This time, the Small Business Administration appears poised to stick with the deadline it set for small firms harmed by the Sept. 11 attacks to apply for low-interest loans.
The deadline, now May 22, has been extended twice.
As part of the emergency loan program, nearly 8,000 businesses nationwide have received $715 million. In Illinois, 115 firms got $12.5 million.
To qualify, businesses must show they were directly and significantly affected by the terrorist attacks or the government’s response.
While this appears to leave a significant amount of gray area as to which firms are eligible, SBA spokesman Don Waite said the financial information provided by companies usually distinguishes those with real needs.
“Typically it’s something fairly dramatic,” Waite said. “You would be able to see from the sales figures that after September their sales dropped off considerably.”
Interest rates on the loans are up to 4 percent, and they have a maximum term of 30 years and a cap of $1.5 million.
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More than half of the loans, or $380 million worth, went to firms in the immediate area of the World Trade Center and Pentagon.
The rest, Waite said, went to a range of businesses around the country, from airport restaurants and limousine services to flight training schools.
Nearly $78 million went to Florida, which was hurt by the slowdown in travel.
The SBA has also started a separate loan guarantee program that gives banks incentives to lend to businesses that suffered as a result of the attacks. Qualifying for the Supplemental Terrorist Activity Relief (STAR) program is not as rigorous as getting an SBA loan, according to the agency.
The STAR program is scheduled to run until the SBA backs $4.5 billion in loans or January 2003.
For more information on the SBA emergency loan program, visit the government agency’s Web site at www.sba .gov/disaster/eidl.html. For more information on the STAR program, call the agency at 800-U-ASK-SBA.
Grade deflation: Goals set by federal agencies to steer more work to small businesses are increasingly being missed, according to a new report by Democrats on the House Small Business Committee.
The report graded 21 agencies, handing out 10 D’s and two F’s. Last year, 5 agencies received D’s and no F’s were given out.
“The situation is getting worse,” said Rep. Nydia M. Velazquez (D-N.Y.), the committee’s ranking Democrat.
Velazquez said the agencies were graded based on how close they came to accomplishing their stated goals.
The increased bundling of federal contracts, she added, has prevented small businesses from bidding on the work because of the size of the contracts.
In a recent speech, President Bush talked about the effect bundling has on small businesses getting federal work, but Velazquez wants specific measures in place to prevent the unnecessary bundling of contracts.
“It’s just not enough that the president recognizes that there is a problem,” Velazquez said.
Ironically, Velazquez pointed out, the SBA slipped from a C to a D- in the report.
But that grade can be misleading. The SBA spent more than 70 percent of its procurement dollars on small businesses last year. However, the agency was marked down for not reaching its aggressive goals in contracting with businesses run by minorities and economically disadvantaged individuals, as well as firms located in areas with low incomes and high unemployment.
Overall, the report found that government agencies widely missed two goals: While the government sought to spend 5 percent of its money on women-owned businesses, it spent only 2.49 percent. And while it wanted to dedicate 2 percent of contracts to businesses in low-income, high-unemployment communities, it spent only 0.72 percent.
Contract clicking: Several Web sites under construction will aim to help government agencies as well as companies quickly identify disadvantaged, minority and women contractors.
SBA hopes to have an online exchange, where small businesses can create Internet storefronts, live by October.
Two local groups, the Women’s Business Development Center and the Small Contractors’ Network, have received grants to create similar sites for area businesses.
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Contact rdkaiser@tribune .com