Hatch warns against rushed SBLF applications

9/26/2011

In a letter sent to U.S. Treasury Secretary Timothy Geithner, Utah Senator Orrin Hatch expressed his concern over the Treasury's ability to scrutinize applications as the Small Business Lending Fund deadline grows near, The Wall Street Journal reports.

According to Bloomberg, President Barack Obama's SBLF program has distributed a mere $2.4 billion out of the $30 billion the President allocated to banks to lend to qualified small businesses.

Now, with the program's September 27 deadline looming, Hatch worries that Treasury members may allow applications without proper inspection in order to inch closer to the $11.8 billion in funding applied for by 926 institutions.

"As I have previously conveyed to you, I remain concerned that the prudent allocation of taxpayer dollars may lose out to the pressure for rushed allocation of funds prior to the program’s expiration," Hatch said in the letter on September 23, as quoted by WSJ. "It seems difficult to comprehend how the remaining $9.4 billion that has been applied for could be approved and disbursed in just six days."

Hatch's concerns are justified. The Department of Energy previously provided failed solar-panel maker Solyndra with a $535 million loan guarantee, possibly due to a less-than-thorough application review.