Sponsors (8)
The bill expands small businesses' access to private capital by allowing SBICs to count more funds as excluded for leverage purposes, but it increases financial risk borne by investors and potential exposure for taxpayers and government budgets.
Small business owners: can access more private capital because SBICs may count more non‑capital funds as excluded when raising leverage, potentially increasing available financing for small firms.
Taxpayers and government budgets: could face greater exposure to losses if higher SBA‑backed leverage increases the likelihood or size of SBIC failures that the government ultimately backs or absorbs.
Investors in SBICs and financial institutions: may face higher risk of loss because allowing more leverage for firms with less private capital raises the potential for greater investment volatility or default.
Based on analysis of 2 sections of legislative text.
Excludes most government funds from SBIC 'capital' and raises/refines leverage‑exclusion thresholds, caps, and calculation rules to expand allowable exclusions.
Introduced December 3, 2025 by John Wright Hickenlooper · Last progress December 3, 2025
Revises rules that define which funds count as “capital” for Small Business Investment Companies (SBICs) and raises limits on how much non-private funding SBIC licensees can exclude when applying for federal leverage. The changes carve most federal, state, and local government funds out of capital, increase per-company and commonly-controlled exclusion caps for certain licensees, allow exclusions for investments in specific types of small businesses (rural, low-income area, covered technology, and small manufacturers), and add detailed calculation rules including a prospective-only rule and a per-company aggregate exclusion cap.