A bill to extend the availability of low-interest refinancing under the local development business loan program of the Small Business Administration.

Mr. President, I come to the floor today to discuss the importance of small businesses in the United States. It cannot be stated enough that small businesses are the economic engines of our country. Small businesses also represent the essence of the American Dream. They are creators of new jobs and innovative technologies. In fact, over the last 15 years, businesses employing less than 500 people have created 93 percent of all new jobs and employed 58.6 million workers. Businesses employing less than 20 people alone employed 21.3 million workers. In my home state of Louisiana, small businesses make up about 98 percent of businesses. As Chair of the Senate Committee on Small Business and Entrepreneurship, I remain focused on the needs of these small businesses. That is why I am here today to introduce a bill that I believe will help spur job creation among small businesses.

As you know, right now our country is still mired in an historic economic downturn. This economic downturn is disproportionately affecting small businesses and, in turn, stifling opportunities for them to generate economic growth for the country. Sadly, since November 2008 80 percent of the job losses have come from small businesses. 2.16 million jobs were lost in the private sector from July to February 2008--nearly half from businesses with less than 50 employees. While corporate layoffs get the headlines, small business layoffs increase the breadlines. Ten jobs lost here and five jobs there add up. These are the job losses that hurt our economy, our communities and our families.

With this in mind, I was proud to lead Congressional efforts to enact the Small Business Jobs Act of 2010, Public Law 111-240. President Obama signed this legislation into law on September 27, 2010. This legislation focused on the three ``C's'' important to small businesses: Capital, Contracting, and Counseling. 332 community banks in 47 states have received $4.01 billion in funding from the Small Business Lending Fund in the bill, which is $9.3 billion in leverage potential for small businesses. Furthermore, a total of 54 states/territories applied for funding through the Small Business State Credit Initiative Program to support State-run small business lending programs. Approximately, $1.3 billion for 47 states and territories has been approved. Lastly, $30 million of Round 1 of State Trade and Export, STEP, export grant funding was awarded in the Fall 2011 to 52 states and territories to promote small business exports. To date, the Small Business Jobs Act has provided an important boost to small businesses looking to get credit or open new markets overseas.

Given the importance of small businesses to our economy, I believe that there is no better time than now for Congress to build off the success of the Small Business Jobs Act. But the key question is how to best assist our country's 28 million small businesses? This is complicated because Federal law defines a small business as ``those having 500 employees or less.'' They may all fit under the same broad category of small business, but they are not all the same. So it makes no sense for the Federal government or Congress to have a ``one size fits all'' policy for helping them grow. We must put a special focus on maximizing strategies to help those small firms that have the capacity to grow in the near term.

The approach I have taken is to focus on the entrepreneurial ecosystems in our communities. This is because an ecosystem is defined as ``a system formed by the interaction of a community of organisms with their environment.'' I am particularly interested in the relationship between entrepreneurs, the current environment for entrepreneurship, and how we can make them more robust. In my view strengthening these ecosystems is an avenue to spur small business growth, create jobs, and grow our economy.

Babson College, one of the country's top colleges for undergraduate/ graduate entrepreneurship programs, has looked into what makes up an entrepreneurial ecosystem. Babson has identified the ``six domains'' of any entrepreneurial ecosystem: a conducive culture that rewards innovation, creativity and experimentation; enabling policies and leadership that provide regulatory and capital support; availability of appropriate finance, including micro-loans, private equity and public capital; quality human capital that include both skilled and unskilled workers from at home and abroad; venture-friendly markets for products by creating distribution channels and entrepreneurship networks; and a range of institutional and infrastructural supports, including incubation centers and legal and accounting advisers.

Building off this research and with feedback from other stakeholders, late last year my committee began preparations to conduct a series of roundtables on strengthening the entrepreneurial ecosystem for small businesses. The goal of these roundtables, which were conducted between February and April 2012, was to take the ideas that come out of these discussions and use them as the foundation for a major piece of legislation to support the entrepreneurial ecosystem. The first roundtable on February 1, 2012, was entitled ``Developing and Strengthening High-Growth Entrepreneurship.'' This roundtable set the stage for our discussions by exploring the recent success of high- growth firms in job creation and why it is so important that we replicate that success. The second roundtable was on March 22, 2012, and was entitled ``A Spotlight on Small Business Investment Companies and Their Role in the Entrepreneurship Ecosystem.'' That roundtable looked at how we could enhance an already successful program that gets capital into the hands of America's job creators. The last roundtable was on April 18, 2012, and was entitled ``Perspectives from the Entrepreneurial Ecosystem: Creating Jobs and Growing Businesses through Entrepreneurship.'' That roundtable discussed how different stakeholders in the entrepreneurial ecosystem are creating new entrepreneurs and growing businesses. It brought together key stakeholders from different levels of an entrepreneurial ecosystem: universities and entrepreneurship programs, Federal and local officials, investors, private sector accelerators, mentors, and successful entrepreneurs.

As a result of these three roundtables, my committee received almost 60 specific policy recommendations from the 41 participants. Some of these recommendations fell under the

jurisdictions of other Senate committees, while other proposals had a significant cost associated with them or lacked the strong bipartisan support necessary to move them forward in the Senate. After further consulting with my colleagues on the committee, I was able to identify our own six ``domains'' of proposals to focus our efforts on: Tax and Finance; Access to Capital; Access to Global Markets; Access to Mentoring, Education and Strategic Partnerships; Access to Government Contracting; and Transparency, Accountability, and Effectiveness. These domains form the six titles of the Success Ultimately Comes from Capital, Contracting, Education, Strategic Partnerships, and Smart Regulations, SUCCESS, Act of 2012.

First, Title I of the SUCCESS Act provides almost $12 billion in tax incentives to assist small businesses. All five tax provisions within the SUCCESS Act were based on parts of legislation, S. 2050, that was introduced in January by Senator Snowe and myself. S. 2050, the Small Business Tax Extenders Act, reflects the work of many of my Senate colleagues, including Senators Snowe, Kerry, Merkley, Cardin, Isakson, and Shaheen.

Section 102 of the SUCCESS Act extends the 100 percent exclusion from tax the gain on the sale of qualified small businesses, QSB, stock that non-corporate taxpayers purchase in 2012 and 2013 and hold for 5 years. Qualifying small business stock is stock of C-corporation whose gross assets do not exceed $50 million, including the proceeds received from the issuance of the stock, and who meets a specific active business requirement. The amount of gain eligible for the exclusion is limited to the greater of ten times the taxpayer's basis in the stock or $10 million of gain from stock in that corporation. Until 2009, non- corporate taxpayers were allowed to exclude 50 percent of the gain from the sale of stock of QSB if the taxpayers held the stock for 5 years. The Recovery Act of 2009 increased the 50 percent exclusion to 75 percent and the Small Business Jobs Act and subsequent legislation increased and extended the exclusion to 100 percent through 2011. However, as of January 1, 2012, the 100 percent exclusion has reverted to 50 percent and startup investments are no longer entitled to preferential capital gains treatment.

Senator Kerry, a senior member of my committee as well as the Finance Committee, has been a leader in the Senate in getting this provision extended in previous Congresses. I also note that this proposal has bipartisan and White House support. President Obama has repeatedly called on Congress to make permanent the 100 percent capital gains exclusion and included this proposal in his Startup America Legislative Agenda. Senators Moran, Warner, Coons and Rubio have all called for making this provision permanent and included a version of this provision in S. 3217, the Startup Act 2.0 that was introduced in May. According to a Kauffman Foundation paper published earlier this year, the 100 percent exclusion ``boosts the after-tax returns on such investments in startups and should induce substantial levels of new investments in startup firms.'' They further estimate that making this provision permanent would increase risky investments by conservatively 50 percent more than overall cost of the provision.

Section 103 of the bill extends the increased deduction for business start-up expenditures in 2012 and 2013 from $5,000 to $10,000, subject to a $60,000 threshold. Under current law, taxpayers can elect to deduct up to $5,000 of ``start-up expenditures'' in the taxable year in which they start a trade or business. The $5,000 is reduced--but not below zero--by the amount by which start-up costs exceed $50,000. Examples of startup costs include studies of potential markets, products, labor markets, or transportation systems; advertisements for the opening of a new business; compensation for consultants and employees undergoing training and their instructors; and travel for the purpose of securing suppliers, distributors, and customers.

The Small Business Jobs Act temporarily increased the amount of start-up expenditures entrepreneurs could deduct from their taxes in 2010 from $5,000 to $10,000, with a phase-out threshold of $60,000. We need to bring this provision back to aid our small businesses.

I note that there is also support within this chamber and from the White House for this proposal. As part of his Startup America Legislative Agenda, President Obama has called for making permanent the increased deduction for start-up expenditures. Senator Merkley successfully fought for the initial increase in deduction to be included in the Small Business Jobs Act. Over the past several years, this proposal has been repeatedly endorsed by the National Association for the Self-Employed and the National Federation of Independent Businesses, NFIB. Furthermore, according to a Kauffman Foundation survey, on average, new firms inject about $80,000 into their business during the first year of operation. The vast majority of small business owners--between 80 percent and 90 percent--also invest significant amounts of their own money into their businesses. These budding enterprises are also more dependent on personal capital at startup than after they become established businesses. Doubling the deduction for start-up costs puts cash in the hands of small businesses owners who need it most--those who are just getting started. According to estimates from Third Way, a non-partisan group, this proposal would help the more than 600,000 Americans who start their own business every year.

Under current law, when a corporation becomes an S-Corporation, it is required to hold its business assets for 10 years or pay punitive taxes. This 10- year holding period is too long and ties up assets that could be sold to raise capital. In 2010, Congress reduced this holding period to 5 years to better match business planning cycles. Section 104 of my bill will extend the 5-year holding period for 2012 and 2013, costing $251 million over 10 years. As with other provisions in the SUCCESS Act, this provision has bipartisan support. Senator Cardin has fought to make this proposal permanent. Senators Snowe, Vitter, and Roberts have also been long-time supporters and are co-sponsors of legislation introduced by Senator Cardin to make this provision permanent. By granting this extension, we will give the more than 4 million S-Corporations in the U.S. the flexibility they need to raise capital.

Section 105 would allow sole proprietorships, partnerships and non- publicly traded corporations with less than $50M in average gross annual receipts for the prior 3 years, to carryback unused general business credits earned in 2012 and 2013 for 5 previous years. Under current law, if a business has no tax liability in its current tax year, it may carry the general business tax credit back to the previous tax year to offset taxes paid in the previous year and obtain a refund. If the current credit exceeds taxes paid in the previous year, the remaining credit may be carried forward for 20 years, without interest, and used to offset tax liability in future years. The general business credit is limited to the difference between the regular tax liability of a business and the greater of its tentative minimum tax or 25 percent of regular tax liability in excess of $25,000. The general business tax credit is comprised of several different tax credits including the R&D tax credit, energy credits, the Low-Income Housing Tax Credit and the Work Opportunity Tax Credit.

This extension would provide tax refunds to businesses that were previously healthy but are currently running losses. It would improve the effectiveness of business credits that are intended to expand investment and employment, in the case of the Work Opportunity Tax Credit. It would also allow businesses greater immediate benefit from credits designed to encourage specific types of economic activity, such as hiring disadvantaged workers or investments in renewable energy. By providing businesses with greater opportunity to claim business credits, the provisions would also give an infusion of cash to businesses, which might promote investment. This could be particularly important if businesses have trouble borrowing because of financial market problems.

Section 106 of the SUCCESS Act extends a generous Section 179 provision that allows small businesses to immediately write-off up to $500,000, up from $250,000, for tangible personal property

and up to $250,000 for improvements to leasehold property and retail property.

Under the Small Business Jobs Act and other subsequent legislation, for taxable years beginning in 2010 and 2011, small businesses could write-off for capital expenditures for ``qualifying Sec. 179 property'' up to $500,000 and the phase-out threshold has been increased to $2,000,000. These thresholds were up from prior law thresholds of $25,000/$200,000. In addition, for the first time, the Small Business Jobs Act allowed taxpayers to expense $250,000 of the cost of improvements to real property including qualified restaurant property and qualified retail property. To qualify for the section 179 deduction, property must have been acquired for use in the trade or business. Examples of qualifying property include machinery and equipment; property contained in or attached to a building, other than structural components, such as refrigerators, grocery store counters, office equipment, printing presses, testing equipment, and signs.; gasoline storage tanks and pumps at retail service stations.; livestock, including horses, cattle, hogs, sheep, goats, and mink and other furbearing animals.

Extending the enhanced Section 179 deduction has bipartisan Senate support, White House support, and industry support. The President supports extending Section 179. My colleague Senator Snowe is a strong supporter of the enhanced Section 179 provision that allows businesses to expense improvements to restaurant and retail property. She developed this particular proposal in connection with her work on the Small Business Jobs Act. Finally, 26 National business groups such as the NFIB, the U.S. Chamber of Commerce, the National Association of Homebuilders, and the National Association of the Self-Employed endorsed extending Section 179 and including expensing for real property improvements in a May 21, 2012 letter to Congress.

The next title of the SUCCESS Act focuses on improving access to capital for small businesses. In particular, Subtitle A under Title II was previously introduced as S. 3253, the Expanding Access to Capital for Entrepreneurial Leaders, EXCEL, Act. It provides necessary and timely enhancements to the Small Business Investment Company, SBIC, program. SBICs are government backed and regulated private equity funds which invest in U.S. small businesses. The SBIC program was created in 1958 by then Senator Lyndon Johnson and Senator William Fulbright, and signed into law by President Eisenhower. During a Senate hearing on the creation of the program, Senator Joseph Clark said the legislation is ``necessary to increase the availability of long-term credit and equity capital for small businesses.''

Since 1958, SBICs have invested $56 billion in over 100,000 small businesses. The core debenture program operates at no cost to taxpayers. SBIC success stories include: Apple Computer, Callaway Golf, Costco, Outback Steakhouse, Jenny Craig, Annie's food company, and Center Rock of Berlin, PA, the manufacturers of the drill bit that saved the Chilean miners in October 2010.

The SBIC program has seen strong growth in the past few years. For example, the program grew 50 percent in fiscal year 2011 alone. However, the authorization level has not been permanently raised since 2003. To continue fulfilling the intent of the original legislation, it is time to make some improvements. The Landrieu-Snowe EXCEL Act has two main components. First, it raises the statutory cap for the SBIC Program from $3 billion to $4 billion. Second, it increases the amount of leverage by SBIC licensees under common control from $225 million to $350 million ``Family of Funds''. The components of this provision were also included in the President's Startup America legislative package.

Subtitle B of Title II was originally introduced as S. 2364 by Senators Snowe, Landrieu, Isakson and Shaheen. 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 and real estate for expansion or modernization. The Small Business Jobs Act allowed small businesses to use the 504 loan program to refinance certain qualifying existing debt for two years, but the SBA did not promulgate regulations to implement the refinancing provision until February 17, 2012.

This subtitle would extend for a year and a half a provision allowing small business owners to use Small Business Administration, SBA, 504 loans to refinance existing commercial mortgages. Extending the 504 refinancing program is a common-sense way to help small businesses and create jobs. By allowing small businesses to refinance qualified commercial real estate debt, this program lowers their monthly mortgage payments at no cost to taxpayers. That's right, this provision has zero subsidy cost. At a time when we are still facing high unemployment, this extension is one of many things that we should be doing to put more capital in the hands of America's job creators.

Subtitle C of Title II is a new proposal introduced for the first time as part of the SUCCESS Act. SBA currently releases some information publicly about SBA lending activity, but it is almost impossible to find and comprehend if you are not an SBA lending professional. If a small business, mayor, or governor wants to determine SBA lending activity in their area, they lack the ability to do so easily.

This subtitle would require the SBA to post a user friendly Lender Activity Index on the SBA website. Users will immediately be able to access the following data for any given bank: name of bank, number of SBA loans each bank made, total dollar amount of SBA loans of each bank, zip code of bank activity, not where every single loan was made, but a list of every zip code where the bank has made an SBA loan, industries lent to, hospitality, manufacturing, service, software, etc., stage of business cycle, new, or existing business, and business specific information, i.e. Women Owned Businesses, Minority Owned Businesses, or Veteran Owned Businesses. Data will be available for the year to date and users will be able to compare to 3 previous fiscal years. Both quarterly and annual data will be included.

Title III of the SUCCESS Act focuses on promoting exports from small businesses. The Small Business Jobs Act made major changes to the international trade work done by the SBA. Now that those provisions have been in place for several years, there are additional refinements and direction needed. I would like to specifically thank Senators Shaheen and Ayotte for their bipartisan export contributions to this effort. The export provisions of Tile III are taken from S. 3218, their Small Business Growth Act of 2012, as well as S. 3277, the Go Global Act of 2012 that Senator Shaheen and I authored this year.

95 percent of the world's customers are located outside of the borders of the United States, and in the last twelve months we have exported more than $2 trillion of goods and services to these consumers. Yet only 1 percent of our approximately 28 million small businesses export. Our agencies need to be working together to ensure our small businesses have the resources they need to expand their customer base and be part of the more than $180 billion in exports that the United States sends around the world each month.

This title aids our small business exporters by addressing federal government coordination, resources for rural businesses, and export control education. It establishes, in Section 306, an interagency task force of SBA, the Department of Agriculture (USDA), the Export-Import Bank, and the Overseas Private Investment Corporation on export financing to review, improve, and increase collaboration on current finance programs. Then, to further coordination, Section 307(a) begins a cross training program with SBA and USDA to inform their respective export finance specialists more about each other's programs. Our small businesses face enough challenges--we should be bringing our resources to them. In Section 304, this bill requires SBA, in coordination with other agencies, to do at least one export outreach event per year in each state. Section 307(b) also aids our rural small businesses by posting a list of rural lenders who participate in SBA and USDA loan programs and a list of rural small businesses counseling and technical assistance resources. Jobs created by exports pay, on average, 15 to 20 percent more than jobs created by goods and services sold

in the United States. This bill will continue to support entrepreneurs who want to create and grow these employment opportunities for all Americans.

Title IV of the bill focuses on promoting small business access to mentoring, education and strategic partnerships. Subtitle A of this title was originally introduced by Senator Snowe and I as S. 3198, the Strengthening Resources for America's Entrepreneurs Act of 2012. The SBA Office of Entrepreneurial Development, OED, oversees a network of programs and services that support the training and counseling needs of small business. According to the SBA, OED helps hundreds of thousands of small business clients start, grow and compete in global markets by providing quality training, counseling and access to resources. SBA delivers these services through non-profit, college and university, and community-based organization resource partners. Through its network of over 1,000 resource partners across the country, OED programs include Small Business Development Centers, SBDCs, Women's Business Centers, SCORE, and Entrepreneurship Education. However, it is currently difficult to track effectiveness and ensure our resources are being used in the best ways possible. To solve this challenge, this subtitle has four primary components. First, it requires the SBA to coordinate and make consistent data collection and outcome metrics for Entrepreneurial Development programs. Second, it increases planning for utilizing Entrepreneurial Development programs to create jobs. Third, it increases coordination between Entrepreneurial Development programs and Resource Partners at the national level. Finally, it increases accountability measures and reports to Congress regarding the effectiveness of Entrepreneurial Development programs.

Subtitle B of the bill comes from S. 3197, the Women's Small Business Ownership Act which was sponsored by Senator Snowe and myself. This subtitle is focused on the SBA Women's Business Center (WBC) program. The WBC program was established in 1988 and implemented through the SBA's Office of Women's Business Ownership. It provides quality counseling and training services to all entrepreneurs, primarily women, especially those who are socially and economically disadvantaged. Through a network of over 100 non-profit organizations, WBCs help more than 150,000 clients annually to start and grow small firms in the local area in which they serve and to stimulate economic growth. Subtitle B reauthorizes the WBC program through Fiscal Year 2015 and makes improvements to the program, including a Government Accountability Office review of Women's Business Center program performance as compared with other SBA Entrepreneurial Development programs.

Subtitle C of the SUCCESS Act is Senator Snowe's Strengthening America's Small Business Development Centers Act. Small Business Development Centers (SBDCs) are considered to be the backbone of the SBA's Office of Entrepreneurial Development efforts, and are the largest of the agency's OED programs. SBDCs are the university based resource partners that provide counseling and training needs for more than 600,000 business clients annually. From 2007 to 2008, the counseling and technical assistance services they offered lead to the creation of 58,501 new jobs, at a cost of $3,462 per job. Additionally, they estimate that their counseling services helped to save 88,889 jobs. This subtitle would reauthorize SBDC program at the current $135 million authorization level through fiscal year 15. Beyond reauthorizing the SBDC program, this provision also encourages SBDCs to improve outreach and communications to universities, community colleges, and junior colleges and allows the SBA Administrator to authorize out-of-state SBDCs to provide assistance in declared disaster areas.

Subtitle D of Title IV was originally introduced as S. 3281 by Senators Snowe, Kerry, and Coburn. This subtitle repeals Federal authorization of the National Veterans Business Development Corporation, TVC, eliminating an ineffective government program. The National Veterans Business Development Corporation, also known as The Veterans Corporation or simply TVC, has been ineffective and controversial since its inception as part of the Veterans Entrepreneurship and Small Business Development Act, P.L. 106-50, in 1999. In December of 2008, former Small Business Committee Chairman Kerry and Ranking Member Snowe investigated TVC, and issued a report detailing the organization's blatant mismanagement and wasting of taxpayers' dollars. Since the issuing of the Small Business Committee's report, Congress has appropriated no further funding for TVC, and the Small Business Administration has incorporated the Veteran Business Resource Centers, VBRCs, that TVC previously funded into its existing network of Veteran Business Outreach Centers, VBOCs. At present, TVC still exists as an organization, and it is still technically federally chartered. At the same time, it receives no Federal funds, has no Department or Agency oversight. It is time for it to be eliminated.

Title V of the SUCCESS Act focuses on promoting Federal government contracting opportunities for small businesses. Section 511 under Subtitle A of Title V was originally introduced by Senators Cardin, Landrieu and Snowe as S. 2187, the Small Business Administration Surety Bond Increase Act. The SBA administers a surety bond guarantee program, designed to encourage sureties to issue bonds when they would otherwise determine that a small business presents an unacceptable degree of risk. Under the program, SBA may guarantee bid, performance, and payment bonds for individual contracts of $2 million or less for small businesses that cannot obtain surety bonds through regular commercial channels. In the American Recovery & Reinvestment Act of 2009, Senator Cardin was able to temporarily increase the size of SBA surety bond guarantee from $2 million to $5 million. Section 511 would make that permanent. It would ensure that small businesses have the means to the secure the necessary surety bonding to compete for contracts during the economic downturn.

Subtitle B of Title V was originally introduced by Senators Snowe, Landrieu, Enzi, Brown, Merkley, Cantwell and eight other senators as S. 633, the Small Business Contracting Fraud Prevention Act. Fraud in small business contracting programs has starkly increased over the years. Recently we have all read about instances where large businesses misrepresent their size and status to receive the benefits of SBA programs designed for small businesses. Firms that engage in this activity have long been subject to civil and/or criminal penalties under various laws and government-wide policies.

The provisions in Subtitle B provide the SBA Inspector General with enhanced tools to eliminate fraud in small business contracting programs by: imposing greater penalties for fraud; requiring that firms be debarred for five years if they misrepresent their status as veteran-owned for purposes of programs under the act; and requiring the SBA to submit annual reports to Congress on the number of persons debarred or suspended from government contracting, or considered for debarment or suspension from government contracting, for violations of the bill. This will deter fraud in government small business contracting and will keep Congress in the loop on small business fraud issues.

Subtitle C under Title V was originally introduced by Senators Snowe, Landrieu, Gillibrand and seven other senators as S. 2172, the Fairness in Women-Owned Small Business Contracting Act. Currently, the Women- Owned Small Business, WOSB, contracting program caps contract awards to woman-owned businesses at $4 million for goods/services and $6.5 million for manufacturing. In addition, sole-source contract awards under the program are prohibited. In other words, this program has limits that no other contracting program has.

The provisions in Subtitle C would remove the contract award price limits for women-owned small businesses, create a provision allowing sole-source contract awards to WOSBs, direct the SBA to periodically conduct a study to identify any U.S. industry in which women are underrepresented, and every five years report the study results to Congress. From these improvements, more contracting opportunities will emerge for women-owned businesses in the Federal marketplace.

Subtitle D of the Title V of the SUCCESS originated with our colleagues in the House of Representatives as H.R. 3851, the Small Business Champion Act. The Small Business Act established an Office of Small and Disadvantaged Business, OSDBU, within all major Federal Executive Agencies. The OSDBU is the primary advocate within each Agency responsible for promoting the maximum use of all small business programs within the Federal contracting process. The OSDBU is tasked with ensuring that each Federal agency and their large prime vendors comply with federal laws, regulations, and policies to include small businesses as sources for goods and services, both as prime contractors and subcontractors. Approximately 35 Federal Agencies have fully functioning OSDBU offices.

In an effort to assist agencies with meeting contracting goals, Subtitle D makes three major modifications to OSDBU offices. First, it elevates the OSDBU Director at each agency to the Senior Executive Service, SES, rank. Second, it prohibits combining the duties of the OSDBU Director with unrelated duties. Finally, it requires that agencies consult with the OSDBU office on decisions to insource work performed by small businesses. I would note that the House of Representatives Committee on Small Business approved H.R. 3851 by voice vote on March 7, 2012.

The final title of the SUCCESS Act is focused on improving Federal Government transparency, accountability, and effectiveness. A key component of this title is a result of the work of my colleague Senator Hagan from North Carolina. In particular, Subtitle A of Title VI is based upon Senator Hagan's legislation, S. 3194, the Small Business Common Application Act of 2012.

Whether it is applying for a grant, seeking technical assistance, or bidding on a contract, small businesses face a dizzying array of paperwork when interacting with the Federal government. As a result, many small businesses avoid Federal programs altogether, missing out on potentially lucrative business opportunities. Senator Hagan's bill aims to streamline assistance for small businesses facing layers of paperwork when they apply for a grant, seek technical assistance or bid on a contract from the Federal government.

Furthermore, according to a 2010 study from the SBA Office of Advocacy, it costs small businesses with 20 employees or less more than $10,500 per employee to comply with Federal regulations. When compared to their larger counterparts, it costs small firms over $2,800--or approximately 36 percent more--for each employee.

Subtitle A builds off provisions in S. 3194 by establishing an Executive Committee of 12 Federal agency representatives, headed by the SBA Administrator, to review the feasibility of establishing a Small Business Common Application. This Executive Committee would then provide recommendations to the Executive Branch and Congress within 270 days on establishing a common application and web portal for small businesses.

The small business ``common app'' would function much like the one that students complete to apply to multiple colleges and universities simultaneously. It would ensure that small businesses across the country can concentrate on growing and creating jobs--not wasting time, filling out mountains of repetitive paperwork.

Lastly, I recognize that it is important to provide sufficient oversight of the programs and assistance authorized in this bill. Subtitle B of Title VI would authorize a GAO review of the bill-- including whether programs receive necessary funding, have been successfully implemented, and are promoting job creation among small businesses. This report would go to the House and Senate Small Business Committees not later than 2 years after the date of enactment.

In closing, I would like to reiterate that the SUCCESS Act is a combination of numerous bipartisan bills that have been introduced this Congress. So these proposals are neither new nor untested--they are ready for prime time. On July 12, 2012 the Senate voted on the SUCCESS Act as part of Senate Amendment 2521 to S. 2237, the Small Business Jobs and Tax Relief Act of 2012. Although the amendment came up short of the 60 votes needed to end debate, Senate Amendment 2521 did receive a strong 57 bipartisan votes. My Republican colleagues Senators Snowe, Collins, Vitter, Scott Brown, and Heller all voted in support of the amendment. I thank them for joining with us to try to move this legislation forward in the Senate. It is my understanding that some of my Republican colleagues may have voted for the amendment if it did not contain the underlying provisions from S. 2237. Procedurally, it was necessary to include these provisions to ensure a vote on the SUCCESS Act. However, recognizing these concerns, our bill that is being introduced today only includes Subtitle B of Senate Amendment 2521--the bipartisan SUCCESS Act provisions. I hope that additional colleagues from both sides of the aisle will now support the SUCCESS Act, especially as we are only a few votes short of being able to move it forward here in the Senate.

Mr. President, I ask unanimous consent that the text of the bill be printed in the Record.

Mr. President, I would like to talk a little bit more specifically this morning about the issue of interest rates on student loans. President Obama is busy this week traveling to campuses across America to talk about student loans. It is a noble goal to talk about making it easier for students to afford college. It is a goal we all share.

But I am afraid the President is not telling the whole story. Because if he were to tell the whole story, what he would have to tell the students is that the principal reason for the rise in tuition at public colleges and universities and community colleges across America and the principal reason for the increase in student loans is President Obama himself and his own health care policies.

To be fair, he did not start many of these policies. They have been going on for a good while. But he has made them worse over the last several years. When the new health care law goes into effect in 2014, with its new mandates on States, we will find an exaggeration of what has already been happening, which is that Federal health care mandates on States are soaking up the money States otherwise would spend on the University of Oklahoma, and Tennessee, and the State University of New York.

When States do not support their public colleges and universities, which is where approximately three-quarters of our college students attend, then their only choice is either to become more efficient, to decrease their quality or to raise tuition. Most of them are trying to do all three.

So Federal health care policies are the main reason tuition is up, and the reason tuition is up is the main reason debt is up. Specifically, what we are talking about, and what the President has been talking about, is a 3.4-percent interest rate for some student loans.

Here are some facts about that. The President has proposed that for 1 year, for new Stafford subsidized loans, rates would remain at 3.4 percent. Governor Romney agrees with him. I agree with him. So there is substantial support from both the President and his probable Republican opponent in the Presidential race for this next year. New loans, after July 1, which are now at 3.4 percent, would stay at 3.4 percent. The benefit to students who get the advantage of that lower rate--most other loans are at 6.8 percent by law--is about $7 a month, according to the Congressional Research Service.

All this talk is about offering students the benefit of about $7 a month for new loans. It is important to notice that no student who has a 3.4-percent loan today will see his or her interest rate go up. I will say that again. If you have a loan and you are going to the University of North Carolina and are paying 3.4 percent today, your rate will not go up on July 1. The law only affects new loans, and it doesn't affect 60 percent of loans. For 60 percent of those getting new loans after July 1, they will continue to pay the 6.8 percent set by Congress a long time ago.

I am glad the President is bringing this issue up, because the real driver of higher tuition and higher interest rates is the President's own policies--in two ways: The government and congressional Democrats who passed the health care law are actually overcharging students--all students--on student loans and using some of the money to pay for the health care law. These aren't just my figures. The CBO said when the new health care law passed, Congress took $61 billion of so-called savings--I call them profits on student loans--and it spent $10 billion to reduce the debt, $8.7 billion on the health care law, and the rest on Pell grants.

How does that work? How could Congress be overcharging students? Well, under the health care law, the government borrows money at 2.8 percent. The government then loans to students at 6.8 percent. That produces a profit. The Congressional Budget Office has said that the Congress could have lowered the interest rate from 6.8 to 5.3 percent and save all students $2,200 over the life of their average 10-year loan. I am introducing legislation today on my behalf and on behalf of others called the Student Interest Rate Reduction Act. This law proposes to keep the interest rate at 3.4 percent for subsidized Stafford loans beginning July 1 of this year, just as the President and Governor Romney proposed. We will pay for that by taking back the money that the Congress overcharged students on their student loans under the health care law.

This 1-year solution, as I said, will save students about $7 a month on interest payments on their new loans, or about $83 a year. It will cost the taxpayers about $6 billion, which will be paid for by reductions in savings from the new health care law.

Let's talk a moment about the real cost of tuition and student debt going up--that is, Federal health care policies. When I was Governor of Tennessee in the 1980s, the same thing would happen every year as I made up my State budget, and it is happening today in every State capital in America. I would work through all the things we had to fund with State tax dollars--the roads, the schools, the prisons, and the various State agencies. Then I would get down to the end of the budgeting process and have some money left. The choice would always be between Medicaid and higher education--our public colleges and universities. I spent my whole 8 years as Governor trying to keep the amount we gave to Medicaid down so that I could increase the

amount for colleges and universities, because I thought that was the future of our State.

In fact, we had a formula then that said if you went to a public college or university, the taxpayer would pay for 70 percent of it and the student would pay for 30 percent. If we raised your tuition, we would raise the State's share. We kept that 70/30. That is now turned completely around in Tennessee, where it is closer to 30/70 now; the student pays 30 percent and the taxpayers pay nearly 70 percent. This shift is because Medicaid mandates from Washington on every State have forced Governors and legislatures to take the money they would otherwise spend for public colleges and universities and spend it instead for Medicaid. As a result, State colleges and universities have less money, and to get more money, they must raise tuition.

When tuition goes up at the University of California, and you see students protesting, the reason is because of Washington. As I said, President Obama didn't invent this problem--this is a 30-year old problem--but he has made it worse. He made it worse with laws that say when States have less money, they have to spend more on Medicaid. If they are told from Washington to spend more on Medicaid, even though they have less revenues, they are going to spend less on something else. So they spend less on the University of California, or the State University of New York, or the University of Tennessee.

Last year in Tennessee, State funding for Medicaid went up 16 percent in actual dollars; as a result, State funding for community colleges and the University of Tennessee went down 15 percent in real cuts. That was not a cut in growth. That was a real cut. What did the state colleges and universities do? They raised tuition 8 percent. What did students do? They borrowed more money.

I have been trying to get this point across ever since I became a Senator. I said during the health care debate that everybody who voted for it ought to be sentenced to serve as Governor for 8 years in his or her State so they would understand this problem.

We cannot continue to order the States to spend more for Medicaid and expect our great colleges and universities to be affordable and continue to be the best in the world. That is the real reason why tuition is going up and loans are going up.

Here are the facts. There are still good options for students. I mentioned earlier that the average cost of tuition at a 4-year public university in America is about $8,200. For a community college, it is around $3,000. There are many scholarships to help them go there. It is true that loans are going up to very high levels. It is true that there are some abuses here and there--within the for-profit and other parts of the higher education system. But it is also true that in the United States we not only have some of the best colleges and universities in the world, we have almost all of them. Many of them are public colleges and universities. They are at risk today. Why? Because of Federal health care policies that are hamstringing States and soaking up the money that States should be using to fund the universities of this country and the community colleges of this country.

Mr. President, again, I am introducing today the Student Loan Interest Rate Reduction Act. It addresses exactly the subject President Obama is talking about on the campaign trail these days. How do we keep the interest rate on subsidized Stafford loans, the new loans that began July 1--how do we keep that at 3.4 percent for 1 year? Governor Romney supports that. President Obama supports that. I support that. The only difference is how we pay for it. It will cost $6 billion.

Our friends on the Democratic side have come up with their usual methods of paying for it: They are going to raise taxes on small business and people who create jobs.

We have a little better idea on this side, which is, let's take the $8.7 billion back that the Federal Government overcharges students on student loans today to help pay for the health care law and give it back to the students, and let's extend this for 1 year. That will leave nearly $3 billion extra, which we can use to shore up the Pell grant funding gap that is expected over the next couple of years.

Respectfully, I say to President Obama, when you visit the next college campus, tell the whole story. It is hard to attend and pay for college. There are many good options. Debt is up. But in fairness, the principal reason tuition is rising, and therefore debt is rising, is because of President Obama's own health care policy. He didn't start it, but he made it worse. What he has done is put into place a set of policies that are soaking up the money States would use to fund public colleges and universities and community colleges across this country, forcing them to use that money for Medicaid. As a result, the universities and community colleges have less money, they raise tuition, and that is the principal reason why we have higher tuition and higher interest rates.

The way to stop that would be to either repeal the health care law or repeal the Medicaid mandates. That would improve the quality of American public higher education, and it would improve access to higher education. It would slow down the rising of tuition and slow down the rising of student debt.

Mr. President, I rise today, along with Senator Warner, to reintroduce the Radio Spectrum Inventory Act. Simply put, in order to make more spectrum available to meet the growing demand for wireless broadband and other radio-based services, decision makers at the FCC, NTIA, and Congress must have a clear, detailed, up-to-date understanding of how spectrum is currently being used and by whom--data essential to sound policy decisions.

Specifically, the Radio Spectrum Inventory Act directs the National Telecommunications and Information Administration, NTIA, the Federal Communications Commission, FCC, with assistance from the Office of Science and Technology, to create a comprehensive and accurate inventory of each spectrum band, at a minimum, between 300 Megahertz to 6.5 Gigahertz. The information collected would include the licenses assigned in that band, number and type of end-user devices deployed, amount of deployed infrastructure, type of missions and activities supported in the band, as well as any relevant unlicensed end user devices operating in the band. This information is fundamental to constructing a comprehensive framework for spectrum policy.

The Radio Spectrum Inventory Act also provides more transparency related to spectrum use by creating a centralized website or portal that would include relevant spectrum and license information accessible by the public. Given that radio spectrum is a public good, we are obligated to provide the public more clarity and accountability on how it is being utilized by both Federal and non-Federal licensees. But let me be clear, given the sensitive nature of some spectrum assignments and allocations, this bill makes the appropriate disclosure exceptions for spectrum utilized or reserved for national security and public safety activities.

A comprehensive inventory is a critical step in reforming our spectrum policy and management. The FCC manages over 2 million active licenses and NTIA administers more than 450,000 frequency assignments. And while I appreciate the FCC's effort in conducting a ``baseline'' inventory and NTIA's evaluation--both the fast track and ten year plan--I do not believe they are sufficient substitutes to conducting a full inventory since those efforts were limited in scope and seemingly didn't capture or make available more detailed data on spectrum use.

In addition, there has been a growing call for a comprehensive spectrum inventory from Members of Congress, former FCC officials, and industry--even the House Energy & Commerce Committee bipartisan Federal Spectrum Working Group requested what amounts to a complete inventory of Federal frequency assignments between 300 MHz and 3 GHz. But if we are to examine Federal use, we must also look at non-Federal use in order to gain a truly comprehensive picture and understanding of the heterogeneous spectrum ecosystem.

The ultimate goals this legislation sets the path towards achieving are to implement more efficient use of spectrum and to locate additional spectrum to meet the future demands of all spectrum users-- commercial, Federal, and military. A comprehensive inventory would yield a significant amount more of data that would be extremely useful for conducting measurements, implementing more robust management, and developing greater strategic planning of spectrum resources.

With the enactment of P.L. 112-96 earlier this year, Congress took a notable but incremental step in an effort to free up additional spectrum to meet the growing demand of wireless broadband. As I have stated before, I believe more can and must be done to meet the future needs of all spectrum users and properly address existing spectrum challenges. This includes a comprehensive spectrum inventory, more strategic and longterm planning of spectrum resources, and greater collaboration between the FCC and NTIA. In addition, we must also continually promote more investment in infrastructure and foster greater technical innovation. That is why I sincerely hope that my colleagues join Senator Warner and me in supporting this critical legislation and continuing our focus on implementing spectrum reform.

Mr. President, I rise today, along with Senator Warner, to reintroduce pro-consumer wireless legislation, which will improve wireless coverage indoors. Specifically, the Federal Wi-Net Act would require the installation of small wireless base stations, such as femtocells or similar technologies, and Wi-Fi hot-spots in all publicly accessible Federal buildings to improve wireless coverage and network capacity.

Over the past several years, there has been growing concern about a looming spectrum crisis given the significant growth in the wireless industry. Currently, there are more than 331 million wireless subscribers in the U.S., and American consumers used more than 2.3 trillion minutes in 2010--that is more than 6.4 billion minutes per day. And while the foundation for wireless services has been voice communication, more subscribers are utilizing it for broadband. According to Cisco, global mobile data traffic grew 159 percent in 2010, nearly tripling for the third year in a row. That growth is only expected to continue--there is expected to be over seven billion mobile devices globally by 2015 producing more than six exabytes per month. To put it in context, all the words ever spoken by human beings would equate to five exabytes worth of data.

To meet this growing demand, a multi-faceted solution is required that includes fostering technological advancement and more robust spectrum management. Technologies, such as femtocells, distributed antenna system, DAS, and Wi-Fi hotspots, will help alleviate growing wireless demand by offloading that traffic onto wireline broadband networks. The Chairman of the Federal Communications Commission recently announced plans to open a proceeding on utilizing small cells in the 3.5 GHz band. And a recent spectrum report by the President's Council of Advisors on Science and Technology, PCAST, highlighted how reducing cell sizes of wireless networks to femtocell or Wi-Fi ranges could provide 400 times as much aggregate network capacity than current macro cells network topologies.

To that point, the need is there--approximately 40 percent of cell phone

calls are made indoors and more than 26 percent of U.S. households have ``cut-the-cord,'' relying solely on cell phones to make voice calls. On the data side, Cisco's Virtual Network Index reports approximately 60 percent of mobile Internet use is done inside--either at home or at work. Consumers are also utilizing Wi-Fi more frequently--more than 80 percent of smartphone users prefer Wi-Fi connections over cellular for mobile data usage, and approximately 75 percent of tablet users use Wi- Fi connections only. In addition, several new tablets, such as the Microsoft Surface, Google Nexus 7, and Samsung Galaxy Tab, were introduced as Wi-Fi only versions.

As the FCC's National Broadband Plan highlights, most smartphones sold today have Wi-Fi capabilities to take advantage of the growing ubiquity of Wi-Fi routers and devices. According to a May 2011 report from comScore, approximately 48 percent of all iPhone traffic was transported over Wi-Fi/LAN networks. So installing more mini-base stations, such as femtocells, DAS, and Wi-Fi hotspots will improve indoor coverage and wireless network capacity. It will also increase battery life of phones and tablets since the indoor signal will be stronger so devices will use less power.

The increasing importance of wireless communications and broadband has a direct correlation to our nation's competitiveness, economy, and national security and therefore demands we make the appropriate changes to current spectrum policy and management to avert a spectrum crisis and continue to realize the boundless benefits of spectrum-based services. Congress has taken some steps but more must be done. That is why I sincerely hope that my colleagues join Senator Warner and me in supporting this important legislation.

Mr. President, I rise today to urge my colleagues to support a one-year extension of the Small Business Administration, SBA, 504 loan refinancing program that was originally authorized in the Small Business Jobs Act of 2010. This bill would allow small business owners to use 504 loans to refinance up to 90 percent of existing commercial mortgages.

The 504 loan program provides approved small businesses with long- term, fixed-rate financing used to acquire fixed assets for expansion or modernization. According to the SBA, as of February 15, 2012, the $50 billion in 504 loans has created over 2 million jobs. The refinancing option in the Small Business Jobs Act authorized $7.5 billion in refinancing until September 27, 2012. Unfortunately, because of a delay in promulgating regulations to enable refinancing, the program did not become operational until a few months ago, significantly shortening the period of time that business could refinance existing 504 loans. The 504 loan program also comes at no cost to taxpayers, has created jobs and will provide much needed relief to businesses for one additional year.

America's small business owners face a daunting business life cycle that is volatile at best: according to the SBA, while seven out of 10 new employer firms survive for at least 2 years, only \1/3\ of these firms exist after 10 years. These failure rates are quite constant for different industries. Yet one factor that is a bell-weather for success is access to capital. The SBA identifies the

major factors in a firm's survivability as including: an ample supply of capital, being large enough to have employees, the owner's education level, and the owner's reason for starting the firm.

Clearly, the drive of an entrepreneur is a major factor in start-ups where statistics from the 2008 ``Report to the President on the Small Business Economy'' delivered by SBA's Office of Advocacy, show that in 2005, more than 12 million individuals were involved in starting 7 million ventures. After six years, only one third of entrepreneurs have a working business despite the fact that they put in 9.9 billion hours of uncompensated time in 2005 launching their businesses. These uncompensated hours represented 2.7 percent of total paid work in the United States that year and almost one half of the hours for all American self-employed workers. That is an incredible effort of time and talent and a show of great risk taking.

A number of small businesses utilize 504 loans as long-term, fixed- rate financing used to acquire fixed assets for expansion or modernization. These 504 loans are made available through Certified Development Companies, CDCs, SBA's community based partners for providing 504 loans. The 504 loan program offers small businesses both immediate and long-term benefits, so business owners can focus on growing their business. These benefits include 90 percent financing, longer loan amortizations, no balloon payments, fixed-rate interest rates, and savings that result in improved cash flow for small businesses.

Generally, a business must create or retain one job for every $65,000 guaranteed by the SBA under this program. Small manufacturers must create or retain a ratio of one job for every $100,000 guaranteed. In addition, the 504 program serves to revitalize a business district, expand exports, promote small businesses owned and controlled by women, minorities and veterans, especially service-disabled veterans, aid rural development, and increase productivity and competitiveness.

As I mentioned at the outset of my remarks, the 504 program is a job creator that does not receive any appropriated funds. The 1-year extension of the refinancing for the 504 loan program will allow businesses to retain employees and it also comes at zero cost to taxpayers. These are solid measures that will help small businesses at a time when many small enterprises are struggling to keep their employees and run basic operations. I ask my colleagues to support this legislation as swiftly as possible, as our Nation's capital-starved small businesses deserve no less.

Mr. President, I rise today to urge my colleagues to support a one-year extension of the Small Business Administration, SBA, 504 loan refinancing program that was originally authorized in the Small Business Jobs Act of 2010. This bill would allow small business owners to use 504 loans to refinance up to 90 percent of existing commercial mortgages.

The 504 loan program provides approved small businesses with long- term, fixed-rate financing used to acquire fixed assets for expansion or modernization. According to the SBA, as of February 15, 2012, the $50 billion in 504 loans has created over 2 million jobs. The refinancing option in the Small Business Jobs Act authorized $7.5 billion in refinancing until September 27, 2012. Unfortunately, because of a delay in promulgating regulations to enable refinancing, the program did not become operational until a few months ago, significantly shortening the period of time that business could refinance existing 504 loans. The 504 loan program also comes at no cost to taxpayers, has created jobs and will provide much needed relief to businesses for one additional year.

America's small business owners face a daunting business life cycle that is volatile at best: according to the SBA, while seven out of 10 new employer firms survive for at least 2 years, only \1/3\ of these firms exist after 10 years. These failure rates are quite constant for different industries. Yet one factor that is a bell-weather for success is access to capital. The SBA identifies the

major factors in a firm's survivability as including: an ample supply of capital, being large enough to have employees, the owner's education level, and the owner's reason for starting the firm.

Clearly, the drive of an entrepreneur is a major factor in start-ups where statistics from the 2008 ``Report to the President on the Small Business Economy'' delivered by SBA's Office of Advocacy, show that in 2005, more than 12 million individuals were involved in starting 7 million ventures. After six years, only one third of entrepreneurs have a working business despite the fact that they put in 9.9 billion hours of uncompensated time in 2005 launching their businesses. These uncompensated hours represented 2.7 percent of total paid work in the United States that year and almost one half of the hours for all American self-employed workers. That is an incredible effort of time and talent and a show of great risk taking.

A number of small businesses utilize 504 loans as long-term, fixed- rate financing used to acquire fixed assets for expansion or modernization. These 504 loans are made available through Certified Development Companies, CDCs, SBA's community based partners for providing 504 loans. The 504 loan program offers small businesses both immediate and long-term benefits, so business owners can focus on growing their business. These benefits include 90 percent financing, longer loan amortizations, no balloon payments, fixed-rate interest rates, and savings that result in improved cash flow for small businesses.

Generally, a business must create or retain one job for every $65,000 guaranteed by the SBA under this program. Small manufacturers must create or retain a ratio of one job for every $100,000 guaranteed. In addition, the 504 program serves to revitalize a business district, expand exports, promote small businesses owned and controlled by women, minorities and veterans, especially service-disabled veterans, aid rural development, and increase productivity and competitiveness.

As I mentioned at the outset of my remarks, the 504 program is a job creator that does not receive any appropriated funds. The 1-year extension of the refinancing for the 504 loan program will allow businesses to retain employees and it also comes at zero cost to taxpayers. These are solid measures that will help small businesses at a time when many small enterprises are struggling to keep their employees and run basic operations. I ask my colleagues to support this legislation as swiftly as possible, as our Nation's capital-starved small businesses deserve no less.