Skip to main content

SBA to Improve Services to Queens Small Businesses

June 18, 2014
U.S. Rep. Grace Meng (D-Queens) announced today that the Small Business Administration (SBA) will improve certain services in the wake of the recent Congressional field hearing in Queens, which probed the agency's poor outreach to local small businesses.
The hearing, held at Queens College by the House Small Business Subcommittee on Contracting and Workforce this past March, examined why emerging businesses, startups and minority small-business owners in Queens struggle to use federal programs that they are entitled to utilize. Meng, who helped arrange the hearing, serves as the panel's Ranking Member.
The changes that the SBA will be implementing are intended to expand access to SBA loans for underserved small-business owners. The difficulty of receiving such loans was among the complaints from witnesses who testified at the hearing. The improvements include:
  • Making it easier for small businesses to apply and be approved for SBA-backed loans
Starting on July 1, banks that grant SBA loans of $350,000 or less will no longer be required to assess an entrepreneur's cash flow or debt-service coverage. The SBA expects the move to simplify the lending process by reducing paperwork and speeding up the amount of time it takes to process loans.
  • Combining personal and business credit scores for SBA loans
This new policy, also effective July 1, will make it easier for entrepreneurs to qualify for SBA-backed loans. Often, small-business owners are rejected for loans if their personal scores are low, even if the credit rating for their businesses are high. By evaluating the creditworthiness of their businesses rather than just their personal bills, more loans will flow into the hands of deserving entrepreneurs.
  • New electronic lending platform to make loan processing simpler
Next year, the SBA will launch SBA One, a user-friendly electronic lending platform for processing loans. SBA One will automate the uploading of documents and the generation of forms. It will also allow for electronic signatures and data management.
"I am extremely pleased that the SBA is addressing some of the problems raised during our recent Congressional field hearing in Queens," said Meng. "While there is still much more that the SBA can do, these changes are positive steps that will improve and increase access to capital for Queens small businesses. I thank the SBA's new Administrator Maria Contreras-Sweet for understanding the frustrations expressed at our hearing, and I look forward to more fixes in the near future. The SBA is a critical resource for small businesses, and it's imperative that small-business owners in the borough be able to take full advantage of the valuable services that the agency offers."
Maria Contreras-Sweet became the head of the SBA in April. Meng spoke with her last month about implementing improvements.
The SBA's changes will also benefit local banks, since the improvements will make it easier for financial institutions to underwrite SBA loans. Meng plans to sponsor a presentation on the changes this summer so that area banks can write more loans for borough entrepreneurs. The event, which is still in the planning stages, is expected to take place in Queens and include officials from local banks and the SBA.
The Congressional field hearing, "Underserved Small Businesses: Providing Access to Federal Programs," was attended by Meng, the Subcommittee's Chairman Richard Hanna (R-Utica), Rep. Yvette Clarke (D-Brooklyn) and the Small Business Committee's Ranking Member Nydia Velazquez (D-Brooklyn/Queens/Manhattan).
Several witnesses testified including Michele Chang, the SBA's Acting Chief of Staff and the number two person at the agency.
The SBA was created by Congress in 1953 as an independent agency of the federal government to aid, counsel, assist and protect the interests of small businesses. The agency offers many programs for individuals to start and run a small business. These SBA services include loans, grants, business plan-development, business counseling, assistance with tax-exemptions, help with obtaining government contracts, and many other programs.