Floor Statements

Mr. Speaker, I rise today to recognize John Russell, Chairman of the Board of Directors for CMS and Consumers Energy, for the dedication of the John G. Russell Leadership Center in Grand Rapids, Michigan. Customer-focused and data-driven, John has inspired countless employees to accomplish extraordinary things, and with the opening of this center, his legacy will continue to train and motivate leaders for generations to come.

During his 35-year career in the energy industry, John valued leadership and was deeply committed to developing strong, capable leaders throughout the company. He challenged the organization to consistently deliver breakthrough results and leave Michigan better than he found it.

A longtime Grand Rapids resident, John was President and Chief Executive Officer of CMS and Consumers Energy from May 2010 to July 2016. He was named Chairman of the Boards of CMS and Consumers Energy in May 2016.

John also served on the boards of Grand Valley State University, Business Leaders for Michigan, Michigan Chamber of Commerce, Hubbell Inc. and The Right Place Inc.

Mr. Speaker, I ask my colleagues to join me in honoring John Russell for his outstanding leadership and commitment to the state of Michigan.

Mr. Speaker, I rise today to recognize Jeff Cook, Vice President of Eagle Alloy Inc. in Muskegon, Michigan, for his long-term contributions to Eagle Alloy and the U.S. metalcasting industry. Eagle Alloy is an innovative steel foundry providing vital castings for key sectors including agriculture, construction, mining, defense and railroads. Metal castings are integral to virtually all U.S. manufacturing activities. Jeff joined Eagle Alloy in 1986 after graduating high school. His first position on the shop floor was as a grinder, machining castings on the third shift. He has worked his way up over the past thirty years to become Vice President of Sales and Marketing.

Jeff is passionate about attracting the next generation to the metalcasting industry and has dedicated significant amount of time reaching out to local schools and businesses about careers in the metal casting industry. In addition, he has been actively involved in the leadership of the local American Foundry Society (AFS) West Michigan Chapter for many years. He joined the AFS National Board of Directors in 2011, where he spent the past year as its President traveling across the country, meeting with thousands of metalcasters and suppliers underscoring the importance of taking time to ``Attract. Educate. Support'' the next generation of metalcasters. AFS is the major trade and technical association for the North American metalcasting industry. The association has more than 8,000 members representing over 2,000 metalcasting firms, their suppliers and customers.

In Muskegon, Jeff has reached out to educational institutions, including local high schools and Muskegon Community College, to better communicate the skills needed and the certifications that are in demand in the industry. Through the AFS chapter, Jeff has worked with local schools to host student night, where they showcase the traveling casting kit, known as Foundry in a Box. It shows students how to form patterns, melt them, the cleanup process behind it, and gives an overview of how castings are made.

Mr. Speaker, it is with great pleasure that I congratulate Jeff Cook, as he completes his

successful term as AFS President, for his strong commitment and dedication to Eagle Alloy and to the growth and prospering of the metalcasting industry.

Mr. Speaker, pursuant to House Resolution 242, I call up the bill (H.R. 1219) to amend the Investment Company Act of 1940 to expand the investor limitation for qualifying venture capital funds under an exemption from the definition of an investment company, and ask for its immediate consideration in the House.

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

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

Mr. Speaker, we all know that small businesses and entrepreneurs are the heartbeat of the American economy. Access to financial capital is vital for entrepreneurs seeking to start up, operate, or expand their businesses. However, gaining access to capital has remained an enduring challenge for many small businesses.

The financial crisis and the Great Recession made the situation worse, frankly, as capital became increasingly hard to access from institutional banks and various capital market players. While conditions have improved somewhat in recent years, many entrepreneurs continue to struggle with accessing the capital they need to compete and to grow.

In order to succeed, these companies need capital and credit, the lifeblood for growth, expansion, and job creation. Yet the government continues to construct arbitrary walls that cut them off from essential financing, as smaller companies are caught in a sea of regulatory red tape created by Washington bureaucrats.

We know that 60 percent of all net new jobs that have come into this country, that have been created here in the United States, come from these small businesses. They are oftentimes S corporations, LLCs, sole proprietorships. Small companies often have such owners also be operators. They are working alongside their fellow employees.

That 60 percent of those jobs that have been created here in the United States isn't just a one-time blip. That is over the last 20 years, the last two decades, that we have seen that trend.

Congress has made strides in tailoring the regulatory environment for smaller companies, no doubt, most notably when we passed, with strong bipartisan support, the Jumpstart Our Business Startups, or JOBS, Act in 2012. This was a bipartisan bill that was signed into law by President Obama. The JOBS Act's benefits are notable as more and more companies use its provisions to raise investment capital in both the public and private markets.

The JOBS Act has raised the cap on investors in a privately held company from 500 to 2,000 investors, but the limit on the number of investors acting as a coordinated group to invest in a company remained at 100, where it has been since 1940, some 77 years ago.

As noted by Kevin Laws of AngelList in his written testimony before our Capital Markets Subcommittee: ``With online fundraising and general solicitation becoming more common because of the JOBS Act, companies are bumping up against the limit more frequently. The current limit . . . now acts as a brake on the amount of money the company wanted to raise, leaving tens of millions of dollars on the table that did not go into startups.''

While H.R. 1219, the Supporting America's Innovators Act, a bipartisan bill introduced by the vice chairman of our Financial Services Committee, Representative Patrick McHenry, and Nydia Velazquez of New York, would amend the cap currently contained in the Investment Company Act to allow 250 investors for a ``qualified venture capital fund,'' therefore enhancing angel investors' ability to provide important funding to small businesses.

This bill is a very modest increase to the current exemption that has been in place for nearly 77 years. Modernizing this cap is long overdue and reflects today's capital markets and the reality of the increasingly important role that angel investors and others play as they commit the funds necessary to help small businesses grow.

The Securities and Exchange Commission, unfortunately, continues to ignore the backlog of good ideas to spur capital formation, which is recommended by entrepreneurs, small businesses, and market participants from their annual SEC Government-Business Forum on Capital Formation. This is a forum that is put together annually. They take and solicit ideas. They want to hear from people that are in the marketplace to figure out what ways they could go to improve that. Unfortunately, they have not acted on

this, and in the SEC's absence, Congress must act to promote market efficiency and capital formation.

I think we can all agree that we support smart regulation that protects investors and maintains orderly and efficient markets. But outdated, excessive, and unnecessary regulation whose costs outweigh benefits is dumb regulation that overburdens smaller companies. Let's provide some regulatory relief by enacting the bipartisan bill that will ease the burdens on small businesses and job creators and help foster capital formation and get Americans back to work.

Mr. Speaker, I would also like to note, in a hearing that we had on this bill last Congress, it passed our committee 52-2, including the ranking member voting for it. There were no dissenting minority views that were offered, and no amendments were offered at the Rules Committee on this. We have got a lot of consensus. I believe this is the right thing to do to move forward.

Mr. Speaker, I reserve the balance of my time.

Mr. Speaker, I yield 2 minutes to the gentleman from North Carolina (Mr. McHenry), our vice chairman and the sponsor of this bill.

Mr. Speaker, I yield 2 minutes to the gentleman from Ohio (Mr. Chabot), the chairman of the Committee on Small Business here in the House of Representatives and a strong supporter of this bill.

Mr. Speaker, I yield 2 minutes to the gentleman from Illinois (Mr. Hultgren), the vice chairman of our Subcommittee on Capital Markets, Securities, and Investments.

Mr. Speaker, I yield 2 minutes to the gentleman from Maine (Mr. Poliquin).

Mr. Speaker, I yield 2 minutes to the distinguished gentleman from Arkansas (Mr. Hill).

Madam Speaker, I yield 2 minutes to the gentleman from Minnesota (Mr. Emmer).

Madam Speaker, may I inquire as to the balance of time each side has left?

Madam Speaker, I yield 2 minutes to the gentleman from Ohio (Mr. Davidson).

Madam Speaker, I yield 2 minutes to the gentleman from Indiana (Mr. Hollingsworth), a new member of our Financial Services Committee.

Madam Speaker, I yield as much time as he may consume to the gentleman from Texas (Mr. Hensarling), chairman of the Financial Services Committee.

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

Madam Speaker, as I close on this very important bill that we have been talking about, H.R. 1219, I just want to say congratulations to our sponsors, Congressman McHenry and Congresswoman Velazquez, for their leadership on this, as well as my Capital Markets, Securities, and Investments Subcommittee ranking member, Representative Maloney, for working together to advance this commonsense bill.

As was pointed out by both the chairman and the ranking member, there is strong bipartisan consensus that this bill is a winner for the American people. Some people today, as they tee off the Masters, we might say it is a 6-inch putt for the American people knowing that this is good for them and good for the economy.

I want to encourage all of my colleagues on both sides of the aisle to support this bill, H.R. 1219.

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

Madam Speaker, on that I demand the yeas and nays.

Mr. Speaker, I appreciate the opportunity to rise, and I do feel like, to clarify, the bill title of H.R. 1219 is Supporting America's Innovators Act.

Our colleagues have seen time and time and time again that the other side has wanted to come to the floor and talk about everything other than what we are dealing with. But I do want to lay out, as one of the senior members of the committee, what has happened in Financial Services when we have dealt with this.

Last Congress, this exact bill passed 52-2 in the committee, with the ranking member supporting the bill. There were no dissenting minority views that were offered. And now, with this particular piece of legislation, H.R. 1219, there were no amendments even offered at the Rules Committee.

So which is it? My friends across the aisle complain when we don't do regular order. They complain if this had gone on suspension. I am kind of reminded of Groucho Marx in his movie, ``Horse Feathers.'' Whatever that is, I am against it. That seems to be their attitude.

But I do look forward to working with my colleagues across the aisle to make sure that they join me in supporting government funding when we are going to be dealing with that here shortly.

So on to our bill here, H.R. 1219, unless the opposition, the other side of the aisle, would like to continue to talk about a lot of nongermane things; I will keep bringing up Susan Rice and her illegally unmasking people if they would like to do that. We can continue with that conversation.

I would prefer to talk about H.R. 1219. So we know that small businesses and entrepreneurs are the heartbeat of the American economy, and access to financial capital is vital for entrepreneurs seeking startup money, or to operate, or to expand their businesses. However, gaining access to capital has remained an enduring challenge for small businesses.

The financial crisis and the Great Recession made the situation worse as capital became increasingly hard to access from institutional banks and various capital players. And while conditions have improved somewhat in the recent years, many entrepreneurs continue to struggle with accessing the capital that they need to compete and to grow.

In order to succeed, these companies need capital and credit, which is the lifeblood for growth, expansion, and job creation. Yet the government continues to construct arbitrary walls that cut them off from essential financing as smaller companies are caught in a sea of regulatory red tape created by Washington bureaucrats oftentimes.

As we had a similar bill yesterday, I made the point at that time as well. We know that 60 percent of all net new jobs that have been created here in the United States, 60 percent of all net new jobs that have been created here over the last 2 decades, have come from these small businesses.

Congress has made strides in tailoring the regulatory environment for these smaller companies--most notably when we passed, with strong bipartisan support, the Jumpstart Our Business Startups Act, or JOBS Act, in 2012. That was a bipartisan bill that was signed by President Obama.

The JOBS Act's benefits are notable as more and more companies use its provisions to raise investment capital in both the public and the private markets. And the JOBS Act raised the cap on investors in a privately held company from 500 to 2,000 investors, but the limit on the number of investors acting as a coordinated group to invest in a company remained at 100, where it has been since 1940, some 77 years ago. I think it is about time that we update that.

As noted by Kevin Laws, of AngelList in his written testimony before the Capital Markets Subcommittee: ``With online fundraising and general solicitation becoming more common because of the JOBS Act, companies are bumping up against the limit more frequently. The current limit . . . now acts as a brake on the amount of money the company wanted to raise, leaving tens of millions of dollars on the table that did not go into startups.''

Well, H.R. 1219, the Supporting America's Innovators Act, a bipartisan bill introduced by Representatives Patrick McHenry and Nydia Velazquez, would amend the cap currently contained in the Investment Company Act to allow 250 investors, instead of that 100, for a qualified venture capital fund, and, therefore, enhance angel investors' ability to provide important funding to our small businesses.

This bill is a very modest increase to the current exemption which has been in place for nearly 77 years, since 1940. Modernizing the cap is long overdue and reflects today's capital markets realities and the increasingly important role that angel investors play as they commit the funds necessary to help these small businesses grow.

The Securities and Exchange Commission continues to ignore the backlog of good ideas to spur capital formation recommended by entrepreneurs, small businesses, and market participants at the SEC's annual government-business forum on capital formation. So in the SEC's absence, Congress must act to promote market efficiency and capital formation. That is what we are here to do today, and I do think that that is an extremely important thing for us to do here in Congress.

I think that we can all agree that we support smart regulation that protects investors and maintains orderly and efficient markets.

I think we can all agree that we need to support smart regulation that protects investors and maintains orderly and efficient markets. But outdated, excessive, and unnecessary regulation where costs outweigh the benefits is just dumb regulation that overly burdens smaller companies.

So let's provide some regulatory relief by enacting this bipartisan bill that will ease the burdens on small businesses and job creators to help foster capital formation and get Americans back to work.

Mr. Speaker, small businesses and entrepreneurs are what drive the American economy. I meet with these folks all the time when I am back home in the Second District, as I know my colleagues do when they are back in their districts, and we see firsthand the benefits that these people's dreams, their innovations, their hard work, and as they provide to our communities that inspiration.

These innovators, entrepreneurs, and risk-takers are critical to our country's economic growth and prosperity. In fact, small businesses are responsible for more than 60 percent of all of the net new jobs. Let me repeat that. Small businesses are responsible for more than 60 percent of all the net new jobs over the past two decades. This isn't just a one-time blip. This is over the last two decades.

So if our Nation is going to have an economy that provides opportunities for every American, then we must promote and encourage success and growth for our small businesses, our startups, and our entrepreneurs. It is this notion that I think brings us to this legislation we are discussing here today.

H.R. 1343, the Encouraging Employee Ownership Act, would simply level the playing field for small companies by updating Federal rules that allow small businesses to better compensate their employees with ownership in those businesses.

Currently, the SEC rule 701 permits private companies to offer their own securities as part of written compensation agreements with employees, directors, general partners, trustees, officers, or other certain consultants without having to comply with rigid Federal securities registration requirements. The SEC rule 701, therefore, allows small companies to reward their employees.

Despite the SEC having the authority to increase the $5 million threshold via a rulemaking, the SEC has once again chosen to prioritize what, I would argue, are highly politicized regulatory undertakings instead of focusing on its core mission, which includes the facilitation of capital formation. That is one of the key core jobs of the Securities and Exchange Commission. Well, if the SEC isn't going to focus its priorities, then Congress will help them do that. So that is why we are here today on this bill.

I believe it is imperative that small businesses not only in West Michigan, but across America, have the ability to compete. A critical element of competition and success is, first, that small businesses be able to offer compensation packages that attract and retain top-tier talent in their fields. In today's world, that includes rewarding employees with stock options. To me, this is common sense. Small- business employees have a clear and vested interest in the success of their employers, and oftentimes they are attracted to it.

I know, having some younger children myself that are coming into adulthood, they are looking for that excitement. They are looking for that opportunity. They are looking to be builders themselves.

Well, by increasing the rule 701 threshold to $10 million, it will give these private companies more flexibility to attract, reward, and retain those employees. This simple change would allow companies to offer twice as much stock to their employees annually without having to trigger additional disclosure information to investors about those compensation packages that include securities offerings.

By reforming this regulatory burden, Mr. Speaker, startups, small businesses, and emerging growth companies will be better equipped to attract highly talented individuals from companies that are better capitalized and able to provide cash compensation. By incentivizing employees with stock options, small businesses will now be able to compete on a more level playing field in order to retain those valuable employees rather than seeing them flee to cash, frankly.

This bill is an example, I believe, of positive, bipartisan results that can be achieved when Republicans and Democrats reach across the aisle. I commend our sponsors of the bills, Representative Hultgren, who spoke a little earlier; Representatives Delaney, Higgins, MacArthur, Sinema, and Stivers, for their leadership on this issue; and my friend from Colorado, as well, and what he is doing.

I encourage all my colleagues to support this rule and the underlying bill.

Mr. Speaker, I yield myself such time as I may consume, and I thank the chairman for his leadership on this particular issue.

Mr. Speaker, small businesses and entrepreneurs are what drive the American economy. I meet with them in my district, the Second District of Michigan, all the time. I know my colleagues do as well back in their districts.

We see them firsthand. We see firsthand the benefits that their dreams, their innovations, their inspiration, and their hard work provide to our communities.

These innovators, entrepreneurs, and risk-takers are critical for our country's economic growth and prosperity. In fact, small businesses are responsible for 60 percent of the Nation's net new jobs over the past two decades. Not 2 years, not 10 years, but over the last 20 years, the last two decades.

If our Nation is going to have an economy that provides opportunity for every American, then we must promote and encourage success and growth in our small businesses and our startups. It is this notion that brings us this legislation we are discussing today.

H.R. 1343, Encouraging Employee Ownership Act, would simply level the playing field for small companies by updating Federal rules that allow small businesses to better compensate their employees with ownership in their own businesses.

Currently, Securities and Exchange Commission rule 701 permits private companies to offer their securities as part of written compensation agreements to employees, directors, general partners, trustees, officers, or certain consultants without having to comply with rigid Federal securities registration requirements. SEC rule 701, therefore, allows small companies to reward its employees.

Despite the SEC having the authority to increase the $5 million threshold disclosure via rulemaking, the SEC has once again chosen to prioritize highly politicized regulatory undertakings instead of focusing on its core mission. That mission includes facilitating capital formation. If the SEC cannot or will not focus its priorities, Congress will.

It is imperative that small businesses in west Michigan, all of Michigan, and across America have the ability to compete. A critical element of competition and success is for those small businesses to be able to offer compensation packages that attract and retain top-tier talent.

In today's world, that includes rewarding employees in stock options. To me, this just makes common sense. Small-business employees have a clear and vested interest in the success of their employer.

By increasing the rule 701 threshold to $10 million, it will give private companies more flexibility to attract, reward, and retain those highly valuable employees. This simple change will allow companies to offer twice as much stock to their employers annually, as they currently can, without having to trigger additional disclosure information to investors about compensation packages that include these security offerings.

By reforming this regulatory burden, startups, small businesses, and emerging growth companies will be better equipped to attract highly talented individuals from companies that are better capitalized and able to maybe provide some additional cash compensation.

By incentivizing employees with stock options, small businesses will now be able to compete on a more level playing field with older, larger, and maybe more established companies. They are going to be able to retain their invaluable employees as well.

This bill is an example of the positive bipartisan results that can be achieved when Republicans and Democrats reach across the aisle. I commend the sponsors of the bill, Representatives Hultgren, Delaney, Higgins, MacArthur, Sinema, and Stivers for their leadership on this issue. I encourage my colleagues to support H.R. 1343.

Mr. Speaker, I reserve the balance of my time.

Mr. Speaker, I yield 2 minutes to the gentleman from Missouri (Mr. Luetkemeyer), my fellow subcommittee chairman.

Mr. Speaker, I yield such time as he may consume to the gentleman from Illinois (Mr. Hultgren), the author of this legislation.

Mr. Speaker, I yield such time as he may consume to the distinguished gentleman from Arkansas (Mr. Hill).

Mr. Speaker, may I inquire as to the balance of time remaining on each side?

Mr. Speaker, I yield 3 minutes to the gentleman from Georgia (Mr. Loudermilk).

Mr. Speaker, I yield 2 minutes to the gentleman from Michigan (Mr. Trott), my fellow Michiganian.

Mr. Speaker, I yield 2 minutes to the gentleman from New York (Mr. Zeldin).

Mr. Speaker, may I inquire as to the balance of time remaining on each side?

Mr. Speaker, I yield 2 minutes to the gentlewoman from New York (Ms. Tenney).

Mr. Speaker, I yield myself the balance of my time to close.

My colleague on the other side is trying to maybe split some hairs. We heard some rhetoric earlier on the floor here which, I think, shows why many on both sides of the aisle scratch their heads in opposition to this bill. We heard about monied interests. We heard about corporate wish lists. We heard about Enron which is, by the way, a publicly traded company which has absolutely nothing to do with this bill. Now, that all might play really well on a leftwing political base, but that is detached from the realities of what our economy is about.

As we have talked, 60 percent of all new job creation happens in small businesses. These are not corporations. These are LLCs, limited liability corporations. These are subchapter S sole proprietorships. These are small entrepreneurs and innovators.

By the way, I looked up the definition of innovator. It is a person who introduces new methods, ideas, or products. Those are the kind of dynamic elements that we are seeing here. And I think this confusion between corporations and Enron and what we are trying to do here is really a disservice to the American people.

This is about making sure that we update basically an inflation escalator from 1988. We update a rule that the SEC could have the power to do, which it has not done, that benefits employees and benefits those owner-employer's workers who oftentimes, more often than not, work alongside their employees. So they are the ones who are seeing this on a daily basis.

I can just say to you that, as was pointed out by my colleague from across the aisle from Maryland, if we don't do this, what most of those small businesses are going to do is say: You know what, it is just not worth the effort; I am not going to do it. And we will see that lack of upside going to those employees.

As was pointed out by my fellow colleague from Michigan, this is beyond their salary, this is beyond bonuses. This is an additional way to make sure that those relationships get cemented in.

So, at a minimum, all you would be doing is voting to confirm the inflation escalator from 1988. It is not a radical change to the law. This is a commonsense, I believe, innovative way of trying to make sure that this next generation of workers has the ability to really reap the benefits of success here in the United States.

I yield back the balance of my time.

Mr. Speaker, I claim the time in opposition to the motion.

Mr. Speaker, I just want to point out a couple of things.

The Senate Banking Committee has moved an identical bill forward, unanimously, recently.

Regarding the subject matter that the gentleman from California was throwing out, this bill is not about anything other than providing hardworking Americans an opportunity to succeed. It is not about relitigating the last election or even about Susan Rice illegally unmasking American citizens. This is about an underlying bill that will help American citizens.

I urge my colleagues to vote ``no'' on this motion to recommit, and I urge them to vote ``yes'' on the underlying bill.

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

Mr. Speaker, on that I demand the yeas and nays.

Madam Speaker, on that I demand the yeas and nays.

Mr. Speaker, I rise today regarding missed votes due to my attendance at the White House for the signing ceremony for H.J. Res. 41 on Tuesday, February 14,

2017. Had I been present for roll call vote number 88, ordering the previous question of H. Res. 99, I would have voted yea. Had I been present for roll call vote number 89, Adoption of H. Res. 99, the combined rule providing for consideration of H.R. 428--Red River Gradient Boundary Survey Act and of H.J. Res. 42--Disapproving the rule submitted by the Department of Labor relating to drug testing of unemployment compensation applicants, I would have voted yea. Had I been present for roll call vote number 90, ordering the Previous Question on H. Res. 116--I would have voted yea. Had I been present for roll call vote number 91, Adoption of H. Res. 116--The combined rule providing for consideration of H.J. Res. 66--Disapproving the rule submitted by the Department of Labor relating to savings arrangements established by States for non-governmental employees and of H.J. Res. 67--Disapproving the rule submitted by the Department of Labor relating to savings arrangements established by qualified State political subdivisions for non-governmental employees, I would have voted yea.

Mr. Speaker, section 1504 of the Dodd-Frank Act was like

many other provisions that were ultimately included in the sprawling law. They had absolutely no relationship to the underlying cause of the financial and housing crisis.

However, some have used the financial crisis to hijack Federal securities law in order to push a socially motivated agenda. Specifically, section 1504 of the Dodd-Frank Act requires companies registered with the Securities and Exchange Commission to annually report payments such as taxes, royalties, fees, production entitlements, and those types of things made to a foreign or the U.S. Federal government relating to the commercial development of minerals, oils, and natural gas.

Companies subject to section 1504 must report the type and total amounts of these payments made for each project, as well as the type and total amounts of payments made to each government. These payments cover, as I said, taxes and other things that are really business expenses.

While this may be a laudable goal, using Federal securities law and the SEC to enforce social issues is inconsistent with the SEC's core mission and completely inappropriate. Just to remind everyone, the SEC's mission by law is to: One, protect investors; two, maintain fair, orderly, and efficient markets; and three, facilitate capital formation. I would liken what they are doing by having the SEC put this rule in place sort of like requiring your police department to be in charge of road repair, too. It is just not their expertise.

The SEC recognized this fact and stated that section 1504 ``appears designed primarily to advance U.S. foreign policy objectives,'' not investor protection or capital formation. Notwithstanding the merits of the underlying policy goals, conducting American foreign policy is not what Congress created the SEC to do. In fact, just moments ago, the U.S. Senate confirmed Rex Tillerson as the Secretary of State, and I would suggest that we let him direct our foreign policy. With all due respect to the commissioners and the SEC staff, none of them are really foreign policy experts.

As we debate this resolution, let's be clear on what this isn't about. Some have tried to argue that a vote to vacate this provision is a vote for corruption somehow. This couldn't be further from the truth. Now, I understand and sympathize with the sense and the feeling of this that this rule makes supporters feel better about themselves, but it does not solve the real world issues. This foreign rule that has been brought up is really like comparing apples and oranges with the foreign rules versus this particular rule. And if we allow them to rewrite this particular rule, we might actually mirror what the EU and what other foreign governments are doing.

Despite the claims to the contrary, H.J. Res. 41 does nothing to undermine the ability of the SEC and the Justice Department to police against foreign corruption. In fact, both of these agencies still have, at their disposal, Federal laws, including the Foreign Corrupt Practices Act, which prohibits bribing foreign officials.

And even without this SEC extraction rule in effect, fraud will still be fraud and corruption will still be corruption. Both will still be illegal activities that should be punished to the fullest extent of the law.

Voting for this resolution is a vote to right the ship. This is a vote to reset the regulatory process. Congress needs to send this flawed regulation back to the SEC drawing board and instruct the SEC to get the provision right by promulgating an appropriate rule under section 1504.

I urge my colleagues to support this resolution.

Will the gentleman yield?

Mr. Speaker, I will point out, though, what my resolution does, is it directs the SEC to go back to the drawing board. It is not our job to write the rule. You are asking for that proposal. The SEC wrote a rule; it got struck down by the courts. They got sued again.

Mr. Speaker, I would be happy to write a rule. I am not sure that the gentleman from Massachusetts would be happy with it. I am not sure that the SEC would be happy with it.

Again, having that debate here in the well of the House, I was not here for the writing of Dodd-Frank. I am dealing with the echo effects of it, and that is what we are trying to do right now. So rather than us having that, I put it back to the SEC.

Mr. Speaker, I rise today regarding missed votes on Monday, January 30, 2017. Had I been present for roll call vote number 66, H.R. 374, To remove the sunset provision of section 203 of Public Law 105-384, and for other purposes, I would have voted ``yea.'' Had I been present for roll call vote number 67, H.R. 538, the Ocmulgee Mounds National Historical Park Boundary Revision Act of 2017, I would have voted ``yea.''

Mr. Speaker, I rise today and thank the gentleman from New Jersey because nobody has fought longer or harder for the cause of life than this man. I am pleased to be up here because I know we both believe that we represent and rise on behalf of the hundreds of thousands of Americans who are going to come to Washington, D.C., and march here this coming Friday because we believe that giving even one more life, one more person, the right to change the world is worth it.

For the last 6 years, I have come to the well of the House with the gentleman from New Jersey and my colleagues on the bipartisan Pro-Life Caucus to celebrate life and fight for the unborn. On this seventh occasion, I rise with a renewed sense of hope and optimism for our children's future.

I commend President Trump for making one of his very first actions protecting unborn children around the world by preventing U.S. taxpayer dollars being used for foreign aid from being used to fund groups that promote abortion under the guise of family planning.

We can't stop here, however. That is just one step. Now is the time for action. When President Bush restored these protections in 2001, he wrote:

``It is my conviction that taxpayer funds should not be used to pay for abortions or advocate or actively promote abortion, either here or abroad.''

We took step two earlier today when a bipartisan majority of us here in the House voted to extend the Hyde amendment across all government programs and to ensure that no tax dollars from hardworking Americans are used to fund abortions here in the United States.

Let's take additional steps to fight for the ones who don't have a voice. This Congress should protect unborn children from the violence of late-term abortion, protect medical professionals from being coerced to participate in abortions, and protect women from an industry that has put its financial interests first above women's health.

Mr. Speaker, the government does not give us our rights. No. In fact, the government exists to protect our God-given rights that were given to us by our Creator and to protect the next generation. All you have to do is look at those original founding documents and it is easy to see.

Well, we are here tonight for the same reason: that hundreds of thousands will march on Washington this Friday and fight for the rights of that next generation. I am pleased and proud to be able to be a part of that.

Mr. Chair, I rise today in support of H.R. 78, the SEC Regulatory Accountability Act, which would improve and strengthen the SEC's rulemaking process by requiring more rigorous economic analysis.

What exactly does that mean?

Well, an economic analysis is quite simple, frankly. It is a systemic approach to determine the optimum use of scarce resources involving comparison of two or more alternatives to achieve a specific objective under the given assumptions and constraints. That is a whole lot of words and jumbo. But what we need to do is make a comparison, what is going to be the benefit.

Economic analysis takes into account the opportunity costs of resources employed and attempts to measure, in monetary terms, the private and social costs and benefits of a project to a community, an economy, or to an individual.

In its simplest terms, the SEC would have to determine the costs and benefits of proposed regulations, as well as potential alternatives to determine a best direction forward, basically ensuring that the SEC is thoroughly assessing both the need for the regulation and adequately evaluating the potential consequences, both intended and unintended, and is there a benefit.

Mr. Chairman, requiring economic analysis by Federal regulators is not a partisan issue. In fact, both President Clinton and President Obama issued executive orders requiring regulators to ensure that their rules were maximizing and achieving a net benefit.

H.R. 78, the SEC Regulatory Accountability Act, would ensure consistent and effective application of the SEC's economic analysis guidance by building on the bipartisan effort to strengthen economic analysis requirements, as well as require a retrospective review of existing regulations for independent agencies like the SEC.

Specifically, the bill would enhance the SEC's existing economic analysis requirements by requiring the Commission to first clearly identify the nature of the problem that would be addressed before issuing a new regulation--too often, we are just shooting at a target that we don't even know is actually a target--and to prohibit the SEC from issuing a rule when it cannot make ``a reasoned determination that the benefits of the intended regulation justify the costs of the regulation.''

Additionally, H.R. 78 would require the SEC to assess the costs and the benefits of available regulatory alternatives, including the alternative of not issuing a regulation, and choose the approach that would maximize the net benefit. The SEC must also evaluate whether a proposed regulation is inconsistent or incompatible or duplicative of other Federal regulations.

In testimony before the Subcommittee on Capital Markets and Government Sponsored Enterprises last year, former SEC Commissioner Dan Gallagher noted that the SEC Regulatory Accountability Act would ``promote and improve economic analysis at the SEC and make the agency even more accountable to the investing public.'' He further testified that this bill ``will help ensure the economic analysis conducted by economists is firmly entrenched in every rulemaking the SEC conducts under the Federal securities laws.''

Mr. Chair, I commend the gentlewoman from Missouri (Mrs. Wagner) for introducing this important piece of legislation, which will equip the SEC with the necessary tools to ensure that all future SEC regulations will meet these standards with the ultimate goal of achieving the SEC's statutory mission of protecting investors and facilitating capital formation.

I urge my colleagues on both sides of the aisle to support this important bill.

Mr. Chairman, despite the personal attacks happening on the floor here, I am glad to see that we are making real progress. Apparently, we are making an impact here.

With that, I yield 1\1/2\ minutes to the gentleman from New York (Mr. King).

Mr. Chairman, I yield 2 minutes to the gentleman from Arkansas (Mr. Hill), the whip of our Financial Services Committee.

I yield the gentleman an additional 30 seconds.

Mr. Chairman, at this time I yield 3 minutes to the gentleman from Illinois (Mr. Hultgren), the vice chairman of the Capital Markets Subcommittee.

Mr. Chairman, may I inquire as to what is the balance of the time remaining on each side?

Mr. Chairman, I yield 2 minutes to the gentleman from Florida (Mr. Ross).

Mr. Chairman, I yield 1\1/2\ minutes to the gentleman from California (Mr. Royce), the chairman of the House Foreign Affairs Committee.

I yield the gentleman an additional 15 seconds.

Mr. Chairman, may I inquire as to the balance of the time remaining?

Mr. Chairman, at this time, I do not intend to yield to the gentlewoman from New York, even though I struggle to understand how the Export-Import Bank had anything to do with what we are talking about here today.

Mr. Chairman, I yield 2 minutes to the gentleman from Colorado (Mr. Tipton), a member of the Financial Services Committee.

Mr. Chairman, I yield 2 minutes to the gentleman from Georgia (Mr. Loudermilk).

Mr. Chairman, I yield 1\1/2\ minutes to the gentleman from North Carolina (Mr. Budd), a new member of the Financial Services Committee.

Mr. Chairman, I yield myself the balance of my time.

I would just like to point out to those watching on TV the earlier Democrat-sponsored hot air portion of the bill today.

You heard about the Export-Import Bank. You heard about Bernie Madoff. You heard about the Dodd-Frank Act being the only answer to an economic crisis that was caused by a housing crisis which, by the way, the Dodd-Frank Act did nothing about. By the way, on the Bernie Madoff situation, the SEC ignored a whistleblower for 10 years.

This bill has nothing to do with fraud, and it is not about a trial of the effectiveness or lack thereof of the SEC today. This is about a commonsense notion that we ought to actually identify the target that these rules are trying to hit and then find out if it is the right target and analyze that.

What you see on the other side of the aisle is the philosophy that more is better: the more regulation that the SEC has, the more paperwork, a bigger budget with more employees. We are not sure what their effectiveness is, and we are not sure what exactly they are trying to achieve here, but all we can tell you is that more is better. Damn the costs; it doesn't matter.

That is, obviously, not the intent that we have on this side of the aisle. We are trying to make sure that the

proper protection of the investors is there. We are trying to make sure that the three parts of the SEC's mandate, of which one of those is capital formation and creating a robust atmosphere, are actually happening.

I urge passage of the bill.

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

Mr. Chairman, I claim the time in opposition to this amendment.

Mr. Chairman, I feel compelled to point out to my colleagues that we are not paid by the word that is put into the Federal Register. I think, once again, you are hearing this example of more is better. It doesn't matter what the words say, just let's have more of them.

We already have the SEC Chairman and the Commissioners covered by both governmentwide ethics laws and regulations as well as SEC supplemental ethics regulations which apply to all SEC employees. For example, they cannot participate personally and substantially in any matter that would have direct or predictable effect on his or her financial interests or imputed financial interests in the future, as required under the code.

Also, unless they are specifically authorized by the SEC's ethics counsel, they should recuse from any matter in which he or she has a ``covered relationship.'' Well, what is a covered relationship? Well, a covered relationship includes former employees, clients, and even a spouse's employer. Further, the SEC employees must report their financial holdings to the SEC's ethics counsel; and this requirement goes beyond, frankly, the governmentwide reporting requirement.

Finally, the SEC Chairman or a Commissioner must not engage in any other business, employment, or vocation while in office; nor may he or she ever use the power of their office to influence their name to promote the business interests of others, as required by law.

As such, I ask my colleagues to join me in opposing this amendment.

Mr. Chairman, I reserve the balance of my time.

Mr. Chairman, I will wrap up here by simply saying that the bill before us today is intending to clarify--or have the SEC, I should say, clarify what the goal and objective is of their proposed rule. Let's find out what they are trying to do, and then, more importantly, find out if it is actually effective.

There might be a rule in place already somewhere else. The other side is trying to strike that provision. They are trying to say: No. No. It doesn't matter what the other hand of government is saying. We are going to just add more and more regulation added on.

We need to have a clear understanding of what the objective is, what the target is, and whether it is an effective rule to get to that point. I just would encourage my colleagues to oppose the Waters-Green amendment.

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

Mr. Chairman, I ask unanimous consent to claim the time in opposition to this amendment, though I am not opposed.

Mr. Chairman, I am prepared to accept the amendment and support its immediate passage. I want to thank the sponsor for working with us to draft the language that is consistent with the SEC's tripartite mission to: number one, protect investors; number two, maintain fair, orderly, and efficient markets; and, number three, facilitate capital formation.

I would like to ask my colleagues to join me in supporting the amendment and the underlying bill.

Mr. Chairman, I reserve the balance of my time.

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

Mr. Chairman, I claim the time in opposition to this amendment.

Mr. Chairman, I just find it a bit ironic that the other side is not interested in doing this cost-benefit analysis which is in the underlying bill here because it is too burdensome. But what do they want to do? They want to add more paperwork and more burden in their amendments.

Despite what you have heard, the SEC is not a systemic risk regulator; and even the former chairman of the Committee on Financial Services, Barney Frank, noted at the time when the FSOC was reviewing asset managers for systemic designations, he recognized that these are not entities that pose a systemic risk to the financial system. And while the SEC does not regulate systemic risk, I am afraid that this amendment could be potentially politically misinterpreted and applied to a number of capital market participants and activities which they, frankly, have no business regulating. So it would lead to the same fire, aim, ready kind of situation rulemaking that we have seen from the current administration that hinders growth and that capital market formation that we have just talked about in the last amendment.

The bill before us will ensure that future SEC rulemakings are prudently proposed and adopted to achieve the maximum net benefit, and that is what we are really talking about here today. While I support the underlying bill, I will have to oppose this amendment.

Mr. Chairman, I reserve the balance of my time.

Will the gentleman yield?

This has nothing to do with Bernie Madoff since the whistleblower approached the SEC and the SEC, using its dollars, was not able to stop him.

I appreciate the gentleman yielding. Working together on the Financial Services Committee, we know that there are actuarial tables and analyze risk all the time. You are able to analyze fraud.

You are able to analyze that risk.

Mr. Chairman, may I inquire as to the remaining balance of the time.

At this point I am ready to close and I reserve the balance of my time.

Mr. Chairman, I would just like to point out to all of my colleagues and to the American people that currently the SEC is under a court order to clarify how exactly they are doing their rulemaking. And there is a staff-level rule letter.

With this underlying bill, we are trying to codify that. We are trying to make sure, not just with a letter, but by law, that they do what they are being ordered to do. And I will remind all of my colleagues and those of you out watching us, the Securities and Exchange Commission has a mission that has three parts.

The first part is to protect investors. Nothing in this bill weakens there. Nothing in this bill takes anything away from that. We, in fact, underscore that.

The second mission that it has is to maintain fair, orderly, and efficient markets. Emphasis again, fair, orderly, and efficient markets. What we are seeing is inefficiency that is being built into the marketplace right now, and we are here to clarify that. Let's find out, as the SEC is preparing a rule, what the goal and objective is and what is going to be the impact on it. Yes, cost is part of that, and we are able to look at that.

The third thing the SEC intended to do is to facilitate capital formation.

Why is that important and what exactly does that mean?

It means making sure that there is enough money around so that companies, big, medium, and small, are able to go in there and get the cash and the credit that they need to go and expand and do the job that they are trying to do, which is, by the way, employ all of us in America.

We have talked a lot about the underlying bill and not so much about the particular amendment that we have before us, but I do continue to oppose the amendment and encourage the passage of the underlying bill.

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

Mr. Chairman, I rise in opposition to this amendment.

Mr. Chairman, again, I think we are stumbling over the fact that my colleagues on the other side of the aisle believe that we are somehow paid by the words put into the Federal Registry here.

The SEC is already covered by both governmentwide ethics laws and regulations as well as SEC supplemental ethics regulations which apply to all SEC employees, including the Chair.

Perhaps the sponsor of the amendment is not aware that under existing Federal law, the SEC Chairman cannot participate personally in any matter that would have a direct and predictable effect on her financial interests or imputed financial interest, and I would invite the sponsor to review the code at this point.

Additionally, SEC supplemental regulations prohibit SEC employees, including the Chair, from holding any security in a directly regulated entity, and they must also preclear all purchases and sales of securities.

Further, the Chairman or Commissioner must not engage in any other business, employment, or vocation while in office, nor may she ever use the power of her office or the influence of her name to promote the business interests of others.

Finally, the amendment does not seem to address what I believe Congressman DeSaulnier's description is intending to address as it is the Federal Reserve, not the Securities and Exchange Commission, that regulates the too-big-to-fail banks or, as the amendment states, financial institutions.

The SEC does not regulate financial institutions. The code defines the term ``financial institution,'' and the definition includes ``a bank, a foreign bank, and a savings association.''

Since the SEC does not regulate any of these entities, the amendment would require the SEC Chair to divest of exactly zero entities. So notwithstanding that important discrepancy here, I ask my colleagues to join me in opposing the amendment.

Mr. Chairman, I reserve the balance of my time.

Mr. Chairman, at this time I am prepared to close, and I reserve the balance of my time.

Mr. Chairman, I would just point out again that this

amendment does not hit the target. The SEC does not regulate financial institutions. 15 U.S.C. 78c defines the term ``financial institutions,'' and that definition includes a bank, a foreign bank, and a savings association. The SEC does not regulate any of the entities that are described in this.

In addition to that, the Securities and Exchange Commission's Chair-- Chairwoman in this instance, who will be resigning soon--is covered under governmentwide ethics rules and laws. The SEC has additional SEC- specific rules that are in place. This amendment would do absolutely nothing to support or diminish those because it doesn't actually address any situation that they have.

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

Mr. Chairman, I rise in opposition to this amendment.

Mr. Chairman, I believe the sponsor of the amendment was in the Chamber when we were discussing this on the last amendment. Federal law, as well as SEC supplemental regulations, already govern ethics and conflicts of interest.

It is well-known, especially if you check out my Twitter account, I think, that most people who support this President don't believe I support this President enough. A number of people would say that I haven't supported the SEC Chairman to the level that I should. This, frankly, is insulting to the current President as well as the Chair. Implying somehow that this Chair has preyed off of poor people until they went bankrupt, as was just sort of laid out by the sponsor of this, is an insult.

To believe this of the SEC Chair, who is typically--and I know in this particular case is--a very accomplished professional, is amazingly shortsighted, I believe. Additionally, the Chair is required to receive personal annual ethics training as well as an initial ethics briefing. I direct the sponsor to review the statute on this.

Additionally, the Chairman and the Commissioners are required to file an ethics agreement letter in which she will agree to divest prohibited assets, and if she has not done so prior to the appointment, she is to recuse herself from matters in which she has financial conflict or the impartiality conflict, which can be found also in code.

Finally, the Chairman or a Commissioner is prohibited from engaging in any other business, employment, or vocation while in office, or she may never use the power of her office or her name to promote or influence a business interest.

Once again, I think that what we are trying to do here with the underlying bill is to make sure that the SEC follows through on what the courts have mandated in previous rulings in that they use a cost- benefit analysis. This is not about fraud. This is not about whether Mary Jo White needs ethics training. This is about making sure that the SEC has an identifiable target and goal with the rules that it is putting in place and then analyzing whether the costs and the benefits weigh in favor of protecting the consumer. Ultimately, this amendment does nothing to forward that. I oppose the amendment.

I reserve the balance of my time.

Mr. Chairman, I understand that the sponsor is a constitutional law professor.

I direct the gentleman to 5 CFR 2638.305 and 5 CFR 2638.304, which read:

The Chair of the SEC is required to receive in person

annual ethics training as well as an initial ethics briefing.

Additionally, Chairmen and Commissioners are required to file

ethics agreement letters in which they agree to divest.

The bottom line is that we don't need additional words in the Federal Register to do what is already being done.

The sponsor of the amendment mentioned that cost-benefit analysis is not in the U.S. Constitution, but neither is the SEC. However, due process is in the Constitution, and what we are trying to get at is due process to make sure that we have--us, as a legislative body--properly involved and engaged in this and that we understand what the goals and objectives of the Securities and Exchange Commission are when it is issuing a rule and whether that rule is going to effect the change intended.

What are those benefits? Is it going to benefit and protect the consumer?

Again, I reiterate the three elements of the mission of the Securities and Exchange Commission: number one, to protect investors; number two, to maintain fair and orderly and efficient markets; and number three, to facilitate capital formation. Those are the stated goals and is the job of the Securities and Exchange Commission.

I reserve the balance of my time.

Mr. Chairman, I maintain my opposition to this amendment.

I yield back the balance of my time.

Mr. Speaker, I claim the time in opposition.

Mr. Speaker, I have to commend my colleague. This is close, but this isn't horseshoes. Words have meaning. And I have to tell you that our underlying bill does actually do what you are talking about.

I will direct you to page 4.

Page 4: ``evaluate whether, consistent with obtaining regulatory objectives, the regulation is tailored to impose the least burden on society, including market participants, individuals, businesses of different sizes, and other entities, including State and local government entities, taking into account, to the extent practicable, the cumulative costs of regulations.''

So, what we have here, Mr. Speaker, is a problem. We have a problem with U.S. businesses not performing the way that they should. We have to understand, though, why that is happening.

I have to point out to my colleague that, frankly, we have fewer publicly traded companies in this country right now. You have to ask yourself why.

We have virtually no IPOs happening in this country. You have to ask yourself why.

Well, we know the answer. It is because we have overly burdened ourselves in this country and are no longer competitive.

In fact, here is what I look forward to on January 21: I look forward to repealing the Tax Code that we have, and then we don't have to worry; I am looking forward to repealing ObamaCare, and then we don't have to worry; I am looking forward to real regulatory reform, and then we don't have to worry about that as a country.

So, while this may be close on the objective of what our sponsor is trying to do, I would recommend voting against this motion to recommit and vote for the underlying bill.

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

Mr. Speaker, I rise to support my friend Betsy DeVos, President-elect Trump's nominee to serve as the next Secretary for the Department of Education.

Betsy is a passionate and dedicated servant with a big heart for kids. She is a grandmother of five who has made it her life's mission to ensure that all children in America have access to a quality education no matter what their ZIP Codes are. Betsy has fought for children in classrooms to State capitals, and her efforts have given more kids hope for a brighter future. In our shared home State of Michigan, Betsy led the effort to pass the State's first charter school law. According to Stanford University, Michigan's charter school students now perform at a higher level than do their peers.

I witnessed Betsy's creativity and discipline firsthand when we served together on the board of the Compass College of Cinematic Arts, a Grand Rapids, Michigan-based film school and production company. We implemented rigorous standards that set Compass up for accreditation, and it now holds them accountable.

I know that Betsy is up to the challenge of ensuring our children are prepared to compete and thrive in our ever-changing world.

I thank the chairman for his leadership.

Mr. Chairman, we all know that small businesses and entrepreneurs are what drive the American economy. We meet them in our districts and we see firsthand the benefits that their dreams and hard work provide to our constituents and to our communities.

These innovators, entrepreneurs, and risk-takers are really small- business people who are critical for our country's economic prosperity. Small businesses helped to create more than 60 percent of the Nation's net new jobs over the past two decades. So if our Nation is going to have an economy that provides opportunities for every American, then we must promote and encourage the success and growth of our small businesses and our startups.

In order to succeed, these companies need capital and credit--the lifeblood for growth, expansion, and job creation. Yet, the government continues

to construct arbitrary walls that cut them off from essential financing as smaller companies are caught up in red tape that was created, frankly, for the largest public companies, but those public companies have the financial means to hire lawyers and accountants and management consultants and all of those things that would then guide them through the sheer weight, volume, and complexity of the Federal securities laws.

Congress has made strides in tailoring the regulatory environment for smaller companies, most notably when we passed with strong bipartisan support the Jumpstart Our Business Startups, or JOBS Act, in 2012. The JOBS Act's benefits are notable as more and more companies use its provisions to raise investment capital in both the public and private markets.

One essential form of capital for many startups comes from angel investors--sophisticated, high net-worth individuals who invest their own money into startups and other early stage companies. Not many college students of whom I am aware would fit that definition of a sophisticated, high net-worth individual. In 2015, angel investors deployed over $24 billion to about 71,000 startups--many of these investments going to companies in their own communities and States. Beyond capital, angels provide advice and guidance to help these companies succeed and create jobs.

Mr. Chairman, I believe that it is important to note that companies such as Amazon, Costco, Facebook, Google, and Starbucks, among a myriad of others that we have not necessarily heard of as public names, were all initially funded by angel investors. Without angel investors, these very successful companies would have never gotten off the ground.

Yet, the Securities and Exchange Commission, whose neglect of its statutory mission to facilitate capital formation necessitated that Congress pass the JOBS Act in the first place, has further restricted startups from interacting with angel investors at demo days and similar pitch events. Startups rely on demo days and similar events to build relationships with angels and other investors and generate interest in their companies and their ideas. These events existed prior to the JOBS Act, but the SEC's rules jeopardize their future.

H.R. 79, the Helping Angels Lead Our Startups, or HALOS Act, is a commonsense, bipartisan bill that is aimed at removing a significant regulatory hurdle for innovative companies and startups that seek early stage equity investments. Specifically, the HALOS Act would clarify that these demo days, which are sponsored by angel investor groups, universities, municipalities, and nonprofits, are not considered to be general solicitations and would, instead, ensure that angel funding remains available to those businesses that seek investment capital. These are really educational opportunities.

Mr. Speaker, some of our colleagues on the other side of the aisle will claim that the HALOS Act guts critical investor protections and will subject honest, hardworking Americans to rampant fraud. We just had an example of college students being brought up. That is simply not true.

A company that offers securities to investors under these rules may only sell their securities to sophisticated or accredited investors. If these individuals do not meet the standards of an accredited investor, they are not then eligible or even allowed to invest in these types of startups that would participate in a demo day.

Instead, the HALOS Act is a simple, bipartisan, bicameral, and, I might add, short bill that will provide small innovative companies and startups the ability to interact with angels and other investors who can provide the capital that they need to succeed, grow, and create jobs.

Indeed, Senator Chris Murphy of Connecticut said it best when he introduced the HALOS Act last Congress: ``I have heard from local entrepreneurs and interested backers alike that the most important thing we can do to help these businesses is to make it easier for angel investors to put capital behind them--and that is exactly what our bipartisan HALOS Act will do.''

Mr. Chair, that was Senator Chris Murphy of Connecticut.

I commend the efforts of Representatives Chabot and Sinema for working together across the aisle on a bipartisan, positive solution.

Last Congress, the HALOS Act passed this very body with an overwhelming bipartisan vote of 325-89. I have high hopes that H.R. 79 will enjoy another strong, bipartisan vote.

I encourage all my colleagues to support its adoption.

Mr. Chairman, I yield 3 minutes to the gentleman from Illinois (Mr. Hultgren).

Mr. Chair, I yield 2 minutes to the gentleman from Texas (Mr. Williams).

Mr. Chairman, I yield 2 minutes to the gentleman from Tennessee (Mr. Kustoff), a new member of the House Financial Services Committee.

Mr. Chair, I yield 2 minutes to the gentleman from Illinois (Mr. Schneider) for 2 minutes.

Mr. Chairman, may I inquire as to the balance of time remaining on both sides.

Mr. Chair, I yield 2 minutes to the gentlewoman from Arizona (Ms. Sinema), the coauthor of this bill.

Mr. Chairman, I yield 2 minutes to the gentlewoman from Florida (Mrs. Murphy) and welcome her as a new Member.

Mr. Chairman, I yield myself the balance of my time.

I have actually had the pleasure and the honor of sitting through a number of these demo days and seeing these pitches being made. People are coming in, and they are literally laying out their dreams, their hopes, and, frankly, their hard work because they wouldn't be there that day if it wasn't for their hard work. They are looking for a couple of things. As small businesses and entrepreneurs, they are looking for capital and credit. We use the word ``capital'' a lot around here, but think of it as cash and credit. They really are looking for someone who will buy into their dream, who will look at their hard work, and who will understand that their dreams can become a reality with hope. This bill is trying to do that.

Members are hearing a lot of doom and gloom on the other side. In fact, I think the phrase was just thrown out, financial doom for the retail investor. Let's talk about these retail investors.

For you to become an accredited investor, someone who would qualify to be able to invest in these startup companies, according to SEC rule 501, you need to be married, jointly; $300,000 in income; and $1 million of net worth, excluding your home. So you cannot include a million-dollar home. You have to have $1 million net worth outside of your home and have an income of $300,000. Earlier, college students were brought up. Not a whole lot of college students that I am aware of have $300,000 annual income or $1 million net worth.

These are people who are sophisticated, typically. They are high net worth, by definition. Interestingly enough, as Members of Congress, if we allowed some of these amendments to go through and these restrictions to go through, as Members of Congress, we would be excluded from the room. We would be excluded. We couldn't even go in there to educate ourselves about how this process works. That, ultimately, is what this is about.

Those pitch days are not just for those people who are going to invest. Those pitch days are not just for the people who are going to do the investing. Those pitch days are for others to learn, to have an understanding.

If you are a college student sitting in the back row, to understand what it looks like to become an entrepreneur, to really become a part of that engine of the American economy, you should be in the room. If you are someone who might be making a pitch later on and want to see how this happens and

works, you ought to be in the room. Let's not exclude those people.

Why would we have a government closed off, closed room, a government- sanctioned closed room that would keep people from understanding and achieving their hopes and dreams and success?

I am pleased to be up here and to talk about this issue because we know that for our standing in the world, we need to have a dynamic economy. Our dynamic economy starts with our entrepreneurs and the risk-takers who are willing to invest in those ideas.

I just want to commend the gentlewoman from Arizona (Ms. Sinema) and the gentleman from Ohio (Mr. Chabot) for working in a bipartisan manner. I expect we are going to see a massively bipartisan vote for this bill, and I eagerly await that. I ask my colleagues to support

Mr. Chairman, I claim the time in opposition to this amendment.

Mr. Chairman, so here is the alternate reality you are expected to believe in this scenario that has been created. You are going to have somebody wander off the street with their checkbook in their pocket, listen to a 3- to 5-minute pitch on an idea that is going to change the world, and then they are going to sign away their financial future and life savings. That is the scenario that is being painted for you out there today by the opponents of this commonsense legislation.

Again, to be an investor, you must be an accredited investor, according to the SEC rules, Rule 501, that says you have $300,000 of income annually and a net worth of $1 million outside of your home. Owning your house doesn't count towards that.

I have been to these pitch days. You know what you are walking into. You don't just stumble on it and go: Wow, what's going on here?

I have never thought about this. Tell you what, I am going to write a five- or six- or seven-figure check today and put myself into financial ruin. That is not how these things work.

Mr. Chairman, at the end of the day, I think it is important to just review a little bit of the history here.

First of all, this amendment isn't necessary. It would create yet another SEC-required disclosure and further burden the ability for startups to present their ideas to demo days.

I would note that this amendment could have been offered last March, either in committee or while we here in the House had consideration last April 2016. However, in both cases that didn't occur.

Let's remember why we are here today, Mr. Chairman. When the SEC promulgated the rules to implement Title II of the JOBS Act, the agency made something that was legal prior to April 5 of 2012 suddenly illegal. The SEC decided that demo days that bring together those entrepreneurs and those companies suddenly became a general solicitation.

That isn't the case, and this amendment would require the SEC to prescribe a disclosure that ``describes the nature of the event and the risks of investing in securities being advertised.''

There is no sale that day, Mr. Chairman. No sale at all is going to happen. There is no exchange that happens at that event.

This amendment is unnecessary, overly broad, and would delay the return to the certainty that the pre-JOBS Act had brought.

Mr. Chairman, I reserve the balance of my time.

Mr. Chairman, I have no further speakers on this amendment.

Mr. Chairman, you just heard the author of the amendment make the case that this is a complicated process in general that an unaccredited person is not going to be allowed to invest in. So it requires the event sponsor to provide attendees with a written disclosure outlining the nature of the event and the risks of investing in the securities for sale. It is not an offering that is happening at those demo days. I would ask my colleagues to oppose this amendment.

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

Mr. Chairman, I claim the time in opposition to this amendment.

Mr. Chairman, once again, we are seeing an unnecessary, duplicative amendment here. The amendment, as it is laid out, creates a new definition of an issuer. The Securities Exchange Act already defines an issuer, and Ms. Waters' definition is vague, confusing and, frankly, unnecessary.

Demo days are opportunities for startup companies to present their ideas to potential investors that are accredited. Again, accredited. At this point, all of America is shouting back at C-SPAN, saying, $300,000 in income

per year with $1 million net worth, excluding their home. We get this out there. This is not a solicitation or offering a security.

So what I am, quite honestly, concerned about and maybe a little confused about is the point of the HALOS Act trying to fix a problem. It is trying to fix a problem.

Remember, we want to expose entrepreneurs and their ideas to the broadest pool of potential investors that includes angel investment community, again, of accredited investors. This requirement raises serious compliance concerns for angel investors. It would require entrepreneurs and startups to perform a compliance function that they may not have the physical or financial means to do so. Again, it is just an additional burden and barrier to entry for entrepreneurs.

Again, these are--the entrepreneurs typically aren't the ones that have $300,000 of annual income or $1 million net worth because, frankly, then they wouldn't have to be at the pitch. They could fund it themselves.

The idea is to make sure that those ideas, those people who are looking for an opportunity are given the broadest opportunity possible. And I think what we are seeing here is a reaction to the notion that, you know what? Maybe people can handle this on their own instead of the government needing to step in and be so overly prescriptive and control every decision that they are making.

You are seeing a reaction on the other side to that, to that notion of freedom, that idea of an entrepreneurial spirit; this idea that we all need to be wrapped in bubble wrap as we go out into the world. That is not government's role or job.

Outside of those prescriptions that are already in place, again, we are talking about a narrow group of investors with $300,000 of net income annually, and $1 million net worth who would even qualify to invest in those.

Why we would wall this off from others seeking to learn and to see an opportunity, I just simply don't understand.

Mr. Chairman, I reserve the balance of my time.

Mr. Chairman, in closing, I cannot support an amendment that makes it more difficult for startups to receive the crucial funding that they need to grow and create new jobs. Again, these are people pursuing their dreams, their hopes. They need capital and credit. They need cash and credit to go fulfill those.

Mr. Chairman, I actually believe in the SEC. I believe that the rules that they operate under are sufficient. I believe in the JOBS Act. I believe in the HALO Act that will provide the proper protections to investors, again, qualified investors with a $300,000 income and a $1 million net worth.

There are proper protections in place. This amendment does nothing but add additional burden to those seeking the investment and those seeking to invest. I request opposition from my colleagues.

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

Mr. Chairman, I move that the Committee do now rise.