In an unexpected turn of events, Patrick Kelley, Associate Administrator for the Office of Capital Access at the Small Business Administration (SBA), has abruptly left his position. This has led to bipartisan concern among leaders of House and Senate Small Business Committees, who have jointly penned a letter to SBA Administrator Isabel Guzman, expressing their apprehension over the implications of Kelley’s departure on proposed changes to the SBA’s 7(a) Loan Program.
In their open letter, the Committee leaders highlight the potential risks that could ensue if the planned changes to the SBA’s lending programs are hurriedly implemented without proper oversight. The departure of Kelley, they argue, has left a significant leadership void at a critical time when the SBA is implementing new lending rules.
Chairman of the House Committee on Small Business, Roger Williams, who was a signatory of the letter alongside Ranking Member Nydia Velázquez, Senate Committee on Small Business and Entrepreneurship Chairman Ben Cardin, and Ranking Member Joni Ernst, voiced his concern. He noted, “The unexpected and abrupt departure of Patrick Kelley from the SBA after testifying before the Committee on Small Business is extremely concerning.”
Despite their differing political ideologies, the signatories of this letter came together to draw the attention of the SBA to the gravity of the situation. They collectively urged the SBA to temporarily halt the proposed changes to the lending program, stressing the importance of their correct rather than quick implementation.
The letter further emphasized the need for stable leadership to ensure a smooth transition to the new lending rules. It pointed out that full guidance on these rules is still not available, thereby complicating the process for lenders to understand and comply with the changes.
In light of these concerns, the small business leaders in Congress emphasized the need for a permanent replacement for Kelley to be in place before the changes to the SBA’s 7(a) Loan Program come into effect. Such a move, they argue, would ensure that stakeholders get timely responses to their inquiries and that Congress can conduct the necessary oversight of the program changes.
The departure of a key official and the looming changes to the 7(a) Loan Program have underscored the importance of stability and oversight at the SBA. As the agency navigates these changes, the role of Congressional leaders in providing bipartisan oversight and advocating for small businesses becomes even more crucial.
Small business owners and lenders who will be directly impacted by the changes to the SBA’s lending programs will undoubtedly be keeping a close eye on how this situation unfolds. Their ability to access much-needed capital hinges on the effective implementation of these new rules and the appointment of an adequately qualified new Associate Administrator for the Office of Capital Access.
This article, “House and Senate Small Business Leaders Request Pause on SBA Lending Rule Changes Following High-Level Departure” was first published on Small Business Trends