Members of the Pendleton business community Friday told Oregon Sen. Jeff Merkley that loans are still tough to get and financial reform needs to make common sense.
The Democrat met with a dozen business owners and leaders during a closed-door session Friday at the Heritage Station Museum. With financial reform on the hot burner in Washington, D.C., Merkley told the group he needs to know the challenges small businesses face.
Several relayed stories of how projects are on hold because financing isn’t available.
Maryl Featherstone, owner and president of Graybeal Distributing, said she’s held off expanding her beer and wine distribution business because of the new federal heath care legislation and because Oregon voters approved higher taxes on the state’s wealthiest citizens and on businesses. That’s amounted to a $320,000 loss in cash flow, she said, that reduces the business’ ability to borrow.
Local hotel owner Vijay Patel said he has five hotel projects in the pipeline – four in Oregon – but no one is lending.
“As a small business person, I cannot grow,” Patel said.
Tom Moran, president and CEO of Community Bank, said Patel’s projects are well beyond the scope of his bank’s lending ability. And Norm Winters, also with Community Bank, said some federal programs to encourage lending include regulations that don’t help. Patel’s projects, for example, could qualify for a USDA loan, Winters said, if the hotels didn’t include pools.
That’s the kind of thing, he said, that shows the disconnect between lawmakers in the nation’s capitol and the consequences at the local level.
Merkley said financial reform needs firewalls to separate high-risk investing from lending so bad investments won’t take down the lending side of an institution. He also said lawmakers need to address conflicts of interests in financial institutions so people know where money is going. And there needs to be more regulations of prevent bad investments from creating a ripple effect in the economy.
“All these things are key to making lending work again back on Main Street,” Merkley said.
The senator also said financial reform won’t be the struggle heath care reform was.
“I think there’s bipartisan sense Wall Street rules need to be rewritten,” he said. “There’s some difference on how to do it, and we’ll have amendments that address those differences. But I think there’s an understanding that the status quo really broke down.”
The senator also said reform needs to be on the side of the American people.
“We need to make sure consumer financial contracts don’t have tricks and traps hidden on page 45,” Merkley said, “so that people can choose between fair options, knowing that they’re not being scammed.”
After Pendleton, Merkley headed to the Umatilla Chemical Depot to take a look and the future of the site after the military destroys the chemical weapons there. Saturday, the senator will hold a town hall meeting at 1:30 p.m. in Boardman and then another at 4:30 at the Pendleton High School.