President Obama’s proposed government reorganization would fold the Small Business Administration into a new department designed to serve companies of all sizes.

While his proposal is pending in Congress, the president elevated the SBA administrator, Karen Mills, to cabinet status. If the reorganization is adopted, the administrator would lose that status.

In his Jan. 13 announcement, Obama asked Congress for authority to create a new cabinet-level department “with one website, one phone number, one mission: helping American businesses succeed.”

The department would comprise the business and trade functions of the Commerce Department (including the Minority Business Development Agency), the office of U.S. Trade Representative, the Export-Import Bank, the Overseas Private Investment Corporation, the U.S. Trade and Development Agency and SBA.

The president asked Congress to give him fast-track authority to reorganize federal agencies. Under that authority, Congress could vote his proposals up or down, but could not amend them. The White House said every president from Hoover to Reagan had fast-track authority.

Obama said the reorganization would save $3 billion over 10 years and eliminate 1,000 to 2,000 jobs in overlapping areas such as human resources.

The proposal is an attempt to mend fences with business and a challenge to Republicans, who have been calling for a smaller, more efficient federal government. Capitol Hill reaction was generally muted, with several Republican leaders saying they needed to see more details while criticizing the president for expanding government.

Brendan Buck, a spokesman for House Speaker John Boehner, said, “American small businesses are more concerned about this administration’s policies than from which building in Washington they originate.”

If the new department is created, SBA, now an independent agency with a separate budget, would become part of a much larger department. SBA’s small business contracting programs, which have no counterpart in any other agency, would be a small component of a department whose main focus was lending, trade and competitiveness.

“This integrated department will be about serving America’s businesses — small, medium and large — as they compete in the global marketplace,” said Jeffrey Zients, deputy director of the Office of Management and Budget, in a conference call with reporters.

Small business groups expressed skepticism, but said they need to know more about the proposal. “Right now small business has an independent agency that reflects its needs,” John Arensmeyer, chief executive of the Small Business Majority, told the New York Times. “The obvious concern is that by bringing this into a larger agency there’s a risk that some of that voice gets lost.”

Lloyd Chapman, president of the American Small Business League, called the president’s proposal “a move to eliminate small business programs.”

President Obama first proposed combining business-related agencies in his 2011 State of the Union address. Last year the Government Accountability Office identified 52 separate federal programs dedicated to “entrepreneurship.”

But governmental reorganization efforts have seldom been successful. Each federal program has its own champion in Congress, and members are usually reluctant to give up their pets.

With Congress on a campaign footing this year, chances for approval of the Obama plan are uncertain. If it stalls, SBA has a seat at the cabinet table.