Tipton Subcommittee Exposes Government Waste and Duplication Among SBA, USDA Loan Programs
GAO Confirms Overlap Among Programs Undermines Effectiveness
The Small Business Subcommittee on Agriculture, Energy and Trade, led by Chairman Scott Tipton (R-CO), today held a hearing to analyze the overlap and duplication among guaranteed loan programs operated by the United States Small Business Administration (SBA) and the United States Department of Agriculture (USDA).
Both agencies provide guarantees for loans to businesses in rural areas, but the Government Accountability Office found the overlap of these programs to be an inefficient use of scarce government resources. Primarily, the hearing examined duplication among the SBA 7(a) Loan Program, the SBA 504 Loan Program, and the USDA Business and Industry Loan Program.
“Although the growth of the federal debt is slowing, we still have a very long way to go toward substantially addressing our nation’s debt and deficit crisis,” said Chairman Tipton. “The government’s inability to balance its budget and exercise fiscal restraint should be a call to all public officials to find ways to expose inefficiencies, cut spending, and streamline programs. Today’s hearing proved that the USDA and SBA could become more efficient by reducing overlap in its loan programs, both for the sake of confused small business owners and the sake of our nation’s budget.”
Materials from the hearing are available on the Committee’s website HERE.
William B. Shear, Director of Financial Markets and Community Investment at the U.S. GAO, Washington, DC, said, “Economic development programs that effectively provide assistance to entrepreneurs, in conjunction with state and local government and private sector economic development initiatives, may help businesses develop and expand. However, we have found that the ways that these programs have been administered, and the lack of data collection and program evaluations, could lead to inefficient delivery of services. These inefficiencies could compromise the government’s ability to effectively provide the needed services and meet the shared goals of the programs.”