Sen. Mary Landrieu (D-La.) and Sen. Olympia Snowe (R-Maine) Dec. 11 introduced a bill that would increase the small business loan limit to $5 million in an effort to stimulate job creation. The Small Business Job Creation and Access to Capital Act of 2009 (S. 2869) would also extend fee eliminations and increased guarantees introduced under the American Recovery and Reinvestment Act (ARRA) for one year.
ABC, along with 54 other organizations, Dec. 10 sent a letter to Congress supporting S. 2869 and urging both the U.S. House and Senate to support appropriations that would extend the Small Business Administration (SBA) loan provisions contained in ARRA.
The letter noted that although the stimulus provisions have made a significant difference, the funds are now exhausted and borrowers are on a waiting list in hopes of accessing remaining funds. The letter also urged Congress to act quickly so the SBA can regain its lending momentum.
“Access to credit remains a critical issue for small businesses today,” the letter stated. “The lack of credit availability for small businesses is slowing the recovery efforts and stalling the significant job creation potential of small business entrepreneurs.
“Small businesses cannot be the engine of our economy if they have to line up in a queue and wait to see if they can gain access to credit,” the letter continued. “Congress needs to act swiftly and restart the flow of credit to America’s job-creating small businesses or else these entrepreneurs will be left to sit on the sidelines.”
In addition to raising the maximum loan rate, the Senate bill will extend loan guarantee authorizations and eliminate fees for borrowers. S. 2869 is scheduled to be reviewed and marked up by the Senate Committee on Small Business and Entrepreneurship Dec. 17.
The U.S. House of Representatives Nov. 2 referred a similar bill, H.R. 3854, to its Committee on Small Business and Entrepreneurship. H.R. 3854 contains an increase in maximum loan size to $3 million and does not contain any increases in guarantees.
In addition, the House Dec. 16 passed the Department of Defense appropriations bill which included a provision that allocates additional funds for the SBA 7(a) loan program to extend modifications contained in the stimulus package. The provision will keep the 90 percent guarantee on small business loans and will reduce or waive the loan fees through February 2010.
To read the letter, click
here.