Detailed Information on the
Section 7(a) Guaranteed Loan Program Assessment

The Agency is developing baseline for its revenue growth outcome measure.

SBA is re-writing the Standard Operating Procedure for Loan Processing and Approval

SBA will create Rules and Regulations for the SBA Express program to replace the existing program guide

Implementation of A-76. The Agency MEO team won the competition. The MEO team is now being put into place.

The Office of Capital Access promulgated new liquidation regulations governing the liquidation of loans by 7(a) lenders. These regulations become effective May 15, 2007. On May 10, 2007, SBA published a notice providing guidance on the new regulations.

Measure: Number of 7(a) loans approved for small businesses

Explanation:

Measure: Number of 7(a) loans funded for small businesses

Explanation:

Measure: Number of small businesses assisted.

Explanation:

Measure: Number of 7(a) loans in Underserved Markets

Explanation:

Measure: Loan Approving Cost Per Small Business Loan Funded

Explanation:

Measure: Number of Job Created/Retained

Explanation: SBA is currently trying to establish target for this long-term outcome goal.

Measure: Revenue growth for small businesses receiving SBA assistance

Explanation:Next Urban Institute report will compare revenue growth and business longevity between SBA assisted businesses and those that did not receive assistance. This report is to be available within the next month or two. Upon receiving the Urban Institute Report, SBA will complete a program evaluation on revenue growth and longevity for businesses receiving SBA assistance. At that time the SBA will be able to set a baseline and establish long term targets for these measures.

Measure: Cost per Small Business Assisted

Explanation:

Is the program purpose clear?

Explanation: The program provides general loan financing for a wide variety of purposes to businesses that can't obtain financial assistance on reasonable terms from other sources. This program fills the financing gap for those small businesses that are creditworthy but for other reasons can not otherwise obtain the financing they seek under terms they can utilize.

Evidence: Section 7(a) of the Small Business Act.

Does the program address a specific and existing problem, interest, or need?

Explanation: The 7(a) Program is designed to provide financial assistance to those small businesses deemed eligible by the Agency and which can not obtain their financing on reasonable terms from alternative sources. The financial assistance is through a guaranty (usually 50 - 85 percent) of a 7(a) lender's loans. The SBA guaranty reduces a lender's risk and thus helps provide financing to riskier start-up businesses, existing businesses that have characteristics (such as weak collateral) that make conventional credit unavailable to them, and to groups that own and control little productive capital because they have limited opportunities for small business ownership.

Evidence: According to a study by the Office of Advocacy (Impact of Tight Money and/or Recessions on Small Business - 2003), small businesses typically rely more for their credit on bank lending than larger firms do. As a consequence, smaller businesses may be more adversely affected when tighter bank monetary policies or deteriorating bank health reduces the supply of bank loans. The study further concludes that this finding suggests that SBA lending is countercyclical, providing a stabilizing influence on small business lending. This was also supported by a 1998 study by Hancock and Wilcock, "The Credit Crunch and the Availability of Credit to Small Business."

Is the program designed so that it is not redundant or duplicative of any other Federal, state, local or private effort?

Explanation: Other federal, state, and local loan programs are available to small businesses; however differences in target recipients, eligibility, and program design reduce overlap. Urban Institute research found potential duplication between SBA's 7a and 504 loan guaranty programs where 7(a) loans where used to finance real estate. However, the 7(a) and 504 programs generally differ in their interest rate and fee structure, maturity term, loan structure, maximum allowable amount, type of lender, and loan purpose. Across federal programs Urban Institute research suggests some degree of duplication exists between SBA programs and similar programs run by other federal agencies with the greatest potential for duplication with USDA, especially for rural businesses. Urban Institute research found that similarities between SBA and state and local loan programs vary by state and program. SBA programs have higher maximum loan guarantees and longer term resulting in less duplication among borrowers seeking these characteristics. Eligibility restrictions imposed by some states and local programs that reduce duplication include credit rating, geographic, business sector, and business maturity restrictions.

Evidence: GAO Study 00-220, pp 30-32: stated that "although some of the programs appear to share the same purpose and applicant, in practice additional requirements limit the number of applicants that would be eligible for the programs." Urban Institute Report: Public Sector Duplication of Small Business Administration Loan and Investment Programs: An Analysis of Overlap Between Federal, State, and Local Programs Providing Financial Assistance to Small Businesses.

Is the program design free of major flaws that would limit the program's effectiveness or efficiency?

Explanation: The 7(a) loan program is designed to help businesses obtain credit not otherwise available at reasonable terms. SBA relies on private lenders to make, service, and liquidate loans under various sub-programs. SBA shares default risk with the lender by limiting the guaranty to between 50% and 85%, depending on loan amount. This practice encourages the lenders to apply market-based underwriting/ due diligence practices on the SBA guaranteed loans that they originate. These delivery methods are monitored for performance and cost.

Evidence: Standard Operating Proceedures, Regulations, Lender Loan Monitoring System, Monthly oversight meetings.

Is the program design effectively targeted so that resources will address the program's purpose directly and will reach intended beneficiaries?

Explanation: The 7(a) Loan Program is targeted to small businesses that need financial assistance and which can not get credit on reasonable terms from other sources (there is certification that credit is not otherwise available on reasonable terms requirement). The "gaps" which the 7(a) Program fills are usually associated with providing loans to businesses needing a larger amount or longer maturity than would otherwise be available; have the risk of being a start-up business; offer single purpose collateral; and have limited equity.

Evidence: Regulations, Standard Operating Procedures. The SBA's Loan and Lender Monitoring System confirms that the borrowers in SBA's portfolio, as a group, have credit scores that are lower than the credit scores of businesses in Dun and Bradstreet's small business portfolio. The Urban Institute January 2007 Final Report: Public Sector Duplication of Small Business Administration Loan and Investment Programs: An analysis of overlap between federal, state, and local programs providing financial assistance to small businesses.

Does the program have a limited number of specific long-term performance measures that focus on outcomes and meaningfully reflect the purpose of the program?

Explanation: The 7(a) program contributes towards the SBA's second strategic goal "Increase small business success by bridging competitive opportunity gaps" with a long-term outcome measure focused on job creation and retention. Two additional long-term outcome messures are: "Revenue growth for small businesses receiving SBA assistance" and "Business longevity for small businesses receiving SBA assistance".

Evidence: U.S. Small Business Administration Strategic Plan FY 2006 - FY 2011; Next Urban Institute Report on Revenue and Business Longevity.

Does the program have ambitious targets and timeframes for its long-term measures?

Explanation: For the "Number of jobs created/retained" long-term outcome measure, while SBA tracks and reports the number of jobs created and retained by firms receiving 7(a) loans, the agency does not set targets. For the two long-term outcome measures, "Revenue growth for small businesses receiving SBA assistance" and "Business longevity for small businesses receiving SBA assistance", the next Urban Institute report will compare revenue growth and business longevity between SBA assisted businesses and those that did not receive assistance. Based on the Urban Institute report, SBA will complete a program evaluation on revenue growth and longevity for businesses receiving SBA assistance. At that time the SBA will be able to set a baseline and establish long term targets for these measures.

Evidence: Agency's 5 year Strategic Plan (Fy 2006 - 2011); Next Urban Institute Report on Revenue and Business Longevity.

Does the program have a limited number of specific annual performance measures that can demonstrate progress toward achieving the program's long-term goals?

Explanation: SBA has established two long term outcome measures based on Urban Institute Studies and those measures are Job Created/Retained and Revenue Growth. SBA has also established four annual output measures to be in alignment with the Agency's FY2008-FY2013 Strategic Plan and those measures are Loan Approvals, Loan Funded, Small Business Assisted and Loans in Underserved Markets. SBA also has established the efficiency measures and they are Unit Cost per small businesse assisted and Unit Cost per loan funded.

Evidence: SBA FY2008-F2013 Strategic Plan.

Does the program have baselines and ambitious targets for its annual measures?

Explanation: Aggressive numeric goals are established each year. For example, the increase in the number of loans approved between fiscal years 2005 and 2006 was less than 2%. The goal established in the fiscal year 2008 Performance Budget is 98,835 or an increase of over 9% from FY 2006, the last year for which actual data is available.

Evidence: FY 2008 Performance Budget. Weekly performance reports. Measures tab.

Do all partners (including grantees, sub-grantees, contractors, cost-sharing partners, and other government partners) commit to and work toward the annual and/or long-term goals of the program?

Explanation: The Office of Capital Access (OCA) partners with SBA district offices to achieve its performance goals. OCA forms part of the Goals Team. This is the team that sets the goals for the district offices and through it OCA and the district offices coordinate their efforts and enjoin the lender partners to meet the annual and/or long-term goals of the program.

Evidence: The Goals Team meets every year to establish the goals for the district offices. These goals are tracked through the agency's Execution Scorecard. The annual performance of the district offices is measured against their goals, and a rank is established according to their success achieving them. An OCA Scorecard tracking report was developed to identify on a weekly basis SBA's progress towards its goals.

Are independent evaluations of sufficient scope and quality conducted on a regular basis or as needed to support program improvements and evaluate effectiveness and relevance to the problem, interest, or need?

Explanation: In 2007, SBA completed an independent study on program duplication (the results of which are summarized under question 1.3). The Urban Institute is completing a performance assessment to measure the performance of firms assisted through the 7(a), 504, & SBIC Debenture programs. In 2000, SBA completed a study, in conjunction with the Bureau of Labor Statistics (BLS), investigating small businesses that have received financing from SBA partners. In the future, SBA will be conducting an evaluation of the number of jobs per dollars financed which will serve two goals: 1) expand existing data from SBA's 2000 study and provide additional data to validate current program statistics; and 2) verify the accuracy of data submitted to the Agency by small businesses.

Evidence: Urban Institute Duplication study, Urban Institute Work Plan (dated 11/13/2006), Bureau of Labor Statistics study and new study will serve to validate the data that is gathered from the 7(a) applications on each borrower by comparing data received by SBA with data gathered independently.

Are Budget requests explicitly tied to accomplishment of the annual and long-term performance goals, and are the resource needs presented in a complete and transparent manner in the program's budget?

Explanation: Each year the Agency delivers an integrated budget request and performance plan. The budget request is based on the annual and long-term performance goals. This request represents a total of the resources that is needed for the program.

Evidence: SBA Annual Performance Budget submissions, and the Five Year Strategic plan.

Has the program taken meaningful steps to correct its strategic planning deficiencies?

Explanation: SBA's Strategic Plan for the 7(a) Program addresses job creation, assisting new business start-ups and reaching underserved markets.

Evidence: SBA 's Budget Request and Performance Plan for Fiscal Year 2008.

Does the agency regularly collect timely and credible performance information, including information from key program partners, and use it to manage the program and improve performance?

Explanation: The Offices of Capital Access (OCA) and Chief Financial Officer (CFO) collaborate on four fronts to ensure performance dat is used to manage the program: 1. Re-established the Risk Subcommittee (comprising Capital Access and CFO) to maintain a line of communication between the two offices. The Risk Subcommittee meets monthly to review program data and trend analysis. 2. Implementation of the Lender Loan Monitoring System (L/LMS) which provides broad portfolio analysis capabilities to track performance of lenders. 3. Benchmark and track the losses in the portfolio against what was budgeted to eliminate surprises and improve forecasts. 4. Adoption of an econometric model that allows the Agency to better predict portfolio performance.

Evidence: SBA maintains performance date on each lender through the Office of Lender Oversight. SBA reviews up to 30 percent of each lender's portfolio of SBA loans to check compliance with Agency requirements. SBA annually re-computes its 7(a) Subsidy Rate to reflect current conditions.

Are Federal managers and program partners (including grantees, sub-grantees, contractors, cost-sharing partners, and other government partners) held accountable for cost, schedule and performance results?

Explanation: SBA employees' personnel appraisal requirements are linked directly to agency and program goals. Additionally, lenders who perform well and whose processing activity meets or exceeds a specific benchmark can receive delegated credit (and eligibility in certain cases) authority from SBA. If the portfolio begins to underperform (as measured by the Office of Lender Oversight's lender and loan monitoring system), the lender risks losing its delegated status. If a lender loses its delegated status, it must submit its loans for both credit and eligibility determinations by SBA. Suspension from participation is also a risk for underperforming lenders.

Evidence: Personnel plans. Standard Operating Procedures. Regulations.

Are funds (Federal and partners') obligated in a timely manner, spent for the intended purpose and accurately reported?

Explanation: While the 7(a) program requires no credit subsidy, loan obligations are made at the time of loan approval. This is generally within 1 to 6 business days of the receipt by SBA of a complete application from the lender. Additionally, SBA uses reputable commercial contractors to collect loan fees and information on a quarterly basis. Any discrepancies are immediately reconciled.

Evidence: Approximately 95 percent of all 7(a) guarantee requests are submitted by lenders under an expedited process (PLP, SBAExpress, and Community Express). These loans received funding within 24 hours of receipt of the request (up from 71 percent for FY 2003 and 90 percent in 2004). Colson Services Corporation is the commercial service provider that collects fees and tracks outstanding loan balances.

Does the program have procedures (e.g. competitive sourcing/cost comparisons, IT improvements, appropriate incentives) to measure and achieve efficiencies and cost effectiveness in program execution?

Explanation: The efficiencies of the program are continually measured through the agency's activity based costing system and necessary improvements are implemented, including simplifying and centralizing the Agency's lending programs, reducing Agency staffing requirements and conducting periodic competitive sourcing of its functions. Private sector contractors are used by SBA to provide much of the processing, servicing and purchase centers staffing. These contracts are awarded on a competitive technical and cost basis through an RFP process. In addition, lenders do the bulk of the work associated with loan credit applications, loan servicing and loan resolution activities, and are encouraged through less paperwork and quicker turn around times which results in a more cost effective use of SBA's limited staff and resources.

Evidence: Activity based costing reports.

Does the program collaborate and coordinate effectively with related programs?

Explanation: The 7(a) program is used by many lenders in conjunction with the 504 loan program when the small business's requirements are for the acquisition of real estate together with working capital requirements; especially when the small business requirements exceed the $1.5 million 7(a) limit. (The 504 program's limits can go up to $2 million for a project that meets a public policy goal and up to $4 million for a manufacturer. ) It is also a public/private funding program in that the project is financed, usually 50 percent, by private sector, non-guaranteed financing that has a senior lien to SBA's.) Collaboration often takes place among SBA field office lending professionals, 7(a) lending participants and Certified Development Companies. This generally results in a strong combination of a long-term fixed rate mortgage financing under the 504 program leveraged with an unguaranteed first mortgage loan and a variable rate 7(a) working capital, equipment and inventory loan.

Evidence: 7(a) and 504 loan program comparison matrix.

Does the program use strong financial management practices?

Explanation: The agency uses private-sector financial concerns under contract to manage lender loan reporting and collection of on-going lender fees. In addition, SBA implemented an econometric credit model to improve subsidy cost estimates. Finally, SBA contracted in FY 2003 with a private sector business credit reporting organization to develop a Loan and Lender Monitoring System (L/LMS) that allows the agency to track lender performance relative to the credit scores of borrowers in the lenders' portfolios in combination with traditional portfolio stress identifiers such as delinquencies and defaults. This tool provides SBA with the ability to identify concerns in SBA's overall portfolio as well as concerns with specific lenders and take necessary corrective actions. OIG did identify concerns about the guaranty purchase process and the possibility of improper payments due to the centralization of the purchase process and an 85 percent reduction in the guaranty purchase review staff when the process was centralized. SBA continues to work in addressing these concerns by providing on-line training to lenders and fully staffing the center.

Evidence: Performance and Accountability Report - FY 2006, Lender Loan Monitoring System, Credit subsidy model, Draft OIG Report - Project No. 4032 dated 3/9/07

Has the program taken meaningful steps to address its management deficiencies?

Explanation: The Agency has identified 4 management challenges that relate to this program. The challenges cited by the OIG in the FY 2006 Performance and Accountability Report are "SBA's National Guaranty Purchase Center needs better controls over the business loan purchase process;" "SBA needs to effectively implement its participant oversight plan;" "Preventing loan agent fraud requires additional measure;" and "SBA needs to continue its efforts to update its system of directives to provide proper guidance and control over its operations." SBA has taken actions to correct many of the deficiencies identified by the OIG, such as issuing revised Standard Operating Procedures(SOPs) on loan servicing and liquidation, developing training modules, and training individuals responsible for the various processes. The Agency improved its oversight process by establishing a Loan and Lender Monitoring System (L/LMS) that identifies potential and actual financial risks in the portfolio and has established the Portfolio Analysis and Lender Oversight Committees. The Agency is using E-tran to capture loan agent information.

Evidence: The OIG identified the management challenges in the Performance and Accountability Report, FY 2006. Daily management and inventory reports are generated at the National purchase/loan resolution center which track the loans submitted by lender participants for purchase. These reports follow each loan through the various stages of the purchase process to final completion. The Office of Lender Oversight generates monthly reports on 7(a) and 504 participants for the purpose of analyzing risk assessment and determining lender reviews. Progress on both of these challenges is also tracked by the OIG and the Office of the CFO.

Is the program managed on an ongoing basis to assure credit quality remains sound, collections and disbursements are timely, and reporting requirements are fulfilled?

Explanation: The quality of the portfolio is managed through the relatively new (est. 09/2003) Loan and Lender Monitoring System (L/LMS) utilized by the Office of Lender Oversight (OLO) and the Office of Financial Assistance to monitor the performance (including default and purchase rates) and credit quality of each loan, lender portfolio, delivery method segment, and the overall portfolio. The lenders with larger portfolios, and that exhibit higher risk (worse ratings), in L/LMS, relative to their peers, are given the most attention through on-site risk based reviews and safety and soundness examinations. Smaller and less risky lenders are monitored and reviewed off-site using L/LMS. L/LMS and on-site reviews, along with other risk data such as call report and regulatory enforcement action data, are used in the review and approval of lenders' delegated lending authority applications to be able to make PLP, Express, and Community Express loans. For lenders exhibiting poor credit quality in their portfolios, the delegated lending authority can be suspended, or not renewed, or renewed for only an abbreviated period. In addition, riskier lenders face possible corrective and enforcement actions. The Sacramento Center uses lender fees and Guaranty Loan Status and Remittance Report (Form 1502) reporting as a factor in delegated lending authority application write-ups. Loans that are not reported on are changed into Delinquent status in the RISK database. The OCFO cash transactional databases (same one used in the Subsidy Model) is being researched as an additional source of data for L/LMS on fees, and has been tested as a source of data on recoveries. Finally, SBA uses an automatic system that notifies a lender that a loan will be cancelled after a loan has been in committed status for a set period of time; and, these loans are then cancelled if the lender does not respond.

Evidence: SOPs and regulations, Colson contract, Lender Loan Monitoring System

Do the program's credit models adequately provide reliable, consistent, accurate and transparent estimates of costs and the risk to the Government?

Explanation: SBA's econometric model for the 7(a) Business Loan program provides very reliable, consistent and accurate cost estimates. The model is continuously reviewed for accuracy and updated as appropriate for trends in the 7(a) program. Updates to the model are reviewed by Ernst & Young, LLP twice annually as part of SBA's Independent Validation and Verification process. The model, documentation, analysis of changes, actual to estimates comparison, sensitivity analysis, and control procedures are audited annually by SBA's external financial statement auditors.

Evidence: The material weakness in credit subsidy modeling that was reported by Cotton & Company LLP, SBA's external financial statement auditors for fiscal year 2004, was corrected in 2005. No write-ups were issued by Cotton & Company LLP, SBA's external financial statement auditor for fiscal year 2005, or KPMG LLP, SBA's external financial statement auditor for fiscal year 2006.

Has the program demonstrated adequate progress in achieving its long-term performance goals?

Explanation: For the "Number of jobs created/retained" long-term outcome measure, while the SBA tracks and reports the number of jobs created and retained by firms receiving 7(a) loans, the agency does not set targets. For the "Revenue growth for small businesses receiving SBA assistance" and "Business longevity for small businesses receiving SBA assistance" measures, the next Urban Institute report will compare revenue growth and business longevity between SBA assisted businesses and those that did not receive assistance. Upon receiving the Urban Institute report, SBA will complete a program evaluation on revenue growth and longevity for businesses receiving SBA assistance. At that time the SBA will be able to set a baseline and establish long term targets for these measures.

Evidence: Performance and Accountability Report. Five-year Strategic Plan. Next Urban Institute Report on Revenue and Business Longevity.

Does the program (including program partners) achieve its annual performance goals?

Explanation: The 7(a) program has significantly contributed to overall annual Agency lending goals, which focus on expanding loan volume and increasing penetration into the underserved markets. SBAExpress has particularly assisted SBA in achieving its lending goals while at the same time controlling risk through a reduced (50 percent) guaranty. While overall 7(a) loan approval volume over the last 5 years has increased over 88 percent, SBA Express has increased more than 278 percent. For FY 2006, SBAExpress represented 68 percent of total 7(a) loan volume. That being said, SBA failed to achieve many of its 2006 annual goals.

Evidence: SBA's FY2006 Performance and Accountability Report shows most goals as being achieved or substantially achieved except for loans to existing businesses. The PAR suggested that due to the dramatic increase in the prime lending rate during FY 2006, existing businesses may have delayed expansion plans.

Does the program demonstrate improved efficiencies or cost effectiveness in achieving program goals each year?

Explanation: Program costs have been reduced by increasingly relying on lending partners for origination, servicing, and liquidation functions. From 2003 to 2006, unit cost per loan has decreased from $2,778 to $461. Savings have been achieved through elimination of credit subsidy as well as administrative efficiencies. For example, by centralizing liquidation activities, costs have decreased from $32 million in 2003 to $13.6 million in FY 2006. The streamlining of 7(a) lending through the design and use of SBA Express, as well as the introduction of E-tran for SBA Express and PLP submissions beginning in FY 2003, resulted in SBA exceeding its loan number goal by approximately 10% in FY 2005. Additionally, the unit cost for SBA Express is almost 4 times lower than LowDoc and half the cost of PLP Loans. E-Tran is very important component of an overall strategy to provide increased efficiency and decreased costs in the loan guaranty origination process. With the introduction of E-Tran, lenders are able to electronically submit loan applications and receive immediate approvals from the Agency, thus reducing the 24 hour response time by the Agency.

Evidence: Activity based costing report. 2006 Budget submission.

Does the performance of this program compare favorably to other programs, including government, private, etc., with similar purpose and goals?

Explanation: The 7(a) program is designed to assist for-profit small businesses with their financial needs through guarantying loans made by lenders. The SBA guaranty reduces the lender's risk in case of default. When a 7(a) loan defaults, the lender requests that SBA purchase its guaranteed portion. The use of proceeds is wide-ranging and includes working capital, the acquisition of short and long term assets, and refinancing. In FY 2005, the 7(a) Loan Program became a zero subsidy loan program and continues to be a zero subsidy program. For FY 2007, the Federal Credit Supplement identified that the 7(a) program had commitments of $17.5 billion with an average loan size of $152,000. This would equate to approximately 115,000 loans. The default rate is 7.19 percent and recovery rate is 50.75 percent. The average percent guaranteed is 72.68 percent. Average maturity is 16 years. In comparison, the 504 Loan Program, which only finances long-term fixed assets, is a zero subsidy program with commitments for FY 2007 of $7.5 billion and an average loan size (not including the private sector, first mortgage portion) of $501,000. This would equate to approximately 15,000 loans. The default rate is 4.11 percent and the recovery rate is 40.84 percent. It has an average guaranty percent of 100 percent. Average maturity is 20 years. Fees are 2.75 percent. USDA's Business and Industry loans, a program that lends to rural businesses, both large and small, for general purposes, for FY 2007 has a subsidy rate of 4.36 percent and commitments of approximately $1.0 billion. The average loan size is $2.5 million and average maturity is 17 years. This would equate to approximately 400 loans. The default rate is much higher than 7(a) at 12.54 percent and the recovery rate is 34.16 percent, resulting in a default net of recovery rate of 7.40 percent. The fees are 3.04 percent. Percentage guaranteed is 80.58 percent.

Evidence: See response to 1.3. The GAO study, 00-220, page 30-32 . The independent study by the Urban Institute January 2007 Final Report: Public Sector Duplication of Small Business Administration Loan and Investment Programs: An analysis of overlap between federal, state, and local programs providing financial assistance to small businesses. Federal Credit Supplement

Do independent evaluations of sufficient scope and quality indicate that the program is effective and achieving results?

Explanation: The Office of Advocacy conducts various, independent studies regarding small businesses. An independent study dated May 2005 indicates that certain segments of the small business community experience a greater loan application decline rate. This supports one of SBA's long-term goals of providing financing to businesses facing special competitive opportunity gaps by providing SBA's guaranty to loans approved by lenders to this segment, reducing a lender's perceived risk regarding these types of loans. In addition, the Urban Institute published a study as of January, 2007, entitled "An Analysis of Overlap between Federal, State, and Local Programs Providing Financial Assistance to Small Businesses. One of its conclusions was that even though there were similarities among federal, state, and local loan and loan guarantee programs, SBA programs have higher maximum loan and loan guarantee amounts and longer terms than state and local programs.

Evidence: May 2005 - Research Study, Availability of Financing to Small Firms Using the Survey of Small Business Finances, submitted by Karlyn Mitchell and Douglas K. Pearce; Urban Institute study dated January, 2007, entitled "An Analysis of Overlap between Federal, State, and Local Programs Providing Financial Assistance to Small Businesses."