News From Congresswoman
Nydia M. Velázquez
Representing New York's 12th Congressional District - Brooklyn, Manhattan, Queens
Ranking Democratic Member, House Small Business Committee

For Immediate Release
January 21, 2004

Contact: Wendy Belzer,Kate Davis (202) 225-2361

Velázquez Continues to Push for 7(a) Hearing

WASHINGTON - Congresswoman Nydia M. Velázquez (D-N.Y.), Ranking Member of the House Small Business Committee, today expressed her concerns during a hearing on governance regarding the need to address the shut down of the Small Business Administration's (SBA) 7(a) loan program, which has created problems for the small business community.

"From Enron to WorldCom, the desire to satisfy shareholders has pushed these companies over the edge," Congresswoman Velázquez said. "These types of scandals are not directly related to small businesses since they have occurred in large, publicly-traded companies, calling into question the relevance of this issue for the Small Business Committee. Unfortunately, these types of governance issues are not solely limited to the private sector - many times decisions that are made at the federal level serve to create the very complications that we try to stop. An example of this is the continuing crisis in the SBA's 7(a) loan program, which goes without swift and thorough Congressional scrutiny."

A request was made last week by Democrats to Small Business Committee Chairman Manzullo for a hearing on SBA's recent 7(a) loan program shutdown and was denied. Congresswoman Velázquez announced she would exercise her right under the Committee's rules that allow the minority to have one witness at every hearing. Given this right, the Congresswoman called Tony Wilkinson of the National Association of Government Guaranteed Lenders (NAGGL) to testify at today's hearing on the 7(a) crisis.

"The administration's current solution is no solution at all," Congresswoman Velázquez said. "The SBA has continued its $750,000 cap on loans, banned the use of 7(a) loans in larger financing packages, and has not addressed the inequities suffered by those small businesses that had their applications outright cancelled. And, to top it all off, it is likely the program will shut down again before the end of January. Does this sound like a solution to you? It doesn't to me or my Democratic colleagues on the Committee."

"Small businesses in the U.S. drive job creation and contribute to positive economic growth," Congresswoman Velázquez continued. "This is especially important now as recent reports confirm the economy is failing to add the number of jobs necessary to put American back to work. A real commitment from this administration to the small business sector is exactly what our nation needs right now. Without this, the economy will be unable to make a full recovery because small businesses will be left out in the cold."

Congresswoman Velázquez will continue to make requests to the Chairman of the House Small Business Committee to hold a hearing to address the 7(a) loan crisis exclusively.

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