Pre-election political update: Changing Committee Landscape

With only a few weeks until the 2024 election, the political landscape is poised to change in a big way. Regardless of what happens at the top of the ticket, the House and Senate will see a large turnover. Let’s take a look at the most critical committees to ACA’s policy issues and how the election could shake things up.

House Small Business Committee

At this point, the House is a virtual toss up as to whether the Republicans will retain control, or the Democrats will come out on top. Currently, Rep. Roger Williams (R-TX) is the chairman of the committee. Rep. Williams is a small business owner himself, running his family-owned car dealership and calf-cow operation, and has brought his real-world experience into his first term as committee chair. He is focused on helping businesses recover from the COVID-19 lockdowns, lowering taxes, and holding the SBA accountable.  One of the committee’s main priorities is holding the SBA accountable by making sure its programs are utilized correctly and do not waste taxpayer money. The committee recently held a hearing with SBA Administrator Isabel Guzman, where Rep. Williams asked the SBA to provide more transparency for many of its programs. A Republican led committee going into 2025 would also likely help Congress extend Trump-era tax cuts, which expire at the end of 2025. The Tax Cuts and Jobs Act of 2017 allowed some business owners to deduct up to 20% of qualified business income, known as the 199(a) deduction. Taxes on new equipment purchases and other qualified assets were also temporarily cut. Small businesses benefit from the temporary income deductions for sole proprietorships, partnerships, and S-corporations. A Republican led Small Business Committee would likely help Congress pass a similar new tax package. 

If Democrats win back the House majority, current Ranking Member Nydia Valezquez (D-NY) would likely assume the committee’s top position. Under her leadership, the committee would ensure the SBA keeps its funding, streamline federal regulations for small businesses, implement comprehensive tax reforms for small businesses, creating small business friendly trade policies, investing in STEM education and workforce training, and helping underserved business owners. The committee would help Congress create US jobs, protect workers’ rights, and pursue fair trade strategies to help open markets that ensure a level playing field for American workers and businesses.  Democrats will ensure that the SBA has proper funding to run programs that increase the availability of seed capital for start-ups, can give loans for maturing companies, and provide business training to new entrepreneurs. Democrats would also help small businesses win federal contracts by ending the practice of mega contracts that disadvantage small businesses. 

Senate Small Business Committee

Currently, Sen. Jeanne Shaheen (D-NH) is the Chair of the Senate Small Business and Entrepreneurship Committee. Sen. Shaheen is a former small business owner and advocates for getting small businesses the resources they need. She introduced the 504 Loan Availability Act to eliminate the annual disruptions in SBA CDC/504 loan availability at the end of each fiscal year. She created the State Trade Expansion Program (STEP), which boosted exports from American small businesses and helped them enter the international marketplace. Through the committee, she wants to help more small business access capital through increased SBA lending, address workforce development challenges so workers have the right skills and training, and expand federal contracting opportunity for small businesses. Recently, the committee was able to secure the inclusion of some of its priorities into the FY 2025 National Defense Authorization Act. This included modernizing the STEP, accountability for subcontractor utilization, and increased sole source thresholds for all small business set-aside programs. Sen. Shaheen’s priorities for the committee include access to broadband, counseling and training for businesses, disaster assistance programs, healthcare, and minority entrepreneurs. 

Sen. Joni Ernst (R-IA) currently serves as the Ranking Member of the committee and would likely become the committee chair if the Republicans win a majority in the Senate. Sen. Ernst’s priorities for the committee include entrepreneurial development programs, regulatory reform, SBA budget and operation oversight, trade and exporting, and tax and finance policy. She has also prioritized holding the SBA accountable. She said the SBA is only creating opportunities for left-wing groups, and the SBA should not be interested in partisan politics. Sen. Ernest also recently introduced the Prove It Act, which was passed out of the committee. The bill would force federal agencies to demonstrate that any new regulation is compliant with existing laws and considers the indirect and direct costs placed on small businesses. Sen. Ernest wants to make sure any federal regulations on small businesses are proven before being implemented. This act would create a way for small businesses to raise concerns when regulators do not consider the costs incurred. It would also potentially exempt small businesses from the regulation altogether if it fails to comply with the review process. Sen. Ernest will look to increase SBA accountability if given the chance to chair the committee. 

Senate Banking Committee 

The Senate Committee on Banking, Housing, and Urban Affairs is currently chaired by Sen. Sherrod Brown (D-OH). Sen. Brown, who is currently in a very close reelection race, prioritizes ensuring the largest banks can cover their own loses without forcing taxpayers to do so, creating an even playing field for financial institutions, and removing costly burdens for small financial institutions. He has also held large wall street firms and banks accountable to make sure they protect the public from large risks and strengthen the financial system. He has also defended the Consumer Financial Protection Bureau (CFPB) from its budget being slashed to further protect consumers’ finances. 

If the Republicans win control of the Senate in November, it is highly likely that current Ranking Member Sen. Tim Scott (R-SC) will be named chairman. His priorities for the committee include reducing barriers to accessing credit, increasing financial inclusion, increasing access to capital formation, regulatory oversight, and protecting national and economic security. Recently, he introduced capital markets reform legislation to revitalize community businesses and open capital markets to all Americans. The Empowering Main Street in America Act would create more avenues for capital formation to create jobs and generate economic growth. Sen. Scott created this legislation after meeting with Black investors and founders and discussing ways to improve minority businesses’ access to capital. Sen. Scott also released a capital markets reform framework. This included making sure the SEC is focused on ensuring the US capital markets system works effectively instead of putting up new and burdensome barriers to opportunity. Sen. Scott believes that innovation not regulation spurs economic growth. He wants to increase opportunities for the average investor to build wealth and access new sources of capital. Sen. Scott has also been critical of the SEC’s current leadership.