MBL Introduced in U.S. House (Misc News: April 8, 2011)
Two credit union champions introduced legislation in the U.S. House on Thursday that would raise the cap on member business lending for credit unions.
CUNA News Now reported that Reps. Ed Royce, R-Calif., and Carolyn McCarthy, D-N.Y., introduced the Small Business Lending Enhancement Act, legislation that will provide much needed financing for small businesses without spending a single tax dollar.
Click here to read the News Now story.
“As the U.S. continues to grapple with both record deficits and high unemployment, Congress must look at proposals that will spur economic growth without saddling the U.S. taxpayers with more debt,” Royce said.
“Small businesses drive the economy in my district on Long Island and in communities all over America. I’m proud to reach across the aisle – and across the country – to help our small businesses and entrepreneurs grow at this critical time,” McCarthy said.
The Small Business Lending Enhancement Act would raise the current credit union member business lending cap from 12.25 percent to 27.5 percent. To qualify for the higher cap, a credit union must be well capitalized, have a history of member business lending experience, be operating near the lower cap for at least one year, and receive approval by the NCUA.
"With a projected $1.6 trillion budget deficit, stimulus spending is not an option," Royce said. "This legislation takes an important step in shifting our current economic path and putting Americans back to work. As a result of the Small Business Lending Enhancement Act, credit unions will be eligible to lend up to $10 billion to small businesses within a year, which translates into more than 100,000 new jobs."
The bill joins companion legislation introduced in the U.S. Senate last month by Mark Udall, D-Colo., and Olympia Snowe, R-Maine.
Udall spoke in support of his bill on the Senate floor last week, calling on his fellow senators to help him "get government out of the way" and allow credit unions to increase their lending to small businesses.
The Senate bill has 18 co-sponsors, and Senate Banking Chairman Tim Johnson, D-S.D., has said he is interested in examining the MBL legislation in his committee.