Karen Mills: On the Small Business Administration’s (SBA) role in supporting small businesses owners and entrepreneurs

By Karen Mills, Administrator of the Small Business Administration. This blog post was submitted as part of the Democratic Issues Conference and Job Summit.

Small businesses are America’s engine of job creation and economic growth, and the SBA plays a critical role in supporting small businesses owners and entrepreneurs as they start and grow those businesses. We provide small businesses with access to capital, opportunities in government contracting, and counseling and training—or, more simply, the 3 C’s: capital, contracts, and counseling. 

After credit markets froze in October 2008, we knew 2009 would be a tough year for small business. That’s why the President and the new Congress moved quickly to pass the Recovery Act, which contained a number of key provisions for the small business community.  

The Recovery Act reduced the fees on our two most popular loan programs, 7(a) and 504, and we increased the government guarantee on 7(a) loans. This helped us leverage $375 million in Recovery Act funds into $16 billion in small business lending. Put another way, it allowed us to support more than 40,000 small businesses that have been able to save and create tens of thousands of jobs. 

In fact, these SBA loan provisions were so successful that Congress extended their funding by $125 million through next month, and the President has asked to extend funding even further. In addition, the President has called on Congress to raise the caps on SBA loans from $2 million to $5 million. We know that demand exists for larger loans, especially from businesses such as franchises and auto dealerships, and increasing loan sizes will put capital in the hands of businesses that need it to expand and create even more jobs in 2010. 

In 2010, the SBA is continuing to use “capital, contracting, and counseling” to build businesses and create jobs. That means growing our extensive lender network to provide small businesses with even more points of access to capital… working to ensure that 23% of all federal contacting dollars goes to small businesses… and providing free counseling and training to thousands of small business owners and entrepreneurs through our 68 district offices and 14,000 resource partners. 

• We’ll continue to be the leading voice of small businesses, both for the “Main Street” businesses that are the heart of our communities, to the innovative “high-growth, high-impact” businesses throughout the country. 
   
• We’ll lead in the development of new “regional innovation clusters”. We’ve helped establish a robotics cluster in Michigan in 2009, and we’ll help establish even more in 2010.
   
• We’ll work to increase small business exporting. We want to increase the number and strength of small business exporters in order to grow our economy and strengthen our global competitiveness. 
   
• We’ll quickly respond when disaster strikes to provide both businesses and individuals with the low interest loans they need to get back on their feet.
   
• And we’ll continue to invest in the SBA, its people, and its technology to be responsible to taxpayers and responsive to the needs of 21^st century small businesses. 

I’m looking forward to working with Congress and the Administration as we continue to provide small businesses with the tools they need to grow and create jobs—pulling us out of recession, into recovery, and building America’s competitiveness for the future.