Two bipartisan bills recently proposed by U.S. Sen. Todd Young (R-IN) would improve the Small Business Administration’s (SBA) 504 loan guaranty program, which provides small businesses with long-term, fixed-rate financing for major fixed assets like land equipment and machinery.
“Small businesses are the backbone of our economy, creating about two-thirds of new American jobs and generating nearly half of U.S. economic activity,” Sen. Young said. “In Indiana, the SBA’s 504 loan program has led to more than $1.8 billion in expansion financing and has saved or created tens of thousands of Hoosier jobs.”
Sen. Young on June 24 sponsored the 504 Credit Risk Management Improvement Act of 2021, S. 2245, with lead original cosponsor U.S. Sen. Amy Klobuchar (D-MN), which would direct the SBA’s Office of Credit Risk Management to supervise Certified Development Companies (CDCs) participating in the 504 program, according to a bill summary provided by Sen. Young’s office.
Additionally, S. 2245 would require the office to review a random selection of loan closings to ensure program integrity, consolidate findings into a report, and send the report to the relevant parties and would allow the office to take informal and formal enforcement actions against CDCs if it finds they violated the 504 program requirements, according to the summary.
Also on June 24, Sen. Young signed on as the lead original cosponsor of the 504 Modernization and Small Manufacturer Enhancement Act of 2021, S. 2231, with bill sponsor Sen. Klobuchar to improve the SBA’s 504 loan guaranty program and enhance the ability of small manufacturers to access affordable capital, the bill text says.
Specifically, S. 2231 would increase the maximum loan amount for small manufacturers to $6.5 million from $5.5 million; decrease project costs for small manufacturers and adjust job creation and retention requirements; and streamline numerous administrative processes associated with the 504 loan closing process by allowing accredited CDCs to perform closing-related tasks, according to Sen. Young’s bill summary.
“I am proud to support this legislation, which will help small businesses expand or begin new projects to grow the local Hoosier economy,” said Sen. Young.