Senator Young, colleagues demand answers from SBA over mishandling of disaster resources

Monday, October 21, 2024 at 8:00 PM

After the Small Business Administration (SBA) claimed it ran out of funds for disaster relief, U.S. Senators Todd Young (R-Ind.), Joni Ernst (R-Iowa), Tim Scott (R-S.C.), and James Risch (R-Idaho), members of the Senate Small Business and Entrepreneurship Committee, demanded answers over the agency’s mismanagement of disaster resources.

In the letter, the senators highlighted that the SBA failed to notify Congress of the need for supplemental funding ahead of time, as required by law. They also stressed how bureaucratic inefficiency was to blame for the SBA coming up short for Americans in need.

“Under existing law, the SBA already has several reporting requirements to provide Congress with sufficient notification and information before any shortfall occurs in its disaster account. Unfortunately, the SBA failed to comply, or only partially complied, with several of these provisions and is now, at the eleventh-hour, sounding alarm bells. We must consider whether SBA’s internal decisions were the catalyst for this unfortunate situation. For example, SBA currently has more than $550 million in its disaster administrative expenses account to pay for salaries, but did not request any reprogramming to their disaster loan fund,” the senators wrote.

“Further, during a disaster, on-the-ground staff and training is essential. Congress has long recognized the need for agencies to scale up and down during times of disaster. In light of this, the SBA has a statutorily authorized disaster cadre, which is not meant to fall below 1,000 employees,” the senators continued.

“Based on information recently provided by the SBA in response to questions as it sought supplemental funds, it appears that this cadre may have vanished, but no one was notified. This raises stark concerns about the SBA’s ability to provide for disaster victims during the immediate aftermath of these storms and its ability to inform Congress in accordance with the law,” the senators concluded.

Click here to view the full letter.