Neb. small-business owners say banks are slow to lend and the government is not helping them

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Neb. small-business owners say they get no help

OMAHA, Neb. — The weak economy continues to strain small businesses, and owners of those firms say neither government stimulus programs nor banks are offering much help.

Mark Roseland, president of Backlund Plumbing in Omaha, said there doesn’t seem to be help available for smaller businesses like his, although big companies have received billions from the government.

“There’s no help for us on the low end,” said Roseland, who is trying to avoid laying off any of his 50 employees.

Roseland was one of about 50 small-business owners who gathered Tuesday in Omaha to discuss their frustrations. The business owners hope to get the attention of Congress, which is considering a new jobs bill. President Barack Obama has proposed including a tax credit for small businesses to encourage job creation, but critics have questioned whether that idea is too complicated to be effective.

Larry Richling owns several diners and some apartment buildings around Omaha. He says it seems the banks are constantly changing the rules on how and to whom they will lend money — and that they remain reluctant to lend to small businesses.

“2009 was a year when we all hung on by our fingernails. What’s 2010 going to be?” said Richling, who recently lost his home to foreclosure because he decided last year to use his money for payroll instead of his mortgage.

Roseland agreed that it is difficult to obtain financing from banks.

“I’ve never been turned down, but the hoops to jump through are getting smaller and smaller,” Roseland said.

Several of the business owners at Tuesday’s forum suggested the government may have to step into the commercial real estate market to get things moving as it has in residential real estate with tax credits.

The economy will suffer if the commercial real estate market remains slow. That could increase the chances of a situation several business owners said they had already experienced, in which properties are appraised for significantly less than the banks originally estimated when making loans, prompting the banks to call for the loans to be paid in full.

Developer John Hoich said a strip mall he built in northwest Omaha was appraised a year ago for roughly $5 million, but it was recently reappraised at $2.6 million even though the building is 25 percent occupied and on land worth $1.5 million.

If those valuations stand, Hoich warned it could cripple development in the area.

“It’s going to kill our economy,” Hoich said.

U.S. Rep. Lee Terry served as the target for the business owners’ complaints at Tuesday’s forum, but the Omaha Republican readily agreed with most of the business owners’ comments. He said too much of the government’s efforts to help the economy has been focused on expanding government programs instead of helping small businesses.

“Nationally, as well as in Omaha, small businesses are the backbone of the U.S. economy,” Terry said.

Small businesses account for roughly half of all private-sector workers and have created roughly half of the nation’s jobs over the past decade.