Jack Stevens: Users Disprove Justification for Eliminating Indian Loan Guarantee Program (ILGP)

We’ve posted a lot in this space about the need to preserve the ILGP, now targeted for extinction by budgeteers who have been told that it is redundant of other federal loan programs.

Now it’s time to hear from two of the most frequent users of the ILGP as to why the charge of duplication is spurious.

In a letter dated June 8, 2025, David Burrell, Chairman of Pinnacle Bank – which has relied on the ILGP to loan $204 million over the past 11 years with zero losses – points out that, the ILGP stands apart from every other federal loan guarantee program: "SBA guarantees require foreclosure and collateral liquidation—unworkable on trust land. They have a loan limit of $10,000,000 which doesn’t cover the increased costs since COVID for projects in Indian Country.  SBA coverage also shrinks on larger loans, whereas ILGP provides a 90% guarantee regardless of size. The USDA Business & Industry loan process is overly bureaucratic and has consistently failed to support tribal projects. Also their fees are excessive compared to ILGP, charging 3% up front and .55% annually where ILGP is 2% only."

Likewise, Payton Batliner, Senior Vice President and Chief Lending Officer of Native American Bank, adds that, “Most federal loan guarantee programs—like the SBA 7(a), USDA Business & Industry (B&I), or Community Facilities (CF) programs—are excellent tools for rural America. But they weren’t designed with Indian County in mind.”

Indeed, of all the federal loan guarantee programs, only the ILGP recognizes that Indian Country is like no other place in America – 56 million acres of trust land in which the beneficial users have no ownership and thus no way to offer the land as collateral.

We hope that budget decision-makers will realize this as well and will keep alive this vital, one-of-a-kind, 51-year-old program.