In the face of opposition from the Bush administration, a bipartisan group of lawmakers failed in their bid to extend a law that temporarily halved most of the fees that lenders pay to participate in the Small Business Administration's 7(a) loan program.
The law expired Friday. The lawmaker group wanted to prevent the fees from increasing to pre-2002 levels.
SBA administrator Hector Barreto plans to use the income from the higher fees to replace the annual appropriation that Congress has given the SBA to pay for the 7(a) program's credit losses. Mr. Barreto argues that the plan would free the 7(a) program, which is responsible for the lion's share of the loans the agency guarantees every year, from an increasingly dysfunctional budget process.
