Congress Scraps Subsidies On SBALoans

WASHINGTON - (11/23/04) -- The omnibus spending bill approvedby Congress last weekend will increase the size of allowable loansunder the U.S. Small Business Administration's flagship 7 (a)program but also make it tougher for some borrowers to obtain theloans by eliminating the federal subsidy on fees and other charges.The compromise measure passed by lawmakers increases size of theloans eligible for the federal 75% subsidy from $1.3 million to $2million. It also funds 7 (a) program, which has become popular formany credit unions, at $14.5 billion for 2005, about the same levelof funding as was available this year. The bill also increases themaximum amount of a loan available under the SBA Express program,which provides expedited funding t small business, from $250,000 to$350,000.