Association for Enterprise Opportunity Announces Support for FSGG Funding Bill and Thanks Bipartisan Main Street Champions
Washington D.C. – The Association for Enterprise Opportunity (AEO), a national nonprofit organization dedicated to the development of a robust marketplace for underserved microbusinesses, is proud to announce its support for the Fiscal Year 2020 Financial Services and General Government (FSGG) funding bill that is headed to the House for a full vote. Providing annual funding for a number of agencies including the Department of the Treasury and the Small Business Administration (SBA), the bill is essential to ensuring the success of America’s smallest, yet mightiest businesses. AEO asked appropriators and champions on the Hill to increase funding for critical programs that impact microbusinesses. The organization continues to work with the Appropriations Committee and the House Small Business and Financial Services Committees to ensure that AEO’s members’ priorities–including increased funding and modernization of the lending programs– are heard.
“Microbusinesses make up more than 90% of all businesses in the country and the FSGG funding bill directly impacts their access to capital and technical assistance,” said AEO President and CEO Connie Evans. “AEO is proud to be a vocal part of the campaign to increase funds allocated to the Microloan and Microloan Technical Assistance programs, as well as to the Community Development Financial Institutions (CDFI) Fund. AEO thanks these programs’ bipartisan champions in the House for their support and appreciates their willingness to hear AEO’s recommendations on resource allocation. Their commitment to accelerating the growth and stability of Main Street businesses is reflected clearly by the increased funding to these critical programs.”
AEO was instrumental in the drafting and passing of legislation that created the original five-year pilot of the Microloan program in 1992. Conceptualized to assist entrepreneurs that historically face barriers in accessing capital such as women, minorities, veterans, and lower income people, the program gives small business owners loans up to $50,000. In the proposed FSGG bill, Treasury is allocated $13.56 billion– $793.9 million above the 2019 enacted level and $484.4 million above the President’s budget request. $46 million is allocated for the Microloan program,an increase of seven million dollars over the fiscal year 2019.
The SBA receives $995.8 million in the bill, an increase of $280.4 million over fiscal year 2019 and $228.7 million above the President’s budget request. Of that amount, $281.8 million is earmarked for Entrepreneurial Development Programs, including $35 million for Microloan Technical Assistance– an increase of $4 million over 2019 enacted levels. Technical assistance programs help educate and guide small business owners through issues such as ensuring compliance with regulations, expanding to international markets, building an effective online presence, preparing loan applications and taxes properly, creating an effective business plan, and much more. In AEO’s 2016 report, Reimagining Technical Assistance: Shifting the Support Landscape for Main Street ,the organization found a 30% difference in average annual revenue growth for a sample of businesses that received technical assistance compared to their peers that did not.
CDFIs—which include banks, credit unions, loan funds, or venture capital providers– are dedicated to expanding economic opportunity in low-income rural and urban communities by providing access to financial products and services. In fiscal year 2018, the CDFI Fund was appropriated $250 million, which CDFI Program awardees turned into more than $11.1 billion of reported lending and investment activity, financing nearly 16,000 businesses, over 33,000 affordable housing units, and financial literacy training for more than 340,000 individuals. While the President’s fiscal year 2020 budget included an elimination of the CDFI Fund, the current FSGG bill draft sets aside $300 million for the Fund, an increase of $50 million over 2019.
As the leading voice of innovation in microfinance and microbusiness in the United States, AEO and its member and partner organizations have helped millions of Americans access resources and services for creating wealth, assets, and healthy communities through business ownership. Earlier this year, President and CEO Connie Evans testified before the U.S. Senate Committee on Small Business and Entrepreneurship regarding the modernization and reauthorization of the SBA’s Access to Capital programs.
About Association for Enterprise Opportunity
The Association for Enterprise Opportunity is the leading voice of innovation for microfinance and microbusiness. Our mission is to create economic opportunity for underserved entrepreneurs throughout the United States. We engineer transformational change through research, convening, incubation, and advocacy to foster a robust and inclusive marketplace. For more information, please visit www.aeoworks.org.