Comment on FR Doc # 2011-31658

As a licensed SBIC in the debenture program, I am concerned that forming an Early Stage SBIC program will increase the cost to all SBICs receiving SBA debentures. As noted in the proposed legislation, Early Stage investments are inherently more risky than the investments made by SBICs that participate in the current debenture program. The preamble to the regulation notes that Early Stage SBICs will have less capital than existing debenture program participants. This seems to be a way of rationalizing a subsidy from the later stage SBICs currently in the program in favor of new Early Stage SBICs. If this is the case, I strongly object as a private institution with long term private commitments to be required after our formation to subsidize the new Early Stage SBICs. If the existing SBICs will not be subsidizing Early Stage SBICs, what mechanisms are being proposed to charge Early Stage SBICs for losses that they incurr?