Senate Struggles to Pass Small Biz Bill

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After failing several times to do so, the Senate voted on Wednesday to approve a $34 billion bill that will extend unemployment benefits to millions of Americans. Assuming the bill is approved by the House of Representatives, which is almost certain, it will have several immediate consequences, including retroactively giving unemployment benefits to those who have gone without them during the two-month long deliberation process. Beyond that though, the passage of this bill also allows the Democrats to focus on their next big vote: a new bill to help small businesses.

As President Obama explained earlier this week in a statement, the new small business bill will consist of a “package of tax cuts and expanded lending,” which is designed not only to boost these businesses but to help create more jobs for Americans. Yet, the bill itself is not without controversy.

As the New York Times reports, “The main point of disagreement is the centerpiece of the legislation: a proposed $30 billion lending program that would make credit available to small businesses through local banks. Some Republicans have decried the proposal as a mini ‘bailout’ and said they would vote against it.” Indeed, some see this bill and the unemployment extension that just passed as part of a larger second stimulus package to help kick-start the economy again.

In response to these concerns, Senate Majority Leader Harry Reid (D-Nev.) made a proposal Wednesday night to ditch the $30 billion program, only to introduce another amendment shortly after that would re-instate it, according to the Times. With or without this lending program, the bill, as currently drafted, would provide $12 billion in tax relief for small businesses as well as an extension of loan guarantees that have been approved by the Small Business Administration.

This small business bill is a remnant of a much larger package of reforms called the American Jobs and Closing Tax Loopholes Act. That bill passed the House of Representatives but stalled in the Senate and was eventually broken into smaller pieces. It is unclear when the small business bill may get a vote, but as Politico notes, the Democrats would like to see it pass before August when the Senate goes on recess.

In the meantime, if you are in need of a loan for your small business, the best place to start is with a small community bank as these institutions typically have more money to lend. Check out this MainStreet article for more tips on how to get a small business loan.

—For a comprehensive credit report, visit the BankingMyWay.com Credit Center.

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