News From Congresswoman
Nydia M. Velázquez
Representing New York's 12th Congressional District - Brooklyn, Manhattan, Queens
Ranking Democratic Member, House Small Business Committee

For Immediate Release
February 10, 2005

CONTACT: Kate Davis, Allyson Ivins, (202) 225-4038

SBA Budget: $100 Million Less Each Year
Budget nearly half of what it was in FY 200; critical programs eliminated

WASHINGTON - Congresswoman Nydia M. Velázquez (D-N.Y.), Ranking Member of the House Small Business Committee, today at a hearing on the FY 2006 budget for the Small Business Administration (SBA) highlighted that this budget is only half of what it was when President Bush first took office, receiving $100 million less each year, and vowed to stand up for these programs in Congress.

"Every year when I think the budget can't get any worse for the SBA, the administration turns around and proves me wrong," Congresswoman Velázquez said. "What was once a Cabinet level agency that had a seat at the table, a $1 billion budget, and a large role in the decision-making process - has sadly become the shell of an agency. SBA is failing to ensure small businesses are receiving federal contracts, and are increasing the cost for entrepreneurs to access capital - they are no longer helping small businesses to start and expand their dreams."

Congresswoman Velázquez was appalled by the significant cuts made again to valuable SBA programs, which provide 1.5 million entrepreneurs with business counseling each year, and thousands more with procurement assistance and lending opportunities to start and expand their businesses. Cuts were made to a number of critical programs including the Women's Business Centers (WBC), HUBZone and SCORE. In addition, programs were eliminated or slated for termination, such as BusinessLINC, Small Business Innovation Research (SBIR) Rural Outreach, SBIR Fast, PRIME, and the New Markets Venture Capital.

For the second year in a row, the budget proposed eliminating the Microloan program, which serves a unique role by supplying small loans to low-income communities, in addition to failing to request any program level for the Small Business Investment Capital (SBIC) Participating Securities program - SBA's largest venture capital program.

"I want to make one thing clear - these are all valuable programs that have contributed to some of the greatest entrepreneurial success stories in this country, and I will stand up for these programs," Congresswoman Velázquez said. "The programs - their successful clientele and the economic gain they have generated over the years - speak for themselves. The real problem here is the fact that they are under-funded and mismanaged."

Over the past year, the administration's actions have been problematic in several key small business areas. From misrepresentation of large businesses as small in the procurement data tracking system, to allowing fees to increase for small business and lenders, and questionable financial reports - the administration's policies and failure to admit mistakes has not bode well for the vitality of their programs. Velázquez accused the administration of also hiding behind the truth about the latest budget cuts.

"The bottom line here is that our small businesses deserve better than this," Congresswoman Velázquez said. "Our nation's small businesses work hard, and they deserve to be told the truth. Do not cut these programs year after year, mismanage them into the ground, and then try to claim things are better than ever. That is simply wrong. The reality is small businesses are not receiving federal contracts like they should be, it costs entrepreneurs more to access capital, and valuable assistance programs are being cut. Small businesses deserve to be told the truth."

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