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Editorial: A Lifeline Reopened
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Business New Haven
1/19/2004
By: BNH
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Thanks to last-minute action by Congress, the U.S. Small Business Administration (SBA) was able to reopen its 7(a) loan program on January 14th, with an additional $470 million in lending authority, and a loan cap of $750,000 per loan recipient.
With the SBA's fiscal-year 2004 appropriation still awaiting approval in the U.S. Senate, the program was suspended January 6 due to "volume constraints" (read: not enough money). Since the beginning of the fiscal year on October 1, SBA funding has come from a series of short-term continuing resolutions based on the FY 2003 program level.
Under the resolution the SBA reopened with$470 million in lending authority through January 31. Once SBA receives its full year's appropriation, it expects to be able to keep the program running without interruption, working with Congress to manage the available funding.
"It is critical to our nation's small business community that the 7(a) program is back up and running as quickly as possible," said SBA Administrator Hector V. Barreto. "We are reopening the program with the funding that Congress has approved, and the SBA will provide 7(a) loans as long as the necessary funding is available. However, it is extremely important that Congress pass an annual appropriation to keep this vital loan program open, without interruption."
Congress deserves plaudits for re-establishing this important lifeline, without which a number of businesses would be forced to discontinue operations.
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