House Passes Bill to Improve Small Business Access to Capital

Press Release

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 Administration’s (SBA) successful 7(a) and Certified Development Company (CDC) loan programs, passed the House by a vote of 380 to 45.

“Our economy is dependent upon the ability of small business owners and entrepreneurs to access the capital they need to start or expand their businesses,” said Congressman Chabot, the Committee’s Ranking Member and a sponsor of the legislation. “This bipartisan legislation will continue to enable the SBA’s primary lending program to operate without subsidy â€" and that’s important. Should tax dollars be appropriated, the bill requires the funds be used to reduce borrower fees.”

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 “historic”. Chabot said the legislation could serve Cincinnati’s 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 “it’s paid for by those who use it.”

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.

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