Markup of H.R. 7352, H.R. 7334, H.R. 7622, H.R. 7664 — Hearing Before the Committee on Small Business
Summary
A markup before the Committee on Small Business, House of Representatives, on May 11, 2022, covering bills including H.R. 7352, the PPP and Bank Fraud Enforcement Harmonization Act of 2022, and H.R. 7334, the COVID-19 EIDL Fraud Statute of Limitations Act of 2022. The contents also list H.R. 7670, the Women-Owned Small Business Program Transparency Act, and H.R. 7694, the Strengthening Subcontracting for Small Businesses Act of 2022. Hon. Nydia M. Velázquez presided as chairwoman of the Committee, which met at 10:05 a.m. in Room 2360, Rayburn House Office Building. The contents list opening statements by Hon. Nydia Velázquez and Hon. Blaine Luetkemeyer.
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“Markup of H.R. 7352, H.R. 7334, H.R. 7622, H.R. 7664 — Hearing Before the Committee on Small Business.”
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MARKUP OF: H.R. 7352, H.R. 7334, H.R. 7622,
H.R. 7664, H.R. 7670, H.R. 5879, H.R. 7694
HEARING
BEFORE THE
COMMITTEE ON SMALL BUSINESS
UNITED STATES
HOUSE OF REPRESENTATIVES
ONE HUNDRED SEVENTEENTH CONGRESS
SECOND SESSION
HEARING HELD
MAY 11, 2022
Small Business Committee Document Number 117–054
Available via the GPO Website: www.govinfo.gov
U.S. GOVERNMENT PUBLISHING OFFICE
47–737 WASHINGTON : 2022
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HOUSE COMMITTEE ON SMALL BUSINESS
NYDIA VELÁZQUEZ, New York, Chairwoman
JARED GOLDEN, Maine
JASON CROW, Colorado
SHARICE DAVIDS, Kansas
KWEISI MFUME, Maryland
DEAN PHILLIPS, Minnesota
MARIE NEWMAN, Illinois
CAROLYN BOURDEAUX, Georgia
TROY CARTER, Louisiana
JUDY CHU, California
DWIGHT EVANS, Pennsylvania
ANTONIO DELGADO, New York
CHRISSY HOULAHAN, Pennsylvania
ANDY KIM, New Jersey
ANGIE CRAIG, Minnesota
BLAINE LUETKEMEYER, Missouri, Ranking Member
ROGER WILLIAMS, Texas
PETE STAUBER, Minnesota
DAN MEUSER, Pennsylvania
CLAUDIA TENNEY, New York
ANDREW GARBARINO, New York
YOUNG KIM, California
BETH VAN DUYNE, Texas
BYRON DONALDS, Florida
MARIA SALAZAR, Florida
SCOTT FITZGERALD, Wisconsin
MELISSA JUNG, Majority Staff Director
ELLEN HARRINGTON, Majority Deputy Staff Director
DAVID PLANNING, Staff Director
(II)
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CONTENTS
OPENING STATEMENTS
Page
Hon. Nydia Velázquez ............................................................................................. 1
Hon. Blaine Luetkemeyer ....................................................................................... 3
APPENDIX
Additional Material for the Record:
H.R. 7352, ‘‘PPP and Bank Fraud Enforcement Harmonization Act of
2022’’ .............................................................................................................. 23
H.R. 7334, ‘‘Covid-19 EIDL Fraud Statute of Limitations Act of 2022’’ ...... 25
H.R. 7622, ‘‘Small Business Workforce Pipeline Act of 2022’’ ...................... 28
H.R. 7664, ‘‘Supporting Small Business and Career and Technical Edu-
cation Act of 2022’’ ........................................................................................ 31
H.R. 7670, ‘‘Women-Owned Small Business Program Transparency Act’’ .. 34
H.R. 5879, ‘‘HubZone Price Evaluation Preference Clarification Act of
2021’’ .............................................................................................................. 38
H.R. 7694, ‘‘Strengthening Subcontracting for Small Businesses Act of
2022’’ .............................................................................................................. 40
(III)
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MARKUP OF: H.R. 7352, ‘‘PPP AND BANK
FRAUD ENFORCEMENT HARMONIZATION
ACT OF 2022’’ H.R. 7334, ‘‘COVID-19 EIDL
FRAUD STATUTE OF LIMITATIONS ACT OF
2022’’ H.R. 7622, ‘‘SMALL BUSINESS
WORKFORCE PIPELINE ACT OF 2022’’ H.R.
7664, ‘‘SUPPORTING SMALL BUSINESS AND
CAREER AND TECHNICAL EDUCATION ACT
OF 2022’’ H.R. 7670, ‘‘WOMEN-OWNED SMALL
BUSINESS PROGRAM TRANSPARENCY ACT’’
H.R. 5879, ‘‘HUBZONE PRICE EVALUATION
PREFERENCE CLARIFICATION ACT OF 2021’’
H.R. 7694, ‘‘STRENGTHENING SUBCON-
TRACTING FOR SMALL BUSINESSES ACT OF
2022’’
WEDNESDAY, MAY 11, 2022
HOUSE OF REPRESENTATIVES,
COMMITTEE ON SMALL BUSINESS,
Washington, DC.
The Committee met, pursuant to call, at 10:05 a.m., in Room
2360, Rayburn House Office Building, Hon. Nydia M. Velázquez
[chairwoman of the Committee] presiding.
Present: Representatives Velázquez, Davids, Golden, Crow,
Mfume, Phillips, Newman, Bourdeaux, Carter, Evans, Houlahan,
Craig, Luetkemeyer, Williams, Stauber, Meuser, Tenney,
Garbarino, Young Kim of California, Van Duyne, and Fitzgerald.
Chairwoman VELÁZQUEZ. Good morning. With a quorum being
present, I call this morning’s meeting of the Committee on Small
Business to order.
Without objection, the Chair is authorized to declare a recess at
any time.
I would like to begin by noting some important requirements. Let
me begin by saying that standing House and Committee rules and
practice will continue to during hybrid proceedings. All Members
are reminded that they are expected to adhere to these standing
rules.
House regulations require Members to be visible through a video
connection throughout the proceeding, so please keep your cameras
(1)
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on. Also, please remember to be muted until you are recognized to
minimize background noise.
Today, we will be considering seven bipartisan bills that are a
product of our legislative and oversight work over the course of this
Congress. It has been a difficult couple of years. The pandemic has
inflicted unprecedented harm on the small business community
throughout the country. This Committee and its Members have
worked diligently to provide both emergency and recovery support,
and we are beginning to see the fruits of our labor.
In 2021, Americans launched more than 5 million new busi-
nesses, higher than any previous year on record. Our economy has
added more than 7.4 million jobs and unemployment is down to 3.6
percent. Small businesses will continue to lead the way in our re-
covery, and it is important that our committee remain focused on
moving legislation to support small business growth for years to
come.
Just 2 weeks ago, we passed five bipartisan bills through the
House in anticipation of National Small Business Week, and now
we are back today to consider seven more bipartisan bills dedicated
to promoting policies that encourage economic prosperity on main
street in a variety of ways.
First, we have two bills setting the statute of limitations for
fraud in cases related to PPP and EIDL of 10 years. These bills will
give law enforcement more time to investigate and prosecute pan-
demic-related fraud. I am proud to have partnered with the Rank-
ing Member to take common sense steps to root out fraud and re-
cover billions of dollars.
Next, we will consider two bills to help small firms attract and
retain qualified workers. Our committee has held numerous hear-
ings over the past year and the bills represent what we have con-
sistently heard from witnesses, the importance of utilizing appren-
ticeships and career and technical education programs.
Finally, we will consider three contracting bills to improve the
federal procurement process and promote opportunities for small
businesses.
Each of these pieces of legislation are critical to making it easier
for employers to do what they do best, operate their business and
create jobs.
With that, let’s turn to the bills under consideration.
H.R. 7352, the ‘‘PPP and Bank Fraud Enforcement Harmoni-
zation Act of 2022,’’ introduced by myself and cosponsored by Rank-
ing Member Luetkemeyer.
H.R. 7334, the ‘‘COVID-19 EIDL Fraud Statute of Limitations
Act of 2022,’’ introduced by the Ranking Member and cosponsored
by myself.
H.R. 7622, the ‘‘Small Business Workforce Pipeline Act of 2022,’’
introduced by Mr. Crow and cosponsored by Mr. Fitzgerald, Ms.
Houlahan, and Mr. Garbarino.
H.R. 7664, the ‘‘Supporting Small Business and Career and Tech-
nical Education Act of 2022,’’ introduced by Mr. Williams and co-
sponsored by Ms. Newman.
H.R. 7670, the ‘‘Women-Owned Small Business Program Trans-
parency Act,’’ introduced by Ms. Houlahan and cosponsored by Ms.
Tenney.
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H.R. 5879, the ‘‘HUBZone Price Evaluation Preference Clarifica-
tion Act of 2021,’’ introduced by Ms. Newman and cosponsored by
Ms. Salazar.
And H.R. 7694, the ‘‘Strengthening Subcontracting for Small
Businesses Act of 2022,’’ introduced by Mr. Stauber and cospon-
sored by Mr. Mfume.
These bills have bipartisan support and I urge Members to sup-
port them.
I would now like to recognize the Ranking Member for his open-
ing statement.
Mr. LUETKEMEYER. Thank you, Madam Chair, and thank you
for calling this markup to discuss seven bipartisan bills that ad-
dress a few different needs of the nation’s job creators. Frankly
put, the nation’s small businesses, entrepreneurs, innovators, and
startups, are facing some of the strongest headwinds in decades.
Unfortunately, this morning’s Consumer Price Index report high-
lights more of the same, from price increases that impact every-
thing from food to gas, to not being able to find employees, to the
continued supply chain issues, it is difficult to be a small business
owner today. Inflation alone is a top challenge facing small busi-
nesses according to the surveys published by the Job Creators Net-
work.
Unfortunately, because small business owners operate on the
thinnest of margins, dealing with inflation often is limited and re-
sults in raising prices themselves. This is a continuous cycle that
puts the nation’s smallest firms at a disadvantage. We must stop
reckless spending in Washington and must stop it now.
Pro-growth initiatives have worked in the past and they will
work again. A low tax environment for small businesses, combined
with a smart regulatory environment will allow businesses to re-
turn to operating independently. I look forward to returning to an
economic environment that allows small businesses to grow, ex-
pand, and create jobs. Through this same lens, it is the responsi-
bility of this committee to examine issues through congressional
testimony and hearings and present prudent and responsible solu-
tions. Today’s slate of bills accomplishes this.
Before us today are bills that tackle fraud and the recoupment
of wasted dollars, bills that enforce workforce development of our
country, and bills to strengthen the SBA’s federal contracting pro-
grams. All three of these topics have been discussed widely by our
Members and it truly represents how we, as a committee, should
follow regular ardor.
I want to thank the Chair for bringing these bills forward and
they represent the work and devotion of many of our committee
Members. I support each and every one of these bills and rec-
ommend a yes vote across the board.
With that, Madam Chair, I look forward to today’s markup, and
I yield back.
Chairwoman VELÁZQUEZ. Thank you, Ranking Member. The
gentleman yields back.
Before we get into the individual bills, are there any Members
present who seek recognition for the purpose of making an opening
statement?
H.R. 7352
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Seeing none, we will now move to the consideration of the first
bill on the agenda, H.R. 7352, the ‘‘PPP and Bank Fraud Enforce-
ment Harmonization Act of 2022,’’ introduced by myself and co-
sponsored by Ranking Member Luetkemeyer.
The bill sets the statute of limitation for all cases of PPP fraud
at 10 years, consistent with the statute of limitations for bank
fraud.
I will now recognize myself briefly.
Under current law, bank-originated PPP fraud is being pros-
ecuted as bank fraud, which has a 10-year statute of limitations.
Yet, fintech originated PPP loans are prosecuted as wire fraud
which only carries a 5-year statute of limitations. Given the volume
of PPP loans and the diligence required by our investigators to
identify and build cases against bad actors, my bill addresses this
discrepancy by creating uniformity for all PPP loans. It gives pros-
ecutors 10 years to prosecute all cases of PPP fraud regardless of
whether the lender was a bank or fintech company.
This is important because SBA’s Office of Inspector General iden-
tified over 70,000 loans totaling over $4.6 billion in potentially
fraudulent PPP loans. Reports have found that fintechs handled 75
percent of PPP loans connected to fraud despite originating only 15
percent of the loans overall. Given the magnitude of the potential
fraud in this program, we must ensure prosecutors have sufficient
time to fully investigate and bring these cases forward.
Currently, nonbank PPP loans secured in April 2020 will expire
in 2025, less than 3 years away. This is simply not enough time
given the complexity of these fraud schemes and the reality that
we are only beginning to learn the full scope of fraud during the
loan forgiveness process.
I take our committee’s oversight role over the SBA and this pro-
gram very seriously. That is why I introduced this bill which will
go a long way towards enhancing oversight and accountability for
the biggest program in the agency’s history. Let’s be clear, Demo-
crats and Republicans agree anyone who took advantage of this
once-in-a-lifetime crisis to commit fraud and line their own pockets
must be held accountable. It is unacceptable to allow anyone to get
off the hook simply because the statute of limitations expired. We
must give law enforcement the time they need to bring the
fraudster to justice.
I would now like to recognize the Ranking Member for an open-
ing statement.
Mr. LUETKEMEYER. Thank you, Madam Chair.
When Members of Congress created the Paycheck Protection Pro-
gram, we focused on ensuring dollars were delivered to small busi-
nesses in an effective and efficient manner. This was accomplished
by requiring private sector lenders to play an important role in the
program.
The success of the program cannot be diminished. By the end of
the program, nearly $800 billion in forgivable loans were delivered
to the nation’s small businesses. To this day, I continue to hear
from small business owners that this program saved them and
their employees.
Unfortunately, and with any federal program, especially one of
this magnitude, fraud will develop and occur. According to the most
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recent numbers from the Small Business Administration’s Inspec-
tor General, there is approximately $4.6 billion in potentially
fraudulent loans within the PPP. While limited as compared to the
SBA’s direct EIDL program, fraud is fraud and it must be ad-
dressed swiftly and comprehensively.
While most private sector lenders performed admirably and en-
sured oversight defenses were strong due to the federal financial
rules and regulations such as Know Your Customer, independent
studies and reports continue to highlight that some fintech lenders
were more associated with fraudulent loans than other lenders. To
ensure law enforcement officials have the tools and time at their
disposal to track down all fraudulent activity, H.R. 7352 har-
monizes the statute of limitations for all PPP loans out to 10 years.
Without this important legislation, that statute of limitations
within PPP will be different based on the type of lender involved.
For example, bank fraud, which encompasses most lenders would
stand at 10 years, but wire fraud, which is associated with fintech
lenders, would stand at 5 years. Given the disparaging timelines,
it was essential to move the statute of limitations for all PPP loans
out to 10 years.
As Congress continues to examine and analyze the COVID-19 re-
lief programs, it is critical that we examine all lending partici-
pants. Importantly, Congress required the Treasury Department
and the Secretary of the Treasury to bring new lenders into the
program and to help reach the nation’s small businesses.
As we continue to look into this, I assure you that we will have
very important questions that need to be asked of the Secretary of
the Treasury. Unfortunately, she continues to ignore the law and
not appear before this committee. I hope this issue can be resolved
soon as we have important work to do with examining lender par-
ticipation within PPP. In the meantime, this is an important bill
that will allow law enforcement to do their job.
I want to thank the Chair for working with me on this legislation
and urge my colleagues to join us and ensure fraud is tracked down
no matter where, when, or how it occurred.
With that, Madam Chair, I yield back.
Chairwoman VELÁZQUEZ. The gentleman yields back.
Are there any other Members who wish to be recognized for a
statement on H.R. 7352?
I want to thank the Ranking Member for his bipartisanship on
this bill and I urge a yes vote.
If there is no further discussion, the committee will move on to
consideration of H.R. 7352.
The clerk will report the bill.
The CLERK. H.R. 7352, the PPP and Bank Fraud Enforcement
Harmonization——
Chairwoman VELÁZQUEZ. Without objection, H.R. 7352 is con-
sidered as read and open for amendment at any point.
Does anyone seek recognition to offer an amendment?
Seeing none, the question is now on H.R. 7352.
All those in favor say aye.
All those opposed say no.
In the opinion of the Chair, the ayes have it and H.R. 7352 is
agreed to.
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The question now occurs on reporting H.R. 7352 favorably to the
House.
All those in favor say aye.
All those opposed say no.
In the opinion of the Chair, the ayes have it and H.R. 7352 is
reported to the House.
Without objection, committee staff is authorized to correct punc-
tuation and make other necessary technical corrections and con-
forming changes.
Without objection, Members have 2 business days to file addi-
tional supplemental, dissenting, and minority views.
H.R. 7334
We will now consider H.R. 7334, the ‘‘COVID-19 EIDL Fraud
Statute of Limitations Act of 2022,’’ introduced by Ranking Member
Blaine Luetkemeyer and cosponsored by myself.
Similar to the PPP and Bank Fraud Enforcement Harmonization
Act, this bill extends the statute of limitations for COVID EIDL
fraud cases to 10 years to allow prosecutors more time to inves-
tigate these cases and bring charges.
I would now like to recognize the Ranking Member for an open-
ing statement.
Mr. LUETKEMEYER. Thank you, Madam Chair. And thank you
for working with me on H.R. 7334, the ‘‘COVID-19 EIDL Fraud
Statute of Limitations Act of 2022.’’
Similar to the previous bill, H.R. 7334 will ensure law enforce-
ment has the runway to conduct investigations and bring to justice
any illegal behavior that occurred with the SBA’s Economic Injury
Disaster Loan program. Unfortunately, the SBA’s Inspector Gen-
eral has flagged this program as one that has experienced an in-
creased level of fraud and activity. According to numerous govern-
ment reports, of the approximately $400 billion in loans and grants
directly handed out by the SBA, more than $80 billion could be po-
tentially fraudulent. This represents a fraud rate of approximately
20 percent. These are taxpayer dollars on the line. This is unac-
ceptable.
Moreover, the SBA recklessly continues to allow small businesses
to defer their payments within the EIDL program. We will not see
the true performance of the program, nor will we understand the
true extent of fraud within the program until payments are re-
quired. Each month of the deferment period represents time that
law enforcement officials need to catch criminals.
My bill, H.R. 7334, the ‘‘COVID-19 EIDL Fraud Statute of Limi-
tations Act of 2022’’ will lengthen the statute of limitations for all
EIDL loans and grants out to 10 years. As a sole lender, the SBA
is not a depository institution, and therefore, crimes were on a
much shorter statute of limitations. With more than $80 billion in
fraudulent lending within one program, it is obvious the SBA does
not know how to administer, nor underwrite loans on their own.
H.R. 7334 will allow law enforcement to correct some of these
wrongdoings.
With that, I urge my colleagues to support H.R. 7334, and
Madam Chair, I yield back the balance of my time.
Chairwoman VELÁZQUEZ. The gentleman yields back.
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I would now like to recognize the gentlewoman from New York,
Ms. Tenney, for an opening statement.
Ms. TENNEY. Thank you, Madam Chairwoman, and Ranking
Member Luetkemeyer, for introducing this legislation.
Since the onset of the pandemic, Congress has passed several
COVID-19 relief bills totaling an unprecedented $5.3 trillion. While
some of this spending was unwise, other programs, like the Pay-
check Protection Program and the COVID-19 Economic Injury Dis-
aster Loan program provided much-needed relief to employers and
businesses devastated by the pandemic. However, since these
measures were passed, we have learned about many alarming
cases of fraud, waste, and abuse in the funding programs that
these bills authorized. This is one reason I introduced the House
version of the Transparency in COVID-19 Expenditures Act which
should require an audit of all federal COVID-19 relief spending.
There is, obviously, room for improvement in providing addi-
tional oversight and returning fraudulently awarded funds back to
the taxpayers. The COVID-19 EIDL Fraud Statute of Limitations
Act of 2022 will help fix part of the shortcoming by expanding the
statute of limitations for the Economic Injury Disaster Loans from
6 years to 10 years as the Ranking Member mentioned. This is the
same as in bank fraud. This will give the officials a greater window
to track down fraudulent activity and hold these bad actors ac-
countable on behalf of the taxpayers. No one should be wrongly
profiting from the need to distribute during the pandemic. The
American taxpayers deserve better. That is why I fully support this
legislation and urge all of my colleagues to support it as well.
And with that I yield back. Thank you.
Chairwoman VELÁZQUEZ. Thank you. The gentlewoman yields
back.
Are there any other Members who wish to be recognized for a
statement on H.R. 7334?
Mr. MEUSER. Madam Chair?
Chairwoman VELÁZQUEZ. Yes.
Mr. MEUSER. Thank you, Madam Chair. And thank you to the
Ranking Member.
The EIDL Loan Program——
Chairwoman VELÁZQUEZ. The gentleman is recognized for 5
minutes.
Mr. MEUSER. Oh, I am sorry. Thank you, Ma’am.
The EIDL Loan Program was another relief program, as we all
know, that provided relief for struggling small businesses during
the pandemic. The EIDL program, unlike the Paycheck Protection
Program, was a direct loan program administered by the SBA. The
SBA’s Inspector General, as the Ranking Member mentioned, esti-
mates that approximately $84 billion of the EIDL loan activity,
nearly 20 percent, perhaps over 20 percent, was potentially fraudu-
lent. With this massive level of potentially fraudulent activity, it is
imperative that we pass Ranking Member Luetkemeyer’s bill to ex-
tend the 5-year statute of limitations that currently exists for SBA
grants and loans. In doing so, we can allow for authorities to inves-
tigate the egregious amount of potential fraud in the EIDL pro-
gram and ensure accountability for those who took advantage of
the EIDL program to defraud the American people.
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I urge my colleagues to support this important legislation and
look forward to its swift consideration on the House floor.
I yield back.
Chairwoman VELÁZQUEZ. The gentleman yields back.
Are there any other Members who wish to be recognized on H.R.
7334?
I would now like to recognize myself for 5 minutes.
Congress notified the EIDL program at the outset of the pan-
demic to allow small businesses facing economic injury due to
COVID to apply for SBA disaster loans. Overall, the COVID EIDL
program has approved almost 4 million loans totaling over $378
billion. The program was a lifeline to millions of small businesses
as they recovered from the COVID-19 disaster economic impacts.
Early in the program, SBA lowered guardrails and disbursed
funds quickly to provide stability to the small business economy,
which has led to the fraud we are seeing today. Throughout the
pandemic, our committee held numerous oversight hearings with
the SBA Inspector General. Most recently, he testified it will be a
decades-long effort to fully investigate an estimated $78 billion in
potentially fraudulent activity as well as over $6 billion in loans
and grants related to identify theft.
Given the magnitude of this program and the degree of potential
fraud, we need to give prosecutors more time to hold these pan-
demic fraudsters accountable, and this bill will do just that.
I thank the Ranking Member for his introduction, and I am
pleased to support it.
If there is no further discussion, the committee will move on to
consideration of H.R. 7334.
The clerk will report the bill.
The CLERK. H.R. 7334, the COVID——
Chairwoman VELÁZQUEZ. Without objection, H.R. 7334 is con-
sidered as read and open for amendment at any point.
Does anyone seek recognition to offer an amendment?
Seeing none, the question is now on H.R. 7334.
All in favor say aye.
All those opposed say no.
In the opinion of the Chair, the ayes have it and H.R. 7334 is
agreed to.
The question now occurs on reporting H.R. 7334 favorably to the
House.
All those in favor say aye.
All those opposed say no.
In the opinion of the Chair, the ayes have it and H.R. 7334 is
reported to the House.
Without objection, committee staff is authorized to correct punc-
tuation and make other necessary technical corrections and con-
forming changes.
Without objection, Members have 2 business days to file addi-
tional supplemental, dissenting, and minority views.
H.R. 7622
We will now consider H.R. 7622, the ‘‘Small Business Workforce
Pipeline Act of 2022,’’ introduced by Mr. Crow, the Chairman of the
Subcommittee on Innovation, Entrepreneurship, and Workforce De-
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velopment, and cosponsored by Representatives Fitzgerald,
Houlahan, and Garbarino.
This bill empowers Small Business Development Centers to help
small firms improve their apprenticeship and job training pro-
grams.
I would now like to recognize the gentleman from Colorado, Mr.
Crow, the sponsor of the bill for an opening statement.
Mr. CROW. Madam Chairwoman, thank you for the opportunity
to speak in support of H.R. 7622, the ‘‘Small Business Workforce
Pipeline Act of 2022.’’
Just last week, I visited the Aurora South Metro Small Business
Development Center which provides training and counseling to
hundreds of small businesses in Colorado’s 6th Congressional Dis-
trict. During this visit, I heard about the issues facing local small
businesses, including small businesses and their difficulty finding
qualified workers. We also spoke about solutions for small busi-
nesses like the Small Business Workforce Pipeline Act.
The Small Business Workforce Pipeline Act aims to empower
Small Business Development Centers, like Aurora’s South Metro
SBDC in my district, to help small businesses establish and im-
prove their apprenticeship programs, or pre-apprenticeship, or job
training programs. Work-based learning opportunities, like appren-
ticeships, help small businesses fill job openings and get the work-
ers the skills that they need to succeed, not just individually but
also within the business context.
Offering work-based learning opportunities is a great way to at-
tract quality candidates who may not be able to attend traditional
education models and provide skills-based knowledge necessary to
fill critical jobs. Basically, what we want to do is allow people to
earn while they learn. People already have families, they have obli-
gations, they have mortgages, they have a rent payment. Most peo-
ple who are upskilling or reskilling do not have the ability to go
back to school and earn nothing, and apprenticeship programs are
very critical to fill this gap.
I want to thank Representatives Fitzgerald, Houlahan, and
Garbarino for their partnership on this bill, and I urge my col-
leagues to support H.R. 7622. I thank the Chairwoman for the op-
portunity to speak on its behalf. I yield back.
Chairwoman VELÁZQUEZ. The gentleman yields back.
Now I would like to recognize the gentleman from Wisconsin, Mr.
Fitzgerald, for an opening statement.
Mr. FITZGERALD. Thank you, Madam Chair. I want to thank
my colleague, Mr. Crow, for inviting me to co-lead H.R. 7622. The
bill would allow Small Business Development Centers to provide
information and assistance to small businesses on how to establish
and improve work-based learning opportunities, apprenticeship
programs, pre-apprenticeship programs, and other job training pro-
grams.
I hear all the time in Wisconsin, in my district’s small businesses
every day about how the country’s labor shortage is affecting the
recruitment of skilled employees, particularly in the manufacturing
sector. I have a lot of small, manufacturing, light manufacturing in
the 5th Congressional. The latest NFIB Small Business Economic
Trends Report showed that while optimism is recovering to pre-
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pandemic levels and it has been increasing, more than 60 percent
of manufacturing firms report unfilled job openings.
Apprenticeships and other job training programs provide a solu-
tion to address the needs of the manufacturing sector. Apprentice-
ships are among the most successful forms of workforce develop-
ment through paid, on-the-job training, along with classroom edu-
cation.
This bill will directly benefit manufacturers and other businesses
in Wisconsin’s 5th District by having apprenticeship and other job
training materials readily available to them. I support the passage
of the bill and I would yield back.
Chairwoman VELÁZQUEZ. The gentleman yields back.
Now I recognize the gentlelady from Pennsylvania, Ms.
Houlahan, for an opening statement.
Ms. HOULAHAN. Thank you, Chairwoman Velázquez, and
Ranking Member Luetkemeyer, for the opportunity to speak on
H.R. 7622, the ‘‘Small Business Workforce Pipeline Act of 2022.’’ I
am very proud to help introduce this strong, bipartisan effort
alongside my colleagues, Representatives Crow, Fitzgerald, and
Garbarino.
H.R. 7622 makes a very timely and much-needed change that al-
lows Small Business Development Centers to be able to provide ap-
prenticeships, pre-apprenticeships, and job training programs that
will assist our small businesses. In traveling throughout my com-
munity in Pennsylvania, small business owners in Chester and
Berks counties have shared over and over again that they simply
cannot find workers with the technical experience needed to fill
their abundant job openings. Through this legislation, business
owners will be able to provide apprenticeship and on-the-job train-
ing that would be able to do just that through accessing critical en-
trepreneurial development resources at their Small Business Devel-
opment Centers.
Additionally, it will allow workers to reskill, to upskill, and to
gain the experience that they need to be able to succeed in our 21st
century economy. This is critical as our small business owners, our
entrepreneurs, and our workforce continues to recover from this
pandemic.
So, I eagerly and enthusiastically encourage all of my colleagues
to support H.R. 7622, the Small Business Workforce Pipeline Act.
With that, Madam Chair, I yield back the balance of my time.
Thank you.
Chairwoman VELÁZQUEZ. The gentlelady yields back.
Are there any other Members who wish to be recognized for a
statement on H.R. 7622?
Now I recognize the gentleman, the Ranking Member, Mr.
Luetkemeyer.
Mr. LUETKEMEYER. Thank you, Madam Chair.
I would like to thank the gentleman from Colorado, Congressman
Crow, as well as Congressman Fitzgerald, Congresswoman
Houlahan, and Congressman Garbarino, for working on this legis-
lation.
This Congress, the committee has heard from Small Business De-
velopment Centers (SBDCs) and small businesses who have bene-
fitted from SBDC services. This legislation will improve the SBDCs
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in their mission to serve small businesses. Specifically, this legisla-
tion will empower SBDCs to assist small businesses in establishing
and improving work-based learning opportunities and apprentice-
ship programs. It also allows SBDCs to share information from the
Department of Labor and other federal agencies related to work-
based learning and apprenticeships.
This legislation comes at a critical time as our small business
community faces labor and skill shortages. NFIB’s recent survey of
small business owners found that 23 percent of owners report labor
quality as a top business problem. Further, of those owners hiring
or trying to hire, 93 percent of owners reported few or no qualified
applicants for the positions they are trying to fill. Apprenticeships
and learning opportunities help American workers gain new skills
and support small business growth.
With that, Madam Chair, I urge my colleagues to support H.R.
7622, and I yield back the balance of my time.
Chairwoman VELÁZQUEZ. The gentleman yields back.
Now I recognize myself briefly.
The SBDC program is the SBA’s largest resource partner deliv-
ering free and low-cost counseling and training through its network
of 62 lead centers and nearly 1,000 subcenters throughout the
country. One particular area that small firms need assistance with
is how to retract, retain, and train skilled workers. Small busi-
nesses have been hit hard by tight labor markets, often struggling
to compete with their larger counterparts. With a record number
of jobs available in the economy and an unemployment rate of just
3.6 percent, employers are finding it harder and harder to find
qualified applicants.
H.R. 7622 directs SBDCs to assist small firms that are struggling
to find employees by sharing information regarding apprentice-
ships, pre-apprenticeships, and other forms of job training. Pro-
grams like this are highly successful workforce development pro-
grams with an average starting salary of $72,000 and an employee
retention rate of 92 percent. Apprenticeships not only provide a
pathway into the middle class but high-quality employees to busi-
nesses. With the assistance provided by the SBDC network, more
small firms will have access to the resources they need to attract
high-quality talent.
I want to thank Representatives Crow, Fitzgerald, Houlahan,
and Garbarino for their work in helping small businesses attract
highly skilled and qualified workers. I urge a yes vote.
If there is no further discussion, the Committee will move on to
consideration of H.R. 7622.
The clerk will report the bill.
The CLERK. H.R. 7622, the Small Business Workforce Pipeline
Act——
Chairwoman VELÁZQUEZ. Without objection, H.R. 7622 is con-
sidered as read and open for amendment at any point.
Does anyone seek recognition to offer an amendment?
Seeing none, the question is now on H.R. 7622.
All in favor say aye.
All those opposed say no.
In the opinion of the Chair, the ayes have it and H.R. 7622 is
agreed to.
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The question now occurs on reporting H.R. 7622 favorably to the
House.
All those in favor say aye.
All those opposed say no.
In the opinion of the Chair, the ayes have it and H.R. 7622 is
reported to the House.
Without objection, committee staff is authorized to correct punc-
tuation and make other necessary technical corrections and con-
forming changes.
Without objection, Members have 2 business days to file addi-
tional supplemental, dissenting, and minority views.
H.R. 7664
We will now consider H.R. 7664, the ‘‘Supporting Small Business
and Career and Technical Education Act of 2022,’’ introduced by
Vice Ranking Member, Mr. Williams, and cosponsored by Ms. New-
man. This legislation directs SBDCs and WBCs to assist small
businesses in hiring graduates from career and technical education
programs and helps graduates launch their own businesses.
I would now like to recognize the gentleman from Texas, Mr.
Williams, the sponsor of the bill, for an opening statement.
Mr. WILLIAMS. Thank you, Madam Chairwoman. I want to
thank the Chairwoman and Ranking Member for including my bill
in today’s markup, H.R. 7664, known as the Supporting Small
Business and Career and Technical Education Act. It is an impor-
tant piece of legislation that will provide career and technical edu-
cation graduates with additional support as they enter the work-
force or start their own business.
The growing skills gap is hitting small businesses across the
country extremely hard, and our country needs more plumbers,
electricians, mechanics, and other skilled professionals who are the
lifeblood of this economy. A traditional 4-year college degree is not
always for everyone, and we need to ensure students know that
there are other providers that will provide them with good-paying
jobs and a successful career.
My bill directs Small Business Development Centers and Wom-
en’s Business Centers to assist small businesses in hiring grad-
uates from career and technical education programs, as well as as-
sisting CTE graduates in starting up a small business of their own.
America is in a critical need of skilled workers, which is why we
should encourage younger generations to pursue a career in tech-
nical education paths. CTE programs prepare individuals for high-
demand occupations that earn good wages and allow individuals to
provide for their families. CTE is a return on investment by setting
students up to learn a skill which they can master over the years
and hopefully turn into their own small businesses one day.
I want to thank Chairwoman Velázquez, Ranking Member
Luetkemeyer, and all the staff who have helped in getting this bill
brought up in the committee. It is important that we support the
CTE professional in developing the necessary skills to become a
business owner and assist in connecting graduates with an existing
business in need of their unique skillset.
I urge all of my colleagues to support H.R. 7664, and I yield back
the balance of my time.
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Chairwoman VELÁZQUEZ. Thank you. The gentleman yields
back.
Now, I would like to recognize the gentlelady from Illinois, Ms.
Newman, for an opening statement.
Ms. NEWMAN. Thank you, Madam Chair, and thank you, Rank-
ing Member Luetkemeyer, for having this very important hearing.
I would like to talk about H.R. 7664.
I join my colleague today, Rep. Williams, in strong support of
H.R. 7664, the Supporting Small Business and Career and Tech-
nical Education Act. This bill would increase CTE programs so it
is very important. It would direct Small Business Development
Centers, otherwise known as SBDCs and Women’s Business Cen-
ters, WBCs, to assist small businesses in hiring graduates from ca-
reer and technical education programs, in addition to the existing
services which are amazing.
As a prior small business owner, I know firsthand the impor-
tance of strengthening trade and issues which are a key component
of building a 21st century economy that actually works for every-
body, everywhere.
While a 4-year degree remains an important path to rebuilding
our workforce with skills, we also have to remember all of our
other folks that do great work in the trades. This bill also relies
on our valuable resource partners including WBCs. WBCs are de-
signed from entrepreneurs who are socially and economically dis-
advantaged. In starting and growing small businesses through edu-
cation and training, WBCs have spread across the country and will
continue to be a factor as we grow our solutions and our workforce.
It is critical to ensure that all of our youth have the opportunity
that they need and the resources to develop critical skills that will
lead them to good paying jobs—our skilled workforce is vital to a
strong economy. I am proud to introduce H.R. 7664 with Rep. Wil-
liams and I urge my colleagues to support the bill.
Thank you, and I yield back.
Chairwoman VELÁZQUEZ. The gentlelady yields back.
Are there any other Members who wish to be recognized for a
statement on H.R. 7664?
Ranking Member?
Mr. LUETKEMEYER. Madam Chair?
Chairwoman VELÁZQUEZ. Yes. The Ranking Member is recog-
nized.
Mr. LUETKEMEYER. Thank you, Madam Chair. And thank Mr.
Williams and Ms. Newman for their work on this great legislation.
Vice Ranking Member Williams is a strong advocate for small busi-
nesses and the American worker, and I appreciate his work on this
legislation to engage with the career and technical education com-
munity to support small business growth.
Career and technical education programs are so important for in-
dividuals across the nation because they help high school, commu-
nity college, and trade school students obtain the hands-on experi-
ence they need for jobs in a broad range of industries. This legisla-
tion directs the Small Business Development Centers (SBDCs) and
Women’s Business Centers (WBCs) to assist small businesses in
hiring graduates from career and technical education programs.
Additionally, this legislation supports career and technical edu-
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cation graduates by directing SBDCs and WBCs to assist them in
starting a small business.
With that, Madam Chair, I urge my colleagues to support H.R.
7664, and I yield back.
Chairwoman VELÁZQUEZ. The gentleman yields back.
Are there any other Members who wish to be recognized for a
statement?
I would now like to recognize myself briefly.
Whether it is accessing capital, developing a business plan, or as-
sisting in a marketing strategy, SBA resource partners play a cru-
cial role in helping small businesses thrive. Over the past few
years, we have heard about the struggles that many small firms
face in finding a skilled workforce. A poll of over 6,000 small busi-
nesses throughout the country found that roughly three in five are
having issues hiring talent. H.R. 7664 utilizes SBDCs and WBCs
by assisting small firms looking for talent and recent graduates in-
terested in becoming entrepreneurs. It requires SBDCs and WBCs
to build awareness of career and technical education programs
among small business owners and develop close partnerships to
help bridge the gap between training programs and small firms
struggling to find workers. I applaud the work of Representatives
Williams and Newman on this bill connecting graduates of career
and technical education programs with small businesses, and I
urge a yes vote.
If there is no further discussion, the committee will move on to
consideration of H.R. 7664.
The clerk will report the bill.
The CLERK. H.R. 7664, the Supporting Small Business——
Chairwoman VELÁZQUEZ. Without objection, H.R. 7664 is con-
sidered as read and open for amendment at any point.
Does anyone seek recognition to offer an amendment?
Seeing none, the question is now on H.R. 7664.
All those in favor say aye.
All those opposed say no.
In the opinion of the Chair, the ayes have it and H.R. 7664 is
agreed to.
The question now occurs on reporting H.R. 7664 favorably to the
House.
All those in favor say aye.
All those opposed say no.
In the opinion of the Chair, the ayes have it and H.R. 7664 is
reported to the House.
Without objection, committee staff is authorized to correct punc-
tuation and make other necessary technical corrections and con-
forming changes.
Without objection, Members have 2 business days to file addi-
tional supplemental, dissenting, and minority views.
H.R. 7670
We will now consider H.R. 7670, the ‘‘Women-Owned Small Busi-
ness Program Transparency Act’’ introduced by Representative
Houlahan and cosponsored by Representative Tenney, Ranking
Member of the Subcommittee on Underserved, Agricultural, and
Rural Business Development.
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This bill establishes a reporting requirement for the Women-
Owned Small Business Contracting Program.
I would now like to recognize the gentlewoman from Pennsyl-
vania, Ms. Houlahan, the sponsor of the bill, for an opening state-
ment.
Ms. HOULAHAN. Thank you.
First, I would like to thank you, Chairwoman Velázquez, and
Ranking Member Luetkemeyer, for organizing this bipartisan
markup and for bringing H.R. 7670, the ‘‘Women-Owned Small
Business Program Transparency Act’’ before our committee along-
side these other very important bipartisan measures.
I also want to thank Representative Claudia Tenney for her part-
nership in introducing this legislation.
The SBA’s Women-Owned Small Business Contracting Program
helps to level the playing field by reserving federal contracting op-
portunities for qualified women-owned small businesses in under-
represented industries. Through this program, the SBA aids other
federal agencies in meeting the statutory goal of awarding 5 per-
cent of all prime federal contracts to women-owned small busi-
nesses.
While the SBA has made great strides towards improving the
program in recent years, including transitioning to full SBA certifi-
cation for businesses that participate in the program, additional
transparency and oversight is needed to address ongoing program
challenges.
The WOSB program has only met its 5 percent statutory goal
twice, most recently attaining 4.85 percent in fiscal year 2020. In
addition to the underutilization of the women-owned companies in
federal contracting, the SBA is also facing a significant backlog of
applications and there is very little visibility into how many firms
are being certified by the four national certifying entities that are
approved by the SBA. The Government Accountability Office has
also issued concerns regarding the needed improvements to pro-
gram examinations and to contracts that are being awarded to
businesses in eligible industries.
To address these concerns, H.R. 7670 requires the SBA to submit
to Congress an annual report which would benchmark crucial data,
including the amount of contracting dollars that are awarded
through the program, the number of certifications that are being
issued, the amount of program examinations being conducted, the
number of companies that are being decertified, and the number of
contracts that are incorrectly awarded, as well as any other actions
taken by the SBA to properly train personnel in other agencies.
The bill will increase transparency and oversight, allowing Con-
gress and the SBA to further improve the program, to work to-
wards efficiencies, and to properly allow for program administra-
tion, and ultimately, of course, to benefit women in securing gov-
ernment contracts, especially those in underrepresented industries.
Improvements to the SBA’s Women-Owned Small Business Con-
tracting Program are especially needed as our business owners are
continuing to recover from the pandemic. As additional federal con-
tracts are issued through the historic implementation of the bipar-
tisan Infrastructure Investment and Jobs Act, it is critical that
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Congress has access to the data which will be required by this leg-
islation.
Women-owned businesses are still underutilized in federal con-
tracting and greater oversight must be established to ensure that
the program is working as it is intended.
I urge my colleagues enthusiastically to support H.R. 7670. With
that, I yield back the remainder of my time, Madam Chair.
Chairwoman VELÁZQUEZ. The gentlelady yields back.
Now we recognize the gentlelady from New York, Ms. Tenney, for
an opening statement.
Ms. TENNEY. Thank you, Chairwoman Velázquez and Ranking
Member Luetkemeyer. I, too, echo the comments of my colleague,
Representative Houlahan. And having this bipartisan markup, it is
great for our small business community. Also, I am just pleased to
be cosponsoring 7670, the ‘‘Women-Owned Small Business Program
Transparency Act’’ because I think it is really important.
For over 2 decades, the Women-Owned Small Business Program
has set aside at least 5 percent of federal contracting dollars for
certified women-owned small businesses. This plays a small part,
but important part, ensuring that the federal government does not
leave our nation’s small businesses behind and that we continue to
have a robust and competitive contractor ecosystem to pull from.
In New York’s 22nd Congressional District, small businesses
make up 94 percent of all employees, and I have seen the tremen-
dous impact that women-owned small businesses had. Whether it
is my good friend Gina Curcio, who runs Curcio Printing in the
Southern Tier or a wonderful company called AeroMed Tech-
nologies in Utica, our communities and our taxpayers benefit from
women-owned businesses, especially when they thrive. My family
business, which has been around since 1946, is also a women-
owned business.
However, even with this proven track record, the Women-Owned
Small Business program has room for improvement. The Small
Business Administration still does not transparently disclose some
in-depth performance metrics that would allow us to ensure the
program meets the needs of small business owners.
That is why I was glad to partner with Representative Houlahan
earlier this month to introduce this bipartisan Women-Owned
Small Business Program Transparency Act. This legislation will re-
quire the Small Business Administration to annually disclose the
total number of businesses that are certified as women-owned by
the SBA, the number certified by third-party certifiers, and the fees
charged by third-party certifiers, the dollar amount, and the per-
cent of contracts to Women-Owned Small Businesses and the infor-
mation on contracts incorrectly awarded. This is going to be essen-
tial in ensuring that we have transparency and that we can ensure
that this program works effectively and efficiently for the small
businesses and for taxpayers and the women who are out there
putting their all in courageously trying to thrive as small business
owners and entrepreneurs in our communities.
With that, I want to again thank my cosponsor and also the
Ranking Member and our Chairwoman for doing a great job in this
markup and for bringing this important bill to the floor. I yield
back.
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Chairwoman VELÁZQUEZ. The gentlelady yields back.
Are there any other Members who wish to be recognized for a
statement on H.R. 7670?
I now recognize the Ranking Member, Mr. Luetkemeyer.
Mr. LUETKEMEYER. Thank you, Madam Chair.
Part of our congressional duties and responsibilities is proper
oversight of federal programs. H.R. 7670, the ‘‘Women-Owned
Small Business Program Transparency Act’’ will enhance and
strengthen the oversight requirements of the SBA on important
federal contracting programs. The more information that is at our
disposal will lead to more efficient and effective policymaking.
I want to thank Ms. Houlahan from Pennsylvania, and Ms.
Tenney from New York, for working in a bipartisan manner to in-
crease transparency within one of SBA’s federal government con-
tracting programs.
With that, Madam Chairwoman, I want to thank you for working
with me to advance this bill. I urge my colleagues to support this
bill to ensure the SBA has a clear lens to view the Women-Owned
Small Business Contracting Program. Thank you.
Chairwoman VELÁZQUEZ. The gentleman yields back.
Now I recognize myself.
Combatting the continuous barriers women entrepreneurs face in
accessing federal contracts, I led Congress in creating the Women-
Owned Small Business Contracting Program in 2000. The program
has greatly improved since it was first implemented. However,
there are a number of issues that require congressional oversight
to ensure it is working as intended. For example, even though the
program is supposed to help agencies in meeting the 5 percent
women-owned small business goal, this goal has only been met
twice despite it being 2022. The SBA just recently started pro-
viding formal certifications to program participants. While progress
is being made, there is still a significant backlog of applications. In
considering the GAO reports issued regularly on the program, Con-
gress must keep an eye on program examinations and any con-
tracts incorrectly awarded.
H.R. 7670 requires SBA to provide Congress with the necessary
data to oversee these matters and more. This bill furthers trans-
parency and accountability by creating a reporting requirement for
the Women-Owned Small Business Program. This is an issue we
should never lose sight of.
I thank Ms. Houlahan and Ms. Tenney for their bipartisan work
on this bill, and I urge a yes vote.
If there is no further discussion, the committee will move on to
consideration of H.R. 7670.
The clerk will report the bill.
The CLERK. H.R. 7670, the Women-Owned Small Business Pro-
gram——
Chairwoman VELÁZQUEZ. Without objection, H.R. 7670 is con-
sidered as read and open for amendment at any point.
Does anyone seek recognition to offer an amendment?
Seeing none, the question is now on H.R. 7670.
All in favor say aye.
All opposed say no.
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In the opinion of the Chair, the ayes have it and H.R. 7670 is
agreed to.
The question now occurs on reporting H.R. 7670 favorably to the
House.
All those in favor say aye.
All those opposed say no.
In the opinion of the Chair, the ayes have it and H.R. 7670 is
reported to the House.
Without objection, committee staff is authorized to correct punc-
tuation and make other necessary technical corrections and con-
forming changes.
Without objection, Members have 2 business days to file addi-
tional supplemental, dissenting, and minority views.
H.R. 5879
We will now consider H.R. 5879, the ‘‘HUBZone Price Evaluation
Preference Clarification Act of 2021,’’ introduced by Ms. Newman
and cosponsored by Ms. Salazar, the Ranking Member of the Sub-
committee on Contracting and Infrastructure. This bill clarifies
that the HUBZone Price Evaluation Preference applies to orders.
Are there any other Members who wish to be recognized for a
statement on H.R. 5879?
I would now like to recognize the gentlewoman from Illinois, Ms.
Newman, the sponsor of the bill for an opening statement.
Ms. NEWMAN. Thank you, Madam Chair and Ranking Member
Luetkemeyer.
I rise in strong support of the bipartisan bill H.R. 5879, the
‘‘HUBZone Price Evaluation Preference Clarification Act of 2021.’’
This legislation is designed to expand contracting opportunities to
small businesses located historically in underutilized sectors. This
bill would amend current trends to ensure more federal spending
is devoted to SBA’s HUBZone program, which could then be used
to expand the number of federal and private contracting opportuni-
ties for local entrepreneurs and small businesses.
The SBA’s historically underutilized empowerment contracting
programs, also known as the HUBZone program, is designed to
provide small businesses located in low-income areas or with obsta-
cles for high unemployment with contracting.
Currently, the HUBZone price evaluation preference is not wide-
ly used because some agencies have incorrectly interpreted that the
preference does not apply to order. As the federal government
drives its spending through indefinite means a significant oppor-
tunity for HUBZone spending is being lost because the HUBZone
price evaluation is not being applied to award awarders. This bill
would clarify the program’s evaluation language to ensure the fed-
eral government is driving its spending toward HUBZone small
businesses.
I urge that my colleagues support this bill and I yield back my
time.
Chairwoman VELÁZQUEZ. The gentlelady yields back.
Are there any other Members who wish to be recognized for a
statement on H.R. 5879?
I would now like to recognize the Ranking Member.
Mr. LUETKEMEYER. Thank you, Madam Chair.
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I would like to thank you for bringing this bill forward and the
sponsors of the bill, Ms. Newman from Illinois, and Ms. Salazar,
the Ranking Member of the Subcommittee on Contracting and In-
frastructure from the State of Florida.
Further consolidation within the federal government’s con-
tracting space will continue to disadvantage the nation’s smallest
contractors. This bill takes an important step and ensures impor-
tant HUBZone businesses have an opportunity to compete. It is
critically important that we continue to examine this issue and pro-
pose solutions, like H.R. 5879, the ‘‘HUBZone Price Evaluation
Preference Clarification Act of 2021.’’
With that, I urge a yes vote, and I yield back the balance of my
time.
Chairwoman VELÁZQUEZ. The gentleman yields back.
Now I recognize myself briefly.
The HUBZone program promotes economic development by pro-
viding small businesses located in distressed areas greater access
to federal contracts. One of the main incentives of the program is
the HUBZone Price Evaluation Preference which will help level the
playing field when a HUBZone firm is competing against a large
business for a federal contract. Unfortunately, this incentive is not
widely used because some agencies have incorrectly interpreted
regulations to mean that the price evaluation preference does not
apply to orders. To eliminate any uncertainty, H.R. 5879 amends
the Small Business Act to explicitly state that the price evaluation
preference applies to orders. Doing so opened the doors to many
more procurement opportunities for HUBZone firms, and therefore,
paving the way for economic growth in their communities. Thanks
to the devoted efforts of Congressmembers Newman and Salazar,
there is a path to improve the HUBZone program and provide clar-
ity to federal agencies seeking to hire small contractors. I urge a
yes vote.
If there is no further discussion, the Committee will move on to
consideration of H.R. 5879.
The clerk will report the bill.
The CLERK. H.R. 5879, the HUBZone Price Evaluation——
Chairwoman VELÁZQUEZ. Without objection, H.R. 5879 is con-
sidered as read and open for amendment at any point.
Does anyone seek recognition to offer an amendment?
Seeing none, the question is now on H.R. 5879.
All those in favor say aye.
All those opposed say no.
In the opinion of the Chair, the ayes have it and H.R. 5879 is
agreed to.
The question now occurs on reporting H.R. 5879 favorably to the
House.
All those in favor say aye.
All those opposed say no.
In the opinion of the Chair, the ayes have it and H.R. 5879 is
reported to the House.
Without objection, committee staff is authorized to correct punc-
tuation and make other necessary technical corrections and con-
forming changes.
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Without objection, Members have 2 business days to file addi-
tional supplemental, dissenting, and minority views.
H.R. 7694
We will now take up the final bill on the agenda, H.R. 7694, the
‘‘Strengthening Subcontracting for Small Businesses Act of 2022,’’
introduced by Mr. Stauber and cosponsored by Mr. Mfume, the
Chair of the Subcommittee on Contracting and Infrastructure. This
bill ensures that the past compliance with subcontracting plans is
considered when determining an offeror’s past performance.
I would now like to recognize the gentleman from Minnesota, Mr.
Stauber, the sponsor of the bill, for an opening statement.
Mr. STAUBER. Thank you, Chairwoman Velázquez and Ranking
Member Luetkemeyer.
A common theme we have heard in the contracting space is that
prime contracting opportunities for small businesses are dwindling
at an alarming rate. This means that subcontracting opportunities
are more important than ever for small business contractors. While
large prime contractors are statutorily required to have subcon-
tracting plans, there is little incentive for a prime contractor to
comply with such plans. Further, there is no requirement that a
contracting officer take into consideration a large prime contrac-
tor’s performance in subcontracting with small businesses when de-
liberating new contract awards.
While it is laudable that prime contractors have subcontracting
plans, these plans seem to have minimal influence on a large prime
contractor’s motivation to award work to small business subs.
My bill, the Strengthening Subcontracting for Small Businesses
Act addresses this problem in a few ways. First, the legislation will
require contracting officers to consider a contractor’s proposed utili-
zation of small businesses in its proposed subcontracting plan. Sec-
ond, the legislation will require contracting officers to consider the
contractor’s past performance in meeting its previous subcon-
tracting plans. In short, the bill creates a strong incentive for large
prime contractors to comply with their own subcontracting plans
since it will now impact their ability to win new work.
I would like to thank my colleague, Congressman Mfume, for his
collaboration on this bill, and together, I believe we have created
meaningful legislation that will make a real and significant impact
on the way small business contracting is conducted throughout the
federal procurement environment.
I urge my colleagues to support this legislation. Madam Chair,
I yield back.
Chairwoman VELÁZQUEZ. The gentleman yields back.
Now I would like to recognize the gentleman from Maryland, Mr.
Mfume, for an opening statement.
Mr. MFUME. Thank you very much, Madam Chair. Good morn-
ing. I want to thank you for calling this markup for today and for
your leadership on small business issues over many, many years.
At a time when many of those same small businesses are at risk
of being pushed out of the federal procurement space due to forces
that are outside of their control, it is imperative that we unite
across the aisle to stand up for small business concerns and to help
support and grow their presence in the small business federal con-
tracting space.
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I am very pleased to have worked with Mr. Stauber, the distin-
guished gentleman from Minnesota, and with those Members of the
Small Business Committee staff on this bipartisan, common-sense
bill that protects small businesses by incentivizing large prime con-
tractors to adhere to this contracting plan. This bill as you heard
requires any agency that is considering proposals for contract to as-
sess the extent to which an offer complied with its subcontracting
plan in the past. By amending existing language of the Small Busi-
ness Act and also by expanding its scope, the legislation will ben-
efit contractors that interact with and treat small businesses in the
right way. It will incentivize them to do the right thing, and it will
strongly urge and encourage improvement by those contractors that
have failed to properly include and protect small businesses.
And so as such, I respectfully ask that my colleagues on the com-
mittee support H.R. 7694, the ‘‘Strengthening Subcontracting for
Small Businesses Act of 2022,’’ and I yield back the remainder of
my time. Thank you, Madam Chair.
Chairwoman VELÁZQUEZ. The gentleman yields back.
Are there any other Members who wish to be recognized for a
statement on H.R. 7694?
I would now like to recognize the Ranking Member.
Mr. LUETKEMEYER. Thank you, Madam Chair.
I support H.R. 7694, the ‘‘Strengthening Subcontracting for
Small Businesses Act of 2022.’’ While the government has certain
requirements in place supporting small businesses subcontracting,
we are missing a vital piece of this puzzle. Specifically, there is a
lack of incentive among large prime contractors to use small busi-
nesses as subcontractors in the federal sphere in a way that pro-
motes true and lasting behavioral change. I believe this bill gets us
there and I urge my colleagues to support it.
With that, Madam Chair, I yield back.
Chairwoman VELÁZQUEZ. The gentleman yields back.
Now I briefly recognize myself.
The Small Business Act seeks to promote opportunity for small
contractors to participate in the federal procurement process,
whether at the prime or subcontracting level. It requires offerors
to submit subcontracting plans for contracts that have a certain
threshold and will be awarded using negotiated procedures. The
law ensures compliance with subcontracting requirements by allow-
ing the imposition of liquidated damages if a contractor fails to en-
gage in good faith efforts to meet them. Yet, this standard is am-
biguous and not always enforced, resulting in contractors not facing
any consequences for noncompliance. What most people do not un-
derstand is just how important subcontracting plans are for small
firms. In many instances, they represent the only method to gain
a foothold into the federal marketplace. That is why it is important
that we keep looking for ways to encourage compliance. Thanks to
the diligence of Mr. Stauber and Mr. Mfume, we have an important
piece of legislation ensuring that previous compliance with subcon-
tracting plans is considered when evaluating an offeror’s past per-
formance.
I support this bill and I urge a yes vote.
If there is no further discussion, the committee will move on to
consideration of H.R. 7694.
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The clerk will report the bill.
The CLERK. H.R. 7694, the Strengthening Subcontracting——
Chairwoman VELÁZQUEZ. Without objection, H.R. 7694 is con-
sidered as read and open for amendment at any point.
Does anyone seek recognition to offer an amendment?
Seeing none, the question is now on H.R. 7694.
All in favor say aye.
All those opposed say no.
In the opinion of the Chair, the ayes have it and H.R. 7694 is
agreed to.
The question now occurs on reporting H.R. 7694 favorably to the
House.
All those in favor say aye.
All those opposed say no.
In the opinion of the Chair, the ayes have it and H.R. 7694 is
reported to the House.
Without objection, committee staff is authorized to correct punc-
tuation and make other necessary technical corrections and con-
forming changes.
Without objection, Members have 2 business days to file addi-
tional supplemental, dissenting, and minority views.
My thanks to all the Members for their participation today. If
there is no further business to come before the committee, without
objection, this meeting is adjourned. Thank you.
[Whereupon, at 11:14 a.m., the committee was adjourned.]
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APPENDIX
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Æ
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