Accelerating Access to Capital Act of 2016

Floor Speech

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Mrs. WAGNER. Mr. Chair, I thank the chairman of the Financial Services Committee.

I am proud to sponsor the Accelerating Access to Capital Act, H.R. 2357. I would also like to thank and congratulate my colleagues, Representative Emmer and Chairman Garrett, for their legislation as well.

Regulatory burden is one of the reasons why we are still in the slowest recovery of our lifetime since the financial crisis. Small businesses are finding it more and more difficult to find financing in order to grow and expand their business.

Dodd-Frank has made traditional bank lending for small businesses more scarce. Smaller companies that wish to go to the capital markets are finding compliance and regulatory requirements too extensive and far too costly.

This legislation builds upon other efforts by this committee to provide simplified disclosure and reduce burdens for smaller companies in order to lower the cost of raising capital.

Specifically, this would extend to smaller reporting companies the ability to utilize Form S-3, a much more simplified registration for companies that have already met prior reporting requirements with the SEC. Allowing small companies to use this form would provide significant benefits with its shorter length, allowing forward incorporation by reference and the ability to offer securities off the shelf, which are all things that larger companies are currently able to enjoy.

Streamlining disclosure will lower compliance costs associated with filing redundant paperwork, which will in turn allow companies to direct more resources to growing their business. Fuel Performance Solutions, which is a fantastic company based in my hometown of St. Louis, has spent the last 10 years working on exciting fuel products that could potentially save Americans money at the pump and reduce harmful emissions.

In order to fund this research in breakthrough technology, Fuel Performance Solutions eventually decided to register with the SEC and go public to raise more capital and expand their business.

The company conducted a study, Mr. Chair, and found that, instead of filling out a 100-page registration form which takes about 4 to 6 weeks to complete, this legislation would allow them to fill out a 20-page form which only takes 2 days to complete. As a result, they would have incurred less legal fees, less accounting, and less investment banking fees and saved close to $225,000.

Additionally, under this job growth legislation, they could have received SEC approval in days, rather than months, and thereby obtain certainty in regard to funding their business.

I am proud that the greater Metropolitan St. Louis region is the fastest growing startup scene in the country. But we must provide opportunities for these businesses and many others to grow and drive and thrive in the marketplace.

Extending these cost-saving provisions to smaller companies that large companies are currently able to enjoy is absolutely critical and can make the difference in their ability to issue an additional offering, expand their business, and create more jobs. The Accelerating Access to Capital Act will do just that.

I urge the passage of this legislation.

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