Rubio, Colleagues Urge Small Business Administration’s Acting Administrator To Refrain From Issuing Final Lending Rule
May 22 2019
Washington, D.C. — Today, U.S. Senators Marco Rubio (R-FL), Ben Cardin (D-MD), Representatives Nydia Velazquez (D-NY), and Steve Chabot (R-OH), Chairmen and Ranking Members of the Small Business Committees, urged the U.S. Small Business Administration (SBA) Acting Administrator Chris Pilkerton to delay the promulgation of all components of the final rule titled, “Express Loan Programs; Affiliation Standards” until the agency has a Senate confirmed administrator in place. The proposed rule, issued on September 28, 2018 has drawn significant concerns from small business stakeholders and received more than 4,000 comments during the proposed rule’s official comment period. If made final, the rule will create changes for a majority of small businesses who participate in SBA’s lending programs, including a new personal resources test, limitations on lender and agent fees charged to borrowers, and reinstating standards of affiliation between small businesses and third parties. The bicameral and bipartisan letter strongly recommends that the new SBA administrator, once confirmed by the Senate and in place at the Agency, has a chance to properly review and analyze these policy changes before promulgation.
In February, Rubio discussed with former SBA Administrator Linda McMahon the proposed rule and questioned why the agency did not perform an adequate cost-benefit analysis to consider the rule’s impact on small businesses as required by the Regulatory Flexibility Act.
The full text of the letter is below.
Dear Acting Administrator Pilkerton:
We write to urge the Small Business Administration (SBA) to delay the promulgation of all components of the final rule titled, “Express Loan Programs; Affiliation Standards, 83 Fed. Reg. 49,001 (proposed Sept. 28, 2018),” until the Senate is able to confirm, and an administrator is in place, at the agency. With last month’s departure of former Administrator Linda McMahon, and the lack of a Senate-confirmed deputy administrator at the SBA, we are concerned about the agency promulgating a final regulation that will greatly impact the small business community, as well as entrepreneurs’ access to capital.
As you know, this regulation will have a significant impact on a substantial number of small businesses that participate in the SBA’s lending programs. Because of this, it is vital that the SBA performs all required analyses and thoughtfully considers the final rule, under the next administrator, before issuing it.
Thank you for your attention to this important matter.