Update on 504 Program Funding

Last week we informed you that the House had passed a large Federal spending bill that included funds to cover the fee shortfalls for both 504 and 7(a) for FY 2012. The Senate passed this same bill on Saturday and the President has signed the bill, which keeps the government funded for the rest of the fiscal year.

For those interested, the bill is H. R. 2055, and the House Conference Report is 112-331. These docs are available on Thomas.gov. There is a link to the SBA in Division C, with the bill text on page 88.

The funds appropriated for both programs are $205 million. These funds are not divided between the two programs in the legislation, so expect the agency to utilize them to keep both programs fully funded at the authorized levels for FY 2012 of $7.5 billion for 504 and $17.5 billion for 7(a). We do not see any issue with this authorization ceiling for 504 this year.

Note that this funding does not impact the 504 Temporary Refinancing program, as that is fully funded by the existing fee and the small additional fee paid by the borrowers.

Also provided in this bill is funding for microloan direct loans of $3.678 million and microloan technical assistance of $20 million, to remain available until September 30, 2013, or for two years.

Again, NADCO thanks the leadership of both the House and Senate Appropriations and Small Business Committees, as this appropriation would not have been possible without their support and very hard work. Further, we recognize the strong support of Administrator Karen Mills and her able team that led the support effort on behalf of the Obama Administration. Her hard work demonstrates the strong commitment by President Obama for access to capital for all small businesses.

Finally, I want to recognize the work within NADCO that helped augment Administration efforts with the Congressional leadership. Two important members of our team include Ms. Debbie Partin, Vice Chair for Legislative Affairs, and Mr. Tom Cator, our able long-time Legislative Advisor. They were both very committed to getting this funding so that the 504 program did not suffer any shutdown, or fall short of funding.

Thanks to all who helped with this effort.

Christopher L. Crawford
President/CEO
703.748.2575
chris@nadco.org