Omnibus SBA Reauthorization Bill Introduced in Senate

May 14, 2008

U.S. Senate Committee on Small Business and Entrepreneurship Chairman John Kerry (D-Mass.), Ranking Member Olympia Snowe (R-Maine), and Sen. Carl Levin (D-Mich) recently introduced S. 2902, the SBA Reauthorization and Improvements Act of 2008.

S 2902 is a compilation of four separate Small Business Administration (SBA) reauthorization bills. Although three of the four measures were unanimously approved by the Committee on Small Business and Entrepreneurship, they have been blocked from consideration and passage by the full Senate for almost one year—due to the philosophical objections of a single senator. The fourth bill, introduced by Sen. Snowe, is considered non-controversial.

S. 2902 is comprised of the following:

Title I: Small Business Lending (S. 1256)
This section reauthorizes the SBA’s lending programs—including the Microloan, PRIME, 7(a), and 504 loan programs—for three years and establishes an Intermediary Lending Pilot Program for small businesses that have outgrown the microloan program but would not yet be able to access the rest of the SBA’s conventional loan products. Based on a successful program at the U.S. Department of Agriculture, the pilot program would allow for loans between $35,000 and $200,000.
For more information, please see May 22 “Senate Small Business Committee Passes SBA Reauthorization Measure”

Title II: Small Business Venture Capital (S. 1662/S. 1663)
This section would reauthorize for three years the Small Business Investment Company (SBIC) Debenture and New Markets Venture Capital (NMVC) programs. It also seeks to simplify and clarify both programs and make them more attractive to investors. It also seeks to encourage equity investment in firms owned by minorities and women.

Title III: Small Business Entrepreneurial Development (S. 1671) 
This section seeks to reauthorize and improve the SBA’s entrepreneurial development programs, including Small Business Development Centers, Women’s Business Centers, and SCORE. It also attempts to increase the assistance available to small businesses interested in international trade.

Title IV: Small Business Lender Oversight (S. 2288)
The only section not previously approved by the committee, this section seeks to improve the SBA’s lender oversight by requiring the SBA to develop and implement oversight technology for the 7(a) and 504 programs. It also requires the SBA administrator to monitor and measure the rates of loan liquidation, currency, recovery, and delinquency and use the findings to determine lender portfolio quality and improve lender oversight. It also stipulates the need for quarterly lender evaluations and allows for onsite reviews of covered lenders.

For more information on S. 2288, see: Nov. 21 “Increased Lender Oversight Bill Introduced”

NSBA supports the passage of S. 2902 and encourages its members to contact their senators ask them to do the same by signing onto the attached Dear Colleague letter, circulated by Sens. Kerry and Snowe.