DEFINITION of ‘Small Business Administration – SBA’
The Small Business Administration (SBA) is a U.S. government agency, formulated in 1953, that operates autonomously. This agency was established to bolster and promote the economy in general by providing assistance to small businesses. One of the largest functions of the SBA is the provision of counseling to aid individuals trying to start and grow businesses. On the agency’s website, (SBA.gov), there is a wealth of tools to assist small businesses including a small business planner and additional training programs. Localized SBA offices throughout the United States and associated territories offer in-person, one-on-one counseling services that include business plan writing instruction and assistance with small business loans.
BREAKING DOWN ‘Small Business Administration – SBA’
The SBA offers substantial educational information with a specific focus on assisting small business startup and growth. In addition to educational events offered on the SBA’s website, local offices also provide more personalized special events for small business owners.
The History of the SBA
The SBA was established by President Eisenhower through the signing of the Small Business Act in the summer of 1953. In its more than six decades of existence, the SBA has been threatened on numerous occasions. The House of Representatives, controlled by the Republican party in 1996, had the SBA slated to be eliminated. However, the agency survived this threat and went on to receive a record budget in 2000. The SBA faced further threat by President Bush and his administration. Though attempts to cut the agency’s loan program saw significant resistance in Congress, the SBA’s budget was cut repeatedly each year, from 2001 to 2004, when certain SBA expenditures were frozen altogether.
The SBA Loan Program
The loan programs offered by the SBA are among the most visible elements the agency provides. The organization does not offer grants or direct loans, with the exception of disaster relief loans, but instead guarantees against default pieces of business loans extended by banks and other official lenders that meet the agency’s guidelines. The number one function of these loan programs is to make loans with longer repayment periods available to small businesses.
The Future of the SBA
As of 2016, despite numerous attempts to do away with the SBA entirely, many political officials and offices continue to support the agency. President Barack Obama and his administration have continually supported the SBA and remain backers of a substantial budget allotment for the agency. The SBA’s ability to offer loans has also been significantly strengthened by the American Recovery and Reinvestment Act of 2009 and the Small Business Jobs Act of 2010.