Congressman Brian Baird (WA-03) today voted to create jobs and grow the economy by voting in support of the Small Business Lending Fund Act of 2010 (H.R. 5297). The House today passed H.R. 5297, which will encourage small and community banks to lend to small businesses who have been struggling to get credit during the financial crisis.
"What small business owners need right now is access to capital," said Congressman Baird. "There are businesses in our community that have survived the recession, but need help getting credit to be able to compete. We need community banks to be partners in helping small businesses succeed. This bill gives community banks some great incentives to loosen up credit for local businesses."
The Small Business Lending Fund Act creates a new $30 billion lending fund for small and medium sized community banks (assets of $10 billion or less), who would then be able to leverage $300 billion in small business lending. With banks expected to pay back the funds over 10 years with interest, the Congressional Budget Office (CBO) estimates H.R. 5297 will save taxpayers $1 billion over 10 years.
Banks with less than $1 billion in assets would be eligible to borrow an amount equal to 5% of its assets. Banks worth up to $10 billion in assets would be able to borrow up to 3% of their assets. Banks would pay back the government loan at a dividend rate starting at 5%, but would get lower interest payments if they increased small business lending.
Congressman Baird also voted in favor of the Small Business Jobs Tax Relief Act (H.R. 5486), which the House passed on Tuesday, which will help create jobs across the country by offering tax incentives to help small businesses grow. Both bills are now before the Senate.
As the son of small business owners, Congressman Baird knows first-hand that small businesses are vital to putting people to work and reviving the economy. Most recently, Congressman Baird hosted a small business workshop with the Small Business Administration (SBA) and other government agencies in Vancouver to give local companies insight into securing SBA loans and government contracts. More than 50 local businesses attended the May 14th event.