House Votes to Expand Loan Insurance for Small Businesses

“This is definitely a jobs bill, colleagues” - State Representative Paul Holvey, D-Eugene

Photo by Dave Dugdale/learningdslrvideo.com

(SALEM, Ore.) - With broad bipartisan support, the Oregon House voted today to pass a bill described by supporters as crucial to help small businesses. House Bill 4150 expands the types of businesses eligible for assistance from the Credit Enhancement Fund.

The bill’s carrier, State Representative Paul Holvey, D-Eugene, described the expanded eligibility as temporary but nonetheless vital to help Oregon’s economic recovery.

“This is a temporary bill to keep the recovery momentum going around the state,” said Holvey. “This bill will help leverage the money that banks have available to small businesses.”

The Credit Enhancement Fund is a program controlled by the Oregon Business Development Department. It provides partial guarantees on loans taken out by certain small businesses in the state, with the goal of increasing the businesses’ access to sources of capital.

The idea is that with state money guaranteeing a large part of the loan, investors will be more willing to put their resources into current or potential companies and projects, making it easier for small businesses to start up and grow in the state of Oregon. Increased growth in the small business sector will lead, in turn, to increased job creation.

The fund was previously available only to traded sector businesses, meaning businesses which sell their products in competitive national or international markets. These businesses were seen as a “distressed area,” but the expanded definition now includes businesses in the nontraded sector as well. The new definition would be effective until the summer of 2015.

The job creation aspect of the bill was presented as its most important feature, both by its sponsors and by other representatives who declared their support for it.

“This is definitely a jobs bill, colleagues,” declared Holvey when he introduced the measure.

Rep. Tobias Read, D-Beaverton, the bill’s co-carrier, also stressed the bill’s importance for small businesses and job creation.

“This bill does an excellent job of connecting capital with job creators,” said Read.

The bill received additional scrutiny on the House floor. Rep. Shawn Lindsay, R-Hillsboro, questioned Holvey and Read as to whether the modified definition would substantially alter the Credit Enhancement Fund’s current emphasis on traded sector business. The sponsors responded that while some change might be likely, it would not be too dramatic.

After a brief closing statement in which Holvey described the bill as “a common sense way to help our economy along,” House Bill 4150 passed with a vote of 59-0.

The bill’s passage was lauded as an example of the kind of bipartisan cooperation needed to continue Oregon’s economic recovery. In an additional speech at the end of the session, Rep. Matt Wand, R-Troutdale, commended House members for the cooperation they showed in passing the legislation.

Special thanks to Oregon Capitol News