Today, Representative Sharice Davids, a member of the House Small Business Committee, announced that the SBA Kansas City District Office has reached $124,580,140 in funding to small businesses in the Kansas Third District through 186 traditional loans for fiscal year 2021. As a direct result of these SBA guaranteed 7(a) and 504 small business loans, 10,662 jobs were created or saved in Kansas and Missouri in FY 2021.
Small businesses have been hit hard throughout the pandemic. In 2020, businesses with fewer than 500 employees reported more net jobs lost than larger businesses--but they also benefited from targeted federal relief aid programs, with 96% of 2021 PPP loans going to businesses with fewer than 20 employees.
In addition to pandemic relief aid, traditional SBA loan programs offer small businesses favorable terms and interest rates to help them purchase equipment, invest, grow, and thrive. Davids serves as Chair of the Small Business Subcommittee on Economic Growth, Tax, and Capital Access, where she has consistently advocated to increase access to capital for small businesses, introducing legislation like the bipartisan 504 Modernization and Small Manufacturer Enhancement Act to streamline existing programs and promote business growth.
The FY 2021 Regular Program loan totals for the Kansas Third Congressional District are:
7(a) Loan Program: 160 loans approved for $108,693,200
504 Loan Program: 25 loans approved for $15,884,000
Microloan Program: 1 loan approved for $2,940
"The Kansas City SBA as well as our local banks and credit unions have really stepped up over the past year to support our hard-hit small businesses, and I'm proud to support their efforts through my work on the Small Business Committee," said Davids. "It's great to see the loans made and jobs saved this year, but the road to recovery is long. I'm going to keep working to ensure everyone is included in our economic recovery."
The SBA's 504 loan program is a public-private partnership designed to provide attractive, fixed interest rate loans on large equipment and real estate projects for small businesses. Earlier this year, the House passed two of Davids' bipartisan bills to improve this program including by increasing maximum loan amounts and streamlining the loan process. Currently, under the 504 loan program, private lenders provide 50 percent of the project's financing, with the SBA supplying up to 40 percent and the small business 10 percent.
Under the 7(a) program, the SBA guarantees a certain portion of the small business loan will be repaid if the borrower defaults. An SBA guaranteed loan offers borrowers the potential for a lower equity injection and longer amortization with interest rates capped by the government.