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SHARON BERNSTEIN and LISA MASCARO Tribune Washington Bureau WASHINGTON — Small businesses desperate for government help getting loans will have to wait at least until September before Congress moves on long-awaited legislation to pay for higher loan guarantees, lower fees and other breaks. As the Senate adjourned for its summer recess last week, a key bill to spur lending to small businesses remained stuck in a partisan stalemate. As a result, the next month or more may be angst-ridden for many business owners. Nationwide, 995 government-backed small business loans that have been given initial approved since last spring are now stuck in limbo until Congress acts. Still other small firms are struggling to secure loans from banks and other lenders — but those are harder to get now that federal support has dried up. “Something has to be done,” said Usha Villarreal, who had to pay $11,000 in extra borrowing fees after her government-guaranteed loan to expand her Mission Viejo, Calif., assisted living business got held up. “Our only other option was to wait in line, and there were 136 other applications ahead of us.” Senate Democrats vowed last week to take up the measure again when lawmakers return to work next month. but they acknowledged it may be difficult to break an ongoing Republican filibuster of the bill, which is caught in partisan squabbling despite its broad popularity. “We will have to fight this out a step at a time,” said Sen. Mary Landrieu, D-La., the bill’s author. For five weeks, progress on the bill had been stalled in the Senate, interrupted by other business and punctuated by bitter infighting.

Landrieu held forth at all hours on the chamber floor, frequently pressing her case late into the night for the small businesses that both parties promote as an engine of the economic recovery. “If we don’t get small business started up again and focus on them and help them, this recession will never come to an end,” she said. The package of small business proposals before the Senate includes money to allow the Small Business Administration to guarantee up to 90 percent of loans made by banks and community lenders to small businesses. Most SBA loans are now available with guarantees of only 50 percent to 75 percent, making them riskier and less attractive to lenders. The SBA would be allowed to waive points and other fees and reduce down payments on many loans, and set up a fund to provide $30 billion to stimulate small business lending by community banks. The House has already passed the measures, but they have been stuck in increasingly bitter wrangling in the Senate. Funds to support the SBA guarantees and fee reductions ran out in may and lending to small businesses has dropped precipitously since. The small business loan assistance ran into trouble in the Senate when members from both parties began attaching amendments to support their favored causes. Send Question/Comment to the Publisher Note: This will not appear in the “comments” section. Please see below to post a comment to the story As lending bill enters limbo, so do businesses