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Friday, April 2, 2010

Small Business Provisions in the American Recovery and Reinvestment Act of 2009

N. Eric Weiss
Specialist in Financial Economics

Oscar R. Gonzales
Analyst in American National Government

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). P.L. 111-5 provides a total of $730 million to SBA. Specifically, the act provides (1) 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) also known as America's Recovery Capital (ARC) loan program; (2) $30 million for expanding SBA's microloan program; (3) $25 million for staffing up to meet demands for new programs; (4) $20 million to improve lender oversight; (5) an additional $15 million for SBA's surety bond program and increases the size of the maximum bond; and (6) $10 million for the Office of Inspector General. 

P.L. 111-118, the Department of Defense Appropriations Act, 2010, enacted on December 19, 2009, provided an additional $125 million to extend modifications to the SBA's loan guarantee programs under ARRA through February 28, 2010. P.L. 111-144, the Temporary Extension Act of 2010, enacted on March 2, 2010, provided $60 million to extend those modifications through March 28, 2010. H.R. 4899, the Disaster Relief and Summer Jobs Act of 2010, would provide additional funding and extend the programs until April 30, 2010.

Date of Report: March 24, 2010
Number of Pages: 9
Order Number: R40241
Price: $29.95

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