WASHINGTON — In a draft report scheduled to be discussed at Senate oversight hearing today, the Small Business Administration's Office of the Inspector General criticizes the agency for canceling more than 7,700 "approved" disaster assistance loans to those business owners impacted by 2005′s deadly hurricanes.

The SBA said through its Accelerated Disaster Response Initiative, it tried to personally contact all 94,000 borrowers who were still in the system in September 2006. The OIG report focuses on the "Loan Triage" effort within the ADRI to reach 28,367 borrowers with approved loans that SBA had not heard from in several months and could not be disbursed because the borrowers had not submitted loan documents, according to SBA.

Last September, 28,367 approved disaster-assistance loans over 120 days old could not proceed because the applicants had not submitted closing documents, SBA said. Instead of canceling the loans, SBA's Buffalo Call Center was directed to contact every individual with an overdue loan application to determine how the agency could assist them.