Free Beacon: Billions in Taxpayer Funded Loans Going to Companies that Serve the Rich Money35

December 18, 2014 04:40 AM
By: Brent Scher  
December 18, 2014 12:50 pm
The Washington Free Beacon
The Small Business Administration exists to help Americans "start, build, and grow" businesses, but an analysis of more than $67 billion worth of SBA loans finds that much of the taxpayer funds went to "wealthy lifestyle" businesses such as members-only country clubs and luxury auto dealers.
Open the Books, a project of non-profit group American Transparency, found that more than 35,000 loans and loan guarantees ranging from $1 to $5 million have been granted by the SBA since 2007, and that the recipients are not your average "small businesses."
One major beneficiary of the SBA has been exclusive clubs across the country, ranging from private golf clubs to yacht clubs. $160.867 million in loans have been granted to private clubs since 2007, including $2 million to the Pequonnock Yacht Club in Connecticut, $5 million to the Horseshoe Bend Country Club in Georgia, and $3.282 million on the Frisco Gun Club in Texas.
Open the Books writes that "these country clubs built new golf courses, pools, clubhouses, banquet facilities, outdoor waterfalls, and bridges" with the loans, and that the taxpayers were the "backstop" for the risk.
The SBA also supplied $760 million in loans to companies that provide "luxury indulgences," such as $3.497 million to Lamborghini dealerships and $3.296 million to BMW Motorcycle dealerships.
$18.890 million was also granted to helicopter tour companies, such as Maverick Helicopters in Nevada, which offers VIP trips straight to the Las Vegas strip on the "newest and most advanced fleet in the world."
Amongst the most "posh" recipients identified by the study were "extreme luxury resorts for pets."
"$75.946 million of SBA loans flowed into 49 high-end, luxury pet resorts across America," writes the report. One $2.14 million loan went to the Forest Shadows Pet Resort, which notes on its website that it offers "extras such as anal gland expression."
The Open the Books report was made possible by the Federal Funding Accountability and Transparency Act of 2006, a bill cosponsored by Sen. Tom Coburn (R., Okla.) and then-Sen. Barack Obama (D., Ill.).
"I know that restoring transparency is not only the surest way to achieve results,
but also to earn back the trust in government," said Obama at the time.
Under his presidency, however, the SBA has been an agency on the rise. Obama made SBA administrator a cabinet-level position in 2012. During the past three years of his administration, the number of SBA loans awarded with value of more than $1 million have increased by more than 100 percent.
The report categorizes these million dollar loans from the taxpayers to companies that serve the "wealthy lifestyle" as a case of "Robin Hood in reverse."
They add that large loans from the SBA ruins the competitive balance between companies.
"When the SBA approves a loan, by definition, taxpayer money is used to compete against another taxpaying business," says the report. "Government loans of $1 million plus create a potentially pernicious unleveled playing."
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