H.R. 3323 would increase the annual revenue threshold the Securities and Exchange Commission (SEC) uses to classify issuers of new securities as emerging growth companies from $1 billion to $3 billion. The bill also would extend the period that an issuer can be classified as an emerging growth company after its initial public offering from 5 years to 10 years.
Using information about the cost of similar provisions, CBO estimates that implementing H.R. 3323 would cost less than $500,000 over the 2026-2030 period. Because the SEC is authorized to collect fees each year to offset its annual appropriation, CBO expects that the net effect on discretionary spending over the same period would be negligible, assuming appropriation actions consistent with that authority.
If the SEC increases fees to offset the costs associated with implementing provisions of H.R. 3323, it would increase the costs of an existing private-sector mandate on entities required to pay those fees. CBO estimates that the incremental cost of the mandate would be small and would fall well below the annual threshold established in the Unfunded Mandates Reform Act (UMRA) for private-sector mandates ($206 million in 2025, adjusted annually for inflation).
H.R. 3323 contains no intergovernmental mandates as defined in UMRA.
The CBO staff contacts for this estimate are Zunara Naeem (for federal costs) and Rachel Austin (for mandates). The estimate was reviewed by H. Samuel Papenfuss, Deputy Director of Budget Analysis.
