Today’s meeting of the House Select Committee on Small Business featured Lt. Gov. Walter Dalton starting the meeting with a few words about what he heard from small business owners across the state over the last couple of years. A few comments of note included:
- Dalton shared a story from a small business owner begging for the state to reduce the regulatory burden on businesses, as this business owner had 17 visits from different regulators in one year.
- Dalton acknowledged that tax credits for small businesses won’t do any good to businesses not making money, as they wouldn’t have any tax burden anyway
- Dalton urged the General Assembly to “find more money for small businesses” this session – while not recommending where exactly they are to find it. He also noted that perhaps the biggest need for small businesses right now is access to loans.
Later in the meeting, a representative from the Coastal Federal Credit Union spoke. He revealed that, in spite of the credit crunch still afflicting most commercial banks, credit unions “have money” – but thanks to federal restrictions on the portion of their capital that is allowed to be loaned out to businesses, they have very little loanable funds left for small businesses. He urged state lawmakers to contact North Carolina’s federal representatives and ask that the credit unions be allowed to loan more funds to businesses, or as he put it: “let us lend it (the money).” He mentioned that if the federal regulations were liberalized a bit, credit unions in North Carolina could provide hundreds of millions of capital to small businesses across the state.
So here we have a situation in which small businesses are thirsty for capital, while credit unions are longing to loan more capital to small businesses. What’s keeping them from meeting each other’s needs?
The federal government, of course.
Francis De Luca says
Of course the fact that they have a tax status from the federal government that gives them a competitive advantage over commercial banks has nothing to do with them having extra dollars. They could lower the rate they charge people on home loans and put some of that money back in the economy and help stabilize the housing market with no federal action…