Queue Activated as SBA Presses for Longer Term Funding
WASHINGTON
– U.S. Small Business Administration Administrator Karen Mills today issued
the following statement regarding efforts to ensure continued funding for two
key provisions first implemented as part of the American Reinvestment and Recovery
Act (ARRA) of 2009:
“Two key enhancements to SBA’s
loan programs – increased guarantees and reduced fees in our two largest
lending programs – have engineered a significant turnaround in SBA lending
and been successful in helping jump-start our economy for small businesses. To
date, these programs have supported more than $27.5 billion in lending to more
than 60,000 small businesses across the country. They have also brought more than
1,300 lenders back to SBA’s loan programs, increasing the points of access
for small businesses to get the capital they have needed during these tough economic
times.
“Due to the heavy demand from small businesses
for available credit, the original $375 million provided under the ARRA for these
loans was exhausted in November. Since then, additional funds have been provided
for short-term extensions, and those funds, too, have been exhausted. As a result,
today we communicated to our lending partners that we have reactivated the Recovery
Loan Queue. The queue is an efficient and transparent way to ensure that every
remaining dollar possible is made available to help small businesses drive economic
recovery across the country.
“Small businesses are
a key engine for job creation across the country. With that in mind, President
Obama has laid out an aggressive agenda for providing small businesses with the
tools they need to drive economic growth. A key piece of that agenda is a longer-term
extension of these increased guarantees and reduced fees, and we urge Congress
to move quickly to continue these critical programs.”
SBA’s
ARRA Programs:
As part of the Recovery Act enacted on
Feb. 17, 2009, SBA received $730 million to help small businesses, including $375
million to increase the SBA guarantee on 7(a) loans to 90 percent and to reduce
borrower fees on most 7(a) and 504 loans. The funds for these programs were exhausted
on Nov. 23, 2009, and an additional $125 million was provided in December. Those
funds were exhausted in late February. An additional $60 million was provided
to extend the programs through March. SBA was authorized for an additional $40
million in late March, and an additional $80 million was provided in mid-April
to support the programs through May 31.
SBA’s 7(a)
and 504 ARRA Transition Plan:
SBA has transitioned 7(a)
and 504 programs back to their pre-ARRA terms and communicating those plans with
its lending partners. As part of this plan, SBA has reactivated its Recovery Loan
Queue today. The queue will operate in the same manner as when originally implemented
in November 2009.
Sometimes previously approved loans are
later cancelled or never disbursed for a variety of reasons, and the funds committed
to those loans can be applied to applications in the queue. The queue takes this
into account and beginning on the transition date will allow eligible small businesses,
in consultation with their lenders, to choose to be placed in the queue for possible
approval for an ARRA loan if funding once again becomes available. Small business
owners and lenders will have transparent access to the queue via www.sba.gov/recoveryq
and will be able to remove themselves from the queue at any time to be considered
for a non-ARRA SBA loan with all applicable fees and, for 7(a) loans, standard
guaranty levels.
The authorization for the 90 percent guarantee
on 7(a) loans ends on May 31, but the authorization for fee waivers is in place
through September 2010.
To learn more about SBA’s ARRA
programs and other resources for small businesses, please visit www.sba.gov.
