Administration Budget Would Slash Key
SBA Micro Business Programs
Despite proven success of the Small Business
Administration (SBA) Micro-loan and SBA PRIME Programs,
the President has requested that Congress discontinue
funding for these programs in Fiscal Year 2005.
The potential loss of these vital federal funding
sources represents a critical threat to the future of
the American microenterprise industry and
microentrepreneurs across the nation. A microenterprise
is defined as a business with five or fewer employees.
While federal funding for micro-enterprise decreased
steadily over the past 3 years, microenterprises – the
nation’s smallest businesses – have played an
increasingly large role in our nation’s economy. Across
the United States, over 27 million microentrepreneurs
account for 17 percent of all private employment.
The Microloan Program is the nation’s largest funder –
public or private – of microenterprise capital and
technical assistance. For many very-low- and
moderate-income entrepreneurs, these programs represent
their only opportunity to receive business training, a
business loan, and a real chance at success through
For over 10 years, the SBA Micro-loan Program has
successfully served communities across America,
specifically in those areas suffering from a lack of
credit due to economic downturn. In 2003, the Microloan
Program provided over 2400 loans.
These are individuals who, despite facing challenges to
successful business ownership, strike out to make better
lives for themselves, their families, and their
communities. These borrowers are unique to the Microloan
Program and are not adequately served by alternate
government programs, as suggested in the
Administration’s 2005 Budget Proposal.
The PRIME Program is also unique in that it provides
business technical assistance to low- and very-low
income entrepreneurs across the country. The PRIME
Program provides business training regardless of whether
or not trainees seek business capital.
The Rural Enterprise Assistance Project (REAP) was
started by the Center for Rural Affairs in 1990 to meet
the needs of self employed people in the rural Midwest.
REAP is Nebraska’s largest microenterprise program and
operates on a statewide, rural basis through regionally
based Business Specialists. In fact, REAP is the
nation’s largest statewide rural microenterprise
REAP provides lending, training, networking, and
technical assistance opportunities for startup and
existing small businesses and has provided development
services to over 3000 micro businesses. REAP recently
reached the two million lending plateau for the history
of the program and has been an SBA Microloan
Intermediary since the program began in 1992. REAP is
also very proud to operate Nebraska’s only SBA