Summary of HR 8063 — SPARK Act (Strengthening Place-based Access, Resources, and Knowledge)

Jurisdiction: United States, 119th Congress
Introduced: March 24, 2026 by Rep. Ayanna Pressley (co-sponsor)

Purpose
- The SPARK Act seeks to amend the Small Business Act to spur entrepreneurial ecosystems in underserved communities, particularly in rural and economically distressed areas, by expanding access to capital, mentorship, and tailored support through place-based programs.

Key Provisions and Changes

1) SPARK Program (Section 49, re-designated as Section 51)
- Establishes a new SPARK Program within the Small Business Act to fund and support eligible entities that operate accelerators, incubators, and other entrepreneurship-focused initiatives.
- Definitions:
- Accelerator: an organization that mentors and prepares startups for scaling and investment, possibly providing seed investment in exchange for limited equity.
- Incubator: supports startups with mentorship and shared resources (e.g., co-working space) for a defined period.
- Eligible Entity: includes accelerators, incubators, and other small business innovation-focused projects, with eligibility extended to various entities such as 501(c)(3) organizations, CDFIs, MDIs, Community Advantage lenders, HEA-related institutions, junior/community colleges, etc.
- Federally Recognized Areas of Economic Distress: includes HUBZones, empowerment zones, Promise Zones, CRA-designated areas, and disaster-designated areas meeting specific timing criteria.
- Program Operation:
- The Administrator must establish and administer a cooperative agreement program with eligible entities to run 5-year projects benefiting startup, newly established, or growing small businesses.
- Projects must be location-accessible, have a full-time staff, and include joint program delivery with the SBA, including one-on-one counseling and a structured mentorship program.
- Programs must focus on underserved groups (women, socially/economically disadvantaged individuals, veterans, rural entrepreneurs, Native communities, formerly incarcerated individuals, etc.) and prohibit charging fees for participation.
- Eligible entities must regularly upgrade services to meet evolving needs and coordinate with investment/lending partners, NGOs, and government programs.
- Funding and Renewal:
- Cooperative agreements are renewable for additional 3-year terms; renewal decisions are based on established criteria (impact, structure, local partnerships) and competitive scoring.
- Annual funding is subject to appropriations; no suspension/termination without due process.
- Reporting and Oversight:
- Annual program and financial examinations of each project; require detailed reporting on expenditures, non-Federal funding, participant outcomes, and other metrics.
- Public disclosure of criteria and project information; annual Congressional reporting on participants (demographics, employment, wages, capital raised, retention, etc.).
- Privacy and Regulations:
- Privacy protections for participants; regulations to govern disclosures during audits; clawback provisions for fraud.

2) SPARK Financing Program (Section 50)
- Establishes a grant and loan program to complement SPARK, enabling covered entities to provide grants and loans to covered small business concerns.
- Covered Entities and Grants/Loans:
- If an entity has a SPARK cooperative agreement, it can receive up to $1,000,000 per year in SPARK Financing assistance; eligible to receive such funding concurrently with their SPARK cooperative agreement.
- If no SPARK cooperative agreement, funding is capped at $500,000 per year.
- Uses of Funds:
- Grants to cover project objectives aligned with SPARK goals (with per-grant limits of $20,000).
- Loans with favorable terms to help bridge financing gaps, reduce collateral barriers, lower interest, or lower required equity, and to attract more lenders to underserved areas.
- No fees or compensation required from grant/loan recipients to the sponsoring entity.
- Verification and Accountability:
- Entities must verify the legitimacy of recipients and provide detailed information on use, finances, and outcomes.
- Programs subject to examination, with metrics for success, default, and failure rates; performance data feed into continued funding decisions.
- Reporting and Oversight:
- Similar annual reporting requirements as SPARK, including participant demographics, jobs created, wages, and capital access metrics.

3) Regulations (Section 6)
- Within one year of enactment, the SBA must promulgate regulations implementing Sections 49 and 50, including fraud clawback mechanisms and program oversight procedures.

Who Is Affected
- Eligible entities operating accelerators, incubators, and related initiatives.
- Underserved small business concerns, including minority-owned, women-owned, rural, socially/economically disadvantaged, veterans, individuals with disabilities, and those in federally recognized areas of economic distress.
- Federal, state, and local entities coordinating with SBA, as well as lenders and investment partners.

Timeline Highlights
- Program establishment and initial cooperative agreements: within 1 year of enactment.
- First-year and subsequent annual reporting to Congress.
- Regulatory framework to be issued within 1 year of enactment.
- Ongoing 5-year project cycles with potential 3-year renewals.

Impact Considerations
- Aims to expand access to capital and mentorship in high-need areas.
- Seeks to increase startup survival, job creation, and workforce development in underserved communities.
- Emphasizes place-based, community-driven approaches and strong coordination with existing small business ecosystem partners.