Udall Reintroduces Bipartisan Plan to Boost Job Creation, Free Up Capital for Small Businesses
Common-Sense Bill Would Cut Red Tape, Allow Credit Unions to Lend to Main Street Businesses
In an effort to jumpstart job creation in communities across Colorado and help small businesses expand, Mark Udall reintroduced the Small Business Lending Enhancement Act today. The bipartisan legislation, which Udall has championed since joining the U.S. Senate, would increase the amount of business loans that well-capitalized credit unions with proven management are allowed to issue.
Credit unions are currently required to limit their business lending to no more than 12.25 percent of their total assets. This arbitrary cap, established in 1998, has curtailed credit unions' abilities to help Main Street businesses create jobs, expand and improve Colorado's economy. Udall's proposal would allow for credit unions that meet strict criteria to lend up to 27.5 percent of their total assets.
"Colorado has a top-notch workforce, amazing natural resources and a growing innovation economy. But without access to credit, many promising startups and entrepreneurs will be unable to secure the money they need to create jobs and help Colorado win the global economic race," Udall said. "Credit unions have an important role to play, lending to startups and Main Street businesses alike. My bill helps to unleash their potential to ensure that job creators in Colorado and across the country have the capital they need to start a business or to grow."
The legislation only allows credit unions to increase their lending cap if they are in good standing and have a long-term track record of making business loans. They also need approval from the National Credit Union Administration, the federal agency that regulates federal credit unions.
The Small Business Lending Enhancement Act will help create an estimated 140,000 jobs by allowing experienced and well-managed credit unions to lend an additional $13 billion to small businesses in the first year after enactment. The bill has the support of a large and diverse coalition of organizations, including Americans for Tax Reform, the Competitive Enterprise Institute, the Progressive Policy Institute and the Consumer Federation of America.