The long-delayed bill now heads to Obama. The wait for action was agonizing for owners who have been seeking loans.
House gives final OK to a bill to provide loans and cut taxes.
Ending months of partisan delay, the House gave final passage Thursday to a small-business tax and lending assistance bill, handing Democrats a legislative victory on the economic issues central to the midterm elections.
President Obama had pressed Congress to pass the bill despite scant Republican support, and small-business owners welcomed his pledge to sign it into law Monday.
“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. “After months of partisan obstruction and needless delay, I’m grateful that Democrats and a few Republicans came together to support this common-sense plan to put Americans back to work.”
The summer-long wait for action was agonizing for small-business owners, many of whom have been seeking loans for months in the tight credit market.
The legislation has been closely watched in Southern California, where more than half the jobs are at small businesses.
“It’s a really, really big deal,” said Scott Hauge, president of the advocacy group Small Business California. Hauge said the legislation would save many owners from filing for bankruptcy by reducing tax burdens and making it easier to obtain loans.
The bill began with bipartisan interest because both parties see small businesses as vital to the economic recovery. But Republicans opposed a Democratic move to add a $30-billion small-business lending fund, which GOP lawmakers compared to the 2008 bank bailout that provided $700 billion to create the Troubled Asset Relief Program.
The small-business bill passed Congress on largely
Only one Republican, Rep. Walter B. Jones of North Carolina, voted for the bill Thursday. In the Senate, two Republicans, Sen. George LeMieux of Florida and Sen. George V. Voinovich of Ohio, both of who are retiring this year, joined Democrats in passing the bill last week.
The measure was among the last remaining legislative initiatives intended to spur the struggling economy as Congress prepares to adjourn so members can campaign for the midterm elections in November.
The bill creates the $30billion lending fund to help smaller banks make loans to businesses, and offers $12 billion in business tax breaks to encourage investment, entrepreneurship and hiring. Democrats estimate that the legislation could create 500,000 jobs.
With the tax cuts, businesses would be able to write off more of their costs of buying equipment or making shop improvements. Individuals who are self-employed could deduct healthcare costs from the self-employment tax.
The bill would also continue to waive Small Business Administration loan fees that had been set aside as part of the 2009 recovery package.
The cost of the bill is offset by closing tax loopholes and increasing tax-reporting requirements and penalties.
The tax provisions in the legislation would be particularly helpful to small businesses, Hauge of Small Business California said. In California, as many as 2 million sole proprietors — people who own the smallest businesses — will save thousands in self-employment taxes that they previously had to pay on health insurance premiums they paid for themselves, he said.
Derek Rigaud, who is trying to buy a franchise of the children’s hair salon Snippets, applied for loans from five banks before he was finally approved for a Small Business Administration loan from City National Bank of Los Angeles.
Thursday’s passage of the small-business bill means he will save $4,400 in fees on the $195,000 loan, a bank spokeswoman said.
“The savings will definitely help,” Rigaud said. “Any kind of savings you can get will put more money into the business.”
Jim Wullschleger, who heads small-business lending for City National Bank, said the measure would allow his institution and others to increase their lending to small businesses and spur the creation of new jobs.
The long wait for approval was frustrating, Wullschleger said. “It just put people into limbo.”
Kent Peterson’s Long Beach company, P2S Engineering, was approved for a $1.2-million loan SBA to renovate its Long Beach headquarters in April, before funds for the loan program ran out.
Without the additional funding approved Thursday, the firm’s loan would have been cut significantly, Peterson said, and the engineering firm would have had to pay $35,000 more in fees.
The renovations, initially scheduled for last summer but delayed while Congress bickered about the bill, include a gym for employees and energy-efficient lighting.
“I’m very pleased,” Peterson said. “Very pleased to the tune of $35,000.” email@example.com sharon.bernstein @latimes.com