The ranking Republican member on the Senate Committee on Small Business and Entrepreneurship recently said the small business provisions in the stimulus bill passed earlier this year are having a positive effect on the nation's smaller firms. "The small business provisions we included in the stimulus are yielding tangible results. We have witnessed an approximate 60% increase in SBA lending, which translates into more than $11.3 billion in new loans through the 7(a) and 504 programs and the creation or retention of over 300,000 jobs," said Senator Olympia Snowe (R-ME). "In procurement opportunities through the stimulus, the Federal government is exceeding its small business statutory contracting goals in every category except for women-owned small businesses."
Snowe's comments came after an oversight hearing held by her and committee chair Mary Landrieu (D-LA) entitled "The Recovery Act for Small Businesses: What Is Working and What Comes Next?" According to witness testimony, the $787 billion American Recovery and Reinvestment Act (ARRA) passed in February has, as Snowe noted, increased lending and made it easier for small businesses to create and retain jobs. Still, both senators agreed that more work remains in several different areas. "We cannot rest on our laurels," said Snowe. "I urge the Administration to implement a meaningful women's contracting program like Congress directed it to nearly a decade ago. This would help the Federal government to meet-and exceed-its contracting requirements for women-owned small businesses. And we must also pass legislation I introduced to increase the maximum level on 7(a) and 504 loans to $5 million so that more small businesses are able to access capital."
The legislation to which Snowe refers is S. 1615, also called the Next Step for Main Street Credit Availability Act of 2009, which was introduced in August. In addition to increasing the maximum on 7(a) and most 504 loans, the bill would also raise the maximum threshold for microloans from $35,000 to $50,000.
Another area in which the senators are seeking improvement is federal contracting. While the biggest spending agency, the Department of Defense (DOD), has spent 58% of its ARRA funds on small businesses, the federal government as a whole is lagging behind, having spent just over 25% of total recovery act funds on small businesses, a number dragged down by agencies like the Department of Energy (DOE), which has spent less than 7% of its recovery act funds on smaller firms.
Another controversial ARRA provision that was criticized in the hearing exempted the National Institutes of Health (NIH) from participation in the Small Business Innovation Research (SBIR) and Small Business Technology Transfer (STTR) programs. In joint letters sent early this year, both Landrieu and Snowe and Senators Ben Cardin (D-MD) and Russ Feingold (D-WI) urged NIH to allocate the money anyway, despite the exemption. "This provision cheated small businesses out of as much as $230 million in work, and it directly counters the goals of the Recovery Act to create high-paying jobs, spur innovation and boost America's competitiveness," said Landrieu. "The SBIR and STTR programs have a proven track record in these areas."
Jacob Barron, NACM staff writer. Follow us on Twitter at http://twitter.com/NACM_National.