Leaders of the Senate Committee on Small Business and Entrepreneurship have introduced legislation to provide more capital for small businesses by expanding SBA lending limits.
Committee chair Mary Landrieu, D-La., and ranking member Olympia Snowe, R-Maine, introduced S. 2869, the "Small Business Job Creation and Access to Capital Act of 2009." The bill would increase the limit for Small Business Administration-guaranteed loans to as high as $5.5 million and extend for a year the fee eliminations and increased guarantee that are both set to expire under the Recovery Act.
"Our nation's small businesses have created 64 percent of all new jobs in the last 15 years, yet in the last year nearly 85 percent of the jobs lost have come from small businesses," Landrieu said in a statement. "Now that we have stabilized Wall Street, it is time to jump-start Main Street, and that begins with implementing the vital provisions within this bill.
The bill would increase the loan limit on the SBAs 7(a) loans from $2 million to $5 million and increase the loan limit on SBA 504 loans from $1.5 million to $5.5 million. It would also increase the loan limit on microloans from $35,000 to $50,000 and increase the maximum loan made to a microloan intermediary from $3.5 million to $5 million.
In addition, the bill would allow the 504 loan program to refinance short-term commercial real estate debt into long-term, fixed rate loans; and extend the authorization to provide 90 percent guarantees on 7(a) loans and fee elimination for borrowers on 7(a) and 504 loans through Dec. 31, 2010. Finally, the bill would direct the SBA to create a Web site where small businesses can identify lenders in their communities.
Landrieu said the loan limit increase could boost SBA lending by $5 billion next year alone, while the refinancing component of the bill could help save 60,000 jobs.
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