SBA Proposes $1.06-Billion Budget for 'New Opportunity'

SBA Proposes $1.06-Billion Budget for ‘New Opportunity’

By MARLA DICKERSON

Feb. 9, 2000 12 AM PT

TIMES STAFF WRITER

The Small Business Administration has proposed a record $1.06-billion budget for fiscal 2001, looking to rustle up more funding for programs to serve micro-businesses, Native Americans and companies located in low-income areas.

It’s all part of what the SBA has dubbed a “New Opportunity Agenda” to provide more assistance to women, minorities, start-ups and entrepreneurs toiling in poor rural areas and the inner city.

Unveiled Monday as part of President Clinton’s proposed $1.8-trillion federal budget, the SBA’s 2001 budget represents a nearly 15% increase over the $877 million Congress allocated to the agency for fiscal 2000. SBA Administrator Aida Alvarez expressed high hopes in a news conference of obtaining the extra funding. But that could be wishful thinking, considering last year’s contentious wrangling about the SBA budget and continued charges by Republicans that Alvarez isn’t running a tight ship.

Alvarez seeks to more than triple funding of her much-touted New Markets Initiative, which provides venture capital and technical assistance to businesses operating in low-income areas. The 2001 budget seeks $150 million in SBA-backed funds for these venture capital companies, as well as $30 million to pay for technical assistance for the firms in which they invest.

In addition, the proposed budget would allow the agency to extend guarantees and leverage of as much as:

* $11.5 billion for the 7(a) General Business Loan Guaranty program, in which approved lenders provide SBA-backed loans to small businesses unable to secure financing through normal lending channels.

* $3.75 billion for the 504 Certified Development Company program, which provides small firms with equipment, land and building financing.

* $2.5 billion for the Small Business Investment Company programs, in which SBA-licensed, private-sector investment firms provide venture capital to small firms.

The budget also seeks to boost funding for micro-loans as well as programs targeted at women, veterans and Native Americans. In addition, the SBA has requested $24 million to help upgrade the agency’s systems and training.

Overall, the new budget would enable the agency to extend $20.5 billion in small-business loan guarantees, disaster aid and other assistance in fiscal 2001.

For more details on the proposed budget, head to the SBA’s Web site, https://www.sba.gov, and click on “What’s New.”