Today Operation HOPE and I joined together with the House chairman of the Committee on Small Business and the U.S. Small Business Administrator Hector Barreto to provide some support for the agency in these trying times. The agency is dealing with some very real challenges around its response to Hurricane Katrina.
What I said, in short, was that this is not a disaster, it is a catastrophe, never before witnessed in the United States of America. That said, no one agency can "respond" adequately to Katrina. It will take everyone, and all hands on decks. Federal hands, included. It is ridiculous to think that any one agency – and certainly not one with a total of 4,900 federal employees and a modest budget in comparison to other first line federal agencies – can deal with 2.9 million victims of Katrina, divided by 4,900 full-time employees, even with a little over 4,000 temporary employees focused on processing. Respectfully, this makes absolutely no sense.
What we need again is "all hands on deck," and a much more robust involvement of and coordination with all federal government agencies with a hand in Katrina relief. If someone wants to criticize the SBA, that’s fine but let’s do it where criticism has relevance. This is not their normal activity, and this is no normal disaster. The SBA is simply out gunned here, and frankly, there also needs to be some legislative changes made as well. In just one example of this, federal law requires that a victim of Katrina must first be "turned down" for a loan by the SBA, before they can access the full grant funds available at and through FEMA. This could mean that folks who never wanted an SBA loan in the first place, and who would never be qualified for one in the second place, end up in last place — waiting 2 months to get the "no" that a good number of them could in fact get today. Let’s do at least these folks a favor, at Christmas time, and simply tell them "no," and allow them to move on with their lives. They have been through enough.
Finally, this is a common sense (proposed) legislative change that happens to make good business sense as well, for not only should someone with a 530 or lower FICO (credit) score not qualify for SBA financing, as a banker I can say they probably "shouldn’t." What they need is a grant, not a loan.
We are all just asking for trouble in the future, and additional stress for folks who never asked for a visit from someone named Katrina in the first place. During this holiday season, let’s all stay prayerful for all the victims of Katrina, and their families.
Onward, with HOPE