New Challenges for Small Business

Meanwhile, Velzquez claims the number of SBA 7(a) loans are declining, having created “yet another barrier for small businesses that are already dealing with a myriad of challenges and high costs in today’s business environment.” A measure passed last June by the House “with strong bipartisan support” to restore funding for the 7(a) loan program was “vehemently opposed” by President Bush’s administration, she said. “These new lending figures paint a bleak picture for this nation’s main job creators – small businesses – as it is clear they are now facing serious difficulties in accessing capital,” said Velzquez who pushed for Congress to restore the 7(a) program’s funding back to Congress rather than having it operate at a zero subsidy. Stamler said the zero subsidy allows small business borrowers to access credit through the SBA “without having to worry any more about the temporary loan limits and periodic shutdowns caused by those limitations.” Last year, CUNA along with a dozen other trade groups, wrote Congress expressing concern over the SBA fee changes and their impact on lenders and borrowers. “Due to the higher fees, businesses are now being forced to pay as much as an additional $3,000 in upfront fees,” the groups wrote at the time in a letter to Honorable Jerry Lewis, chairman of the Committee on Appropriations and the Honorable David Obey, Ranking Member on the same Committee. Stamler said the agency is on pace in 2006 for the second biggest year for 7(a) in the program’s history. Both November and December 2005 were higher volume months than the same months a year ago, he added. “And the end of the year is the number that counts,” Stamler said. “We expect the numbers to be strong.” -