Tag Archive | "legislation"

Congress Clears Bill Aimed at Boosting Auto Dealers


WASHINGTON – The U.S. Congress gave final approval to legislation aimed at boosting lending to small businesses in what is likely to be the Democrats’ final jobs bill before the Nov. 2 elections, Bloomberg reported.

The House passed 237-187 a measure offering tax cuts, loans and revived stimulus provisions to ease the flow of credit and show voters that Democrats are trying to boost the economy. The bill, approved by the Senate last week, goes to President Barack Obama for his signature.

The dealer portion of the legislation seeks to loosen credit by increasing the maximum size of a federally guaranteed loan that can be extended by the U.S. Small Business Administration.

It would enable small auto dealers to receive federally guaranteed loans of as much as $5 million — up from $2 million. It would affect the SBA’s year-old floorplan financing program for dealers, which has struggled to attract lender participation.

“The small-business jobs bill passed today will help provide loans and cut taxes for millions of small-business owners without adding a dime to our nation’s deficit,” Obama said in a statement. “I look forward to signing the bill.”

Economist Alan Blinder, a former Federal Reserve vice chairman, said many small businesses have had “extreme” difficulty getting loans, though he said poor sales remain their biggest problem.

“They always have a hard time getting credit, and given the state of the markets they’re having an even harder time now,” Blinder said in an interview. “This ought to be helpful on that score, but if the economy grows at one and a half percent, we’re spitting in the wind because there’s no demand.”

“The thing that drives small businesses over and above everything else is the ability to sell their product,” he said.

Republicans objected to provisions creating a $30 billion program in which the Treasury Department would buy preferred shares in community banks, with participants paying the government dividends on a scale depending on how much they increase lending. They said the plan amounted to little more than a smaller version of the Troubled Asset Relief Program.

“This is TARP, pure and simple,” said Representative Jeb Hensarling, a Texas Republican. “It is the capital purchase program with a different name.”

Thirteen Democrats voted against the measure. Walter Jones of North Carolina was the only Republican to support it.

For all the controversy over the lending initiative, it’s far from certain banks will participate in the program, said Mark Zandi, chief economist for Moody’s Analytics. Banks will probably be reluctant to take the government’s money, he said, after seeing TARP recipients hit with retroactive executive-compensation limits amid a public outcry over tax dollars going to institutions paying million-dollar salaries.

“I’m skeptical that banks will actually take the government up on their offer,” said Zandi. “The memory of TARP will be in the minds of those lending institutions, and they’ll be reluctant to use the capital.”

Posted in Auto Industry NewsComments (0)

House to Vote on Small-Business Bill Next Week


WASHINGTON – The House of Representatives will vote on a package of loan incentives and tax breaks for small businesses next week, House Democratic Leader Steny Hoyer said on Friday, Reuters reported.

The vote will not take place before 6 p.m. on Wednesday, Hoyer said.

The Senate has already approved the bill. If the House passes the measure as expected, it would head to President Barack Obama to sign into law.

With the unemployment rate stuck at 9.6 percent, Democrats are eager to show voters they are taking steps to improve the economy before the November 2 congressional elections. Many of their other job-creation efforts have been blocked by Republicans this year.

Small businesses have complained that they have had difficulty getting access to credit after banks scaled back lending activity during the 2007-2009 financial crisis.

The bill, backed by industry groups, would set up a $30 billion fund that the government would invest in independent community banks to encourage lending to small firms.

It would also exclude from taxes all capital gains on sales of small-business stock, and accelerate business tax write-offs for purchases of new equipment and other expenses. Tax breaks in the bill total $12 billion.

Posted in Small Business TipsComments (0)

House to Take Up Bill Allowing Dealers to Receive Up to $5M in SBA-backed Loans


WASHINGTON – The House next week will take up a bill passed by the Senate that would enable small auto dealers to receive federally guaranteed loans of as much as $5 million — up from $2 million, Automotive News reported.

The provision is part of a small-business jobs bill that seeks to increase lending and would provide $12 billion in tax cuts to small businesses.

House Majority Leader Steny Hoyer said that Democrats are discussing how to proceed with the Obama administration-backed legislation that passed the Senate Thursday with two Republican votes.

The dealer portion of the legislation seeks to loosen credit by increasing the maximum size of a federally guaranteed loan that can be extended by the U.S. Small Business Administration.

It would affect the SBA’s year-old floorplan financing program for dealers, which has struggled to attract lender participation.

“This bill will provide needed assistance to small businesses and help them expand and add jobs,” Hoyer, D-Md., said in a statement.

With President Obama, the Senate and House leaders now behind the bill, it seems increasingly likely to be enacted as Democrats try to provide a jobs stimulus in advance of the Nov. 2 congressional elections.

The National Automobile Dealers Association hailed Congress today for its efforts to raise loan limits to $5 million for small businesses..

“Five million dollars is such a key number for dealers,” NADA spokeswoman Bailey Wood said. “Nationally, dealers on average hold approximately $5 million of inventory.”

The Senate bill also would increase the portion of the loan that is guaranteed by the federal government.

Currently, the government backs 75 percent of loans of up to $2 million to small businesses. Under the legislation, it would guarantee 90 percent of loans of up to $5 million.

Together, the lifting of loan limits and the increase in the federally-backed portion of the loan would be “huge,” Wood said.

The credit crisis has made it difficult for many dealers to obtain floorplan financing from lenders, especially since U.S. auto sales plunged to 27-year lows last year and have been slow to recover.

Posted in Auto Industry NewsComments (0)

Senate Passes Small-Business Bill. Now What?


After considerable delays and a lot of public prodding by President Obama, the Senate passed the small-business aid bill on Thursday, by a vote of 61-38, reported AOL Small Business.

The measure allows for a $30 billion government fund that will significantly boost lending opportunities for small businesses, which have long suffered from the recession-fueled credit crunch. The fund is available to community banks, and by some estimates, could be used to leverage as much as $300 billion in loans to small businesses.

In addition, the legislation provides $12 billion in tax breaks, including an immediate 50 percent write-off for new equipment purchases in 2010, applicable for large and small businesses. The breaks would help retailers and restaurants that build new stores or remodel existing ones. The biggest short-term beneficiaries of this tax cut, however, would likely be large businesses recovering capital improvement costs through depreciation.

The measure also lowers fees for Small Business Administration loan programs while increasing loan guarantee and lending limits, exempts some long-term investors in small business from paying capital gains taxes and allows small-business owners to deduct the costs of health insurance for themselves and their families from self-employment taxes for the 2010 tax year.

“At a time when small-business owners are still struggling to make payroll and they’re still holding off hiring, we put together a plan that would give them some tax relief and make it easier for them to take out loans,” the president said Wednesday, prior to the bill’s passage.

The bill now returns to the House, where it is expected to be approved as early as next week and then sent to Obama’s desk.

Posted in Small Business TipsComments (0)

Senate Tax Duel Centers on Small Business


With the economy sputtering, Democrats have signaled they will turn a September Senate showdown on a small-business lending bill into a key test of who is working to boost jobs. But Republicans instead are focusing attention on the impending expiration of Bush tax cuts, which they say would hurt those small businesses, reported The Washington Times.

On Wednesday, Vice President Joe Biden fired back at Republicans’ tax claim, calling it “a bunch of malarkey” and saying that the White House wants to extend most of the Bush tax cuts – just not those that would help the highest-income families.

“Our colleagues on the other side think we should extend the whole tax cut, to the people who are in the top 2 percent,” Biden said at a roundtable with local business owners in Washington. “To extend those tax cuts costs $700 billion over 10 years at a time when we are worried about the economy, when long-term we have to be worried about deficits.”

But with the economy shaping up as the dominant issue headed into November’s elections, Republicans and even some Democrats say the tax cuts should be allowed to remain on the books, at least in the near term, so as not to hurt businesses that create the most jobs.

President Obama says high-income taxpayers – individuals making more than $200,000 and families with incomes higher than $250,000 – can afford to take the hit, and that the government needs the money. Mr. Biden said Wednesday that 50 percent of those tax cuts are going to people with average incomes of $8.2 million.

Business advocates, though, say that because of the way they are structured, many small businesses pay taxes as individual filers, thus the tax increases will hit them at a time when they are already suffering.

“A lot of small businesses right now, they’re struggling with sales. There’s a lot of uncertainty and we’ve done some polling that said the No. 2 concern for small businesses is the uncertainty about where the tax rates will be and what Congress is doing,” said Chris Walters, a lobbyist for the National Federation of Independent Business (NFIB).

An analysis by the Joint Committee on Taxation found ammunition for both sides of the debate.

Only about 3 percent of the country’s 30 million small businesses would be affected, but the taxes would apply to about half of all small-business income. The difference comes because most small businesses earn so little – but the largest small businesses employ hundreds of people and make up a giant percentage of total small-business income.

Posted in Small Business TipsComments (0)

Obama Renews Call for Passage of Jobs Bill


WASHINGTON – President Barack Obama renewed his call for Senate Republicans to stop blocking a jobs bill intended to help small businesses, CNN reported.

Just before leaving for vacation, Obama told reporters at the White House that political gamesmanship instead of legitimate policy differences is stalling the bill.

He noted that the legislative process includes “times when good people differ in good faith.”

“This is not one of those times,” Obama said, adding that Republicans drafted parts of the legislation now being filibustered by Senate Republicans to prevent a vote.

Obama said the bill will come up first when the Senate returns from its August recess, and he called for the Senate Republican leadership to halt efforts to stop it.

Senate Minority Leader Mitch McConnell, R-Kentucky, complained in a statement issued before the chamber recessed that Democrats were preventing votes on Republican amendments to the bill.

The Small Business Jobs and Credit Act stalled in the Senate would authorize the creation of a $30 billion lending fund. The Treasury Department would run the program, which would deliver ultra-cheap capital to community banks, defined as those with less than $10 billion in total assets.

Other key components of the bill would provide $12 billion worth of tax relief for small businesses between 2010 and 2020, according to a preliminary estimate from the Joint Committee on Taxation. The bill also would increase Small Business Administration loan limits and extend loan sweeteners through the end of the year.

It would offer a slew of tax cuts for small businesses to encourage both investment and entrepreneurship. And the legislation would provide $1.5 billion in grants to state lending programs that can’t turn to empty state coffers for more cash.

Posted in Small Business TipsComments (0)

Page 4 of 9« First...23456...Last »