Yesterday, Congressman Al Green (TX-09) joined President Barack Obama at a White House ceremony to enact into law the Small Business Jobs and Credit Act, which Congress passed last week. Congressman Green was one of the select members of Congress invited to witness the President sign this landmark bill, which aims at continuing the economic recovery in our nation.
As a member of the Financial Services Committee, Congressman Green played a role in the development of this legislation, which the House of Representatives passed by a vote of 237 to 187 last Thursday, sending it to the President's desk.
With projections estimating the creation of as many as 500,000 jobs, the bill encourages community banks to increase lending to small businesses through a $30 billion fund which will be run by the Treasury Department. Guided by performance-based standards, this fund will deliver affordable capital to banks with $10 billion or less in assets.
"Hiring by small businesses has diminished since the second half of 2008, which hurts the American economy, due in part to a decrease in lending by banks. These companies are a key driver of job growth in the United States. This legislation is going to reverse our current course and open the lines of credit moving our economy forward, instead of stalling it. Having created two thirds of the new jobs over the last 15 years, the small businesses sector is one of the principal engines of our economy and these funds will decisively contribute to its growth," commented Congressman Green.
As requested by the Congressman while the bill was being negotiated, the new legislation requires that the websites of the participating institutions clearly state they cannot discriminate on the basis of factors prohibited under the Equal Credit Opportunity Act.
Another amendment sponsored by Congressman Green, along with members Mike Honda, Andre Carson and Judy Chu, establishes that minority-owned financial institutions can be considered for funding by the Treasury Department. Furthermore, the amendment requires the inclusion of linguistically and culturally appropriate outreach materials for the campaigns to inform about these new loan opportunities.
The new legislation also provides tax breaks worth $12 billion to encourage investment, new starts and hiring by raising the amount that a small business can spend in capital expenditures, as well as by doubling to $10,000 the tax deduction for startup expenditures for entrepreneurs looking to launch a new venture. Additionally, self-employed taxpayers will be allowed to deduct health costs for payroll tax purposes.
Congressman Green also noted that the new legislation provides $1.5 billion in grants to state lending programs that, in turn, support loans to small businesses. "This creates an incentive for state governments to remain involved with these programs, which is necessary for the success of the recovery because they can complement the work of the federal government," indicated Congressman Green.
"The bottom line is that this legislation will improve access to capital and cut taxes for America's small businesses, as well as for entrepreneurs. They will now have at their disposal easier ways to innovate, grow and hire, which will make this legislation an additional resource to lead the economic recovery in our nation," concluded Congressman Green.
The bill is supported by the National Small Business Association, the National Retail Federation and the National Association for the Self-Employed, among others.