PROTECTING SMALL BUSINESS, PROMOTING ENTREPRENEURSHIP

Small Business Week and Access to Capital: Congress Must Find a Path Forward on Bipartisan Bills that Help Entrepreneurs

By at 1 May, 2018, 12:26 pm

by Karen Kerrigan-

Accessing startup or growth capital is an enduring challenge for entrepreneurs.  The good news for small business owners is that legislative proposals and efforts to improve capital access are generally supported on a solid bipartisan basis by our elected officials in Washington, D.C.

The bad news, unfortunately, is that bills often get caught up in a legislative clog, or fail to move because of silly political fights.  That is the case with about a dozen or so proposals (see the list here in our 2018 Agenda for Improving Capital Access) supported by SBE Council that have passed the U.S. House either by voice vote (no opposition) or on a very wide bipartisan basis.

The bottom line is that there is no reason why these critically important bills are not moving on the Senate side of the Capitol.  The U.S. Senate did pass legislation on March 15 called the “Economic Growth, Regulatory Relief and Consumer Protection Act” (S. 2155), which would help ease bank lending. Of course that is good news for small businesses. But not all small businesses can get bank loans. They either do not qualify for such, or have financing needs that cannot be met through banks. Therefore they go to other sources for capital.

Again, improving bank lending is very important, and that is why SBE Council supported S. 2155.  The bill now needs U.S. House approval. But policymakers must also strive to improve the capital markets more broadly, which will help meet the diverse financing needs of many types of startups and small businesses.  That is where these other bipartisan bills come into play, which address outdated regulations or excessive and unnecessary red tape, for example, within Security and Exchange Commission (SEC) rules, or fix regulatory measures that need to be tweaked.

U.S. House Financial Services Committee Chairman Jeb Hensarling (R-TX) would like these SBE Council supported bipartisan bills included in S. 2155, but he has also hinted he is willing to consider other pathways.  Some Senate Democrats who supported S. 2155 say they will not vote on the bill again if it is altered by the House (even if it includes these very bipartisan changes that will help entrepreneurs and small businesses.)  This is disappointing to the millions of small businesses who need to tap other sources of capital outside of the banking system.

Bizarre and senseless political struggles often keep helpful small-business policies from advancing in the Congress.  And rather than obstructing good access to capital bills from advancing to President Trump’s desk for his signature, Senate Democrats need to be working with Chairman Hensarling to find a path forward.

Karen Kerrigan is president & CEO of the Small Business & Entrepreneurship Council.   

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