Sen. Evan Bayh is calling for the elimination of fees charged to small businesses that obtain loans from the federal government.

Bayh came to Evansville on Tuesday to speak at a jobs fair held in the C.K. Newsome Center. While there, the senator called for repealing the fees, saying they impede small businesses from getting loans they desperately need.

Many entrepreneurs, he explained, find that banks won’t give them loans unless the U.S. Small Business Administration guarantees that money will be paid back. But in order to obtain such a guarantee, a business must often pay the government a fee.

Bayh said that obstacle should be eliminated — a step that is not without precedent. After the terrorist attacks on Sept. 11, the fees were done away with only to be allowed to return several years later.

Connor Agnew, the owner of a new consulting firm in Evansville, said he thinks the proposal will help many owners of small businesses. He himself has not taken out a loan yet and doubted the government’s fees will prove a great obstacle.

But they do, no doubt, to many others.

“It’s going to have a ripple effect because a lot depends on these industries,” Agnew said.

Bayh estimated eliminating the fees would cause the Small Business Administration to issue about $190 million in additional loans to Indiana companies. That could lead to the establishment of about 5,700 more jobs in the state.

Bayh, a member of the Senate’s committee on small business and entrepreneurship, said his proposal is not part of the $700 billion bailout, which he helped to approve. Nor does it have anything to do with the latest decision to inject about $250 billion into troubled banks.

Although both of those plans will eventually trickle down to common people, Bayh said, many in the public perceive them as giving direct aid to the rich. His proposal to eliminate the fees, though, is clearly aimed at helping owners of small businesses.

He estimated the proposed change will cost about $700 million. The federal government could easily afford that amount by eliminating spending on pork projects, he said.

###