Kerry: Republicans Diss Small Business in Approved $388 Billion Bill

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Republicans Raise Fees on Small Business Borrowers Says Kerry

Republican majority eliminated all funding and increased fees for the largest source of small business loans in the country

Republicans Raise Fees on Small Business Borrowers Says Kerry

11/22/2004 1:13:00 PM

WASHINGTON, Nov. 22 /U.S. Newswire/

http://releases.usnewswire.com/GetRelease.asp?id=40054

"Republican leaders in Congress have rubber-stamped a proposal by President Bush that makes it even harder for small businesses to borrow money in America. That is simply wrong," said Sen. John Kerry, Ranking Democrat on the Small Business and Entrepreneurship Committee. "Once again, they're putting the costs of lending on the backs of small businesses -- the backbone of our economy and the very enterprises we're supposed to be helping."

Background:

President Bush requested, for the second time in four years, to eliminate all funding for the SBA's largest lending program, shifting the cost to small business borrowers and lenders. In fiscal year 2002, the Congress rejected the President's plan and restored funding. This fiscal year, the House and Senate again rejected the plan, voting to provide $79 million in the House and $70 million in the Senate, only to see the money disappear in late-night deals controlled by the Republican leadership and the White House.

Eliminating funding for the 7(a) program shifts more than $70 million in costs to small business borrowers and lenders that have already overpaid more than $1 billion in fees since 1992. The Republican plan doubles fees on the smallest borrowers. Small businesses seeking mid-sized loans will now face a 20 percent increase in fees. And for the very largest loans, those with guarantees over $1 million, there is an additional tax of 0.25 percent. And although the SBA's 504 loan program is structured as combination loans, the Republican plan prohibited combination loans in the 7(a) loan program. These loans are important to mid-size businesses such as restaurants, small hotels, franchises and other small businesses that are members of the U.S. Chamber of Commerce, Women Impacting Public Policy, the American Bankers of Association, and the Independent Community Bankers of America.

In FY2004, the SBA's 7(a) loan program financed almost 75,000 small businesses, pumping $12.5 billion into our local economies. This financing created or saved an estimated 379,000 jobs. The Administration contends that shifting the cost to the small business community will provide stability for the program because it will no longer rely on appropriations; however, the problem has stemmed not from appropriations, but from the Administration's budget gimmicks and inaccurate accounting/subsidy rates. In fiscal year 2004 alone, the Administration's miscalculations led to a mid-year change in the subsidy rate, keeping 1,500 small businesses from getting loans.


Contact: Catherine Scott, 202-224-8496, or April Boyd, 202-224-4159, both of Senate Committee on Small Business and Entrepreneurship
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Related:

Congress Passes Kerry Initiative for Women in Business

11/22/2004 12:48:00 PM

WASHINGTON, Nov. 22 /U.S. Newswire/ -- As part of its fiscal year 2005 omnibus spending package, Congress today passed an initiative introduced by Sen. John Kerry (D-Mass.) to safeguard the nationwide network of Women's Business Centers funded through the Small Business Administration (SBA).

"Supporting the most effective and experienced Women's Business Centers is one of the best ways to increase opportunities for women in business," said Kerry, Ranking Democrat on the Committee on Small Business and Entrepreneurship. "The Women's Business Center network reached over 122,000 clients this year, up from 8,000 in 1999, and continues to exceed its goals. Supporting these centers is important to job creation, to local economies and to women-owned businesses nationwide."

The Kerry initiative included in the omnibus bill increases the amount of funding reserved for sustainability centers, the most experienced women's business centers, to 48 percent. The increase corrects the SBA's outdated funding formula to account for the greater number of women's business centers that are in the "sustainability" phase of the program. These "sustainability" centers make up about half of the total centers, but currently receive less than a third of the program's funds.

Introduced by Kerry on March 9, 2004, the SBA Emergency Authorization Extension Act of 2004, S.2186, contained similar language making the 48 percent change.

http://releases.usnewswire.com/GetRelease.asp?id=40053

[Goldeneye]

1. I wouldn't mind hearing Kerry

use the word "diss."

[Deja Q]

2. Gee Kerry, whatchagonnado?

You quickly cowarded out of Election 2004 after making a brave noise about not surrendering.

Why should I believe you now?

BTW: BIG business is the backbone of this country. Has been for 20-some years. ALL politicians make a sham of a joke of an atrocity of a sham out of pitching 'small business support'. And here's the proof: If small business really WAS a concern over the last couple of decades, the government would help them and bar the big corporations from getting bigger. But the OPPOSITE has occurred. Big biz has more power, small biz gets choked. That's how it is. And both sides are guilty of tightening the grip.

[sangh0]

4. If small business really WAS a concern

you'd have commented on it, but I guess everyone has their priorities

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7. What are YOU going to do?

Kerry is chair of the Senate Small Business Committee.

Unbelievable ignorance on this board from some.

[havocmom]

3. Every American working for a small business who has to put up with a

neocon-supporting boss who likes to push their politics around the work place should copy this newswire and mail it to their bosses!

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5. WHY ISN'T KERRY DOING ANYTHING??????!!!!

:)

[Verve]

6. Does anyone know when this funding elimination with the SBA 7a loans

take effect? Ironically, my husband is waiting on a 7 a loan this week. The loan has already been approved by the bank but it now has to go back to SBA. They are supposedly closing by the end of the month. Please don't tell me this takes effect soon!

[bigtree]

8. Contact:

Catherine Scott, 202-224-8496, or April Boyd, 202-224-4159, both of Senate Committee on Small Business and Entrepreneurship

These folks or their staff will be more than happy to discuss the status of the funding and what you can do to help.

SBA's Office of Women's Business Ownership
http://www.onlinewbc.gov/

SBA Federal Government WWW Servers
http://www.sba.gov/world/federal-servers.html

Small Business Administration
http://www.sbaonline.sba.gov/

Committee on Small Business and Entrepreneurship
http://sbc.senate.gov/

Senate Committee on Small Business and Entrepreneurship
http://www.access.gpo.gov/congress/senate/senate17.html

Contact the committee:
http://sbc.senate.gov/contact.html

SBA Legislation:
http://sbc.senate.gov/bills.html

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9. National Small Business Association- NEWS

Congressional hearings focus on SBA program cuts
Feb 11, 2004

The Senate and House Small Business Committees held hearings today, following release of the President’s budget proposal that would reduce the U.S. Small Business Administration (SBA) funding by 10 percent. Both hearings looked at the proposed reduction in the SBA budget as well as recent short-falls in the 7(a) lending program due to inadequate funding.

SBA Administrator Barreto; representatives from the Association of Small Business Development Centers, National Association of Government Guaranteed Lenders, National Association of Small Business Investment Companies and National Association of Development Companies; and 3 business owners affected by the recent shut-down of SBA’s popular 7(a) program attended. The Senate Small Business Committee Hearing was held Thursday, February 12th with a similar panel of experts.

At both hearings, Administrator Barreto made references to a legislative proposal that would make significant changes to the 7(a) program through a reduced (from 85 to 50 percent) guarantee level. According to Barreto, the reduced guarantee level would give SBA an additional $3 billion in lending authority for the 7(a) program without any appropriations or increased fees. Though this proposal has not been made public, many are concerned over the viability of shifting from the traditional 7(a) program into something more closely resembling the SBA Express program. This program, while paperwork light, relies heavily on credit-scoring and has an average loan size of less than $50,000 with much shorter loan terms.

Both House Small Business Committee Ranking Member Nydia Velazquez (D-N.Y.) and Senate Small Business Committee Chair Olympia Snowe (R-Maine) expressed concern over the handling of the recent 7(a) program shut-down. House Small Business Committee Chairman Manzullo is hopeful that the new proposal would help small businesses expand.

Additional topics of concern addressed at both hearings were the elimination of the Microloan program, Business Information Centers, HUBZones program, Native American Outreach, New Market Venture Capital, PRIME Technical Assistance, and the United States Export Assistance Centers (USEACs). The Small Business Development Centers also received a funding cut in the proposed budget.

The Senate Small Business Committee will be holding a roundtable discussion on Wednesday, February 25th to further discuss the funding shortfalls and seek real answers from those in the small business community. NSBA will be participating in that roundtable and will continue advocating for a fully-funded SBA to meet the needs and demands of small businesses.

Write a Letter:
http://capwiz.com/nsbaonline/home/

Issues and Legislation:
http://capwiz.com/nsbaonline/issues/

Press Room:
http://www.nsbaadvocate.com/press/

Current Small-Business Legislation
http://capwiz.com/nsbaonline/issues/bills/

[CAcyclist]

10. The Chamber of Commerce supports republicans

I had great pleasure in refusing to join the my local Chamber of Commerce when they called me asking me to join. I told them that I was opposed to their support of Arnold S. for governor and I didn't generally agree with their political positions.

Maybe now they will see that their best interests lie with the democrats, but I doubt it.