Small Business Lending Act of 2010

Floor Speech

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Mr. SCHUMER. Madam President, I rise in strong support of the amendment offered by my good friend from Colorado, Senator Mark Udall. Credit unions across the country are currently restricted in the amount of lending they can provide to their members for business purposes. The Udall amendment, which I proudly cosponsor, will raise that limit. Congress should be focused like a laser on bringing unemployment down and getting the economy humming on all cylinders again. The bill before us today is part of that ongoing effort. It is a much needed, targeted bill that will help small business expand and hire.

There are many worthy ideas and important programs in the bill, from bonus depreciation to increasing the loan limits on SBA's flagship programs to providing grants to help States expand innovative small business initiatives. But a core mission of this bill was always to jump-start lending.

When I travel around New York and talk to business owners about creating jobs, the No. 1 thing they bring up is their inability to get access to credit. I believe the small business lending fund, which I vociferously supported and which the Senate approved last week, will prove to be a shot in the arm for small business, greatly increasing access to credit. I thank my colleague from Louisiana, Senator Landrieu, and my colleague from Florida, Senator LeMieux, my colleague from Washington State, Senator Cantwell, and others, Senator Shaheen, for their efforts to reinstate this important fund. But we can't stop there.

Credit unions are an important source of credit for small businesses from coast to coast. They should not be neglected as we seek to improve the economy. When this idea was originally proposed, some concerns were raised about the safety and soundness of credit unions, their members, and the credit unions' insurance deposit fund.

My office worked with Senator Udall and the Treasury Department to come up with a plan that would address those concerns. First, the cap is only raised for credit unions that meet strict eligibility criteria.

To qualify, credit unions must be well capitalized, demonstrate sound underwriting and servicing based on historical performance, have strong management and policies to manage increased lending, and be approved by their regulator for the higher cap.

They must also be at or above 80 percent of their current cap, with 5 or more years of experience lending to member businesses. This means only credit unions with significant experience lending to small businesses will have their cap raised, and it is targeted at those credit unions most likely to expand their lending because they are at or near the existing cap.

I commend Mr. Udall, the Senator from Colorado, for taking the lead on this novel approach. His amendment is a sensible compromise that successfully addresses the concerns that were raised.

Based on conservative estimates, this amendment will lead directly to over $10 billion in new lending and will create over 120,000 jobs. In my home State of New York, it will create over $750 million in new lending and create over 8,000 jobs. It does it all with no cost to the taxpayer. I repeat, the amendment does not add a dime to the deficit and will have a positive impact on GDP.

Certainly, this amendment is not a cure-all for our economy. But with small businesses starved for credit, it seems obvious to me we should be trying everything we can to increase lending to small businesses. Simply put, this amendment is a no-brainer. I urge my colleagues to support the amendment offered by my friend from Colorado.

Madam President, I yield the floor and suggest the absence of a quorum.

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