Small Business Administration: A Primer on Programs Page: 5 of 24
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Small Business Administration: A Primer on Programs
The Small Business Administration (SBA) administers several programs to support small
businesses, including loan guarantee programs to enhance small business access to capital;
contracting programs to increase small business opportunities in federal contracting; direct loan
programs for businesses, homeowners, and renters to assist their recovery from natural disasters;
and small business management and technical assistance training programs to assist business
formation and expansion.
Congressional interest in the SBA's loan and contracting programs has increased in recent years,
primarily because small businesses are viewed as a means to stimulate economic activity, create
jobs, and assist in the national economic recovery. Many Members of Congress also regularly
receive constituent inquiries about SBA loans, the loan guarantee programs, and special
contracting programs and this report provides an overview of these programs. In addition, after
the enactment of the Small Business Additional Temporary Extension Act of 2011 (P.L. 112-17),
the SBA's authorization is scheduled to expire on July 31, 2011.
This report is designed to assist Congress in the event that it considers the reauthorization of the
SBA by providing a summary and analysis of the SBA's major programs, including changes made
by the American Recovery and Reinvestment Act (P.L. 111-5) and the Small Business Jobs Act of
2010 (P.L. 111-240), and by referencing other CRS reports which examine these programs in
The SBA's programs have detailed rules on program requirements and administration that are not
covered in this report. Detailed information is available on the SBA's website, 15 U.S.C. 631 et
seq., and in Title 13 of the Code of Federal Regulations.'
The Small Business Act states that continued free competition is "the essence of the American
economic system."2 It declares that it is the policy of Congress to ensure that a fair proportion of
government contracts are awarded to small businesses and to support small businesses with
financing, export support, and other means. Moreover, the act charges the SBA with representing
small business interests in interactions with other government agencies.
The SBA also has programs to assist small businesses owned by women, service-disabled
veterans, and the socially and economically disadvantaged. These programs provide participants
training and reduced competition for government contracts.
SBA's origins can be traced to the Great Depression of the 1930s and World War II when
concerns about unemployment and war production were paramount. The SBA replaced the
Reconstruction Finance Corporation (RFC), which was created by the federal government in
1932 to provide funding for businesses of all sizes during the Depression and later financed war
production. During the early 1950s the RFC was disbanded amidst charges of political favoritism
in granting loans. In 1953, Congress passed the Small Business Act (P.L. 83-163) that created the
SBA. The SBA has undergone many changes since 1953. One key change is that it no longer
makes direct loans to businesses or individuals except for disaster loans.
Congressional Research Service
1 See http://www.sba.gov.
2 P.L. 85-536, as amended.
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Small Business Administration: A Primer on Programs, report, June 22, 2011; Washington D.C.. (https://digital.library.unt.edu/ark:/67531/metadc805667/m1/5/: accessed April 21, 2019), University of North Texas Libraries, Digital Library, https://digital.library.unt.edu; crediting UNT Libraries Government Documents Department.