Investing in All of America Act of 2025
The Investing in All of America Act of 2025 amends the Small Business Investment Act of 1958 to expand and clarify when certain investments made by Small Business Investment Companies (SBICs) can be excluded from the leverage limit used to measure how much debt an SBIC can issue to back its investments. The bill creates and broadens categories for which investments can be excluded from the outstanding leverage calculation, notably investments in small businesses located in rural or low‑income areas and in small businesses operating in critical technology areas (including small manufacturers). It also adds annual, CPI‑based adjustments to the dollar amounts involved and includes a prospective (not retroactive) applicability rule. In short, the bill aims to unlock more leverage capacity for SBICs to fund targeted rural, low‑income, and technology-focused small businesses. Key design features include explicit definitions of the eligible target areas and industries, a cap on how much may be excluded from leverage calculations, and a mechanism to adjust the relevant dollar amounts over time to keep pace with inflation. The bill also clarifies which funds count toward the leverage calculation (and which do not) and preserves the Administrator’s oversight role in approving leverage requests, while excluding certain accrual debt instruments from the CPI-adjustment rule.
Key Points
- 1Expands the categories of investments that can be excluded from the SBIC leverage calculation to include:
- 2- small business concerns in low‑income geographic areas or rural areas,
- 3- small businesses operating in critical technology areas,
- 4- small manufacturers.
- 5Changes to maximum leverage rules:
- 6- The baseline leverage cap is reduced for certain calculations (e.g., a transition from 300 to 200 in one category).
- 7- The per‑company or per‑group leverage amounts are set at approximately $175 million for certain companies, with alternative provisions for others, and a commonly controlled group may have up to $350 million (subject to adjustments).
- 8Limitation on the exclusion:
- 9- The total amount excluded from the outstanding leverage calculation under the new categories may not exceed the lesser of 50 percent of the company’s private capital or $125 million.
- 10Prospective applicability:
- 11- An investment must be made after enactment to qualify for the exclusion under the new categories.
- 12Annual adjustment (CPI indexing):
- 13- The dollar amounts described in the exclusion categories are to be adjusted each year for inflation, starting at enactment and continuing annually. There is an exception for SBICs that issue accrual debentures.
- 14Definitions and scope:
- 15- Targets include: low‑income geographic areas, rural areas, covered technology categories (as defined in the U.S. Code), and small manufacturers (as defined by the SBIA).
- 16- “Covered technology category” aligns with a technology focus used in defense/technology policy, and “small manufacturer” has a specific statutory definition.
- 17Government funds treatment:
- 18- The bill clarifies that funds obtained from government sources are generally not included in the exclusion, with specific enumerated exceptions tied to the defined subcategories for leverage approval.