Petaluma, Ca-President Obamaand Congress have slashed the budget for the Small Business Administration (SBA)more than any other federal agency. Over the last two years the SBA's budgethas been cut by over 25%. In 2011/2012 the SBA operating budget was $985million. For fiscal year 2015 the SBA's annual operating budget plummeted to $710million. While every other agency has seen net increases of up to 10% orminiscule budget cuts of 1% to 2% the SBA is the only agency in the federalgovernment to see its budget cut by over 25%. The annual operating budget forthe SBA was higher 30 years ago when Ronald Reagan was President than it istoday. The Department of Commerce has seen its budget increased by as much as10%, the Department of Interior as much as 5%, the Department of Agriculture asmuch as 3% and the Department of Energy by 2.5%. The Department of Labor,Education, and Department of Homeland Security have seen their budgets cut by1% to 3%. (link tograph)

The Obama Administration's decisionto slash the SBA's budget comes on the heels of a flurry of storiesin the pressthat expressed concern that President Obama intended to implement RonaldReagan's plan to permanentlyclose the SBA by combiningit with the Department of Commerce.

The Obama Administration has beenembarrassed by a series of federal investigations and media reports thatuncovered wide spread fraudand abuse in virtually every program administered by the

SBA.

After investigating the SBA, the GovernmentAccountability Office (GAO) released report 10-108that stated, "By failing to hold firms accountable, SBA and contractingagencies have sent a message to the contracting community that there is nopunishment or consequences for committing fraud."

NBC and CBS have both reported therampant diversion of billions of dollars in federal small business contracts tomany of the largest Fortune 500 firms in the country. Some of the firms theyuncovered were receiving federal small business contracts included, Oracle,IBM, Hewlett-Packard, Microsoft, Rolls Royce and Walmart.

Every year of the ObamaAdministration, SBA Inspector General, Peg Gustafson, has reported thediversion of federal small business contracts to large businesses to be the number one problem at theagency.

A recent legal opinion byProfessor Charles Tiefer, one of the nation's leading experts on federalcontracting law, found small businesses may have been cheated out of as much asone trillion dollars in federal contracts due to the rampant fraud in federalsmall business contracting programs.

The dramatic cuts to the SBA'sannual operating budget will no doubt make investigating and policing therampant fraud that has been uncovered much more difficult.

For any questions regarding theSmall Business Administration, please contact their spokesman:

Terry Sutherland

(202)205-6919