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As Chair of the Senate Committee on Small Business
and Entrepreneurship, I understand how important
small businesses in Maine and throughout America are
to our economy and quality of life. Small businesses
represent 99 percent of all employers, create nearly
three-quarters of all net new jobs, and employ over
50 percent of the private-sector workforce. They
are the foundation, the base, the core - the heart -
of our economy. America is America because of our
small businesses.
The Small Business Administration (SBA) plays a
vital role in our small business community by
providing entrepreneurs with the capital they need
to start small business and expand existing small
businesses. Since 1999, the agency has helped to
create or retain 5.3 million jobs. It is essential
that we support entrepreneurs with the tools they
need to create jobs and grow the economy.
Last year, the SBA dispersed record-breaking totals
of loans to small businesses, both in the number of
loans and total dollar value provided to small
businesses. SBA loan and investment programs have
produced numerous success stories- including aiding
the founders of Intel, Staples, America Online,
Federal Express, Outback Steakhouse, Ben & Jerry’s,
Callaway Golf, as well as thousands of other
successful businesses. I strongly believe the SBA
must be provided with the resources it requires to
meet its mission.
My plan is to build upon these successes through the
reauthorization of the SBA’s finance,
entrepreneurial development, government contracting,
and disaster recovery programs, which is required by
Federal law. Last week marked the beginning of the
reauthorization process. My Committee will conduct
hearings, examine the oral and written testimony,
and evaluate the performance of SBA programs. I
hope reauthorization will lead to a renewed SBA that
is wholly dedicated to fostering small business
ownership in America.
I have introduced several pieces of legislation that
I believe will greatly increase the effectiveness of
the SBA. The first, the Small Business Lending
Improvement Act, streamlines the process that helps
small businesses obtain the capital they require to
compete. It brings fundamental and long-awaited
reforms to the operation of the Preferred Lenders
Program. Rather than mandate 71 separate
applications, the PLP program lenders would only be
required to complete one application. This would
create a “National Preferred Lenders Program” that
will remedy the inefficiencies and cost of applying
for PLP status in each district. Currently, a small
business’ eligibility to receive a loan is
determined by a confusing multi-page chart that has
different size standards for every industry. This
chart is nothing more than a bureaucratic
impediment, and this bill would fix that problem.
The second bill reforms and enhances the Small
Business Investment Companies (SBIC) program. SBICs
use their own capital, combined with funds borrowed
from other private investors and supported by an SBA
guarantee, to make equity and debt investments in
qualifying small businesses. The structure of the
program is unique and has been a model for similar
public-private partnerships around the world. This
bill creates a new SBIC program that would provide
financing to small businesses without needing
federal appropriations. Additionally, the new
program would prevent financial losses to the
government by increasing its share of SBICs’
profits.
I will also reject any attempt to eliminate the
SBA’s Microloan Program, which provides loans of up
to $35,000 and technical assistance to new and
growing small businesses. This relatively
inexpensive program helps entrepreneurs start and
grow small businesses throughout our nation. In
Maine, almost 90 loans have been made in the program
over the last two years, for a total of over $1
million. It has a proven record of helping small
businesses that could not get any other financing so
we must not eliminate this crucial source of small
business growth.
Lastly, I am opposed to the SBA’s plan to charge
additional fees on small businesses in the 7(a),
504, and SBIC programs. These are highly successful
programs and none receive appropriations to
subsidize its loans. The Administration proposes to
increase fees on small businesses to raise $7
million in revenue, which will be used for the SBA’s
administrative costs. Increasing fees paid by small
businesses is not the way to reduce the budget.
These small businesses are already paying fees and
taxes to fund the Agency. We can not make it more
costly for them to get financing.
From family farms to software development, small
businesses are the foundation of our economy and the
lynchpin for the innovation that moves our country
forward. Americans who assume the risks and
responsibilities inherent in owning and operating a
business deserve our praise, admiration and
unwavering support. To support them, America needs a
strong and vibrant Small Business Administration.
The SBA has played a central role in the economic
well-being of the nation and its record achievements
and I will continue my efforts to ensure that it
remains a cornerstone of economic growth and job
creation. I have big dreams for the small businesses
of our country and I know we can achieve them if the
SBA works closely with Congress and keeps up its
momentum for success. |
