WASHINGTON — Two members of Congress used their speeches atNAFCU's Congressional Caucus to deliver news that advances thecause of raising the cap on member business loans.

Rep. Shelly Moore Capito, chairman of the House subcommittee onfinancial Institutions and consumer credit, said her panel willhold a hearing sometime in October on the legislation as partof  efforts to look at ways to jumpstart the economy andcreate more jobs.

Sen. Rand Paul (R-Ky.) said he would co-sponsor the measure inthe Senate.

Though Capito (R-W.Va.) will chair the hearing, she hasn'tcommitted to supporting the measure.

In an interview with Credit Union Times after herspeech, she said, “I will listen to what everyone has to say. Iwant to have some questions answered, including how many creditunions are coming up against the cap.”

The measure, which would raise the cap on member business loansfrom 12.25% of assets to up to 27.5% of assets, is sponsored in theHouse by Rep. Ed Royce (R-Calif.) and Rep. Carolyn McCarthy(D-N.Y.). Sen. Mark Udall (D-Colo.) has sponsored a companion billin the Senate.

Paul didn't mention the issue during his speech, which focusedon broader budget and spending issues, but announced his supportfor the measure in response to a question from the audience.

He said he had always supported raising the cap and checked withhis staff and it was an oversight that he hadn't signed on yet.

Under the bill, credit unions must be well-capitalized, be at orabove 80% of the current cap, have five or more years of memberbusiness lending experience and be able to demonstrate soundunderwriting and servicing. If a credit union's net worth ratiofalls below the well-capitalized requirement (currently 7%), itwould have to stop making new business loans.

The House bill has 69 co-sponsors and a companion bill by Sen.Mark Udall (D-Colo.) has 21 co-sponsors. 

In June, the Senate Banking Committee held a hearing on Udall'sbill, and NCUA Chairman Debbie Matz testified in support of it.

Capito also said her panel has passed several pieces oflegislation that would reduce the regulatory burden on creditunions and other financial institutions.

These measures, which include a restructuring of the ConsumerFinancial Protection Bureau, will “give some sanity to some of theregulations” that are out there, she said during her speech.

During his speech, Paul said Congress has to make seriousprogress toward tackling entitlements if the country is going tosolve its long-term debt problem. 

 Paul, who was elected to the Senate last year, wassupported by several credit union organizations during hiscampaign.