Officers are warning a key federal program that gives catastrophe loans to companies and owners is operating critically low on funds within the aftermath of back-to-back hurricanes, rising the stress on Congress to return to Washington.
The Small Enterprise Administration (SBA) has roughly $50 million left for brand spanking new catastrophe loans, and the company says it expects funds to be depleted quickly, probably earlier than Congress returns from recess subsequent month, amid heightened demand within the aftermath of Hurricane Helene. Officers say this system wants about $1.6 billion.
“SBA staff is currently on the ground across the country working to support communities impacted by disasters,” SBA Administrator Isabel Casillas Guzman stated in an announcement this week. However, she added, the company is “quickly exhausting current federal funding to make new offers for affordable recovery loans to homeowners, renters, small businesses, and non-profits.”
“Americans should not have to wait for critical assistance when they need it the most.”
President Biden has additionally sounded the alarm on the matter, telling reporters Thursday that Congress “should be coming back and moving on emergency needs immediately.”
“Congress should move as rapidly as they can, particularly on the most immediate need, which is small business,” he stated.
The most recent name by Biden provides to the rising stress Congress has confronted to return from the marketing campaign path to approve further catastrophe aid in response to the harm wrought by hurricanes Helene and Milton.
Congress final month handed a brief stopgap measure to maintain federal funding from lapsing in October and to stop a authorities shutdown. The invoice didn’t embody further funding for the SBA, regardless of repeated requests from the administration.
Additionally notably lacking from the identical measure was additional funding for the Federal Emergency Administration Company (FEMA). As an alternative, negotiators stated the deal allowed for the company to make use of the fund’s fiscal 2025 assets quicker for catastrophe response throughout the practically three-month stopgap, permitting FEMA entry to attract from a roughly $20 billion pot beginning Oct. 1.
Whereas FEMA officers have stated in latest days that it has adequate assets to answer hurricanes Milton and Helene whereas Congress is out of session within the brief time period, additionally they indicated to reporters that just about half of that cash is already gone.
The SBA has stated it is going to proceed to course of catastrophe mortgage purposes after the funds are expended, however further funding from Congress will probably be wanted to make additional mortgage gives to debtors and ship out checks.
Lawmakers on either side of the aisle are pushing for Congress to chop its recess early forward of its present Nov. 12 return date, as campaigns kick it into their last gear forward of the vital fall elections.
In a letter to Home Speaker Mike Johnson (R-La.) earlier this week, a bunch of Home Democrats stated the catastrophe funding permitted by Congress not too long ago fell “critically short” of what is going to be wanted for the present fiscal 12 months.
“The Federal Emergency Management Agency (FEMA) must be equipped not only to respond to current disasters but also to adequately prepare for future events,” the letter learn.
The lawmakers additionally pressed for the SBA’s catastrophe aid mortgage program to “be replenished as soon as possible to help business owners rebuild their enterprises and communities.”
Johnson signaled after Helene that he had little curiosity in bringing lawmakers again to Washington, saying FEMA has sufficient funding to cowl the interval till Congress is again in session. The Hill has reached out to the Speaker’s workplace for remark.
Even some Republicans are pushing the Speaker on the problem.
“Just got off the phone with @POTUS Biden. He is personally overseeing that FEMA does not create problems with the debris removal and is supportive of the 15 Billion in FEMA funds ONLY FOR Hurricane victims,” Rep. Anna Paulina Luna (R-Fla.) wrote Thursday on social platform X.
“If Congress goes into a special session we can get it passed immediately. This needs to happen. @SpeakerJohnson call us back,” she stated Thursday earlier than including in a subsequent publish that she additionally talked to Johnson and that he “is actively also working this issue.”
Pressed on the decision by Biden for an early return, Senate Majority Chief Chuck Schumer’s (D-N.Y.) workplace additionally stated Friday that he’s “awaiting estimates from agencies working diligently on the ground.”
Regardless of earlier requests to bolster catastrophe assist funds, the Biden administration has not but launched a brand new emergency supplemental funding request within the aftermath of Helene and Milton.
Requested earlier this week about how a lot time Congress has earlier than the SBA or FEMA runs out of cash, Biden advised reporters that dialogue on the matter continues to be ongoing, however he stated that, “in terms of the SBA, it’s pretty right at the edge right now.”
“It’s going to take several billion dollars,” Biden stated, discussing total emergency wants. “It’s not going to be a matter of just a little bit. But we’re providing now to make sure people have the emergency relief they need.”
