Senate Democrats press SBA chief to testify as proposed FY2027 budget cuts threaten small-business programs

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SBA budget cuts testimony

Highlights

Senate Small Business Committee Democrats urge SBA Administrator Kelly Loeffler to testify amid a proposed 67% SBA funding cut for FY2027.
The administration's plan would eliminate 15 of 16 entrepreneurial development programs and impose a 94% cut to counseling and training services benefiting nearly 1 million small businesses annually.
Recent KPMG and SBA Inspector General audits found nearly two dozen non-compliance issues and deficient information security in nine of ten domains, intensifying congressional oversight demands.

Budget cuts and oversight demand

As detailed in a press release from the Senate Committee on Small Business and Entrepreneurship's Democratic members, Ranking Member Edward J. Markey and every Democratic member of the committee are urging SBA Administrator Kelly Loeffler to testify before lawmakers. They say Loeffler is the only Trump cabinet member who has not agreed to appear before Congress this year and note that she has not testified before the Senate Small Business Committee in more than a year.

The lawmakers link their demand to the administration's budget proposal, which calls for a 67% reduction in SBA funding for FY2027. They say the plan includes a 94% cut to counseling and training services and would eliminate 15 of the agency's 16 entrepreneurial development programs, including Small Business Development Centers, Women's Business Centers, and SCORE.

In their letter, the committee Democrats argue that the proposal would remove most of the resources now available to new and growing businesses. They say the affected programs serve nearly 1 million U.S. small businesses each year, including women- and minority-owned enterprises, and warn that the cuts would sharply limit support for prospective business owners.

Audit findings add pressure on agency

The lawmakers' appeal also follows recent compliance and cybersecurity findings at the SBA. An independent audit by KPMG cited nearly two dozen findings of non-compliance, while an SBA Inspector General report found the agency below the acceptable baseline for information security protocols in nine of the 10 domains measured.

Committee Democrats say congressional oversight is necessary to assess how the agency is operating and whether taxpayer funds are being used effectively, especially as the administration seeks to eliminate roughly two-thirds of the SBA. They argue the committee must be able to evaluate whether the agency is meeting the needs of America's 36 million small businesses.

Markey has been pressing the administration on the issue for months. In April, he called for the planned cuts to be rescinded, and the latest letter extends his broader criticism of the Trump administration's economic and governance policies.

Our earlier report on the Trump administration’s 2027 budget outlined the U.S. Treasury’s case that the plan extends a lower-tax, lower-regulation agenda tied to recent tax changes, manufacturing growth, and trade-deficit improvement. It also highlighted Treasury’s claims about higher refunds and broad use of new tax-cut provisions, while pointing to longer-term initiatives such as Trump Accounts as part of the same policy package.

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