Bill Overview
Title: SBIC Advisory Committee Act of 2022
Description: 2 This bill requires the Small Business Administration (SBA) to establish an advisory committee to develop recommendations for expanding SBA assistance provided through Small Business Investment Companies (SBICs). SBICs are privately owned companies, licensed and regulated by the SBA, which invest in small businesses through debt and equity. Composed in part of representatives of and partners with small businesses in low-income communities and rural areas, the advisory committee must make recommendations for SBICs to invest in (1) underlicensed and underfinanced states; and (2) small businesses owned by socially or economically disadvantaged individuals, veterans, and women.
Sponsors: Sen. Cardin, Benjamin L. [D-MD]
Target Audience
Population: Small business owners globally, particularly in disadvantaged areas
Estimated Size: 12000000
- SBICs are focused on providing capital to small businesses through debt and equity.
- The bill explicitly mentions expanding assistance to small businesses, particularly those in disadvantaged areas and owned by disadvantaged groups.
- Small businesses constitute a large portion of the economy in most countries, especially in the United States.
- Globally, small enterprises are a significant source of employment.
- SBICs specifically target traditionally underserved markets and individuals, which are significant in number.
Reasoning
- Given the details of the policy, the primary beneficiaries are small business owners in low-income and rural communities, and those owned by women, minorities, veterans, and economically disadvantaged individuals. The small budget available initially, $3,000,000, will likely result in a low-medium impact per individual but could set the stage for high longer-term impact as recommendations unfold and receive more funding.
- It is important to consider a variety of individuals, from those who are not directly impacted but might be in the general business community, to targeted beneficiaries.
- The Cantril Self-Anchoring Scale, used here to measure wellbeing, is subjective and may vary based on individual perceptions of improvement or benefit from policies.
- The general population of small business owners consists of diverse socioeconomic backgrounds, making some more directly affected by the availability of new resources or opportunities than others.
- Impacts may not be immediate but could grow over time as businesses stabilize and expand, creating more jobs and opportunities in their communities.
Simulated Interviews
Owner of a food delivery service (Detroit, MI)
Age: 42 | Gender: female
Wellbeing Before Policy: 5
Duration of Impact: 10.0 years
Commonness: 12/20
Statement of Opinion:
- I believe this policy could really boost my business if it helps me gain access to new funding options. It's hard to grow without financial backing.
- I hope the advisory committee can really understand what small businesses in areas like mine go through.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 5 | 5 |
| Year 2 | 6 | 5 |
| Year 3 | 6 | 5 |
| Year 5 | 7 | 5 |
| Year 10 | 8 | 5 |
| Year 20 | 8 | 5 |
Tech startup founder (Boise, ID)
Age: 35 | Gender: male
Wellbeing Before Policy: 6
Duration of Impact: 10.0 years
Commonness: 8/20
Statement of Opinion:
- The policy seems promising for expanding tech innovation in rural areas like mine.
- As a veteran, having advisory backing to fund ventures can significantly improve our operational scope.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 6 | 6 |
| Year 2 | 6 | 6 |
| Year 3 | 7 | 6 |
| Year 5 | 7 | 6 |
| Year 10 | 8 | 6 |
| Year 20 | 8 | 6 |
Retail shop owner (San Francisco, CA)
Age: 63 | Gender: female
Wellbeing Before Policy: 7
Duration of Impact: 10.0 years
Commonness: 15/20
Statement of Opinion:
- This policy won't directly affect my business as I am not in the specific disadvantaged groups targeted.
- I'm hopeful indirect benefits might arise if underfunded areas see economic growth.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 7 | 7 |
| Year 2 | 7 | 7 |
| Year 3 | 7 | 7 |
| Year 5 | 7 | 7 |
| Year 10 | 7 | 7 |
| Year 20 | 7 | 7 |
Founder of a sustainable clothing line (Austin, TX)
Age: 28 | Gender: other
Wellbeing Before Policy: 4
Duration of Impact: 5.0 years
Commonness: 9/20
Statement of Opinion:
- I see great potential benefits in gaining more access to sustainable funding sources.
- However, I'm skeptical if the policy will effectively address specific needs of eco-friendly businesses like mine.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 4 | 4 |
| Year 2 | 5 | 4 |
| Year 3 | 6 | 5 |
| Year 5 | 6 | 5 |
| Year 10 | 6 | 5 |
| Year 20 | 6 | 5 |
Restaurant owner (Atlanta, GA)
Age: 45 | Gender: male
Wellbeing Before Policy: 6
Duration of Impact: 5.0 years
Commonness: 14/20
Statement of Opinion:
- I think expanding SBICs can generally help businesses that need a financial boost.
- While my restaurant isn't in a low-income area, any increase in diner income could help my sales.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 6 | 6 |
| Year 2 | 6 | 6 |
| Year 3 | 6 | 6 |
| Year 5 | 6 | 6 |
| Year 10 | 6 | 6 |
| Year 20 | 6 | 6 |
Owner of a minority women's cooperative (Buffalo, NY)
Age: 51 | Gender: female
Wellbeing Before Policy: 5
Duration of Impact: 15.0 years
Commonness: 10/20
Statement of Opinion:
- If the policy can mobilize funds towards our demographic, it could markedly uplift our operations.
- I am optimistic but cautious; the advisory should align closely with community needs.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 5 | 5 |
| Year 2 | 6 | 5 |
| Year 3 | 7 | 5 |
| Year 5 | 8 | 5 |
| Year 10 | 9 | 5 |
| Year 20 | 9 | 5 |
Agricultural business owner (Fresno, CA)
Age: 39 | Gender: male
Wellbeing Before Policy: 5
Duration of Impact: 3.0 years
Commonness: 13/20
Statement of Opinion:
- The advisory committee's recommendations may help address unique financial challenges in agriculture.
- A lack of direct focus on agriculture in the policy may limit potential impacts.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 5 | 5 |
| Year 2 | 5 | 5 |
| Year 3 | 5 | 5 |
| Year 5 | 5 | 5 |
| Year 10 | 5 | 5 |
| Year 20 | 5 | 5 |
Digital marketing platform entrepreneur (New Orleans, LA)
Age: 29 | Gender: female
Wellbeing Before Policy: 6
Duration of Impact: 7.0 years
Commonness: 11/20
Statement of Opinion:
- If the policy funnels resources to platforms like ours that support other startups, it could cause a ripple effect.
- I am eager for more granular recommendations from the advisory on technical industries.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 6 | 6 |
| Year 2 | 7 | 6 |
| Year 3 | 7 | 6 |
| Year 5 | 8 | 6 |
| Year 10 | 8 | 6 |
| Year 20 | 8 | 6 |
Tech incubator director (New York, NY)
Age: 58 | Gender: male
Wellbeing Before Policy: 7
Duration of Impact: 10.0 years
Commonness: 5/20
Statement of Opinion:
- I am hopeful that the policy prioritizes digital innovation funding, which is crucial for modern small businesses.
- The committees must act swiftly to circulate resources efficiently and adaptively.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 7 | 7 |
| Year 2 | 7 | 7 |
| Year 3 | 8 | 7 |
| Year 5 | 8 | 7 |
| Year 10 | 8 | 7 |
| Year 20 | 8 | 7 |
Craft brewery owner (Sioux Falls, SD)
Age: 33 | Gender: other
Wellbeing Before Policy: 5
Duration of Impact: 15.0 years
Commonness: 7/20
Statement of Opinion:
- As a niche market in a semi-rural area, access to new investment opportunities could really boost our growth.
- There needs to be a real commitment to minimizing bureaucratic lags.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 5 | 5 |
| Year 2 | 6 | 5 |
| Year 3 | 7 | 5 |
| Year 5 | 7 | 5 |
| Year 10 | 8 | 5 |
| Year 20 | 9 | 5 |
Cost Estimates
Year 1: $3000000 (Low: $2500000, High: $4000000)
Year 2: $3000000 (Low: $2500000, High: $4000000)
Year 3: $3100000 (Low: $2600000, High: $4100000)
Year 5: $3300000 (Low: $2700000, High: $4200000)
Year 10: $3500000 (Low: $2800000, High: $4500000)
Year 100: $4000000 (Low: $3000000, High: $5000000)
Key Considerations
- The bill emphasizes aiding underrepresented and disadvantaged communities, which may require additional resources and legal considerations.
- The effectiveness of the advisory committee will depend on its ability to address the unique challenges faced by the target groups.
- The impact on small businesses and the wider economy will largely depend on the implementation of the recommendations made by the advisory committee.