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Is SBA S.O.L.?

With a general lack of respect from lawmakers and entrepreneurs alike, some say the agency has outlived its usefulness. Can the SBA be saved?

This story appears in the October 2001 issue of Entrepreneur. Subscribe »

People usually complain, loud and long, when a popular government agency is faced with dramatic budget cuts. So what explains the deafening silence after the Bush administration's initial budget slashed funding for the SBA by 40 percent, to $540 million? Small-business-minded senators rode to the rescue, restoring $264 million to a budget resolution in hopes of protecting the 7(a) Loan Guaranty Program and a venture capital program for businesses in economically depressed areas.

Still, some of the dramatic changes survived: Small businesses will pay twice as much-$2,800-in fees for their guaranteed loans, and for the first time, Small Business Development Centers (SBDCs) will start charging entrepreneurs for counseling.

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