Lenders who were concerned about the changes in the document had requested that the effective date be pushed back twice. They originally had 15 days to adjust to the user-friendly SOP 50-10 before it went into effect, but their requests delayed the effective date from May 1 to June 15, and finally to Aug. 1. Eric Zarnikow, the SBA’s associate administrator for capital access, was asked to provide lenders at least 60 days before implementing the new rules in order to “allow sufficient time to identify the program changes, make necessary adjustments, and appropriately train staff members.” The SBA agreed to the delays in order to become “good partners” with its lenders.

“We really had an agenda at the SBA of being easier to work with our lending partners,” Zarnikow says. The SOP document was updated because the previous one was “awkward to deal with.” Zarnikow says that the revised SOP is not a “big policy change document.” To make the document more accessible for lenders, it was published online and streamlined from 1,000 pages to 400 pages. Once the revised SOP 50-10 takes effect, it will be updated every six months.

Marilyn Landis, a former SBA lender and now small business owner, says the revised document isn’t easier to use and says it does, in fact, have any policy changes.
“I think many lenders are saying, ‘We’re all in favor of improving the SOP because it was tough to maneuver,’” she says. “But when they finally published it, lenders really had a chance to look at what some of this meant and said ‘Wait a minute. There’s some major changes in here, and we’ve got some problems with those changes.’”

One noted change requires small business owners to complete more environmental due diligence to their property, while another will no longer allow owners to use home equity toward their businesses. “You see someone who’s worked hard, they’ve built some equity in their home, and they want to tap into that resource because they have an opportunity to grow their business,” Landis says. “[But] they’re not going to be able to.”
For more information about the SOP 50-10 revisions, visit www.sba.gov.

Although minorities and women represent the fastest growing groups in the small- business community, they were more pessimistic than the majority, believing the economy is worse (48% and 53%, respectively, compared with 43% of all business owners).

“The problem right now in this country is we have an economy that is struggling,” says Sharon Joseph, co-founder and co-owner of Harlem Lanes, a bowling alley and sports bar located in New York.

“The general unease of the economy has left small-business owners feeling like things aren’t going in the right direction,” says Todd McCracken, president of NSBA. “[But] as things solidify nationally, I think those numbers will turn around a bit.”

The Washington, D.C.-based small-business advocacy group surveyed 500 small- to mid-sized companies in an effort to gauge their challenges, perceptions, and outlook as fledgling businesses across the country.

For the purpose of the survey, “economic uncertainty” was not defined for the businesses. “In terms of what that meant, [we left that] in the eyes of the respondents,” says Glen Bolger, partner and co-founder of Public Opinion Strategies, the research firm that conducted the survey. Although a myriad of things contribute to their discontent, the findings reveal that the biggest concerns facing these businesses include economic uncertainty, the cost of healthcare benefits, and a lack of available capital.

In addition, while businesses with 100 to 499 employees are able to rely on bank loans and earnings from their business, companies with less than five employees depend more on credit cards and private loans to meet their capital needs–71% revealed that they use credit cards to carry over substantial balances month to month.

McCracken says organizations like NSBA are working to help alleviate some of these issues. For example, he says they have been in talks with individuals on Capitol Hill about limiting how often credit card companies can change terms and conditions as well as how much they charge.

Despite such dismal news, small-business owners remain optimistic. Eighty-one percent of respondents expressed “considerable confidence in a bright future for their own business.” “We are optimistic and we [will] succeed on the support of the community,” says Joseph, who emphasized the importance of investing in black-owned businesses adding that it is up to us to “sustain our own companies.”