House Passes Bill to Improve Small Business Access to Capital
The House of Representatives today passed bipartisan legislation to reduce lending fees and increase access to capital for small businesses. The Small Business Lending Improvements Act, H.R. 1332, a bill to improve and strengthen the Small Business Administrationâs (SBA) successful 7(a) and Certified Development Company (CDC) loan programs, passed the House by a vote of 380 to 45.
âOur economy is dependent upon the ability of small business owners and entrepreneurs to access the capital they need to start or expand their businesses,â said Congressman Chabot, the Committeeâs Ranking Member and a sponsor of the legislation. âThis bipartisan legislation will continue to enable the SBAâs primary lending program to operate without subsidy â" and thatâs important. Should tax dollars be appropriated, the bill requires the funds be used to reduce borrower fees.â
The Small Business Committee held two hearings related to the legislation and loan programs â" one in Washington, DC and one in Cincinnati. David Main, President of the Cincinnati based Hamilton County Development Company, testified at both hearings calling the bill âhistoricâ. Chabot said the legislation could serve Cincinnatiâs small businesses and help spur community redevelopment efforts.
Specifically, the Small Business Lending Improvements Act authorizes lower fees to small business borrowers only to the extent that an appropriation exists. The legislation allows the SBA 7(a) Loan Program itself to continue to operate without the use of appropriations, which Chabot said was the most desirable way to fund the program since âitâs paid for by those who use it.â
The bill also reestablishes the SBA Low-Doc loan program for rural areas, makes the Community Express Program for low and moderate-income individuals permanent, and codifies existing regulatory requirements on the establishment and oversight of certified development companies, as well as require CDCs to liquidate their own loans.