SBE Council Supports Bill that Prevents Direct Government Lending by SBA – Urges Improvement to Existing Programs

By SBE Council at 30 November, 2021, 12:59 pm

FOR IMMEDIATE RELEASE

Washington, D.C. - Small Business & Entrepreneurship Council (SBE Council) president & CEO Karen Kerrigan issued the following statement today, announcing the organization's support for legislation introduced by Rep. Blaine Luetkemeyer (R-MO), Ranking Member of the House Small Business Committee, that would "prohibit the Administrator of the Small Business Administration (SBA) from directly making loans under the 7(a) loan program, and for other purposes." The Build Back Better (BBB) Act that passed the House allows for direct government lending by the SBA. Kerrigan said:

"As we've repeatedly expressed to Congress and President Biden, policies need to support what is working and fix what is not. The current obsession with government doing everything and getting in the middle of everything, and in this case direct lending by the SBA, is not warranted and has the potential to backfire on the very small businesses the initiative aims to help.

"Improving upon and streamlining the existing - and successful - 7(a) program would be an effective approach to helping more small businesses access capital. In addition, Congress needs to examine and support other options that are working for historically disadvantaged businesses, such a regulated crowdfunding, to learn how innovative platforms are helping startups and local businesses access the capital they need to scale and compete.

"Emergency lending by the SBA in times of crisis is warranted at times, but direct lending would result in unintended fallout for taxpayers, small businesses and the community financial institutions that local businesses depend upon. Direct lending by the SBA is a bad idea. SBE Council fully supports Ranking Member Luetkemeyer and his colleagues in their work to advance legislation that prevents it from happening."

Ina media release distributed by the Ranking Member's office it was noted that all Republican members of the committee have cosponsored the legislation.

Contact:

Karen Kerrigan, [email protected]

SBE Council is nonpartisan advocacy, research and education organization dedicated to protecting small business and promoting entrepreneurship. For 27 years, SBE Council has worked on and advanced a range of private sector and public policy initiatives to strengthen the ecosystem for strong startup activity and small business growth. Visit www.sbecouncil.org for additional information. Twitter: @SBECouncil

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