Federal Small Business Administration (SBA) unveils extensive restructuring, eyeing a 43% reduction in workforce size

Federal Small Business Administration (SBA) unveils extensive restructuring, eyeing a 43% reduction in workforce size

The U.S. Small Business Administration (SBA) has announced a comprehensive reorganization plan, aimed at returning the agency to its original mission of supporting small businesses. The plan, which is authorized under Executive Order 14210, is designed to address concerns over the SBA's expansion during the Biden Administration and the subsequent deterioration of services and financial performance.

The reorganization sets a goal of having 30% of agency staff located in the field to decentralize services and improve outreach to Main Street businesses. This move is expected to save taxpayers over $435 million annually by Fiscal Year 2026.

The plan prioritizes risk management and fraud prevention through centralization within the Office of the Chief Financial Officer. It also aims to reverse the "expansive social policy agenda of the prior Administration" and expand support for capital formation by shifting resources away from progressive programs.

The SBA estimates $200 billion in PPP and COVID-EIDL fraud during the Biden Administration. In response, the reorganization eliminates redundant pandemic-era positions associated with loan processing in the Office of Capital Access. The plan also increases disaster recovery support by transferring loan servicing responsibilities and personnel to the Office of Disaster Recovery and Resilience.

The reorganization includes a 43% reduction in the SBA's workforce, with the elimination of about 2,700 of its approximately 6,500 active positions. However, the Office of Advocacy and the Office of the Inspector General will be exempt from these reductions. The average SBA salary is more than $132,000.

Core services such as SBA's loan guarantee programs, disaster assistance, field operations, and support for veterans will remain intact. The Office of Veterans Business Development and the Office of Manufacturing and Trade will retain existing staffing levels.

The reorganization is part of a broader effort to return the SBA to its original focus on supporting small businesses. The SBA's claims that changes to the 7(a) loan program had resulted in increased defaults and negative cash flow during the Biden Administration. The plan aims to address these issues and improve the overall financial performance of the agency.

It's worth noting that the search results do not provide information on the person who assumed the function of SBA administrator (SBA-Verwalterin) in the year 2021.

In conclusion, the SBA's reorganization plan is a significant step towards addressing concerns over the agency's expansion and financial performance during the Biden Administration. The plan aims to decentralize services, improve outreach to Main Street businesses, and focus on risk management and fraud prevention. The reorganization is expected to save taxpayers over $435 million annually by Fiscal Year 2026 and is part of a broader effort to return the SBA to its original mission of supporting small businesses.

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