To permit the use of previously appropriated funds to extend the Small Business Loan Guarantee Program, and for other purposes.

Mr. Speaker, I rise in strong support of H.R. 4938, which extends the Small Business Loan Guarantee Program.

I support this legislation because in these difficult economic times, extending the Small Business Loan Guarantee Program to extend opportunities to 26.8 million small businesses is a critical component of our economic recovery.

H.R. 4938 permits the use of $40 million of the funds provided in the FY 2010 Omnibus

Appropriations Act for fee reductions and eliminations under the Small Business Administration section 7(a) loan program and the section 504 certified development company program, as well as for the cost of guaranteed loans for qualifying small businesses. The measure also extends through April 30 the ability of the SBA to guarantee up to 90 percent of qualifying small business loans originating under the 504 program, and to refinance such loans.

Small businesses employ just over half of all private sector employees, with a payroll of about $175 billion, and create many of the new jobs we need.

In my district, the 37th Congressional District of California, there are approximately 16,300 small businesses.

But in the global economy of the 21st century, small businesses, very much like the banks and the auto industry, need sound fiscal options to remain competitive, especially in difficult economic times for them and their customers.

This is where the Small Business Administration can help.

The SBA exists to aid and protect the interests of small business concerns, to preserve free competitive enterprise and to maintain and strengthen the overall economy of our Nation.

The SBA was established in 1953 by the Federal Government to aid, counsel, assist and protect the interests of small business concerns, to preserve free competitive enterprise and to maintain and strengthen the overall economy of our Nation.

The SBA's Office of Business Development assists firms owned and controlled by economically and socially disadvantaged individuals enter the economic mainstream by providing firm-specific analyses, counseling, management training, professional consulting and monitoring services, and access to business development opportunities under section 8(a) of the Small Business Act.

Much like the loan guarantee program, the Section 8(a) program is well intended. But one of its problems is that too often program participants are ``graduated'' before they are sufficiently prepared to compete for contracts with large and established companies in the private sector.

This has resulted in a large number of former 8(a) companies failing to remain in business shortly after leaving the development program.

I have introduced legislation that can build upon the loan guarantee program extended by H.R. 493 and which would eliminate the problem of ``graduating'' Section 8(a) program participants before they are sufficiently prepared to compete for contracts with large and established companies in the private sector.

My legislation, H.R. 4897, the ``Not Too Small To Succeed in Business Act,'' reforms and modernizes the Section 8(a) program to help more small and disadvantaged business enterprises (DBE) remain in business and hire more workers by doing the following:

1. Amending the Small Business Act to increase the net worth limits-- to $750,000--used by SBA in determining whether an applicant satisfies the ``economically disadvantaged'' requirement for admission to the program and increases to $2.25 million the net worth required for early graduation from the program.

2. Extending the Section 8(a) program period to 11 years, from the current 9 years.

3. Granting a one-time 2-year reinstatement in the Section 8(a) program for companies who were graduated from the program at the expiration of the 9 year term.

Mr. Speaker, extending the SBA Loan Guarantee Program and amending the Section 8(a) Small and Disadvantaged Business Enterprise Program are a necessary part of strengthening our SBA programs to help small business succeed and provide jobs for our people. I urge all Members to join me in voting for H.R. 4938.

Mr. Speaker, I move to suspend the rules and pass the bill (H.R. 4938) to permit the use of previously appropriated funds to extend the Small Business Loan Guarantee Program, and for other purposes.

Mr. Speaker, I ask unanimous consent that all Members have 5 legislative days to revise and extend their remarks on H.R. 4938.

I yield myself as much time as I may consume.

Mr. Speaker, the bill before us provides for a 1-month extension of the Recovery Act small business lending program and provides an additional $40 million for this program. Through March 12 of this year, the small business lending program has supported nearly $23 billion in small business lending which helped create or retain over 560,000 jobs. The program eliminated the fees that borrowers and certain lenders are normally charged for loans through the Small Business Administration's 7(a) and 504 loan programs. The Recovery Act also increased the government's guarantees on the 7(a) loans from 75 percent to 90 percent.

Mr. Speaker, 7(a) is the SBA's primary program for helping startup and existing small businesses with financing guaranteed for a variety of general business purposes. SBA does not make loans itself but rather guarantees loans made by participating private lending institutions. Like most commercial loans, these loans are typically variable rate.

The 504 program provides growing businesses with long-term, fixed- rate financing for major fixed assets, such as land and buildings, through Certified Development Companies. A Certified Development Company, CDC, is a private, nonprofit corporation set up to contribute to the economic development of the community it serves.

When credit markets froze in late 2008, credit markets that service small businesses froze as well and have continued to be hard hit. These provisions have been working to loosen up the credit market for small businesses so they can stay in business, keep people employed, and make new hires.

As we know, in a very bipartisan way, we have all felt that there is nothing more important we could do right now but to allow for small businesses to thrive as we move to create jobs in our economy. And so I would hope that everybody in a unanimous fashion, Mr. Speaker, can support this bill.

I reserve the balance of my time.

Mr. Speaker, first of all, I want to thank my ranking member, Mrs. Jo Ann Emerson, who is a true partner in the work we do in our committee. We are an example of how to work together. I want to also thank her, Mr. Speaker, for the fact that she noted that I'm not spending one extra dollar here. This is not raising the deficit at all.

I will yield.

Well, I am very happy that you're proud of me. Mr. Speaker, I am very happy that she's proud of me.

Mr. Speaker, I do want to clarify something, and the question that Mrs. Emerson asked is a very legitimate question: Why are we doing this the way we're doing it? Simply because we have not been able to get the other body, if I'm allowed to refer to them, to accept anything other than these kinds of bills at this point. And in answer to her second question, Which bill will we give the Senate, the one that we passed, or the one hopefully we'll pass today, the answer is, whichever one they'll take to deal with the issue. So that is really the problem here. Hopefully it will be resolved very soon.

I reserve the balance of my time.

Mr. Speaker, I am in total agreement with my ranking member. It is our desire to make this permanent. We will continue to work on this. In the meantime, this provides the assistance that small businesses need in this country.

Mr. Speaker, I yield back the balance of my time.

Mr. Speaker, I yield myself such time as I may consume.

All Members, all of us, have been hearing from our constituents that banks are not lending to small businesses. The Financial Services Appropriations Subcommittee has heard testimony that this is the result of banks' unwillingness to take risks or reduce their capital reserves. In addition, bank regulators have increased scrutiny on lending practices. The funding and language included in this bill attempts to address this problem by increasing the SBA loan guarantee to 90 percent for certain small business loans and eliminating, as the chairman said, certain borrower fees associated with SBA's business loans. I greatly appreciate that my chairman, Jose Serrano, has not increased spending in this bill but is allowing SBA to use other available resources to continue funding these programs.

With unemployment at almost 10 percent, now is not the time to make it harder for small businesses to get credit, and these programs should and must be continued. However, I have to say that I am a bit troubled with the manner in which this bill is being considered. Just yesterday, the House passed the Disaster Relief and Summer Jobs Act that includes funding and language to continue these SBA programs through April. So my question is, which bill does the majority intend the Senate to act on? If yesterday's bill was not so controversial, perhaps today's bill would not be necessary.

Neither the disaster bill nor the SBA bill was marked up by the Appropriations Committee. The majority did not seek input from the minority in either of these bills. We've known since the enactment of the stimulus bill over a year ago that SBA did not have sufficient funding to continue these programs through fiscal year 2010. Yet instead of dealing with it in a more comprehensive manner either in the fiscal year 2010 omnibus or in a committee markup earlier this year, we're now only providing SBA with enough funding to continue these programs for one additional month. We could have marked up a bill in committee that provides SBA with sufficient funding for the rest of the fiscal year and come up with a spending offset that both sides of the aisle could agree to. Instead, we'll continue to create anxiety for small businesses, lenders, and the SBA that borrower fees will increase and guarantees will decrease at the end of April.

I have great, great respect for Chairman Serrano, and I'm sure he would also like to deal with this problem in a comprehensive manner as opposed to on a month-to-month basis. Mr. Speaker, I support Chairman Serrano's proposed legislation because of its importance in providing credit to small businesses. However, I am disappointed that we are only temporarily addressing this program. I am also disappointed that we didn't consider this legislation in regular order.

I reserve the balance of my time.

Will the chairman yield?

I am very proud of you, and I just wanted you to know that.

Mr. Speaker, I would just like to, once again, thank Chairman Serrano. I know he feels very strongly, as I do, that we have to find a way to make this permanent rather than force people to be anxious on a month-to-month basis. Hopefully in the next few months we'll be able to create some kind of bill or be able to satisfy all of the people who are so desperate to take the risk and become entrepreneurs and really make a difference in putting people back to work. So with that, I thanks the chairman, I thank the Speaker.

I yield back the balance of my time.

Madam President, I ask unanimous consent that the Senate proceed to the immediate consideration of H.R. 4938, an act to provide for a 30-day extension of the Small Business Loan Guarantee Program which was received from the House and is at the desk.

I ask unanimous consent that the bill be read three times, passed, the motion to reconsider be laid upon the table, and that any statements relating to the bill be printed in the Record.