Are We Doing Enough to Help Small Businesses?

The stimulus bill is a great starting point in helping NEW small businesses. However it does not address the urgent needs of small business owners who currently own their buildings, made possible through help of an SBA 504 loan. Everybody acknowledges that mortgage relief for home owners is a necessity. However, the foreclosure crisis for small business owners is as serious and it has a ripple effect throughout the broader economy. Over the past 25 years, over 100,000 entrepreneurs have purchased a “home for their business” using SBA 504 loans. Existing regulations do NOT contain sufficient modification provisions to protect SBA 504 borrowers from foreclosure. . Barbara is proposing changes to servicing existing SBA 504 loans which will enable small businesses to remain operating in their buildings and prevent foreclosures. Many of today’s borrowers have discovered that their SBA loan has trapped them in a building that they can no longer afford, the value of the property is less than the total loans outstanding, and , given the uncertainty in the economy, there are simply no buyers for these properties. Just like the homeowners who owe more than the value of their homes, and can not sell them, there are thousands of small businesses who can not continue to make their mortgage payments. Losing their buildings likely will mean shutting their businesses and putting all of their employees out of work, which, in turn will exacerbate the home mortgage

As a small business owner and SBA lender the problem with SBA is lack of products and pressure from the banking sector. Banks are not lending and will not begin lending until the matter of "toxic assets" is resolved. Banks are not looking for a bailout but corporate welfare - they want the government to purchase the assets at a cost that will not impair their earnings. If the government would agree to a guaranty on all "toxic assets" the banks would begin lending again. Look at the the banking reserves at the St. Louis Fed site. The reserves have increased from around $40 billion to $800 billion in the past three months. They are not going to lend - I think we need to get to this answer sooner than later. directly lending for a 12-18 months period until the banking matter is resolved. Until than, small businesses will continue to struggle and close their doors as access to capital is denied and restricted. Everyone says, the government is inefficient so the SBA would be unsuccessful. I would ask, if government is inefficient than what would you say as to the efficiency of the private sector. The private sector's answer to this credit crisis is to - not lend, build reserves, wait for a government solution and handout and let business close - if that is efficient than we have huge problems with the definition of efficiency.

I am the President of TMC Development(Top 5 SBA Lender Nationally).The stimulus bill is a great starting point in helping small businesses.However it does not address the needs of small business owners who currently own their buildings, made possible through help of an SBA 504 loan. Everybody acknowledges that mortgage relief for home owners is a necessity. Much focus has gone to the residential mortgage crisis, and keeping home owners in their houses. The parallel problems associated with SBA commercial mortgages given to small businesses so that they could own the building in which their businesses operate have not been addressed.The foreclosure crisis for these small business owners has a ripple effect throughout the broader economy. Over the past 25 years, over 100,000 entrepreneurs have purchased a “home for their business” using SBA 504 loans.I propose changes to servicing existing SBA 504 loans which will enable small businesses to remain operating in their buildings. Given the extraordinary circumstances we are now faced with, existing regulations do not contain sufficient modification provisions to protect SBA 504 borrowers from foreclosure. Many of today’s borrowers have discovered that their SBA loan has trapped them in a building that they can no longer afford, the value of the property is less than the total loans outstanding, and , given the uncertainty in the economy, there are simply no buyers for these properties. Just like the homeowners who owe more than

Hello Alexis, What i am seeing is that people are scared and are not doing anything that they do not have to do. I am a small business owner.I have friends that are business owners.We are tired of busting our butts and giving so much of our money to the government.The government just wastes it on so much and that it is very frustrating. I have been predicting that the market will fall because there is no way that we could keep going on like this.All this debt has to be paid back.Unless something big time is done,I and other people feel that we will have a bad depression. This country has to get back to being self sufficient again.That is why we are or were a super power.Our politicians cannot be trusted.They have proven that time and time again.Example is when they said we were not in a recession and we were. I have talked to alot of people that believed the government,kept there money into stocks,retiremnt etc.and have lost almost everything or almost everything.I know that you know alot of this already.Our government is completely out of touch with the reallity,it is very scary. The people feel that the government does not care about us.They spend OUR money all over the world and fill there pockets,but do not look out for us.ALL BARK AND NO BITE.What needs to be done is to let these companies fall.The government is not going to bail me out if I need it.It is not the tax payers problem or there fault that these companies or our government cannot manage there own house thanks

Small businesses are getting crushed right now. The industries that surround travel, leisure, food, wine are all down significantly. When we really need a leader that is going to work in a bipartisan way for the country, instead we get Obama, intent on pushing through his radical socialist programs while turning a blind eye on the markets. Moreover, it is clear he and his economic team have no clue how to fix the economy. Nor will it happen unless he embraces capitalism and rejects the failed policies of socialism. How did we get here......

SBA is an excellent tool when ustilized properly. I have led SBA lending groups for over a decade at several banks, both big and small, and now own two small businesses. Most banks used SBA like mortgage lender's used their secondary markets. Used the system to make bad loans because a lack of oversight. Pure greed. Politicians involvement just gets in the way. Bureaucrats running a lending business letting bad industry practices go unchecked for years because they were afraid of shutting down large SBA loan producers. They should have third party auditors located in each state that have lending and specifically SBA lending background do ongoing audits. People who are willing to tell the SBA the truth about what is going on out in the marketplace, good and bad. SBA is going to a credit scoring system to help drive the triggers for potential audits. More automated mindless decision-making from Washington on a model that is untested. The agency needs people in leadership positions that have practical, real life experience as bankers. SBA lending is personal, one-on-one relationships with the borrowers. The folks at SBA have no clue what that means and their model reflects their ignorance. Credit Scoring models are what helped get us into this mess to begin with. I am out of banking but consult with small local banks and economic development groups to try and figure all of this out as it is shoved down their throat. Feel free to contact me to get first hand info 6105684647

No we are not doing enough, but we could do so much more. We have recently launched the new FundingRoadmap.com, an online business plan and due diligence reporting system to replace paper based business plans for entrepreneurs to use when applying for funding. Funding Roadmap is a standardized, SBA compliant, comprehensive and transparent vehicle for funding applications, analysis and approval that digitizes an outdated paper-based and template-driven process. The engine of our economic growth is the creativity and ambition of millions of entrepreneurs, and our online platform is a timely matchmaking tool for the marriage of capital to these new expanding businesses. The Funding Roadmap system provides the kind of disclosure and transparency that will rebuild the confidence necessary to accelerate the flow of capital into the hands of more compliant and successful companies. President Obama said "We have to have the private sector involved." It is now the SBA's/ resource partners, responsibility to incorporate the best technology available from the private sector which is the Funding Roadmap Online Business Plan and Due Diligence reporting system to their service and advice programs. It's time to provide an online alternative too, and replace outdated templates and ineffective narrative paper based business plans, (most of which never get read by investors) to bring the kind of change our country so desperately needs. American Entrepreneurs need this technology now

Alexis, You are so right.Here is what we are doing about this problem. We have recently launched the new Funding Roadmap, an online business plan and due diligence reporting system to replace paper based business plans for entrepreneurs to use when applying for funding. Funding Roadmap is a standardized, SBA compliant, comprehensive and transparent vehicle for funding applications, analysis and approval that digitizes an outdated paper-based and template-driven process. The Funding Roadmap system provides the kind of disclosure and transparency that will rebuild the confidence necessary to accelerate the flow of capital into the hands of more compliant and successful companies. The engine of our economic growth is the creativity and ambition of millions of entrepreneurs, and our online platform is a timely matchmaking tool for the marriage of capital to these new expanding businesses. It is now the SBA's and its resource partners responsibility to incorporate the best technology available from the private sector which is the Funding Roadmap Online Business Plan and Due Diligence reporting system to their service and advice programs. It's time to provide an online alternative too, and replace outdated templates and ineffective narrative paper based business plans, (most of which never get read by investors) to bring the kind of change our country so desperately needs. American Entrepreneurs need this technology now.

I'm a small business owner with 120+ employees. As a benefit to my employees, my company pays the bulk of employees' health insurance costs. However, health insurance benefits costs for my company are increasing 17% this year, which seriously impacts my ability to continue providing a meaningful benefit. If the Obama Administration is serious about helping small business, it should allow health benefits to be a tax deduction instead of merely an expense. A tax deduction approach would provide a win-win for employees and small businesses by allowing the businesses to support more of the incremental cost increases through the dollars saved by the tax deduction.

Alexis; I wanted to personally send a letter and thank you for caring about small businesses and the crisis which is affecting them in every country, because they are the backbone of a country's economic and future growth, but so many of them never survive or even make a profit. We do not do enough for small and mid-sized businesses and that is why my mission is: Increasing the Success Rate of Small and Mid-Sized Businesses! My Goal Is To Do 3 Things For Small And Mid-Sized Businesses Reach, Teach and Send! I want to Reach as many small and mid-sized businesses as I can. I want to Teach every small and mid-sized business owners and those associates, rock solid, time tested principles for their individual and company’s success. “And then, because words are meaningless without actions behind them” I want to Send small and mid-sized businesses into motion with concrete, corrective action plans to implement TODAY, so that the owners and associates have a tomorrow to look upon. If you like to discuss future opportunities with me, I would welcome hearing from you. Thank you for your time and attention and I look forward to your reply, make it a great day. Dedicated to the Mission! Tom Marquardt, The Profit Repairman®

Alexis, both you and Georgette are right on the money. As an owner of 2 small (B2B) businesses, one 18 years old and the other 8 months old, CAPITAL is what we all need. The problem we have in Washington is that 99% of them have never stuck their necks out and mortgaged their homes, leveraged their credit cards to make payroll, and worked deals with suppliers. That's what I signed up for so I'm not complaining, rather explaining. How many in Congress would do that to keep the payroll full and not lay people off? I am doing it right now! The SBA is a joke. None of the people who run it have ever put themselves in the above described position. Its mission is blurred by minority lending habits. Most of us small business owners would rather finance our businesses without banking assistance. They are "holier than thou." We're the guys who ought to be testifying on Capitol Hill and being interviewed by the media! Good discussion.

Save the auto Companies and do the green thing with cars at the same time. Bailouts won't save any GM jobs - stimulating GM car sales saves GM jobs. Use the auto and comsumer bailout funds to guarantee token interest, 10% down new car auto loans. ALL BUYERS QUALIFY. Guarantee at least $4k cash credit, regardless of car condition or lien, for every new car buyer that 'trades' in for scrap a 'non-green' car that is older than say five years. Get the non-green ones off the road. Get the green cars sold. Get the assembly lines rolling.

I have been involved in SBA lending for the past 18 years, in various positions, for various banks and finance companies. As usual, Washington has completely missed the point. If you want to encourage small business lending, then eliminating the fees and increasing the guaranty percentage is like amputating a toe for a heart attack (that's one part we don't have to supply with blood). The one thing that is paramount to increasing SBA lending is opening up the secondary market. If the $4-5 billion in loans presently held by SBA lenders and loan poolers were to be suddenly bought up by the government and the liquidity returned to the buyers/holders of SBA 7(a) guaranteed loans, they could begin to buy new loan production. This would provide access for main street companies to borrow much-needed funds. These funds could go toward new hiring, paying payroll and expanding their businesses. So many SBA lending companies (and banks) have left the SBA market (some estiamtes are as high as 75%) because they could not profitably make loans and maintain them in their own portfolios. If these same lenders could sell their loans, replenishing their liquidity and lend it again and again and again, this would significantly improve the national economy and improve the small business environment. And, hopefully put some of the 2-3,000 SBA lending personnel back to work, doing what they do best...feeding America's small business engine with the capital necessary to grow and prosper.

Bottom up growth means that SBA needs to be made flush with lending capacity to small businesses. Restrictive lending guidelines need to be unleashed from the existing small businesses that did their due diligence but have still been slammed by the hemmoraging markets. I'm a builder. A Producer .... of wealth. I had $4m+ in new home packages under contract. Presold with straightup sales contracts and appraisals that were backed up by loan commitments. Seven months later the Lenders could not deliver on the loan commitments because the credit, LTV and appraisal guidelines had changed. Who carries the homes in an RE market that has also tanked? The Builder! A small business whose credit lines are backed by what? -- Real Estate! Real Estate values that have tanked. Equity vaporized. Cash reserves emptied by interest payments to Who? The Lenders that couldn't deliver on loan commitments! Why couldn't they deliver? Because they delivered on other commitments that they should not have! Drop the LTV 20%. Secure it with a property whose value has plummeted 40%. What have you got? A credit line reduced by almost 70%!

I can answer this without reading the blog. Of course not!!! The swine in washington could care less about small business or the average tax payer. All the swine care about is power...they are all perfect and never do anything wrong. America will do much better when our people learn not to depend on these clowns. Enough said!

Alexis, I am a small business owner with a BIG IDEA. You said "We need to talk about this until we are blue in the face." I have been talking about this since the Dot Com crash.Know one is listening. "What do you recommend?" Here is what I have built. It's called the www.fundingroadmap.com. The engine of our economic growth is the creativity and ambition of millions of entrepreneurs, and our online platform is a timely matchmaking tool for the marriage of capital to these new expanding businesses. The Funding Roadmap system provides the kind of disclosure and transparency that will rebuild the confidence necessary to accelerate the flow of capital into the hands of more compliant and successful companies. President Obama said "We have to have the private sector involved." We are here, and cannot get through to any one in his administration. He said he wants to "Improve technical and contracting assistance to give entrepreneurs a greater level of counseling and business development." We have been trying to get the SBA and SBDCs/SCORE to work with us, but systemic and bureaucratic inertia prevents timely implementation of meaningful changes. It's time to provide an online alternative, and replace outdated templates and the economic implosion has underlined the relevance and urgency of the Funding Roadmap online reporting system now!

No incentives for trying to become solvent. Only interest on loans is deductible so of course the longer you have a loan without refinance the less your deduction....BUT your payment remains the same. Non-interest portion of payments are considered income thus taxable. Re-investment dollars become less if you try to become more solvent. If more companies had been more solvent we may not be in this mess. I would think total loan payments should be deductible as true expense, not just the interest. I know in my case (a small company with 5 employees) this policy keeps me from adding one more.

As small business owners, my wife and I are frustrated with both the coming tax increases as well as the ever increasing burdens placed on us via health care, punishing regulations, and business-unfriendly tax and fee increases on the local level. More and more is demanded from our hard work and all while we are also dealing with collapsing demand in this horrible economy. We simply cannot absorb these ever increasing demands and will be forced to improve our bottom lines via the one thing we can control: employee head count. That is, we will have to lay off employees, which is painful on many levels. We are even more frustrated given the size and scope of the stimulus. It's like Obama is Santa, bestowing many gifts upon the masses, some of which were not very good this year. And it's the biggest spending spree ever for Santa and there is much cheer. What's in the bag for small business owners? A pair of socks. And a letter saying Santa not only took the cookies and milk, but a third of your inventory as well. We are blowing a hole in the buget we may never be able to fill. At least not if we take away shovels from the productive and hardworking risk takers. Obama is ignoring the most potent force for job creation. Small business owners are huge spenders in the economy as well. Not only are the crumbs thrown at us insulting and ineffective, but the coming tax hikes are going to jeopardize any potential recovery. This administration is doing just the opposite of Reagan and the results are going to be dire. We have a financial services firm and we can see all of our clients bracing for impact. Defensive posturing by the 'wealthy' is incredibly destructive to the economy. The out of control spending will be met with aggressive treasury revenue decreases. We knew Obama would be bad for business, but we are shocked at just how bad.

Being a small biz owner, i poured through the all new docs and legislation in hopes of some small biz stimulus. I don't need a bailout. I don't need a handout. What I need are programs that help me maintain expenses and infuse cash (loan, LOC, etc) to get through this tough time. Survival is the game now. Austerity, not prosperity. What ticks me off the most is I work 80 hours a week to keep people working and keep our business alive. Never asked or will ask for a hand out. Yet our entitlement society waits for gov't to save them. When did hard work, success and tenacity become a negative and laziness, apathy and being self-centered become a positive?

We are Also concerned about the proposals to: 1) Increase tax rates for those making over $250,000 is for the most part a tax on small business. Small biz. owners usually take out much of the retained earnings to avoid double taxation and reinvest it back into the business. 2) Reduce tax deductions for those earning over $250,000 (see #1) 3) Increase Business taxes (see#1) 4) Tax $600 billion for Gov. health care. We pay for our employees health care now. This tax will push the cost up and we may have to opt out. These will force us (a small biz.) to: 1) Freeze capitol equipment expenextures 2) Freeze wages 3) Freeze hiring (or lay off) 4) Eliminate company paid health care plans Hard to see how this will stimulate the economy and create jobs.

I don't understand what the government is doing. the stimulus package had 700 million for small business that was to offset fees charged to banks to make loans, and for the SBA (slow butt administrators) to oversee the "help". how does that help small business? It helps the banks for sure. They would have done better with simply subsidizing apprentice programs where unemployed workers could work in a new trade at a small business and offset the employee cost by the unemployment benefits. it wouldn't cost any more, it would help small business, it would retrain displaced workers, and restore some confidence in the market place. that would at least offset some of the required expenses small business has to eat like workers comp insurance and unemployment insurance and the new tax increases. but no they create more government jobs, and tax small business to pay for it. I have let all my employees go because sales are so slow. my customers are working class and they are not working. and while I'm on a rant can someone get Obama to stop making so many speeches, every time he speaks the market crashes and spirals this whole thing further down the toilet.

I am a small businessman in California. Our sales have deteriorate 50% from the peak in 2005. Since then there has been a steady decline which accelerated last September and which seems to be taking another leg down. I've been cutting expenses like crazy for the past 2 years but never seem to cut enough to get back in balance. There have been 2 layoffs and reduction in hours. My bank is considering closing my small line of credit. I've got another bank looking, but I'm not sure what they will do. My recent numbers are bad. I've got a little bit of personal capital if need be, but that will be the last for me. None of the elements of any stimulus plan that I know about will help me and my employees at all. I am very discouraged because Mr. Obama does not seem to have a handle on this, nor does Mr. Geitner who has not even filled any of the deputy jobs in his department. Mr. Biden told one small business owner that a new bridge in her state might get more customers over to her side. That very stupid sounding answer won't work for my business. Bottom line, if no direct help can be offered, then the best plan from my point of view would be for targeted tax cuts so that more capital is available in the economy. Earmarks and budget increases won't help me either.

Hi - I watched some of the debate this morning and thought to myself - these people are exactly like the politicians, they think a problem is solved by throwing more money at it with strings attatched of course. I use to employ 25+ peple in a construction business, I am now down to 2 and have no desire to hire. When you hire today it comes with too much regulations from government and an entitlement attitude from employees. I addition, the competition hires illegals and government does nothing to enforce the law. If our government really wants to help, I feel that providing universal health care could relieve a little of the burden and possibly level the playing field for big and small business. We need government to help by getting out of the way.

Problem is the financial experts don't have an efficient "exchange: to invest in the small sector... the old regional stock exchanges were created for this... but have gone away. Frankly nor is Wall Street particularly interested in funding small companies... As one Wall Street leader suggested.. "There are no small deals... just small commissions". Further... Traditional Stock or Equities just are the wrong investment product to invest in small businesses which have no ability to exit or liquidate investment holdings -- and unfortunately the "value" of being public is limited to the 3500 actively traded stock -- the 80% that "Fail" to the OTC or Pink Sheet arenas just don't want to be public... and existing stockholders (versus traders) you can expect just don't want to be there either. On a self-serving basis we developed TIGRcubs, Top-Line Income Generation Rights Certificates, to provide investors a high yield monthly investment vehicle, in a non-dilutive manner to small businesses... those less than 250 million dollars in revenue. The 99.9% of the companies in America. This TIGRcub takes a small percentage of revenues every month... and distributes it to the certificate holder every month... and yields a return commensurate with risk to the investors -- WHILE PROVIDING AN EFFICIENT INVESTMENT VEHICLE TO INVESTORS AND THE COMPANIES! Wall Street is Broken: Entrepreneurs need to solve it bringing back employment and economic growth -- But access to capital is key!

I find it hard to believe that a tax increase will only hit 3.5 percent of small business owners if they are defined as employing under 500 people. I employ only 25, and make far more than 250k. Obamma does not seem to understand that those of us in small business take much risk, and we must make certain after tax profit margins to justify our risk. If profit margins are not met, then I will be cutting cost, that that includes benefits and jobs. It's as simple as that. Higher taxes will impede my ability to grow and hire new employees, and flourish, end of story. Obviously, the president has no clue how business works, and is in fact anti-business. Raising taxes on small business owners will do nothing but deepen this recession.