SHAHEEN CALLS FOR EXTENSION OF CRITICAL SMALL BUSINESS PROGRAMSMarch 15, 2012
(Washington, D.C.) – U.S. Senator Jeanne Shaheen (D-NH) took to the Senate floor today to fight for extensions to a pair of critical small business programs as part of the Jumpstart Our Business Startups (JOBS) Act, which is currently under debate in the Senate. Shaheen called for reauthorizations to both the Export-Import Bank, which helps small businesses sell their products overseas, and the Small Business Administration’s 504 refinancing program, which helps small firms refinance their real estate loans. Both programs are funded at no cost to taxpayers.
Below are Shaheen’s remarks, as prepared for delivery.
When I talk to owners, operators and employees of small businesses in New Hampshire, I hear consistently that access to capital is a challenge. While our community banks have increased their lending, capital access from large banks and other entities has been very hard to come by.
As a result, small businesses fighting to grow and create jobs continue to be constrained in their efforts.
I’m glad that the Senate plans to move forward with legislation that will take additional steps to help those small companies get the financing they need to grow.
But as we take that step forward, it is equally important that we don’t also take a step back.
That’s why it is critical for the Senate to extend two venues of small business financing as part of this debate – the Export-Import Bank and the Small Business Administration’s 504 refinancing program. These programs, which bring no cost to the taxpayer, provide financing options for many small businesses across our country.
We have an important opportunity to ensure that such important avenues to capital remain available in the coming years by extending these programs as part of the small business capital package before us today.
First, I’d like to talk about the Export-Import Bank, a vital agency that helps many small businesses secure the financing they need for export deals.
Last August, I held a Small Business Committee field hearing with my colleague from New Hampshire, Senator Ayotte, on small business exporting. We heard how difficult it can be for a small company to sell its products overseas. It can be particularly challenging for a small business to get financing for its foreign deals.
That’s where the Export-Import Bank makes a significant impact. Eighty-seven percent of the Export-Import Bank’s transactions support small businesses. Last year alone, the Bank helped finance more than 6 billion dollars in export sales from small companies in the United States. It has set a goal of increasing this volume by an additional $3 billion in the coming years, and has created a new “Global Access for Small Business” initiative designed to dramatically increase the number of small companies taking advantage of its programs.
And again, most importantly, the Bank assists these small businesses at no cost to the taxpayer.
Unfortunately, this no-cost small business program is in jeopardy. Unless we act soon to reauthorize the Export-Import Bank, it will hit its lending cap and will be forced to cut off its support for small businesses. We can’t afford to let that happen.
Without the Bank, small businesses will lose a significant amount of foreign sales and the jobs they maintain. Last year, the Bank supported over 288,000 American jobs.
As more small companies become aware of the Bank’s programs, more businesses will be able to access new markets and create new jobs.
Let me give you an example. Last year, I hosted the Chair of the Export-Import Bank in Portsmouth, New Hampshire to meet with small businesses interested in exporting. One of those small businesses was Skelley Medical, a medical equipment company based in Hollis, New Hampshire.
Before our event, Skelley Medical was unaware of the programs offered by the Export-Import Bank. Two weeks later, the company took out a policy with the Bank, which has put Skelley in a position to expand its sales overseas. Right now, this company is looking to finance deals in as many as five international markets, thanks to the help of the Export-Import Bank.
Without the Export-Import Bank, that kind of small business success story won’t happen.
It would be a mistake to pass a capital access bill without this critical reauthorization.
Now, I’d also like to talk about another no-cost program that deserves to be extended, the Small Business Administration’s Section 504 refinancing program.
With bipartisan support, the Small Business Jobs Act created this program to help small businesses refinance existing loans under the SBA’s 504 lending program.
As my colleagues know, the difficult real estate market has made it challenging for many successful small businesses to refinance their real estate deals, but this program allows small companies to lock in long-term, stable financing so that they can free up capital to invest in their companies and hire new workers.
Although this program did have a slow start, the SBA has made important implementation changes to ensure the best fit for small businesses and banks. As a result, we are starting to see a significant increase in volume.
Lenders in New Hampshire see this program becoming a real success in the near future. Alan Abraham, the president of the Granite State Development Corporation, has said that “banks and borrowers are now understanding the significant benefits of the program.” He told me: “We are starting to field many phone calls requesting information on the policies, and we anticipate dozens of New Hampshire small businesses could benefit from extending this program.”
We cannot cut this program off at the knees just as it is beginning to demonstrate substantial returns – again, at no cost to American taxpayers.
The program is scheduled to sunset in September, and it is important for the lending community to know as soon as possible that the program will continue into 2013, so that they can devote the resources necessary to continue this initiative’s burgeoning success.
There is no reason for us to fail to extend this program. That’s why I urge my colleagues to work with me and Chair Landrieu to include an extension of this program, as well as the Export-Import Bank reauthorization, in this small business support package.
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