I was surprised to hear Minority Leader Mitch McConnell say he believes the Small Business Jobs Act currently before the Senate is “a little itty-bitty small business bill that no one thinks will have much of an impact on the economy.” In fact, I would encourage him to go on the road with me to places like Saratoga Springs, where I was just yesterday meeting with several small business owners, including Larry Levita.
Larry and his son Phillip are the owners of Plum Dandy, a frozen yogurt shop in Saratoga Springs' historic downtown. A few months ago they received an SBA Recovery loan for $175,000 to open their shop, and with that they created 12 new jobs. Their loan was one of about 70,000 loans SBA has made with enhancements first provided in the Recovery Act in February 2009. Larry told me that things are going really well for them, and in fact they’re already thinking of opening a second location.
In all, SBA took about $680 million in taxpayer dollars and turned it into nearly $30 billion in small business loans across the country. And, small businesses report that these loans are helping save or create hundreds of thousands of jobs - just like the 12 Larry and Phillip Levita have created.
Demand for these Recovery loans has been so great, however, that, in May, SBA once again ran out of funds to support them. The Small Business Jobs Act before the Senate that Sen. McConnell is referring to will extend these loans again, and we have more than 1,000 small businesses on a “stand-by” list waiting for the bill to pass. That’s more than $500 million in small business loans.
Not only will the bill immediately help thousands of small business owners get access to capital, but it will also raise the limit on SBA loans from $2 million to $5 million, helping high-growth small firms who are ready to expand, franchisees who want to open a new location, and exporters who need to ramp up to meet a big order from abroad.
And on top of that, the bill has $12 billion in tax cuts for small businesses, including accelerated depreciation, eliminating capital gains on small business investments, and doubling the deduction for start-ups. It’s fully paid for and both the U.S. Chamber of Commerce and the National Federation of Independent Businesses have praised the legislation.
In other words, this is a strong bill. It has broad support. It will give taxpayers a big bang for their buck. And, it will benefit thousands of entrepreneurs and small business owners across the country, including the more than 1,000 who are right now waiting to get an SBA Recovery loan.
Small businesses employ half of all working Americans and create two out of every three new jobs each year. Now more than ever, we are counting on them to create jobs and grow the economy. And, more importantly, they are counting on us.
This bill will ensure that small business owners, like Larry and Phillip Levita, have the capital and tax credits they need to grow and create jobs. That’s no "itty bitty" thing.
Karen Mills is Administrator of the U.S. Small Business Administration