SBA Lending Program Gets Cash Influx, Restarts Popular Program

Thanks to an infusion of $470 million from Congress on Tuesday, the Small Business Administration was able to restart its popular 7(a) loan guarantee program, which was shut down earlier this month due to a lack of funding.

The SBA’s program is caught in the middle of some unusually rancorous political haggling over the federal budget, which has left a number of agencies — including the SBA — operating without funding for the fiscal year that began Oct. 1. Without its appropriation, the agency had no choice but to suspend the program. This new infusion of cash keeps the program running at least through Jan. 31.

The SBA oversees loan guarantees for companies that don’t qualify for traditional bank loans. The agency blames the delay on Congress, which has yet to vote on a $373 billion spending bill that includes SBA funding.

The agency had been operating in the meantime under a temporary authority based on 2002 spending levels while requests for SBA loans have were coming in at record rates, as much as $45 million per day, which was way above the funding the agency has for the program, spokesperson Sue Hensley told the Associated Press earlier this month. At that time, the agency took steps to place a $750,000 maximum limit on the loans it would guarantee, which is down from $2 million.

Tony Wilkinson, president and CEO of the National Association of Government Guaranteed Lenders, cited SBA estimates that the 7(a) program created 350,000 jobs last year, Minnesota’s Pioneer Press reported.

You may like these other stories...

Tesco says it overstated profit forecastStanley Reed of the New York Times reported that Tesco, the large British grocery retailer, disclosed on Monday that it had overstated its expected half-year profit by about $400...
The Public Company Accounting Oversight Board (PCAOB) on Monday reminded auditors that they should continue adhering to the board’s existing standards when considering an organization’s ability to operate as a...
Exclusive: Lois Lerner breaks silenceIn her first press interview since the IRS Tea Party targeting scandal broke 16 months ago, ex-agency official Lois Lerner told Politico that employers won’t hire her, she’s...

Already a member? log in here.

Upcoming CPE Webinars

Sep 24
In this jam-packed presentation Excel expert David Ringstrom, CPA will give you a crash-course in creating spreadsheet-based dashboards. A dashboard condenses large amounts of data into a compact space, yet enables the end user to easily drill down into details when warranted.
Sep 30
This webcast will include discussions of important issues in SSARS No. 19 and the current status of proposed changes by the Accounting and Review Services Committee in these statements.
Oct 21
Kristen Rampe will share how to speak and write more effectively by understanding your own and your audience's communication style.
Oct 23
Amber Setter will show the value of leadership assessments as tools for individual and organizational leadership development initiatives.