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Ms. LANDRIEU. Mr. President, I come to the floor today to introduce the Expanding Access to Capital for Entrepreneurial Leaders Act, or the EXCEL Act. This legislation will enhance the already successful Small Business Investment Company, SBIC, program at the Small Business Administration, SBA, that has helped over 100,000 small businesses. The best part of this bill is that the EXCEL Act should not cost the taxpayer anything.
The SBA runs a venture capital program by guaranteeing money borrowed by qualified investment funds who invest in small businesses. The qualified funds, or Small Business Investment Companies, SBICs, are privately owned and operated, but licensed and regulated by the SBA. Using a combination of private investments and the loans guaranteed by the SBA, typically at a ratio of $2 in guaranteed funds for every $1 of private capital, SBICs make longterm investments in American small businesses. In order to participate in the program, funds pay licensing fees which serve to cover all SBIC program costs. As a result, the core SBIC program, Debenture SBICs, not only boasts a strong success rate, but also incurs no cost to the U.S. government. Since the program's inception, over $50 billion has been invested in over 100,000 small businesses.
In the last Congress, the former Ranking Member of the Small Business Committee, Senator Olympia Snowe, and I conducted a roundtable with 14 participants from the SBA, SBICs, SBIC investors, and small businesses to elicit suggestions on enhancing the program. Out of that was born the EXCEL Act.
The EXCEL Act is a bipartisan effort encompassing much-needed changes that will allow the SBIC program to meet growing demand and will make improvements so that more small businesses can access capital.
First, the EXCEL Act raises the SBIC program authorization level from $3 billion to $4 billion and pegs it to inflation. This change is long overdue--the ceiling has been at $3 billion for some time, despite inflation and the impressive growth in the SBIC program. To illustrate: the program grew 50 percent in fiscal year 2011 alone. In order to meet demand, we need to give the program room to grow.
Secondly, the EXCEL Act will encourage successful investors by raising the limit on ``families of funds.'' Family of funds refers to a team of SBIC fund managers who operate several funds. These are currently limited to $225 million of SBA-guaranteed debt. However, SBIC fund managers who manage more than one fund generally see better investment results. The EXCEL Act will encourage that kind of success by giving families of funds a higher limit of $350 million, which will be indexed to inflation.
Next, the EXCEL Act improves transparency and accountability in the program. The legislation requires that the SBA make public how effective individual SBICs are in their small business investments, guaranteeing that SBA-backed money is being used responsibly.
Finally, the EXCEL Act promotes outreach, thereby ensuring that the maximum possible number of small businesses can benefit from the SBIC program. The legislation encourages outreach to community banks and other lenders, states and municipalities, and asks the SBA to make their SBIC website more user-friendly.
The EXCEL Act contains a number of commonsense provisions that have had support across the aisle. It enhances a program with proven success in providing capital to small businesses, and does so with the expectation that it will not add a dime to the deficit. Let us get this bill passed. Let us help small businesses excel.
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