White House Plan for Emergency Relief for Sandy Includes Increases to SBA Bond Guarantees
Wednesday, December 12, 2012
In its plan for providing emergency assistance to victims of Super Storm Sandy, the White House included, at the request of the Small Business Administration (SBA), to increase the size of the bond that it can guarantee from $2 million to $5 million. The bond provisions are part of a $60.4 billion dollar aid package that the Administration has requested. The proposal still in a draft status and it remains to be seen whether this will be a permanent increase in the bond guarantee or whether it will be limited to projects related to Sandy.
Senator Ben Cardin (D-MD) will urge the increase in bond guarantees at a Senate oversight hearing tomorrow on the federal agency response to Sandy and small business recovery efforts. Cardin was the author of a bond guarantee increase to $5 million in the American Recovery and Reinvestment Act (ARRA), the 2009 economic stimulus package. He wanted to make the increase permanent, but ARRA expired and the SBA’s bond guarantee limited reverted back to $2 million. Senator Cardin has looked for every opportunity in Congress since the expiration to increase the SBA bond guarantee limit and has had the provision included in several bills, none of which has passed to date.
Cardin also included a provision in ARRA that the head of any agency could request a bond guarantee up to $10 million if the agency was involved in reconstruction efforts in a disaster area. That provision also was enacted in a small business disaster recovery act after Hurricane Katrina. Both of these provisions expired with the law that created them. Cardin has never sought to re-enact the disaster relief provision.
The Congressional debate on the disaster recovery package will be on the amount of the package and whether any such spending should be funded through increased revenues or cuts in spending elsewhere in the budget.
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