Encouraging Success Act

Mr. Speaker, I yield myself such time as I may consume.

Mr. Speaker, I thank my colleagues, Representatives Ellzey and Thanedar, for their work on this bill, the Encouraging Success Act.

The 8(a) program is one of the most effective tools for minority businessowners to get their foot in the door of the Federal marketplace.

The program is critical for entrepreneurs who have faced discrimination. This bill requires the SBA to regularly assess, and, when necessary, update the economic threshold for program participation.

I share the sponsors' concerns that the lack of reassessment or readjustment can penalize growth and that a regular assessment will ensure that the program keeps pace with changing economic environments.

Mr. Speaker, the National Minority Supplier Development Council has said that this legislation will enhance the effectiveness of SBA programs, including the esteemed 8(a) program, ensuring they continue to serve as powerful catalysts for community wealth building and inclusive economic development.

The 8(a) program remains a win-win for the government and for communities across the country. It has led to

a more diverse Federal market and supply chain, provided billions of dollars annually through streamlined contracting processes for minority businessowners, and continues to work to help minority businessowners overcome the real and ongoing discrimination that would otherwise hold them back.

Keeping 8(a) intact and relevant must remain a top priority. I appreciate the sponsors for their work, and I reserve the balance of my time.

Mr. Speaker, again, I appreciate the great work of my colleagues on this bill, and I yield myself the balance of my time.

I will close by noting that 3 weeks ago, the committee held a hearing on small business size standards and contracting policies and the barriers they can pose to growth.

As we discussed, the Federal Government needs to both recruit and retain small business government contractors.

We are seeing that retaining small firms, like those in the 8(a) program, is a necessity for the health of the industrial base.

This bill will contribute to the retention of growing small businesses. It is a productive step designed to ensure that minority businessowners can succeed, thrive, and grow in the Federal marketplace and beyond.

Mr. Speaker, I yield back the balance of my time.

Mr. Speaker, I move to suspend the rules and pass the bill (H.R. 6591) to amend section 8(a) of the Small Business Act to require the Administrator of the Small Business Administration to regularly reassess the asset and net worth thresholds for qualifying as an economically disadvantaged individual, and for other purposes, as amended.

Mr. Speaker, I ask unanimous consent that all Members may have 5 legislative days in which to revise and extend their remarks and include extraneous material on the bill.

Mr. Speaker, I yield myself such time as I may consume.

Mr. Speaker, I rise today in support of H.R. 6591, the Encouraging Success Act, sponsored by the gentleman from Texas (Mr. Ellzey), my good friend.

The 8(a) program allows certain small businesses to compete for valuable contracting opportunities. However, SBA regulations threaten to remove the participating firms if the owner reaches certain financial thresholds. While these thresholds are necessary to ensure that only true small businesses are utilizing this program, it can force some small business owners to make a tough decision: proactively stop expanding their business so they can stay in the program or grow outside the limits set by the SBA and get kicked out of the program.

I spoke with a female veteran in my district who was facing this exact issue. The bill doesn't solve all the issues in this program, but it requires the SBA to reassess the 8(a) asset threshold cap every 4 years, ensuring it is in line with market realities.

Mr. Speaker, I urge my colleagues to vote for H.R. 6591, the Encouraging Success Act, and I reserve the balance of my time.

Mr. Speaker, I yield such time as he may consume to the gentleman from Texas (Mr. Ellzey).

Mr. Speaker, I urge my colleagues to support this commonsense legislation from Congressmen Ellzey and Thanedar, and I yield back the balance of my time.

Mr. Speaker, I thank Chairman Williams and Ranking Member Velazquez for allowing me to lay out H.R. 5961, the Encouraging Success Act. Bipartisanship on this committee is alive and well, and I thank Congressman Thanedar for joining me on this bill.

The Small Business Administration's 8(a) program was established in the 1970s to help small businesses compete with large corporations for U.S. Government contracts.

A qualifying small business can only be a part of the program for 9 years. To initially qualify and remain in the 8(a) program, there is a cap to the value of a small business' assets.

Since the program's inception, the asset cap has only been raised twice and is currently at the very small amount of $6.5 million.

The asset threshold is set through an SBA-determined regulation, and the law does not outline any process of when or how the SBA should reassess the threshold to remain in line with market changes.

Unfortunately, because the requirements to initially qualify for the program or to remain in it haven't kept up with market changes, the cap is set to a level at which a small business is disadvantaged to compete in the open market at the end of the 9-year program.

The SBA's slow-to-change attitude with the asset cap can limit the success of an 8(a) small business or outright kill it.

With the threat of being graduated out of the 8(a) program, small business owners must decide whether their firm's growth is worth being removed from the program.

Our bill, H.R. 6591, helps solve the situation and encourages success of small businesses by compelling the SBA administrator to review the qualification caps with greater frequency to ensure that small businesses participating in the 8(a) program are allowed to grow big enough to compete with larger companies, once their participation in the program ends. We ask for your support for H.R. 6591.