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CU System
SBLFs are taxpayer-funded MBLs arent says AVCU
MONTPELIER, Vt. (8/23/11)--It’s time for S. 509, the Small Business Lending Enhancement Act of 2011, to move forward so that credit unions can help Vermont and the U.S. add a projected 140,000 jobs to the economy, Joe Bergeron, president of the Association of Vermont Credit Unions (AVCU), wrote in letters to Vermont’s Senate delegation last week. The legislation seeks to increase the cap on credit union member business lending (MBL) to 27.5% from 12.25% of assets, with limitations for safety and soundness (Newslines Express Aug. 19). He thanked the lawmakers for their support of S.509 and asked them to push the bill to the Senate floor when they return to Washington after the Labor Day recess. Credit unions have offered to Congress another $13 billion of stimulus for small business “for a long time now . . . above and beyond what they already provide,” he added. “Meanwhile, never-ending concerns about job growth and the economy continue while Congress overlooks this offer by credit unions.” Bergeron cited disappointing new job reports, anxiety about President Barack Obama’s yet-to-be-announced jobs plan, and taxpayer dollars being used to stimulate hiring via the Treasury’s Small Business Lending Fund (SBLF) as further evidence that the legislation needs to move forward quickly. He also pointed out that the boost offered by an MBL cap increase would come at no cost to taxpayers. “The recently announced Treasury release of $418 million to small banks in SBLF awards is taxpayer funded,” Bergeron wrote. “By contrast, passage of S. 509 would provide over 30 times that amount with no taxpayer cost at all. He also addressed the needs of Vermont. “Likely new loans for small businesses in the first year of enacting S.509 are estimated at $75 million, equating to about 815 new jobs (using the Council of Economic Advisors job multiplier). Those figures are quite significant by Vermont standards,” Bergeron concluded. If passed, the MBL legislations would infuse $13 billion in new small-business capital into the U.S. economy, said the Credit Union National Association.


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