Senator Ernst Questions SBA's Handling of Disaster Funds

Senator Joni Ernst from Iowa recently expressed worries about the Small Business Administration's (SBA) transparency in dealing with disaster relief funds. This concern arose after President Joe Biden revealed that the SBA's loan program for disaster relief had run out of money following Hurricanes Helene and Milton. While those affected can still apply for loans, they won't be available until Congress approves new funding next month. Ernst is troubled by the SBA's lack of clarity about its financial situation, which led to the funds running out at a crucial time. She believes the agency didn't follow the rules to disclose financial shortfalls in advance. Ernst also thinks there might be political reasons behind this failure.

In a letter co-signed by other senators, Ernst mentioned that the SBA didn't provide the necessary information to Congress about its financial needs until days after news stories broke. She also pointed out that the SBA changed its disaster loan program terms in 2023 and 2024, increasing the subsidy rate without properly notifying or modeling the consequences. The SBA helps people affected by natural disasters, including renters, homeowners, and businesses. However, with the current situation, only those with existing loans will continue to receive payments. New loans can't be issued until Congress returns in November, after the election. The Southeast faced two deadly hurricanes in quick succession, straining the U.S.'s disaster response capabilities. These hurricanes led to hundreds of deaths, making 2024 one of the deadliest hurricane seasons.

Actions