Calls to Congress to Free Up Capital for Viable, Low Risk Projects

Today, the Associated Builders and Contractors Inc. (ABC ) and the Independent Community Bankers of America (ICBA) sent a joint letter to members of the U.S. House and Senate on the issue of small business lending. Contractors and builders need money to fund new projects, and these two associations are looking for leadership from congress. Read their insightful thoughts below:

Dear Representative:

On behalf of Associated Builders and Contractors Inc. (ABC) and the Independent Community Bankers of America (ICBA), we write to express our deep and ongoing concerns about the difficult capital and lending environment for America’s small businesses.

Throughout the economic crisis, ABC and ICBA have called on Congress to support policies that promote small-business lending and job creation. Access to capital continues to be a major concern for America’s small-business entrepreneurs. Tax policy uncertainty and a more oppressive regulatory environment have made it even more difficult to fund private sector projects. With the construction industry unemployment rate at 20.7 percent and a loss of nearly 1.9 million construction jobs since December 2007, policies that foster job creation and economic growth must remain a top priority.

Many ABC members have viable, low risk projects and/or contracts that simply need funding in order for work to commence. Generally, ABC small business owners rely on community banks for capital. During the crisis, it has been a priority for community banks to remain committed to serving local small businesses. However, community banks are facing the toughest regulatory environment in decades. Although community banks were not part of the risky lending practices that led to the financial crisis, federal banking agencies are over-regulating the community banking sector and jeopardizing lending. As a result, many community banks are hampered in their ability to support full funding for qualified small business customers that have received loans in the past.

ABC and ICBA both agree that overly burdensome federal regulations negatively impact the economy. We support a return to a more balanced regulatory environment that would allow community banks to continue to serve the needs of their local customers—small businesses. In fact, community banks support 31 percent of all small business loans that are less than $1 million. During this time of economic recovery, it is critical that small businesses have access to such funds.

Small businesses are the backbone of our economy and give Americans a sense of pride and accomplishment in our country. Many community banks have relationships with small construction firms and are anxious to make good loans in order to spur job creation.

During the 112th Congress, ABC and ICBA look forward to working with you as you develop initiatives to best support small business lending and economic growth.

Sincerely,

M. Kirk Pickerel
President and CEO
Associated Builders

Camden R. Fine
President and CEO
Independent Community Bankers
and Contractors of America