Date: 1981-05-12
Speaker: ST GERMAIN (democrat)
Chamber: H

Mr. Chairman. I applaud the actions of the House Appropriations Committee. for including the moneys for the National Consumer Cooperative Bank In this supplemental bill. The bank can now move a giant step toward selfsufficiency if the pending supplemental appropriations and rescission bill Is approved by the House. The bill. as reported by the Appropriations Committee. rejects efforts to rescind funds. previously appropriated by the Congress. to provide seed money for the bank. If the bank is assured the previously promised capital. it can move into the private markets for additional funds and start down the road to selfsufficiency as Congress intended when it created the bank in 1978. The capital provided the bank is repaid with interest by the cooperatives as they borrow from the Institution. Eventually. all capital will be repaid and the bank will become a totally selfsufficent private institution In the same manner as the entities of the farm credit system became private lending entities after returning every dime of the Treasurys capital. Support for. the Appropriations Committees action is Important not only for the millions of Americans who participate in consumer cooperatives. but to protect the Federal Governments Interest In caplta.1 already provided. Repayment Is assured if the bank Is allowed to remain a viable institution capitalized at a level sufficient to expand Its portfolio. and attract private Investors. Although in operation only a year. the bank has already approved nearly $100 million of loans to a variety of locally owned. locally. controlled cooperatives providing housing. food. and other consumer services. Interest In the bank has been phenomenal as consumers. faced with month after month of double digit Inflation. have seen cooperatives as a means of providing themselves choices and costcutting possibilities In the marketplace. Loans provided by the Coop Bank promote selfhelp efforts by local people who work together in their own neighborhoods. Congress should support this local Initiative and we are convinced that this type of bootstrap selfhelp will be all the more Important when Federal assistance programs are curtailed and eliminated through budget cuts. The National Consumer Cooperative Bank provides a highly cost efficient means of developing economic activity at the local level. The need for the bank. which some questioned when the original legislation was before the House. has been proven and today there are hundreds of millions of dollars of loan applications filed by.* citizenorganized- cooperatives in virtually every congressional district. Mr. Chairman. the SelfHelp Development Fund and Technical Assistance Office Is an essential part of the National Consumer Cooperative Bank. The $13 million provided by the Appropriations Committee for these functions is critically needed. These moneys will perform two important functions: First. Assure that newly developing cooperatives serving predominantly low- Income persons will have a source of funds available. The Self.Help Fund is authorized to adjust terms for these coops and this has a special meaning for Innercity areas and depressed rural areas. This Is very Important now that other programs are being cut for these areas. It is a highly costefficient method of delivering credit to these areas. These are loans. not grants. Second. The moneys also provided technical assistance for consumer cooperatives and this function helps protect the loans of the bank. It assures that cooperatives are set up on a businesslike basis and that they have the technical knowhow to meet the purposes of the cooperative. These are small sums. but highly important in protecting the Investments of the bank. Once again. Mr. Chairman. the selfhelp development program encourages local Initiative In local neighborhoods and we should encourage such activity. This Is a miniscule amount. but highly important to the bank and new coops across the Nation..