A Message from David

Statement

Dear Friend,

This week saw a big victory for our community as a jobs bill we have been working on for some time was passed through committee.

On Wednesday, the Financial Services Committee approved my Small Company Capital Formation Act, another milestone closer to enacting this common-sense proposal.

This bill, H.R. 1070, is first and foremost a jobs bill. The main objective for this legislation is to make it easier for small businesses to be traded on public exchanges like the NYSE or NASDAQ and to access capital to permit greater investment so these companies can grow and create new jobs. This bill specifically achieves this objective by increasing the Regulation A exemption from $5 million to $50 million.

Regulation A, which has been on the books since 1933, exempts small businesses from the SEC's filing requirements for less than $5 million. Though Regulation A has periodically increased from its initial ceiling of $100,000 in 1933 to the current $5 million ceiling in 1992, it has not been increased to reflect the rising costs associated with bringing a small company public over the last two decades.

The Small Company Capital Formation Act will ensure that this ceiling is raised when necessary and as economic conditions warrant by requiring that the SEC revisit this ceiling every two years. Should the SEC find that the ceiling needs to be higher, this bill will provide them with the authority to increase the limit.

In layman's terms, my legislation is intended to relieve small businesses from the excessive costs and paperwork of "going public." Since taking a small business public is an important but expensive process that requires millions in underwriting costs, reducing these burdensome regulations will create more jobs.

Small businesses are the engine of job growth in our country. We are especially blessed to have so many of these small businesses in Arizona's 5th district. Through this bill, I hope to help them more efficiently raise funds that can be used to hire new employees and make our capital markets more vibrant and competitive.

I head home tonight on a flight back to Phoenix for a week in Arizona - - finally! Looking forward to seeing many of you at community events to come. Please look for a schedule of upcoming traveling office hours that my staff will host this summer. I will announce them later this month.

David Schweikert
Member of Congress

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