Here is some potentially good news for small business owners. President Bush announced a proposed FY 2009 budget package for the Small Business Administration this week. He is proposing an increase in lending capacity by 37 percent and increased funding for SBA’s ongoing operational reforms. This increase will support underserved markets as well as help with the internal running of the SBA.
The President proposes that the new budget of $657 million will be 15.5 percent over the 2008 budget with a 6 percent increase in the core operating budget. The total spending package will be $819 million, which will include anticipated carryover funds for disaster lending and other revenues.
The disaster assistance program has undergone major changes since Hurricane Katrina. More than 100,000 backlogged Katrina loans have been eliminated and more than $6 million have been put into the hands of the disaster victims.
SBA Administrator Steve Preston has stated that “This is a fiscally responsible budget proposal which supports SBA’s mission to foster small business growth and assist home and business owners affected by a major disaster.” He also said “The increased lending capacity will also allow us to provide more capital to small businesses, enhancing our ability to boost the economy.”
This new budget would authorize $7.5 billion for the Certified Development Company or 504 Loan Program, $17.5 billion for 7(a) Guaranteed Loan Programs and $3 billion for venture capital support under the Small Business Investment company program.
The new budget would also support training and mentoring programs for SBA employees; modernization of accounting and loan management systems, $250,000 for a competitive grant program for inner-city and rural entrepreneurial development and upgrading of the SBA’s information technology.
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