SALAZAR SUPPORTS SMALL BUSINESS DEVELOPMENT

Salazar Votes to Reinstate Federal Small Business Loans

WASHINGTON, DC – Congressman John Salazar (CO-03) today helped restore nearly $80 million in loan for rural small businesses. Salazar’s efforts reinstated funding for the Small Business Administration’s 7(a) loan program, which had been zeroed out in the appropriations process for Fiscal Year 2005.  Salazar hailed this move as an important step in keeping the federal government’s commitment to rural economic development.

“Small business is the economic engine that drives the economy of the Third Congressional District,” said Salazar. “Congress needs to make a real commitment to supporting rural economic development. Many small business owners cannot access traditional financing alternatives - SBA loans are the only way rural small businesses can get the resources and capital they need.”

In 2004, the SBA’s 7(a) loan program provided $25.4 million to businesses in the 3^rd Congressional District.  Funding for the program was eliminated last year, placing an unfair burden on rural small businesses.  Up front fees increased between $1500 to $3000, while fees for larger loans are now as much as $50,000.  As fees have increased, less capital has gone into the economy, the number of active lenders in the program has declined, and small businesses have suffered.

“The 7(a) program is a proven success,” said Salazar. “Last year, federal loans to small businesses created nearly 750 jobs in the Third CD. We need to do what we can to increase that job growth.”

Salazar supported an amendment to the House Science, State, Justice and Commerce Appropriations Bill for Fiscal Year 2006, which funds the Small Business Administration.  The amendment restored funding for the Small Business Administration’s 7(a) loan program to the FY04 level of $79 million.  The House of Representatives passed the SSJC this afternoon.  Salazar will work with the Senate delegation to ensure that similar funding is included in the Senate version of the bill.