February 11, 2019

Cardin, Velázquez Request GAO Report on Impact of Trump Shutdown on Small Businesses

35-Day Shutdown Prevented SBA from Providing Much-Needed Support to Small Businesses

WASHINGTON – U.S. Senator Ben Cardin (D-MD), Ranking Member of the U.S. Senate Committee on Small Business & Entrepreneurship, and Representative Nydia Velázquez (D-NY), Chairwoman of the House Committee on Small Business, today sent a letter to Comptroller General Gene Dodaro requesting a Government Accountability Office (GAO) report on the impact of the 35-day Trump Shutdown on small businesses.

“SBA programs serve a vital role in promoting entrepreneurship, providing access to capital and contracting opportunities, and offering key counseling resources,” the Members wrote. “It is essential that Congress and the American public know exactly how the shutdown impacted SBA’s programs, the small businesses that rely upon them, and the small business sector at large.”

Thousands of businesses were harmed by the shutdown, which prevented the SBA from providing vital resources to small businesses and entrepreneurs, including access to capital, contracting opportunities and key counseling resources. The Members asked the GAO to evaluate the following areas:

  1. Impacts on small businesses that rely on contracts awarded by agencies affected by the shutdown;
  1. Impacts on small businesses that rely on SBA guaranteed and direct loans;
  1. Impacts on small businesses located in geographic areas that experienced significant closure of federal facilities, decline in government services, and decline in federal worker payrolls;
  1. Impacts on small businesses adversely impacted by closure of agencies that provide federal licensing and permits for small businesses;
  1. The amount of pay delayed for SBA employees; and
  2. Any other matters the Comptroller General deems important for addressing these issues. 

Cardin and Velázquez also requested that the GAO’s evaluation include an assessment of the SBA’s efforts to mitigate the consequences of the shutdown, as well as the opinions of SBA employees, lenders and stakeholders on how the shutdown was managed by the agency.

Click here for a PDF of the letter, the full text follows:

February 11, 2019

The Honorable Gene Dodaro

Comptroller General of the United States

U.S. Government Accountability Office

441 G Street, SW

Washington, DC 20548

Dear Mr. Dodaro:

As the lead Democrats of the Senate Committee on Small Business and Entrepreneurship and the House Committee on Small Business, we write to request that the Government Accountability Office (GAO) conduct an evaluation of the negative impact of the recent government shutdown on U.S. small businesses and the U.S. Small Business Administration (SBA).

As you know, thousands of small businesses were harmed by the federal shutdown that took place between December 22, 2018 and January 25, 2019. The halting of government services for 35 days affected both the SBA’s various programs as well as the greater small business community. SBA programs serve a vital role in promoting entrepreneurship, providing access to capital and contracting opportunities, and offering key counseling resources. It is essential that Congress and the American public know exactly how the shutdown impacted SBA’s programs, the small businesses that rely upon them, and the small business sector at large.

In light of these concerns, we request that the GAO evaluate, to the extent possible:

  1. Impacts on small businesses that rely on contracts awarded by agencies affected by the shutdown;
  1. Impacts on small businesses that rely on SBA guaranteed and direct loans;
  1. Impacts on small businesses located in geographic areas that experienced significant closure of federal facilities, decline in government services, and decline in federal worker payrolls;
  1. Impacts on small businesses adversely impacted by closure of agencies that provide federal licensing and permits for small businesses;
  1. The amount of pay delayed for SBA employees; and
  2. Any other matters the Comptroller General deems important for addressing these issues. 

In carrying out your evaluation, we would like you to consider actions taken by SBA, if any, to mitigate the negative consequences of the shutdown such as:

  • SBA’s communications with its lending and counseling partners before, during, and after the shutdown, and the viewpoint of SBA employees (in headquarters and the district offices) and key lending and counseling partners about how the shutdown was managed and ideas for best practices for an orderly shutdown and reopening; and
  • Actions to mitigate adverse impacts on lender oversight.

Thank you for your attention to this request.  

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