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Small business advocate sees unrelenting effort to destroy SBA

Small business will be shut out of government contracts

By Doug Caldwell
Central Valley Business Times
February 16, 2006

President George W. Bush and the Republican-controlled Congress are hell-bent on destroying the Small Business Administration so major defense contractors can get what's still going to small firms in government contracts, says the head of the American Small Business League.

Mr. Bush's proposed federal budget, for the sixth year in a row, cuts money allocated to the SBA, says Lloyd Chapman, president of the Bay Area-based advocacy group.

"The Bush Administration intends to close the SBA and end all federal contracting programs for small businesses, women and minorities," Mr. Chapman says in an interview with CVBT.

((Listen to the full interview by clicking on the link below.))

Mr. Chapman says there's been little opposition from business groups. And he says because they are in the minority in both houses of Congress, Democrats have not been able to overcome the Republicans.

He says the only answer might lie in the courts.

"I like going to court. I've never lost a lawsuit against the federal government in my life," Mr. Chapman says. "My goal for 2006 is to let a federal judge look at this issue."

He says he expects to file suit within a month challenging SBA cuts as violating federal law.

Mr. Chapman says if he's not successful, small businesses will be in danger of losing "$100 billion a year in federal contracts and subcontracts. I think it will be devastating to small businesses."

Although the $624 million budget request is $31 million more than the initial request for 2006, the budget is artificially inflated with a sizeable allocation that was not part of this year's budget, he says.

Taken apart, the operating budget would be $429 million, or 28 percent less than the initial $593 million for 2006, Mr. Chapman says. Moreover, the 2007 request cuts SBA staff by 24 percent, increases costs to borrowers for future disaster loans, increases fees for small business loans, and axes a number of programs including the Microloan and Microloan Technical Assistance Programs, which serve a large proportion of minority- and women-owned small businesses, he says.

Listen to Mr. Chapman's interview here



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