To ensure that SBA truly functions as the champion of America's entrepreneurs, President Clinton challenged SBA to meet the following policy goals:
|FY 1993 (Actual)||FY 1996 (Budgeted)|
|$1.10 billion||5,599||$814 million||4,284|
Doing More With Less. To meet our reinvention goals, the agency needed to accomplish more, with fewer people and with a lower budget. We made a conscious effort to shift resources to the field, where our small business customers operate. We reduced the number of employees in the Washington headquarters by 29 percent and dramatically reduced the staffing in our regional offices. Between fiscal years (FYs) 1992 and 1996, we eliminated 862 full-time positions -- an agencywide personnel reduction of over 23 percent -- saving more than $250 million in salaries and expenses and exceeding all of our NPR staffing targets.
While our personnel levels declined, our loan portfolio expanded. The total volume of SBA-guaranteed loans grew from 24,000 to 56,000 between FYs 1992 and 1995. Support for small business increased for every category of borrower: the number of loans made to minority owned businesses over this period tripled, from 3,680 to 10,380; and the number of women-owned businesses receiving SBA-guaranteed loans quadrupled, from 3,376 to 13,398. As lending has increased, SBA's commercial loss rate has decreased; for FY 1995, it stood at only 1.3 percent, which compares favorably with that of the most conservative lending institutions.
In addition to enlarging our loan portfolio, we also overhauled our Small Business Investment Company program, the country's largest source of venture capital for small businesses. As a result, we have raised more private capital for investment in the last two years than during the previous 15 years combined.
Public-Private Partnerships. Despite restructuring and streamlining, we expanded SBA's current programs to serve more businesses. We were able to do this by working closely with our resource partners -- private lenders, nonprofits, educational institutions, state and local governments, corporations, and others. For example, SBA is no longer in the business of direct lending for its largest loan programs. Instead, we work directly with over 7,000 private lenders which provide tens of thousands of small business loans each year.
In addition, SBA partners with the 956 Small Business Development Centers across the country and the 13,000 Service Corps of Retired Executives volunteers to ensure that small businesses have the training and counseling they need to succeed. Over the past three years, we have also worked with state and local governments as well as corporate sponsors to add 35 new Business Information Centers and four new One-Stop Capital Shops, which centralize all the resources a small business would need, from business planning to our full range of loan programs.
Regulatory Reform and Paperwork Reduction. In January 1996, SBA completed a streamlining of all its regulations. The agency converted all of the new rules to plain language, eliminating more than 50 percent of its pages in the Code of Federal Regulations. The regulations that remain are clearer, more understandable, and easier to use.
In 1993, SBA implemented its LowDoc business loan application. This one-page form for loans under $100,000 eliminated a cumbersome predecessor, making the SBA loan process easier and more user-friendly. Most of our brochures have been redesigned and rewritten to appeal to a wider audience. By year's end, our entire 25,000 pages of internal standard operating procedures will also have been streamlined and rewritten in plain English. Thanks to SBA's reinvention work, small businesses now have better information, fewer regulations, and less paperwork.
SBA also has worked to encourage regulatory reform and paperwork reduction at other federal agencies. We have worked closely with the Environmental Protection Agency, the Occupational Safety and Health Administration, the Internal Revenue Service, and others to ease the regulatory burdens they impose on small business owners. We helped pioneer the concept of an electronic regulatory information center (now a key part of the U.S. Business Advisor). We have listened carefully to the needs of our small business customers and have worked hard to meet those needs.
Streamlined Operations and Administration. SBA could not fully reinvent itself without a careful evaluation of its internal operations. Today's SBA is more efficient than ever before. The 10 regional office staffs have each been reduced from an average of 50 full-time employees to three. We closed or converted all 11 of our Post of Duty offices. We are centralizing all of our loan processing into two locations in Little Rock and Fresno and created a centralized preferred lender processing center in Sacramento, CA. (Our most experienced lenders are licensed to participate in the Preferred Lender Program and can approve loans without prior approval from SBA loan officers, saving paperwork and time.) Furthermore, we were recently authorized to pilot the centralized processing of LowDoc loans. This streamlining and centralization has allowed us to reduce our staff while increasing our effectiveness.
Small Business Goes Online. In our effort to reinvent the SBA, we examined every available tool to increase our efficiency, effectiveness, and outreach. As part of this effort, we harnessed the latest technology to put SBA on the Internet and World Wide Web. Getting information is easier and more cost effective than ever for small business owners with our new SBA Online home page. Users can access information instantly on all of SBA's programs. They can even download loan applications to their own computer. Recently, our home page logged over 500,000 hits a week. The U.S. Business Advisor, another online feature, provides instant access to all SBA regulations and over 60 other government agencies. Through the Internet, SBA is more accessible to more of America's small businesses.
Meeting the Challenge. SBA is proud of its achievements. We have streamlined our agency and our regulations while providing record levels of capital to small businesses. We have centralized our resources while creating new programs that extended the reach of these resources. We are smaller and more effective than ever before. In 1994, we accepted a challenge to reinvent SBA. While some may have doubted that we could succeed, by 1996 it is clear that we have more than met our goals we have surpassed them.