Main Street Parity Act

Bill Summary: Main Street Parity Act (H.R. 5763)

Overview

The Main Street Parity Act (H.R. 5763) is a legislative effort to reduce the financial barriers for small business owners seeking long-term financing for "special purpose" properties. The bill amends the Small Business Investment Act of 1958 to eliminate an additional equity requirement previously imposed on businesses that operate out of specialized facilities.

Purpose and Intent

The primary goal of this bill is to bring "parity" to the Small Business Administration's (SBA) 504 loan program.

Currently, the SBA 504 loan program provides fixed-rate financing for fixed assets (land, buildings, and machinery). While most small business owners are required to contribute 10% of the total project cost as equity, those utilizing "limited or single purpose properties" (special purpose properties) are required to provide an additional 5%, bringing their total requirement to 15% (or up to 20% in certain combined scenarios).

The legislation argues that this extra requirement is based on a 30-year-old assumption that specialized buildings are riskier because they are harder to repurpose if sold. However, recent data indicates that these properties perform as well as, or better than, standard properties, with some industries reporting a 0% charge-off rate.

Key Provisions

• Elimination of the "Special Purpose" Penalty: The bill removes the statutory language in the Small Business Investment Act of 1958 that mandates the additional 5% equity contribution for the construction of limited or single-purpose buildings.
• Standardization of Equity: By striking these clauses, the bill ensures that borrowers of specialized properties are subject to the same baseline equity requirements as any other small business borrower under the 504 loan program.

Who is Affected?

The bill specifically benefits entrepreneurs and small business owners whose operations require specialized facilities, such as:
* Healthcare & Wellness: Nursing homes and hospitals.
* Recreation & Leisure: Bowling alleys and amusement parks.
* Specialized Services: Car washes, marinas, and cemeteries.
* Agriculture: Dairy farms.

By lowering the required upfront cash (equity) from 15% to 10%, the act reduces the initial capital burden on these business owners, making it easier for them to acquire or expand their facilities.

Procedural Status and Timeline

• Introduced: October 14, 2025.
• Committee Action: Reported favorably by the House Committee on Small Business on November 18, 2025, with a unanimous vote (27-0).
• House Passage: Passed the House of Representatives on January 20, 2026, with overwhelming support (383-8).
• Current Status: As of January 26, 2026, the bill has been received in the Senate and referred to the Committee on Small Business and Entrepreneurship.