House Salvages Important Small Business Program

Date: 07/08/04

HOUSE SALVAGES IMPORTANT SMALL BUSINESS PROGRAM

The U.S. House of Representatives overwhelmingly approved funding of the Small Business Administration's 7(a) small business lending program on Thursday. The measure, added as an amendment to the Commerce, Justice, State, the Judiciary and Related Agencies appropriations bill, will provide over $79 million for the loan guarantee program.

WASHINGTON, D.C. - - The U.S. House of Representatives overwhelmingly approved funding of the Small Business Administration's 7(a) small business lending program on Thursday. The measure, added as an amendment to the Commerce, Justice, State, the Judiciary and Related Agencies appropriations bill, will provide over $79 million for the loan guarantee program.

"If our economy is to sustain its current momentum, small businesses must be given every opportunity to succeed," said Hulshof. "It is imperative that the federal government provide necessary resources for the entrepreneurs and risk-takers in our country. I'm pleased my colleagues have recognized the importance of this vital program."

The 7(a) General Business Loan Program provides loan guarantees to eligible small businesses that have been unsuccessful in obtaining private financing on reasonable terms through usual channels. The program operates through private-sector lenders that provide loans, which are then guaranteed by the SBA.

The 7(a) program has achieved widespread success and now provides 30 percent of all long-term, small business financing. It is the SBA's largest and most important program in terms of number of loans and program level supported.

When combined with an extension of the current fee structure, the FY 2005 funding level will supply nearly $12.5 billion in financing for small businesses.

"Failure to extend this important program would have put undue burden on small business owners," added Hulshof. "Small businesses employ over fifty percent of our nation's workforce. It's important that we continue to take the necessary steps to create jobs, and preserving this source of capital for small businesses will help meet this goal," he concluded.