Federal Budget Proposes to Cut 25 Percent from SBA-How the Money is Spent is Critical

By: Christine V. Williams on 02/11/2020

The federal budget was released yesterday and while some agencies gained funding; many others did not.  For instance, the SBA’s budget was cut by 25 percent, which may be offset by a program set up by SBA to collect fees for financial services.  Here is an excerpt with a link to the budget:

Funding Highlights:

  • The Small Business Administration (SBA) serves American entrepreneurs in their pursuit to start, grow, recover, and expand their businesses. As the Nation’s leading advocate for small businesses, SBA ensures that business owners have access to affordable capital, mentoring and counseling opportunities, and immediate support in the wake of disaster.
  • The Budget recognizes the contributions small businesses play in fostering economic growth and spurring innovation throughout the Nation. The Budget supports Boots to Business, a program that provides entrepreneurial training courses to veterans, servicemembers transitioning from military to civilian life, and military spouses through the Department of Defense’s Transition Assistance Program (TAP).
  • The Budget continues to demonstrate fiscal restraint by prioritizing the essential functions of the Federal Government and cutting wasteful or duplicative programs. The Budget eliminates funding for the Program for Investment in Micro-Entrepreneurs (PRIME). These services are already provided by SBA’s Microloan Technical Assistance Program. Eliminating PRIME would save taxpayers $6 million a year based on the 2020 enacted level.
  • The Budget requests $739 million in new budget authority for 2021, a $243 million or 25-percent decrease from the 2020 enacted level, which includes funds provided under the disaster relief cap. This request is partially offset by a fiscally responsible proposal to allow SBA the flexibility to set an upfront fee across its business loan programs, providing $80 million in offsetting collections.

Here is the link for the budget in its entirety: budget_fy21