The Senate has passed “The Small Business Jobs and Credit Act of 2010,” H.R. 5297, by a vote of 61-38. The bill originally passed the U.S. House of Representatives June 28, 2010, and it now returns to the House for final passage.
The bill creates a $30 billion lending fund that will be distributed to regional banks that will in turn lend to small businesses. It also authorizes $12 billion in tax cuts for small businesses. Advocates for the lending bill believe it will have a large impact on the U.S. economy, as small businesses employ approximately half of all Americans and account for almost 60 percent of gross domestic product.
“The passage of this bill is a long-awaited victory for the 27 million small businesses in America. Upon signature by the president, these businesses will benefit from $12 billion in immediate tax cuts," says U.S. Sen. Mary Landrieu, D-La., chairwoman of the Senate Committee on Small Business and Entrepreneurship. "(The) $12 billion will transfer from the federal treasury into the hands of small business owners to help them navigate these difficult financial times. It is the right thing to do and the smart thing to do.”
The U.S. Department of Treasury will be responsible for the small business lending fund, and some of the key provisions of Title 1 of the bill include:
- Requiring an applicant institution to provide
information to the appropriate federal banking agency, as well
as a small business lending plan, outlining how its business
strategy and operating goals would allow it to address the needs
of small businesses in the areas it serves;
- Setting forth financial incentives for small business
lending by such institutions;
- Requiring capital investment recipients to provide
outreach and advertising in the appropriate language of the
applicant pool using media outlets that target organizations,
trade associations and individuals who represent or work within
or are members of minority communities;
- Establishing the Small Business Lending Fund Program as
separate and distinct from TARP;
- Directing the secretary to study and report to Congress on the number of women-owned and minority-owned businesses that receive assistance as a result of the program.
