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SBA's small business loan programs receive
significant boost
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President Bush signs bill making more than $21
billion in loan financing available; agency programs also reauthorized
[DEC. 9, 2004]
WASHINGTON -- President
George W. Bush signed legislation Wednesday making more than $21
billion available to small businesses through the Small Business
Administration's two main loan programs. The legislation also
reauthorizes the agency's programs and provides a $580 million
budget for fiscal 2005.
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The SBA's flagship 7(a) loan guarantee
program was boosted to a $16 billion level, $3.5 billion above what
the program provided last fiscal year, when a record $12.55 billion
in financing was made to small business. Additionally, the
government loan guarantee increased from $1 million to $1.5 million,
and the program will now operate without a congressional
appropriation, or at zero subsidy, meaning that the program will be
self-supported through modest fees paid by lenders and borrowers.
An additional enhancement to the
7(a) program was Congress' action to make the popular SBAExpress
program permanent, raising the maximum loan size to $350,000 with a
50 percent government guarantee.
"I would like to thank Senator Frist,
Speaker Hastert and Small Business Committee chairs Snowe and
Manzullo, and our banking partners for working with the
administration to strengthen the 7(a) program," said SBA
Administrator Hector V. Barreto. "This is an important win for small
businesses and will ensure long-term stability to the program."
Congressional action included
expanding the agency's 504 loan program up to the $5 billion level
and raising the maximum loan size for manufacturers to $4 million.
The 504 loans may be used for the purchase of real estate, buildings
and machinery.
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Other highlights in the bill include
$3.250 billion for SBIC debenture financing and funding for the
microloan and HUBZone programs. The SBA's disaster program,
instrumental in the assistance provided after the rash of hurricanes
this past summer, previously received supplemental funding.
In the area of entrepreneurial
development, the Small Business Development, SCORE and Women's
Business Centers were reauthorized and funded at the same levels as
last year. The bill also provides funding for the programs for
veterans and Native Americans.
"The SBA had a record-breaking year
in the number of loans and technical assistance it provided to
entrepreneurs last year, and we're poised to do even better this
year, particularly in our loan programs," Barreto said. "Under
President Bush's leadership, we will continue to move in a direction
of more efficient and effective delivery of our products and
services. In the long term this is good for the American taxpayer
and for small businesses."
[Small
Business Administration news release
provided by Donald Pellico] |
