IV,” stated Michael Painter, Managing Partner at Plexus Capital in Raleigh, NC. “While many peers have found great success moving up market to serve larger companies, we have been intentional about staying focused on smaller businesses who have limited access to capital where we can make a meaningful impact on growth.”

The SBIC program is one of the most innovative, financially successful and well-structured government programs in existence,” said Mark Walsh, Managing Director at Ruxton Ventures in Chevy Chase, MD. “The license application and approval process is extraordinarily rigorous, and creates an efficient “filter” for mismanaged or ill-targeted funds from receiving taxpayer dollars.”

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House Small Business Committee Introduces Bipartisan Small Business Saturday Resolution

House Small Business Committee News - Fri, 11/03/2017 - 12:00am

WASHINGTON—Yesterday, Chairman Steve Chabot (R-OH) and Ranking Member Nydia Velázquez (D-NY) introduced a bipartisan House resolution to recognize November 25, 2017, the Saturday after Thanksgiving, as “Small Business Saturday.”

The text of H. Res. 603 highlights the important role small businesses play in our nation’s economy, stating that the over 29 million small businesses in the United States:

  • Represent 99.9 percent of all businesses with employees
  • Employ nearly 48 percent of private sector employees
  • Pay 41 percent of total private sector payroll
  • Constitute 98 percent of firms exporting goods
  • Created 1.4 million net new jobs

Our nation is built on hard work, determination, and old-fashioned American ingenuity,” said Small Business Committee Chairman Steve Chabot (R-OH). As Chairman of the House Committee on Small Business, I hear daily of the stories of America’s 29 million small businesses that stretch from West Hollywood to Westwood—my hometown. I thank Ranking Member Velázquez for her support for this bipartisan resolution, and encourage all Americans to ‘shop small’ on November 25.

Local Main Street businesses represent the heart of American entrepreneurship and promise,” said Small Business Committee Ranking Member Nydia M. Velázquez (D-NY). “I am pleased to work with Chairman Chabot in introducing a resolution to recognize Small Business Saturday. Small Business Saturday is a chance for Americans to invest in their communities, enjoy the company of neighbors and shop locally.”

The full Committee co-sponsored this resolution. 

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Operating or Rulemaking? A Review of SBA’s Opaque Standard Operating Procedures Process

House Small Business Committee News - Thu, 11/02/2017 - 10:00am


The Committee on Small Business Subcommittee on Investigations, Oversight, and Regulations will meet for a hearing titled, “Operating or Rulemaking? A Review of SBA’s Opaque Standard Operating Procedures Process.” The hearing is scheduled to begin at 10:00 A.M. on Thursday, November 2, 2017 in Room 2360 of the Rayburn House Office Building

The Subcommittee will examine the Small Business Administration’s (SBA) standard operating procedures process.


Attachments
1. Hearing Notice
2. Witness List

Witness
Mr. Joseph Loddo
Chief Operating Officer
United States Small Business Administration
Washington, DC 

Operating or Rulemaking? Reviewing SBA’s Opaque Standard Operating Procedure Process

House Small Business Committee News - Thu, 11/02/2017 - 12:00am

WASHINGTON—Today, Members of the House Committee on Small Business Subcommittee on Investigations, Oversight, and Regulations questioned Joseph Loddo, the Chief Operating Officer at the United States Small Business Administration (SBA), about SBA’s lack of transparency regarding its standard operating procedures (SOPs) process. 

SOPs instruct SBA employees how to do their job.  They help program participants understand their responsibilities. They clarify laws and regulations,” said Subcommittee Chairman Trent Kelly (R-MS). ”This Committee has been concerned for some time that the agency’s SOPs are doing more than just that.

Rep. Kelly continued, “Specifically, we are concerned that SBA is making legislative binding rules outside of the rulemaking process. They are not required to solicit public input.

Bureaucrats Writing Law

The Administrative Procedure Act (APA) establishes the requirements agencies must meet when creating rules and regulations. It ensures that agencies must provide notice to the public and allow time for comment. However, agencies including the SBA, are not required to go through these steps when creating their SOPs. 

The Small Business Committee has requested a briefing on the SOP process for several months. SBA has still not provided it.

I think that y’all can do a whole lot better job of making sure that when we send requests whether it’s from staff or the actual Member that you comply with that,” said Subcommittee Chairman Trent Kelly (R-MS). I know that from the military and certainly with soldiers, when you’re hiding something—even if it’s not bad, I’m going to think it’s bad. It’s the same way with any other organization.

The Small Business Committee works hard to ease the burden of regulations on small businesses, across industries and across our country.  The Committee wants to ensure that the SBA—and other agencies—are not rulemaking through their standard operating procedures.

Click here to watch the full video, and here to read the full testimony.

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ICYMI: Tax Reform for the Growing Gig Economy

House Small Business Committee News - Wed, 11/01/2017 - 12:00am

WASHINGTON—Today, Heidi Pickman, theCommunications and Policy Director of the California Association of Micro Enterprise Opportunity, released an op-ed in support of Chairman Steve Chabot's (R-OH) bill, H.R. 3717, the Small Business Owners' Tax Simplification Act.

"As Congress debates tax reform, we hear lots about the middle class, corporations, and the 1 percent, but we haven’t heard much about the gig economy, and we should," stated Heidi Pickman.

"What is the gig economy? Do you include independent contractors, consultants, and freelancers? Temp agency and on-call workers? Workers on a company contract?" said Pickman. "People involved in these work arrangements account for 30 million workers or about 20 percent of the labor force; a number that is growing at a rate faster than general total employment. If you include people who do some very part-time independent work, you end up with about70 million people involved in the gig economy, or 36 percent of the workforce."

Pickman continued, "The House Small Business Committee is on the right track with H.R. 3717, the Small Business Owners’ Tax Simplification Act, with a similar bill being discussed in the Senate. The bill would make several changes that would provide simplification and clarity to the tax code for entrepreneurs and startups; it would allow for voluntary withholding agreements and training services through the platforms without impacting a worker’s classification status and enable these business owners to participate in Cafeteria Plans or flexible spending accounts."

Click HERE to read full article.

H.R. 3717 Background:

The overwhelming majority of businesses in the United States are categorized as small businesses; yet, the nation’s job creators face a multitude of inequities with regard to tax policy.

Specifically, H.R. 3717 will help level the playing field for small businesses and provide clarity for entrepreneurs and startups as they face the complexity and uncertainty of the tax code. From updating signature requirements and anti-fraud measures to the treatment of cafeteria plans, the Small Business Owners’ Tax Simplification Act of 2017 will advance the United States Internal Revenue Code, just as technology is advancing how companies reach customers.


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Chairman Chabot Celebrates National Veterans Small Business Week

House Small Business Committee News - Tue, 10/31/2017 - 12:00am

WASHINGTON—Today, Chairman Chabot (R-OH) released the following statement on National Veterans Small Business Week; which is October 30-November 3,  2017:

America’s armed forces not only preserve and protect the homeland, but are also trained with the discipline and leadership necessary to own and operate successful businesses,” said Chairman Steve Chabot (R-OH). “Their dedication and strength from serving their country is evident in the nearly 2.5 million veteran-owned small businesses across the United States that create more than 5 million jobs.”

Chairman Chabot is also an original co-sponsor of Representative Brian Fitzpatrick’s (R-PA) H. Res. 588, which supports National Veterans Small Business Week.

The resolution states that:

  • Veteran-owned businesses make up nearly 10 percent of all United States businesses.
  • Veterans account for more than $1 trillion in business receipts every year.
  • Veterans are 45 percent more likely to be self-employed than non-veterans.
  • Women veteran-owned businesses have increased significantly, from 97,114 in 2007 to 383,302 in 2012.
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<p>The Committee on Small Business

House Small Business Committee News - Thu, 10/26/2017 - 10:00am

The Committee on Small Business Subcommittee on Economic Growth, Tax, and Capital Access will meet for a hearing titled, “Financing Through Fintech: Online Lending’s Role in Improving Small Business Capital Access.”  The hearing is scheduled to begin at 10:00 A.M. on Thursday, October 26, 2017 in Room 2360 of the Rayburn House Office Building.

The hearing will provide the Subcommittee with an opportunity to examine recent trends in how small businesses obtain capital, the different business models in the industry, and how online lending fits into the overall lending landscape.

Attachments
1. Hearing Notice
2. Witness List


Witnesses
Mr. William Phelan
President and Co-Founder
PayNet, Inc.
Skokie, IL
Testimony
Disclosure 

Ms. Katherine Fisher
Partner
Hudson Cook
Hanover, MD
Testimony
Disclosure 

Financing Through Fintech: Private Sector Solutions in Improving Small Business Capital Access

House Small Business Committee News - Thu, 10/26/2017 - 12:00am

WASHINGTON—Today, Members of the House Small Business Committee Subcommittee on Economic Growth, Tax, and Capital Access heard from a group of financial technology (fintech) leaders on online lending’s role in improving small business capital access.

The amount of community banks in the United States has fallen dramatically in recent years, and regulations such as Dodd-Frank have made it more difficult for small businesses to acquire loans through traditional means,” said Subcommittee Chairman Dave Brat (R-VA).  “One private sector solution that has grown considerably in recent years to address this credit gap is online lending.

Small Businesses Need Choices

While it is difficult to evaluate the size of the fintech industry, online lenders estimated that they lent between $5 and $7 billion loans to small businesses in 2015. The industry is expected to become a $50 billion dollar industry by 2020.

Fintechs have provided three critical benefits to the supply of credit to small businesses,” said William Phelan, President and Co-Founder of PayNet, Inc. in Skokie, IL. “First, they have figured out technology platforms to lower the cost of processing a credit application; second, they have changed the expectations among small businesses for access to and speed for working capital credit; third, they are filling the credit gap faced by small businesses across the credit spectrum and industry sectors.”                                                                                     

Fintech lending includes non-traditional lending that directly addresses some concerns of small businesses by providing faster access to capital than traditional lending,” said Katherine Fisher, Partner at Hudson Cook, LLP in Hanover, MD. “Technology has allowed lenders to automate the lending process, leading to a less burdensome application process. The existence of fintech lenders provides small businesses with the ability to quickly obtain capital needed for immediate operations.” 


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SBC Sends Letter To Ways & Means Requesting Consideration of H.R. 3717

House Small Business Committee News - Thu, 10/26/2017 - 12:00am

WASHINGTON – This week, House Small Business Committee Chairman Steve Chabot (R-OH) sent a letter with Ranking Member Nydia Velázquez (D-NY) to House Committee on Ways and Means Chairman Kevin Brady (R-TX) and Ranking Member Richard Neal (D-MA) requesting the Committee consider H.R. 3717, the Small Business Owners’ Tax Simplification Act. H.R. 3717 would update the tax code for small businesses, startups, and entrepreneurs.

In the letter, Chairman Chabot and Ranking Member Velázquez stated:

“The outsized role small businesses have on the economy cannot be disputed.  They are the country’s job creators, they are our nation’s innovators, and they are transforming communities from coast to coast.  However, the tax code continues to disproportionately impact the smallest firms, which often do not employ armies of experts to handle and calculate their taxes.  Moreover, the tax code has simply not kept pace with today’s technology-focused companies that are altering how businesses reach and interact with customers.”

“As the Committee on Ways and Means discusses tax reform, we request that you consider the role small businesses have on our economy, along with the provisions outlined in H.R. 3717.  In addition to the priority of cutting tax rates for small firms, this bill offers practical and common sense ideas that will truly impact every small company.  It addresses the feedback our Committee has heard again and again – to simplify and streamline the tax code. At the end of the day, when small businesses are growing and expanding, so does the American economy.”

The Committee held a hearing on October 4, 2017 to hear from private sector witnesses on H.R. 3717. They have also received numerous letters of support from groups within the sharing economy expressing how the legislation would benefit current companies and the next generation of entrepreneurs.

The full letter can be read HERE.

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