WASHINGTON - United States Senate Committee on Small Business and Entrepreneurship Chair Mary Landrieu, D-La., and Ranking Member Olympia J. Snowe, R-Maine, today commented on the Small Business Administration (SBA) components of President Barack Obama’s budget. The budget, also unveiled today, increases funding for the agency to approximately $700 million. Sens. Landrieu and Snowe are hopeful the additional funding will be spent on the most vital SBA programs after the agency’s funding was cut by 28 percent over the last eight years – the biggest cut of any federal agency.
“President Obama’s budget demonstrates that he will continue to make small business recovery a top priority,” Sen. Landrieu said. “Increasing the SBA’s budget, coupled with $730 million for the agency included in the American Recovery and Reinvestment Act passed earlier this year, will put the SBA in a much better position over the next two years as it works to assist the nation’s small businesses and entrepreneurs. We have a long way to go to recover from the deep cuts of the last Administration, but this is an important step in the right direction.
“While we are still awaiting details on where the additional funding will be spent, I am hopeful that it will go to important programs, such as small business lending, Women’s Business Centers, Small Business Development Centers, business assistance for veterans looking to start their own business, technical assistance for micro businesses and assistance to help small businesses – many of them owned by women, minorities and veterans – compete for and win federal contracts,” Sen. Landrieu said.
“While I am disappointed that the President’s proposed budget for the SBA does not fully restore the funding cuts of the last eight years, it is a welcome and refreshing change from the previous Administration’s SBA budget requests,” said Snowe.
“As former Chair and now Ranking Member of the Senate Committee on Small Business and Entrepreneurship, I have seen the devastating effects of the SBA’s budget cuts on our nation’s small businesses. While I am withholding full judgment until I am able to review the complete Fiscal Year 2010 budget, in order to see how President Obama recommends allocating additional funding, I am pleased that a new emphasis has been placed on helping our nation’s true job generators succeed. It is critical that the additional funds be allocated in a manner that will bolster the SBA’s core non-credit programs.
“I will continue to review the overall budget with a particular emphasis on its potential effects on small businesses to better determine its overall potential impacts on small businesses, including addressing the small business health insurance crisis – a top concern for small businesses across our nation.”
President Obama’s proposed budget recommends:
• Allowing the SBA to back $28 billion to expand credit availability, including $17.5 billion for the 7(a) loan guarantee program, $7.5 billion for the 504 loan guarantee program and $3 billion for the Small Business Investment Company (SBIC) program, which provides venture capital financing to small firms.
• Supporting $25 million in microloans, allowing intermediaries to provide small loans to entrepreneurs and start-ups.
• Strengthening tools to make the government a more effective partner for America’s entrepreneurs.
• Supporting $1.1 billion in direct disaster loans and setting aside $101 million to help run the disaster lending program. The budget also proposes to implement a pilot program to test the Guaranteed Disaster Loan Programs that Chair Landrieu, Ranking Member Snowe and former Chairman John Kerry, D-Mass., enacted as part of disaster reforms in the 2008 Farm Bill. This includes the Expedited Disaster Assistance Business Loan Program, which provides short-term bridge loans to impacted businesses and was championed by Sen. Landrieu following Hurricanes Katrina and Rita.
• Improving technical and contracting assistance to give entrepreneurs a greater level of counseling and business development expertise. This includes improvements to existing programs: Small Business Development Centers (SBDCs), Women’s Business Centers, SCORE and microloan assistance.
• Modernizing the core information systems within the Small Business Administration (SBA), streamlining loan processes and enhancing human capital resources.