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Federal Market Intelligence for Small Business |
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Trump seeks authority for up to $4M in gifts for SBA in 2020SBA to get less fed’l money; GovCon/BD is flat funded; SBA cash gifts have been problematic in past: reportsPresident Trump is asking Congress to allow the Small Business Administration to receive up to $4 million in cash or in-kind gifts in fiscal 2020, which appears to be a large increase from past gifts to the SBA. The request for the SBA to receive millions in cash and donations is presented without explanation in the president’s budget request submitted to Congress earlier this month. It’s on the first page of the SBA section of the appendix. SBA is allowed to receive cash and in-kind donations for its mission, but generally in the past the amounts have been relatively small. According to an audit dating from 2017, the SBA deposited about $105,000 in cash donations made to the agency the previous year. Managing the cash gifts also has presented problems for SBA. SBA officials were not immediately available to explain the request. Overall, the president requests that SBA would get a federally-funded budget of $665 million, a 5% decrease from the fiscal 2019 enacted budget. At the same time, SBA would be authorized to increase or otherwise change its fee structure for small business loans, resulting in up to $820 million in total budget authority in fiscal 2020. Contracting, IT, entrepreneurship SBA’s Government Contracting and Business Development unit would get $29 million in fiscal 2020. The unit got $28 million last year and $29 million in fiscal 2018. There is $6 million to upgrade SBA's existing headquarters and $2.5 million for “further systems development” needed to implement the Women-Owned Small Business Certification Program, the president’s request states. Another $2.5 million is sought to conduct a “comprehensive evaluation” of the Small Business Investment Company (SBIC) program, and to “develop a plan to ensure that SBICs provide innovative and modern financial services to American small businesses.” In addition, the budget proposes the creation of a competitive set-aside within the SBDC program that would reward the centers that are most cost-effective and have the most innovative programs. Further details were not immediately available on proposed funding for the SBA’s entrepreneurial development programs, which in addition to SBDCs include the HUBZone program, Boots to Business for veterans and Women’s Business Centers. The budget documents show overall outlays for entrepreneurial development programs reducing to $204 million in fiscal 2020, down from $222. SBA officials were not immediately available to explain the decrease. Cash and gifts to SBA SBA officials were not immediately available to explain the purpose of the $4 million requested in a cash and gift allowance for the SBA. allowed the SBA to receive cash and donations, with proper approvals and a determination that there were no conflicts of interest for each donation. A 2017 review by the Office of Inspector General found that SBA’s handling of that authority was problematic. The SBA deposited $105,237 in cash donations it had received in that year and made it available for SBA program usage, which was within the law But the inspector general noted that SBA could improve its controls over the money. “We noted exceptions regarding the vetting of cosponsors and performing the conflict of interest determinations, complying with SBA and Federal guidance when utilizing gift funds, and tracking gift funds that were allotted to the program offices,” the OIG wrote in a 2017 audit report.
More information:
SBA Proposed Budget: https://bit.ly/2uooRmH
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