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Committee questions SBA on disaster loan staffing cuts and fund depletion risk
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Summary
Committee members pressed the SBA's Office of Capital Access about elimination of disaster processing staff and an agency report projecting a disaster loan account depletion date of Oct. 11; the SBA official said the agency had "rightsized" operations and expressed confidence in disaster response capacity while offering to follow up with offices.
Several representatives raised alarms about staffing reductions at the SBA disaster processing center and a committee‑cited report showing a disaster loan account balance and a projected depletion date.
Representative McGarvey and others told the committee that the Office of Capital Access shed 196 positions between February and June and asked whether those roles were transferred to other SBA disaster offices or eliminated. McGarvey quoted a July 2025 SBA disaster loan report that the committee had reviewed, which listed a disaster loan account balance of $2,750,000,000 and an anticipated depletion date of Oct. 11.
Thomas Kimsey said the agency "rightsized" the workforce to pre‑COVID levels, described the move as a streamlining effort and said the SBA remains confident in its ability to deliver disaster loans. "We're confident in our disaster loan program," Kimsey said, and added that the agency has experience deploying billions for recent wildfires and other catastrophes.
Why it matters: Disaster loans are a principal federal tool for small businesses to recover after storms, floods and wildfires. Members said cuts to processing staff during a period with rising natural disasters could slow disbursements and leave communities waiting for capital.
Kimsey told members he would work with members' offices and provide additional information. Members asked for data showing where positions moved, how the SBA plans to staff regional processing centers, and contingency plans if appropriated funds lapse.
Ending: The SBA committed to follow up with members' offices on staffing changes and to provide additional documentation about the disaster loan account and contingency plans for continued disaster response.
