ORTIZ VOTES TO EXPAND LENDING TO SMALL BUSINESSES
Jun 18, 2010 (Congressional Documents and Publications/ContentWorks via COMTEX) --
WASHINGTON - U.S. Rep. Solomon P. Ortiz (D-Texas) voted today in the House of Representatives to expand lending and offer tax incentives to small businesses while creating thousands of jobs in South Texas.
The Small Business Lending Fund Act and Credit Tax Relief Act provide up to $30 billion in loans for small businesses through a lending fund for small and medium-sized community banks. The bill does not add to the deficit.
"Small businesses are where most Americans go to work every day. Over the last 15 years, they've created 64 percent of the new jobs in our economy, and we're counting on them to play a leading role in today's economic recovery," Ortiz said. "Yet many small businesses are struggling to stay in business, much less expand. Through this bill we allow small businesses and community banks to come together and support our local economies in South Texas."
Small Business lending fund Act (H.R. 5297)
Small Business Lending Fund: Delivers loans to small businesses to create jobs through a new $30 billion lending fund for small and medium-sized community banks.
*Community banks provide the credit that small businesses need to grow and create jobs in communities across the country.
The banks would repay the government's investment at a dividend rate starting at 5% with lower interest payments if they expand their small business lending. That rate would drop by 1% for every 2.5% increase in small business lending that the bank shows compared to 2009. A lender could cut its dividend rate to just 1% by increasing small business loan portfolios by 10%.
But if the bank reduced its small business lending, its repayment dividend would shoot up as high as 7%.
Small Business Jobs Tax Relief Act (H.R. 5486)
*Spur Investment in Small Businesses: Increases the capital gains tax cut for those who invest in small businesses this year. The bill would exclude 100% of capital gain income for stock in small businesses purchased from March 15, 2010 to January 1, 2011.
.Small Business Penalty Relief: Fixes a tax shelter disclosure penalty (Section 6707A) which currently disproportionately impacts small businesses. Endorsed by the Small Business Council of America, the bill makes penalties for failing to disclose reportable transactions on their taxes proportionate to the underlying tax savings for small businesses. Some businesses were assessed penalties as high as $300,000 for receiving a tax benefit of as little as $15,000.
*Increase in deduction for business start-up expenditures: Increases to $20,000 (from $5,000 in current law), the deduction for start-up expenditures in connection with investigating the creation of a business (but not capital or equipment), and allows more businesses to qualify for the maximum deduction. By allowing entrepreneurs to recover more start-up expenses, small business owners can focus more on hiring new workers and expanding their businesses.
The Small Business Lending Fund Act and the Small Business Job Tax Relief Act have been endorsed by a variety of organizations, including the National Small Business Association, the Small Business Majority, National Association of Realtors, the Conference of State Bank Supervisors, the American Bankers Association, Biotechnology Industry Organization and the National Bankers Association.
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