Small Business Jobs and Credit Act of 2010

Date: June 17, 2010
Location: Washington, DC


Small business owners are going to be enrolled automatically in a program that sets aside 6 percent of the value of an SBA guaranteed loan to pay off that loan, as it was previously described. While I appreciate very much the gentleman's effort to reduce the financial burden on small business owners, there are a number of problems with this program.

First, it forces business owners to opt out of a federally mandatory set-aside of funds. This is going to reduce the amount of capital available because disbursements of those set-aside funds will be made to a bank or to a loan servicer instead of to small businesses.

Second, by requiring an opt-out, it suggests that a Federal agency, the SBA, is better at managing the small business rather than its owner--a conclusion that I, obviously, strongly dispute.

Third, loans under the 7(a) loan program are just that. Mr. Chairman, they are loans. It seems rather absurd to have the SBA automatically set aside funds in order to pay off loans it has just approved.

Fourth, the size of loans in the program are limited to those businesses with loans of less than $300,000.

I wonder: Why are these businesses favored over small business owners who may need slightly larger amounts of capital? By making the program available for loans of less than $300,000, I guess it suggests that small business owners at that level are less credit worthy and are incapable of managing their finances as opposed to businesses requiring a little bit larger loans.

All of these points, Mr. Chairman, are points that I am making. I strongly dispute the reason for this program. For that reason, I oppose the gentleman's amendment. Again, I appreciate very much his efforts and what he is trying to do, but I can't agree with this at all.

I reserve the balance of my time.


Mr. GRAVES of Missouri. I would like to reiterate that this is just a giveaway. That is all it is. If we want to help small businesses, then let's reinstate bonus depreciation. Let's shorten appreciation to buy new equipment and to add more jobs.

The bottom line is let the government get out of the way. Increasing their taxes at a time when the deficit is running at a record high and when the administration continues to rack up more debt is not the way to help small businesses. Again, I oppose the amendment.