Sequestration will cut federal contracts & SBA loan subsidies for small businesses

New Year, New Business- SBA Deputy Administrator Marie Johns visits Tierra Dulce, a McAllen, Texas based custom furniture and antique business to talk about SBA's exporting resources. SOURCE: via Facebook

Small businesses will be awarded fewer federal contracts and face greater difficulties in obtaining business loans if sequestration takes effect on March 1.

The Small Business Administration, which guarantees many bank loans made to small businesses and provides training and counseling for entrepreneurs, is funded through the non-defense discretionary budget, which is facing another $492 billion in across-the-board “sequester” cuts unless Congress and the White House reach a $1.2 trillion deficit reduction deal by the end of February.

Read more: Analysis: Impact of sequestration on non-defense discretionary spending

If the sequester is triggered, the SBA would cut loan guarantees for small businesses, scale back training and business development programs to help small businesses win federal contracts, and counseling services to help start up businesses across the country.

“Sequestration’s indiscriminate cuts would limit our ability to deliver these vital services to small businesses at a time when they, and our nation’s economy, can scarcely afford it,” wrote SBA Administrator Karen Mills to the Senate Appropriations Committee.

Sequestration would:

  •  turn away 12,000 small businesses seeking technical assistance and training from Women Business Centers [WBC], resulting in between 100 and 200 fewer women-owned start-ups compared to last year;
  •  cut 2,000 long-term counseling clients serviced by Small Business Development Centers [SBDC];

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One Comment on “Sequestration will cut federal contracts & SBA loan subsidies for small businesses

  1. Pingback: Roundup: Impacts of sequestration on defense & non-defense programs | What The Folly?!

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