Rep Cmte Small Business

Contact: DJ Jordan, Joel Hannahs 202--225-1581

Chairman Graves Questions The Small Business Administration On Sequestration
Cuts Should Be Directed At Wasteful Unauthorized Programs, Not Core Functions

Washington D.C., April 3, 2013 -

House Small Business Committee Chairman Sam Graves (R-MO) today wrote to Small Business Administration (SBA) Administrator Karen Mills about the agency’s plans to execute sequestration cuts in a way that preserves the efficiency of its core functions – counseling, capital access, and contracting.

Leading up to the sequestration enactment date on March 1, the President and his deputies traveled the country creating fear in the small business community by politicizing the effects of the sequester. When in actuality, the President, and the SBA, have a certain level of discretion on how those cuts are applied. Chairman Graves has repeatedly suggested, as
he did in a recent hearing, that savings can be found at the SBA, including those identified by the Government Accountability Office as wasteful programs.  The priority should be to shore up the core functions that have value and, to the extent possible, divert funds from unauthorized, unproven, or frivolous programs.

Chairman Graves wrote, “In a
letter to Senator Mikulski, Chair of the Committee on Appropriations, you explained the Budget Control Act of 2011’s potential impact on the functions of the SBA and its private sector partners. The letter was followed by an oral briefing to the staff of the Committee on Small Business on March 14, 2013. Both communications raise additional issues with respect to sequestration and, in particular, how the agency is planning to conduct its core functions in a time of limited budgetary resources.” 

The Chairman continued, “The communication with Senator Mikulski and the briefing provided to my staff did not provide any detail on contingency plans that the SBA would implement should demand for guaranteed loans exceed the funds available in the business loan account. Given the potential consequences to small businesses seeking capital, the Committee believes that it is important for the SBA to have such contingency plans in place.”

The Committee requested that the SBA provide answers to several questions by April 15, 2013. To read the full letter to the SBA, click