FOR IMMEDIATE RELEASE
ICBA Calls for Passage of Improved Disaster Response Legislation
Washington, D.C. (April 12, 2007)—The Independent Community Bankers of America (ICBA) urges Congress to pass a pending bill to better enable community bank lenders and the Small Business Administration to respond effectively to disaster financing needs. Thanks to House Small Business Committee Chairwoman Nydia Velazquez (D-N.Y.), the full House will be considering the "Recover Act of 2007," H.R. 1361, which is a good start in reforming the troubled Small Business Administration's disaster lending efforts.
"Community banks know their customers best and support them, before, during, and well after a disaster strikes. The Recover Act is a good step in better integrating banks into SBA disaster lending and using the established relationships banks already have in their local communities," said James P. Ghiglieri, Jr. ICBA chairman and president of Alpha Community Bank, Toluca, Ill.
Notably, H.R. 1361 creates an "Enhanced Lending Program" that would permit SBA lenders to originate process, approve and service disaster loans for a fee.
The Recover Act would also:
- Require the SBA to develop and maintain a comprehensive disaster response plan.
- Increase the limits on business loans from $1.5 million to $3 million.
- Revise collateral requirements so that business owners are not required to pledge their homes for business loans less than $100,000.