Small Business 7(A) Lending Oversight Reform Act of 2018

Floor Speech

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Mr. KELLY of Mississippi. Mr. Speaker, I thank the chairman for yielding. In my district, the Small Business Administration has made tremendous and direct impact with the 7(a) Loan Program by helping small businesses that are not able to find or obtain capital through traditional or conventional markets.

To acquire a 7(a) loan, participating lenders must determine that a small business cannot receive credit elsewhere. In practice, this is called the credit elsewhere test. The test became the focus of my subcommittee hearing in March of 2017, when the Committee reviewed the 7(a) Loan Program.

As conservatives, we must safeguard American taxpayer dollars. A government guarantee program needs strong oversight to make sure adequate safeguards are in place. That is why 7(a) oversight must begin with the credit elsewhere test.

This is exactly what H.R. 4743 proposes. It strengthens the credit elsewhere test and provides transparency to factors most commonly used by lenders as they move small businesses through the 7(a) loan process. Additionally, H.R. 4743 increases the oversight capabilities of the Office of Credit Risk Management and the Lender Oversight Committee. These reforms will support the program while protecting American taxpayer dollars.

Mr. Speaker, I want to thank the chairman and the ranking member for taking up this issue and working with all Members to ensure oversight is paramount, and I urge my colleagues to support this much-needed legislation.

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