[Senate Hearing 119-18]
[From the U.S. Government Publishing Office]


                                                         S. Hrg. 119-18

                      NOMINATION OF THE HONORABLE
                   KELLY LOEFFLER TO BE ADMINISTRATOR
                   OF THE SMALL BUSINESS ASSOCIATION

=======================================================================

                                HEARING

                               BEFORE THE

                      COMMITTEE ON SMALL BUSINESS
                          AND ENTREPRENEURSHIP

                                 OF THE

                          UNITED STATES SENATE

                    ONE HUNDRED NINETEENTH CONGRESS

                             FIRST SESSION

                               __________

                            JANUARY 29, 2025

                               __________

      Printed for the use of the Committee on Small Business and 
                            Entrepreneurship
                            
[GRAPHIC NOT AVAILABLE IN TIFF FORMAT]                            


        Available via the World Wide Web: http://www.govinfo.gov
        
                               __________

                   U.S. GOVERNMENT PUBLISHING OFFICE                    
59-472                  WASHINGTON : 2025                  
          
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           COMMITTEE ON SMALL BUSINESS AND ENTREPRENEURSHIP
                    ONE HUNDRED NINETEENTH CONGRESS

                              ----------                              
                        JONI ERNST, Iowa, Chair
            EDWARD J. MARKEY, Massachusetts, Ranking Member
JAMES E. RISCH, Idaho                MARIA CANTWELL, Washington
RAND PAUL, Kentucky                  JEANNE SHAHEEN, New Hampshire
TIM SCOTT, South Carolina            CORY A. BOOKER, New Jersey
TODD YOUNG, Indiana                  CHRISTOPHER A. COONS, Delaware
JOSH HAWLEY, Missouri                MAZIE K. HIRONO, Hawaii
TED BUDD, North Carolina             JACKY ROSEN, Nevada
JOHN R. CURTIS, Utah                 JOHN W. HICKENLOOPER, Colorado
JAMES C. JUSTICE, West Virginia      ADAM B. SCHIFF, California
JON HUSTED, Ohio
                Meredith West, Republican Staff Director
                 Sean moore, Democratic Staff Director
                            
                            C O N T E N T S

                              ----------                              

                                WITNESS

                                                                   Page
The Honorable Kelly Loeffler of Georgia..........................    14
    Prepared statement...........................................    17

                            COMMITTEE INSERT

Ernst, Senator Joni
    Letter dated January 21, 2025................................     4

              ADDITIONAL LETTERS/STATEMENTS FOR THE RECORD

Angel Capital Association
    Letter dated January 29, 2025................................    20
Association of Women's Business Centers
    Letter.......................................................    21
Economic and Community Development Institute
    Letter dated December 5, 2024................................    22
Ernst, Senator Joni
    Minority Report dated November 14, 2023......................    23
Georgia Public Policy Corporation
    Letter dated January 22, 2025................................    42
Independent Community Bankers of America
    Letter dated January 14, 2025................................    43
Independent Women's Voice
    Letter dated January 15, 2025................................    44
International Franchise Association
    Letter dated January 21, 2025................................    45
Job Creators Network
    Letter dated January 18, 2025................................    46
Kemp, Governor Brian P., State of Georgia
    Letter dated January 29, 2025................................    48
National Asian Pacific Islander American Chamber of Commerce and 
  Entrepreneurship
    Letter dated February 3, 2025................................    49
National Association of Development Companies
    Letter dated January 17, 2025................................    50
National Association of Development Companies
    Letter dated January 21, 2025................................    51
National Association of Government Guaranteed Lenders
    Letter dated January 20, 2025................................    52
National Restaurant Association
    Letter dated January 24, 2025................................    53
National Retail Federation
    Letter dated January 17, 2025................................    55
National Small Business Association
    Letter dated January 28, 2025................................    56
Small Business and Entrepreneurship Council
    Letter dated January 18, 2025................................    57
Small Business Development Centers
    Letter dated January 13, 2025................................    59
Small Business Investor Alliance
    Letter dated January 17, 2025................................    60
Society for Human Resource Management
    Letter dated February 5, 2025................................    62
U.S. Black Chambers, Inc.
    Letter dated December 9, 2024................................    64

                        QUESTIONS FOR THE RECORD

The Honorable Kelly Loeffler of Georgia
    Responses to questions submitted by Chair Ernst, Ranking 
      Member Markey, and Senators Risch, Young, Cantwell, 
      Shaheen, Booker, Hirono, Rosen and Hickenlooper............    91

 
                           NOMINATION HEARING

                              ----------                              


                      WEDNESDAY, JANUARY 29, 2025

                      United States Senate,
                        Committee on Small Business
                                      and Entrepreneurship,
                                                    Washington, DC.
    The Committee met, pursuant to notice, at 3:33 p.m., in 
Room 428A, Russell Senate Office Building, Hon. Joni Ernst, 
Chair of the Committee, presiding.
    Present: Senators Ernst [presiding], Risch, Scott, Young, 
Hawley, Budd, Curtis, Justice, Husted, Markey, Cantwell, 
Shaheen, Coons, Hirono, Rosen, Hickenlooper, and Schiff.

               OPENING STATEMENT OF SENATOR ERNST

    The Chair. I call the Committee on Small Business and 
Entrepreneurship to order. I want to welcome everyone to the 
first hearing of the committee in this Congress. I am excited 
to assume the role of chair and serve as the voice for our 
small businesses.
    The purpose of today's hearing is to consider President 
Trump's nominee to lead the Small Business Administration, 
former Senator Kelly Loeffler. I'd like to welcome you here 
today and thank you for your willingness to serve.
    Senator Loeffler. Thank you very much, Senator.
    The Chair. I'm also delighted to welcome the committee's 
new Ranking Member, Senator Markey. He has been an esteemed 
member of the committee for nearly 12 years. We both recognize 
the importance of our nation's small businesses, innovation and 
promoting national security, particularly through the SBIR/STTR 
Program. And I'm excited to continue the bipartisan working 
relationship of our committee.
    I would also like to welcome back our returning members and 
provide a warm welcome to all of our new members to the 
Committee, Senators Curtis, Justice, Husted, and Schiff. I am 
looking forward to working with everyone, and I expect a very 
productive term, where we focus on the most pressing issues 
facing small businesses, including tax and regulatory relief to 
ensure entrepreneurs thrive.
    Just to give a quick run of show, I'm going to make a brief 
opening statement, then I'll turn to the Ranking Member Markey 
to do the same. Following that, we have Senator Scott and 
Senator Britt who will introduce our nominee. Then, we'll 
administer the oath, which is required. After the oath, Senator 
Loeffler will be recognized for an opening statement, followed 
by questions from our members, alternating between each side. I 
now recognize myself for five minutes for purposes of an 
opening statement.
    Senator Loeffler, as I already said, welcome to the 
committee and thank you for your willingness to serve in this 
role. I greatly appreciate the time you've spent meeting with 
me and my colleagues prior to this hearing.
    I want to take a minute to recognize some of your family 
here supporting you today. First, your husband Jeff. Thank you, 
Jeff, for being here. Next, your brother Brian and his family, 
who I understand traveled to Washington, DC from their farm in 
Illinois. And also, your parents, Don, and Lynda, who are 
watching the hearing from their home in Florida today. We 
appreciate you all making the trip here and tuning in to this 
important hearing.
    As a former member of this body, you understand the 
importance of the Senate's advice and consent process, and I 
appreciate that you have fully embraced the committee's 
standard, yet extensive, vetting of your experience and 
background in advance of today's hearing and our upcoming vote 
on your confirmation.
    As a successful businesswoman, it is abundantly clear that 
you truly understand what it takes to be an entrepreneur. 
Throughout your distinguished career, you've risen through the 
ranks of multiple companies due to your determination and grit, 
and you've started many successful businesses yourself.
    Most importantly, you understand what it means to be 
overrun by Washington's bureaucratic overreach, and the 
government must instead get out of business's way so they 
thrive. Small businesses and their advocates are excited for 
your leadership.
    The Committee has received several letters of support for 
Senator Loeffler's nomination. The mission of the SBA is to aid 
small businesses to ensure economic prosperity and free 
competition. Traditionally, SBA administrators' programs and 
services fall into three main buckets: there's counseling, 
contracting and access to capital.
    While SBA once may have been characterized as a smaller 
agency, Covid small business programs made SBA a household 
name, as the agency received a whopping $1.1 trillion in 
taxpayer funding to assist small businesses during the 
pandemic. With that funding came big responsibilities and our 
main concern, the SBA under the prior administration failed to 
live up to its mission. I believe substantial reforms must be 
made to get the SBA back in shape, and that is going to require 
strong leadership.
    The Biden Administration decided to turn a blind eye to 
Covid fraud and delinquencies refusing to properly collect 
outstanding debt and fraudulent funds, which has huge 
implications to the taxpayer. Reports have indicated SBA 
charged off about $18.6 billion worth of EIDL loans in fiscal 
year 2024. Not once during the Biden Administration was the SBA 
able to provide an accounting of their loans receivable and 
loans guarantees, which meant that the Government 
Accountability Office hasn't been able to even issue a 
financial audit of the agency since fiscal year 2020.
    SBA also completely mismanaged and misinformed Congress 
last year regarding its disaster loan account, resulting in a 
shortfall lasting 66 days. An unacceptable failure for the 
disaster victims in North Carolina, South Carolina, Georgia, 
Virginia, and Florida. I do appreciate that once the account 
was funded, SBA staff worked around the clock, including over 
the holidays to get the money out to disaster victims. But I 
never want to see that situation unfold again.
    While SBA is failing, it also appears that its workforce 
continues to stay at home, while it's more than 246,000 square 
foot, Washington, DC headquarters sits empty. The GAO found 
that even if everyone did show up to work in person, the SBA's 
building space would still only be 67 percent utilized, which 
is a complete waste of taxpayer money. That is why I introduced 
a bill to relocate 30 percent of the headquarters workforce to 
the SBA district offices across the country and cut 30 percent 
of office space.
    The SBA has been completely out of touch with the real-
world challenges of entrepreneurs, and while the Biden 
Administration simultaneously let SBA employees stay home, they 
also added positions in Washington, DC, while stripping offices 
in Iowa, New Hampshire, Utah, and other states. I would like to 
work with you, Senator Loeffler, on ways to ensure SBA is 
effectively utilizing its personnel and ensuring that small 
businesses in all parts of America are able to access SBA 
programs if they need them.
    I've detailed these concerns and others regarding the mess 
you have to clean up from the Biden Administration, and 
potential landmines you will encounter in a letter to President 
Trump on day one of his new administration. I ask unanimous 
consent to enter this letter into the record. Without 
objection, so ordered.
    [The information referred to follows:]
    [GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]
    
    The Chair. In Iowa, Main Street is in trouble, and I hear 
from my colleagues that this is true in their states across 
America. Small businesses are the lifeblood of our rural 
communities and for too long under the Biden Administration, 
they've been crushed with red tape and woke program 
requirements, with no one caring about how that affects the 
day-to-day operations.
    I see a great opportunity for the Trump administration and 
you Kelly, to revitalize small businesses in America. Thank you 
again for being here and I look forward to your testimony. I 
now recognize Ranking Member Markey for his opening statement.

                  STATEMENT OF SENATOR MARKEY

    Senator Markey. Thank you, Madam Chair, and congratulations 
to you. And welcome, to everyone here. I'd like to take a 
moment to welcome the newest members of the committee, on the 
majority it's Senator Curtis and Justice and Husted. 
Congratulations. And on the minority is Senator Schiff from 
California. I look forward to working with all of you.
    Senator Schiff, I extend my sympathies to you and the 
people of California. It's devastating to see the horrific 
damage caused by recent fires in your state. We stand with you 
in these challenging times.
    But unfortunately, climate disasters like those in 
California and that damage that was caused by just Hurricane 
Milton and Hurricane Helene, in a three-week period, in 
September and October of last year, it caused--those three 
storms cost 500 billion dollars' worth of damage, much to small 
businesses. That's more than half of the defense budget of the 
United States. That's the damage caused by three storms in a 
very brief period of time and not counting all the other 
damages they have caused.
    And it's only going to get worse, and more expensive unless 
we invest in long-term solutions to keep communities safe. We 
need to provide resources for small businesses in places such 
as California and the southeastern states to recover, to adapt 
and to innovate. And I was looking forward to this hearing to 
discuss work together on behalf of America's 34 million small 
businesses, including more than 722,000 small businesses in 
Massachusetts. We have 7 million people in Massachusetts and 
722,000 small businesses. That's our state's identity, it is 
small businesses.
    However, we find ourselves in a new reality, where the 
programs across government can be cut in a moment's notice with 
a cryptic two-page memo, leaving lawmakers and American 
families alike scrambling, to figure out whether the government 
is open for business. Can a new business owner looking to open 
her beauty salon, expects to close on an SBA loan and get her 
money on schedule?
    Yesterday we heard conflicting answers out of the White 
House, and I can only imagine what that uncertainty does to a 
first-time small business trying to meet its expenses, 
unacceptable. We can't allow a plumber or a childcare provider 
in everytown America, someone that may have spent their entire 
life working for someone else and is ready to invest in 
themselves, to question whether their government will keep its 
word and stand behind them.
    Apparently, we also live in a new reality where more than a 
dozen Inspector Generals, can be fired without notice or cause, 
in clear violation of the law that required a 30 days' notice. 
Mike Ware, the Inspector General at SBA, was illegally fired by 
President Trump on Friday night while he was at dinner with his 
wife. Inspector General Ware has earned bipartisan respect for 
his candor, for his meticulousness, and his tireless work ethic 
over 34 years of service. And because of his work, he was 
elected to actually chair the governmentwide council of 
Inspectors General.
    Having independent oversight at SBA is more important than 
ever given the breadth of its work. And I might add here, that 
under Mike Ware's leadership as SBA's Inspector General, he 
collected $9 billion in Covid-related fraud. Mike Ware did that 
job, and he is the chair of all Inspectors General, for the 
record, and got fired on Friday night, illegally with no 
notice, just wrong.
    Our job on this committee is to support small businesses 
and create a ruthless Darwinian marketplace that would bring a 
smile to Adam Smith. Massachusetts is one of the wealthiest 
states in America per person. So, we believe in capitalism, but 
we also believe in fairness. I want to ensure that every 
enterprising kid with a million-dollar idea has the chance to 
fairly to compete in the marketplace.
    We can promote innovation and competition by strengthening 
programs like SBIR, or the Small Business Innovation Research 
program and STTR, the Small Business Technology Transfer 
Program, which help bring many innovative ideas to life.
    In Massachusetts, small businesses have won more than $8 
billion in SBIR awards and over $722 million in STTR awards. As 
Ranking Member, I want to work together with Chair Ernst to 
strengthen SBIR and STTR, keep businesses in Massachusetts and 
Iowa or across our country, keep them competitive and build on 
the small business boom that was created under the Biden Harris 
Administration.
    Under President Biden's leadership, we saw a record 21 
million new business applications, support for more than $1.2 
trillion in loans and grants, to more than 13 million small 
businesses, 13 million small businesses, and a record amount of 
federal contracting dollars for small businesses, including 
small disadvantaged businesses. We need to keep that momentum 
up, and I just am looking forward to these next couple of 
years.
    Senator Loeffler, thank you for joining us today and I know 
we share a belief that access to capital in underserved areas 
is vital and I look forward to hearing your vision for 
America's small businesses. In particular, I'm eager to hear 
how you plan to promote competition, innovation, and job 
creation. It's an absolute critical part of our economy and as 
we know, a vision without funding is an hallucination, so we 
just have to make sure that we keep these programs intact, 
protected and flowing for everyone. So, I thank you, Madam 
Chair. I look forward to this hearing.
    The Chair. Thank you, Ranking Member Markey. And next, I 
would like to recognize Senator Britt from the great State of 
Alabama to introduce our nominee. Senator Britt, you're 
recognized.

                   STATEMENT OF SENATOR BRITT

    Senator Britt. Thank you, Chair Ernst, and Ranking Member 
Markey, and members of the committee. It is an honor to be here 
with you today to introduce my friend. She's President Trump's 
nominee to be Administrator of the Small Business 
Administration, former United States Senator Kelly Loeffler. A 
prolific job creator, an entrepreneur, and a quintessential 
American success story.
    Kelly grew up on a family farm, became the first in her 
family to earn a college degree and worked her way up to the 
highest levels of business. She joined Intercontinental 
Exchange when it had under 100 employees, and then spent nearly 
20 years building it into a global powerhouse and a Fortune 500 
company.
    She went on to found Bakkt, and as its CEO and first 
employee, she laid the foundation to take the company public in 
just three years. Since leaving the Senate in 2001, she's 
devoted her time to running a voter registration nonprofit.
    To me, the most striking and most impressive part of 
Kelly's story is this; she gave up a successful career in the 
private sector to serve the Senate, and donated every single 
paycheck while she was here to charity. And now, that she's 
made the decision to serve the American people once again, when 
confirmed, if confirmed, which I believe you will be and 
strongly, hopefully in a bipartisan fashion. With her signature 
selflessness, she will once again donate her salary to charity.
    Kelly is the perfect choice to lead the SBA, and I want you 
to understand why this matters to me. First off, 99.4 percent 
of the businesses in the great State of Alabama are small. So, 
what you do matters. And I'm also the daughter of two small 
business owners, and so I have seen the struggles of my parents 
firsthand.
    You've seen that when people get in these rooms in DC and 
create big, burdensome regulation, the truth is they hit the 
little guy the hardest. And you get it, you've lived it and 
you're ready to fight for these individuals. You're ready to 
fight for the American dream, you have a proven track record in 
delivering efficiency, accountability, and results driven 
leadership. And she wants to empower every entrepreneur with 
the resources and support they need to pursue what they believe 
they can.
    In closing, I'd like to say I have absolute confidence in 
Kelly's ability to strengthen our main streets, to figure out 
how we get capital to underserved communities, to figure out 
how we roll back red tape and let people do what they do best, 
job creators soar and achieve the American dream. Helping our 
small businesses thrive like never before is what I'm confident 
she will do.
    So, thank you so much for the opportunity to speak to each 
and every one of you, and thank you for giving her the utmost 
credence because she's who we need in this role as the next SBA 
administrator. Thank you.
    The Chair. Thank you, Senator Britt. And next, we will have 
Senator Tim Scott here at the dais to introduce the Honorable 
Kelly Loeffler. And Senator Scott, you are recognized.

                   STATEMENT OF SENATOR SCOTT

    Senator Scott. Thank you, Chairwoman Ernst, Ranking member 
Markey and members of the committee. And it's my honor to be 
here today to introduce President Trump's nominee to serve as 
Administrator of the Small Business Administration, my friend 
Kelly Loeffler from the great State of Georgia. I agreed to 
introduce Kelly today because her path like mine, to success 
and the U.S. Senate defied all odds. She's standing before you 
because she loves the Lord, she has an amazing work ethic, and 
frankly, she loves her country as much as anyone I've ever met.
    Small business in rural America run through the thread of 
the Loeffler family. I love the story of her family. She's a 
fourth-generation farmer. Her grandfather had an eighth-grade 
education, her father a high school education. She worked so 
hard, that literally her hard work and her strong value system 
made her the first college graduate and then later she earned 
her MBA. Her story is frankly a story of remarkable success and 
one that we should all be thankful that America continues to 
create all across the country.
    And one of the things that we oftentimes think of when we 
think about success and the American dream is home ownership. 
For me, the American Dream was achieved through small business, 
of having someone to be the Administrator of the SBA who 
understands and appreciates small business, I have a great 
passion for people like that.
    Someone who's not only--you are at the top of the food 
chain in business, but frankly, I prefer the part of your story 
that starts with a woman working her way at minimum wage jobs 
and working your way up that ladder, that we spend so much time 
talking about the top of the ladder, that we forget that most 
of us have to climb that ladder rung by rung by rung. And 
you've done a marvelous job of doing that.
    One of the things I'd like to celebrate about her time in 
the United States Senate after being appointed in Georgia was 
that, during the pandemic we worked closely on relief for 
families and businesses across the South. We fought to improve 
access to the CARES funds to keep Main Street alive.
    You and I fought together to stop bad actors from taking 
advantage of fraudulent loans. And we backed President Trump's 
efforts to move supply chains from overseas, cut regulations, 
lower taxes, and empower American entrepreneurs to succeed. By 
the end of your term, you had passed half a dozen bills into 
law and delivered $47 billion of relief funds to Georgia, to 
their employees, and to their small businesses.
    Kelly's career has been nothing short of amazing, proving 
that the American dream can be achieved through hard work, 
faith, with the right leaders in place. Kelly Loeffler is the 
right leader to put in place as the Administrator at the SBA. 
Her proven track record is why we can have great confidence 
that the SBA will return to the gold standard under your 
leadership.
    I'll just stop there with my prepared remarks and simply 
say that as a small business owner for 15 years, I have great 
confidence in your ability to do the job. To my fellow members 
of this committee, I hope that you'll hear her out, but I'm 
also asking for you to vote for her, because it is time for us 
to right the ship, to focus on the underserved communities 
around this country, and to make sure that every single ZIP 
Code in this nation has strong, powerful, small businesses. 
Because without small businesses, we will have high 
unemployment and low enthusiasm. Thank you for your time.
    The Chair. Thank you, Senator Scott, for that kind 
introduction. Now, I will note that the vote has started. So, 
if we have members further down the dais that would like to go 
vote now, please do so. Ms. Loeffler, if you would, please 
rise. We'll swear you in.
    Okay. Ms. Loeffler, raise your right hand. And this is the 
tradition of the committee to swear in our nominees. So, we are 
swearing in today Kelly Loeffler to be Administrator of the 
SBA. Please answer the following questions. Do you solemnly 
swear to tell the truth, the whole truth, and nothing but the 
truth, so help you God?
    Senator Loeffler. I do.
    The Chair. Should you be confirmed as Administrator, are 
you willing to appear and testify before any duly constituted 
Committee of Congress when requested to do so?
    Senator Loeffler. Yes.
    The Chair. Good. Okay. Are you willing to provide such 
information as requested by any such committee?
    Senator Loeffler. I am.
    The Chair. Thank you. You may go ahead and take your seat, 
Ms. Loeffler, and you are now recognized for five minutes to 
provide your opening statement to the committee.

   TESTIMONY OF THE HONORABLE KELLY LOEFFLER, NOMINEE TO BE 
          ADMINISTRATOR, SMALL BUSINESS ADMINISTRATION

    Senator Loeffler. Thank you, Chair Ernst. And let me just 
say it's a distinct honor to be here today. Chair Ernst, 
Ranking Member Markey, and members of the committee, it's truly 
an honor to be before you today as President Trump's nominee 
for the Administrator of the Small Business Administration.
    I'm as humbled to be here today as I was serving alongside 
many of you in the U.S. Senate, and I've appreciated the 
opportunity to meet with nearly every member of this 
distinguished committee in recent weeks.
    I'm especially grateful to President Trump for entrusting 
me with the privilege and responsibility of serving America's 
34 million small businesses. There is no stronger advocate for 
these job creators than our President, and I share his 
commitment. If confirmed, I will work tirelessly with him to 
make small business great again.
    I want to thank my incredible husband Jeff, my wonderful 
family and friends who have joined us here today and in person 
and via broadcast. Most importantly, I give all thanks and 
glory to God.
    As someone who has spent my life working in small 
businesses, starting them, growing them, and helping them 
succeed--I know that small business is big business for 
America. They comprise 99 percent of all businesses, they 
create two out of every three new jobs and employ nearly half 
of the private sector workforce. They are the opportunity and 
innovation engines that drive prosperity and growth and they 
power the American economy as much as they power the American 
dream.
    In his first term, President Trump made historic strides to 
empower job creators and job seekers alike, driving small 
business formation, a blue-collar boom. And through historic 
tax cuts, trade deals and deregulation, his agenda created 7 
million new jobs, delivered historically low poverty and record 
employment for minority communities.
    His first term accomplishments were so great that following 
the 2024 election, small business optimism recorded its largest 
jump since 1980. That was more than two months before he even 
took office.
    Small business is in my DNA. I grew up as the fourth 
generation on our family's farm in Illinois. My wonderful 
parents, Don and Lynda didn't have degrees, but they had faith 
and grit. They worked relentlessly to sustain our farm and 
small trucking company, risking everything to provide for us 
while navigating volatile commodity markets and complex 
regulations and facing countless day-to-day challenges.
    It's where my Midwestern work ethic was ingrained, working 
in our soybean fields, and waiting tables at local restaurants, 
preparing me for a lifetime of growing and starting businesses. 
I became the first in my family to graduate college, later 
earned my MBA and became the only CFA ever to serve in 
Congress.
    Since then, I helped grow a startup into a Fortune 500 
company. For 10 years, I co-owned a WNBA team. I later launched 
a financial tech company as the founding CEO and first 
employee. I recall managing budgets in excel spreadsheets, 
hiring my first team member and working with regulators, as 
much as I recall ringing the bell when two of those companies 
went public.
    In the Senate, I strongly supported President Trump's 
historic agenda and pandemic response. Having spent years as a 
small business owner, I made it my mission to serve as their 
voice. I spent much of 2020 delivering relief-traveling the 
state of Georgia and meeting with Main Street entrepreneurs 
like Eric and Rachel from Dockside Seafood in Savannah, they 
were struggling to navigate the PPP program. The loan that we 
helped them get didn't just save the restaurant, it saved the 
jobs of 35 Georgians. And I'm so proud to say that they're 
still in business today.
    Now, no matter the business, the challenges are 
consistent--from managing inflation and capital to hiring a 
skilled workforce and weathering uncertainty. Job creators in 
the last four years have faced rising demands to comply with 
new rules, often drafted with unknown cost and consequence. 
This regulatory complexity crushes growth, picks winners and 
losers, and denies opportunity to those who dare to dream of a 
better future.
    If I have the honor of being confirmed, I'll leverage my 
decades of business experience to champion America's 
entrepreneurs. We'll cut red tape and modernize this agency 
while restoring the accountability and transparency that 
taxpayers deserve. I will crack down on fraud with a zero-
tolerance policy while shifting SBA's focus from Washington, DC 
back to Main Street, across America.
    And if confirmed, I'll collaborate across government and 
the private sector to deliver efficiency and results. 
Importantly, we will responsibly and urgently meet the 
challenge of disaster relief. I am committed to serving all who 
are impacted from North Carolina to California to Hawaii.
    Each taxpayer dollar entrusted to the SBA should have an 
economic multiplier effect, delivering productive capital to 
grow manufacturing, strengthen rural communities, create jobs, 
and develop critical technologies like AI and chips. I believe 
we must continue to empower entrepreneurs from all walks of 
life, including women and veterans.
    Above all, the SBA's founding mission needs urgent 
restoration: empowering small businesses, and growing our 
economy. That's exactly what the America First agenda does--by 
ending inflation, cutting taxes, unleashing American energy 
dominance, slashing regulation, and reining in waste, fraud, 
and abuse across government.
    In the last four years, small businesses have lost ground 
burdened by inflation, big government regulation and 
uncertainty that threatens the very existence of Main Street. 
President Trump's proven agenda will restore the small business 
economy marking a return to ``Made in America''--with a golden 
era of prosperity and growth.
    At the SBA, that means meeting today's dynamic challenges 
alongside America's entrepreneurs, not by sitting in Washington 
or working from home. We will honor their jobs by doing ours.
    Small businesses are the risk takers, job creators, 
taxpayers, innovators, and the providers of first jobs. To 
former waitresses like me, they represent the best of American 
free enterprise. Like President Trump, I've signed the front of 
a paycheck. We both understand there is nothing ``small'' about 
small business.
    Chair Ernst, Ranking Member Markey, and committee members: 
thank you for your dedication to small business. I welcome your 
questions and I would be honored to earn your support to serve 
as the next Administrator of the Small Business Administration. 
Thank you.
    [The prepared statement of Senator Loeffler follows.]
    [GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]
    
    The Chair. Thank you, Senator Loeffler for your testimony. 
Before we move to questions, the committee has received several 
letters of support for Senator Loeffler's nomination, and I ask 
unanimous consent to enter into the record letters of support 
from the following organizations.
    America's Small Business Development Centers, Independent 
Community Bankers of America, Independent Women's Forum, Job 
Creators Network, National Association of Development 
Companies, National Retail Federation, Small Business Investor 
Alliance, Small Business and Entrepreneurship Council, National 
Association of Government Guaranteed Lenders, International 
Franchise Association, National Restaurant Association, Georgia 
Public Policy Foundation, Governor of Georgia--Brian Kemp, 
Association of Women's Business Centers, Economic and Community 
Development Institute, U.S. Black Chambers Incorporated, and 
the National Small Business Association.
    [The information referred to follows:]
    [GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]
    
    The Chair. Without objection, so ordered.
    So, at this time, we will go ahead and move on to 
questions. So, I now recognize myself for five minutes of 
questions.
    Senator Loeffler, in our conversation, you made it clear 
that given your time in the Senate, you understand the role of 
Congress. You denoted given your business experiences, you'd 
view us as your board and the taxpayers as your shareholders, 
with responsibilities to all of us to ensure the SBA moves 
forward in the right direction.
    Unfortunately, the Biden Administration did not share this 
view. I repeatedly requested information and those requests 
were ignored or fumbled. Can you commit to provide this 
committee with the documents and information at requests in a 
timely manner?
    Senator Loeffler. Absolutely Chair Ernst. I look forward to 
a collaborative and responsive relationship.
    The Chair. Yes, and I think that is essential to a good 
partnership between Congress, the Small Business 
Administration, and our constituencies. That's who we serve. 
So, thank you for that.
    Last year, SBA failed to alert or provide the committee 
with information before the agency ran out of funding for its 
disaster assistance program. Can you commit to more 
transparent, timely, and forthright dialogue between the SBA 
and this committee should you become administrator?
    Senator Loeffler. Absolutely, Chair Ernst. This should 
never happen again under my watch, it will not and we will work 
to make sure that we have all the controls in place.
    The Chair. Thank you for that answer. I'd like to move on 
to your goals and vision for the agency. Now, we know that it's 
extremely important to me that we right size the SBA and get it 
on a clear course to deliver its mission. Within your first 100 
days as administrator, what would be your primary goals and 
objectives to get the SBA back on track?
    Senator Loeffler. Thank you for the question, Chair Ernst. 
And I too enjoyed the time that we were able to spend together 
with you and your staff. I think your leadership of this 
committee is critical and I appreciate the work that you've 
done to date.
    I look forward to working with this entire committee toward 
the aims of restoring the Small Business Administration, to 
serving small businesses and supporting economic growth in this 
country, that's our North Star. In order to do that, we must 
have accountability at this agency--it's in dire need of 
restoration, and that starts with shoring up the financial 
situation.
    The fact that this agency has not been able to pass an 
audit for four years is a disgrace. We must make sure that we 
are accountable to taxpayers, that our programs are solvent and 
working toward the aims of serving small businesses. So, 
obviously, we're going to get our financial house in order and 
do it quickly.
    And we're going to do that, in addition to making sure the 
programs are working for small businesses and taxpayers, we 
know that the core (7a) loan program is in need of oversight in 
terms of understanding the rising delinquencies and defaults. 
We will take a hard look at that. We will make sure that the 
disaster funds are resourced and accounted for, and that there 
are no more situations where Americans in a crisis are faced 
with months of not having disaster relief.
    And then finally, we are certainly going to get this agency 
back to work. I am grateful for President Trump's rapid action 
through his executive order to return to work. We're going to 
make sure that we have people at work committed to the success 
of small businesses that have a heart for small business, but 
also have that sense of accountability to taxpayers.
    The Chair. Thank you so much for that. And as you talk 
about the audit, we know that we need transparency within the 
Small Business Administration, and hearing that is music to my 
ears. I began my elected career representing the taxpayers of 
Montgomery County as their county auditor. And I'm just excited 
to know that you will follow through on that commitment.
    As you know, I also serve as the Chair of the Senate DOGE 
Caucus, and we have a public mandate and a very rare 
opportunity to expose and roll back programs for what they 
truly are, multimillion dollar boondoggles. SBA is not immune 
to this, which provides us extraordinary opportunity to 
streamline and disrupt the bureaucracies and their status quo. 
Will you commit to examining programs to root out fraudulent 
actors?
    Senator Loeffler. This is critical because we're over four 
years past Covid. The last administration took a pass on 
rooting out fraud in these programs. I appreciate your work and 
your legislation, continuing Covid collections to make sure 
that we go after those that want to defraud the government. As 
I said, we'll have a zero-tolerance policy toward fraud, but 
also toward waste and abuse. And we will root that out within 
the agency and those that seek to exploit the programs.
    The Chair. Very good. Thank you very much, Senator 
Loeffler. At this time, I will turn the gavel over to Senator 
Curtis while I go vote. And I will recognize Ranking Member 
Markey for your questions.
    Senator Markey. Thank you, Madam Chair, very much. On 
Monday night, President Trump's budget office issued a memo 
that directed agencies to cut off all federal spending outside 
of payments to individuals. The Trump Administration issued 
this order even though this spending was authorized and 
appropriated by Congress and intended to benefit the American 
people.
    So, my first question is very straightforward, do you 
believe that this action by the President to cut off federal 
funding, authorized and appropriated by Congress, was lawful?
    Senator Loeffler. Senator, I disagree with the premise of 
your question because the money was certainly with regard to 
the agency's discretionary in many cases. But I fully agree 
with President Trump's decision to stop wasteful spend 
spending, it resulted in a landslide victory that many 
Americans were waiting for relief against excessive government 
spending that has----
    Senator Markey. He froze all programs. He did not freeze 
programs that had waste, fraud, and abuse. He froze all 
programs. Do you think that's lawful that he can freeze all 
programs?
    Senator Loeffler. With all due respect, I completely 
disagree. Not all programs were frozen at all. He, specifically 
in the OMB, called out programs related to illegal DEI programs 
and programs that effectively linked to the Green New Deal that 
picks winners and losers. And so, I think Americans breathed 
the sigh of relief when they saw that the waste, fraud, and 
abuse is going to get out of this government.
    Senator Markey. Wait, no, no. On the next day, OMB did put 
out a statement saying, funds for small businesses are not 
subject to the order. So, he did not single out all these 
programs, initially. They were under this cloud of freezing all 
programs, it had to be clarified. And that's good for small 
businesses, but only for now. This uncertainty, the cloud, 
which was placed over the head of small businesses across the 
country, that could return at any moment. It's just a dangerous 
precedent that the President set.
    I hope that you would hold President Trump to upholding the 
law. And if President Trump asked you to do anything illegal or 
unconstitutional in your role as SBA administrator, would you 
say no?
    Senator Loeffler. Ranking Member Markey, the President is 
not going to ask me to do that. I'm not going to create a 
hypothetical situation here. I will faithfully uphold the law 
and President Trump is fighting for Americans.
    Senator Markey. The President has already acted illegally 
twice in the last five days. He fired Inspector----
    Senator Loeffler. I respectfully disagree.
    Senator Markey. He fired the Inspector General, that was 
illegal under the law. He froze all funding on Monday night, 
that was also against the law. So, it's not as though he won't 
ask you to do something illegal, unconstitutional. He's been 
doing it all week. And this is the first week. So, let me move 
on. Since its creation in 1982----
    Senator Loeffler. Ranking Member, Markey, if I could, just 
for the record, note that these were not illegal actions. I 
support the President's actions, it's in his right to select 
the members of the executive branch, that's what he was doing 
and he certainly is in the right to stop wasteful spending as 
the President.
    Senator Markey. No, no. The President violated a statute by 
firing the Inspector General. It requires 30 days' notice, it's 
a statute passed by Congress, signed by a President. It's a 
violation of law. He does not have the ability to be a King, or 
a dictator. He has to follow the law, Senator.
    Senator Loeffler. I believe there's precedent for this in 
his right as the head of the executive.
    Senator Markey. Now, let me move on to SBIR which has had 
staggering success across the country and especially in 
Massachusetts. Overall, Massachusetts has received over 26,000 
SBIR and STTR awards, $9 billion in funding. And I strongly 
believe in these programs and their potential for just 
supercharging our economy as those programs have in 
Massachusetts and states all across the country.
    And when I met with you, you mentioned that SBIR awards 
should be awarded on a merit basis. And I agree wholeheartedly 
that merit drives innovation. So, will you commit to working 
with me and the committee to ensuring that any SBIR/STTR 
reauthorization effort maintains a merit-based process and does 
not limit innovation?
    Senator Loeffler. Absolutely, Ranking Member, Markey, if I 
have the honor of being confirmed, I will look forward to 
working with you. And I know we have a lot of common ground in 
support of small businesses, particularly the SBIR. And for 
those watching, it's the Small Business Innovation Research 
program that allows the United States to be at the forefront of 
technological, biomedical, and other types of national security 
related technology research and innovation that is so important 
to this country. Thank you.
    Senator Markey. Okay. Thank you.
    Senator Curtis [presiding]. Thank you. And now I will yield 
five minutes to myself. And I'm so pleased, Senator to have you 
with us and we'll call you Senator, at least for now. When you 
came into my office, I really appreciated the connection we 
made about small businesses in our own lives, and in your 
family's lives.
    And like many of the members here, we can all identify with 
the statistics in our state, I don't think they're very 
different, in mine, its 99 percent are small business, over 
half of all the employees in the state are small business. And 
it's such an important part of our economy, yet they often lack 
resources and don't have some of the advantages of larger 
businesses.
    And one of the things we discussed when you were in my 
office is how to best hook up the resources of your 
administration with those small businesses in our state. You 
were generous, if I remember correctly, to offer to come out to 
our state, and I'm getting a nod ahead, so I'm going to take a 
yes for that. And I think as part of that, not just you coming 
out, but helping educate my small businesses about what's 
available to them and how they can access those. So, we'll look 
forward to your visit.
    Senator Loeffler. Thank you, Senator. I'm very excited 
about visiting your town, I'm excited to have you in the Senate 
and appreciated meeting with you and your staff in the basement 
office. I used to have a basement office. It's a great way to 
start. [Laughter.]
    Senator Curtis. It's like a small business, right?
    Senator Loeffler. That's right. It's a small business.
    Senator Curtis. I think we talked about--I had a small 
business before I came here. My father was a small business 
owner. My grandfather was a small business owner. My daughters 
and children have small businesses. And one of the things that 
I don't think America realizes is that most of these small 
businesses struggle just to keep the lights on, right? It's 
hard paycheck to paycheck.
    They don't have a lot of money to do a lot of things other 
people do. Part of that is they don't have the money for 
lawyers and attorneys to deal with the excessive regulations 
that sometimes we can put on them here from Washington, DC. And 
as a result, I believe regulations are disproportionately hard 
on small businesses.
    So, share with me for a minute what you can do to lighten 
this burden and how do we make sure here in Washington that 
we're not the biggest problem with small businesses?
    Senator Loeffler. Senator, thank you for recognizing that 
vital issue to America's 34 million small businesses many who 
have fewer than nine employees. And, you know, in answering 
your question, I'd like to speak to small businesses in saying 
you have someone that, if confirmed, will understand what it's 
like to have a small business--to worry about meeting payroll, 
let alone paying the bills for the small business, particularly 
with the setbacks that small businesses have had in the last 
four years, losing about 10 percent on the top line revenue 
while seeing their costs increase by 20 percent due to 
inflation.
    So, small businesses have lost ground. Now, the SBA can be 
a way of helping small businesses combat what has been a tough 
four years if we deploy the resources appropriately and 
prudently so that the small businesses who need it most have 
access to that, be it through capital, be it through technical 
assistance or other ways of supporting entrepreneurship in this 
country, which is so vital to our advancement on a global 
stage, but also within our local communities.
    These are the businesses that sponsor the softball teams. 
These are the businesses that provide that first job, and 
they're the ones that never work from home. They show up, they 
turn out their commitments to their customers, and that's 
absolutely what we're going to do at the SBA.
    Senator Curtis. Great. I appreciate that. Looking forward 
to working with you on that. Kind of a sister to that would be 
just federal policy in general and we know we're going to be 
talking about tariffs in the upcoming days. Once again, these 
are disproportionately hard on small businesses, and we had 
this conversation in my office too, would love to invite you to 
work with the administration and the Senate as we move into a 
world where tariffs are real reality, to figure out how to help 
small businesses accommodate better to those tariffs', things 
like a different runway timeframe and when those hit the small 
businesses.
    Can you just comment on how we can deal with our small 
businesses and what might be one of their most difficult 
challenges?
    Senator Loeffler. Thank you, Senator. If I have the honor 
of being confirmed, I will be a voice for small business. But 
let me assure you, there is no bigger small business champion 
than President Trump. He will make sure that small business has 
a voice at the table. But I also think it's important that we 
look at the data and not the hyperbole that happens sometimes 
in the media.
    President Trump was successful in implementing tariffs in 
his first term, but also successful at keeping inflation right 
around that 2 percent mark, which really, you know, some facts 
that the media always overlooks. So, you have my commitment 
that small businesses will be considered in all the decisions 
we make. And that's something that I know firsthand from 
President Trump. He is their biggest advocate.
    Senator Curtis. I think I should yield my time. Thank you. 
[Laughter.]
    The Chair. And thank you Senator Curtis for manning the 
chair. I now recognize Senator Hirono.
    Senator Hirono. Thank you, Madam Chair. Mrs. Loeffler, 
welcome. As part of my responsibility as a member of this 
committee, as well as all the other committees on which I sit, 
I ask the following two initial questions of all nominees who 
come before any of my committees. So, I'll ask you, since you 
became a legal adult, have you ever made unwanted requests for 
sexual favors or committed any verbal or physical harassment or 
assault of a sexual nature?
    Senator Loeffler. No, Senator.
    Senator Hirono. Have you ever faced discipline or entered 
into a settlement relating to this kind of conduct?
    Senator Loeffler. No, Senator.
    Senator Hirono. During the pandemic, you opposed Planned 
Parenthood Health Centers receiving PPP Loans for ideological 
reasons even though, like other nonprofits, they were eligible 
for loans as later determined by SBAs own inspector general. 
Last week, the President fired the IG without proper notice as 
required by law. And it's clear that President Trump believes 
he can do whatever he wants. As the Administrator, should you 
be confirmed, would you commit to implementing SBA programs in 
a fair and impartial manner?
    Senator Loeffler. Senator Hirono, let me first say, I hope 
that we could be able to meet, I'd requested several meetings. 
I keep the people of Maui in my prayers. I know that they're 
still struggling through the disaster that occurred about 18 
months ago, and I hope that we can work together.
    But let me correct with all due respect both premises of 
your question. I objected to the Planned Parenthood receipt of 
Covid relief loans because they did not fit the parameters of 
the program because of the affiliation----
    Senator Hirono. Actually, Mrs. Loeffler, you do know that 
the IG took a contrary position. So, all I'm asking is whether 
you can be fair and impartial in being the administrator of 
SBA, a very important position. As you say, there are so many 
small businesses throughout our country. So, just a simple 
affirmation that you can do so is what I'm asking.
    Senator Loeffler. Senator, I will faithfully uphold all of 
the laws and ethics rules.
    Senator Hirono. Well, the thing is that, as I mentioned 
with President Trump, the laws that he likes are the ones he 
likes, and then the ones he doesn't like, he considers them to 
be illegal. But I will move on.
    As a Senator, you co-sponsored the resolution, recognizing 
Brian Sicknick, the U.S. Capitol police officer, who was 
brutally attacked during the January 6th insurrection and who 
later died. As a result, last week, the President issued 
blanket pardons for the January 6th Insurrectionists, including 
those responsible for attacking Officer Sicknick. Do you agree 
with the President's decision to pardon these violent 
offenders? Yes, or no?
    Senator Loeffler. Yes, Senator. I strongly support 
President's pardon. These individuals were denied due process 
and it's time to get past political persecution in this 
country. That's what Americans voted for.
    Senator Hirono. Mrs. Loeffler, they were not denied due 
process because they were tried and found guilty, and some of 
them even admitted their guilt. So, I am disappointed that you 
agree that these violent, basically criminals, should be 
pardoned.
    Then, we get to the Lahaina Wildfire. In 2023, Lahaina 
experienced wildfires that devastated the entire community, 
including schools, homes, businesses, and more. Key to their 
recovery has been what I've described as the federal family of 
agencies, which of course includes FEMA and SBA.
    Last week, the President proposed eliminating FEMA and he 
said, ``Let the states take care of the tornadoes and the 
hurricanes and all of the other things that happen''. So, I 
have seen the devastation in Lahaina and the rural FEMA and SBA 
played in the recovery. The SBA itself provided hundreds of 
millions of dollars in loans to help the Lahaina recover. It 
would be a huge mistake to eliminate SBAs role in disaster 
response and relief, and have states fend for themselves.
    Do you agree with the President's recent comments that 
states should be left to fend for themselves during and after 
natural disasters? That's another yes or no question.
    Senator Loeffler. Senator, I disagree with the premise. The 
President strongly supports disaster relief. He was on the 
ground just last week in North Carolina.
    I also mentioned Hawaii in my opening remarks, that we do 
support the continued relief there.
    Senator Hirono. So, you support the continuing involvement 
of the SBA in recovery.
    Senator Loeffler. Yes. And the President's been clear that 
individual assistance will not be paused.
    Senator Hirono. I'm glad you do and that you support the 
continuing role, important role of SBA. When you were running 
for U.S. Senate, you----
    The Chair. The Senator's time has expired,
    Senator Hirono. Time flies. Are you having a second round?
    The Chair. We can do a second round. Yes.
    Senator Hirono. If not, I'll certainly submit questions for 
the record. Thank you.
    The Chair. Thank you, Senator Hirono. Next, I will 
recognize Senator Budd for five minutes of questions.
    Senator Budd. Thank you, Chair, Senator Loeffler, 
congratulations on your nomination. Thanks to your family and 
your friends for being here and for leaving your role in 
private work twice to serve our country. So, thank you for what 
you're willing to do.
    Your state and my state and several others have gone 
through quite a lot since late September with Hurricane Helene. 
In the moments where I wasn't in Western North Carolina myself, 
I was able to see--if I was able to look up and see a 
television. It was you standing there, I believe it was in 
Valdosta with President Trump, committing that if he were 
reelected, he would support. He's lived up to that. He's been 
back to Western North Carolina. I believe he's our rebuilder-
in-chief.
    So, one of the things that we saw was that the SBA under 
President Biden, it failed to notify Congress in a timely 
manner about the depletion of the Disaster Relief Fund and 
didn't fulfill their reporting requirements along the way. So, 
if confirmed, how would you ensure timely and accurate 
reporting to Congress regarding disaster loan account balances 
and funding needs? And how would you address the transparency 
failures that we saw during the Biden Administration?
    Senator Loeffler. Thank you for this important question, 
Senator. And let me assure you, my prayers are with the people 
of Western North Carolina. I know the President was there 
recently, and is truly the rebuilder-in-chief, as are many 
private enterprises in your own state, Samaritan's Purse, and I 
thank them for their dedication across the Southeast. And my 
prayers are with the people of Georgia and all impacted.
    But let me say what happened on October 15th, when Congress 
was shocked by the news that despite assurances two days 
earlier, the disaster relief funding had run out. Now, in 
business, this would never be tolerated. And we see examples of 
this everywhere within this agency that I know we're all trying 
to get our arms around and make a quick correction on.
    You have my commitment that we will ensure that disaster 
relief funding is there for hardworking Americans when they 
need it. And I look forward to your feedback on how the 
response has been so that we can strengthen the program and 
having the transparency so that this committee is routinely 
apprised of the status of the agency across all vectors that 
we're serving the American people on.
    Senator Budd. Thank you for that. So, the SBA disaster loan 
program, you know, it's critical in supporting small 
businesses, as you've mentioned in a few of your earlier 
remarks and also being there to help communities during crises. 
But we have recent disasters like Hawaii or for us, Helene, 
that really revealed a lot of real shortcomings in the SBAs 
management and oversight of its disaster loan portfolio.
    So, these have led to funding shortfalls, lack of 
transparency, administrative inefficiency that really hindered 
a timely disaster response and recovery. The people of Western 
North Carolina, I know of North Georgia as well, they felt 
these failures firsthand when they needed assistance. Most 
instead, they were left waiting due to the SBA's mismanagement 
during a time of dire need.
    So, Senator, will you commit to working with my office, and 
this committee to address these shortcomings and ensure that 
the SBA is fully prepared to respond effectively to the needs 
of businesses in North Georgia, Western North Carolina, and the 
other states that are in need from disasters?
    Senator Loeffler. Absolutely Senator, you have my 
commitment. Thank you.
    Senator Budd. Senator, the numbers paint a troubling 
picture for small businesses. You know, there was a survey from 
2023-2024. It was the Intuit QuickBooks Small Business Index, 
and it says that small businesses employment declined over 
51,000 jobs. And it also said that revenue fell on average for 
those businesses about $12,000, that's a lot for a small 
business. So, and that's also the steepest year over year 
decline since the Obama administration of 2015.
    That same time, the 2024 Goldman Sachs 10,000 Small 
Business Voices survey revealed that 77 percent of small 
businesses are deeply concerned about their ability to access 
the capital that they need to operate reliably. So, as you 
know, small businesses, it makes up the bulk of our economy. I 
think President Trump has said small business is big business. 
So, and this level of decline is, I would imagine, you would 
think as well is it's unacceptable. So, under President Trump's 
leadership, how can we expect to see a new golden age for our 
small businesses?
    Senator Loeffler. Absolutely. Thank you for that question, 
because President Trump is restoring the golden era for all 
Americans by strengthening our economy, making our country more 
safe and secure, and ensuring wasteful taxpayer spending is not 
driving up inflation. Inflation is the number one problem, not 
only facing families, but small businesses. They're looking at 
20 percent higher costs on at least 10 percent lower revenues. 
That's an unsustainable situation for our employers who are 
putting it all on the line. And small businesses have my 
commitment that I will have their back.
    The Chair. Thank you, Senator Budd. I now recognize Senator 
Schiff for five minutes of questions.
    Senator Schiff. Thank you, Madam Chair. It's an honor to 
serve on this committee and represent California's 4.2 million 
small businesses, including tech, startups, nonprofits, 
childcare centers, rural businesses, the arts and entertainment 
industry, and women and minority owned businesses. That number 
is growing daily, and I am very proud to represent these 
incredible business owners, innovators, and hardworking 
employees. Senator Loeffler, I appreciated the conversation 
that we had last week. I think it was last week. The weeks have 
seemed endless these days.
    As you know very well, horrific wildfires and high winds 
have ravaged California over the last month, displacing 
thousands of families and destroying homes, schools, community 
centers, places of worship, and countless small businesses. As 
these fires have impacted the livelihood of innumerable 
Californians, it is crucial that we know California will have 
the full support of the federal government to respond, to 
recover, and to rebuild. And we must rebuild resiliently.
    The SBA provides disaster assistance for homeowners, 
renters, nonprofits, and businesses of all sizes affected by 
natural disasters. I got to see this really in operation, 
visiting the Discovery Resource Centers in Los Angeles, in 
Westwood, and in Pasadena. SBA was on hand in large numbers to 
help small business owners and homeowners find what resources 
were available to them to help them recover and rebuild.
    I do want to echo the concern raised by my colleague, 
Senator Markey, about the freeze on federal funding. I know 
there has been a subsequent statement saying that the freeze 
order has been lifted, but not the freeze. None of us really 
know how to make heads or tails of that. But what concerns me 
is that even if the administration says that help to 
individuals will not be affected by this, if federal funding to 
SBA is curtailed, then it means SBA cannot make loans to 
individuals and to small businesses. And at a time when 
California's desperately need that help, any delay, any 
uncertainty will just add additional injury.
    I've also been distressed by some of the calls to condition 
funding to California. California has contributed more to the 
recovery of other states than any other state of the Union. And 
I want to ask you, first of all, to recommit to something we 
discussed privately, and that is to ensuring if confirmed, that 
all states, not just California, but all states, receive speedy 
relief for disaster victims and survivors without regard for 
whether a state is red or blue, or green, or yellow, or 
anything else. Are you committed to in a colorblind political-
affiliation blind way, make sure that SBA assistance is 
speedily provided to small businesses in every state?
    Senator Loeffler. Senator, I appreciated our time in being 
in your office and discussing this important matter. Obviously, 
my prayers are with California, but our efforts will be there, 
as well as President Trump demonstrated by his first official 
trip.
    Typically, Presidents might fly outside the country. He 
went to California. He immediately appointed a task force, 
getting the very capable, Rick Grenell, involved. I think the 
President's actions have demonstrated his support for disaster 
relief. He's done it effectively in in his last term, and I 
will support his efforts and leadership to ensure the people of 
California have the resources they need under President Trump's 
leadership.
    Senator Schiff. Well, let me just say I was grateful the 
President came to Los Angeles. I felt that if he saw the 
damage, he could not help but be moved, and I think and hope 
that he was. I am concerned, though, about some of the 
statements he has made about tying disaster assistance to the 
passage of completely unrelated voter ID laws, or frankly, any 
other unrelated policy matter.
    Let me also raise the need to, not just with respect to the 
disaster in California, but elsewhere, make sure that the SBA 
is proceeding a pace with a sense of urgency, that it is 
efficiently and effectively processing loan applications. I 
realize the balance is difficult because you have to avoid 
fraud, and there was massive fraud among some who were applying 
for Covid relief. We do not want to see that repeated, but 
nevertheless, we don't want to see excessive delays either.
    Frankly, I think firing the inspector general harms the 
ability to fare out waste, and fraud, and abuse. But are you 
committed to doing everything you can to provide speedy 
attention to SBA applications while providing at the same time 
safeguards to avoid fraud?
    Senator Loeffler. Yes, I am Senator. Thank you.
    Senator Schiff. Thank you, Madam Chair--or Mr. Chairman?
    Senator Hawley [presiding]. Thank you very much, Senator. 
On behalf of the chair, I'll recognize myself. Senator 
Loeffler, it's great to see you. Thank you for being willing to 
do this job. As you and I discussed when we met in my office, I 
loved serving with you. You were a terrific Senator, and I'm 
just so glad that you're willing to do this job. It's going to 
be a great, great service to our country.
    Let me just ask you a question or two, to start with, about 
the priorities at SBA. I noticed that on day one of his 
administration, the last President issued an executive order 
directing federal agencies to adopt a broad racial equity 
agenda. And that was particularly a focus of SBA over the last 
four years.
    In fact, according to one report, by far, the largest 
program that uses racial preferences in the federal government 
is the 8(a) Program run by SBA. To be eligible for it, 
companies had to show various racial and other characteristics 
in order to access funding. A federal court in Tennessee ruled 
it unconstitutional. Another federal court struck down a 
similar requirement, also administered by SBA, the Restaurant 
Revitalization Fund.
    Here's my question to you. President Trump has now, 
thankfully, with his own executive order, said we're going to 
put a stop to these DEI programs. How do you see implementing 
that at SBA, and will you get SBA refocused on actually helping 
small businesses no matter who the owner is, no matter where 
they are? There'll be no tipping of the scales in order to fit 
some bureaucrat's agenda. We're going to help those in need, 
get them stood up. We're going to execute on the mission of 
SBA. Tell us what you'll do about that?
    Senator Loeffler. Senator, thank you. Thank you, and I 
appreciate the time we spent in your office discussing these 
matters. Importantly, President Trump's EO overturns a divisive 
and illegal DEI program that was spread throughout the 
government, and particularly within the SBA. This will allow us 
to reduce the burdens on small business for costly 
implementation of needless programs.
    But moreover, I think the best way we can serve small 
businesses is making SBA lending available to all who qualify, 
as opposed to picking winners and losers, and pitting Americans 
against one another. So, you have my full commitment that we 
will root that out and make sure that it is broadly available 
to all who qualify.
    Senator Hawley. That's a fantastic answer. I'm glad to hear 
it. And let me just ask you about another priority. While the 
last administration's Small Business Administration was focused 
on this DEI agenda, what it was not doing was helping people in 
rural areas of the country, like most of my state.
    In Fiscal Year 2024, just to take one example, SBA made 
103,000 loans. Only 12,000 of those went to rural businesses. 
That's just over 12 percent of SBA's $56 billion in capital 
last fiscal year. Only $6 billion went to rural businesses. 
That's just 11 percent there. You want to talk about inequity? 
There's an imbalance between urban and rural.
    And listen, we've got urban centers in my state as well. 
I'm all for small businesses in urban centers getting what they 
qualify for. But would you agree with me that our small 
businesses in rural America are extremely important? They're 
often the lifeblood of our communities. Like, the small town 
where I grew up, 4,000 people, relies on small businesses.
    What will you do to make sure that small business in rural 
America is a priority? That they're getting access to the funds 
that they qualify for, and we're doing everything we can to 
help these small businesses revitalize these communities?
    Senator Loeffler. Well, Senator, not only do I agree with 
you, I've lived it. I was raised in a family of fourth 
generation small business. My nearest town had 600 people in 
it, and my high school had 8 small towns. Many of my fellow 
students, parents, were small business owners. I saw the hard 
work that they did, the complexity of dealing with increased 
federal regulation even back then.
    And we have to ensure that small businesses in rural 
communities are getting the support they need. I understand it 
firsthand. And I know that we can do better, and we will do 
better because this is an area that we can grow in terms of 
bringing manufacturing, ``Made in America'', again, can come 
back driven by rural America and paying attention to people 
that have been forgotten about. That's what President Trump 
does. He remembers the forgotten men and women working so hard 
in this country to make it work.
    Senator Hawley. Fantastic. Well, I welcome your focus on 
this. I look forward to working with you. Let me ask you just 
about fraud, and waste, and abuse. And you've talked about this 
some. I think your answers have been very heartening. You 
remember, in fact, you referenced it at the height of the 
pandemic. Congress enacted this so-called CARES Act to provide 
very necessary relief to millions of Americans. We also, at the 
same time, created, however, a Special Inspector General to 
monitor any fraud and abuse in that program.
    Now, for reasons that continue to elude me, the last 
administration, the last President when he came to office, 
almost immediately limited the remit of this Special Inspector 
General, then tried to effectively defund it. And now, we find 
out hundreds of billions of dollars were wasted or fraudulently 
dispersed, or not properly paid back under these programs.
    Would you agree with me that we need the Special Inspector 
General, SIGPR, we need that office to be properly funded. We 
need it to be given the jurisdictional authority that it 
deserves. Senator Ernst has a bill to make sure that SIGPR gets 
that jurisdictional authority. Would you support that? And can 
you talk to us about the need to be rooting out fraud, and 
abuse, and corruption?
    Senator Loeffler. Absolutely. Senator, if I'm confirmed, I 
look forward to working with this committee to have a higher 
standard of accountability, to act with more urgency, to have a 
zero-tolerance policy with regard to fraud, and to making 
taxpayers whole. We have to get back to that accountability and 
getting those funds back into taxpayer hands as soon as 
possible.
    Senator Hawley. Very good. Thank you. And now, I'll 
recognize Senator Shaheen.
    Senator Shaheen. Thank you. Congratulations, Senator 
Loeffler on your nomination, and thank you for your willingness 
to serve. Welcome to all your family and friends who are here 
with you this afternoon.
    New Hampshire, like many of the states represented on this 
committee, has over 99 percent of its businesses who are small 
businesses. I certainly agree with the fact that small 
businesses are the lifeblood of this country. Two-thirds of 
jobs are created from small businesses. My favorite statistic 
about our small businesses is that they create 16 times more 
patents than large businesses. So, it's critical that we 
provide assistance to ensure that they thrive.
    Now, I heard from one of our businesses in New Hampshire 
yesterday that sells agricultural equipment to universities, 
and they help research feed efficiency to help farmers. He was 
worried about the halt to funding this week. So, the order that 
freezes spending caused him to worry about his businesses. So, 
what would you say to that business owner so that they're 
reassured that their orders are going to continue?
    Senator Loeffler. Senator, I appreciated the chance to meet 
with you in your office, and with your staff, and your 
leadership in this committee as well.
    Certainly, the facts are that no individual assistance was 
or is part of that pause. What the President is rightfully 
doing is fulfilling his commitment that overwhelmingly 
Americans agree with, which is to root out waste, fraud, and 
abuse in spending programs. And it's not uncommon for 
Presidents to come in and put a pause on agency discretionary 
funds that could be contributing to the problems we have with 
debt, with inflation.
    And there's no bigger champion of small businesses than 
President Trump. He's told me, personally, that small business 
is big business and he gets it. So, small businesses can be 
assured that they will have a champion in me as well. Having 
been raised in a small family business, I know the risks that 
small business operators bear every day, and we will ensure 
that they have a voice in this administration, and they do.
    Senator Shaheen. Well, I certainly agree that it's 
reasonable to review how programs are working, and that we all 
should be in favor of getting rid of waste, fraud, and abuse. 
That doesn't help anybody. I think what's unprecedented about 
the current situation is the uncertainty that it creates for so 
many of the people who benefit from those programs, and the 
fact that it's so broad and far-reaching.
    I enjoyed the opportunity to meet with you, and thank you 
for coming in and talking. One of the things that we discussed 
was the importance of our field offices within the SBA. And I 
was pleased that Chair Ernst mentioned the importance of 
ensuring that we keep people in the field offices and not 
reduce those staff members, because that's where so much of the 
help for our small businesses comes from.
    So, can you reassure us that you will focus to make sure 
that the district offices have the support they need and are 
able to staff up in the way that helps our small businesses?
    Senator Loeffler. Absolutely. Senator, if confirmed, I can 
assure you, we will put an emphasis on the field. And we have 
in the SBA 10 regional offices and then 68 field district 
offices. And the great aspect of this is we can be out with our 
entrepreneurs, with our small businesses, not only delivering 
capital, but the technical support and counseling that they 
need to succeed. Because we know that when small businesses 
have the counseling and mentorship that they need to fill in 
any gaps, they are more successful.
    And I've heard so many great stories from small businesses. 
I know you hear them every day who rely on just that extra 
little help to become successful. I've seen them in our own 
community. So, you have my commitment. I look forward to 
visiting your state as well.
    Senator Shaheen. Good. Thank you. We look forward to having 
you come to New Hampshire. One of the most important roles you 
will have is as a spokesperson for small businesses. I was 
pleased that President Trump continues to maintain the SBA 
administrator as a member of his cabinet. I think that's very 
important.
    And one of the issues that I've been proud to work on that 
I think we need to continue to focus on for our small 
businesses is helping them access foreign markets. Because so 
many, 99 percent of markets, are outside of the United States, 
but only about 3 percent of small and medium-sized businesses 
do business outside of the United States.
    I was proud to help create the State Trade Expansion 
Program, the STEP program. I would hope that, again, you would 
commit to continuing to support that program and helping our 
small businesses get into those international markets.
    Senator Loeffler. Certainly. The STEP program is a very 
appealing program to understand how we can broaden our work 
with exports, and small businesses can play a tremendous role 
there. I look forward to working with you and the entire 
committee to see where we can broaden the export program and 
make this more efficient, and to deliver more wins for small 
businesses.
    Senator Shaheen. Thank you. Thank you, Madam Chair.
    The Chair [presiding]. Thank you, Senator Shaheen. I'll 
recognize Senator Young for five minutes.
    Senator Young. Thank you, Madam Chair. Welcome, Senator 
Loeffler. It's great to see you here today. And congrats once 
again on this nomination. It's good to see your husband, Jeff, 
a Hoosier, fellow mid-westerner behind you as well.
    When my father heard not only that I was elected to the 
United States Senate, but that I was going to sit on the Small 
Business Committee in the U.S. Senate, I can't tell you how 
excited he was. He perhaps perceived this to be known as the 
most powerful committee in the U.S. Senate. It's not always 
known for that, but it was the most important committee to my 
dad. Because when my dad was getting started in the business, 
he relied on SBA support loans in particular to help him grow 
his business. And for him, this was the most important 
committee.
    And there's a certain wisdom to that as you travel around. 
As we travel around our various states, we see that most jobs 
these days are actually created, not by large enterprises, 
because those come and those go--they're great for ribbon 
cutting sometimes--but it's usually the smaller enterprises.
    And to the extent we can optimize our policies so that more 
people will start these small businesses and they grow into 
larger businesses, that's kind of the key to economic 
development. So, really important post you're going to be 
occupying here. If confirmed, how are you going to work to keep 
our small businesses competitive today and resilient tomorrow? 
Kind of an open-ended question.
    Senator Loeffler. Thank you, Senator. And I agree with your 
dad. I think I couldn't be more humbled by this awesome 
responsibility for small businesses that power our local 
communities, that do create two out of every three new jobs in 
America. That's incredibly powerful.
    So, I think there's a number of things we can do to make 
small business more competitive. First of all, respecting that 
small business is about free enterprise and it's not about the 
government. So, we have to look at ourselves and say, what are 
we doing within this agency to make it harder for small 
businesses to access capital, to access perhaps government 
contracting or counseling.
    Are we there for them? A big part of that is getting 
everyone back in the office, off the golf course, into the 
office, being aligned with our small businesses where they are 
on Main Street and not K Street. So, my focus is certainly 
going to be on the field activity. Making sure everyone in the 
agency's accountable, and making sure the programs actually 
work for small business. We'll be doing a deep dive.
    Senator Young. So, I think, directionally, you're 
absolutely on the right course, and that's the most important 
thing, at this point. Do you have specific ideas about how SBA 
might be modernized and improved under your leadership?
    Senator Loeffler. Well, certainly, I don't want to get 
ahead of myself. If I have the honor of being confirmed, I 
would look at a broad range of efficiency, both cost and 
technological efficiencies that could be gained. I'll be 
looking at organizational design. I'll be looking at skill sets 
and training that might be needed to deliver our services to 
increase our response times to small businesses. And we'll be 
metrics driven. We'll have goals, and we'll be reporting that 
out to this committee.
    Senator Young. Well, I think there are members of this 
committee, count me in, who want to help you and the rest of 
the administration be successful as it relates to small 
businesses and the Small Business Administration.
    One of the things that you might consider doing is 
prioritizing an incentive for new businesses and small 
businesses to adopt the latest technologies. I just had a great 
exchange with Howard Lutnick, the Secretary of Commerce 
nominee, and we emphasized the importance of digital trade, 
which he strongly supports, unlike unfortunately, the previous 
administration. But I think that's encouraging.
    But I've related to the Small Business Administration, I 
found that many Hoosier small businesses rely on digital tools, 
but the law doesn't clearly state if these costs qualify within 
the 7(a) loan program. So, if someone wants to buy an AI 
technology, for example, it's unclear if the law will include 
that. So, I've introduced legislation along with Senators 
Rosen, Budd, and Shaheen, the Small Business Technological 
Advancement Act that would clarify and promote the purchase of 
digital tools with small businesses. If confirmed, would you be 
willing to work with me on this topic?
    Senator Loeffler. Senator Young, absolutely. If confirmed, 
I would be. AI is at the forefront of both as President Trump 
said, a wakeup call to American innovation, but potentially as 
tools for automating small businesses, making them more 
efficient. And whether it's things like co-pilots or agents, I 
would support looking at that as a solution.
    Senator Young. Well, thank you. And I will be submitting a 
question for the record on another important topic I know to 
you in our small businesses about how you intend to address 
bolstering SBA's cybersecurity infrastructure. Thanks so much.
    The Chair. Very good. Thank you, Senator Young. Senator 
Coons.
    Senator Coons. Thank you, Chair, and thank you, Senator. 
Great to be with you, and thank you to your family and those 
who are here to support you. As I hope you know, your 
predecessor in the this position, in the previous two 
administrations, I've had a particularly strong working 
relationship with. SBA Administrator McMahon came to visit 
Delaware several times. We worked well together.
    I would agree, my dad said the same thing, to Senator 
Young's comment. My dad started and ran a small manufacturing 
business, and he thought this was the most exciting committee I 
could possibly be on. And it has been in the past, a very 
productive committee. My hope is that we will get back to 
churning out legislation that works with you, that we will 
appropriately authorize and appropriate funds, review funds and 
programs.
    When we had a chance to meet two weeks ago, one of the 
programs I brought up was SCORE, which I suspect everyone 
knows, was founded in Wilmington, Delaware, thus, my obsession 
with SCORE. But I think one of the highest, federally-
appropriated dollar for actual impact programs in history. 
There's more than 10,000 volunteers through SCORE who deliver 
roughly 4 million hours a year of free business plan 
consulting.
    SCORE clients return $59 in tax revenue for every dollar 
appropriated to SCORE. It needs to be reauthorized. We need to 
look at it to ensure it's operating well and that there's 
accountability. Would you support SCORE and its 
reauthorization, and work with me to achieve a bipartisan 
reauthorization, if confirmed?
    Senator Loeffler. Senator Coons, I thank you for the time 
shared in your office. I was also just delighted to hear now 
about your dad's sentiments. I agree. And I look forward to 
working with you to review SCORE, see how it can be made more 
robust, and to evaluating the program, and sharing all of that 
data with this committee so that we have a very collaborative 
approach to ensuring our efforts are making a difference for 
small businesses.
    As you note, it's definitely had an impact, and we want to 
make sure that programs that work are made available to more 
entrepreneurs.
    Senator Coons. Well, those 10,000 volunteers help more than 
300,000 entrepreneurs, so I'm very hopeful we can work together 
on that.
    A piece of legislation, Senator Rubio and I, now Secretary 
Rubio, and I worked on for several Congresses was to help make 
sure that SBIR grantees actually produce commercialized 
technology. About half of SBIR awards lead to commercialize 
technology, but half don't. And this would specifically 
authorize some of the pre-market scale up costs through SBIR. 
It's called the RAMP for Innovators Act.
    The SBA plays a critical role in coordinating SBIR 
activities across the whole government. I'd be interested in 
what your priorities would be for SBIR as a program, and 
whether you would help work with us on reauthorization and 
ensuring that it doesn't just fund endless research, but 
actually funds the leap to the marketplace.
    Senator Loeffler. Absolutely, Senator. I think the Small 
Business Innovation Research grants are critical to solving 
some of the challenges America has in scaling our technological 
innovations quickly. The program gives more dry powder and 
runway to these important technological breakthroughs, whether 
in the area of bioscience technology, AI, drones, mission-
critical things to our national defense. That would not be 
possible without the support of research institutions.
    So, I look forward to collaborating with this entire 
committee on the reauthorization and reviewing the program for 
where it can be strengthened to produce more efficient results, 
and to highlighting some of the wins to ensure that these are 
wins that generate a powerful return on taxpayer investments.
    Senator Coons. Another concern I've expressed in previous 
Congresses is the amount of federal contracting money that's 
going to small businesses. Small businesses continue to get a 
robust piece of the total federal pie. I think it's 28 percent, 
which exceeds the target, but it's for a smaller and smaller 
number of larger and larger small business firms.
    I'd also be interested in working with you to make sure 
that we actually are contracting, federally, as broadly as 
possible to as many small businesses as possible. I think as 
literally every colleague has referenced, 98 percent of the 
businesses in my state, even in the State of Delaware, which 
has a whole lot of incorporation are small businesses.
    Would you work with me to make sure that we achieve those 
goals in terms of small business contracting?
    Senator Loeffler. Absolutely. Senator, I've confirmed I 
would like to work with you on that. I do agree that this 
program is vital for small businesses to have an awareness of 
and to have access to the program. If the programs become too 
complex that only a select few can find their way in, that 
voids the program's foundational beginnings.
    So, I would look forward to working with the entire 
committee to ensure small businesses have an additional path to 
success. And I also wanted to acknowledge Administrator McMahon 
and her great work. And I hope that we can have the same 
constructive, collaborative great relationship working for 
small businesses. Thank you.
    Senator Coons. I look forward to it. Thank you, Senator.
    The Chair. Thank you, Senator Coons. Senator Husted.
    Senator Husted. Thank you, Chair Ernst, and Ranking Member, 
and my fellow colleagues. Great to join you on the Small 
Business Committee. And, Senator Loeffler, congratulations on 
your nomination, and look forward to supporting you when your 
nomination comes to the Senate floor.
    I know you are entering this job at a difficult time in the 
sense that there have been a lot of questions about fraud that 
occurred and loss of money that has occurred during the 
pandemic. And there will be an expectation of accountability, 
which there should be for every tax dollar we spend.
    But at the same time, we know that speed is--you know, time 
is money in business, and small businesses, particularly during 
a time of natural disaster or when they're just really trying 
to be able to make ends meet, to keep the business open and 
they may need help from the SBA. So, that time is also so very 
important.
    So, just give me some insights and to the committee as to 
how you expect to balance that accountability and speed?
    Senator Loeffler. Thank you, Senator. And thank you for 
making time to meet in your first week here in the Senate. I 
enjoyed our conversation and know that small businesses have a 
champion based on your work in Ohio for them.
    You ask a critically important question about 
accountability of these programs. Americans are expecting them 
to be there when they need them. When they're not, it creates 
yet another layer of uncertainty at a time of devastation, or 
at least uncertainty if you're forming a small business.
    So, certainly, what we need to do is have a review of these 
programs, what's working, what's not working, and make sure 
that it's data-driven. That we look holistically across the 
7(a) program, the Disaster Relief Program, and understanding 
what went wrong. What are the parameters of the program? Where 
have we gone outside the parameters and why, and what work we 
might do with Congress to strengthen these programs so that 
they're accessible.
    Obviously, Chair Ernst has pointed out rising delinquencies 
in the 7(a) loan program, rising delayed payments or early 
defaults. And these are the types of things that red flags 
should be put up sooner. We need greater accountability in this 
agency, and certainly we can't find out two days later when we 
had assurances that there was a disaster fund ready for 
hurricane victims, that it's actually dry. That's an abuse of 
taxpayer dollars and of the program, and we need to get to the 
bottom of it.
    So, you have my assurance that if confirmed, we will work 
closely to be a steward of taxpayer dollars be accountable to 
this committee. And I know President Trump strongly supports 
the small business community having the resources they need in 
an efficient manner that respects taxpayer dollars.
    Because, let's face it, the 7(a) loan program, the bread-
and-butter loans that small businesses use to start, is meant 
to operate at a zero subsidy. Meaning, taxpayers do not fund 
these programs. They should pay for themselves when they 
operate appropriately, and they generally do that. But we're in 
a position right now as this year starts that that may not 
happen. So, we need to investigate that.
    Senator Husted. Great. One more thought. One of the things 
that I always talk to my team about is customer service. How do 
we serve people well? Are we listening to our customer? And 
then, what are they telling us, and how are we turning that 
information back to into change enhancements? Things like that, 
that we can do.
    So, I'm interested in your thoughts on how you intend to do 
that, and then encourage you to let us know what you learn so 
that we can be better in what we do and how we serve those same 
customers.
    Senator Loeffler. This is an area that I really look 
forward to getting into. The field program, the field operation 
that SBA has could be incredibly powerful to increasing 
responsiveness, to tailoring programs that are more efficient, 
to deliver resources to small businesses in a way that the 
original formation of the agency's attempt was meant to do.
    So, I think, first of all, getting people back to work, 
getting people out in the field, tracking the data, and using 
that feedback loop. Looking at how long our case times are 
open, how long is a case open when someone comes to us with a 
question? How long do they have to wait on the phone for 
someone to answer it? When you're a small business person, you 
don't have any extra time. And I think what small businesses 
want to know is that there are people at this agency that 
understand the challenges and the complexities that they 
already deal with. And this agency doesn't need to be one of 
them. So, we want to be part of the solution, not the problem.
    Senator Husted. Great. Thank you.
    The Chair. Wonderful. Thank you, and welcome to the 
committee. Senator Rosen, five minutes, please. Thank you.
    Senator Rosen. Thank you, Chair Ernst, Ranking Member 
Markey, for holding this hearing. And Senator Loeffler, when 
you came to the Senate, your office was a cross of mine from 
Russell. And I appreciate your service to the nation. You know 
how this place works and your willingness to serve again. And 
I, too, have had a great relationship with all the past 
administrators under both administrations because small 
business matters, and I look forward to having the same ones 
with you.
    In our discussions, we talked about the challenges and the 
resources and just being able to get to the people who need it 
and help them do what is their dream or their idea, really 
important. So, Chair Ernst and I, we've had a bill out there 
for a while we talked about a little bit, too. It's on 
childcare, because childcare is so important and the rising 
cost of childcare, severe shortage of affordable options, 
they're really financially squeezing. Not just Nevada families, 
I would say families all over this country, urban and rural.
    And lack of access to childcare. It's really a problem for 
small business and parents alike. And it creates barriers for 
people who want to start or even grow their business, right? 
And it makes it difficult for small businesses sometimes to 
retain employees because they struggle to find affordable 
childcare. So, this is why we know this crisis demands action.
    And, yesterday, we reintroduced our bill, again, Chair 
Ernst and I, the Small Business Childcare Investment Act. Our 
bipartisan bill will increase the availability of affordable, 
high-quality childcare for working families by allowing 
nonprofits, your boys and girls clubs, your YMCA, your church, 
your mosque, your synagogue, whatever that is. I've even talked 
to senior centers in rural areas. They have a big footprint 
commercial kitchen. They said we're a place where the 
community, we could put up childcare, right?
    And so, this program doesn't cost anything. It just lets 
down the guardrail so that nonprofits have the opportunity to 
apply for the same resources. And now they can put this 
affordable childcare. They're nonprofit, they don't need to 
make a profit. And we look forward to getting it over the 
finish line as quickly as possible.
    And so, can you discuss a little bit how you feel about the 
childcare crisis, how it impacts small business, and are you 
open to SBA expanding access to resources and loans to 
nonprofits?
    Senator Loeffler. Senator, thank you for the question, and 
appreciated our time together in your office to hear more about 
Nevadans' needs and how the SBA can be part of it. And I think 
childcare is a relevant issue in every single state across this 
country. Small businesses, particularly given the need to 
provide for childcare for the owner--like, if you're a small 
business owner or an employee, it cuts across every single 
person that touches a small business.
    And I think small businesses can be part of the solution. 
And I'd love to work with you and Chair Ernst to review this 
potential solution and to look at other ways that the SBA might 
support parents and children as they work in small businesses. 
So, I look forward to those conversations and the input of the 
rest of the committee as well.
    Senator Rosen. Thank you. And something we had a great talk 
about was our veterans and how entrepreneurial they are, and 
how much they take the things that they've learned at the 
military, and they can translate those to things when they come 
home.
    And so, Nevada, we are home to over 200,000 veterans and 
over 23,000 veteran-owned small businesses. And despite this, 
Nevada was without, for the longest time, a dedicated in-state 
Veterans Business Outreach Center, easier to say VBOC, until 
2023, when at my urging, we pushed the administration to have 
Nevada have its first SBA VBOC. And our veterans, our 
transitioning service members, they receive that tailored 
support they need. And like I said, we talked about it with 
your own dad and how he started his business. It was such a 
great story. So, I appreciate you shared that with me.
    So, in the Fiscal Year 2025 budget, SBA requested an 
increase for veterans' outreach underscoring the importance of 
VBOCs and helping ease the transition from active duty to 
civilian life. So, under your leadership what do you see as the 
future for the Veterans Business Outreach Center and how it 
helps?
    Senator Loeffler. Senator, I couldn't agree more. Our 
veterans need the support of the SBA. And if confirmed, I would 
love to work with all of you on how do we better support our 
veterans. As I mentioned, my father learned truck driving 
skills in the Air National Guard that resulted in our small 
trucking business. We know that veterans have untapped 
potential that we can help unleash. I will commit to working 
with this committee and even across this administration with 
Secretary Collins to ensure that our veterans have the 
resources that they so deserve.
    Senator Rosen. Thank you. And I'll submit the rest of my 
questions for the record, but they're mostly on workforce 
development. We had a good chance to talk about how we train 
people right where they are, to give them the skills they need 
to stay in their communities and build back those 
neighborhoods, and diners, and all of that, wherever they are, 
and how important it is. So, I look forward to hearing back 
from you and working with you.
    Senator Loeffler. Thank you, Senator Rosen.
    Senator Rosen. Thank you, Madam Chair.
    The Chair. Thank you, Senator Rosen. And we will start a 
second round of questions. I believe Senator Markey, our 
ranking member, has another question. Thank you.
    Senator Markey. Thank you. And one of the benefits of being 
Chair or Ranking Member is all the other members leave, and 
they don't even know that there's a hearing that continues, and 
we get to ask more questions.
    So, earlier, one of the Republican Senators asked you, 
Senator, about the DEI executive orders and mentioned the 8(a) 
business development program for socially and economically 
disadvantaged small businesses, that it was deemed 
unconstitutional. It was not deemed unconstitutional. The 
application process had to change and the program continues.
    So, with that clarification, earlier, you said, Senator, 
that President Trump's executive order overturned DEI SBA 
programs. And, again, 8(a) for socially and economically 
disadvantaged small businesses, it's codified. So, in your 
opinion, does an executive order overturn a law that was put on 
the books by this committee on a bipartisan basis?
    Senator Loeffler. Ranking Member Markey, thank you for the 
question. I think the important thing to note here is I support 
President Trump's executive order overturning DEI programs, but 
I've also committed----
    Senator Markey. But can an executive order overturn----
    Senator Loeffler [continuing]. To following the law----
    Senator Markey. I'm sorry. Please, go on.
    Senator Loeffler. Yes. I've committed to following the law. 
We will work with the administration to ensure that all 
Americans have access to the programs that exist in the Small 
Business Administration under the law, and we'll continue to 
keep this committee updated as to any modifications as we go.
    Senator Markey. So, do you believe the law does, in fact--
an executive order does, in fact, overturn a law passed by the 
House and Senate, and signed by a President? Is that your 
conclusion that President Trump is right and that all DEI 
programs are now removed?
    Senator Loeffler. Ranking Member Markey, I've committed to 
you that I will uphold the law in all the programs, and we will 
communicate any changes to the programs to this committee.
    Senator Markey. You believe that, therefore, that you're 
authorized to change DEI programs because of an executive 
order, even though it's statutorily mandated that those 
programs are on the books?
    Senator Loeffler. I support President Trump's executive 
orders, and we will ensure that we follow the law in the 
administration of this SBA.
    Senator Markey. Okay. Well, the Small Business 
Administration administers a number of programs that aim to 
level the playing field for entrepreneurs from underserved 
communities that have faced historical barriers to small 
business ownership due to discrimination and prejudice.
    The programs that this committee has put on the books 
include the service-disabled, veterans-owned small businesses, 
women's business centers, and 8(a) business development 
programs for the disadvantaged. And these programs, and many 
others like them, are codified into statute, and recent actions 
by President Trump seek to rescind these so-called DEI 
initiatives.
    But as Administrator, President Trump's executive order 
would also direct you to terminate diversity, equity, 
inclusion, and accessibility positions at SBA. And in light of 
that, we just have to remember that executive orders cannot 
change or rescind Congressional mandates. We are the Article 1 
branch of government.
    When those red coats were going down Massachusetts Avenue 
in Massachusetts, and the Minutemen and women came out in 
Lexington and Concord, they were saying no taxation without 
representation. They already had a King. They could pick a 
Prime Minister or a President, but they were going to have a 
House and Senate, which is why we're Article 1 in the 
Constitution. That's what the Minutemen and women all across 
our country were fighting for.
    And so, Trump might think he can overturn what we do here, 
but that's what the revolution was all about. It was about 
having representation on this committee. And you may say that 
you're going to support him and that he's the law, but he's not 
the law. And I just want to continue this conversation with you 
because I just think that there has to be an understanding that 
supporting women-owned businesses----
    Senator Loeffler. Senator, I can assure you I will 
support----
    Senator Markey. Do you believe supporting women-owned 
businesses is DEI?
    Senator Loeffler. Senator, I've never said that. Senator, I 
can assure you that I will uphold the law. I was a women-owned 
business. I had a majority, minority women-owned business for a 
decade. I understand the importance of it. By having a well-
functioning agency is the best way that we can assure that 
there is more access to these programs by a diverse range of 
communities without picking winners and losers. That's what the 
American people want. That's why President Trump won in a 
landslide, because the American people want fairness and merit 
brought back. And you and I have discussed that in your office. 
That's what this country's about.
    Senator Markey. But you do understand that it has to be the 
Congress that changes the laws, it can't be done by executive 
order?
    Senator Loeffler. Yes, Senator, I will uphold the law.
    Senator Markey. Okay. Thank you.
    The Chair. Thank you, Ranking Member Markey. And I'll make 
some comments to this discussion as well. And we know that 
there are many programs that are codified. They are in law. And 
you will uphold the law, and I appreciate that answer.
    Unfortunately, what we did see during the Biden 
Administration was through a lot of supplemental movement from 
the administration, they did put into place different DEI 
programs within the SBA. So, the executive order is likely to 
immediately roll back the Biden era DEI mandates that were 
supplemental, but those that are not legally binding.
    So, yes, I anticipate that you will follow the law, Senator 
Loeffler, should you be confirmed, and you're well on your way. 
I will assume your confirmation, not you. But again, there are 
many things that President Biden took within his own action, 
his own prerogative, within the SBA, that was not codified nor 
approved by this committee.
    So, we will ensure that you follow the law, Senator 
Loeffler. But certainly, we can roll back the things that were 
unilaterally done by President Biden in the SBA. Thank you. And 
I will recognize Senator Cantwell for five minutes.
    Senator Cantwell. Thank you, Chair Ernst, and 
congratulations on taking over the chairmanship. Great to see 
you there, and look forward really. Such a big integration 
between small businesses in the State of Washington, and our 
military and Hanford cleanup. And so, really great lessons that 
I think could be applied broader to other areas of the 
government.
    And great to see our new Ranking Member, Senator Markey. I 
know I probably feeling ancient at the moment, but it's not 
that long ago when Senator Kerry was the chair of this 
committee, and he brought a lot of energy to the SBIR and other 
important technology startup issues that were a big part of the 
discussion at that time. So, look forward to working with both 
of you on the committee.
    And it's good to see my former colleague again, 
congratulations on your nomination. You and I had a chance to 
talk briefly in the office. I wanted to bring up a couple of 
things. One, we had this question to Mr. Lutnick today at our 
Commerce hearing, but do you support the Minority Business 
Development Authority?
    Senator Loeffler. Senator, thank you for your time in your 
office. I enjoyed our conversation. Certainly, I appreciate 
that program that the Commerce Department runs and see that 
there's potential for collaboration between SBA. I really do 
support working across the administration to ensure our 
resources are utilized and we don't have overlap in our 
programs, and that they're serving Americans who need those 
services the most.
    Senator Cantwell. Thank you. And will you work with me to 
make sure that the Department of Agriculture meets this same 
small business, set aside challenge that DOD has so 
successfully done, but in this case, the Department of 
Agriculture really isn't giving our small mills the access that 
they need. And so, will you work with me to make sure that 
those important SBA issues are addressed at the Department of 
Ag?
    Senator Loeffler. Senator, I appreciate our conversation 
about your timber business. I think, if confirmed, I would look 
forward to working with Secretary Rollins to ensure that we 
have a collaborative relationship. I understand there was 
previously an MOU with the Department of Agriculture and hope 
that we can collaborate to support small businesses in that 
regard as well.
    Senator Cantwell. Thank you so much. I appreciate that. And 
when it comes to--let's just carry that on. One of the reasons 
why we want this infrastructure is because if you think about 
reducing the fuel that we need, and some of the ideas like 
cross-laminated timber, you need to have the mills in those 
regions. And so, to get the mills, you have to have the 
agreement that you're going to give them some supply.
    But now, look at the disaster we just saw in, you know, 
California. And we realized the situation is--we already knew 
this in the Northwest, we've had our share of pretty big 
dramatic fires. But there was a border crossing issue in Sumas 
where a town was flooded, and then a town of Malden where a 
fire wiped through the town. You know, over 300,000 acres 
burned in wildfires in my state, just in 2024.
    So, how do we make sure that we keep politics--I feel like 
so much politics happened on federal funding in the last few 
years. How do we keep the politics out of it and disagreements, 
and make sure--there was a case on the Malden Fire where it was 
delayed for months about a disagreement between the President 
then and our governor. And it took a new administration. And 
this was even though Cathy McMorris Rodgers and I were working 
together to say, let's do these funds. And how will you help us 
make delivering disaster assistance urgently without all this 
noise that we're hearing?
    Senator Loeffler. Senator, I appreciate the question. And I 
think, certainly, your state has had its share of disaster. You 
had the bomb cyclone in November and ongoing recovery from 
that. I think Americans were stunned by the politization of the 
hurricane response under FEMA where they refused to go to homes 
with Trump support, Trump signs in the front yards.
    Americans want to see the end to that. We should not be 
politicizing our disaster response. I think that that's 
something that we have to restore confidence in. And certainly, 
the SBA will be working with the Trump Administration to 
restore integrity to the relief efforts.
    Senator Cantwell. I don't know whether the chair has had 
this issue, but probably because there's disasters everywhere. 
And that is this whole debate about the way the funding model 
works currently in taking care of communities who've 
experienced disasters.
    The urban communities, because they have density, are taken 
better care of. And the rural areas--although a rural community 
is a rural community, Sumas is an example. It's right by the 
border. It hangs together. If Sumas isn't there, I'm not sure 
we can sustain that border. What'll happen is it'll get closed 
down. And then what? All the traffic will then have to go down 
I-5. So, it's a bad idea. Or in the Mukilteo, we had an economy 
that was devastated and people were like, ``No, we're not going 
to help you because you don't really have the same ratio.'' I'm 
like, it's a juggernaut of an economy. Just because it doesn't 
have density doesn't mean that it isn't a big problem.
    So, the GAO concluded that the SBA needs to recognize that 
rural communities experience disasters differently--not really 
differently. They're devastated, just they're not in the same 
density. So, as we consider how to make SBA loans for small, 
vulnerable, rural communities more viable, do you think 
businesses and homeowners--we want them to return to these 
areas. We don't want to see a community--in our case, these are 
communities that sit on close proximity to the Cascades, but 
they're a huge tourism economy for the whole state. So, they 
have a big footprint.
    So, what are your thoughts on how we implement this SBA 
change, working with our colleagues to get a better recognition 
of the economic impact that disadvantages rural communities?
    Senator Loeffler. Well, Senator, I would love to work with 
you on that, to visit your state, to understand the dynamics 
there. I grew up in a rural community. I understand the unique 
characteristics of delivering relief. I mean, we lived in the 
heartland, lived through tornadoes, hailstorms, and other 
devastating efforts that of recovery together as a community. 
And often, the TV cameras weren't there. You're recovering on 
your own.
    So, how can we better ensure that disaster relief isn't 
based on, as you mentioned, any politics or media profile, but 
where the relief is sorely needed to prop up and strengthen the 
economic stability of that tax base of the community, the 
culture, the people, the generations that live there, and the 
industry that it supports. So, I'd love to work with you on 
that, if confirmed,
    Senator Cantwell. Thank you. Is my time expired, Madam 
Chair?
    The Chair. Yes.
    Senator Cantwell. Thank you so much. Sorry to go on. But 
those are very important issues, and I so appreciate the 
opportunity to ask them and look forward to working on these 
with you.
    The Chair. No, thank you, Senator Cantwell, and I would 
enjoy working with you on that as well. Because, yes, in the 
State of Iowa, we have had challenges with disaster recovery 
and the cost to benefit ratio. We have struggled this with this 
for a very long time because of our rural areas.
    And just for the audience, if I can take the chair's 
prerogative here and share with you. We have many disasters, 
flooding, in particular in Iowa, where many restaurants and 
downtown rural communities are destroyed. But the cost to 
benefit ratio is never high enough for the federal government 
to come in and provide that level of assistance.
    However, if a restaurant on an Eastern or Western Coast, 
you know, along the ocean is destroyed, well, of course the 
cost to benefit ratio is going to be higher. The cost of that 
restaurant is much higher. So, they are the ones that are 
likely to receive the disaster assistance, but not those of us 
that are in the Midwest.
    A home of one size in Iowa is much cheaper than a home on 
the coast, but it's still someone's home. It's still someone's 
business. So, I think that we have a lot of work to do in this 
area, and I'd be happy to partner with you on that, Maria.
    Senator Cantwell. Well, thank you, Madam Chair. And I think 
the added thing that people don't realize is that it also is a 
economy that generates a lot of revenue for absolutely your 
state. It could be an Ag economy, it could be a tourism 
economy, it could be a community that offers something 
different.
    But if you take that out of the middle of your state or 
wherever it is because the ratio just hasn't been addressed 
correctly, then we're losing out on that big economic picture. 
So, we have to get people to realize that that relationship to 
the state overall should somehow be considered in the ratio.
    The Chair. Yeah, absolutely. Thank you for that input, 
Senator Cantwell. And a number of issues were addressed today 
during this really productive hearing. And thank you for being 
here, and I want to thank President Trump for your nomination 
to the Small Business Administration. I look forward to working 
with you upon your confirmation into this position. And because 
there are no other questions, I again want to thank you very 
much for your willingness to serve, and to be here today, and 
for your family's support of you in this position.
    We are going to leave the record open until close of 
business tomorrow at 5:00 p.m. Thursday, January 30th, for 
members to submit questions for the record. And we will keep 
the record open for two weeks to edit statements, and submit 
letters, and any other relevant materials. Without objection, 
so ordered. Senator Loeffler, we would appreciate your prompt 
response to any additional questions that are submitted. With 
that, the Committee on Small Business and Entrepreneurship 
stands adjourned.
    [Whereupon, at 5:29 p.m., the hearing was adjourned.]
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