House approves fund to manage federal small-business credit dollars

The Utah House on March 8 approved Senate Bill 198 to create an enterprise fund to manage federal dollars intended to expand lending to small businesses and manufacturers.

Representative L. Schroer, the House sponsor, told colleagues the bill establishes the State Small Business Credit Initiative Program Fund and gives the Division of Housing and Community Development authority to receive and spend federal revenues tied to the federal Small Business Jobs Act of 2010. He said about $13,000,000 in federal allocation is expected by June 2011 and that, over several years, those funds could be leveraged to roughly $130,000,000 through matching and private leverage arrangements, with no state general-fund contribution required.

"These funds are to leverage private lending to help finance small businesses," Schroer said, summarizing the program’s purpose and management role.

Representative Nielsen questioned the fiscal note and the source of the $20,000,000 referenced in committee material; Schroer said the $13,000,000 federal allocation is expected and additional contributions could come from interest, donations or other grant or transfer authorities described in the bill.

Supporters said the program would expand access to credit for firms that otherwise cannot get financing and could help create jobs. Opponents who voted no raised fiscal and oversight concerns during floor discussion but the House approved the bill 54 yes to 16 no. The bill will be signed by the Speaker Pro Tem and transmitted to the Senate for the President’s signature.

The House record shows the bill was presented and discussed on the floor and voting concluded with the reported tally; next procedural steps are signature and return to the Senate.