WASHINGTON — United States Senate Committee on Small Business and Entrepreneurship chair Mary Landrieu, D-La., and Ranking Member Olympia Snowe, R-Maine, have introduced legislation designed to increase access to capital for small businesses and help create jobs.
S. 2869, the “Small Business Job Creation and Access to Capital Act of 2009,” would increase the small-business loan limit to as high as $5.5 million and extend for a year the elimination of fees and increased guarantees set to expire under the Recovery Act.
“Now that we have stabilized Wall Street, it is time to jumpstart Main Street, and that begins with implementing the vital provisions within this bill,” says Landrieu. “The loan limit increase could boost SBA [Small Business Administration] lending by $5 billion next year alone, while the refinancing component of the bill could help save 60,000 jobs. To ensure small businesses are able to grow and continue being the job creators they have historically been, we must make these needed changes.”
“The critical initiatives chair Landrieu and I are introducing today are long overdue, and will give our nation’s entrepreneurs a greater ability to succeed and prosper,” says Snowe. “I have introduced legislation in both the 110th and 111th Congresses to raise the maximum size limits for SBA-backed loans, and this crucial step will give small business-owners across the country an improved opportunity to grow their firms.
“Additionally, by extending the authorization to temporarily provide higher loan guarantees and eliminate fees for borrowers, we are continuing our efforts to build upon what has worked well in the American Recovery and Reinvestment Act.”
The Recovery Act provided $375 million to increase the guarantee on small-business loans and eliminate the fees charged to borrowers, but this money is almost completely spent. The SBA has created a waiting list for awarding the last dollars (click here for our previous coverage).
The Small Business Job Creation and Access to Capital Act of 2009 would increase the loan limit on 7(a) loans from $2 million to $5 million; increase the loan limit on 504 loans from $1.5 million to $5.5 million; increase the loan limit on microloans from $35,000 to $50,000 and increase the maximum loan made to a microloan intermediary from $3.5 million to $5 million; allow the 504 loan program to refinance short-term commercial real estate debt into long-term, fixed-rate loans; extend the authorization to provide 90% guarantees on 7(a) loans and fee elimination for borrowers on 7(a) and 504 loans through December 31, 2010; and direct the SBA to create a website where small businesses can identify lenders in their communities.