In what was an almost unconscionable act by Senator Harry Reid (D – Nev), he recently pulled the pending SBA enhancements to the current SBA 7(a) and 504 lending program from the JOBS bill where it had been piggy backed just after congress returned from recess in January. The JOBS bill is set to go to vote and expected to pass this week.
The SBA legislation would have extended American Recovery and Reinvestment Act (ARRA) stimulus funds for enhancing a borrower’s ability to borrow under the two main SBA programs. The program is planned to cost taxpayers $354 million to extend it through December 31, 2010.
The program was one of the only successes coming out of the stimulus bill that supported small business. It initially ran out of money in late November 2009. In early December Congress temporarily renewed funding for the program through February 28, 2010.
The SBA enhanced program legislation had wide support from both parties in congress and President Obama. It strengthened, not weakened the JOBS bill. It is unclear why Reid removed this important legislation from immediate passage.
The net effect is that it is unlikely that congress can get any other legislation drafted and moved through both houses before the current ending date of February 28, 2010. At best, congress can get another temporary bill drafted and passed early in March, and come back later to make it permanent. The on again, off again nature of the legislation has put many borrowers in a state of concern and uncertainty.
If a SBA loan application is received by a lender right now, it goes into a queue, waiting on passage of temporary, then permanent legislation. Small businesses need this legislation now, not in March or April. They need to know that the program will be continued through at least the end of the year.
Small business owners should write both their senators and house legislators and show their support for this important legislation. It is no wonder why many inside and outside of congress are calling the system broken, when something as important as this legislation with the support of nearly everyone in Washington and the country behind it can’t get priority for passage by our elected officials.
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