Senator Mary L. Landrieu, D-La., Chair of the Senate Committee on Small Business and Entrepreneurship, plans to introduce the Success Ultimately Comes from Capital, Contracting, Education, Strategic Partnerships and Smart Regulation (SUCCESS) Act of 2012 as a stand-alone bill after the same language received strong bipartisan support in the Senate today as an amendment.
Sen. Landrieu offered the SUCCESS Act, which would spur small businesses job growth and boost entrepreneurship, as an amendment to S. 2237, the Small Business Jobs and Tax Relief Act. The SUCCESS Act, which received 57 votes, including support from five Republicans, is the result of multiple committee hearings, including three roundtables hosted by Chair Landrieu earlier this year to explore strategies, tools and methods to strengthen the ecosystem of entrepreneurship.
"It is a monumental feat in today's political climate for legislation to receive 57 bipartisan votes before the United States Senate. As such, I am proud that the great work of the Small Business Committee received such overwhelming and bipartisan support today," Sen. Landrieu said. "The SUCCESS Act is the product of three outstanding and informative roundtables our committee hosted since February and is made up of numerous bipartisan provisions offered by members of the committee.
"I'd like to thank each and every one of my colleagues from both sides of the aisle who helped craft this amendment and all those who voted for it. I intend to build off today's success and offer the language of the amendment as a stand-alone bill. Our goal will be not just to pick up the 57 Senators who voted for the SUCCESS Act today but to win over the other senators necessary to pass this bill. It is my hope that we will revisit this bill again this year and get our small businesses the assistance they need to grow our economy."
Included in the SUCCESS Act are a number of extensions of expiring or expired tax cuts for small businesses for 2012 and 2013 that were first introduced by Sens. Landrieu and Olympia Snowe, Ranking Member of the Senate Committee on Small Business and Entrepreneurship, in the Small Business Tax Extenders Act (S. 2050). According to a report from the Congressional Joint Committee on Taxation, the SUCCESS Act's tax relief provisions would deliver $12 billion dollars of tax cuts for small businesses in 2012 and 2013. Specifically, the SUCCESS Act's tax relief for small businesses would:
Extend 100 percent capital gains tax relief on qualifying investments in small business stock purchased through December 31, 2013 and held for five years.
Double the existing deduction for start-up costs for new small businesses.
Temporarily reduce the period an S-Corporation is required to hold onto its assets after converting from a C corporation.
Allow small businesses to carry back general business credits from 2012 and 2013 to offset five years of taxes to increase cash-flow for businesses that are currently not realizing profits.
Extend the availability of enhanced Section 179 expensing to give businesses the option of writing off the cost of qualifying capital expenses in the year of acquisition in lieu of recovering these costs over time through depreciation. This provision would also allow small businesses to write-off up to $250,000 of improvements to restaurant and retail property.
Another aspect of the SUCCESS Act is the Expanding Access to Capital for Entrepreneurial Leaders (EXCEL) Act that was introduced earlier this year by Sens. Landrieu and Snowe. The Excel Act would modify the Small Business Investment Company (SBIC) program to raise the amount of SBIC debt the Small Business Administration (SBA) can guarantee from $3 billion to $4 billion. It would also increase from $225 million to $350 million the amount of SBA guaranteed debt a team of SBIC fund managers who operate several funds can borrow.
On March 22, Chair Landrieu led the committee in a roundtable with federal officials, SBIC fund managers, and companies to discuss modifications to the SBIC program.
These two SBIC provisions, along with the 100 percent capital gains tax relief and increased deduction for start-up expenses proposals, are part of the Startup America Legislative Agenda that President Barack Obama sent to Congress on January 31, 2012.
Another key part of the amendment would extend for one year a provision allowing small business owners to use SBA 504 loans to refinance existing commercial mortgages. The measure, originally enacted as part of the Small Business Jobs Act of 2010, did not become operational until February 2012, significantly shortening the period of time that business could use 504 loans to refinance qualifying existing debt. It is set to expire on September 27, 2012.
The 504 loan program is a long-term financing tool for economic development that provides small businesses with long-term, fixed-rate loans to help them acquire major fixed assets for expansion or modernization. Certified Development Companies (CDC) work with the SBA and private sector lenders to provide financing to small businesses under the 504 loan program. A CDC is typically a private, nonprofit corporation set up to contribute to the economic development of its community.
Other provisions in the SUCCESS Act include:
The Small Business Lending Activity Index Act;
The Small Business Export Growth Act;
The Measuring the Effectiveness of Resource Partners Act;
The Women's Small Business Ownership Act;
The Strengthening America's Small Business Development Centers Act;
Oversight of Ineffective SBA Programs;
SBA Surety Bond Increase;
The Small Business Contracting Fraud Prevention Act;
The Fairness in Women-Owned Small Business Contracting Act;
The Small Business Champion Act; and
The Small Business Common Application Act.
Additionally, the bill authorizes GAO to review the status of programs authorized in the SUCCESS Act after 2 years, including the extent they have been funded, implemented and are promoting job creation among small businesses.