In February, the President released his FY 2017 Budget Proposal, the
final budget proposal of his administration. The President’s annual budget is
often referred to as an economic blueprint as it outlines the Administration’s
spending priorities. Importantly, last year’s Bipartisan
Budget Act, already set the top-line spending levels for FY2016 and FY2017.
The President’s budget follows the top-line discretionary spending limit, and
distributes $4.1 trillion in total across the Administration’s priorities. The
Budget proposal has no effect on law, but instead begins the budget season.
The President’s Budget Request is supplemented by each Agency’s
budget justifications. The chart below highlights programs important to AEO
members:
Program
|
FY2017- Request
|
Treasury CDFI Fund
|
$246 million
|
Treasury CDFI BGP
|
$1 billion
|
Microloan Program Lending
|
$44 million
|
Microloan Program
Technical Assistance
|
$31 million
|
PRIME
|
$0
|
Women’s Business Centers
|
$16.7 million
|
Veteran's Outreach
|
$12.3 million
|
Rural Business
Development Grants
|
$ 30 million
|
The Small
Business Administration’s (SBA’s) request for the Microloan program is a
win for AEO members. SBA increased their request for the Microloan program
lending authority to $44 million – up over 25% from last year’s request of $35
million
Like last year, the SBA did not make a budget request for
the PRIME program, which provides training and technical assistance to
disadvantaged entrepreneurs and microenterprise development organizations.
Despite the SBA not making a request, AEO’s advocacy efforts were successful in
restoring funding for PRIME to $5 million. AEO will be sure to work with
Congress to ensure that appropriators know the value of the PRIME
program.
Looking Past the
Numbers
While the budget lays out funding levels, it also allows
agencies to highlight their legislative priorities. SBA aligned its FY2017 priorities
with issues AEO members will be familiar with.
Specifically, SBA requested that Congress eliminate the 25/75
technical assistance rule in the Microloan program. The SBA cited
intermediaries’ need to provide “unconstrained" pre- and post-loan
technical assistance. Also, the SBA called for changes to the 1/55 rule. SBA
pointed out that, “this restriction effectively delays deployment of microloan
funds thereby limiting the availability of capital for small businesses
regardless of the size of the state or the needs of the small business
community.”
Moving Forward
The President’s submission of a budget to Congress formally
kicks off the annual spending process. Since Congress has already agreed upon
the top-level of $1.1 trillion in discretionary spending for FY2017, the debate
will be about the level of funding for agencies, and certain programs. While it
is unclear if there is enough time in the calendar to complete a comprehensive
budget process with 12 separate appropriation bills, AEO’s policy team is
committed to advocating for our priorities every step of the way. Members can
look forward to updates through out the spring and summer on our efforts.
