The Small Business Administration plans to increase slightly the 7(a) program loans that it will back this year, to $9.6 billion.

Before adjourning for the year, Congress cut SBA's fiscal 1998 budget by 16%, to $716 million. However, most of that reduction affects the agency's disaster-relief programs, which had funds remaining from last fiscal year, a spokesman said.

Under the new budget, SBA can back at least $9.2 billion in 7(a) loans. If Congress in January permits the agency to dip into unspent money from loans that were canceled in 1992 and 1993, SBA's lending authority for 7(a) loans would rise to $9.6 billion-up from the record $9.46 billion last year, the spokesman said.

The $8 million that SBA received to pay for improved lender oversight and new computer systems should help shave costs, though the agency had requested $18 million, the spokesman said.

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