[Congressional Record (Bound Edition), Volume 163 (2017), Part 4]
[Extensions of Remarks]
[Page 5211]
[From the U.S. Government Publishing Office, www.gpo.gov]




 INTRODUCTION OF THE ``INVESTING IN AMERICA'S SMALL BUSINESSES ACT OF 
                                 2017''

                                 ______
                                 

                        HON. CAROLYN B. MALONEY

                              of new york

                    in the house of representatives

                        Thursday, March 30, 2017

  Mrs. CAROLYN B. MALONEY of New York. Mr. Speaker, this week is 
National Small Business Week, a time each year for our nation to 
recognize and celebrate the critical contributions of America's 
entrepreneurs and small business owners.
  I am pleased to support our nation's small businesses by introducing 
the Investing in America's Small Businesses Act of 2017. This important 
legislation allows Community Development Financial Institutions, known 
as CDFIs, to extend affordable credit to more small businesses in 
underserved communities through microloans. These small loans, under 
$50,000, give businesses working capital, help them invest in new 
equipment or supplies, and have no pre-payment penalties.
  I'm proud that the Investing in America's Small Businesses Act has 
gained the endorsements of the CDFI Coalition, the Opportunity Finance 
Network and the National Federation of Community Development Credit 
Unions, the national voices for these community-based institutions.
  The bill provides grants for CDFIs to establish loan-loss reserve 
funds for microloans, which will help CDFIs leverage private investment 
to expand small business lending in underserved communities.
  Small businesses are critical engines of economic development and job 
creation. In underserved communities, however, small businesses with 
low-income and minority owners often have limited access to affordable 
credit they need to meet everyday demands or expand their operations. 
According to a study commissioned by the U.S. Small Business 
Administration in 2013, ``the major constraint limiting the growth, 
expansion, and wealth creation of small firms--especially women- and 
minority-owned businesses--is inadequate capital.''
  Community Development Financial Institutions serve exactly these 
communities--with great success and economic benefit. In fact, a 2014 
report by the Darden School of Business at the University of Virginia 
found that despite serving predominately low-income markets, CDFI banks 
and credit unions had virtually the same level of performance as 
mainstream financial institutions. Despite this demonstrated success, 
CDFIs often lack the capital to meet the needs of many promising small 
businesses.
  In FY 2016 the total funding from applications to the CDFI Fund was 
four times greater than the resources available. Private sector 
investments are not enough to address the significant need for small 
business credit in underserved communities. CDFIs need access to 
capital now more than ever. Research shows that minority and low 
income-owned businesses typically encounter higher borrowing costs, 
receive smaller loans and see their loan applications rejected more 
often. The CDFI Fund is well-placed to provide struggling small 
businesses and entrepreneurs in underserved communities access to 
affordable credit through microloans.
  Let's give small businesses in underserved areas the tools they need 
to create jobs and develop their communities. I am pleased to introduce 
this bill, and urge my colleagues to join in support.