Small Business Administration Rural Performance Report Act
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- Crpt 118Hrpt223
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- Crpt 118Hrpt223
Summary
House Report 118-223, submitted September 26, 2023 by Mr. Williams of Texas from the Committee on Small Business, together with minority views, to accompany H.R. 5265, the Small Business Administration Rural Performance Report Act. The committee reports the bill favorably without amendment. The report states that the bill would require the Small Business Administration to report within 90 days on the activities of its Office of Rural Affairs, and then annually in its budget justification, and to report on the outcomes of the memorandum of understanding with the Department of Agriculture entered into on April 4, 2018. It notes a July 26, 2023 hearing on rural entrepreneurship and a September 14, 2023 markup at which no amendments were offered. The minority views support the bill but question the memorandum of understanding reporting requirement.
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Full text
118TH CONGRESS REPORT
" HOUSE OF REPRESENTATIVES !
1st Session 118–223
SMALL BUSINESS ADMINISTRATION
RURAL PERFORMANCE REPORT ACT
SEPTEMBER 26, 2023.—Committed to the Committee of the Whole House on the
State of the Union and ordered to be printed
Mr. WILLIAMS of Texas, from the Committee on Small Business,
submitted the following
R E P O R T
together with
MINORITY VIEWS
[To accompany H.R. 5265]
The Committee on Small Business, to whom was referred the bill
(H.R. 5265) to amend the Small Business Act to require a report
on the performance of the Office of Rural Affairs, to require a re-
port on the memorandum of understanding between the Small
Business Administration and the Department of Agriculture en-
tered into on April 4, 2018, and for other purposes, having consid-
ered the same, reports favorably thereon without amendment and
recommends that the bill do pass.
CONTENTS
Page
I. Purpose and Bill Summary ........................................................................ 2
II. Need for Legislation .................................................................................... 2
III. Hearings ....................................................................................................... 2
IV. Committee Consideration ........................................................................... 3
V. Committee Votes ......................................................................................... 3
VI. Section-by-Section of H.R. 5265 ................................................................. 6
VII. Congressional Budget Office Cost Estimate ............................................. 6
VIII. New Budget Authority, Entitlement Authority, and Tax Expenditures 6
IX. Oversight Findings & Recommendations .................................................. 7
X. Performance Goals and Objectives ............................................................ 7
XI. Statement of Duplication of Federal Programs ........................................ 7
XII. Congressional Earmarks, Limited Tax Benefits, and Limited Tariff
Benefits ..................................................................................................... 7
XIII. Federal Mandates Statement ..................................................................... 7
XIV. Federal Advisory Committee Statement ................................................... 7
XV. Applicability to Legislative Branch ........................................................... 7
XVI. Statement of Constitutional Authority ...................................................... 8
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XVII. Changes in Existing Law, Made by the Bill, As Reported ...................... 8
XVIII. Minority Views ............................................................................................ 10
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I. PURPOSE AND BILL SUMMARY
On August 25, 2023, Rep. Alford along with Representatives
Luetkemeyer, Ellzey, and Bean, introduced H.R. 5265. The purpose
of H.R. 5265, the ‘‘SBA Rural Performance Report Act,’’ is to re-
quire SBA to produce two reports on activities related to rural en-
trepreneurs. The first report is on a Memorandum of Under-
standing (MOU) between the Small Business Association (SBA)
and the U.S. Department of Agriculture (USDA) on activities joint-
ly performed to conduct outreach to rural communities. The second
report is an addition to SBA’s annual budget justification to include
activities performed by SBA’s Office of Rural Affairs.
II. NEED FOR LEGISLATION
Small business owners face many challenges, especially in rural
areas. Rural communities depend on the success of their small
businesses. SBA’s Office of Rural Affairs is charged with ensuring
adequate resource availability for rural entrepreneurs. While Con-
gress authorized this Office under the George H.W. Bush presi-
dency, the office was largely vacant until the Trump Administra-
tion appointed a director. In 2018 the SBA and USDA entered into
a five-year MOU to better coordinate outreach and resources to
rural entrepreneurs. While there was clear coordination through
events and other activities, outcomes of the MOU remain unknown.
Additionally, the MOU was left to expire in April 2023. This bill
will require a report to understand the outcomes and successes of
the MOU and the future needs of greater agency coordination and
reduced duplication.
Currently there are no performance reporting requirements. This
bill requires SBA to detail exactly how it is elevating small rural
businesses by reporting on the activities of the Office of Rural Af-
fairs. The information required in SBA’s annual budget justifica-
tion will include how the office provides information about re-
sources and programs in rural areas. This bill will shed light on ex-
actly what SBA is doing to address rural entrepreneurs’ needs.
III. HEARINGS
In the 118th Congress, the Committee held one hearing exam-
ining the issues covered in H.R. 5265. On July 26, 2023, the Com-
mittee held a hearing titled ‘‘Rural Entrepreneurship: Examining
the Challenges and State of Rural Small Business.’’ Witnesses dis-
cussed challenges they face as rural entrepreneurs including a lack
of awareness of existing resources. This bill seeks to address chal-
lenges rural entrepreneurs face by holding the SBA accountable
and ensure it is meeting its mission to assist rural entrepreneurs.
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IV. COMMITTEE CONSIDERATION
The Committee on Small Business met in open session, with a
quorum being present, on September 14, 2023, and ordered H.R.
5265 reported favorably to the House of Representatives. During
the markup no amendments were offered.
V. COMMITTEE VOTES
Clause 3(b) of rule XIII of the Rules of the House of Representa-
tives requires the Committee to list the recorded votes on the mo-
tion to report legislation and amendments thereto. The Committee
voted to favorably report H.R. 5265 to the House of Representatives
at 11:43 a.m.
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VI. SECTION-BY-SECTION OF H.R. 5265
Section 1. Short title
This section cites the bill as the Small Business Administration
Rural Performance Report Act.
Section 2. Small business rural performance reports
This section requires a report within 90 days to the House and
Senate Committees on Small Business. The report will include in-
formation about the SBA Office of Rural Affairs including how the
office promotes financial assistance, compiles annual statistics, pro-
vides information, the number of outreach and information sharing
events, details of partnerships, and the name of the director of
ORA. After the initial report, this information will be required in
the annual budget justification provided to Congress.
A technical amendment updates the name of the United States
Tourism and Travel Administration to the National Travel and
Tourism Office of the Department of Commerce.
This section requires another report on the outcomes of the 2018
MOU between SBA and USDA. Information in the report will in-
clude number of working groups, number of staff that were or are
engaged with MOU designated working groups, and the findings on
the MOU activities.
Section 3. Definitions
This section defines the Administrator as the SBA Adminis-
trator, Administration as the Small Business Administration, and
the MOU as the agreement between SBA and USDA entered on
April 4, 2018.
Section 4. Compliance with CUTGO
This section states that no additional funds are authorized to be
appropriated to carry out the bill.
VII. CONGRESSIONAL BUDGET OFFICE COST ESTIMATE
Pursuant to clause 3(d)(1) of House rule XIII, the Committee
adopts as its own the cost estimate prepared by the Director of the
Congressional Budget Office pursuant to section 402 of the Con-
gressional Budget Act of 1974. The Committee has requested but
not received from the Director of the Congressional Budget Office
a cost estimate for the Committee’s provisions. Once available, the
cost estimate will be published in the Congressional Record.
VIII. NEW BUDGET AUTHORITY, ENTITLEMENT AUTHORITY, AND
TAX EXPENDITURES
Pursuant to clause 3(c)(2) of rule XIII of the Rules of the House
of Representatives and section 308(a)(I) of the Congressional Budg-
et Act of 1974, the Committee provides the following opinion and
estimate with respect to new budget authority, entitlement author-
ity, and tax expenditures. While the Committee has not received an
estimate of new budget authority contained in the cost estimate
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prepared by the Director of the Congressional Budget Office pursu-
ant to Sec. 402 of the Congressional Budget Act of 1974, the Com-
mittee does not believe that there will be any additional costs at-
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tributable to this legislation. H.R. 5265 does not direct new spend-
ing, but instead reallocates funding independently authorized and
appropriated.
IX. OVERSIGHT FINDINGS & RECOMMENDATIONS
In accordance with clause 3(c)(1) of rule XIII and clause 2(b)(1)
of rule X of the Rules of the House of Representatives, the over-
sight findings and recommendations of the Committee on Small
Business with respect to the subject matter contained in H.R. 5265
are incorporated into the descriptive portions of this report.
X. PERFORMANCE GOALS AND OBJECTIVES
With respect to the requirements of clause 3(c)(1) of rule XIII of
the Rules of the House of Representatives, the performance goals
and objectives of H.R. 5265 is to require reporting about the find-
ings of a USDA and SBA MOU, and the SBA Office of Rural Af-
fairs (ORA) to report how the Office promotes financial assistance,
compiles annual statistics, provides information, the number of out-
reach and information sharing efforts, details of partnerships, and
the name of the director of ORA.
XI. STATEMENT OF DUPLICATION OF FEDERAL PROGRAMS
Pursuant to clause 3(c)(5) of rule XIII of the Rules of the House
of Representatives, no provision of H.R. 5265 is known to be dupli-
cative of another Federal program, including any program that was
included in a report to Congress pursuant to section 21 of Public
Law 111–139 or the most recent Catalog of Federal Domestic As-
sistance.
XII. CONGRESSIONAL EARMARKS, LIMITED TAX BENEFITS, AND
LIMITED TARIFF BENEFITS
With respect to clause 9 of rule XXI of the Rules of the House
of Representatives, the Committee finds that the bill does not con-
tain any congressional earmarks, limited tax benefits, or limited
tariff benefits as defined in clause 9(e), 9(f), or 9(g) of rule XXI of
the Rules of the House of Representatives.
XIII. FEDERAL MANDATES STATEMENT
The Committee adopts as its own the estimate of Federal man-
dates prepared by the Director of the Congressional Budget Office
pursuant to section 423 of the Unfunded Mandates Reform Act.
XIV. FEDERAL ADVISORY COMMITTEE STATEMENT
No advisory committees within the meaning of section 5(b) of the
Federal Advisory Committee Act were created by this legislation.
XV. APPLICABILITY TO LEGISLATIVE BRANCH
The Committee finds that the legislation does not relate to the
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terms and conditions of employment or access to public services or
accommodations within the meaning of section 102(b)(3) of the Con-
gressional Accountability Act.
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XVI. STATEMENT OF CONSTITUTIONAL AUTHORITY
Pursuant to clause 7 of rule XII of the Rules of the House, the
Committee finds that the authority for this legislation in Art. I, § 8,
cl.1 of the Constitution of the United States.
XVII. CHANGES IN EXISTING LAW MADE BY THE BILL, AS REPORTED
In compliance with clause 3(e) of rule XIII of the Rules of the
House of Representatives, changes in existing law made by the bill,
as reported, are shown as follows (existing law proposed to be omit-
ted is enclosed in black brackets, new matter is printed in italics,
and existing law in which no change is proposed is shown in
roman):
CHANGES IN EXISTING LAW MADE BY THE BILL, AS REPORTED
In compliance with clause 3(e) of rule XIII of the Rules of the
House of Representatives, changes in existing law made by the bill,
as reported, are shown as follows (existing law proposed to be omit-
ted is enclosed in black brackets, new matter is printed in italics,
and existing law in which no change is proposed is shown in
roman):
SMALL BUSINESS ACT
* * * * * * *
SEC. 26. OFFICE OF RURAL AFFAIRS.
(a) There is hereby established in the Small Business Adminis-
tration an Office of Rural Affairs (hereafter in this section referred
to as the ‘‘Office’’).
(b) The Office shall be headed by a director who shall be ap-
pointed by the Administrator not later than 90 days after the date
of the enactment of this section.
(c) The Office shall—
(1) strive to achieve an equitable distribution of the financial
assistance available from the Administration for small busi-
ness concerns located in rural areas;
(2) to the extent practicable, compile annual statistics on
rural areas, including statistics concerning the population, pov-
erty, job creation and retention, unemployment, business fail-
ures, and business startups;
(3) provide information to industries, organizations, and
State and local governments concerning the assistance avail-
able to rural small business concerns through the Administra-
tion and through other Federal departments and agencies;
(4) provide information to industries, organizations, edu-
cational institutions, and State and local governments con-
cerning programs administered by private organizations, edu-
cational institutions, and Federal, State, and local govern-
ments which improve the economic opportunities of rural citi-
zens; and
(5) work with the øUnited States Tourism and Travel Ad-
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ministration¿ National Travel and Tourism Office of the De-
partment of Commerce to assist small businesses in rural areas
with tourism promotion and development.
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(d) REPORTS.—
(1) INITIAL REPORT.—Not later than 90 days after the date of
the enactment of this subsection, the Administrator shall make
available on a website of the Administration, and submit to the
Committee on Small Business of the House of Representatives
and the Committee on Small Business and Entrepreneurship of
the Senate, a report on the activities of the Office during the
year preceding the date of the report that includes the following
elements:
(A) How the Office is promoting financial assistance pur-
suant to subsection (c)(1).
(B) Annual statistics compiled pursuant to subsection
(c)(2).
(C) How the Office is providing information pursuant to
subsection (c)(3).
(D) How the Office is providing information pursuant to
subsection (c)(4).
(E) The number of outreach events conducted by the Of-
fice to provide information described in paragraphs (3) and
(4) of subsection (c).
(F) Details of any partnerships that the Office engaged in
to provide the outreach described in paragraph (5), includ-
ing any partnerships with the National Travel and Tour-
ism Office of the Department of Commerce.
(G) The name of the director of the Office and the number
of staff employed by the Office.
(2) ANNUAL REPORT.—The Administrator shall annually sub-
mit, along with the budget the budget justification materials
submitted in support of the Small Business Administration
budget for a fiscal year (as submitted with the budget of the
President under section 1105(a) of title 31), a report that in-
cludes the elements described in paragraph (1).
* * * * * * *
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XVIII. MINORITY VIEWS
Small businesses are powerful drivers of economic growth across
the United States, employing 46 percent of the U.S. workforce and
generating two-thirds of new jobs. In rural areas, self-employment
tends to be higher than in urban and suburban areas. However,
rural small businesses face greater challenges, including access to
affordable capital, unreliable internet access, and labor shortages.
The Small Business Administration (SBA) Office of Rural Affairs
(the Office) can play a key role in helping rural small businesses
overcome these challenges. The Office was created in 1990 to pro-
vide information and assistance to rural small businesses. The re-
sponsibilities of the Office include compiling statistics on rural
areas and small business concerns, distributing SBA financial as-
sistance programs equitably, providing information to stakeholders,
and working with the National Travel and Tourism Office to assist
small businesses in rural areas. Unfortunately, the Office has ei-
ther been dormant or the collateral duty of a Regional Adminis-
trator for a vast majority of the time since its establishment.
In the 116th and 117th Congresses, the Committee ensured nu-
merous hearings were held to assess the state of economy in rural
America. On July 13, 2021, Representative Jared Golden, (D ME),
the Chairman of the Subcommittee on Underserved, Agricultural,
and Rural Business Development, held a hearing entitled, the
Rural American Recovery: The Role of Small Businesses and Entre-
preneurship. At that hearing, Mr. Golden said that most of the
rural small businesses owners in his district did not know much
about SBA services, such as the Small Business Development Cen-
ters or SCORE, and he sought feedback from witnesses on how to
strengthen the Office of Rural Affairs in order to support rural
businesses.
Moreover, Committee Democrats discussed concerns with Admin-
istrator Linda McMahon and urged the Administration to stand up
the Office. Committee Democrats were encouraged that the pre-
vious Administration hired additional staff in 2020 through fund-
ing from the CARES Act. The Office of Rural Affairs is also a pri-
ority for the current Administration, and in 2021, the SBA ap-
pointed a permanent, full-time career deputy director to stand up
the Office and recently named a director to lead the office.
H.R. 5265 would require the SBA to (1) issue an annual perform-
ance report, as well as a specific budget justification for the Office
of Rural Affairs, and (2) issue a report on the Memorandum of Un-
derstanding with the Department of Agriculture, which expired on
April 4, 2023.
While Committee Democrats support the ‘‘Small Business Ad-
ministration Rural Performance Report Act,’’ we remain concerned
with the statutory requirement for SBA to issue a report on the
Memorandum of Understanding with the Department of Agri-
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(10)
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culture, which expired on April 4, 2023. Committee Democrats be-
lieve the information could be obtained faster by either placing a
formal request for a briefing or sending a letter to the Adminis-
trator.
Sincerely,
NYDIA M. VELÁZQUEZ,
Ranking Member.
Æ
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