U.S. Rep. Andre Carson, D-Indianapolis, wants to help startups compete for federal contracts and obtain access to loans.
He introduced on June 17 the Emerging Business Encouragement Act, a new designation under the Small Business Administration aimed at firms in existence for five years or less. The designation would also be based on the company’s size and total compensation for managers.
Carson’s bill defines an EBE as a company with 10 percent or less the size of the current SBA designation for a small business, which is typically capped at 500 employees.
The bill would require federal agencies to set contracting goals for EBEs of at least 5 percent of contracts and subcontracts. Also, federal loan guaranty authority for SBA loans would increase from 50 percent for all small businesses to 65 percent for EBEs, providing a significant incentive for lenders to lend to these businesses.