VIA FACSMILIE (202) 224-3416 January 3, 2011
The Honorable Richard Shelby United States Senate 304 Russell Building Washington, DC 20510 Dear Senator Shelby: On behalf of the League of Southeastern Credit Unions, the 311 credit unions we represent in Alabama and Florida, and the more than 6.3 million members they serve, I am writing to express our strong disappointment that you objected to unanimous consent consideration of Senator Mark Udall’s Small Business Lending Enhancement Act. As you know, increasing the authority of credit unions to make small business loans to their members has long been a legislative priority of the credit union movement. As a result of the recent recession and banks unwilling or unable to lend, many small businesses have turned to credit unions for small business loans. Unfortunately, the current cap of 12.25% of assets has resulted in many credit unions not investing in the resources needed to make member business loans, while those that do make such loans may find themselves at the upper limits of the current cap. The result is less credit being available to small businesses, at a time when they need it the most. Senator Udall’s bill represented the best hope Congress, working with American’s credit unions, to help small businesses meet their increased need for capital. This, in turn, would have been a much-needed stimulus for the nation’s economy. Simply raising the current limit to 25% would have made $10 billion in small business credit available in the first year of the bill’s enactment. Conservatively estimated, this would create over 1,100 new jobs, many of them right here in Alabama. At a time when Congress debates multi-billion taxpayer funded stimulus programs, and $30 billion bailouts to community banks for small business lending, freeing up $10 billion in small business capital at no cost to the American taxpayer seems like an obvious component of any recovery plan. I understand that the Republicans are frustrated with some of tactics of the majority during this lame duck session, and how you see them as pushing controversial legislative initiatives to a vote outside the normal process. While objecting to unanimous consent may be the correct course of action for a controversial piece of legislation that comes to the floor outside the normal legislative process, we do not believe this is the case with credit union member business lending legislation. Senator Udall’s bill is not a new initiative, and has been either a freestanding bill or a part of other legislation since 2006. Credit unions, and other groups supporting Senator Udall’s bill including Americans for Tax Reform, the Competitive Enterprise Institute, the National Small Business Association, the National Association of Manufacturers, and the National Association of Realtors have all expressed their support for this bill and the policy reasons for it to members of the Senate. It is hard to imagine that there is anyone on
Capitol Hill who is unfamiliar with the bill or the reasons for supporting it. It is equally difficult to think of a single policy argument against allowing credit unions the ability to help small businesses in their communities. We are therefore extremely disappointed at the idea that politics, not policy, could have been the cause of the Senate’s failure to take up the measure. For the small businesses that are asking their credit unions for help, and for the credit unions that may now be forced to turn them away, an explanation of the importance of Senate process will ring very hollow. Credit unions have always appreciated our relationship with you, your support, and your work to ensure a sound operating environment for credit unions and their efforts to best serve the financial needs of their members. That is why your objection to Senator Udall’s bill came as such a surprise and disappointment. While we understand that you objected to the process by which the bill was brought to the Senate floor, we deeply regret that you chose to simply object to unanimous consent thereby killing any chance of passage during the 111th Congress. We hope that as we begin the 112th Congress in January, that you will consider the merits of this bill, and that credit unions, small businesses around the country, and the men and women they employ can look to you for your support of this legislation. I look forward to your response and would welcome the opportunity to discuss this issue directly with you. Sincerely,
Patrick La Pine, President and CEO League of Southeastern Credit Unions