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Small Business Credit Availability Act

Floor Speech

By:
Date:
Location: Washington, DC

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Mr. COSTA. Madam Speaker, I rise today in support of H.R. 3336, the Small Business Credit Availability Act.

This bipartisan measure received unanimous support in the House Committee on Agriculture and ensures, as the previous speakers have indicated, that small financial entities such as community banks, farm credit system institutions, and credit unions will not be burdened with costly regulations resulting from the reform of our financial system. That was never Congress' intent.

I appreciate very much the work of Chairman Lucas and Ranking Member Peterson and their staffs, as well as the bill's sponsor, Representative Hartzler, to reach an agreement with not only myself, but my colleagues, Congressmen Baca and Cardoza, who are also on the committee, as well as the California delegation on the underlying text of this bill. Without your support, obviously we could not address this issue pertaining to California.

While we work to maintain the viability of small businesses recognized in H.R. 3336, we also must look for ways to avoid unintended consequences resulting from the implementation of the Dodd-Frank Act on other entities, in this case, such as utilities.

It's always the difficult challenge we have in Congress, the law of unintended consequences, that we must respond to.

Because of California's regulatory environment, I expressed concerns in the committee that California's energy providers, our utility companies, might be or would be inadvertently, as we believe, swept up by the ``swap dealer'' definition, which is the efforts that the committee has addressed. Over several weeks, we worked together with the staff and the utilities to develop language that provides the clarity needed to ensure that companies within California that provide energy for all businesses and residences--which are ultimately California's ratepayers--are not penalized by the Federal regulators for simply complying with State law.

H.R. 3336 includes language clarifying that the actions undertaken to comply with State or local laws or regulations are excluded in determining whether or not an entity is considered a swap dealer. Let me be specific. The language clarifies that resource adequacy contracts entered into to satisfy California's Public Utilities Commission procurement requirements, renewable energy credits used to satisfy the California Renewable Portfolio Standard, and emission allowances to satisfy California's greenhouse regulations should not--and this is the key line--should not be considered in determining whether or not an entity is a swap dealer.

My colleagues, we should understand that the situation we're dealing with in these examples, these transactions, are closely regulated by California's Public Utilities Commission or the California Air Resources Board, and they pose no systemic risk to our financial systems or to the ratepayers.

While California is currently affected, it is possible that these concerns could be shared by energy providers in other States. That's why the committee, in their wisdom, chose to address this issue to help not only California, but possibly to extend to other States that might be similarly affected. For these reasons, I encourage my colleagues to support this bill.

I once again want to thank the chairman, thank Ranking Member Peterson, Chairman Lucas, and the author of the bill, Representative Hartzler.

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