The Honorable William Keating
United States House of Representatives
315 Cannon House Office Building
Washington, DC 20515

Dear Rep. Keating:

I am writing to express the support of the National Small Business Association for the
AGREE Act (H.R. 3476) introduced by you on November 18, 2011. This legislation
would make significant steps toward reducing the cost of capital for small businesses.
Two of the provisions are of particular importance to our members.

Section 179 allows a small business to deduct up front rather than depreciate the cost of
equipment such as computers, vehicles, machines used in manufacturing, office furniture
and the like. It substantially reduces the tax bias against investment by small firms.
Section 179 expensing is of vital importance for smaller firms, particularly those in more
capital intensive industries. By extending section 179’s current $500,000 limit through
2014, your legislation would have a dramatic positive impact on the ability of small firms
to make the investments needed for job creation, productivity growth and profitability. In
the absence of legislation, the limit falls to $125,000 in 2012. Thereafter, unless Congress
acts, the amount deductible will fall to $25,000. This latter limitation would dramatically
limit the number of firms that can appreciably benefit and dramatically reduce the
positive economic effect of the provision. Retaining the current $500,000 threshold is of
vital importance to the economy and to small businesses.

Exempting new issuers with revenues under $250 million from the application of section
404(b) of the Sarbanes-Oxley Act of 2002 for five years is a very positive step. These
internal control reporting and assessment requirements are extremely burdensome and of
extremely limited utility in small capitalization companies.

Thank you for working on these important small business issues.

Sincerely,

Todd McCracken

Celebrating 75 Years · 1937 - 2012
1156 15th Street NW · Suite 1100 · Washington, DC 20005 · 202-293-8830 · Fax: 202-872-8543 · www.nsba.biz