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House Passes SBA Artificial Intelligence Utilization Act, Mandating Annual AI Use Report
On June 30, 2026, the House of Representatives approved H.R. 8881, the SBA Artificial Intelligence Utilization Act, giving Congress a new window into how the Small Business Administration (SBA) uses artificial intelligence (AI) and machine learning (ML). The bill, introduced by Representative Brad Finstad of Minnesota’s 1st district and Representative George Latimer of New York’s 16th district, does not force the SBA to adopt AI or stifle innovation. Instead, it creates a clear, annual reporting framework that ties the agency’s technology use to congressional oversight.
The legislation requires the SBA Administrator—a cabinet‑level position—to submit a comprehensive report each year. The report will detail how AI and ML are woven into the agency’s core programs, from loan guarantees and federal contracting—where 23 % of prime contracts are earmarked for small businesses—to counseling services delivered through Small Business Development Centers, Women’s Business Centers, and SCORE chapters. By covering capital, contracts, and counseling, the bill forces the SBA to account for the full spectrum of AI integration that touches more than a million entrepreneurs annually.
Finstad, who delivered a prepared statement on the House floor, framed the bill as a “commonsense” measure. He said, “This legislation brings necessary oversight and accountability to the SBA’s use of AI without compromising transparency or trust,” and urged a YES vote. Finstad emphasized that the bill “does not mandate the use of AI or prohibit innovation in our Small Business Administration but instead ensures commonsense congressional oversight into how these tools are being used.”
The SBA’s mission—to strengthen the U.S. economy by enabling the establishment and viability of small businesses—has always hinged on efficient, fair access to capital and contracts. Its AI inventory page acknowledges that AI can accelerate growth and improve service quality, while also underscoring the need for careful oversight. The new reporting requirement dovetails with that cautionary stance by mandating that the agency track and disclose its AI initiatives.
The House Committee on Small Business, a standing committee that has overseen small‑business policy since 1941, shepherded the bill through committee and on the floor. The committee’s endorsement signals a broader congressional interest in ensuring that federal agencies employ AI responsibly. Other AI‑related bills have also surfaced during the 119th Congress, covering safety, worker protections, and export controls, but H.R. 8881 is the first to focus specifically on a federal agency that interacts with millions of small businesses each year.
The bill’s next phase involves Senate consideration and potential amendments. If the Senate passes it, the SBA will need to build an internal reporting framework and identify the metrics and data Congress will require. The agency’s existing AI inventory suggests that it already tracks many of the initiatives the bill will ask for, which may ease the transition.
By obligating an annual report, the legislation aims to give lawmakers insight into how AI is streamlining processes such as loan underwriting, contract matching, and counseling service delivery. At the same time, it keeps a check on potential risks—bias, privacy concerns, and algorithmic transparency—that could arise when large amounts of data and automated decision‑making intersect with public services.
In summary, the House’s approval of the SBA Artificial Intelligence Utilization Act establishes a formal reporting obligation for the SBA, clarifies that the agency is not mandated to adopt AI, and reinforces congressional oversight of AI use in a federal agency that serves a critical segment of the U.S. economy. The bill’s future in the Senate will determine when the SBA must begin preparing its first annual AI use report.
The legislation requires the SBA Administrator—a cabinet‑level position—to submit a comprehensive report each year. The report will detail how AI and ML are woven into the agency’s core programs, from loan guarantees and federal contracting—where 23 % of prime contracts are earmarked for small businesses—to counseling services delivered through Small Business Development Centers, Women’s Business Centers, and SCORE chapters. By covering capital, contracts, and counseling, the bill forces the SBA to account for the full spectrum of AI integration that touches more than a million entrepreneurs annually.
Finstad, who delivered a prepared statement on the House floor, framed the bill as a “commonsense” measure. He said, “This legislation brings necessary oversight and accountability to the SBA’s use of AI without compromising transparency or trust,” and urged a YES vote. Finstad emphasized that the bill “does not mandate the use of AI or prohibit innovation in our Small Business Administration but instead ensures commonsense congressional oversight into how these tools are being used.”
The SBA’s mission—to strengthen the U.S. economy by enabling the establishment and viability of small businesses—has always hinged on efficient, fair access to capital and contracts. Its AI inventory page acknowledges that AI can accelerate growth and improve service quality, while also underscoring the need for careful oversight. The new reporting requirement dovetails with that cautionary stance by mandating that the agency track and disclose its AI initiatives.
The House Committee on Small Business, a standing committee that has overseen small‑business policy since 1941, shepherded the bill through committee and on the floor. The committee’s endorsement signals a broader congressional interest in ensuring that federal agencies employ AI responsibly. Other AI‑related bills have also surfaced during the 119th Congress, covering safety, worker protections, and export controls, but H.R. 8881 is the first to focus specifically on a federal agency that interacts with millions of small businesses each year.
The bill’s next phase involves Senate consideration and potential amendments. If the Senate passes it, the SBA will need to build an internal reporting framework and identify the metrics and data Congress will require. The agency’s existing AI inventory suggests that it already tracks many of the initiatives the bill will ask for, which may ease the transition.
By obligating an annual report, the legislation aims to give lawmakers insight into how AI is streamlining processes such as loan underwriting, contract matching, and counseling service delivery. At the same time, it keeps a check on potential risks—bias, privacy concerns, and algorithmic transparency—that could arise when large amounts of data and automated decision‑making intersect with public services.
In summary, the House’s approval of the SBA Artificial Intelligence Utilization Act establishes a formal reporting obligation for the SBA, clarifies that the agency is not mandated to adopt AI, and reinforces congressional oversight of AI use in a federal agency that serves a critical segment of the U.S. economy. The bill’s future in the Senate will determine when the SBA must begin preparing its first annual AI use report.
