UPDATE 1-Obama unveils plan to boost small business credit

* President focuses on Small Business Administration

* Senate set to open debate on series of employment bills

* Mixed jobs numbers no cause for celebration – Obama
(New throughout, changes dateline, adds byline)

By Ross Colvin

LANHAM, Md, Feb 5 (BestGrowthStock) – President Barack Obama,
looking for ways to drive down high U.S. unemployment in an
election year, on Friday proposed to expand credit for small
businesses and urged Congress pass laws to boost jobs.

“What I hope — what I strongly urge — is that we work
quickly and we work together to get this done. America’s small
businesses are counting on us,” Obama told a gathering of small
business owners near Washington.

Obama proposed Congress temporarily expand credit through
two Small Business Administration programs, the latest in a
series of White House efforts to improve the flow of credit to
small businesses, which are a core source of new U.S. jobs.

His plan could become part of fresh legislation to aid U.S.
employment percolating in Congress — on top of a $787 billion
stimulus package that Obama signed in February 2009. Or
lawmakers could opt to go with their own ideas.

The U.S. Senate will begin debate next week on a series of
bills to boost employment. The House of Representatives already
passed a $155 billion jobs package in December.

U.S. unemployment dipped to 9.7 percent in January, the
lowest reading since September 2009, but the economy still shed
another 20,000 jobs and Obama said these somewhat mixed numbers
“are a cause for hope but not celebration.” [ID:nN04115255]

U.S. growth jumped at a 5.7 percent annual pace in the
fourth quarter but the recovery is still fragile. As a result,
the White House wants to continue to stimulate activity with
fiscal policy and prevent a double-dip recession.

ELIGIBILITY RESTRICTIONS

Obama’s latest proposal to aid small business credit
involved expanding an existing SBA program to support
refinancing of owner-occupied commercial real estate loans.

The White House estimates the plan would help refinance up
to $18.7 billion worth of commercial real estate per year that
might otherwise be foreclosed and liquidated.

To be eligible, small businesses must have certain types of
first mortgage loans maturing within the next year. Firms would
have to be current on payments for the previous year.

Obama also proposed a temporary increase in the cap on SBA
Express loans to $1 million from $350,000. The added cost would
largely be covered by fees, a White House official said.

The official said expanding the loan size would help a
broader range of small businesses.

Announcement of the two programs comes just days after
Obama proposed using $30 billion from the TARP bank bailout
program to create a lending fund for small businesses.

He has also suggested a $33 billion tax credit for small
businesses that hire new workers, or increase the size of their
payrolls by paying people more money in 2010.

Other elements of the Senate’s “jobs agenda” include
extending unemployment insurance and aid to cash-strapped
states, tax credits for businesses that buy new equipment, and
incentives to weatherize homes that would also save energy.

Investing Analysis

(Writing by David Alexander and Alister Bull; Editing by
Xavier Briand)

UPDATE 1-Obama unveils plan to boost small business credit