House Small business Committee Chair Wants SBA Reopened

According to an article in the Washington Post, House Small Business Committee Chairwoman Nydia Velázquez (D-NY) is calling for the Small Business Administration (SBA) to be reopened to ensure the nation's small businesses have access to capital.

"It is important that small businesses who apply for loan guarantees that they are able to get their money. This is going to have a direct impact on the operation of their businesses," Velázquez is quoted in the article.

The SBA is one of the agencies impacted by the partial government shutdown.

Velázquez also sent a letter to SBA Administrator Linda McMahon asking how the shutdown is affecting its small business loan programs and how the agency plans to restore them in a timely manner.

"These programs play a critical role in boosting the entrepreneurial and small business sectors of our economy by helping provide access to affordable capital, technical assistance, and procurement opportunities for America's entrepreneurs," Velázquez wrote.

The lack of loan approvals is creating problems for consumers and lenders that use the agency's programs, including credit unions.

On a typical day the SBA handles almost 200 loans for working capital via the 7(a) loan program and about 120 loans for commercial properties through what’s known as the 504 loan program. In total, these two programs alone are dispensing nearly $200 million worth of loans a day to small and midsize U.S. businesses.

Once the government is reopened, it is expected to take the agency two to three weeks to process requests from its normal one-week turnaround.

Many credit unions use SBA programs to provide loans to small businesses and entrepreneurs in their communities.