WASHINGTON – United States Senators Mary L. Landrieu, D-La., Chair of the Senate Committee on Small Business and Entrepreneurship, and George LeMieux, R-Fla., today sent a letter to Secretary of the Treasury Timothy Geithner requesting swift implementation of the Small Business Lending Fund (SBLF) and the State Small Business Credit Initiative, two provisions in the Small Business Jobs Act of 2010. Senators Landrieu and LeMieux were instrumental in including the SBLF in the Small Business Jobs Act of 2010, a provision that has created a $30 billion strategic partnership with community banks to boost lending to small firms.
“As you know, community banks participate disproportionately in small business lending compared to large banks,” Senators Landrieu and LeMieux said in the letter. “With this in mind, it is imperative that we do all we can to assist these community banks in increasing small business lending. The thoughtfully designed programs in the Act are crucial for community banks across the country. Thoughtful and prudent implementation is also necessary, and we ask that you act as quickly as possible. We urge you to retain small business access to capital as your top priority in implementing provisions of the Act.
“For months during the crafting of the underlying bill, we heard from bank after bank that would benefit from the Small Business Lending Fund as well as from the State Small Business Credit Initiative. Since the bill was signed into law on September 27, 2010, our offices have heard from countless additional banks that are eager to access these important programs. Banks who participate will have economic incentives to increase their small businesses lending. In turn, this will provide vital support to our small businesses in these difficult economic times.”
The Small Business Lending Fund would inject $30 billion through health community banks into the small business economy. This provision is estimated to save taxpayers $1.1 billion over ten years. The Small Business Lending Fund was endorsed by several organizations including the Independent Community Bankers of America, the American Bankers Association, the National Small Business Association, the National Association for the Self-Employed, Small Business Majority, the National Bankers Association and the Conference of State Bank Supervisors, among others.
The State Small Business Credit Initiative provides $1.5 billion in grants to support at least $15 billion in new small business lending through already successful state run programs. Many of these state run programs are facing cutbacks due to budget shortfalls and this initiative will allow states to build upon successful models for state small business programs, including Capital Access Programs (CAPs), collateral support programs, and loan guarantee programs, including those targeted at rural and agricultural small businesses.
To see a copy of the letter sent to the Treasury Department please click here.