R40241
Small Business Provisions in the American Recovery and Reinvestment Act of 2009
February 25, 2009
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Summary
The American Recovery and Reinvestment Act of 2009 (ARRA, P.L. 111-5), which was signed into law on February 17, 2009, makes supplemental appropriations for many federal programs in an effort to mitigate the effects of the economic recession that began in December 2007. This report provides an overview of key provisions related to the Small Business Administration (SBA). The new law • Provides an additional $630 million for loans and loan guarantees divided into two categories: $375 million is set aside for reimbursements, loan subsidies and loan modifications related to certain loans, and $255 million for loan guarantees of $35,000 or less in a new small business stabilization program (BSP); • Provides $24 million for microloan technical assistance, and $20 million to improve lender oversight; • Provides an additional $6 million for direct loans; • Provides an additional $15 million for the SBA's surety bond program and increases the size of the maximum bond; • Eliminates (or reduces as much as possible) fees in the SBA's main business loan programs and for lender oversight; • Allows the SBA to guarantee certain loans that, in part, refinance existing business loans; • Authorizes the SBA to guarantee pools of first lien CDC/504 loans sold to third party investors; and • Makes changes to encourage SBA-licensed Small Business Investment Companies (SBICs) to invest more venture capital in small businesses. Most of the new programs will sunset February 17, 2011, two years after enactment. This report will be updated as warranted.
