Preliminary figures for the U.S. Small Business Administration's flagship 7(a) lending program indicate that the agency guaranteed fewer loans for less money during the October-to-December quarter than it did a year earlier, according to Rep. Nydia M. Velazquez.
The New York Democrat said Monday in a press release that the SBA guaranteed about $3.3 billion of loans in the quarter, the first in the federal government's 2006 fiscal year. It guaranteed about $3.6 billion in the year-earlier quarter; Rep. Velazquez attributed the 9% drop to a recently implemented fee increase.
The SBA said it guaranteed 21,002 7(a) loans in the first quarter of fiscal 2006, down 9.46% from the first quarter of fiscal 2005.
"The Bush administration chose to shift the cost of the program on to this nation's entrepreneurs and lenders," Rep. Velazquez said in the press release. "Now, as a result, this nation's economic drivers are receiving less and less capital to stimulate job creation."
The SBA has not published its first-quarter statistics. A spokeswoman for Rep. Velazquez said the congresswoman received her numbers from the agency.
Paul Merski, chief economist for the Independent Community Bankers of America, said the decline "bears watching," but added that it was too soon to draw any conclusions.
"It could just be a seasonal fluctuation with the SBA preoccupied with disaster-relief applications," he said.
Michael W. Hager, associate administrator for SBA's office of capital access was traveling Monday and unavailable for comment.
