SBA proposes deep cuts, including elimination of 2,700 positions and funding for several small‑business counseling programs
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Summary
At a House Small Business Committee hearing, Administrator Kelly Loeffler defended a Trump administration budget proposal that trims SBA headcount and would eliminate funding for multiple entrepreneurial development programs; Democrats and some Republican members pressed for details and documents.
Chairman Williams and ranking member Velasquez exchanged pointed opening remarks as the House Committee on Small Business held a hearing on the Small Business Administration’s fiscal 2026 budget and organizational changes. Administrator Kelly Loeffler told the panel the administration’s proposal returns the agency to a “mission” focus and is meant to “streamline services, eliminate waste, and ensure every taxpayer dollar delivers measurable results for America’s small businesses.”
The central policy item under scrutiny was a reduction in SBA staff and a proposal to remove funding for several entrepreneurial development programs. Ranking Member Velasquez said in her opening statement that the administrator had proposed eliminating 2,700 employees, “representing a 43% cut to agency staff,” and warned that the reductions could erase institutional knowledge and customer service capacity. Loeffler acknowledged the staffing change to the committee, saying the agency has “reduced the agency headcount by 2,700 employees, returning it to the same size that it was during the first Trump administration.”
Why it matters: committee members said the cuts directly affect services that small firms rely on, particularly counseling, veterans programs and women’s business centers. Multiple members pressed Loeffler for a list of offices and reorganization plans submitted to the Office of Personnel Management (OPM) on March 13 and April 14 and for monthly progress reports beginning in May. Loeffler committed to work with the committee on providing information but did not provide the requested OPM documents during the hearing.
Committee members and witnesses also disputed how far the cuts go. Representative Tran and others raised the budget’s proposed elimination of 15 entrepreneurial development grants, including women’s business centers and other local counseling programs; a member later put the total reduction for the 15 programs at roughly $167,000,000. Loeffler said the agency intends to refocus delivery through the SBA’s network of 1,000 small business development centers and the district offices, while also asserting the budget maintains support for veterans through SBDC partnerships and a separate $10,000,000 increase proposed for veteran‑focused services.
Members sought specifics on implementation and near‑term impacts. Velasquez asked how many employees left under deferred resignations and where field operations had seen cuts; Loeffler answered that the headcount was reduced by 2,700 and said there were 35 offices with “0 or 1 employee” when her team reviewed the footprint. Ranking members asked for granular numbers and copies of the reorganization plans; Loeffler agreed to work with the committee and supply additional information.
What stayed unresolved: members requested—and repeatedly pressed for—documentary evidence (RIF and OPM submissions, monthly progress reports) and a jurisdictional breakdown showing which local offices would be changed or closed. Loeffler said the agency would provide more detailed numbers and promised cooperation on oversight requests but did not produce the full documents during the hearing.
Looking ahead: several members signaled plans for follow‑up oversight, and the committee asked for prompt production of the reorganization plans and monthly reports. The issues—staffing levels, service continuity for local counseling networks, and the future of women’s business centers and veterans outreach programs—are likely to recur in additional hearings and in written oversight requests.
