Portfolio: Tough Choices on SBA Budget
Tough Choices on SBA Budget
The House Small Business Committee doesn’t like much of anything the Small Business Administration has done over the past two years.
This dissatisfaction could cost the agency nearly $100 million. That’s how much the committee recommends be cut from the SBA’s $985 million budget request for next year. These reductions can be made by eliminating duplicative programs and initiatives that show little promise of creating jobs, the committee said.
"The chasm of the deficit requires tough choices," said Republican Representative Sam Graves, of Missouri, who chairs the committee. "Unfortunately a review of the SBA budget shows no effort to make tough choices. In fact, the administrator wants to start new initiatives—initiatives that are unlikely to help small businesses create jobs. Further, the administrator makes no effort at reducing a bloated headquarters operation."
The SBDC program "produces nearly $3 in federal revenue for every dollar spent," said Representative Nydia Velazquez of New York, the committee's ranking Democrat. "It simply makes no sense to divert money from reputable programs and give it to the agency's untested projects."
The committee also recommended eliminating $12 million for the SBA's new program to promote "regional innovation clusters" and $3 million for its "emerging leaders" program, which trains small-business owners in inner-city areas.
In addition, the committee recommended cutting $38 million from the SBA's Office of International Trade. This money, which would be spent on promoting export opportunities for small businesses, duplicates spending on services already provided by states and the Department of Commerce, according to the panel.
Velazquez didn’t agree with all of the committee’s recommendations. For example, she doesn’t favor cutting funding for Veterans Business Centers.
But the fact that she was nearly as critical of the SBA as Graves was is bad news for the SBA. The agency will have to rely on Senator Mary Landrieu, the Louisiana Democrat who chairs the Senate Small Business and Entrepreneurship Committee, to be its champion in the coming battles over next year’s federal budget.