(Washington, DC) – Today, Senate Small Business and Entrepreneurship Committee Chairman Jim Risch (R-ID), House Small Business Committee Chairman Steve Chabot (R-OH) and respective Ranking Members Jeanne Shaheen (D-NH) and Nydia Velázquez (D-NY) joined together to introduce the Small Business 7(a) Lending Oversight and Reform Act of 2018. This bipartisan, bicameral legislation will increase the Small Business Administration’s (SBA) oversight authority over the 7(a) loan program.
Senator Shaheen said: “SBA’s 7(a) program provides an essential source of capital to help New Hampshire small businesses that don’t qualify for a traditional bank loan – at no cost to taxpayers. This bipartisan bill ensures that small businesses will not be hurt by a sudden shutdown of the program and left without an affordable source of capital to meet payroll, buy inventory, purchase equipment and create jobs in their community. It also takes important steps to improve oversight of the program to prevent fraud and increase efficiency. I look forward to working with my colleagues and SBA to make sure this program works for New Hampshire small businesses.”
“The 7(a) loan program has leveraged billions of dollars to help America’s small businesses thrive,” said Senator Risch. “By bolstering the SBA’s oversight office and providing the Administrator with flexibility to increase the program’s maximum lending authority in the event it would be reached, this bill will ensure the strength of the program into the future, guaranteeing that entrepreneurs will have access to the critical capital they need to build and grow their businesses. The bipartisan and bicameral support for this effort underscores just how important the 7(a) program, and the capital it provides, is to our nation’s small business owners. I look forward to working with my colleagues to advance this legislation.”
“Many small business owners are ready to turn their dream into a reality but face obstacles to finance it. One of the many ways they are able to get the capital they need is the 7(a) loan program. This legislation will allow SBA to keep a close watch on the program to ensure it is running efficiently and effectively while also protecting taxpayer dollars,” said Chairman Chabot.
Rep. Velázquez said: “The House Small Business Committee has a long tradition of working across the aisle to promote opportunity and job growth for America’s small businesses and, central to that effort, is ensuring entrepreneurs can access adequate capital to grow their operations. To that end, I’m proud to cosponsor the Small Business 7(a) Lending Oversight Reform Act, a package of bipartisan, commonsense reforms to increase the efficiency and reach of the program. Since its inception, the 7(a) initiative has provided new and existing ventures with financing to grow and create jobs in local communities. Under this legislation, SBA will have more tools to meet small businesses’ needs. I’m particularly pleased the bill includes provisions from my legislation allowing SBA to raise its 7(a) lending cap, so there’s no interruption in the flow of loans to small firms. This is a good bill and I look forward to working with Chairmen Chabot and Risch and Ranking Member Shaheen in seeing it enacted.”
The 7(a) loan program is a Small Business Administration (SBA) program that helps entrepreneurs and small businesses access credit to start and grow their businesses. The Small Business 7(a) Lending Oversight and Reform Act of 2018 preserves this important loan program by:
- Strengthening SBA’s Office of Credit Risk Management by outlining in statute the responsibilities of the office and the requirements of its director;
- Enhancing SBA’s lender oversight review process, including increasing the office’s enforcement options;
- Requiring SBA to detail its oversight budget and perform a full risk analysis of the program on an annual basis;
- Strengthening SBA’s Credit Elsewhere Test by clarifying the factors that must be considered.
The Small Business Committees have held multiple hearings on the matter and several meetings to ensure the program continues to run effectively and with proper oversight.