In a surprise move, ASTA has called for a new federal government program to provide direct loans to cash-strapped small business owners. In a statement, Chris Russo, president and CEO of ASTA, urged action by the Small Business Administration (SBA) and cited the success of a similar program after 9/11.
"The flow of credit from lending institutions to small businesses seeking additional capital to make payroll, to fund planned expansions, or to pay for unexpected expenses is a necessary part of any healthy economy," Russo said. "During this time of unprecedented economic distress, many travel agents and other small businesses are facing serious obstacles in obtaining credit."
On Monday, November 17, Russo wrote to Sandy K. Baruah, the administrator of the SBA, asking his agency to use its existing authority to provide direct low-interest rate loans to small businesses. In the letter, Russo notes there is precedent for such a decision. In the wake of the events of 9/11, the SBA created a program to provide emergency loans to small businesses who had suffered economic hardship as a result of the attacks. Hundreds of travel agencies were saved by that program, ASTA said.
"Immediate expansion of direct SBA lending would be an efficient, effective response to the problems facing travel agents and small businesses in a troubled economy," said Russo. "As federal officials look for ways to help stimulate the economy, I urge them to consider expanding the lending options available to small businesses as one of their next steps."