President's Budget Backs $28 Billion in Small Business Loan Guarantees
President Barack Obama's fiscal year 2010 budget overview offers full support for the U.S. Small Business Administration's credit programs, authorizing SBA to support loan guarantees of $28 billion to small businesses. The SBA recently summarized the small business highlights of the budget plan.
The budget overview provides a broad outline of the president's budget priorities, including an appropriation for SBA of approximately $700 million. The full budget proposal with account level appropriation details is scheduled for release in April.
The spending cited in the broad proposal would be in addition to the $730 million funding provided for SBA credit programs in the recently enacted Recovery Act. That Act - for which most spending is targeted for use in 2009 and 2010 - authorizes the SBA to raise guarantee percentages on some SBA loans to 90 percent. It also temporarily reduces fees on SBA-backed loans, expands funding for Microloans, and raises the maximum size of SBA-guaranteed surety bonds.
The bill outlines maximum authorization levels for SBA credit programs well above current demand for those programs. It sets a maximum of:
- $17.5 billion for SBA's 7(a) General Business Loan Guarantee program
- $7.5 billion for the 504 Certified Development Company Loan program
- $3 billion for the Small Business Investment Company debenture program
- $25 million for the Microloan program.
The bill also provides for $1.1 billion in direct disaster loans, and provides for the launch of a pilot program to test the use of SBA-guaranteed loans as part of the agency's response to disaster declarations.
In addition to those credit provisions, the proposal:
- sustains funding for the agency's technical assistance and training programs
- improves federal contracting data and continues reviews of small business size standards to help
- improve targeting of federal contracting opportunities for small businesses
- modernizes core agency information systems
- streamlines loan processes
- enhances human capital resources
The budget overview also includes the Obama administration's Small Business and Community Bank Lending Initiative. It expands small business credit availability and affordability by unfreezing secondary markets for small business loans as part of the larger plan to revive the flow of credit in the economy.
- Related items:
- IRS Decides To Be Generous with Credit for New Homebuyers
- Congress Approves Massive Spending Bill Along Party Lines
- Senate Finance Approves "Stimulus" Package with AMT Patch
- White House Stands Firm on $500 Tax Credit in Economic "Stimulus" Package
- Obama, House Democrats Unveil $825 Billion Economic Stimulus Bill
- President-elect, Congressional Leaders Strive for Swift Action on Stimulus Plan
- Lawmakers May Deliver Small Business Tax, Pension Relief Before Year-End
- Congress Passes Tax Extenders as Part of Bailout Bill
Posted March 12, 2009.
|
